Delaware | 0-12695 | 94-2669985 |
(State of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
6024 Silver Creek Valley Road, San Jose, California 95138 |
(Address of principal executive offices) (Zip Code) |
Emerging growth company o |
Exhibit No. | Description |
99.1 | Press Release Dated October 30, 2017 |
Dated: | October 30, 2017 | |
INTEGRATED DEVICE TECHNOLOGY, INC. | ||
By: | /S/ BRIAN C. WHITE | |
Brian C. White | ||
Senior Vice President and Chief Financial Officer (duly authorized officer) |
Exhibit No. | Description |
Press Release Dated October 30, 2017. |
Financial Contact: | Press Contact: | |
Suzanne Schmidt IDT Investor Relations Phone: (408) 284-6515 E-mail: ir@idt.com | Krista Pavlakos IDT Director, Communications Phone: (408) 574-6640 E-mail: krista.pavlakos@idt.com |
• | IDT’s Auto and Industrial revenue has increased by over 30 percent on an organic basis, versus the year ago quarter. New product releases in sensor signal conditioners, position sensors, and custom products are all delivering growth and strong design in traction. |
• | IDT commenced sampling of advanced solid state flow sensor modules to its growing portfolio of industry-leading sensor products. The cutting edge solid-state sensor element design eliminates cavities and diaphragms often found in competitive offerings and features a protective silicon-carbide coating, making it the industry's most robust and reliable flow sensor element also compatible with food-grade applications. |
• | IDT announced that they have surpassed a milestone shipment of 30 million ICs of Qi-based wireless power transmitters utilizing leading-edge, high efficiency, IDT wireless power platforms. |
• | IDT announced its collaboration with Samsung to deliver fast wireless charging for Samsung's next-level Note device, the new Galaxy Note8, featuring Samsung's most advanced wireless charging capabilities to date. |
• | IDT announced an extremely small size, low power family of programmable clocks for wearable, medical, and portable applications. The MicroClock™ devices retains the very popular VersaClock™ product family’s programming and innovations, and also will enable new applications such as ultraportable cameras, wearables, and health devices. |
• | IDT announced that it is sampling a portfolio of millimeter wave beamformer products for 5G next generation communications systems. These products accelerate IDT's growth in the RF market and consolidate its position as a leading supplier of RF and millimeter wave (mmWave) products for wireless infrastructure |
• | IDT demonstrated its latest 200G VCSEL and DML Drivers, and TIA ICs at ECOC 2017. This newest family of 2- and 4-channel PAM4 CDR/Retimers, 1x and 4x VCSEL and DML Drivers, and TIAs will help address current datacenter challenges, enabling IDT's customers to upgrade hyper-scale datacenter and cloud computing infrastructure from 100G to 200G and beyond. |
• | IDT introduced new versions of its low-power VersaClock(R) 3S programmable clock generators. These new devices are ideal for computing systems, digital cameras, IP set-top boxes, home entertainment, audio systems, multi-function printers, IoT gateways, small-business storage, smart devices, medical equipment and automotive infotainment. |
• | Revenue for the fiscal second quarter of 2018 was $204.4 million. This compared with $196.7 million reported last quarter, and $184.1 million reported in the same period one year ago. |
• | GAAP net income for the fiscal second quarter of 2018 was $18.7 million, or $0.14 per diluted share, versus GAAP net income of $16.7 million or $0.12 per diluted share last quarter, and GAAP net income of $24.6 million or $0.18 per diluted share in the same period one year ago. Fiscal second quarter GAAP results include $16.1 million in acquisition-related and restructuring charges, $13.0 million in stock-based compensation, $3.7 million in non-cash interest expense, $0.8 million in certain unrealized foreign exchange gain and $2.5 million provision in related tax effects. |
• | Non-GAAP net income for the fiscal second quarter of 2018 was $48.1 million or $0.35 per diluted share, compared with non-GAAP net income of $45.3 million or $0.33 per diluted share last quarter, and non-GAAP net income of $47.4 million or $0.34 per diluted share reported in the same period one year ago. |
• | GAAP gross profit for the fiscal second quarter of 2018 was $116.8 million, or 57.1 percent, compared with GAAP gross profit of $110.0 million or 55.9 percent last quarter, and $106.5 million, or 57.9 percent, reported in the same period one year ago. Non-GAAP gross profit for the fiscal second quarter of 2018 was $125.5 million, or 61.4 percent, compared with non-GAAP gross profit of $120.7 million, or 61.4 percent last quarter, and $111.4 million, or 60.5 percent, reported in the same period one year ago. |
• | GAAP R&D expense for the fiscal second quarter of 2018 was $48.7 million, compared with GAAP R&D expense of $48.4 million last quarter, and $41.8 million reported in the same period one year ago. Non-GAAP R&D expense for the fiscal second quarter of 2018 was $41.3 million, compared with non-GAAP R&D expense of $40.3 million last quarter, and $35.3 million in the same period one year ago. |
• | GAAP SG&A expense for the fiscal second quarter of 2018 was $44.5 million, compared with GAAP SG&A expense of $41.9 million last quarter, and $37.4 million in the same period one year ago. Non-GAAP SG&A expense for the fiscal second quarter of 2018 was $31.2 million, compared with non-GAAP SG&A expense of $30.8 million last quarter, and $28.2 million in the same period one year ago. |
• | Amortization of acquisition-related intangibles, which include acquired intangibles such as purchased technology, patents, customer relationships, trademarks, backlog and non-compete agreements. |
• | Acquisition-related costs such as legal, accounting and other professional or consulting fees directly related to an acquisition. |
• | Fair market value adjustment to acquired inventory sold. |
• | Severance costs directly related to a restructuring action. |
• | Facility closure costs consist of ongoing costs associated with the exit of our leased and owned facilities. |
• | Gain on divestiture consists of gains recognized upon the strategic sale of business units. |
• | Assets impairments including accelerated depreciation of certain assets no longer in use. |
• | Stock based compensation expense. |
• | Compensation expense (benefit) - deferred compensation, consists of gains and losses on marketable equity securities related to our deferred compensation arrangements. |
• | Non-cash interest expense, consists of amortization of issuance cost and accretion of discount related to the convertible notes. |
• | Loss (gain) on deferred compensation plan securities represents the changes in the fair value of the assets in a separate trust that is invested in corporate owned life insurance under our deferred compensation plan. |
• | Unrealized foreign currency gains and losses resulting from remeasurement of certain non-functional currency account balances. |
• | Tax effects of non-GAAP adjustments. Non-GAAP tax calculation is based on estimated cash tax expense and reserves. The Company forecasts its annual cash tax liability and allocates the tax to each quarter in proportion to earnings for that period. This approach is designed to enhance the ability of investors to understand the impact of the Company's tax expense on its current operations, provide improved modeling accuracy, and substantially reduce fluctuations caused by GAAP to non-GAAP adjustments, which may not reflect actual cash tax expense. |
• | Diluted weighted average shares non-GAAP adjustment, for purposes of calculating non-GAAP diluted net income per share, the GAAP diluted weighted average shares outstanding is adjusted to exclude the benefits of stock compensation expense attributable to future services not yet recognized in the financial statements that are treated as proceeds assumed to be used to repurchase shares under the GAAP treasury method. |
INTEGRATED DEVICE TECHNOLOGY, INC. | ||||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||
(In thousands, except per share data) | ||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
October 1, 2017 | July 2, 2017 | October 2, 2016 | October 1, 2017 | October 2, 2016 | ||||||||||||||||
Revenues | $ | 204,398 | $ | 196,713 | $ | 184,059 | $ | 401,111 | $ | 376,187 | ||||||||||
Cost of revenues | 87,636 | 86,675 | 77,527 | 174,311 | 161,306 | |||||||||||||||
Gross profit | 116,762 | 110,038 | 106,532 | 226,800 | 214,881 | |||||||||||||||
Operating expenses: | ||||||||||||||||||||
Research and development | 48,742 | 48,449 | 41,750 | 97,191 | 91,398 | |||||||||||||||
Selling, general and administrative | 44,485 | 41,942 | 37,415 | 86,427 | 76,231 | |||||||||||||||
Total operating expenses | 93,227 | 90,391 | 79,165 | 183,618 | 167,629 | |||||||||||||||
Operating income | 23,535 | 19,647 | 27,367 | 43,182 | 47,252 | |||||||||||||||
Interest and other expense, net | (4,886 | ) | (3,915 | ) | (2,597 | ) | (8,801 | ) | (5,093 | ) | ||||||||||
Income before income taxes | 18,649 | 15,732 | 24,770 | 34,381 | 42,159 | |||||||||||||||
Benefit from (provision for) income taxes | 31 | 982 | (179 | ) | 1,013 | 3,379 | ||||||||||||||
Net income | $ | 18,680 | $ | 16,714 | $ | 24,591 | $ | 35,394 | $ | 45,538 | ||||||||||
Basic net income per share | $ | 0.14 | $ | 0.13 | $ | 0.18 | $ | 0.27 | $ | 0.34 | ||||||||||
Diluted net income per share | $ | 0.14 | $ | 0.12 | $ | 0.18 | $ | 0.26 | $ | 0.33 | ||||||||||
Weighted average shares: | ||||||||||||||||||||
Basic | 133,269 | 133,302 | 134,186 | 133,286 | 134,059 | |||||||||||||||
Diluted | 136,059 | 136,642 | 137,206 | 136,434 | 137,698 | |||||||||||||||
INTEGRATED DEVICE TECHNOLOGY, INC. | ||||||||||||||||||||
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (a) | ||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||
(In thousands, except per share data) | ||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
October 1, 2017 | July 2, 2017 | October 2, 2016 | October 1, 2017 | October 2, 2016 | ||||||||||||||||
GAAP net income | $ | 18,680 | $ | 16,714 | $ | 24,591 | $ | 35,394 | $ | 45,538 | ||||||||||
GAAP diluted net income per share | $ | 0.14 | $ | 0.12 | $ | 0.18 | $ | 0.26 | $ | 0.33 | ||||||||||
Acquisition-related: | ||||||||||||||||||||
Amortization of acquisition-related intangibles | 8,963 | 8,876 | 5,246 | 17,839 | 11,021 | |||||||||||||||
Acquisition-related costs | — | 2,225 | 72 | 2,225 | 72 | |||||||||||||||
Amortization of fair market value adjustment to inventory | 2,011 | 4,081 | 520 | 6,092 | 2,915 | |||||||||||||||
Restructuring-related: | ||||||||||||||||||||
Severance costs | 1,637 | 653 | 5,002 | 2,290 | 16,920 | |||||||||||||||
Facility closure costs | 2,542 | — | — | 2,542 | 19 | |||||||||||||||
Assets impairment and other | 917 | 1,965 | — | 2,882 | 870 | |||||||||||||||
Other: | ||||||||||||||||||||
Stock-based compensation expense | 12,950 | 11,820 | 9,181 | 24,770 | 19,696 | |||||||||||||||
Non-cash interest expense | 3,695 | 3,892 | 3,309 | 7,587 | 6,577 | |||||||||||||||
Asset impairment and other | — | — | (652 | ) | — | (652 | ) | |||||||||||||
Certain unrealized foreign exchange gain | (754 | ) | (1,675 | ) | — | (2,429 | ) | — | ||||||||||||
Compensation expense - deferred compensation plan | 469 | 412 | 435 | 881 | 837 | |||||||||||||||
Gain on deferred compensation plan securities | (443 | ) | (360 | ) | (417 | ) | (803 | ) | (809 | ) | ||||||||||
Non-GAAP tax adjustments | (2,518 | ) | (3,341 | ) | 147 | (5,859 | ) | (4,393 | ) | |||||||||||
Non-GAAP net income | $ | 48,149 | $ | 45,262 | $ | 47,434 | $ | 93,411 | $ | 98,611 | ||||||||||
GAAP weighted average shares - diluted | 136,059 | 136,642 | 137,206 | 136,434 | 137,698 | |||||||||||||||
Non-GAAP adjustment | 2,780 | 2,319 | 2,581 | 2,465 | 2,313 | |||||||||||||||
Non-GAAP weighted average shares - diluted | 138,839 | 138,961 | 139,787 | 138,899 | 140,011 | |||||||||||||||
Non-GAAP diluted net income per share | $ | 0.35 | $ | 0.33 | $ | 0.34 | $ | 0.67 | $ | 0.70 | ||||||||||
GAAP gross profit | $ | 116,762 | $ | 110,038 | $ | 106,532 | $ | 226,800 | $ | 214,881 | ||||||||||
Acquisition-related: | ||||||||||||||||||||
Amortization of acquisition-related intangibles | 5,822 | 5,682 | 3,108 | 11,504 | 6,523 | |||||||||||||||
Amortization of fair market value adjustment to inventory | 2,011 | 4,081 | 520 | 6,092 | 2,915 | |||||||||||||||
Restructuring-related: | ||||||||||||||||||||
Severance costs | 30 | 196 | 257 | 226 | 2,687 | |||||||||||||||
Assets impairment and other | — | — | — | — | 336 | |||||||||||||||
Other: | ||||||||||||||||||||
Compensation expense - deferred compensation plan | 110 | 97 | 159 | 207 | 307 | |||||||||||||||
Stock-based compensation expense | 764 | 632 | 802 | 1,396 | 1,581 | |||||||||||||||
Non-GAAP gross profit | $ | 125,499 | $ | 120,726 | $ | 111,378 | $ | 246,225 | $ | 229,230 | ||||||||||
GAAP R&D expenses: | $ | 48,742 | $ | 48,449 | $ | 41,750 | $ | 97,191 | $ | 91,398 | ||||||||||
Restructuring-related: | ||||||||||||||||||||
Severance costs | (318 | ) | (45 | ) | (3,074 | ) | (363 | ) | (10,408 | ) | ||||||||||
Assets impairment and other | (835 | ) | (1,965 | ) | — | (2,800 | ) | (107 | ) |
Other: | ||||||||||||||||||||
Compensation expense - deferred compensation plan | (239 | ) | (210 | ) | (170 | ) | (449 | ) | (327 | ) | ||||||||||
Stock-based compensation expense | (6,094 | ) | (5,963 | ) | (3,191 | ) | (12,057 | ) | (7,499 | ) | ||||||||||
Non-GAAP R&D expenses | $ | 41,256 | $ | 40,266 | $ | 35,315 | $ | 81,522 | $ | 73,057 | ||||||||||
GAAP SG&A expenses: | $ | 44,485 | $ | 41,942 | $ | 37,415 | $ | 86,427 | $ | 76,231 | ||||||||||
Acquisition-related: | ||||||||||||||||||||
Amortization of acquisition-related intangibles | (3,141 | ) | (3,194 | ) | (2,138 | ) | (6,335 | ) | (4,498 | ) | ||||||||||
Acquisition-related costs | — | (2,225 | ) | (72 | ) | (2,225 | ) | (72 | ) | |||||||||||
Restructuring-related: | ||||||||||||||||||||
Severance costs | (1,289 | ) | (412 | ) | (1,671 | ) | (1,701 | ) | (3,825 | ) | ||||||||||
Facility closure costs | (2,542 | ) | — | — | (2,542 | ) | (18 | ) | ||||||||||||
Assets impairment and other | (82 | ) | — | — | (82 | ) | (428 | ) | ||||||||||||
Other: | ||||||||||||||||||||
Compensation expense - deferred compensation plan | (120 | ) | (105 | ) | (106 | ) | (225 | ) | (203 | ) | ||||||||||
Stock-based compensation expense | (6,092 | ) | (5,225 | ) | (5,188 | ) | (11,317 | ) | (10,616 | ) | ||||||||||
Non-GAAP SG&A expenses | $ | 31,219 | $ | 30,781 | $ | 28,240 | $ | 62,000 | $ | 56,571 | ||||||||||
GAAP interest and other expense, net | $ | (4,886 | ) | $ | (3,915 | ) | $ | (2,597 | ) | $ | (8,801 | ) | $ | (5,093 | ) | |||||
Non-cash interest expense | 3,695 | 3,892 | 3,309 | 7,587 | 6,577 | |||||||||||||||
Gain on deferred compensation plan securities | (443 | ) | (360 | ) | (417 | ) | (803 | ) | (809 | ) | ||||||||||
Certain unrealized foreign exchange gain | (754 | ) | (1,675 | ) | (652 | ) | (2,429 | ) | (652 | ) | ||||||||||
Non-GAAP interest and other income (expense), net | $ | (2,388 | ) | $ | (2,058 | ) | $ | (357 | ) | $ | (4,446 | ) | $ | 23 | ||||||
GAAP benefit from (provision for) income taxes | $ | 31 | $ | 982 | $ | (179 | ) | $ | 1,013 | $ | 3,379 | |||||||||
Non-GAAP tax adjustments | 2,518 | 3,341 | (147 | ) | 5,859 | 4,393 | ||||||||||||||
Non-GAAP provision for income taxes | $ | (2,487 | ) | $ | (2,359 | ) | $ | (32 | ) | $ | (4,846 | ) | $ | (1,014 | ) | |||||
(a) Refer to the accompanying “Notes to Non-GAAP Financial Measures” for a detailed discussion of Management’s use of non-GAAP financial measures. |
INTEGRATED DEVICE TECHNOLOGY, INC. | |||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||||
(Unaudited) | |||||||||
October 1 | April 2 | ||||||||
(In thousands) | 2017 | 2017 | |||||||
ASSETS | |||||||||
Current assets: | |||||||||
Cash and cash equivalents | $ | 147,897 | $ | 214,554 | |||||
Short-term investments | 222,623 | 191,492 | |||||||
Accounts receivable, net | 105,688 | 89,312 | |||||||
Inventories | 63,692 | 52,288 | |||||||
Prepayments and other current assets | 14,386 | 13,054 | |||||||
Total current assets | 554,286 | 560,700 | |||||||
Property, plant and equipment, net | 84,166 | 80,961 | |||||||
Goodwill | 420,117 | 306,925 | |||||||
Intangible assets, net | 207,355 | 108,818 | |||||||
Deferred tax assets | 87,696 | 85,831 | |||||||
Other assets | 62,408 | 40,399 | |||||||
TOTAL ASSETS | $ | 1,416,028 | $ | 1,183,634 | |||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||
Current liabilities: | |||||||||
Accounts payable | $ | 38,768 | $ | 42,020 | |||||
Accrued compensation and related expenses | 30,630 | 26,624 | |||||||
Deferred income on shipments to distributors | 2,823 | 1,985 | |||||||
Current portion of bank loan | 2,000 | — | |||||||
Other accrued liabilities | 28,077 | 20,205 | |||||||
Total current liabilities | 102,298 | 90,834 | |||||||
Deferred tax liabilities | 11,406 | 13,835 | |||||||
Convertible notes | 292,458 | 285,541 | |||||||
Long-term bank loan, net | 191,662 | — | |||||||
Other long-term liabilities | 31,147 | 19,761 | |||||||
Total liabilities | 628,971 | 409,971 | |||||||
Stockholders' equity | 787,057 | 773,663 | |||||||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 1,416,028 | $ | 1,183,634 |