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Masimo Reports First Quarter 2016 Financial ResultsMasimo (NASDAQ: MASI) today announced its financial results for the first quarter ended April 2, 2016. First quarter 2016 product revenues rose 10.8% to $163.3 million, compared to $147.4 million for the first quarter of fiscal year 2015, and total revenue, including royalties, rose 10.8% to $171.2 million, up from $154.5 million for the first quarter of fiscal year 2015. The company's worldwide direct product revenue in the first quarter of 2016 rose by 12.7% compared to the same period in 2015 and represented 86.3% of product revenue. OEM sales, which accounted for 13.7% of product revenue, rose by 0.2% to $22.3 million in the first quarter of 2016 compared to the same period in 2015. Revenue from sales of Masimo rainbow® products rose by 39.2% to $16.9 million in the first quarter of 2016, compared to the same period in 2015. GAAP net income for the first quarter of 2016 was $27.6 million, or $0.53 per diluted share, compared to GAAP net income of $20.5 million, or $0.38 per diluted share, in the first quarter of 2015. During the first quarter of 2016, the company shipped 46,300 SET® pulse oximeters and rainbow® pulse CO-Oximeters, excluding handheld units. Masimo estimates its worldwide installed base as of April 2, 2016 to be 1,438,000 units, up 7.3% from 1,340,000 units as of April 4, 2015. Joe Kiani, Chairman and Chief Executive Officer of Masimo, said, "We are happy to report results for the first quarter exceeded our expectations. Our strong revenue growth is the result of increasing demand for both our SET® Pulse (News - Alert) Oximetry and rainbow SET™ Pulse CO-Oximetry™ technologies, as well as increasing demand from our new products. Given the strong Q1 results and our continued optimism about the rest of the year, we are happy to be in a position to raise our full year 2016 financial guidance." During the first quarter of 2016, the company generated $18.8 million in cash from operations and as of April 2, 2016, total cash and cash investments were $139.9 million compared to $132.3 million as of January 2, 2016. Also, during the first quarter of 2016, the company repurchased approximately 1.1 million shares of stock for $42.9 million. 2016 Financial Guidance Masimo today is updating its 2016 financial guidance. Masimo now expects fiscal 2016 total revenues to be approximately $677 million, up from $670 million. Total fiscal 2016 product revenues are now expected to be approximately $647 million, up from $640 million, while royalty revenue expectations have not changed from the previous estimate of approximately $30 million. Masimo now also expects its fiscal 2016 GAAP earnings per diluted share to be $1.83, up from $1.69. Masimo will provide additional financial information during the conference call today. Each of the components of Masimo's guidance set forth above is an estimate only and actual performance could differ. Conference Call Masimo will hold a conference call today at 1:30 p.m. PT (4:30 p.m. ET) to discuss the results. A live webcast of the call will be available online from the investor relations page of the company's website at www.masimo.com. The dial-in numbers are (888) 520-7182 for domestic callers and +1 (706) 758-3929 for international callers. The reservation code for both dial-in numbers is 95558540. After the live webcast, the call will be available on Masimo's website through May 18, 2016. In addition, a telephonic replay of the call will be available through June 3, 2016. The replay dial-in numbers are (855) 859-2056 for domestic callers and +1 (404) 537-3406 for international callers. Please use reservation code 95558540. About Masimo Masimo (NASDAQ: MASI) is a global leader in innovative noninvasive monitoring technologies. Our mission is to improve patient outcomes and reduce the cost of care by taking noninvasive monitoring to new sites and applications. In 1995, the company debuted Masimo SET® Measure-through Motion and Low Perfusion™ pulse oximetry, which has been shown in multiple studies to significantly reduce false alarms and accurately monitor for true alarms. Masimo SET® is estimated to be used on more than 100 million patients in leading hospitals and other healthcare settings around the world. In 2005, Masimo introduced rainbow® Pulse CO-Oximetry technology, allowing noninvasive and continuous monitoring of blood constituents that previously could only be measured invasively, including total hemoglobin (SpHb®), oxygen content (SpOC™), carboxyhemoglobin (SpCO®), methemoglobin (SpMet®), and more recently, Pleth Variability Index (PVI®) and Oxygen Reserve Index (ORI™), in addition to SpO2, pulse rate and perfusion index (PI). In 2014, Masimo introduced Root®, an intuitive patient monitoring and connectivity platform with the Masimo Open Connect™ (MOC-9™) interface. Masimo is also taking an active leadership role in mHealth with products such as the Radius-7™ wearable patient monitor and the MightySat™ fingertip pulse oximeter. Additional information about Masimo and its products may be found at www.masimo.com. Forward-Looking Statements All statements other than statements of historical facts included in this press release that address activities, events or developments that we expect, believe or anticipate will or may occur in the future are forward-looking statements including, in particular, the statements about our expectations for full fiscal year 2016 total, product and royalty revenues and GAAP earnings per diluted share; demand for our products; anticipated revenue and earnings growth; our financial condition, results of operations and business generally; expectations regarding our ability to design and deliver innovative new noninvasive technologies and reduce the cost of care; and demand for our technologies. These forward-looking statements are based on management's current expectations and beliefs and are subject to uncertainties and factors, all of which are difficult to predict and many of which are beyond our control and could cause actual results to differ materially and adversely from those described in the forward-looking statements. These risks include, but are not limited to, those related to: our dependence on Masimo SET® and Masimo rainbow® SET® products and technologies for substantially all of our revenue; any failure in protecting our intellectual property exposure to competitors' assertions of intellectual property claims; the highly competitive nature of the markets in which we sell our products and technologies; any failure to continue developing innovative products and technologies; the lack of acceptance of any of our current or future products and technologies; obtaining regulatory approval of our current and future products and technologies; the risk that the implementation of our international realignment will not continue to produce anticipated operational and financial benefits, including a continued lower effective tax rate; the loss of our customers; the failure to retain and recruit senior management; product liability claims exposure; a failure to obtain expected returns from the amount of intangible assets we have recorded; the maintenance of our brand; the amount and type of equity awards that we may grant to employees and service providers in the future; our ongoing litigation and related matters; and other factors discussed in the "Risk Factors" section of our most recent periodic reports filed with the Securities and Exchange Commission ("SEC (News - Alert)"), including our most recent Form 10-K and Form 10-Q, all of which you may obtain for free on the SEC's website at www.sec.gov. Although we believe that the expectations reflected in our forward-looking statements are reasonable, we do not know whether our expectations will prove correct. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, even if subsequently made available by us on our website or otherwise. We do not undertake any obligation to update, amend or clarify these forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. Masimo, SET, Signal Extraction Technology, Improving Patient Outcome and Reducing Cost of Care... by Taking Noninvasive Monitoring to New Sites and Applications, rainbow, SpHb, SpOC, SpCO, SpMet, PVI are trademarks or registered trademarks of Masimo Corporation
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