<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For The Quarterly Period Ended: February 28, 1998
-----------------
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For The Transition Period From To
Commission File Number: 0-14779
MEDIA 100 INC.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 04-2532613
- ------------------------------- --------------------------------
(State or other jurisdiction of (I.R.S. Employer
organization or incorporation) Identification Number)
290 DONALD LYNCH BOULEVARD
MARLBOROUGH, MASSACHUSETTS
------------------------------------------------------
(Address of principal executive offices)
01752-4748
------------------------------------------------------
(Zip code)
(508) 460-1600
------------------------------------------------------
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements
for the past 90 days.
Yes X No
---- ----
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Common Stock, par value $.01 per share 8,251,495 shares
- -------------------------------------- -----------------------------
Class Outstanding at March 31, 1998
<PAGE>
MEDIA 100 INC. AND SUBSIDIARIES
INDEX
<TABLE>
<CAPTION>
PAGE
PART I -- FINANCIAL INFORMATION NUMBER
------
<S> <C>
ITEM 1 Consolidated Financial Statements:
Consolidated Balance Sheets as of
February 28, 1998 and November 30, 1997 3
Consolidated Statements of Operations for
the three months ended February 28, 1998
and 1997 4
Consolidated Statements of Cash Flows for
the three months ended February 28, 1998
and 1997 5
Notes to Consolidated Financial Statements 6 - 8
ITEM 2 Management's Discussion and Analysis of
Financial Condition and Results of
Operations 9 - 10
PART II - OTHER INFORMATION
ITEM 1 Legal Proceedings 11
ITEM 6 Exhibits and Reports on Form 8-K 11
SIGNATURES 12
EXHIBIT INDEX 13
</TABLE>
2
<PAGE>
PART I - FINANCIAL INFORMATION
MEDIA 100 INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
February 28, November 30,
(in thousands) 1998 1997
ASSETS ------------ ------------
(unaudited)
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 3,659 $ 4,042
Marketable securities 29,634 28,892
Accounts receivable, net of reserves of
$396 in 1998 and $411 in 1997 6,917 7,689
Inventories 658 696
Prepaid expenses 709 743
------------ ------------
Total current assets 41,577 42,062
Property and equipment, net 8,253 8,104
Other assets, net 593 593
------------ ------------
Total assets $ 50,423 $ 50,759
------------ ------------
------------ ------------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 1,770 $ 1,953
Accrued expenses 7,515 6,958
Deferred revenue 4,111 4,005
------------ ------------
Total current liabilities 13,396 12,916
Commitments and contingencies (Note 6)
Stockholders' equity:
Preferred stock -- --
Common stock 82 82
Capital in excess of par value 40,690 40,477
Retained deficit (3,299) (2,547)
Cumulative translation adjustment (371) (87)
Unrealized holding loss on
available for sale securities, net (75) (82)
------------ ------------
Total stockholders' equity 37,027 37,843
------------ ------------
Total liabilities and stockholders' equity $ 50,423 $ 50,759
------------ ------------
------------ ------------
</TABLE>
The accompanying notes are an integral part of these
consolidated financial statements.
3
<PAGE>
MEDIA 100 INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended
(in thousands, except per share data) February 28,
---------------------
1998 1997
-------- -------
<S> <C> <C>
Net sales $10,521 $11,524
Cost of sales 4,093 4,361
-------- -------
Gross profit 6,428 7,163
Operating expenses:
Research and development 2,991 1,995
Selling and marketing 3,662 4,229
General and administrative 998 933
-------- -------
Total operating expenses 7,651 7,157
-------- -------
Income (loss) from operations (1,223) 6
Interest income 425 462
Other income (expense), net 58 (248)
-------- -------
Income (loss) from before
tax provision (740) 220
Tax provision 12 55
-------- -------
Net income (loss) $ (752) $ 165
-------- -------
-------- -------
Earnings (loss) per share:
Basic $ (0.09) $ .02
-------- -------
-------- -------
Diluted $ (0.09) $ .02
-------- -------
-------- -------
Weighted average common shares outstanding:
Basic 8,232 8,110
-------- -------
-------- -------
Diluted 8,232 8,284
-------- -------
-------- -------
</TABLE>
The accompanying notes are an integral part of these
consolidated financial statements.
4
<PAGE>
MEDIA 100 INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended February 28,
(in thousands) 1998 1997
---------- ---------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (752) $ 165
Adjustments to reconcile net income to net cash
provided by (used in) operating activities
Depreciation and amortization 602 278
Gain on sale of marketable securities (18) (22)
Changes in assets and liabilities
Accounts receivable 772 1,771
Inventories 38 192
Prepaid expenses 34 (173)
Accounts payable (183) (560)
Accrued expenses 557 (518)
Deferred revenue 106 444
---------- ---------
Net cash provided by operating activities $ 1,156 $ 1,577
---------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of equipment (751) (1,043)
Increase in other assets -- 24
Purchases of marketable securities (24,279) (12,621)
Proceeds from sales of marketable securities 23,562 11,452
---------- ---------
Net cash used in investing activities $ (1,468) $ (2,188)
---------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from stock plans 213 187
---------- ---------
Net cash provided by financing activities $ 213 $ 187
---------- ---------
EFFECT OF EXCHANGE RATE CHANGES ON CASH (284) (192)
---------- ---------
NET DECREASE IN CASH AND CASH EQUIVALENTS $ (383) $ (616)
CASH AND CASH EQUIVALENTS, beginning of period 4,042 2,733
---------- ---------
CASH AND CASH EQUIVALENTS, end of period $ 3,659 $ 2,117
---------- ---------
---------- ---------
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for income taxes $ 62 $ 56
---------- ---------
---------- ---------
OTHER TRANSACTIONS NOT PROVIDING (USING) CASH:
Change in value of marketable securities $ 7 $ (183)
---------- ---------
---------- ---------
</TABLE>
The accompanying notes are an integral part of these
consolidated financial statements.
5
<PAGE>
MEDIA 100 INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED, EXCEPT FOR NOVEMBER 30, 1997 AMOUNTS)
1. Basis of Presentation
The accompanying consolidated financial statements include the accounts of
Media 100 Inc. ("the Company") and its wholly-owned subsidiaries. The interim
financial statements are unaudited. However, in the opinion of management,
the consolidated financial statements and disclosures reflect all adjustments
necessary for fair presentation. Interim results are not necessarily
indicative of results expected for a full year or for any other interim
period. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to the rules
and regulations of the Securities and Exchange Commission. These consolidated
condensed financial statements should be read in conjunction with the
consolidated financial statements and the notes thereto included in the
Company's latest audited financial statements, which are included in the
Company's Annual Report on Form 10-K for the fiscal year ended November 30,
1997, filed with the Securities and Exchange Commission.
The Company's preparation of financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
2. Cash Equivalents and Marketable Securities
Cash equivalents are carried at cost, which approximates market value, and
have original maturities of less than three months. Cash equivalents include
money market accounts and repurchase agreements with overnight maturities.
The Company accounts for marketable securities in accordance with Statement
of Financial Accounting Standards No. 115, Accounting for Certain Investments
in Debt and Equity Securities (SFAS No. 115). Under this standard, the
Company is required to classify all investments in debt and equity securities
into one or more of the following three categories: held-to-maturity,
available-for-sale or trading. Available-for-sale securities are recorded at
fair market value with unrealized gains and losses excluded from earnings and
reported to stockholders' equity. All of the Company's marketable securities
are classified as available-for-sale.
Marketable securities held as of February 28, 1998, consist of the following
(in thousands):
<TABLE>
<CAPTION>
Investments available for sale: Maturity Market Value
-------- ------------
<S> <C> <C>
U.S. Treasury Notes less than 1 year $ 1,013
U.S. Treasury Notes 1 - 4 years 5,590
------------
Total U.S. Treasury Notes 6,603
Municipal Bonds less than 1 year 2,021
Municipal Bonds 1 - 2 years 511
------------
Total Municipal Bonds 2,532
U.S. Agency Bonds less than 1 year 489
U.S. Agency Bonds more than 1 year 3,531
------------
Total U.S. Agency Bonds 4,020
Investments available for sale: Maturity Market Value
-------- ------------
Money Market Instruments 9,092
Corporate Obligations less than 1 year 5,336
Corporate Obligations 1 - 3 years 2,051
------------
Total Corporate Obligations 7,387
------------
Total investments available for sale $ 29,634
------------
------------
</TABLE>
6
<PAGE>
2. Cash Equivalents and Marketable Securities (continued)
Marketable securities had a cost of $29,709 and $28,974 at February 28, 1998
and November 30, 1997, respectively, and a market value of $29,634 and
$28,892, respectively. To reduce the carrying amounts of the February 28,
1998 and November 30, 1997 marketable securities portfolios to market value,
a valuation allowance has been reflected as a separate component of
stockholders' equity pursuant to the provisions of SFAS No. 115.
3. Inventories
Inventories are stated at the lower of first-in, first-out (FIFO) cost or
market and consist of the following (in thousands):
<TABLE>
<CAPTION>
February 28, November 30,
1998 1997
------------------- ---------------------
<S> <C> <C>
Raw materials $ 301 $ 305
Work-in-process 288 252
Finished goods 69 139
------------------- ---------------------
$ 658 $ 696
------------------- ---------------------
------------------- ---------------------
</TABLE>
Work-in-process and finished goods inventories include material, labor and
manufacturing overhead. Management performs periodic reviews of inventory and
disposes of items not required by their manufacturing plan.
4. Property and equipment, net
Property and equipment, net is stated at cost, less accumulated depreciation and
amortization, and consists of the following (in thousands):
<TABLE>
<CAPTION>
February 28, November 30,
1998 1997
--------------------- ----------------------
<S> <C> <C>
Machinery and equipment $ 11,167 $ 10,428
Furniture and fixtures 1,300 1,288
Vehicles 12 12
--------------------- ----------------------
$ 12,479 $ 11,728
Less accumulated
depreciation
and amortization 4,226 3,624
--------------------- ----------------------
$ 8,253 $ 8,104
--------------------- ----------------------
--------------------- ----------------------
</TABLE>
5. Net Income (Loss) Per Common Share
In February 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 128, Earnings Per Share (SFAS No. 128). The
new standard simplifies the computation of earnings per share and increased
comparability to international standards. Under SFAS No. 128, primary earnings
per share is replaced by "Basic" earnings per share, which excludes potentially
dilutive equity instruments and is computed by dividing income available to
common shareholders by the weighted average number of common shares outstanding
for the period. "Diluted" earnings per share, which is computed similarly to
fully diluted earnings per share, reflects the potential dilution that could
occur if securities or other contracts to issue common stock were exercised or
converted into common stock.
7
<PAGE>
6. Contingencies
(i) On June 7, 1995, a lawsuit was filed against the Company by Avid Technology,
Inc. ("Avid") in the United States District Court for the District of
Massachusetts. The complaint generally alleges patent infringement by the
Company arising from the manufacture, sale, and use of the Company's Media 100
products. The complaint includes requests for injunctive relief, treble damages,
interest, costs and fees. In July 1995, the Company filed an answer and
counterclaim denying any infringement and asserting that the Avid patent in
question is invalid. The Company intends to vigorously defend the lawsuit. In
addition, Avid is seeking reissue of the patent, including claims that it
asserts are broader than in the existing patent, and these reissue proceedings
remain pending before the U.S. Patent and Trademark Office. On January 16, 1998,
the court dismissed the lawsuit without prejudice to either party moving to
restore it to the docket upon completion of all matters pending before the U.S.
Patent and Trademark Office. There can be no assurance that the Company will
prevail in the lawsuit asserted by Avid or that the expense or other effects of
the lawsuit, whether or not the Company prevails, will not have a material
adverse effect on the Company's business, operating results and financial
condition.
(ii) From time to time the Company is involved in other disputes and/or
litigation encountered in its normal course of business. The Company does not
believe that the ultimate impact of the resolution of such other outstanding
matters will have a material effect on the Company's business, operating results
or financial condition.
7. Capitalized Software Development Costs
The Company capitalizes certain computer software development costs.
Capitalization of costs commences upon establishing technological feasibility.
Capitalized costs, net of accumulated amortization, were approximately $89,000
as of February 28, 1998 and November 30, 1997, and are included in other assets.
These costs are amortized on a straight-line basis over two years, which
approximates the economic life of the product. Amortization expense, included in
cost of sales in the accompanying consolidated statements of operations, was
approximately $15,000 and $80,000 for the three months ended February 28, 1998
and twelve months ended November 30, 1997, respectively.
8. Income Taxes
Due to the net loss in the first quarter of 1998 and the Company's current
expectation that it will not be profitable for the full year ended November 30,
1998, the Company anticipates its tax liabilities for fiscal 1998 will not be
significant.
8
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Overview
Except for the historical information contained herein, the matters discussed in
this Quarterly Report on Form 10-Q are forward-looking statements based on
current expectations, and involve known and unknown risks, uncertainties and
other factors which may cause the actual results, performance or achievements of
the Company, or industry results, to be materially different from those
expressed in such forward-looking statements. The risks and uncertainties
associated with such statements have been described under the heading "Certain
Factors That May Affect Future Results" in the Company's Annual Report on Form
10-K for the fiscal year ended November 30, 1997.
Media 100 Inc. is a technology and market leader in the market for personal
computer-based digital video systems. The Media 100 family of products are
analog and digital conversion systems that enable users to capture video and
audio into a personal computer, perform random-access ("nonlinear") video
editing and audio mixing, and directly produce a finished program with
broadcast-quality picture and compact disc-quality sound, all without the use of
traditional video tape equipment.
Results of Operations
The following table shows certain consolidated statements of operations data as
a percentage of net sales.
<TABLE>
<CAPTION>
February 28, February 28,
1998 1997
----------------------- -----------------------
<S> <C> <C>
Net sales 100.0 % 100.0 %
Cost of sales 38.9 37.8
----------------------- -----------------------
Gross profit 61.1 62.2
Operating expenses:
Research and development expenses 28.4 17.3
Selling and marketing expenses 34.8 36.7
General and administrative expenses 9.5 8.1
----------------------- -----------------------
Total operating expenses 72.7 62.1
Operating income (loss) (11.6) .1
Interest income and other, net 4.6 1.8
----------------------- -----------------------
Income (loss) before income taxes (7.0) 1.9
Provision for income taxes .1 0.5
----------------------- -----------------------
Net income (loss) (7.1) % 1.4 %
----------------------- -----------------------
----------------------- -----------------------
</TABLE>
Comparison of First Fiscal Quarter of 1998 to First Fiscal Quarter of 1997
Net sales for the fiscal quarter ended February 28, 1998 were $10,521,000, a
decrease of $1,003,000, or 8.7%, from the same period a year ago. Net sales
decreased for the quarter ended February 28, 1998 primarily due to lower average
selling prices for the Company's Media 100 products. In response to competitive
pressures, the Company reduced the selling price of several of its products,
including Media 100 qx by $2,000 to $1,995, Media 100 qx with component by
$2,000 to $3,995, Media 100 xe by $2,000 to $12,995, and Media 100 xs by $7,000
to $14,995. These pricing actions resulted in lower average selling prices for
the Company's products and resulted in lower total net sales for the first
fiscal quarter of 1998; however, the lower selling prices allowed the Company to
increase the total number of systems sold over the first fiscal quarter of 1997.
Gross profit for the fiscal quarter ended February 28, 1998 was 61.1% compared
to 62.2% in the comparable quarter a year ago. This decrease in gross profit was
primarily the result of the lower average selling prices discussed above
partially offset by reductions in the cost of key component parts used in the
manufacture of the Media 100 hardware.
9
<PAGE>
Comparison of First Quarter of 1998 to First Fiscal Quarter of 1997 (continued)
Operating expenses for the fiscal quarter ended February 28, 1998 were
$7,651,000, an increase of $494,000, or 6.9%, from the same period a year ago.
Research and development expenses for the fiscal quarter ended February 28, 1998
were $2,991,000, an increase of $996,000, or 49.9%, from the same period a year
ago. In the first quarter of fiscal 1998, the Company announced its intentions
to significantly increase research and development expenditures in fiscal 1998
over fiscal 1997 to support the development of products running on the Windows
NT platform. Selling and marketing expenses for the fiscal quarter ended
February 28, 1998 were $3,662,000, a decrease of $567,000, or 13.4%, from the
same period a year ago. The decrease in selling and marketing expenses reflects
primarily reductions in headcount and advertising expenses related to the
Company's existing products. The Company expects that selling and marketing
expenses will increase from their current levels in connection with the
introduction of new products based on the Windows NT platform, which are
currently anticipated to begin shipping in the latter half of fiscal 1998.
General and administrative expenses for the quarter ended February 28, 1998 were
$998,000, an increase of $65,000, or 7.0%, from the same period a year ago. The
increase in general and administrative expenses primarily represents additional
expense for allowance for doubtful accounts.
The loss from operations for the first fiscal quarter of 1998 was $1,223,000
compared to income of $6,000 for the same period a year ago. The loss from
operations for the quarter ended February 28, 1998 was due to lower net sales,
lower gross margin and higher operating expenses primarily due to the increase
in research and development expenses.
Interest income for the fiscal quarter ended February 28, 1998 was $425,000, or
4.0% of net sales, compared to $462,000, or 4.0% of net sales, in the comparable
quarter a year ago. Other income, net of other expense, for the first fiscal
quarter of 1998 was $58,000, an increase of $306,000 over the same period a year
ago, reflecting the impact of foreign currency translations arising out of the
Company's subsidiaries.
The tax provision of $12,000 for the fiscal quarter ended February 28, 1998
compares to $55,000 for the same period a year ago. The Company currently
estimates tax liabilities for the full year of 1998 will not be material due to
an anticipated loss for fiscal 1998.
The net loss for the fiscal quarter ended February 28, 1998 was $752,000 or
$0.09 per share, compared to net income of $165,000, or $.02 per share, for the
same period a year ago.
Liquidity and Capital Resources
The Company has funded its operations to date primarily from public offerings of
equity securities and cash flows from operations. As of February 28, 1998 the
Company's principal sources of liquidity included cash and cash equivalents and
marketable securities totaling approximately $33,293,000.
In the first quarter ended February 28, 1998, cash provided by operating
activities was approximately $1,156,000 compared to approximately $1,577,000 for
the same period a year ago. Cash was generated during the three months of 1998
from an increase in deferred revenue of $106,000 and accrued expenses of
$557,000, reductions in accounts receivable of $772,000, inventory of $38,000
and prepaid expenses of $34,000. This increase in cash was partially offset by a
reduction in accounts payable of $183,000. Net cash used in investing activities
was approximately $1,468,000 during the first three months of 1998 compared to
approximately $2,188,000 for the same period a year ago. Cash used in investing
activities during the three month period ended February 28, 1998 was primarily
for purchases of machinery and equipment of approximately $751,000 and net
purchases of marketable securities of approximately $717,000. Cash provided by
financing activities during the first three months of 1998 was approximately
$213,000 compared to $187,000 for the same period a year ago. All of the cash
provided by financing activities in the first three months of 1998 came from
proceeds from the Company's stock plans.
The Company believes its existing cash balance, including cash equivalents and
marketable securities will be sufficient to meet the Company's cash requirements
for at least the next twelve months.
10
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
On June 7, 1995, a lawsuit was filed against the Company by Avid Technology,
Inc. ("Avid") in the United States District Court for the District of
Massachusetts. The complaint generally alleges patent infringement by the
Company arising from the manufacture, sale, and use of the Company's Media 100
products. The complaint includes requests for injunctive relief, treble damages,
interest, costs and fees. In July 1995, the Company filed an answer and
counterclaim denying any infringement and asserting that the Avid patent in
question is invalid. The Company intends to vigorously defend the lawsuit. In
addition, Avid is seeking reissue of the patent, including claims that it
asserts are broader than in the existing patent, and these reissue proceedings
remain pending before the U.S. Patent and Trademark Office. On January 16, 1998,
the court dismissed the lawsuit without prejudice to either party moving to
restore it to the docket upon completion of all matters pending before the U.S.
Patent and Trademark Office. There can be no assurance that the Company will
prevail in the lawsuit asserted by Avid or that the expense or other effects of
the lawsuit, whether or not the Company prevails, will not have a material
adverse effect on the Company's business, operating results and financial
condition.
Item 6. Exhibits and Reports on Form 8-K
a) Exhibits
Exhibits required as part of this Quarterly Report on Form 10-Q are listed in
the exhibit index on page 13.
b) Reports on Form 8-K
No reports on Form 8-K have been filed during the quarter for which this report
is filed.
11
<PAGE>
SIGNATURES
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 thereunto duly authorized.
Media 100 Inc.
Date: April 14, 1998 By: /s/ Steven D. Shea
------------------------
Steven D. Shea
Corporate Controller and
Chief Accounting Officer
12
<PAGE>
EXHIBIT INDEX
Number Description
27 Financial Data Schedule
13
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEET ON FORM 10Q FOR THE PERIOD ENDED FEBRUARY 28, 1998
AND THE CONSOLIDATED STATEMENT OF OPERATIONS AS FILED ON FORM 10Q FOR THE THREE
MONTHS ENDED FEBRUARY 28, 1998 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> NOV-30-1998
<PERIOD-START> DEC-01-1997
<PERIOD-END> FEB-28-1998
<CASH> 3,659
<SECURITIES> 29,634
<RECEIVABLES> 7,313
<ALLOWANCES> 396
<INVENTORY> 658
<CURRENT-ASSETS> 41,577
<PP&E> 12,479
<DEPRECIATION> 4,226
<TOTAL-ASSETS> 50,423
<CURRENT-LIABILITIES> 13,396
<BONDS> 0
0
0
<COMMON> 82
<OTHER-SE> 36,945
<TOTAL-LIABILITY-AND-EQUITY> 37,027
<SALES> 10,521
<TOTAL-REVENUES> 10,521
<CGS> 4,093
<TOTAL-COSTS> 4,093
<OTHER-EXPENSES> 7,651
<LOSS-PROVISION> 200
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (740)
<INCOME-TAX> 12
<INCOME-CONTINUING> (752)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (752)
<EPS-PRIMARY> (.09)
<EPS-DILUTED> (.09)
</TABLE>
