PDF Solutions Inc. (NASDAQ:PDFS) Q2 2019 Earnings Conference Call - Final Transcript

Aug 01, 2019 • 05:00 pm ET

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PDF Solutions Inc. (NASDAQ:PDFS) Q2 2019 Earnings Conference Call - Final Transcript

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Presentation
Executive
Christine Russell

typically, in the 70% to 80% range.

Now let's look at operating expenses, which we held flat sequentially, at $12.6 million. This reflects our disciplined approach to spending. We continued to add resources, judiciously, in sales and marketing, while looking for other opportunities to eliminate unnecessary expenses. So turning to the bottom-line, we posted non-GAAP net profit of $1 million, up 25% from the prior quarter. Non-GAAP earnings per share in the quarter was $0.03. Shares outstanding for Q2 were $32.3 million, which reflects our share repurchase of 300,000 shares.

Now, we'll turn our attention to the balance sheet. Cash at the end of Q2 was $86.8 million, a reduction of $3.6 million. As I noted earlier, the reduction was discretionary as it reflects our share repurchase. We generated over $5 million in cash from operations and funded the acquisition of StreamMosaic and continuation of the DFI eProbe 250 as well. John mentioned the collections issue we have with one large customer. As he discussed, we're confident in our contractual rights and the standard of work delivered. We believe we will eventually collect the past due receivables as well as future revenue to which we are entitled. We can't predict how long this may take. We've decided to stop work and defer the Q2 revenue generated by this customer. This resulted in lower Q2 revenue for us.

Looking at DSO after removing the impact of this contract, DSO would have been 135 days. Other than this one customer, we have not experienced any significant collection problems. We do expect DSO to improve when we resolve some transitory administrative issues with two other customers, that should eventually reduce DSO by another 30 days.

We'll now turn the call over to the operator for any questions. Operator?