Excite Inc – ‘8-K’ for 12/31/98

As of:  Monday, 1/25/99   ·   For:  12/31/98   ·   Accession #:  891618-99-207   ·   File #:  0-28064

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Current Report   —   Form 8-K
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Document/Exhibit                   Description                      Pages   Size 

 1: 8-K         Current Report                                         5     22K 

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8-K
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================================================================================

 UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
 Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934

 Date of Report (Date of earliest event reported): DECEMBER 31, 1998

EXCITE, INC.
--------------------------------------------------------------------------------
(Exact name of Registrant as specified in its charter)

DELAWARE
------------------------------------------------------
(State or other jurisdiction of incorporation)

                                                                [Download Table]
                                                                                
        0-28064                                               77-0378215        
---------------------------                            -------------------------
       (Commission                                           (IRS Employer      
      File Number)                                        Identification No.)   

555 Broadway, Redwood City, CA                             94063  
--------------------------------------------------------------------------------
(Address of principal executive offices)                       (Zip Code)     

(650) 568-6000
--------------------------------------------------------------------------------
(Registrant's telephone number, including area code)

NOT APPLICABLE
--------------------------------------------------------------------------------
 (Former name or former address, if changed since last report)

================================================================================

8-K
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ITEM 5:  OTHER EVENTS                                                           

The Company's revenue of $54.1 million for the fourth quarter ended   
December 31, 1998, was up 163% from the $20.5 million for the corresponding     
fourth quarter of 1997. Revenue for the fourth quarter represented a 23%        
sequential increase over the $44.0 million reported in the third quarter of     
1998.                                                                           

    The net loss for the fourth quarter of 1998 was $5.8 million, or $0.11 per
share. These results compare to a net loss of $13.0 million, or $0.39 per share,
for the corresponding quarter of the prior year.                                

   For the total year, the Company generated revenue of $154.1 million and a
net loss of $37.0 million, or $0.78 per share. For 1997, the Company generated  
revenue of $54.1 million, and a net loss of $41.4 million, or $1.47 per share.  

The Company has taken the initiative to conform its accounting for    
acquisition-related in-process research and development charges in response to  
recent Securities and Exchange Commission interpretative guidelines.            
Accordingly, the Company has reduced this charge to $6.2 million from the $16.2 
million charge it recorded in the Second Quarter of 1998 to reflect the         
acquisition of Throw, Inc., a small technology company. The $10.0 million       
reduction in the value of the in-process technology, will be capitalized as     
goodwill and amortized over 3 years. Amortization related to the Throw          
acquisition for the fourth quarter and total year amounted to $0.9 million and  
$2.7 million, respectively.                                                     

The Company generated $25 million in cash flow from operations in the 
fourth quarter. Cash on hand at December 31, 1998 increased $21.3 million to    
$61.6 million, principally due to significantly improved cash collections. Days 
sales outstanding improved 15 days to 61 during the quarter.                    

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EXCITE, INC.
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 (UNAUDITED, IN THOUSANDS EXCEPT PER SHARE DATA)

                                                        [Enlarge/Download Table]

                                                      THREE MONTHS ENDED                TWELVE MONTHS ENDED       
                                                         DECEMBER 31,                       DECEMBER 31,          
                                                -------------------------------   --------------------------------
                                                    1998             1997               1998             1997     
                                                --------------  ---------------   --------------   ---------------
                                                                                                         (1)      
                                                                                                                  
Revenues (2)                                      $   54,095      $   20,548        $  154,105       $   54,114   

Cost of revenues:                                                                                                 
 Hosting costs                                         5,259           2,532            16,161            8,586   

 Royalties and other cost of revenues                  4,037           1,994            12,912            4,235   

 Amortization of purchased technology                     --           1,938                --            8,214   

                                                 --------------  ---------------   --------------   --------------
     Total cost of revenues                            9,296           6,464            29,073           21,035   
                                                 --------------  ---------------   --------------   --------------
Gross profit                                          44,799          14,084           125,032           33,079   

Operating expenses:                                                                                               
  Research and development                             7,863           5,679            29,205           16,694   

  Sales and marketing                                 21,086          10,671            62,372           32,009   

  Distribution license fees and data                   6,894           4,412            21,723            9,365   
  acquisition costs                                                                                               

  General and administrative                           5,625           3,508            16,573            9,477   

  In-process technology                                   --              --             6,200            2,346   

  Merger and acquisition related costs,                                                                           
   including amortization of goodwill and                829           2,043             4,903            3,989   
   other purchased intangibles                                                                                    

 Amortization of prepaid Netscape service              7,574              --            17,673               --   
                                                 --------------  ---------------   --------------   --------------
     Total operating expenses                         49,871          26,313           158,649           73,880   
                                                 --------------  ---------------   --------------   --------------
Operating loss                                        (5,072)        (12,229)          (33,617)         (40,801)  

Interest expense and other, net                         (239)           (277)           (1,223)            (114)  

Equity share of losses of affiliated company            (490)           (477)           (2,134)            (477)  
                                                 --------------  ---------------   --------------  ---------------
Net loss                                          $   (5,801)     $  (12,983)       $  (36,974)      $  (41,392)  
                                                 ==============  ===============   ==============   ==============
Basic and diluted net loss per share (3)          $    (0.11)      $   (0.39)        $   (0.78)       $   (1.47)  
                                                 ==============  ===============   ==============   ==============
Shares used in computing net loss per share (3)       51,511          33,231            47,475           28,155   
                                                 ==============  ===============   ==============   ==============

(1)  Derived from audited consolidated financial statements at December 31,     
1997.                                                                 

(2)  Related party revenue was $5.2 million and $8.3 million for the three and  
twelve months ended December 31, 1998, respectively.                  

(3)  All of the share and per share data have been adjusted to reflect the      
two-for-one stock split for stockholders of record as of the close of 
business on July 6, 1998.                                             

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EXCITE, INC.
 CONDENSED CONSOLIDATED BALANCE SHEETS
 (UNAUDITED, IN THOUSANDS)

                                                        [Enlarge/Download Table]

                                                                              DECEMBER 31,       DECEMBER 31,  
                                                                                 1998               1997       
                                                                          ------------------  -----------------
                                                                                                     (1)       
                                                                                                               
ASSETS                                                                                                         
Current assets:                                                                                                
     Cash, cash equivalents and short-term investments                      $     61,605        $     32,066   
     Accounts receivable, net                                                     36,592              20,907   
     Prepaid Netscape distribution costs and trademarks, current portion          45,473                  --   
     Prepaid expenses and other current assets                                     4,848               2,149   
                                                                          ------------------  -----------------
       Total current assets                                                      148,518              55,122   

Property and equipment, net                                                       35,937              15,143   
Investment in affiliated company                                                   2,243                  --   
Prepaid Netscape distribution costs and trademarks                                20,954                  --   
Intangible assets, net                                                             8,792               1,771   
Other assets                                                                       4,229               4,657   
                                                                          ------------------  -----------------
                                                                            $    220,673        $     76,693   
                                                                          ==================  =================
LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities:                                                      
     Bank line of credit and other notes payable                            $      6,100        $      6,100   
     Accounts payable                                                             13,079               5,717   
     Accrued compensation                                                          9,038               4,794   
     Related party liabilities                                                     5,092               1,575   
     Capital lease obligations, current portion                                    7,133               3,178   
     Non-lease financing, current portion                                          1,531               1,176   
     Deferred revenue                                                              2,843               4,588   
     Other accrued liabilities                                                    14,222               5,024   
                                                                          ------------------  -----------------
       Total current liabilities                                                  59,038              32,152   

Capital lease obligations                                                         11,668               3,076   
Non-lease financing                                                                1,568               1,613   
Convertible note                                                                   5,000               5,000   
Stockholders' equity                                                             143,399              34,852   
                                                                          ------------------   ----------------
                                                                            $    220,673        $     76,693   
                                                                          ==================  =================

(1)  Derived from audited consolidated financial statements at December 31,     
1997.                                                                 

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 SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934,  
Registrant has duly caused this Report to be signed on its behalf by the        
undersigned thereunto duly authorized.                                          

          EXCITE, INC.

Date:  January 25, 1999                By: /s/ Robert C. Hood                   
                                      --------------------------------
                    Robert C. Hood
                               Executive Vice President,
                                      Chief Administrative Officer and
                             Chief Financial Officer

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Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘8-K’ Filing		Date		First		Last			Other Filings
Filed on:		1/25/99		5
For Period End:		12/31/98		1		3			10-K,  10-K/A
		7/6/98		3					S-3/A
		12/31/97		3		4			10-K
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