8-K

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:  May 3, 2005
(Date of Earliest Event Reported)

MAXIM INTEGRATED PRODUCTS, INC.

(Exact Name of Registrant as Specified in Its Charter)

DELAWARE	0-16538	94-2896096
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)
120 SAN GABRIEL DRIVE SUNNYVALE, CALIFORNIA		94086
(Address of Principal Executive Offices)		(Zip Code)

(408) 737-7600
(Registrant’s Telephone Number, Including Area Code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02          Results of Operations and Financial Condition.

          On May 3, 2005, Maxim Integrated Products, Inc. (the “Company”) announced via press release the Company’s preliminary results for its third quarter of fiscal year 2005 ended March 26, 2005.  A copy of the Company’s press release is attached hereto as Exhibit 99.1.

          The information in this Current Report and attached Exhibit 99.1 are furnished to, but not filed with, the Securities and Exchange Commission for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section, and such information shall not be deemed to be incorporated by reference into any of the Company’s filings with the Securities and Exchange Commission, except as shall be expressly set forth by specific reference in any such filing.

Item 9.01          Financial Statements and Exhibits.

(c)                   Exhibits.

The exhibit listed below is being furnished with this Form 8-K.

Exhibit No.	Description
99.1	Press release dated May 3, 2005 announcing the Company’s financial results for the third quarter of its fiscal year 2005.

SIGNATURES

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

MAXIM INTEGRATED PRODUCTS, INC.
By:	/s/ CARL W. JASPER
	Carl W. Jasper
	Vice President and Chief Financial Officer

Date:  May 3, 2005

EX-99.1

Exhibit 99.1

Press Information

FOR IMMEDIATE RELEASE

NASDAQ SYMBOL MXIM

Contact:	John F. Gifford, Chairman,
	President and Chief Executive Officer
	(408) 737-7600

MAXIM REPORTS 19% INCREASE

IN EARNINGS PER SHARE AND 32% INCREASE IN FREE

CASH FLOW PER SHARE FOR ITS

THIRD QUARTER OF FISCAL YEAR 2005

          SUNNYVALE, CA–May 3, 2005–Maxim Integrated Products, Inc., (MXIM) reported net revenues of $400.2 million for its fiscal third quarter ending March 26, 2005, an 8.2% increase over the $370.0 million reported for the third quarter of fiscal year 2004 and an 8.2% decrease over the $436.1 million reported for the second quarter of fiscal 2005.  Net income for the quarter was $125.5 million, a 15.0% increase over the $109.2 million reported last year and a 13.2% decrease from the $144.6 million reported for the second quarter.  Diluted earnings per share were $0.37 for the third quarter, a 19.4% increase over the $0.31 reported for the same period a year ago and an 11.9% decrease from the $0.42 reported for the second quarter of fiscal 2005.  The Company’s free cash flow was $156 million, or $0.45 per diluted share for the third quarter, compared to $120 million, or $0.34 per diluted share, for the third quarter of fiscal year 2004.  This is a 32.4% increase in free cash flow per diluted share from the prior year’s comparable quarter.  For the nine months ended March 26, 2005 free cash flow per diluted share increased 20.8% relative to the comparable period last year.  Free cash flow is defined as cash from operating activities (after tax), less additions to property, plant and equipment as reported in the Company’s statements of cash flows.

– more –

          During the quarter, cash and short-term investments increased $116.5 million after the Company repurchased approximately 598,000 shares of its common stock for $24.5 million, paid dividends of $32.7 million, and acquired $13.8 million in capital equipment. At quarter end, cash and cash equivalents totaled $1.4 billion. Accounts receivable increased $12.7 million to $192.4 million, and inventories increased $12.9 million to $159.5 million in the third quarter.

          Gross margin for the third quarter was 72.0%, down from the 72.6% reported for the second quarter of fiscal year 2005. Research and development expense was $83.1 million or 20.8% of net revenues in the third quarter, compared to $81.0 million or 18.6% of net revenues in the second quarter of fiscal year 2005. Selling, general and administrative expenses decreased slightly from $25.3 million or 5.8% of net revenue in the second quarter to $24.7 million in the third quarter, or 6.2% of net revenue. 

          In the third quarter, the Company recorded a $5.0 million discretionary employee bonus to be paid out at the end of calendar 2005, which increased cost of goods sold by $1.6 million, increased research and development expense by $2.7 million, and increased selling, general and administrative expenses by $0.7 million.  The effect of this bonus reduced earnings by $0.01 per share.

          Also, during the quarter, Maxim reached an agreement with Linear Technology, Inc. regarding a patent in the battery management area.  The settlement agreement did not require the restatement of prior reported income as Maxim had accrued funds covering this license cost.  Going forward for the next 8 years, the license charge will be immaterial and partially offset by other new license fees received in the fourth quarter from other licensees.

          Third quarter bookings were approximately $373 million, a 6% increase from the second quarter’s level of $353 million. Turns orders received in the quarter were approximately $156 million or 42% of net bookings, a 28% increase over the $122 million or 35% of net bookings received in the prior quarter (turns orders are customer orders that are for delivery within the same quarter and may result in

– more –

 revenue within the same quarter if the Company has available inventory that matches those orders). Bookings increased in 15 out of the Company’s 20 end equipment segments and in all geographic locations except Europe.  Third quarter ending backlog shippable within the next 12 months was approximately $328 million, including approximately $284 million requested for shipment in the fourth quarter of fiscal year 2005. The Company’s second quarter ending backlog shippable within the next 12 months was approximately $370 million, including approximately $300 million that was requested for shipment in the third quarter of fiscal year 2005.

          The following reconciles free cash flow to net income, and it depicts the Company’s free cash flow for the three and nine months ended March 26, 2005 and March 27, 2004, respectively.

RECONCILIATION OF FREE CASH FLOW TO NET INCOME

(in millions, except per share data)	For the three months ended 3/26/05			For the three months ended 3/27/04			For the nine months ended 3/26/05			For the nine months ended 3/27/04
Net income, as reported	$	126		$	109		$	415		$	295
Add adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization, and other		19			14			57			44
Tax benefit related to stock plans		29			37			87			113
Accounts receivable		(13	)		(29	)		5			(36	)
Inventories		(13	)		5			(42	)		18
Accounts payable		(11	)		28			(44	)		43
Income taxes payable and deferred taxes		19			16			32			20
Other assets and liabilities		14			10			22			21
Total of adjustments		44			81			117			223
Cash generated by operating activities, as reported		170			190			532			518
Deduct:
Capital expenditures		(14	)		(70	)		(112	)		(163	)
Free cash flow	$	156		$	120		$	420		$	355
Fully diluted shares, as reported		343			354			344			352
Free cash flow per fully diluted share	$	0.45		$	0.34		$	1.22		$	1.01
Fully diluted earnings per share, as reported	$	0.37		$	0.31		$	1.21		$	0.84

– more –

          Free cash flow should not be construed as a substitute for net income or as a better measure of liquidity than cash flow from operating activities, both of which are determined in accordance with GAAP. Free cash flow excludes components that are significant in understanding and assessing the Company’s results of operations and cash flows. In addition, free cash flow is not a term defined by GAAP and as a result the Company’s measure of free cash flow might not be comparable to similarly titled measures used by other companies.

          Free cash flow is used by management to evaluate, assess, and benchmark the Company’s operating results, and the Company believes that free cash flow is relevant and useful information that is often widely used by analysts, investors, and other interested parties in the semiconductor industry. Accordingly, the Company is disclosing this information to permit a more comprehensive and objective analysis of the Company’s operating performance, to provide an additional measure of performance and liquidity, and to provide additional information with respect to the Company’s ability to meet future share repurchases, dividend payments, and working capital requirements.

          Jack Gifford, Chairman, President, and Chief Executive Officer, commented:  “As expected, third quarter bookings improved over the previous quarter.  It is a positive sign that a significant majority of our business units participated in this bookings increase.  Turns orders accelerated in the quarter as compared to the previous quarter leading us to believe that inventory levels have come further in line with consumption levels.” 

          Mr. Gifford continued: “Design-in activity of Maxim’s proprietary products remains strong which we believe positions us to gain market share over the next few years.  During the third quarter, the Company introduced 738 engineering man-months of new products, a Company record and a 31% increase over the second quarter.”

          Mr. Gifford continued: “The Company expects fiscal 2005 to contribute significant profit and cash flow to the Company over fiscal 2004.  Our employees need and deserve some expression of profit sharing reward for this result.  Since stock price appreciation during the last 4 years has not recognized our Company’s performance, we expect to accrue $0.01 per share for each quarter through the balance of the calendar year.  Officers, vice presidents and other senior executives will not receive this bonus.”

          Mr. Gifford concluded: “The Company’s Board of Directors has declared a quarterly cash dividend of $0.10 per share. Payment will be made on June 1, 2005 to stockholders of record on May 16, 2005.”

****

          Certain statements in this press release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve risk and uncertainty. They include statements regarding the Company’s profitability and business outlook, the Company’s belief that inventory levels have further come in line with consumption levels, and the Company’s belief that the Company’s proprietary products will continue to be well accepted in the marketplace. Actual results could differ materially from those forecasted based upon, among other things, general market conditions and market developments that could adversely affect the growth of the mixed-signal analog market, including, without limitation, declines in customer forecasts or greater than expected cyclical downturns within the mixed-signal analog segment of the semiconductor market; the inability of the Company’s customers to consume their inventory of Maxim products in the next one or two quarters; an unexpected decrease in revenue or increase in expenses; and the Company’s success in the markets its products are introduced in and the Company’s ability to effectively and successfully manage manufacturing operations, as well as other risks described in the Company’s Annual Report on Form 10-K filed with the SEC for the fiscal year ended June 26, 2004.

          All forward-looking statements included in this news release are made as of the date hereof, based on the information available to the Company as of the date hereof, and the Company assumes no obligation to update any forward-looking statement.

          Maxim Integrated Products is a leading international supplier of quality analog and mixed-signal products for applications that require real world signal processing.

#  #  #

Consolidated Balance Sheets

(In thousands)	3/26/05			6/26/04
	(unaudited)			(audited)
Assets
Current assets:
Cash and cash equivalents	$	142,482		$	147,734
Short-term investments		1,260,744			948,879
Total cash, cash equivalents and short-term investments		1,403,226			1,096,613
Accounts receivable, net		192,380			197,158
Inventories		159,463			117,785
Deferred tax assets and other current assets		157,605			166,558
Total current assets		1,912,674			1,578,114
Property, plant and equipment, at cost, less accumulated depreciation		999,403			942,186
Other assets		27,624			29,162
Total assets	$	2,939,701		$	2,549,462
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	50,157		$	93,856
Accrued expenses		205,332			182,692
Deferred income on shipments to distributors		20,095			22,858
Income taxes payable		16,145			19,339
Total current liabilities		291,729			318,745
Deferred tax liabilities		140,107			114,399
Other liabilities		4,000			4,000
Total liabilities		435,836			437,144
Stockholders’ equity:
Common stock		153,153			80,462
Retained earnings		2,362,317			2,038,820
Accumulated other comprehensive loss		(11,605	)		(6,964	)
Total stockholders’ equity		2,503,865			2,112,318
Total liabilities and stockholders’ equity	$	2,939,701		$	2,549,462

Consolidated Statements of Income

	Three Months Ending						Nine Months Ending
(In thousands except per share data)	3/26/05			3/27/04			3/26/05			3/27/04
	(unaudited)			(unaudited)			(unaudited)			(unaudited)
Net revenues	$	400,188		$	370,023		$	1,271,316		$	1,018,300
Cost of goods sold		111,896			111,761			351,585			307,818
Gross margin		288,292			258,262			919,731			710,482
		72.0	%		69.8	%		72.3	%		69.8	%
Operating expenses:
Research and development		83,141			77,255			243,273			218,562
Selling, general and administrative		24,713			23,546			75,099			67,128
Operating income		180,438			157,461			601,359			424,792
		45.1	%		42.6	%		47.3	%		41.7	%
Interest income, net		7,492			5,469			19,446			15,589
Income before provision for income taxes		187,930			162,930			620,805			440,381
Provision for income taxes		62,393			53,767			206,108			145,326
Net income	$	125,537		$	109,163		$	414,697		$	295,055
Basic earnings per share	$	0.38		$	0.33		$	1.27		$	0.90
Shares used in the calculation of basic earnings per share		326,945			328,247			325,758			327,894
Diluted earnings per share	$	0.37		$	0.31		$	1.21		$	0.84
Shares used in the calculation of diluted earnings per share		342,720			354,183			343,607			351,801
Dividends declared per share	$	0.10		$	0.08		$	0.28		$	0.24

Maxim Integrated Products, Incorporated
Company Profile

NASDAQ Symbol: MXIM • Founded 1983 • Public since: February 29, 1988

OPERATIONS

Corporate Offices:	120 San Gabriel Drive, Sunnyvale, California 94086
U.S. Sales Offices:	Sunnyvale and Costa Mesa, CA; Wheeling, IL; Roswell, GA; Chelmsford, MA; Austin and Dallas, TX; Beaverton, OR; Horsham, PA
Foreign Offices:	Munich, Germany; Tokyo, Japan; London, UK; Paris, France; Taipei, Taiwan; Seoul, South Korea; Hong Kong; Singapore; Milan, Italy; Beijing, China; Stockholm, Sweden; Zurich, Switzerland; Viborg, Denmark; Helsinki, Finland

PRODUCTS
Maxim designs, develops, manufactures and markets a broad range of linear and mixed-signal integrated circuits for use in a variety of electronic products. Maxim circuits “connect” the real world and the digital world by detecting, measuring, amplifying, and converting real world and communication signals, such as temperature, pressure, sound, voice, or light into the digital signals necessary for computer and DSP processing.

• Maxim serves approximately 35,000 customers worldwide.

• Maxim believes it has developed more products than any other analog company in the past 21 years.

• Maxim is recognized as the leader in CMOS analog and bipolar high-frequency technologies.

• 72% international sales for Q3 FY05.

FINANCIAL HIGHLIGHTS (In thousands, except EPS)

	FY2001			FY2002			FY2003			FY2004			Q3 FY2005
Net Revenues	$	1,576,613		$	1,025,104		$	1,153,219		$	1,439,263		$	400,188
Net Income	$	334,939		$	259,183		$	309,601		$	419,752		$	125,537
Shares		361,620			355,821			341,253			350,575			342,720
Diluted EPS	$	0.93		$	0.73		$	0.91		$	1.20		$	0.37
Cash and Short-Term Investments	$	1,220,352		$	765,501		$	1,164,007		$	1,096,613		$	1,403,226
Total Assets	$	2,430,531		$	2,010,812		$	2,367,962		$	2,549,462		$	2,939,701
Stockholders’ Equity	$	2,101,154		$	1,741,151		$	2,070,412		$	2,112,318		$	2,503,865
ROE		17.5	%		13.5	%		16.2	%		20.1	%		21.8	%
Market Cap	$	14,535,766		$	13,391,992		$	11,870,840		$	18,240,400		$	14,092,654

RESEARCH COVERAGE
A.G. Edwards, Brett Miller (314) 955-2620	Lehman Brothers, Romit Shah (212) 526-7865
Amtech Research, Doug Freedman (415) 490-3921	Merrill Lynch, Joseph Osha (415) 676-3510
C.E. Unterberg, Towbin, Ramesh Misra (415) 659-2289	Morgan Stanley, Louis Gerhardy (415) 576-2391
CIBC, Richard Schafer (720) 554-1119	Pacific Crest Securities, Michael McConnell (503) 790-7788
Credit Suisse First Boston, Michael Masdea (415) 836-7779	Pacific Growth Equities, Jim Liang (415) 274-6889
Deutsche Bank, Ross Seymore (415) 617-3268	RBC Capital, Apjit Walia (212) 428-6406
FBR, Christopher Caso (212) 381-9217	SG Cowen, Jack Romaine (212) 278-4230
Global Crown Capital, David Wu (415) 402-0518	Sanford C. Bernstein, Adam Parker (212) 756-4658
Goldman Sachs, Simona Jankowski (415) 249-7437	Smith Barney, Craig Ellis (415) 951-1887
Investec, Bobby Burleson, (212) 898-7716	U.S. Bancorp Piper Jaffray, Tore Svanberg (650) 838-1411
JMP Securities, Krishna Shankar (415) 835-8971	UBS, Tom Thornhill (415) 352-5667
JP Morgan, William Lewis (415) 315-6780	William Blair & Company LLC, Jeff Rosenberg (312) 364-8342