MoSys, Inc. Reports Second Quarter 2007 Financial Results

SUNNYVALE, Calif.--July 31, 2007--MoSys, Inc. (MoSys), (NASDAQ: MOSY), the industry's leading provider of high-density system-on-chip (SoC) embedded memory intellectual property (IP), today reported financial results for its second quarter ended June 30, 2007.

Second Quarter Highlights

Total revenue for the second quarter of 2007 was $4.3 million, representing a 38 percent increase compared to $3.1 million in the first quarter of 2007. Second quarter total revenue increased 85 percent as compared to $2.3 million for the second quarter of 2006.

Second quarter total revenue included $2.1 million of licensing revenue as compared to $1.1 million in the first quarter of 2007, representing a sequential increase of 86 percent, and $1.7 million in the second quarter of 2006. Royalty revenue was $2.2 million as compared to $2.0 million in the previous quarter and $639,000 in the same period a year ago. The Company recorded licensing revenue from 14 different chip development projects compared to 12 projects in the previous quarter, and royalty revenue from 16 different licensees, which was consistent with the previous quarter.

The second quarter gross margin percentage determined in accordance with U.S. generally accepted accounting principles (GAAP) was 84 percent as compared to 82 percent in the first quarter of 2007 and 84 percent in the second quarter of 2006.

Total operating expenses were $4.9 million as compared to $4.7 million in the first quarter of 2007.

On a GAAP basis, net loss for the quarter was $146,000, or breakeven per share, including stock-based compensation charges of $794,000. This compares to a net loss of $969,000, or ($0.03) per share, in the previous quarter and a net loss of $2.1 million, or ($0.07) per share, in the second quarter of 2006. Earnings per share for the quarter on a GAAP basis were computed using 31,945,000 shares.

The non-GAAP net income for the second quarter of 2007, which excludes the total stock-based compensation charges of $794,000, was $648,000, or $0.02 fully diluted per share. Net income per share for the quarter on a non-GAAP basis was computed using 32,882,000 shares. A reconciliation of GAAP results to non-GAAP results is provided in the financial statement tables following the text of this press release.

Cash, cash equivalents and long and short-term investments totaled approximately $87.6 million as of June 30, 2007, an increase from the approximately $84.3 million as of December 31, 2006.

"During the second quarter, we signed another Technology License agreement for our 1T-SRAM(R) at an advanced process node. This agreement will enable NEC Electronics (NEC) to incorporate our 1T-SRAM technology onto their 55nm process for use in chip implementations targeting next-generation consumer, graphics and networking applications," stated Chet Silvestri, CEO of MoSys, Inc. "This agreement aligns with our strategy to sign technology license agreements with major semiconductor manufacturers at the most advanced process nodes and is further evidence of the scalability of our technology. In addition to our technology license progress, we are pleased with the growth in royalties that we are achieving due to the incorporation of our 1T-SRAM technology into the Nintendo Wii game console. The success of this game console is contributing to quarter-over-quarter growth in royalty revenues and increasing the visibility of our 1T-SRAM technology in the marketplace."

"With respect to our other major technology initiative, we announced the tape-out of our first 1T-FLASH(TM) memory macro during the quarter. This macro completes an important milestone in our first customer licensing agreement and signals the beginning of our market roll-out of this technology to other customers," continued Mr. Silvestri.

Mr. Silvestri continued, "In another important milestone for the quarter, we announced the acquisition of a number of Mixed Signal chip designs from Atmel Corporation. One of these chip designs is an Analog Front End (AFE) targeted at the High Definition/Blue Ray DVD market. Another chip design is an 8 port Gigabit Switch, which is targeted at the networking market. These product acquisitions support our strategy to further penetrate the high-volume consumer multimedia and networking markets and complements our 1T-SRAM and 1T-FLASH(TM) memory IP offerings. By expanding our technology portfolio with these products, we can offer our licensees a more complete set of IP to support their system solutions."

Business Outlook

The Company's Chief Executive Officer and Chief Financial Officer will comment further on the highlights of the second quarter and provide additional financial details on the Company's business outlook during their conference call at 1:30 p.m. (PT) on Tuesday, July 31, 2007.

Financial Tables

Click here to read financial tables

Second Quarter 2007 Financial Results Webcast / Conference Call

MoSys management will host a conference call and webcast with investors today, July 31, 2007, at 1:30 p.m. Pacific time (4:30 p.m. Eastern time) to discuss the second quarter 2007 financial results and the business outlook. Investors and other interested parties may access the call by dialing 1-866-203-3206 in the U.S. (1-617-213-8848 outside of the U.S.), and entering the passcode 69285920 at least 10 minutes prior to the start of the call. In addition, an audio webcast will be available through the MoSys website at http://www.mosys.com. A telephonic replay will be available for 48 hours following the call at 888-286-8010 in the U.S. (617-801-6888 outside of the U.S.), passcode of 58674627.

About MoSys, Inc.

Founded in 1991, MoSys (Nasdaq:MOSY), develops, licenses and markets industry-leading embedded memory IP for semiconductors. MoSys' patented 1T-SRAM(R) and 1T-FLASH(TM) technologies offer a combination of high density, low power consumption, high speed and low cost that is unmatched by other memory technologies. MoSys licensees have shipped more than 110 million chips incorporating 1T-SRAM, demonstrating excellent manufacturability in a wide range of silicon processes and applications. MoSys is headquartered at 755 N. Mathilda Avenue, Sunnyvale, California 94085. More information is available at http://www.mosys.com. 1T-SRAM is a registered trademark and 1T-FLASH is a trademark of MoSys, Inc.