TeleNav 2012 Annual Report Download - page 58

Table of Contents
satisfy our financial obligations through at least the next 12 months. However, we expect to use cash in operating activities in fiscal 2014 and we may
experience greater than expected cash usage in operating activities, revenue that is lower than we anticipate, or greater than expected cost of revenue
or operating expenses. Our revenue and operating results could be lower than we anticipate if, among other reasons, our customers, two of which we
are substantially dependent upon for a large portion of our revenue, were to limit or terminate our relationships with them; we were to fail to
successfully compete in our highly competitive market, including against competitors who offer their services for free; our wireless carrier customers
were to elect not to market and distribute our mobile navigation services to end users; or our wireless carrier customers were to elect to lower the
prices charged to their subscribers for our service. In the future, we may acquire businesses or technologies or license technologies from third parties,
and we may decide to raise additional capital through debt or equity financing to the extent we believe this is necessary to successfully complete
these acquisitions or license these technologies. However, additional financing may not be available to us on favorable terms, if at all, at the time we
make such determinations, which could have a material adverse effect on our business, operating results, financial condition and liquidity and cash
position.
Net cash provided by operating activities . Net cash provided by operating activities was $42.9 million , $29.3 million and $106.7 million in
fiscal 2013 , 2012 and 2011 , respectively. Cash provided by operating activities has historically been affected by growth in our end user base and
increases in our operating costs, which are primarily due to increased headcount and royalty payments for portions of the content provided in our
services. In fiscal 2013 , cash provided by operating activities was provided principally by net income of $13.1 million , non-cash charges for
depreciation and amortization of $8.4 million, stock-based compensation of $8.6 million and a $7.1 million change in our operating assets and
liabilities. In fiscal 2012, cash provided by operating activities was generated principally by net income of $32.4 million, non-cash charges for
depreciation and amortization of $8.2 million and stock-based compensation of $5.1 million, partially offset by a $20.4 million change in our
operating assets and liabilities. In fiscal 2011, cash provided by operating activities was provided principally by net income of $42.6 million, non-
cash charges for depreciation and amortization of $7.7 million and stock-based compensation of $4.1 million and $50.6 million from changes in our
operating assets and liabilities.
Net cash used in investing activities . We used net cash in investing activities of $0.2 million , $36.7 million and $187.7 million during fiscal
2013 , 2012 and 2011 , respectively. In fiscal 2013 , cash was used primarily for our acquisition of ThinkNear of $18.3 million and purchases of
property and equipment of $2.2 million, which were offset by proceeds from sales and maturities of short-term investments, net of purchases, of
$22.2 million. In fiscal 2012, the cash was used primarily for purchases of property and equipment of $13.5 million ($7.3 million of which was
related to tenant improvements in our new headquarters building), internal software development costs of $2.4 million and net purchases of $18.0
million of short-term investments. In fiscal 2011, the cash was used primarily for purchases of property and equipment of $4.9 million, internal
software development costs of $1.2 million and net purchases of $181.6 million of short-term investments. We expect to increase our capital
expenditures in future periods as we continue to invest in the infrastructure needed to operate our services for an increasing end user base.
Net cash used in financing activities . During fiscal 2013 , 2012 and 2011 , we used cash in our financing activities of $23.9 million , $9.6
million and $7.7 million, respectively. In fiscal 2013 , 2012 and 2011 , repurchases of our outstanding stock under our stock repurchase programs
were partially offset by proceeds from the exercise of options for our common stock.
Contractual obligations, commitments and contingencies
We generally do not enter into long term minimum purchase commitments. However, we have agreed to pay minimum annual license fees to
certain of our third party content providers. Our principal commitments, in addition to those related to our third party content providers, consist of
obligations under facility leases for office space in Sunnyvale and Culver City, California; Northlake, Washington; Reston, Virginia; Southfield,
Michigan; Boston, Massachusetts; Shanghai, China; Xi’an, China; and São Paulo, Brazil.
The following table summarizes our outstanding noncancelable contractual obligations as of June 30, 2013 :
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Payments due by period
Total
Less than
1 Year
1-3 Years 3-5 Years
More than
5 Years
(in thousands)
Operating lease obligations(1)
$
31,055
$
5,134
$
8,173
$
10,221
$
7,527
Purchase obligations(2)
12,252
8,356
3,896
—
—
Total contractual obligations
$
43,307
$
13,490
$
12,069
$
10,221
$
7,527
(1)
Consists of contractual obligations for office space under noncancelable operating leases, net of sublease income.