BSQUARE CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (dollars in thousands)
September 30, 2007 (Unaudited) December 31, 2006
ASSETS Current assets: Cash and cash equivalents ......................................................................... $ 4,626 Short-term investments.............................................................................. 7,768 Accounts receivable, net of allowance for doubtful accounts of $198 at September 30, 2007 and $198 at December 31, 2006 ......................... 8,952 Prepaid expenses and other current assets................................................. 364 Total current assets.................................................................................. 21,710 Equipment, furniture and leasehold improvements, net ............................. 867 Intangible assets, net ................................................................................... — Restricted cash ............................................................................................ 1,050 Other non-current assets ............................................................................. 56 Total assets .............................................................................................. $ 23,683 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Accounts payable ...................................................................................... $ Other accrued expenses ............................................................................. Accrued compensation .............................................................................. Accrued legal fees ..................................................................................... Deferred revenue ....................................................................................... Total current liabilities ............................................................................ Deferred rent ............................................................................................... Commitments and contingencies
$ 2,483 7,426 7,167 421 17,497 821 101 1,200 57 $ 19,676
2,875 2,796 1,340 534 866 8,411 337
$ 2,634 2,877 1,046 534 154 7,245 355
Shareholders’ equity: Preferred stock, no par value: 10,000,000 shares authorized; no shares — issued and outstanding .............................................................................. Common stock, no par value: 37,500,000 shares authorized; 9,932,339 shares issued and outstanding at September 30, 2007 and 9,617,755 shares issued and outstanding at December 31, 2006 .............. 120,783 (414) Accumulated other comprehensive loss...................................................... Accumulated deficit .................................................................................... (105,434) Total shareholders’ equity....................................................................... 14,935 Total liabilities and shareholders’ equity ................................................ $ 23,683
— 119,229 (180) (106,973) 12,076 $ 19,676
BSQUARE CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data) (Unaudited)
Three Months Ended September 30, 2007 2006 Nine Months Ended September 30, 2007 2006
Revenue: Software ................................................................... $ 8,951 $ 7,454 $ 28,328 $ 24,354 Service...................................................................... 4,653 4,041 15,466 11,370 Total revenue ......................................................... 13,604 11,495 43,794 35,724 Cost of revenue: Software ................................................................... 6,692 5,893 21,451 19,427 (1) Service .................................................................. 3,429 2,775 11,356 8,146 Total cost of revenue ............................................. 10,121 8,668 32,807 27,573 Gross profit.......................................................... 3,483 2,827 10,987 8,151 Operating expenses: Selling, general and administrative (1) ...................... 2,614 2,500 8,214 7,524 Research and development (1)................................... 573 682 1,716 2,095 Total operating expenses ...................................... 3,187 3,182 9,930 9,619 Income (loss) from operations.................................... 296 (355) 1,057 (1,468) 120 719 322 Interest and other income ........................................... 152 Income (loss) before income taxes ............................. 448 (235) 1,776 (1,146) (237) Income tax expense .................................................... (89) (26) — Net income (loss)........................................................ $ 359 $ (235) $ 1,539 $ (1,172) Basic income (loss) per share ..................................... $ Diluted income (loss) per share.................................. $ Shares used in calculation income (loss) per share: Basic ......................................................................... Diluted ...................................................................... 0.04 0.03 $ (0.02) $ $ (0.02) $ 0.16 0.15 $ (0.12) $ (0.12)
9,908 10,359
9,589 9,589
9,803 10,155
9,580 9,580
(1) Includes the following amounts related to non-cash stock-based compensation expense: Cost of revenue - service........................................................................ Selling, general and administrative ........................................................ Research and development .................................................................... Total stock-based compensation expense .............................................. $ 100 234 23 357 $ $ 45 120 20 185 $ 208 524 56 788 $ $ 127 332 55 514
$
$