ACADEMIA

Silicon Graphics today reported a wider net loss for its fiscal first quarter, after unveiling a restructuring plan last month that will cut jobs and potentially save the struggling company up to $100 million a year. Revenue for the first quarter fiscal year 2006 was $170 million, gross margin was 37.8% and the operating loss was $26 million. For comparison, in the first quarter FY05, revenue was $175 million, gross margin was 35.9% and the operating loss was $26 million. The first quarter fiscal year 2006 net loss was $32 million or $0.12 per share, compared with a net loss of $28 million or $0.11 per share one year ago. The company delayed filing its annual financial report with the SEC in September to evaluate its ability to obtain new financing and continue operating. GAAP operating expenses for the first fiscal quarter were $90 million compared with $89 million in the same quarter last year. Non-GAAP operating expenses were $83 million in the first quarter compared with $86 million the same quarter last year excluding restructuring charges of $7 million and $3 million, respectively. "We achieved several important goals in the first quarter," said Bob Bishop, chairman and chief executive officer. "We grew revenue from core products year over year, exceeded our margin targets, secured new financing and are on-track with our restructuring plans. We still have work to do, but we are making progress." Unrestricted cash, cash equivalents and marketable investments on September 30, 2005 were $77 million as compared with $64 million at the end of fiscal 2005. Separately, SGI today announced that it has completed a new asset based credit facility with Wells Fargo Foothill, Inc. and Ableco Finance LLC that will provide availability of up to $100 million. This agreement replaces the previous facility which provided availability of up to $50 million.