FORM 8-K |
Delaware (State or Other Jurisdiction of Incorporation or Organization) | 94-2896096 (I.R.S. Employer I. D. No.) |
Maxim Integrated Products, Inc. | |
By:/s/ Sumeet Gagneja | |
Sumeet Gagneja Vice President, Chief Accounting Officer (Chief Accounting Officer and Duly Authorized Officer) |
• | Revenue: $623 million |
• | Gross Margin: 65.8%% GAAP (67.6% excluding special items) |
• | EPS: $0.27 GAAP loss ($0.65 gain, excluding special items) |
• | Fiscal third quarter revenue outlook $620 to $660 million |
• | Quarterly dividend increased 17% to $0.42 per share |
• | Cash flow from operations: $230 million |
• | Capital expenditures: $22 million |
• | Dividends paid: $101 million ($0.36 per share) |
• | Stock repurchases: $77 million |
• | Revenue: $620 to $660 million |
• | Gross Margin: 64% to 66% GAAP (66% to 68% excluding special items) |
• | EPS: $0.63 to $0.69 GAAP ($0.66 to $0.72 excluding special items) |
CONSOLIDATED BALANCE SHEETS | |||||||||||||
(Unaudited) | |||||||||||||
December 30, 2017 | September 23, 2017 | December 24, 2016 | |||||||||||
(in thousands) | |||||||||||||
ASSETS | |||||||||||||
Current assets: | |||||||||||||
Cash and cash equivalents | $ | 1,631,510 | $ | 1,577,160 | $ | 1,687,435 | |||||||
Short-term investments | 1,191,765 | 1,196,827 | 399,461 | ||||||||||
Total cash, cash equivalents and short-term investments | 2,823,275 | 2,773,987 | 2,086,896 | ||||||||||
Accounts receivable, net | 235,695 | 233,215 | 224,342 | ||||||||||
Inventories | 259,597 | 245,347 | 236,040 | ||||||||||
Other current assets | 24,153 | 55,033 | 75,284 | ||||||||||
Total current assets | 3,342,720 | 3,307,582 | 2,622,562 | ||||||||||
Property, plant and equipment, net | 597,818 | 595,622 | 660,660 | ||||||||||
Intangible assets, net | 67,716 | 79,850 | 117,393 | ||||||||||
Goodwill | 491,015 | 491,015 | 491,015 | ||||||||||
Other assets | 65,243 | 61,937 | 56,344 | ||||||||||
TOTAL ASSETS | $ | 4,564,512 | $ | 4,536,006 | $ | 3,947,974 | |||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||||
Current liabilities: | |||||||||||||
Accounts payable | $ | 84,770 | $ | 66,915 | $ | 70,505 | |||||||
Income taxes payable | 10,523 | 3,688 | 3,138 | ||||||||||
Accrued salary and related expenses | 113,716 | 103,194 | 109,475 | ||||||||||
Accrued expenses | 37,687 | 43,121 | 41,418 | ||||||||||
Deferred revenue on shipments to distributors | — | 16,994 | 36,137 | ||||||||||
Current portion of debt | 498,694 | — | — | ||||||||||
Total current liabilities | 745,390 | 233,912 | 260,673 | ||||||||||
Long-term debt | 990,428 | 1,488,406 | 991,281 | ||||||||||
Income taxes payable | 801,260 | 573,831 | 514,498 | ||||||||||
Other liabilities | 41,736 | 42,113 | 37,331 | ||||||||||
Total liabilities | 2,578,814 | 2,338,262 | 1,803,783 | ||||||||||
Stockholders' equity: | |||||||||||||
Common stock and capital in excess of par value | 283 | 283 | 284 | ||||||||||
Retained earnings | 1,997,207 | 2,207,052 | 2,155,698 | ||||||||||
Accumulated other comprehensive loss | (11,792 | ) | (9,591 | ) | (11,791 | ) | |||||||
Total stockholders' equity | 1,985,698 | 2,197,744 | 2,144,191 | ||||||||||
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY | $ | 4,564,512 | $ | 4,536,006 | $ | 3,947,974 | |||||||
CONSOLIDATED STATEMENTS OF INCOME | |||||||||||||
(Unaudited) | |||||||||||||
Three Months Ended | |||||||||||||
December 30, 2017 | September 23, 2017 | December 24, 2016 | |||||||||||
(in thousands, except per share data) | |||||||||||||
Net revenues | $ | 622,637 | $ | 575,676 | $ | 550,998 | |||||||
Cost of goods sold (1) | 212,961 | 201,845 | 210,820 | ||||||||||
Gross margin | 409,676 | 373,831 | 340,178 | ||||||||||
Operating expenses: | |||||||||||||
Research and development | 115,896 | 108,601 | 114,057 | ||||||||||
Selling, general and administrative | 85,323 | 73,681 | 71,543 | ||||||||||
Intangible asset amortization | 995 | 1,752 | 2,348 | ||||||||||
Impairment of long-lived assets (2) | 850 | 42 | 383 | ||||||||||
Severance and restructuring expenses | 6,523 | 5,433 | 864 | ||||||||||
Other operating expenses (income), net | (959 | ) | (844 | ) | 1,909 | ||||||||
Total operating expenses (income), net | 208,628 | 188,665 | 191,104 | ||||||||||
Operating income (loss) | 201,048 | 185,166 | 149,074 | ||||||||||
Interest and other income (expense), net | (3,121 | ) | (4,214 | ) | (636 | ) | |||||||
Income (loss) before provision for income taxes | 197,927 | 180,952 | 148,438 | ||||||||||
Income tax provision (benefit) (3) | 272,942 | 26,419 | 17,961 | ||||||||||
Net income (loss) | $ | (75,015 | ) | $ | 154,533 | $ | 130,477 | ||||||
Earnings (loss) per share: | |||||||||||||
Basic | $ | (0.27 | ) | $ | 0.55 | $ | 0.46 | ||||||
Diluted | $ | (0.27 | ) | $ | 0.54 | $ | 0.45 | ||||||
Shares used in the calculation of earnings (loss) per share: | |||||||||||||
Basic | 281,560 | 282,170 | 283,294 | ||||||||||
Diluted | 281,560 | 286,437 | 288,106 | ||||||||||
Dividends paid per share | $ | 0.36 | $ | 0.36 | $ | 0.33 | |||||||
SCHEDULE OF SPECIAL ITEMS | |||||||||||||
(Unaudited) | |||||||||||||
Three Months Ended | |||||||||||||
December 30, 2017 | September 23, 2017 | December 24, 2016 | |||||||||||
(in thousands) | |||||||||||||
Cost of goods sold: | |||||||||||||
Intangible asset amortization | $ | 11,139 | $ | 11,064 | $ | 11,755 | |||||||
Accelerated depreciation (1) | — | — | 1,178 | ||||||||||
Total | $ | 11,139 | $ | 11,064 | $ | 12,933 | |||||||
Operating expenses: | |||||||||||||
Intangible asset amortization | $ | 995 | $ | 1,752 | $ | 2,348 | |||||||
Impairment of long-lived assets (2) | 850 | 42 | 383 | ||||||||||
Severance and restructuring | 6,523 | 5,433 | 864 | ||||||||||
Other operating expenses (income), net | (959 | ) | (844 | ) | 1,909 | ||||||||
Total | $ | 7,409 | $ | 6,383 | $ | 5,504 | |||||||
Interest and other expense (income), net | $ | (119 | ) | $ | (84 | ) | $ | (5,052 | ) | ||||
Total | $ | (119 | ) | $ | (84 | ) | $ | (5,052 | ) | ||||
Provision (benefit) for income taxes: | |||||||||||||
Impact of U.S. tax legislation (3) | $ | 243,550 | $ | — | $ | — | |||||||
Total | $ | 243,550 | $ | — | $ | — | |||||||
(1) Includes building and equipment accelerated depreciation related to the Dallas manufacturing facility during the second quarter of fiscal year 2017. | |||||||||||||
(2) Includes impairment of investments in privately-held companies and other equipment impairment charges. | |||||||||||||
(3) Includes effect of U.S. tax legislation enacted on December 22, 2017. | |||||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||
(Unaudited) | |||||||||||||
Three Months Ended | |||||||||||||
December 30, 2017 | September 23, 2017 | December 24, 2016 | |||||||||||
(in thousands) | |||||||||||||
Cash flows from operating activities: | |||||||||||||
Net income (loss) | $ | (75,015 | ) | $ | 154,533 | $ | 130,477 | ||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||||||||||||
Stock-based compensation | 21,040 | 17,287 | 18,073 | ||||||||||
Depreciation and amortization | 35,813 | 36,754 | 42,140 | ||||||||||
Deferred taxes | (3,188 | ) | 12,115 | (7,520 | ) | ||||||||
Loss (gain) from sale of property, plant and equipment | (649 | ) | 61 | 3,898 | |||||||||
Impairment of long-lived assets | — | 42 | 383 | ||||||||||
Impairment of of investment in privately-held companies | 850 | — | — | ||||||||||
Changes in assets and liabilities: | |||||||||||||
Accounts receivable | (2,480 | ) | 23,239 | 29,176 | |||||||||
Inventories | (14,125 | ) | 1,835 | (12,512 | ) | ||||||||
Other current assets | 31,459 | 1,488 | (7,583 | ) | |||||||||
Accounts payable | 13,643 | (9,979 | ) | (11,999 | ) | ||||||||
Income taxes payable | 234,264 | 16,333 | 17,138 | ||||||||||
Deferred revenue on shipments to distributors | (16,994 | ) | 2,020 | 383 | |||||||||
Accrued salary and related expenses | 10,523 | (42,105 | ) | (1,651 | ) | ||||||||
All other accrued liabilities | (5,266 | ) | 6,082 | (7,773 | ) | ||||||||
Net cash provided by (used in) operating activities | 229,875 | 219,705 | 192,630 | ||||||||||
Cash flows from investing activities: | |||||||||||||
Purchase of property, plant and equipment | (22,413 | ) | (14,321 | ) | (15,775 | ) | |||||||
Proceeds from sales of property, plant and equipment | 1,444 | 1,473 | 2,224 | ||||||||||
Proceeds from sale of available-for-sale securities | 21,895 | 18,101 | 26,454 | ||||||||||
Proceeds from maturity of available-for-sale securities | 118,211 | — | — | ||||||||||
Purchases of available-for-sale securities | (137,166 | ) | (716,304 | ) | (225,622 | ) | |||||||
Purchases of privately-held companies' securities | (1,500 | ) | (606 | ) | (326 | ) | |||||||
Net cash provided by (used in) investing activities | (19,529 | ) | (711,657 | ) | (213,045 | ) | |||||||
Cash flows from financing activities: | |||||||||||||
Repayment of notes payable | — | — | (250,000 | ) | |||||||||
Net issuance of restricted stock units | (6,104 | ) | (5,416 | ) | (4,239 | ) | |||||||
Proceeds from stock options exercised | 13,507 | 5,160 | 7,155 | ||||||||||
Issuance of common stock under employee stock purchase program | 14,975 | — | 17,658 | ||||||||||
Repurchase of common stock | (76,953 | ) | (75,291 | ) | (61,235 | ) | |||||||
Dividends paid | (101,421 | ) | (101,462 | ) | (93,562 | ) | |||||||
Net cash provided by (used in) financing activities | (155,996 | ) | (177,009 | ) | (384,223 | ) | |||||||
Net increase (decrease) in cash and cash equivalents | 54,350 | (668,961 | ) | (404,638 | ) | ||||||||
Cash and cash equivalents: | |||||||||||||
Beginning of period | $ | 1,577,160 | $ | 2,246,121 | $ | 2,092,073 | |||||||
End of period | $ | 1,631,510 | $ | 1,577,160 | $ | 1,687,435 | |||||||
Total cash, cash equivalents, and short-term investments | $ | 2,823,275 | $ | 2,773,987 | $ | 2,086,896 | |||||||
ANALYSIS OF GAAP VERSUS GAAP EXCLUDING SPECIAL ITEMS DISCLOSURES | ||||||||||||||
(Unaudited) | ||||||||||||||
Three Months Ended | ||||||||||||||
December 30, 2017 | September 23, 2017 | December 24, 2016 | ||||||||||||
(in thousands, except per share data) | ||||||||||||||
Reconciliation of GAAP gross profit to GAAP gross profit excluding special items: | ||||||||||||||
GAAP gross profit | $ | 409,676 | $ | 373,831 | $ | 340,178 | ||||||||
GAAP gross profit % | 65.8 | % | 64.9 | % | 61.7 | % | ||||||||
Special items: | ||||||||||||||
Intangible asset amortization | 11,139 | 11,064 | 11,755 | |||||||||||
Accelerated depreciation (1) | — | — | 1,178 | |||||||||||
Total special items | 11,139 | 11,064 | 12,933 | |||||||||||
GAAP gross profit excluding special items | $ | 420,815 | $ | 384,895 | $ | 353,111 | ||||||||
GAAP gross profit % excluding special items | 67.6 | % | 66.9 | % | 64.1 | % | ||||||||
Reconciliation of GAAP operating expenses to GAAP operating expenses excluding special items: | ||||||||||||||
GAAP operating expenses | $ | 208,628 | $ | 188,665 | $ | 191,104 | ||||||||
Special items: | ||||||||||||||
Intangible asset amortization | 995 | 1,752 | 2,348 | |||||||||||
Impairment of long-lived assets (2) | 850 | 42 | 383 | |||||||||||
Severance and restructuring | 6,523 | 5,433 | 864 | |||||||||||
Other operating expenses (income), net | (959 | ) | (844 | ) | 1,909 | |||||||||
Total special items | 7,409 | 6,383 | 5,504 | |||||||||||
GAAP operating expenses excluding special items | $ | 201,219 | $ | 182,282 | $ | 185,600 | ||||||||
Reconciliation of GAAP net income (loss) to GAAP net income excluding special items: | ||||||||||||||
GAAP net income (loss) | $ | (75,015 | ) | $ | 154,533 | $ | 130,477 | |||||||
Special items: | ||||||||||||||
Intangible asset amortization | 12,134 | 12,816 | 14,103 | |||||||||||
Accelerated depreciation (1) | — | — | 1,178 | |||||||||||
Impairment of long-lived assets (2) | 850 | 42 | 383 | |||||||||||
Severance and restructuring | 6,523 | 5,433 | 864 | |||||||||||
Other operating expenses (income), net | (959 | ) | (844 | ) | 1,909 | |||||||||
Interest and other expense (income), net | (119 | ) | (84 | ) | (5,052 | ) | ||||||||
Pre-tax total special items | 18,429 | 17,363 | 13,385 | |||||||||||
Other income tax effects and adjustments (3) | (897 | ) | (1,345 | ) | (11,167 | ) | ||||||||
Impact of U.S. tax legislation (4) | 243,550 | — | — | |||||||||||
GAAP net income excluding special items | $ | 186,067 | $ | 170,551 | $ | 132,695 | ||||||||
GAAP net income per share excluding special items: | ||||||||||||||
Basic | $ | 0.66 | $ | 0.60 | $ | 0.47 | ||||||||
Diluted | $ | 0.65 | $ | 0.60 | $ | 0.46 | ||||||||
Shares used in the calculation of earnings per share excluding special items: | ||||||||||||||
Basic | 281,560 | 282,170 | 283,294 | |||||||||||
Diluted (5) | 286,356 | 286,437 | 288,106 | |||||||||||
(1) Includes building and equipment accelerated depreciation related to the Dallas manufacturing facility during the second quarter of fiscal year 2017. | ||||||||||||||
(2) Includes impairment of investments in privately-held companies and other equipment impairment charges. | ||||||||||||||
(3) Includes tax effect of pre-tax special items and miscellaneous tax adjustments. | ||||||||||||||
(4) Includes effect of U.S. tax legislation enacted on December 22, 2017. | ||||||||||||||
(5) Shares used in diluted earnings per share excluding special items differs from GAAP loss per share due to net income on a non-GAAP basis. |
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