x
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
77-0353939
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(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
Large accelerated filer
x
|
|
Accelerated filer
¨
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Non-accelerated filer
¨
(Do not check if a smaller reporting company)
|
|
Smaller reporting company
¨
|
|
|
Page
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PART I
|
|
|
ITEM 1.
|
||
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||
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||
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||
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||
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ITEM 2.
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ITEM 3.
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ITEM 4.
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PART II
|
|
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ITEM 1.
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||
ITEM 1A.
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ITEM 2.
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ITEM 3.
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ITEM 4.
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ITEM 5.
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ITEM 6.
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||
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September 30,
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June 30,
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||||
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2015
|
|
2015
|
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
110,894
|
|
|
$
|
95,442
|
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Accounts receivable, net of allowances of $1,438 and $1,628 at September 30, 2015 and June 30, 2015, respectively (including amounts receivable from a related party of $11,974 and $13,186 at September 30, 2015 and June 30, 2015, respectively)
|
297,078
|
|
|
322,594
|
|
||
Inventory
|
461,371
|
|
|
463,493
|
|
||
Deferred income taxes-current
|
18,712
|
|
|
17,863
|
|
||
Prepaid income taxes
|
2,391
|
|
|
7,507
|
|
||
Prepaid expenses and other current assets
|
7,796
|
|
|
7,516
|
|
||
Total current assets
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898,242
|
|
|
914,415
|
|
||
Long-term investments
|
2,633
|
|
|
2,633
|
|
||
Property, plant and equipment, net
|
169,149
|
|
|
163,038
|
|
||
Deferred income taxes-noncurrent
|
5,816
|
|
|
4,497
|
|
||
Other assets
|
6,147
|
|
|
5,226
|
|
||
Total assets
|
$
|
1,081,987
|
|
|
$
|
1,089,809
|
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LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable (including amounts due to a related party of $55,886 and $59,015 at September 30, 2015 and June 30, 2015, respectively)
|
$
|
263,223
|
|
|
$
|
299,774
|
|
Accrued liabilities
|
50,169
|
|
|
46,743
|
|
||
Income taxes payable
|
11,045
|
|
|
14,111
|
|
||
Short-term debt and current portion of long-term debt
|
94,574
|
|
|
93,479
|
|
||
Total current liabilities
|
419,011
|
|
|
454,107
|
|
||
Long-term debt-net of current portion
|
233
|
|
|
933
|
|
||
Other long-term liabilities
|
24,629
|
|
|
15,684
|
|
||
Total liabilities
|
443,873
|
|
|
470,724
|
|
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Commitments and contingencies (Note 10)
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|
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Stockholders’ equity:
|
|
|
|
||||
Common stock and additional paid-in capital, $0.001 par value
|
|
|
|
||||
Authorized shares: 100,000,000
|
|
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||||
Issued shares: 48,022,874 and 47,873,744 at September 30, 2015 and June 30, 2015, respectively
|
252,426
|
|
|
247,081
|
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Treasury stock (at cost), 445,028 shares at September 30, 2015 and June 30, 2015
|
(2,030
|
)
|
|
(2,030
|
)
|
||
Accumulated other comprehensive loss
|
(98
|
)
|
|
(80
|
)
|
||
Retained earnings
|
387,649
|
|
|
373,950
|
|
||
Total Super Micro Computer, Inc. stockholders’ equity
|
637,947
|
|
|
618,921
|
|
||
Noncontrolling interest
|
167
|
|
|
164
|
|
||
Total stockholders’ equity
|
638,114
|
|
|
619,085
|
|
||
Total liabilities and stockholders’ equity
|
$
|
1,081,987
|
|
|
$
|
1,089,809
|
|
|
Three Months Ended
September 30,
|
||||||
|
2015
|
|
2014
|
||||
Net sales (including related party sales of $5,220 and $26,578 in the three months ended September 30, 2015 and 2014, respectively)
|
$
|
519,618
|
|
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$
|
443,322
|
|
Cost of sales (including related party purchases of $59,261 and $54,403 in the three months ended September 30, 2015 and 2014, respectively)
|
447,403
|
|
|
374,129
|
|
||
Gross profit
|
72,215
|
|
|
69,193
|
|
||
Operating expenses:
|
|
|
|
||||
Research and development
|
28,326
|
|
|
21,509
|
|
||
Sales and marketing
|
14,249
|
|
|
11,002
|
|
||
General and administrative
|
8,200
|
|
|
5,056
|
|
||
Total operating expenses
|
50,775
|
|
|
37,567
|
|
||
Income from operations
|
21,440
|
|
|
31,626
|
|
||
Interest and other income, net
|
87
|
|
|
35
|
|
||
Interest expense
|
(324
|
)
|
|
(196
|
)
|
||
Income before income tax provision
|
21,203
|
|
|
31,465
|
|
||
Income tax provision
|
7,504
|
|
|
10,602
|
|
||
Net income
|
$
|
13,699
|
|
|
$
|
20,863
|
|
Net income per common share:
|
|
|
|
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Basic
|
$
|
0.29
|
|
|
$
|
0.46
|
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Diluted
|
$
|
0.27
|
|
|
$
|
0.42
|
|
Weighted-average shares used in calculation of net income per common share:
|
|
|
|
||||
Basic
|
47,517
|
|
|
45,473
|
|
||
Diluted
|
51,352
|
|
|
49,687
|
|
|
Three Months Ended
September 30,
|
||||||
|
2015
|
|
2014
|
||||
Net income
|
$
|
13,699
|
|
|
$
|
20,863
|
|
Other comprehensive income, net of tax:
|
|
|
|
||||
Foreign currency translation loss
|
(18
|
)
|
|
(3
|
)
|
||
Unrealized gains (loss) on investments
|
—
|
|
|
—
|
|
||
Total other comprehensive loss
|
(18
|
)
|
|
(3
|
)
|
||
Comprehensive income
|
$
|
13,681
|
|
|
$
|
20,860
|
|
|
Three Months Ended
September 30,
|
||||||
|
2015
|
|
2014
|
||||
OPERATING ACTIVITIES:
|
|
|
|
||||
Net income
|
$
|
13,699
|
|
|
$
|
20,863
|
|
Reconciliation of net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
2,753
|
|
|
1,847
|
|
||
Stock-based compensation expense
|
3,876
|
|
|
2,980
|
|
||
Excess tax benefits from stock-based compensation
|
(134
|
)
|
|
(705
|
)
|
||
Allowance for doubtful accounts
|
98
|
|
|
(54
|
)
|
||
Provision for inventory
|
1,718
|
|
|
1,660
|
|
||
Exchange gain
|
(2,007
|
)
|
|
(235
|
)
|
||
Deferred income taxes
|
(2,221
|
)
|
|
973
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable, net (including changes in related party balances of $1,212 and $(1,795) during the three months ended September 30, 2015 and 2014, respectively)
|
25,418
|
|
|
18,422
|
|
||
Inventory
|
404
|
|
|
(27,364
|
)
|
||
Prepaid expenses and other assets
|
(1,247
|
)
|
|
1,547
|
|
||
Accounts payable (including changes in related party balances of $(3,129) and $(3,824) during the three months ended September 30, 2015 and 2014, respectively)
|
(37,652
|
)
|
|
2,131
|
|
||
Income taxes payable, net
|
2,966
|
|
|
6,726
|
|
||
Accrued liabilities
|
3,686
|
|
|
(1,903
|
)
|
||
Other long-term liabilities
|
8,949
|
|
|
158
|
|
||
Net cash provided by operating activities
|
20,306
|
|
|
27,046
|
|
||
INVESTING ACTIVITIES:
|
|
|
|
||||
Restricted cash
|
(3
|
)
|
|
10
|
|
||
Purchases of property, plant and equipment
|
(7,662
|
)
|
|
(2,766
|
)
|
||
Net cash used in investing activities
|
(7,665
|
)
|
|
(2,756
|
)
|
||
FINANCING ACTIVITIES:
|
|
|
|
||||
Proceeds from exercise of stock options
|
951
|
|
|
4,485
|
|
||
Minimum tax withholding paid on behalf of employees for restricted stock units
|
(196
|
)
|
|
—
|
|
||
Excess tax benefits from stock-based compensation
|
134
|
|
|
705
|
|
||
Proceeds from debt
|
4,700
|
|
|
—
|
|
||
Repayment of debt
|
(2,900
|
)
|
|
(8,500
|
)
|
||
Payment of obligations under capital leases
|
(39
|
)
|
|
(28
|
)
|
||
Payments under receivable financing arrangements
|
(37
|
)
|
|
(4
|
)
|
||
Net cash provided by (used in) financing activities
|
2,613
|
|
|
(3,342
|
)
|
||
Effect of exchange rate fluctuations on cash
|
198
|
|
|
(308
|
)
|
||
Net increase in cash and cash equivalents
|
15,452
|
|
|
20,640
|
|
||
Cash and cash equivalents at beginning of period
|
95,442
|
|
|
96,872
|
|
||
Cash and cash equivalents at end of period
|
$
|
110,894
|
|
|
$
|
117,512
|
|
Supplemental disclosure of cash flow information:
|
|
|
|
||||
Cash paid for interest
|
$
|
298
|
|
|
$
|
202
|
|
Cash paid for taxes, net of refunds
|
$
|
5,736
|
|
|
$
|
3,123
|
|
Non-cash investing and financing activities:
|
|
|
|
||||
Equipment purchased under capital leases
|
$
|
42
|
|
|
$
|
256
|
|
Accrued costs for property, plant and equipment purchases
|
$
|
5,735
|
|
|
$
|
2,976
|
|
•
|
Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;
|
•
|
Level 2 - Quoted prices in markets that are not active or financial instruments for which all significant inputs are observable, either directly or indirectly; and
|
•
|
Level 3 - Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable.
|
|
Three Months Ended
September 30,
|
||||||
|
2015
|
|
2014
|
||||
Risk-free interest rate
|
1.57
|
%
|
|
1.76
|
%
|
||
Expected life
|
5.33 years
|
|
|
5.44 years
|
|
||
Dividend yield
|
—
|
%
|
|
—
|
%
|
||
Volatility
|
47.06
|
%
|
|
46.93
|
%
|
||
Weighted-average fair value
|
$
|
11.64
|
|
|
$
|
11.75
|
|
|
Three Months Ended
September 30,
|
||||||
|
2015
|
|
2014
|
||||
Cost of sales
|
$
|
240
|
|
|
$
|
207
|
|
Research and development
|
2,402
|
|
|
1,896
|
|
||
Sales and marketing
|
404
|
|
|
365
|
|
||
General and administrative
|
830
|
|
|
512
|
|
||
Stock-based compensation expense before taxes
|
3,876
|
|
|
2,980
|
|
||
Income tax impact
|
(285
|
)
|
|
(607
|
)
|
||
Stock-based compensation expense, net
|
$
|
3,591
|
|
|
$
|
2,373
|
|
|
|
Options
Outstanding
|
|
Weighted
Average
Exercise
Price per
Share
|
|
Weighted
Average
Remaining
Contractual
Term
(in Years)
|
|
Aggregate
Intrinsic
Value
(in thousands)
|
|||||
Balance as of June 30, 2015 (7,208,475 shares exercisable at weighted average exercise price of $12.24 per share)
|
|
9,702,843
|
|
|
$
|
14.21
|
|
|
|
|
|
||
Granted (weighted average fair value of $11.64)
|
|
58,650
|
|
|
$
|
26.61
|
|
|
|
|
|
||
Exercised
|
|
(136,163
|
)
|
|
$
|
6.99
|
|
|
|
|
|
||
Forfeited
|
|
(10,240
|
)
|
|
$
|
20.28
|
|
|
|
|
|
||
Balance as of September 30, 2015
|
|
9,615,090
|
|
|
$
|
14.39
|
|
|
5.74
|
|
$
|
126,048
|
|
Options vested and expected to vest at September 30, 2015
|
|
9,487,502
|
|
|
$
|
14.25
|
|
|
5.70
|
|
$
|
125,461
|
|
Options vested and exercisable at September 30, 2015
|
|
7,462,651
|
|
|
$
|
12.61
|
|
|
4.99
|
|
$
|
109,294
|
|
|
|
Restricted Stock Units
Outstanding
|
|
Weighted
Average
Grant-Date Fair Value per Share
|
|
Aggregate
Intrinsic
Value
(in thousands)
|
|||||
Balance as of June 30, 2015
|
|
303,324
|
|
|
$
|
36.02
|
|
|
|
||
Granted
|
|
154,870
|
|
|
$
|
35.07
|
|
|
|
||
Vested
|
|
(20,199
|
)
|
|
$
|
35.75
|
|
|
|
||
Forfeited
|
|
(8,883
|
)
|
|
$
|
35.38
|
|
|
|
||
Balance as of September 30, 2015
|
|
429,112
|
|
|
$
|
35.70
|
|
|
$
|
11,698
|
|
|
Three Months Ended
September 30,
|
||||||
|
2015
|
|
2014
|
||||
Numerator:
|
|
|
|
||||
Net income
|
$
|
13,699
|
|
|
$
|
20,863
|
|
|
|
|
|
||||
Denominator:
|
|
|
|
||||
Weighted-average shares outstanding
|
47,517
|
|
|
45,473
|
|
||
Effect of dilutive securities
|
3,835
|
|
|
4,214
|
|
||
Weighted-average diluted shares
|
51,352
|
|
|
49,687
|
|
||
|
|
|
|
||||
Basic net income per share
|
$
|
0.29
|
|
|
$
|
0.46
|
|
Diluted net income per share
|
$
|
0.27
|
|
|
$
|
0.42
|
|
|
September 30,
2015
|
|
June 30,
2015
|
||||
Finished goods
|
$
|
374,045
|
|
|
$
|
384,647
|
|
Work in process
|
42,290
|
|
|
23,214
|
|
||
Purchased parts and raw materials
|
45,036
|
|
|
55,632
|
|
||
Total inventory
|
$
|
461,371
|
|
|
$
|
463,493
|
|
|
September 30,
2015
|
|
June 30,
2015
|
||||
Land
|
$
|
70,454
|
|
|
$
|
63,962
|
|
Buildings
|
71,665
|
|
|
51,959
|
|
||
Building and leasehold improvements
|
8,735
|
|
|
8,323
|
|
||
Buildings and leasehold improvements construction in progress (1)
|
2,574
|
|
|
25,572
|
|
||
Machinery and equipment
|
43,132
|
|
|
40,689
|
|
||
Furniture and fixtures
|
9,564
|
|
|
7,421
|
|
||
Purchased software
|
11,223
|
|
|
3,343
|
|
||
Purchased software construction in progress (2)
|
1,336
|
|
|
8,567
|
|
||
|
218,683
|
|
|
209,836
|
|
||
Accumulated depreciation and amortization
|
(49,534
|
)
|
|
(46,798
|
)
|
||
Property, plant and equipment, net
|
$
|
169,149
|
|
|
$
|
163,038
|
|
|
September 30,
2015
|
|
June 30,
2015
|
||||
Long-term deferred service costs
|
$
|
1,704
|
|
|
$
|
1,490
|
|
Prepaid royalty license
|
935
|
|
|
997
|
|
||
Investment in a privately held company
|
1,411
|
|
|
1,411
|
|
||
Restricted cash
|
829
|
|
|
840
|
|
||
Others
|
1,268
|
|
|
488
|
|
||
Total other assets
|
$
|
6,147
|
|
|
$
|
5,226
|
|
|
September 30,
2015
|
|
June 30,
2015
|
||||
Accrued payroll and related expenses
|
$
|
13,524
|
|
|
$
|
15,141
|
|
Customer deposits
|
4,611
|
|
|
6,314
|
|
||
Accrued warranty costs
|
7,545
|
|
|
7,700
|
|
||
Accrued cooperative marketing expenses
|
6,465
|
|
|
5,690
|
|
||
Deferred service revenue
|
7,786
|
|
|
4,085
|
|
||
Others
|
10,238
|
|
|
7,813
|
|
||
Total accrued liabilities
|
$
|
50,169
|
|
|
$
|
46,743
|
|
|
Three Months Ended
September 30,
|
||||||
|
2015
|
|
2014
|
||||
Balance, beginning of period
|
$
|
7,700
|
|
|
$
|
7,083
|
|
Provision for warranty
|
3,866
|
|
|
3,656
|
|
||
Costs charged to accrual
|
(3,819
|
)
|
|
(3,465
|
)
|
||
Change in estimated liability for pre-existing warranties
|
(202
|
)
|
|
(197
|
)
|
||
Balance, end of period
|
$
|
7,545
|
|
|
$
|
7,077
|
|
September 30, 2015
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Asset at
Fair Value
|
||||||||
Money market funds
|
$
|
311
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
311
|
|
Auction rate securities
|
—
|
|
|
—
|
|
|
2,633
|
|
|
2,633
|
|
||||
Total
|
$
|
311
|
|
|
$
|
—
|
|
|
$
|
2,633
|
|
|
$
|
2,944
|
|
|
|
|
|
|
|
|
|
||||||||
June 30, 2015
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Asset at
Fair Value
|
||||||||
Money market funds
|
$
|
310
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
310
|
|
Auction rate securities
|
—
|
|
|
—
|
|
|
2,633
|
|
|
2,633
|
|
||||
Total
|
$
|
310
|
|
|
$
|
—
|
|
|
$
|
2,633
|
|
|
$
|
2,943
|
|
|
Three Months Ended
September 30,
|
||||||
|
2015
|
|
2014
|
||||
Balance as of beginning of period
|
$
|
2,633
|
|
|
$
|
2,647
|
|
Total realized gains or (losses) included in net income
|
—
|
|
|
—
|
|
||
Total unrealized gains or (losses) included in other comprehensive income
|
—
|
|
|
—
|
|
||
Sales and settlements at par
|
—
|
|
|
—
|
|
||
Transfers in and/or out of Level 3
|
—
|
|
|
—
|
|
||
Balance as of end of period
|
$
|
2,633
|
|
|
$
|
2,647
|
|
|
September 30, 2015
|
||||||||||||||
|
Amortized
Cost
|
|
Gross
Unrealized
Holding
Gains
|
|
Gross
Unrealized
Holding
Losses
|
|
Fair Value
|
||||||||
Auction rate securities
|
$
|
2,750
|
|
|
$
|
—
|
|
|
$
|
(117
|
)
|
|
$
|
2,633
|
|
|
|
|
|
|
|
|
|
||||||||
|
June 30, 2015
|
||||||||||||||
|
Amortized
Cost
|
|
Gross
Unrealized
Holding
Gains
|
|
Gross
Unrealized
Holding
Losses
|
|
Fair Value
|
||||||||
Auction rate securities
|
$
|
2,750
|
|
|
$
|
—
|
|
|
$
|
(117
|
)
|
|
$
|
2,633
|
|
|
September 30,
|
|
June 30,
|
||||
|
2015
|
|
2015
|
||||
Line of credit:
|
|
|
|
||||
Bank of America
|
$
|
62,199
|
|
|
$
|
59,699
|
|
CTBC Bank
|
9,700
|
|
|
9,700
|
|
||
Total line of credit
|
71,899
|
|
|
69,399
|
|
||
Building term loans:
|
|
|
|
||||
Bank of America
|
3,033
|
|
|
3,733
|
|
||
CTBC Bank
|
19,875
|
|
|
21,280
|
|
||
Total building term loans
|
22,908
|
|
|
25,013
|
|
||
Total debt
|
94,807
|
|
|
94,412
|
|
||
Current portion
|
(94,574
|
)
|
|
(93,479
|
)
|
||
Long-term portion
|
$
|
233
|
|
|
$
|
933
|
|
|
•
|
|
Not to incur on a consolidated basis, a net loss before taxes and extraordinary items in any two consecutive quarterly accounting periods;
|
|
•
|
|
The Company’s funded debt to EBITDA ratio (ratio of all outstanding liabilities for borrowed money and other interest-bearing liabilities, including current and long-term debt, less the non-current portion of subordinated liabilities to EBITDA) shall not be greater than 2.00;
|
|
•
|
|
The Company’s unencumbered liquid assets, as defined in the agreement, held in the United States shall have an aggregate market value of not less than $30,000,000, measured as of the last day of each fiscal quarter and the last day of each fiscal year.
|
|
Three Months Ended
September 30,
|
||||||
|
2015
|
|
2014
|
||||
Net sales:
|
|
|
|
||||
United States
|
$
|
338,696
|
|
|
$
|
243,378
|
|
Europe
|
86,826
|
|
|
89,557
|
|
||
Asia
|
74,657
|
|
|
88,438
|
|
||
Other
|
19,439
|
|
|
21,949
|
|
||
|
$
|
519,618
|
|
|
$
|
443,322
|
|
|
September 30,
|
|
June 30,
|
||||
|
2015
|
|
2015
|
||||
Long-lived assets:
|
|
|
|
||||
United States
|
$
|
128,625
|
|
|
$
|
124,292
|
|
Asia
|
37,859
|
|
|
37,695
|
|
||
Europe
|
2,665
|
|
|
1,051
|
|
||
|
$
|
169,149
|
|
|
$
|
163,038
|
|
|
Three Months Ended
September 30,
|
||||||||||||
|
2015
|
|
2014
|
||||||||||
|
Amount
|
|
Percent of
Net Sales
|
|
Amount
|
|
Percent of
Net Sales
|
||||||
Server systems
|
$
|
356,211
|
|
|
68.6
|
%
|
|
$
|
255,609
|
|
|
57.7
|
%
|
Subsystems and accessories
|
163,407
|
|
|
31.4
|
%
|
|
187,713
|
|
|
42.3
|
%
|
||
Total
|
$
|
519,618
|
|
|
100.0
|
%
|
|
$
|
443,322
|
|
|
100.0
|
%
|
•
|
Net cash provided by operating activities was
$20.3 million
and
$27.0 million
during
the three months ended September 30, 2015 and 2014
, respectively. Our cash and cash equivalents, together with our investments, were
$113.6 million
at the end of the
first
quarter of fiscal year 2016, compared with
$98.1 million
at the end of fiscal year 2015. The increase in our cash and cash equivalents, together with our investments at the end of the first quarter of fiscal year 2016 was primarily due to
$20.3 million
of cash provided by our operating activities and $1.8 million of borrowings, net of repayments offset in part by $7.7 million of purchases of property and equipment, of which $2.8 million was related to the property and equipment of our first manufacturing building at our Green Computing Park in San Jose, California, which was completed in August 2015.
|
•
|
Days sales outstanding in accounts receivable (“DSO”) at the end of the
first
quarter of fiscal year 2016 was
55
days, compared with
43
days at the end of fiscal year 2015. The increase in our DSO was primarily due to lower sales in the quarter.
|
•
|
Our inventory balance was
$461.4 million
at the end of the
first
quarter of fiscal year 2016, compared with
$463.5 million
at the end of fiscal year
2015
. Days sales of inventory at the end of the
first
quarter of fiscal year 2016 was
95
days, compared with
83
days at the end of fiscal year 2015. The increase in our days sales of inventory was due to lower cost of goods sold from lower sales in the first quarter of fiscal year 2016 than we had anticipated.
|
•
|
Our purchase commitments with contract manufacturers and suppliers were
$392.0 million
at the end of the
first
quarter of fiscal year 2016 and
$378.3 million
at the end of fiscal year 2015. Included in the above non-cancellable commitments are hard disk drive purchase commitments totaling approximately
$201.6 million
, which have terms expiring through
December 2016
. See Note 10 of Notes to our Condensed Consolidated Financial Statements for a discussion of purchase commitments.
|
|
Three Months Ended
September 30,
|
|
Change
|
|||||||||||
|
2015
|
|
2014
|
|
$
|
|
%
|
|||||||
Server systems
|
$
|
356.2
|
|
|
$
|
255.6
|
|
|
$
|
100.6
|
|
|
39.4
|
%
|
Percentage of total net sales
|
68.6
|
%
|
|
57.7
|
%
|
|
|
|
|
|||||
Subsystems and accessories
|
163.4
|
|
|
187.7
|
|
|
(24.3
|
)
|
|
(12.9
|
)%
|
|||
Percentage of total net sales
|
31.4
|
%
|
|
42.3
|
%
|
|
|
|
|
|||||
Total net sales
|
$
|
519.6
|
|
|
$
|
443.3
|
|
|
$
|
76.3
|
|
|
17.2
|
%
|
|
Three Months Ended
September 30,
|
|
Change
|
|||||
|
2015
|
|
2014
|
|
%
|
|||
Distributors
|
45.6
|
%
|
|
56.0
|
%
|
|
(10.4
|
)%
|
OEMs and end customers
|
54.4
|
%
|
|
44.0
|
%
|
|
10.4
|
%
|
Total net sales
|
100.0
|
%
|
|
100.0
|
%
|
|
|
|
Three Months Ended
September 30,
|
|
Change
|
|||||||||||
|
2015
|
|
2014
|
|
$
|
|
%
|
|||||||
Total cost of sales
|
$
|
447.4
|
|
|
$
|
374.1
|
|
|
$
|
73.3
|
|
|
19.6
|
%
|
Total gross profit
|
72.2
|
|
|
69.2
|
|
|
$
|
3.0
|
|
|
4.4
|
%
|
||
Total gross margin
|
13.9
|
%
|
|
15.6
|
%
|
|
|
|
(1.7
|
)%
|
|
Three Months Ended
September 30,
|
|
Change
|
|||||||||||
|
2015
|
|
2014
|
|
$
|
|
%
|
|||||||
Research and development
|
$
|
28.3
|
|
|
$
|
21.5
|
|
|
$
|
6.8
|
|
|
31.7
|
%
|
Percentage of total net sales
|
5.5
|
%
|
|
4.9
|
%
|
|
|
|
|
|||||
Sales and marketing
|
14.2
|
|
|
11.0
|
|
|
3.2
|
|
|
29.5
|
%
|
|||
Percentage of total net sales
|
2.7
|
%
|
|
2.5
|
%
|
|
|
|
|
|||||
General and administrative
|
8.2
|
|
|
5.1
|
|
|
3.1
|
|
|
62.2
|
%
|
|||
Percentage of total net sales
|
1.6
|
%
|
|
1.1
|
%
|
|
|
|
|
|||||
Total operating expenses
|
50.8
|
|
|
$
|
37.6
|
|
|
$
|
13.2
|
|
|
35.2
|
%
|
|
Percentage of total net sales
|
9.8
|
%
|
|
8.5
|
%
|
|
|
|
|
|
Three Months Ended
September 30,
|
|
Change
|
|||||||||||
|
2015
|
|
2014
|
|
$
|
|
%
|
|||||||
Interest and other income, net
|
$
|
0.1
|
|
|
$
|
—
|
|
|
$
|
0.1
|
|
|
148.6
|
%
|
Interest expense
|
(0.3
|
)
|
|
(0.2
|
)
|
|
(0.1
|
)
|
|
65.3
|
%
|
|||
Interest and other expense, net
|
$
|
(0.2
|
)
|
|
$
|
(0.2
|
)
|
|
$
|
0.1
|
|
|
47.2
|
%
|
|
Three Months Ended
September 30,
|
|
Change
|
|||||||||||
|
2015
|
|
2014
|
|
$
|
|
%
|
|||||||
Provision for income taxes
|
$
|
7.5
|
|
|
$
|
10.6
|
|
|
$
|
(3.1
|
)
|
|
(29.2
|
)%
|
Percentage of total net sales
|
1.5
|
%
|
|
2.4
|
%
|
|
|
|
|
|||||
Effective tax rate
|
35.4
|
%
|
|
33.7
|
%
|
|
|
|
|
|
•
|
|
Not to incur on a consolidated basis, a net loss before taxes and extraordinary items in any two consecutive quarterly accounting periods;
|
|
•
|
|
The Company’s funded debt to EBITDA ratio (ratio of all outstanding liabilities for borrowed money and other interest-bearing liabilities, including current and long-term debt, less the non-current portion of subordinated liabilities to EBITDA) shall not be greater than 2.00;
|
|
•
|
|
The Company’s unencumbered liquid assets, as defined in the agreement, held in the United States shall have an aggregate market value of not less than $30,000,000, measured as of the last day of each fiscal quarter and the last day of each fiscal year.
|
|
Payments Due by Period
|
||||||||||||||||||
|
Less Than
1 Year
|
|
1 to 3
Years
|
|
3 to 5
Years
|
|
More Than
5 Years
|
|
Total
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Operating leases
|
$
|
4,230
|
|
|
$
|
5,783
|
|
|
$
|
5,179
|
|
|
$
|
2,715
|
|
|
$
|
17,907
|
|
Capital leases, including interest
|
210
|
|
|
367
|
|
|
140
|
|
|
—
|
|
|
717
|
|
|||||
Debt, including interest (1)
|
94,605
|
|
|
233
|
|
|
—
|
|
|
—
|
|
|
94,838
|
|
|||||
Purchase commitments (2)
|
347,641
|
|
|
44,320
|
|
|
—
|
|
|
—
|
|
|
391,961
|
|
|||||
Total (3)
|
$
|
446,686
|
|
|
$
|
50,703
|
|
|
$
|
5,319
|
|
|
$
|
2,715
|
|
|
$
|
505,423
|
|
(1)
|
Amount reflects total anticipated cash payments, including anticipated interest payments based on the interest rate at
September 30, 2015
.
|
(2)
|
Amount reflects total gross purchase commitments under our manufacturing arrangements with third-party contract manufacturers or vendors. Our purchase obligations included
$201.6 million
of hard disk drive purchase commitments at
September 30, 2015
, which will be paid through
December 2016
. See Note 10 of Notes to our Condensed Consolidated Financial Statements for a discussion of purchase commitments.
|
(3)
|
The table above excludes liabilities for deferred revenue of
$20.9 million
and unrecognized tax benefits and related interest and penalties accrual of
$11.2 million
. We have not provided a detailed estimate of the payment timing of
|
•
|
Initiation of a review of extended warranty and any other deliverables in our bill of materials for all products
|
•
|
Increased oversight and monitoring by our management of extended warranty and other deliverables in our bill of materials for any new products
|
•
|
Documenting and tracking extended warranty and other deliverables in our contract matrix to ensure proper revenue recognition
|
|
•
|
|
fluctuations based upon seasonality, with the quarters ending March 31 and September 30 typically being weaker;
|
|
•
|
|
unpredictability of the timing and size of customer orders, since most of our customers purchase our products on a purchase order basis rather than pursuant to a long term contract;
|
|
•
|
|
fluctuations in availability and costs associated with key components and other materials needed to satisfy customer requirements;
|
|
•
|
|
variability of our margins based on the mix of server systems, subsystems and accessories we sell and the percentage of our sales to internet data center cloud customers or geographical regions;
|
|
•
|
|
the timing of the introduction of new products by leading microprocessor vendors and other suppliers;
|
|
•
|
|
fluctuations based upon changes in demand for and cost of storage solutions as such solutions become an increasing percentage of our net sales;
|
|
•
|
|
changes in our product pricing policies, including those made in response to new product announcements and pricing changes of our competitors;
|
|
•
|
|
fluctuations in the timing and size of large customer orders as larger customers and larger orders become an increasing percentage of our net sales;
|
|
•
|
|
mix of whether customer purchases are of full systems or subsystems and accessories and whether made directly or through indirect sales channels;
|
|
•
|
|
the effect of mergers and acquisitions among our competitors, suppliers or partners;
|
|
•
|
|
general economic conditions in our geographic markets; and
|
|
•
|
|
impact of regulatory changes on our cost of doing business.
|
•
|
greater name recognition and deeper market penetration;
|
•
|
longer operating histories;
|
•
|
larger sales and marketing organizations and research and development teams and budgets;
|
•
|
more established relationships with customers, contract manufacturers and suppliers and better channels to reach larger customer bases and larger sales volume allowing for better costs;
|
•
|
larger customer service and support organizations with greater geographic scope;
|
•
|
a broader and more diversified array of products and services; and
|
•
|
substantially greater financial, technical and other resources.
|
•
|
heightened price sensitivity from customers in emerging markets;
|
•
|
our ability to establish local manufacturing, support and service functions, and to form channel relationships with resellers in non-U.S. markets;
|
•
|
localization of our systems and components, including translation into foreign languages and the associated expenses;
|
•
|
compliance with multiple, conflicting and changing governmental laws and regulations;
|
•
|
foreign currency fluctuations;
|
•
|
limited visibility into sales of our products by our distributors;
|
•
|
laws favoring local competitors;
|
•
|
weaker legal protections of intellectual property rights and mechanisms for enforcing those rights;
|
•
|
market disruptions created by public health crises in regions outside the U.S., such as Avian flu, SARS and other diseases;
|
•
|
difficulties in staffing and managing foreign operations, including challenges presented by relationships with workers’ councils and labor unions; and
|
•
|
changing regional economic and political conditions.
|
•
|
actual or anticipated variations in our operating results;
|
•
|
announcements of technological innovations, new products or product enhancements, strategic alliances or significant agreements by us or by our competitors;
|
•
|
changes in recommendations by any securities analysts that elect to follow our common stock;
|
•
|
the financial projections we may provide to the public, any changes in these projections or our failure to meet these projections;
|
•
|
the loss of a key customer;
|
•
|
the loss of key personnel;
|
•
|
technological advancements rendering our products less valuable;
|
•
|
lawsuits filed against us;
|
•
|
changes in operating performance and stock market valuations of other companies that sell similar products;
|
•
|
price and volume fluctuations in the overall stock market;
|
•
|
market conditions in our industry, the industries of our customers and the economy as a whole; and
|
•
|
other events or factors, including those resulting from war, incidents of terrorism or responses to these events.
|
•
|
establish a classified board of directors so that not all members of our board are elected at one time;
|
•
|
require super-majority voting to amend some provisions in our certificate of incorporation and bylaws;
|
•
|
authorize the issuance of “blank check” preferred stock that our board could issue to increase the number of outstanding shares and to discourage a takeover attempt;
|
•
|
limit the ability of our stockholders to call special meetings of stockholders;
|
•
|
prohibit stockholder action by written consent, which requires all stockholder actions to be taken at a meeting of our stockholders;
|
•
|
provide that the board of directors is expressly authorized to adopt, or to alter or repeal our bylaws; and
|
•
|
establish advance notice requirements for nominations for election to our board or for proposing matters that can be acted upon by stockholders at stockholder meetings.
|
Exhibit
Number
|
|
Description
|
10.1
|
|
Extension of Loan Agreement with Bank of America, N.A. dated November 13, 2015
|
31.1
|
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Certification of Charles Liang, President and Chief Executive Officer of the Registrant pursuant to Section 302, as adopted pursuant to the Sarbanes-Oxley Act of 2002
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31.2
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Certification of Howard Hideshima, Chief Financial Officer of the Registrant pursuant to Section 302, as adopted pursuant to the Sarbanes-Oxley Act of 2002
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32.1
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Certification of Charles Liang, President and Chief Executive Officer of the Registrant pursuant to Section 906, as adopted pursuant to the Sarbanes-Oxley Act of 2002
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32.2
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Certification of Howard Hideshima, Chief Financial Officer of the Registrant pursuant to Section 906, as adopted pursuant to the Sarbanes-Oxley Act of 2002
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101.INS
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XBRL Instance Document
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101.SCH
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XBRL Taxonomy Extension Schema Document
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101.CAL
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XBRL Taxonomy Extension Calculation Linkbase Document
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101.DEF
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XBRL Taxonomy Extension Definition Linkbase Document
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101.LAB
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XBRL Taxonomy Extension Label Linkbase Document
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101.PRE
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XBRL Taxonomy Extension Presentation Linkbase Document
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Date:
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November 16, 2015
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/s/ C
HARLES
L
IANG
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|
|
|
Charles Liang
President, Chief Executive Officer and Chairman of the
Board
(Principal Executive Officer)
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Date:
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November 16, 2015
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/s/ Howard Hideshima
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|
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Howard Hideshima
Senior Vice President, Chief Financial Officer
(Principal Financial and Accounting Officer)
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1.
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I have reviewed this annual report on Form 10-Q of Super Micro Computer, Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b.
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
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Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date:
|
November 16, 2015
|
/s/ C
HARLES
L
IANG
|
|
|
Charles Liang
President, Chief Executive Officer and
Chairman of the Board
(Principal Executive Officer)
|
1.
|
I have reviewed this annual report on Form 10-Q of Super Micro Computer, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date:
|
November 16, 2015
|
/s/ H
OWARD
H
IDESHIMA
|
|
|
Howard Hideshima
Senior Vice President, Chief Financial Officer
(Principal Financial and Accounting Officer)
|
Date:
|
November 16, 2015
|
/s/ C
HARLES
L
IANG
|
|
|
Charles Liang
President and Chief Executive Officer
(Principal Executive Officer)
|
Date:
|
November 16, 2015
|
/s/ H
OWARD
H
IDESHIMA
|
|
|
Howard Hideshima
Senior Vice President, Chief Financial Officer
(Principal Financial and Accounting Officer)
|