DTS Inc. (NASDAQ:DTSI) Q4 2015 Earnings Conference Call - Final Transcript

Mar 02, 2016 • 04:30 pm ET


DTS Inc. (NASDAQ:DTSI) Q4 2015 Earnings Conference Call - Final Transcript


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Good day, ladies and gentlemen, and thank you for standing by. Welcome to the DTS Fourth Quarter and Fiscal Year 2015 Earnings Conference Call. [Operator Instructions]. Again, this call is being recorded today, Wednesday, March 2, 2016.

I would now like to turn the call over to Geri Weinfeld of DTS Investor Relations. Geri, please go ahead.

Geri Weinfeld

Good afternoon, everyone. Thanks for joining us as we report fourth quarter and fiscal year 2015 financial results. With me on the call today are Jon Kirchner, Chairman and CEO; Mel Flanigan, CFO; and Brian Towne, President, Asia-Pacific.

Before we begin, I would like to provide two reminders. First, today's discussion contains forward-looking statements that are predictions, projections or other statements about future events, which are based on management's current expectations and beliefs, and therefore subject to risks, uncertainties and changes in circumstances. Please refer to the Risk Factors section in our SEC filings, including our most recent forms 10-K and 10-Q for more information on the risks and uncertainties that could cause our actual results to differ materially from what we discuss today. Please note that the company does not intend to update or alter these forward-looking statements to reflect events or circumstances arising after this call.

Second, we refer to certain non-GAAP financial measures, which exclude charges for stock-based compensation, amortization of intangibles, acquisition and integration, realignment and certain legal expenses and the related tax effects if any, and impute an estimated 30% effective tax rate on the pre-tax earnings of the company. We have provided reconciliations of these non-GAAP measures to the most directly comparable GAAP measures in the earnings release and on the Investor Relations section of our website. The recording of this conference call will be available on our Investor Relations website at www.dts.com, an unauthorized recording of this webcast is not permitted.

Now, I'll turn the call over to Jon.

Jon E. Kirchner

Thanks, Geri. Fourth quarter revenue and earnings were solid, driven primarily by iBiquity and strong game console production. Although 2015 was a challenging year in some respects. We materially advanced the development of ecosystems and the network-connected markets for our mobile and wireless audio solutions. In addition, the acquisition of iBiquity has expanded our position in the automotive market, increased the scale and profitability of our business, and strengthened our best-in-class suite of audio solutions, putting us in a very strong position for 2016 and beyond.

Before getting into some of the progress we made during 2015, I want to quickly address some of the challenges we faced last year and provide an update on where things stand. Following the launch of Headphone:X on the Qualcomm chip, we engaged with a number of partners eager to integrate the technology on their flagship phones. However, we discovered that many of them want Headphone:X on multiple platforms with a greater ability to customize our solutions. As planned, we've now expanded the availability of Headphone:X on multiple platforms and have developed customizable implementations of Headphone:X that address these issues. I'll touch