Slide 1: UTStarcom Holdings Corp. Second Quarter 2014 Results
UTStarcom Holdings Corp. Second Quarter 2014 Results NASDAQ: UTSI August 15, 2014 Mr. Himanshu Shah, Chairman of the Board Mr. William Wong, CEO Mr. Robert Pu, CFO Mr. Lin Song, CEO of iTV Media Inc. 1
Slide 2: Disclosure & Forward Looking Statements
Disclosure & Forward Looking Statements This investor presentation contains forward-looking statements, including statements regarding the Company's expectation regarding its strategic initiatives and business outlook. Forward-looking statements are based on current expectations, estimates, forecast
Slide 3: Earnings Call Agenda
3 Earnings Call Agenda Comments from the New Chairman of the Board Update on Operating Progress Our Portfolio Company – iTV Media Our Go-forward Strategy Overview of Second Quarter 2014 Results Company Outlook 1 2 3 4 5 6
Slide 4: Comments from the New Chairman of the Board
Comments from the New Chairman of the Board 4
Slide 5: Update on Operating Progress
Update on Operating Progress 5
Slide 6: Operating Highlights
Operating Highlights 6 We continued to make great strides in setting the stage for global growth and there were several operational highlights in the second quarter: Completed a successful proof of concept test of our Software Defined Networking (SDN) technology, which will evolve into a new product
Slide 7: Driving The Broadband Business
Driving The Broadband Business 7 Packet Optical Transport TN765, a premier product that we introduced earlier in the year, is showing early signs of sales momentum. We have begun the final acceptance process with a tier one operator in Japan and received order for commercial trial. Wi-Fi Data Offloa
Slide 8: Strategic Investment in New Media
Strategic Investment in New Media 8 We remain committed to our investments in iTV Media and aioTV. As the single largest investor in both companies, we continue to benefit through their growth and the development of their businesses while exploring ways to package their media services and technology
Slide 9: Our Portfolio Company – iTV Media
Our Portfolio Company – iTV Media 9
Slide 10: iTV Media
iTV Media 10 iTV Media continues to make progress in deploying the TV-over-IP service that it has launched with Thailand’s largest telecom operator, TOT. Continue to see dramatic customer adoption of our service package. MeTV, iTV Media’s business entity in Thailand, is expected to be operating cash
Slide 11: Our Go-forward Strategy
@ Our Go-forward Strategy 1"
Slide 12: Post-restructuring plan initiatives
Our post-restructuring plan includes several specific initiatives: The core of our strategy is growing our broadband business, which will be the primary revenue contributor. Formally opened new Silicon Valley office in June to serve as an R&D and product testing lab as well as to house product demon
Slide 13: Our Go-forward Strategy
We will maximize our investment return in iTV Media and aioTV We benefit as an investor in the appreciation of the value of their businesses. Our investments in iTV Media and aioTV provide opportunities for UTStarcom to market new media products to our broadband customers. These investments are yiel
Slide 14: Overview of Second Quarter 2014 Results
Overview of Second Quarter 2014 Results 14
Slide 15: Financial Highlights
15 Financial Highlights Revenue was better than expected in the second quarter. Gross margin improved sequentially. Continued to make significant OPEX reduction year over year. Maintained a strong balance sheet with $95.1 million in cash and no debt.
Slide 16: Total Revenue
Total Revenue Total revenue for the second quarter of 2014 were $31.9 million versus $47.7 million for the second quarter of 2013. 16 Total revenues for the first half of 2014 were $64.2 million versus $84.9 million for the first half of 2013. US$ in millions US$ in millions
Slide 17: Gross Profit
Gross Profit 17 Gross profit was $6.4 million for the second quarter of 2014, compared to $9.6 million for the second quarter of 2013. Gross profit was $11.0 million for the second quarter of 2014, compared to $21.2 million for the second quarter of 2013. US$ in millions US$ in millions
Slide 18: Gross Margin
Gross Margin 18 Gross margin was 20.1% for the second quarter of 2014, compared to 20.0% for the second quarter of 2013. Gross margin was 17.1% for the first half of 2014, compared to 25.0% for the first half of 2013.
Slide 19: Operating Expenses
Operating Expenses 19 Operating expenses were $9.2 million for the second quarter of 2014, a decrease of 14.7% from $10.8 million for the second quarter of 2013. Operating expenses were $17.1 million for the first half of 2014, a decrease of 34.3% from $26.1 million for the first half of 2013. US$ i
Slide 20: Operating Loss
Operating Loss 20 Operating loss was $2.8 million for the second quarter of 2014, compared to operating loss of $1.3 million for the second quarter of 2013. Operating loss was $6.1 million for the first half of 2014, compared to operating loss of $4.9 million operating loss for the first half of 201
Slide 21: Net Loss
Net Loss 21 Net loss was $4.6 million for the second quarter of 2014, compared to net loss of $2.1 million for the second quarter of 2013. US$ in millions Net loss was $7.9 million for the first half of 2014, compared to net loss of $7.1 million for the first half of 2013. US$ in millions
Slide 22: Cash Flow Analysis
Cash balance of $95.1 million in cash, cash equivalents and short-term investment, and no debt. Cash used in operating activities for the second quarter of 2014 was $3.5 million. Cash used in investing activities for the second quarter of 2014 was $2.9 million. Cash from financing activities for the
Slide 23: Company Outlook
Company Outlook 23
Slide 24: Company Outlook
24 The Company is still moving through a transition post-restructuring. New products are in early stages of their product life cycle. The Company is fully committed to broadband as the driver of our business and new products will become solid revenue contributors beginning in later part of 2014. The
Slide 25: Investor Relations Contacts
Investor Relations Contacts UTStarcom, Investor Relations Jane Zuo Tel: +852-3750-7632 Email: jane.zuo@utstar.com FTI Consulting, Inc. May Shen (Beijing) Tel: +86-10-8591-1951 Email: May.Shen@fticonsulting.com Daniel DelRe (Hong Kong) Tel: +852-3768-4547 Email: Daniel.DelRe@fticonsulting.com Simona