Silicon Graphics International Corp (SGI, Financial) filed Quarterly Report for the period ended 2010-12-24.
Silicon Graphic has a market cap of $310.2 million; its shares were traded at around $10.15 with and P/S ratio of 0.8. Hedge Fund Gurus that owns SGI: Jim Simons of Renaissance Technologies LLC, Bruce Kovner of Caxton Associates, Steven Cohen of SAC Capital Advisors.
Sales and marketing expense increased $1.2 million or 7% to $18.0 million in the three months ended December 24, 2010 from $16.9 million in the three months ended December 25, 2009. The increase in sales and marketing expense was primarily due to increases in compensation and related expense of $0.7 million and third party sales and marketing services of $0.4 million. In addition, intangible amortization expense increased by $0.2 million, equipment and supplies expense is higher by $0.1 million, recruiting expense increased by $0.1 million, and travel expenses increased by $0.1 million. Headcount decreased by seven employees from 254 employees as of December 25, 2009 to 247 employees as of December 24, 2010. Despite the decrease in headcount, compensation and related expense increased due to an increase of $0.8 million in commissions and bonuses paid to employees for the three months ended December 24, 2010 compared to December 25, 2009. The overall increase in sales and marketing expense was partially offset by a decrease in facilities related expense of $0.5 million.
Sales and marketing expense increased $1.3 million or 4% to $33.0 million in the six months ended December 24, 2010 from $31.6 million in the six months ended December 25, 2009. The increase in sales and marketing expense was primarily due to increases in compensation and related expenses of $0.6 million, third party sales and marketing services of $0.5 million, recruiting related expenses of $0.3 million, travel expenses of $0.6 million, share-based compensation expenses of $0.3 million and equipment and supplies of $0.1 million. The increase in sales and marketing expense was partially offset by a decrease in facilities related expense of $0.8 million and a decrease in intangible amortization of $0.4 million.
General and administrative expense decreased $1.2 million or 9% to $11.8 million in the three months ended December 24, 2010 from $13.0 million in the three months ended December 25, 2009. The decrease in general and administrative expense was primarily due to decreases in audit and tax related services of $0.9 million, legal related expenses of $0.6 million, facilities related expense of $0.4 million, insurance of $0.3 million and property and other taxes of $0.1 million. The decrease in general and administrative expense was partially offset by increases in compensation and related expense of $0.9 million and bad debt expense of $0.3 million. Headcount increased by 15 employee from 178 employees to 193 employees as of December 24, 2010 compared to December 25, 2009.
General and administrative expense decreased $2.3 million or 8% to $24.5 million in the six months ended December 24, 2010 from $26.8 million in the six months ended December 25, 2009. The decrease in general and administrative expense was primarily due to decreases in third party consulting services of $1.2 million, legal related services of $0.7 million, audit and tax related services of $0.3 million, share-based compensation expenses of $0.2 million, insurance of $0.6 million and property and other taxes of $0.1 million. The decrease in general and administrative expense was partially offset by increase in compensation and related expenses of $0.7 million and increase in recruiting related expenses of $0.1 million.
Cash used in operating activities was $23.4 million for the six months ended December 24, 2010. Our net loss was $7.5 million for the six months ended December 24, 2010. Non-cash items included in net loss consisted primarily of depreciation and amortization expense of $8.6 million, share-based compensation expense of $2.5 million, impairment of equity investment of $2.9 million, realized loss on investments of $1.2 million, and provisions for doubtful accounts receivable of $0.4 million. Net change in operating assets and liabilities was $31.4 million. The primary operating activity source of cash was a decrease in inventory, increase in other liabilities and deferred revenue. The primary operating activities uses of cash were increases in accounts receivable, deferred cost of revenue, prepaid expenses and other current assets and decreases in accounts payable and accrued compensation.
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Silicon Graphic has a market cap of $310.2 million; its shares were traded at around $10.15 with and P/S ratio of 0.8. Hedge Fund Gurus that owns SGI: Jim Simons of Renaissance Technologies LLC, Bruce Kovner of Caxton Associates, Steven Cohen of SAC Capital Advisors.
Highlight of Business Operations:
Research and development expense decreased $1.0 million or 7% to $13.4 million in the three months ended December 24, 2010 from $14.4 million in the three months ended December 25, 2009. The decrease in research and development expense is primarily due to a $0.4 million increase in research and development reimbursements from our business partners. During the three months ended December 24, 2010, we received $0.5 million of research and development reimbursements compared to $0.1 million of research and development reimbursements during the three months ended December 25, 2009. In addition, during the three months ended December 24, 2010, facilities related expense decreased by $0.4 million, third-party research and development services decreased by $0.3 million and share-based compensation expense decreased by $0.1 million. The decrease in research and development expense is partially offset by increase in compensation and related expenses of $0.3 million in the three months ended December 24, 2010 compared to the three months ended December 25, 2009. This increase in compensation is primarily due to increase in headcount by five employees from 273 employees as of December 25, 2009 to 278 employees as of December 24, 2010.Sales and marketing expense increased $1.2 million or 7% to $18.0 million in the three months ended December 24, 2010 from $16.9 million in the three months ended December 25, 2009. The increase in sales and marketing expense was primarily due to increases in compensation and related expense of $0.7 million and third party sales and marketing services of $0.4 million. In addition, intangible amortization expense increased by $0.2 million, equipment and supplies expense is higher by $0.1 million, recruiting expense increased by $0.1 million, and travel expenses increased by $0.1 million. Headcount decreased by seven employees from 254 employees as of December 25, 2009 to 247 employees as of December 24, 2010. Despite the decrease in headcount, compensation and related expense increased due to an increase of $0.8 million in commissions and bonuses paid to employees for the three months ended December 24, 2010 compared to December 25, 2009. The overall increase in sales and marketing expense was partially offset by a decrease in facilities related expense of $0.5 million.
Sales and marketing expense increased $1.3 million or 4% to $33.0 million in the six months ended December 24, 2010 from $31.6 million in the six months ended December 25, 2009. The increase in sales and marketing expense was primarily due to increases in compensation and related expenses of $0.6 million, third party sales and marketing services of $0.5 million, recruiting related expenses of $0.3 million, travel expenses of $0.6 million, share-based compensation expenses of $0.3 million and equipment and supplies of $0.1 million. The increase in sales and marketing expense was partially offset by a decrease in facilities related expense of $0.8 million and a decrease in intangible amortization of $0.4 million.
General and administrative expense decreased $1.2 million or 9% to $11.8 million in the three months ended December 24, 2010 from $13.0 million in the three months ended December 25, 2009. The decrease in general and administrative expense was primarily due to decreases in audit and tax related services of $0.9 million, legal related expenses of $0.6 million, facilities related expense of $0.4 million, insurance of $0.3 million and property and other taxes of $0.1 million. The decrease in general and administrative expense was partially offset by increases in compensation and related expense of $0.9 million and bad debt expense of $0.3 million. Headcount increased by 15 employee from 178 employees to 193 employees as of December 24, 2010 compared to December 25, 2009.
General and administrative expense decreased $2.3 million or 8% to $24.5 million in the six months ended December 24, 2010 from $26.8 million in the six months ended December 25, 2009. The decrease in general and administrative expense was primarily due to decreases in third party consulting services of $1.2 million, legal related services of $0.7 million, audit and tax related services of $0.3 million, share-based compensation expenses of $0.2 million, insurance of $0.6 million and property and other taxes of $0.1 million. The decrease in general and administrative expense was partially offset by increase in compensation and related expenses of $0.7 million and increase in recruiting related expenses of $0.1 million.
Cash used in operating activities was $23.4 million for the six months ended December 24, 2010. Our net loss was $7.5 million for the six months ended December 24, 2010. Non-cash items included in net loss consisted primarily of depreciation and amortization expense of $8.6 million, share-based compensation expense of $2.5 million, impairment of equity investment of $2.9 million, realized loss on investments of $1.2 million, and provisions for doubtful accounts receivable of $0.4 million. Net change in operating assets and liabilities was $31.4 million. The primary operating activity source of cash was a decrease in inventory, increase in other liabilities and deferred revenue. The primary operating activities uses of cash were increases in accounts receivable, deferred cost of revenue, prepaid expenses and other current assets and decreases in accounts payable and accrued compensation.
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