UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  October 25, 2006

FORMFACTOR, INC.

(Exact name of Registrant as specified in its charter)

Delaware

(State or other jurisdiction of incorporation)

 

 

(925) 290-4000

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions (See General Instruction A.2.):

o   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02.          Results of Operations and Financial Condition.

On October 25, 2006, FormFactor, Inc. issued a press release announcing its financial results for the third quarter ended September 30, 2006.  A copy of the press release is furnished as Exhibit 99.1 to this report and is incorporated herein by reference.

Item 9.01.                              Financial Statements and Exhibits.

Exhibit
Number		Exhibit Title or Description
99.1		Press release dated October 25, 2006.

 

The information in this current report and the accompanying exhibit shall not be incorporated by reference into any filing of FormFactor with the Securities and Exchange Commission, whether made before or after the date hereof, regardless of any general incorporation language in such filing, unless expressly incorporated by specific reference in such filing. The information in this report, including the accompanying exhibit, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: October 25, 2006	FORMFACTOR, INC.
	By:	/s/	RONALD C. FOSTER
			Ronald C. Foster
			Chief Financial Officer

 

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EXHIBIT INDEX

Exhibit
Number		Exhibit Title or Description
99.1		Press release dated October 25, 2006.

 

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EXHIBIT 99.1

News Release

Contacts:
FormFactor, Inc.	StreetSmart Investor Relations
Ron C. Foster	Brooke Deterline
Chief Financial Officer	Annie Leschin
(925) 290-4024	(925) 290-4949
	IR@FormFactor.com

 

FOR IMMEDIATE RELEASE

FormFactor, Inc. Announces 2006 Third Quarter Financial Results

Record Quarterly Revenue of $96.8 Million, Up 55% Year over Year

LIVERMORE, Calif. — October 25, 2006 — FormFactor, Inc. (Nasdaq: FORM) today announced its financial results for the third quarter of fiscal 2006, ended September 30, 2006. Quarterly revenues were $96.8 million, up 5% from $92.4 million in the second quarter of fiscal 2006, and up 55% from $62.4 million in the third quarter of fiscal 2005.

“FormFactor had another record quarter as revenue, production and net income reached historical highs.  Demand for advanced probe cards in the third quarter continued to reflect the ongoing trends in the market including customers’ ramping production for memory and logic, the transition to advanced nodes, and the ongoing need for higher parallelism in wafer test.” said Joseph Bronson, President of FormFactor. “Factory capacity continued to ramp, as production efficiencies and yields increased in many segments of our manufacturing operations.”

Net income for the third quarter of fiscal 2006 was $15.8 million or $0.33 per share on a fully diluted basis, which included $3.9 million or $0.08 per share of incremental FAS 123 (R) stock option expense, net of tax. This compares to $15.3 million or $0.32 per share on a fully diluted basis for the second quarter of fiscal 2006, which included $2.8 million or $0.06 per share of incremental FAS 123 (R) stock option expense, net of tax. Net income for the third quarter of fiscal 2005 was $9.8 million or $0.23 per share on a fully diluted basis, which was prior to the adoption of FAS 123 (R).

Bookings for the third quarter of fiscal 2006 were $90.5 million. Bookings for the second quarter of fiscal 2006 and third quarter of fiscal 2005 were $96.5 million and $62.9 million, respectively.

“We are pleased with our 63% revenue growth year-to-date,” said Igor Khandros, Chief Executive Officer of FormFactor. “We are encouraged by customers’ interest in our new Harmony™ NAND Flash product. We are confident in business growth opportunities in 2007 and beyond, driven by our robust product development pipeline, supporting multiple growth drivers in our customers’ businesses.”

The company has posted its revenue breakdown by region and market segment on the Investors section of its website at www.formfactor.com. FormFactor will conduct a conference call at 1:30 p.m. PDT,

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or 4:30 p.m. EDT, today. The public is invited to listen to a live web cast of FormFactor’s conference call on the Investors section of the company’s website at www.formfactor.com. An audio replay of the conference call will also be made available approximately two hours after the conclusion of the call. The audio replay will remain available until October 27, 2006 at 6:30 p.m. PDT and can be accessed by dialing (888) 286-8010 or (617) 801-6888 and entering confirmation code 19398524.

About FormFactor:

Founded in 1993, FormFactor, Inc. (Nasdaq: FORM) is the leader in advanced wafer probe cards, which are used by semiconductor manufacturers to electrically test integrated circuits, or ICs. The company’s wafer sort, burn-in and device performance testing products move IC testing upstream from post-packaging to the wafer level, enabling semiconductor manufacturers to lower their overall production costs, improve yields, and bring next-generation devices to market. FormFactor is headquartered in Livermore, California with operations in Europe, Asia and North America. For more information, visit the company’s website at www.formfactor.com.

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FormFactor and MicroSpring are registered trademarks of FormFactor, Inc.  All other product, trademark, company or service names mentioned herein are the property of their respective owners.

Statements in this press release that are not strictly historical in nature are forward-looking statements within the meaning of the federal securities laws, including statements regarding business momentum, operations, demand for our products and future growth. These forward-looking statements are based on current information and expectations that are inherently subject to change and involve a number of risks and uncertainties. Actual events or results might differ materially from those in any forward-looking statement due to various factors, including, but not limited to: the demand for certain semiconductor devices; the rate at which semiconductor manufacturers implement manufacturing capability changes, make the transition to smaller nanometer technology nodes and implement tooling cycles; the company’s ability to continue to ramp its factory capacity and increase production efficiencies and yields in its manufacturing operations and to expand globally, including to execute on its global manufacturing roadmap; the company’s ability to develop and deliver innovative technologies, including its Harmony™ NAND Flash product, and to enforce its intellectual property rights; and the company’s ability to drive its product development pipeline and support multiple growth drivers in its customers’ businesses. Additional information concerning factors that could cause actual events or results to differ materially from those in any forward-looking statement is contained in the company’s Form 10-K for the fiscal period ended December 31, 2005 and the company’s Form 10-Q for the quarterly period ended July 1, 2006, filed with the Securities and Exchange Commission (“SEC”), and subsequent SEC filings. Copies of the company’s SEC filings are available at http://investors.formfactor.com/edgar.cfm. The company assumes no obligation to update the information in this press release, to revise any forward-looking statements or to update the reasons actual results could differ materially from those anticipated in forward-looking statements.

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FORMFACTOR, INC.

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share data)

(Unaudited)

 

		Three Months Ended						Nine Months Ended
		September 30, 2006			September 24, 2005			September 30, 2006			September 24, 2005
Revenues		$	96,757		$	62,374		$	270,520		$	165,676
Cost of revenues		46,492			34,088			130,699			93,484
Gross margin		50,265			28,286			139,821			72,192
Operating expenses:
Research and development		11,994			7,881			33,397			19,461
Selling, general and administrative		19,321			11,871			53,034			31,283
Total operating expenses		31,315			19,752			86,431			50,744
Operating income		18,950			8,534			53,390			21,448
Interest income		4,485			1,116			10,196			2,912
Other income (expense), net		59			(630		)	45			(655		)
		4,544			486			10,241			2,257
Income before income taxes		23,494			9,020			63,631			23,705
Benefit from (provision for) income taxes		(7,675		)	758			(21,763		)	(4,004		)
Net income		$	15,819		$	9,778		$	41,868		$	19,701
Net income per share:
Basic		$	0.34		$	0.25		$	0.94		$	0.50
Diluted		$	0.33		$	0.23		$	0.90		$	0.47
Weighted-average number of shares used in per share calculations:
Basic		46,417			39,733			44,625			39,343
Diluted		48,494			41,762			46,690			41,492

 

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FORMFACTOR, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share data)

(Unaudited)

 

		September 30,			December 31,
		2006			2005
ASSETS
Current assets:
Cash and cash equivalents		$	276,365		$	31,217
Marketable securities		181,128			180,391
Accounts receivable, net of allowance for doubtful accounts of $74 as of September 30, 2006 and December 31, 2005		54,097			43,967
Inventories		26,317			18,404
Deferred tax assets		11,233			11,396
Prepaid expenses and other current assets		12,674			7,169
Total current assets		561,814			292,544
Restricted cash		2,250			2,250
Property and equipment, net		87,398			81,588
Deferred tax assets		6,270			4,518
Other assets		994			461
Total assets		$	658,726		$	381,361
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable		$	27,346		$	26,369
Accrued liabilities		21,850			20,467
Income tax payable		7,653			9,697
Deferred rent		353			313
Deferred revenue and customer advances		6,556			3,588
Total current liabilities		63,758			60,434
Deferred rent and other long term liabilities		4,559			3,138
Total liabilities		68,317			63,572
Stockholders’ equity:
Common stock, $0.001 par value		47			40
Additional paid in capital		496,296			268,291
Deferred stock-based compensation		—			(2,495		)
Accumulated other comprehensive loss		(114		)	(359		)
Retained earnings		94,180			52,312
Total stockholders’ equity		590,409			317,789
Total liabilities and stockholders’ equity		$	658,726		$	381,361