Press Releases

Macromedia Reports Third Quarter Fiscal Year 2004 Results

Macromedia, Inc (Nasdaq: MACR)
Summary Financial Results
(in millions, except per share data)

Three Months Ended December 31

Nine Months Ended
December 31

  2003 2002 2003 2002
Net Revenues $94.8 $83.2 $267.8 $253.3
Net income (loss) per diluted share – GAAP $0.15 $0.14 $0.39 $(0.09)
Net income per diluted share – pro forma $0.18 $0.14 $0.44 $0.27

Download Q304 Financials - Excel file (46K)

San Francisco, CA—January 21, 2004Macromedia (Nasdaq: MACR) today announced its third quarter fiscal year 2004 financial results. Net revenues for the three months ended December 31, 2003 were $94.8 million, compared with net revenues of $83.2 million reported in the comparable period a year ago. Net income for the three months ended December 31, 2003 was $10.3 million or $0.15 per diluted share, compared to net income of $8.3 million or $0.14 per diluted share for the comparable period a year ago. Pro forma net income for the third quarter of fiscal year 2004 was $12.9 million or $0.18 per diluted share, compared to pro forma net income of $8.6 million or $0.14 per diluted share for the comparable period a year ago.

"Our good results this quarter were a function of a number of positive developments, including: successful international launches of the MX 2004 products; accelerated growth in new product lines such as Breeze, Contribute, and mobile; increased effectiveness of our expanding direct sales force; and strong growth in international markets, particularly Asia and Europe," said Rob Burgess, chairman and CEO, Macromedia. "I’m quite pleased that we finished the calendar year with such solid results across the board."

Business Initiatives Update

During the quarter ended December 31, 2003, Macromedia continued to advance its agenda in its three key markets of design/development, information convenience, and mobile solutions. Macromedia saw substantial increases in the number, size, and strategic value of deals from the worldwide field organization.

Macromedia also completed its acquisition of eHelp Corporation in December, bringing new versions of RoboHelp and RoboInfo to market this week while smoothly maintaining the existing business, integrating processes, and exploring synergies for future opportunities.


Macromedia made major progress in the design/development market in the December quarter. The Company:

  • Saw successful launches of the MX 2004 products across Europe, Latin America, and Japan;
  • Announced in January that the newest MX 2004 product, Director MX 2004, which includes DVD-video playback, JavaScript support, and Macromedia Flash integration, will ship in the coming weeks;
  • Held the highly successful MAX developer conference, which more than 2,000 customers attended in November; and
  • Previewed Macromedia Flex, a server solution for programmers to develop in Flash, which is expected to ship in the first half of calendar year 2004.

Information Convenience

The information convenience solutions gained significant traction this past quarter. Macromedia:

  • Saw Breeze bookings more than double sequentially, fueled by positive references and increased global sales activities;
  • Reported strong improvements in Macromedia Contribute, with 32 percent sequential growth from last quarter and an increase in volume deployments;
  • Formed a partnership with Affinity Internet that combines Contribute 2 with website hosting services to further help reach the small business market; and
  • Delivered a developer release of Macromedia Central and announced that it is working with America Online to enable Flash developers to build Central applications that take advantage of presence and other instant messaging features found in the AOL Instant Messenger and ICQ services.


There were also advancements in mobile initiatives this quarter:

  • There were nine partnership deals signed to embed Flash into devices, with particular strength in Asia and Japan. Partner companies include Samsung, Inventec, Essnet, HUMAX, Parker Hannifin, and Tcom.
  • In early January, Macromedia announced the appointment of Juha Christensen as president of its mobile and devices business unit. An industry leader, Christensen previously served as corporate vice president of the mobile devices division at Microsoft Corporation, and also co-founded Symbian Ltd., whose cross-vendor operating system is emerging as an industry standard.
  • NTT DoCoMo unveiled their latest 3G FOMA phones, the 900i series, which all use Flash Lite and are set to ship in early 2004.

Business Outlook – Fourth Quarter Fiscal Year 2004

For the quarter ending March 31, 2004, Macromedia expects net revenues to be in the range of $92 to $98 million, with pro forma gross margins in the 90 to 91 percent range, and a pro forma operating profit margin between 10 and 15 percent. For the fiscal year ending March 31, 2004, the Company expects net revenues to increase from the previous fiscal year by 5 to 10 percent, and expects to deliver a pro forma operating profit margin of between 10 and 15 percent. These forward looking statements are subject to risks and uncertainties discussed below; therefore, actual results may differ materially from such forward-looking statements.

Pro Forma Results

Macromedia’s pro forma results for the three and nine months ended December 31, 2003 and 2002 differ from results reported under U.S. GAAP due to adjustments for the following items reported in its condensed consolidated results from operations:

  • Non-cash charges for:

    • The amortization of deferred stock compensation resulting from the issuance of stock options to employees at an exercise price below the fair-market value on the date of grant;
    • The amortization and impairments of acquired developed technology and intangible assets;
    • The write off of in-process research and development related to the acquisition of eHelp;
    • Gains and losses on cost-basis and available-for-sale equity investments as well as a gain on the sale of acquired technology;
    • Litigation charges and settlements included in Other income.

Pro forma results for the three and nine months ended December 31, 2003 and 2002 reflect an assumed tax rate of 20 percent. See the attached financial table for a reconciliation of GAAP and pro forma results.

Conference Call

Macromedia’s third quarter fiscal year 2004 financial results teleconference is scheduled to begin at 2:30 p.m. Pacific Time / 5:30 p.m. Eastern Time on Wednesday, January 21, 2004. In addition to the teleconference, a Macromedia Breeze presentation will be available on our website before the teleconference begins. To access the presentation, please visit After the conclusion of the teleconference, a replay of the conference call will be available on the company’s website.

About Macromedia
Experience matters. Macromedia is motivated by the belief that great experiences build great businesses. Our software empowers millions of business users, developers, and designers to create and deliver effective, compelling and memorable experiences – on the Internet, on fixed media, on wireless, and on digital devices.

Cautionary Note about Forward Looking Statements
Matters discussed in this news release may be considered forward looking statements, including those under the heading "Business Outlook" that relate to expected future financial results which involve risks and uncertainties. Such risks and uncertainties include those related to customer acceptance of new products and services and new versions of existing products, risks associated with integration of acquired products and technologies, the risk of adequately evolving our internal systems and processes in a dynamic business environment, the risk of delays in product development and release dates, new regulations and other legislative actions that may materially increase the cost of compliance and doing business, risks associated with participating in international markets, including, but not limited to, foreign policies, market instability, and regulations in the applicable foreign countries, the impact of competition, the economic condition in the domestic and significant international markets in which the Company operates, dependence on the growth of the Internet, quarterly fluctuations of the operating results, the dependence on distributors and risks of product returns, risk associated with potential litigation and intellectual property ownership claims against the Company and others in the industry, volatility of the Company’s stock and other risks detailed from time to time in the Company’s filings with the SEC, including without limitation, its annual report on Form 10-K for the fiscal year ended March 31, 2003, and its quarterly reports on Form 10-Q, as they may be updated or amended with future filings. The actual results the Company achieves may differ materially from any forward looking statements due to such risks and uncertainties.

NOTE: Macromedia, the Macromedia logo, Macromedia Breeze, Macromedia Central, Macromedia Contribute, Director, Macromedia Flash, Macromedia Flex, RoboHelp, and RoboInfo are trademarks or registered trademarks of Macromedia, Inc., which may be registered in the United States and internationally. Other product or service names mentioned herein are the trademarks of their respective owners.