FORM 8-K |
Delaware (State or Other Jurisdiction of Incorporation or Organization) | 94-2896096 (I.R.S. Employer I. D. No.) |
Title of each class Common stock, $0.001 par value | Trading Symbol MXIM | Name of each exchange on which registered The NASDAQ Global Select Market |
Maxim Integrated Products, Inc. | |
By:/s/ Bruce E. Kiddoo | |
Bruce E. Kiddoo Senior Vice President, Chief Financial Officer and Chief Accounting Officer |
• | Revenue: $557 million |
• | Gross Margin: 64.0% GAAP (64.8% excluding special items) |
• | EPS: $1.33 GAAP ($0.57 excluding special items) |
• | Fiscal first quarter revenue outlook: $510 to $550 million |
• | Quarterly dividend increased 4% to $0.48 per share |
• | Cash flow from operations: $237 million |
• | Capital expenditures: $31 million |
• | Dividends paid: $125 million ($0.46 per share) |
• | Stock repurchases: $102 million |
• | Revenue: $510 to $550 million |
• | Gross Margin: 62% to 64% GAAP (63% to 65% excluding special items) |
• | EPS: $0.45 to $0.51 GAAP ($0.46 to $0.52 excluding special items) |
CONSOLIDATED STATEMENTS OF INCOME | |||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||||||||
June 29, 2019 | March 30, 2019 | June 30, 2018 | June 29, 2019 | June 30, 2018 | |||||||||||||||||
(in thousands, except per share data) | |||||||||||||||||||||
Net revenues | $ | 556,545 | $ | 542,383 | $ | 633,154 | $ | 2,314,329 | $ | 2,480,066 | |||||||||||
Cost of goods sold | 200,154 | 201,552 | 214,486 | 813,823 | 853,945 | ||||||||||||||||
Gross margin | 356,391 | 340,831 | 418,668 | 1,500,506 | 1,626,121 | ||||||||||||||||
Operating expenses: | |||||||||||||||||||||
Research and development | 105,136 | 107,075 | 112,056 | 435,222 | 450,943 | ||||||||||||||||
Selling, general and administrative | 75,130 | 74,116 | 82,611 | 308,617 | 322,918 | ||||||||||||||||
Intangible asset amortization | 756 | 756 | 844 | 3,041 | 4,467 | ||||||||||||||||
Impairment of long-lived assets | — | — | — | 753 | 892 | ||||||||||||||||
Severance and restructuring expenses | 1,715 | 1,744 | 833 | 5,632 | 15,060 | ||||||||||||||||
Other operating expenses (income), net | 83 | — | (71 | ) | 143 | (1,607 | ) | ||||||||||||||
Total operating expenses | 182,820 | 183,691 | 196,273 | 753,408 | 792,673 | ||||||||||||||||
Operating income | 173,571 | 157,140 | 222,395 | 747,098 | 833,448 | ||||||||||||||||
Interest and other income (expense), net | 4,079 | 3,318 | 1,305 | 7,323 | (8,563 | ) | |||||||||||||||
Income before taxes | 177,650 | 160,458 | 223,700 | 754,421 | 824,885 | ||||||||||||||||
Provision for (benefit from) income taxes (1)(2) | (189,908 | ) | 29,845 | 29,528 | (73,065 | ) | 357,567 | ||||||||||||||
Net income | $ | 367,558 | $ | 130,613 | $ | 194,172 | $ | 827,486 | $ | 467,318 | |||||||||||
Earnings per share: | |||||||||||||||||||||
Basic | $ | 1.35 | $ | 0.48 | $ | 0.70 | $ | 3.01 | $ | 1.66 | |||||||||||
Diluted | $ | 1.33 | $ | 0.47 | $ | 0.68 | $ | 2.97 | $ | 1.64 | |||||||||||
Shares used in the calculation of earnings per share: | |||||||||||||||||||||
Basic | 272,382 | 273,221 | 279,304 | 274,966 | 280,979 | ||||||||||||||||
Diluted | 275,834 | 276,610 | 283,934 | 278,777 | 285,674 | ||||||||||||||||
Dividends paid per share | $ | 0.46 | $ | 0.46 | $ | 0.42 | $ | 1.84 | $ | 1.56 | |||||||||||
SCHEDULE OF SPECIAL ITEMS | |||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||||||||
June 29, 2019 | March 30, 2019 | June 30, 2018 | June 29, 2019 | June 30, 2018 | |||||||||||||||||
(in thousands) | |||||||||||||||||||||
Cost of goods sold: | |||||||||||||||||||||
Intangible asset amortization | $ | 4,038 | $ | 5,008 | $ | 11,759 | $ | 22,829 | $ | 46,064 | |||||||||||
Total | $ | 4,038 | $ | 5,008 | $ | 11,759 | $ | 22,829 | $ | 46,064 | |||||||||||
Operating expenses: | |||||||||||||||||||||
Intangible asset amortization | $ | 756 | $ | 756 | $ | 844 | $ | 3,041 | $ | 4,467 | |||||||||||
Impairment of long-lived assets | — | — | — | 753 | 892 | ||||||||||||||||
Severance and restructuring | 1,715 | 1,744 | 833 | 5,632 | 15,060 | ||||||||||||||||
Other operating expenses (income), net | 83 | — | (71 | ) | 143 | (1,607 | ) | ||||||||||||||
Total | $ | 2,554 | $ | 2,500 | $ | 1,606 | $ | 9,569 | $ | 18,812 | |||||||||||
Interest and other expense (income), net | $ | (2,980 | ) | $ | (857 | ) | $ | (941 | ) | $ | (4,565 | ) | $ | (1,243 | ) | ||||||
Total | $ | (2,980 | ) | $ | (857 | ) | $ | (941 | ) | $ | (4,565 | ) | $ | (1,243 | ) | ||||||
Provision for (benefit from) for income taxes: | |||||||||||||||||||||
Impact of U.S. tax legislation (1) | $ | 47,703 | $ | (1,056 | ) | $ | — | $ | 68,729 | $ | 243,550 | ||||||||||
Impact of income tax audit settlements (2) | (251,599 | ) | — | — | (251,599 | ) | — | ||||||||||||||
Total | $ | (203,896 | ) | $ | (1,056 | ) | $ | — | $ | (182,870 | ) | $ | 243,550 | ||||||||
(1) Includes effect of U.S. tax legislation enacted on December 22, 2017. | |||||||||||||||||||||
(2) Includes effect of income tax audit settlements. | |||||||||||||||||||||
CONSOLIDATED BALANCE SHEETS | |||||||||||||
(Unaudited) | |||||||||||||
June 29, 2019 | March 30, 2019 | June 30, 2018 | |||||||||||
(in thousands) | |||||||||||||
ASSETS | |||||||||||||
Current assets: | |||||||||||||
Cash and cash equivalents | $ | 1,757,342 | $ | 1,654,563 | $ | 1,543,484 | |||||||
Short-term investments | 140,990 | 243,864 | 1,082,915 | ||||||||||
Total cash, cash equivalents and short-term investments | 1,898,332 | 1,898,427 | 2,626,399 | ||||||||||
Accounts receivable, net | 360,016 | 381,152 | 280,072 | ||||||||||
Inventories | 246,512 | 272,832 | 282,390 | ||||||||||
Other current assets | 34,640 | 24,358 | 21,548 | ||||||||||
Total current assets | 2,539,500 | 2,576,769 | 3,210,409 | ||||||||||
Property, plant and equipment, net | 577,722 | 571,955 | 579,364 | ||||||||||
Intangible assets, net | 56,242 | 61,036 | 78,246 | ||||||||||
Goodwill | 532,251 | 532,251 | 532,251 | ||||||||||
Other assets | 38,267 | 61,843 | 51,291 | ||||||||||
TOTAL ASSETS | $ | 3,743,982 | $ | 3,803,854 | $ | 4,451,561 | |||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||||
Current liabilities: | |||||||||||||
Accounts payable | $ | 84,335 | $ | 86,798 | $ | 92,572 | |||||||
Price adjustment and other revenue reserves | 100,490 | 106,011 | — | ||||||||||
Income taxes payable | 33,765 | 44,179 | 17,961 | ||||||||||
Accrued salary and related expenses | 118,704 | 128,365 | 151,682 | ||||||||||
Accrued expenses | 33,873 | 33,644 | 35,774 | ||||||||||
Current portion of long-term debt | — | — | 499,406 | ||||||||||
Total current liabilities | 371,167 | 398,997 | 797,395 | ||||||||||
Long-term debt | 992,584 | 992,225 | 991,147 | ||||||||||
Income taxes payable | 469,418 | 688,780 | 661,336 | ||||||||||
Other liabilities | 65,537 | 61,105 | 70,743 | ||||||||||
Total liabilities | 1,898,706 | 2,141,107 | 2,520,621 | ||||||||||
Stockholders' equity: | |||||||||||||
Common stock and capital in excess of par value | 272 | 279 | 279 | ||||||||||
Retained earnings | 1,856,358 | 1,672,938 | 1,945,646 | ||||||||||
Accumulated other comprehensive loss | (11,354 | ) | (10,470 | ) | (14,985 | ) | |||||||
Total stockholders' equity | 1,845,276 | 1,662,747 | 1,930,940 | ||||||||||
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY | $ | 3,743,982 | $ | 3,803,854 | $ | 4,451,561 | |||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||
Three months ended | Year Ended | ||||||||||||||||||||
June 29, 2019 | March 30, 2019 | June 30, 2018 | June 29, 2019 | June 30, 2018 | |||||||||||||||||
Cash flows from operating activities: | |||||||||||||||||||||
Net income | $ | 367,558 | $ | 130,613 | $ | 194,172 | $ | 827,486 | $ | 467,318 | |||||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||||||||||||
Stock-based compensation | 22,004 | 22,820 | 19,753 | 86,977 | 78,685 | ||||||||||||||||
Depreciation and amortization | 25,569 | 27,182 | 36,083 | 110,745 | 144,974 | ||||||||||||||||
Deferred taxes | 26,118 | (3,955 | ) | 21,458 | 13,957 | 27,715 | |||||||||||||||
Loss from sale of property, plant and equipment | 643 | 428 | 423 | 3,967 | 995 | ||||||||||||||||
Impairment of long-lived assets | — | — | — | — | 42 | ||||||||||||||||
Impairment of investment in privately-held companies | (268 | ) | (371 | ) | — | (3 | ) | 850 | |||||||||||||
Changes in assets and liabilities: | |||||||||||||||||||||
Accounts receivable | 15,615 | (14,323 | ) | 40,480 | 21,090 | (19,714 | ) | ||||||||||||||
Inventories | 26,383 | 6,123 | (9,450 | ) | 36,003 | (32,776 | ) | ||||||||||||||
Other current assets | (11,875 | ) | 3,561 | (212 | ) | (14,901 | ) | 32,368 | |||||||||||||
Accounts payable | 699 | (13,372 | ) | 6,131 | (10,272 | ) | 9,560 | ||||||||||||||
Income taxes payable | (229,776 | ) | 20,401 | (163,010 | ) | (176,114 | ) | 117,654 | |||||||||||||
Deferred margin on shipments to distributors | — | — | — | — | (14,974 | ) | |||||||||||||||
All other accrued liabilities | (5,203 | ) | 27,831 | 831 | (23,095 | ) | 6,767 | ||||||||||||||
Net cash provided by operating activities | 237,467 | 206,938 | 146,659 | 875,840 | 819,464 | ||||||||||||||||
Cash flows from investing activities: | |||||||||||||||||||||
Purchases of property, plant and equipment | (30,653 | ) | (21,257 | ) | (12,118 | ) | (82,823 | ) | (65,782 | ) | |||||||||||
Proceeds from sales of property, plant and equipment | 306 | 32 | 62 | 340 | 5,823 | ||||||||||||||||
Proceeds from sales of available-for-sale securities | — | 2,939 | 7,287 | 30,192 | 107,291 | ||||||||||||||||
Proceeds from maturity of available-for-sale securities | 103,431 | 308,529 | 330,749 | 1,130,514 | 753,249 | ||||||||||||||||
Payment in connection with business acquisition, net of cash acquired | — | — | — | (2,949 | ) | (57,773 | ) | ||||||||||||||
Purchases of available-for-sale securities | — | — | (325,063 | ) | (214,587 | ) | (1,447,354 | ) | |||||||||||||
Purchases of privately-held companies' securities | (1,500 | ) | (770 | ) | (2,164 | ) | (3,176 | ) | (5,520 | ) | |||||||||||
Other investing activities | (60 | ) | (540 | ) | — | (600 | ) | — | |||||||||||||
Net cash provided by (used in) investing activities | 71,524 | 288,933 | (1,247 | ) | 856,911 | (710,066 | ) | ||||||||||||||
Cash flows from financing activities: | |||||||||||||||||||||
Contingent consideration paid | — | (1,052 | ) | — | (9,052 | ) | — | ||||||||||||||
Net issuance of restricted stock units | (6,663 | ) | (9,582 | ) | (9,148 | ) | (29,689 | ) | (30,310 | ) | |||||||||||
Repayment of notes payable | — | — | — | (500,000 | ) | — | |||||||||||||||
Proceeds from stock options exercised | 5,414 | 5,143 | 1,626 | 24,400 | 28,009 | ||||||||||||||||
Issuance of common stock under employee stock purchase program | 22,486 | — | 21,346 | 40,175 | 36,321 | ||||||||||||||||
Repurchase of common stock | (102,104 | ) | (116,991 | ) | (128,024 | ) | (539,151 | ) | (407,968 | ) | |||||||||||
Dividends paid | (125,345 | ) | (125,566 | ) | (117,321 | ) | (505,576 | ) | (438,087 | ) | |||||||||||
Net cash used in financing activities | (206,212 | ) | (248,048 | ) | (231,521 | ) | (1,518,893 | ) | (812,035 | ) | |||||||||||
Net increase (decrease) in cash and cash equivalents | 102,779 | 247,823 | (86,109 | ) | 213,858 | (702,637 | ) | ||||||||||||||
Cash and cash equivalents: | |||||||||||||||||||||
Beginning of period | $ | 1,654,563 | $ | 1,406,740 | $ | 1,629,593 | $ | 1,543,484 | $ | 2,246,121 | |||||||||||
End of period | $ | 1,757,342 | $ | 1,654,563 | $ | 1,543,484 | $ | 1,757,342 | $ | 1,543,484 | |||||||||||
Total cash, cash equivalents, and short-term investments | $ | 1,898,332 | $ | 1,898,427 | $ | 2,626,399 | $ | 1,898,332 | $ | 2,626,399 | |||||||||||
ANALYSIS OF GAAP VERSUS GAAP EXCLUDING SPECIAL ITEMS DISCLOSURES | ||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||
Three Months Ended | Year Ended | |||||||||||||||||||||
June 29, 2019 | March 30, 2019 | June 30, 2018 | June 29, 2019 | June 30, 2018 | ||||||||||||||||||
(in thousands, except per share data) | ||||||||||||||||||||||
Reconciliation of GAAP gross profit to GAAP gross profit excluding special items: | ||||||||||||||||||||||
GAAP gross profit | $ | 356,391 | $ | 340,831 | $ | 418,668 | $ | 1,500,506 | $ | 1,626,121 | ||||||||||||
GAAP gross profit % | 64.0 | % | 62.8 | % | 66.1 | % | 64.8 | % | 65.6 | % | ||||||||||||
Special items: | ||||||||||||||||||||||
Intangible asset amortization | 4,038 | 5,008 | 11,759 | 22,829 | 46,064 | |||||||||||||||||
Total special items | 4,038 | 5,008 | 11,759 | 22,829 | 46,064 | |||||||||||||||||
GAAP gross profit excluding special items | $ | 360,429 | $ | 345,839 | $ | 430,427 | $ | 1,523,335 | $ | 1,672,185 | ||||||||||||
GAAP gross profit % excluding special items | 64.8 | % | 63.8 | % | 68.0 | % | 65.8 | % | 67.4 | % | ||||||||||||
Reconciliation of GAAP operating expenses to GAAP operating expenses excluding special items: | ||||||||||||||||||||||
GAAP operating expenses | $ | 182,820 | $ | 183,691 | $ | 196,273 | $ | 753,408 | $ | 792,674 | ||||||||||||
Special items: | ||||||||||||||||||||||
Intangible asset amortization | 756 | 756 | 844 | 3,041 | 4,467 | |||||||||||||||||
Impairment of long-lived assets | — | — | — | 753 | 892 | |||||||||||||||||
Severance and restructuring | 1,715 | 1,744 | 833 | 5,632 | 15,060 | |||||||||||||||||
Other operating expenses (income), net | 83 | — | (71 | ) | 143 | (1,607 | ) | |||||||||||||||
Total special items | 2,554 | 2,500 | 1,605 | 9,569 | 18,812 | |||||||||||||||||
GAAP operating expenses excluding special items | $ | 180,266 | $ | 181,191 | $ | 194,667 | $ | 743,839 | $ | 773,862 | ||||||||||||
Reconciliation of GAAP net income to GAAP net income excluding special items: | ||||||||||||||||||||||
GAAP net income | $ | 367,558 | $ | 130,613 | $ | 194,172 | $ | 827,486 | $ | 467,318 | ||||||||||||
Special items: | ||||||||||||||||||||||
Intangible asset amortization | 4,794 | 5,764 | 12,603 | 25,870 | 50,531 | |||||||||||||||||
Impairment of long-lived assets | — | — | — | 753 | 892 | |||||||||||||||||
Severance and restructuring | 1,715 | 1,744 | 833 | 5,632 | 15,060 | |||||||||||||||||
Other operating expenses (income), net | 83 | — | (71 | ) | 143 | (1,607 | ) | |||||||||||||||
Interest and other expense (income), net | (2,980 | ) | (857 | ) | (941 | ) | (4,565 | ) | (1,243 | ) | ||||||||||||
Pre-tax total special items | 3,612 | 6,651 | 12,424 | 27,833 | 63,633 | |||||||||||||||||
Other income tax effects and adjustments (1) | (11,271 | ) | 7,506 | 1,194 | 4,747 | (898 | ) | |||||||||||||||
Impact of U.S. tax legislation (2) | 47,703 | (1,056 | ) | — | 68,729 | 243,550 | ||||||||||||||||
Impact of income tax audit settlements (3) | (251,599 | ) | — | — | (251,599 | ) | — | |||||||||||||||
GAAP net income excluding special items | $ | 156,003 | $ | 143,714 | $ | 207,790 | $ | 677,196 | $ | 773,603 | ||||||||||||
GAAP net income per share excluding special items: | ||||||||||||||||||||||
Basic | $ | 0.57 | $ | 0.53 | $ | 0.74 | $ | 2.46 | $ | 2.75 | ||||||||||||
Diluted | $ | 0.57 | $ | 0.52 | $ | 0.73 | $ | 2.43 | $ | 2.71 | ||||||||||||
Shares used in the calculation of earnings per share excluding special items: | ||||||||||||||||||||||
Basic | 272,382 | 273,221 | 279,304 | 274,966 | 280,979 | |||||||||||||||||
Diluted | 275,834 | 276,610 | 283,934 | 278,777 | 285,674 | |||||||||||||||||
(1) Includes tax effect of pre-tax special items and miscellaneous tax adjustments. | ||||||||||||||||||||||
(2) Includes effect of U.S. tax legislation enacted on December 22, 2017. | ||||||||||||||||||||||
(3) Includes effect of income tax audit settlements. | ||||||||||||||||||||||
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