UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended July 1, 2022

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________to__________

Commission file number 001-05560

Skyworks Solutions, Inc.

(Exact name of registrant as specified in its charter)

Delaware			04-2302115
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)
5260 California Avenue	Irvine	California	92617
(Address of principal executive offices)			(Zip Code)

(949)	231-3000
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.25 per share	SWKS	Nasdaq Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   þ Yes ¨ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  þ Yes ¨ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer þ Accelerated filer ☐ Non-accelerated filer ☐  Smaller reporting company ☐ Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes þ No

As of July 29, 2022, the registrant had 160,445,593 shares of common stock, par value $0.25 per share, outstanding.

1

SKYWORKS SOLUTIONS, INC.

QUARTERLY REPORT ON FORM 10-Q

FOR THE QUARTER ENDED JULY 1, 2022

TABLE OF CONTENTS

	PAGE NO.
PART I. FINANCIAL INFORMATION
ITEM 1: FINANCIAL STATEMENTS (UNAUDITED)	2
CONSOLIDATED STATEMENTS OF OPERATIONS	2
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME	3
CONSOLIDATED BALANCE SHEETS	4
CONSOLIDATED STATEMENTS OF CASH FLOWS	5
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY	6
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS	8
ITEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	15
ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	20
ITEM 4: CONTROLS AND PROCEDURES	21
PART II. OTHER INFORMATION	22
ITEM 1: LEGAL PROCEEDINGS	22
ITEM 1A: RISK FACTORS	22
ITEM 2: UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	22
ITEM 6: EXHIBITS	23
SIGNATURES	24

1

PART 1. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

SKYWORKS SOLUTIONS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited, in millions, except per share amounts)

	Three Months Ended				Nine Months Ended
	July 1, 2022		July 2, 2021		July 1, 2022		July 2, 2021
Net revenue	$	1,232.6	$	1,116.4	$	4,078.6	$	3,798.2
Cost of goods sold	649.3		557.8		2,142.9		1,899.5
Gross profit	583.3		558.6		1,935.7		1,898.7
Operating expenses:
Research and development	156.5		130.8		468.4		383.1
Selling, general, and administrative	77.0		85.1		242.1		222.0
Amortization of intangibles	21.9		2.4		77.0		7.9
Restructuring, impairment, and other charges	2.1		0.5		9.3		0.5
Total operating expenses	257.5		218.8		796.8		613.5
Operating income	325.8		339.8		1,138.9		1,285.2
Interest expense	(11.3)		(2.6)		(33.6)		(2.6)
Other expense, net	(0.4)		(1.0)		(0.9)		(0.1)
Income before income taxes	314.1		336.2		1,104.4		1,282.5
Provision (benefit) for income taxes	46.8		(1.6)		131.4		110.5
Net income	$	267.3	$	337.8	$	973.0	$	1,172.0
Earnings per share:
Basic	$	1.66	$	2.05	$	5.96	$	7.10
Diluted	$	1.66	$	2.02	$	5.93	$	7.02
Weighted average shares:
Basic	160.9		165.1		163.3		165.2
Diluted	161.5		167.0		164.1		166.9

See accompanying Notes to Consolidated Financial Statements.

2

SKYWORKS SOLUTIONS, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited, in millions)

	Three Months Ended				Nine Months Ended
	July 1, 2022		July 2, 2021		July 1, 2022		July 2, 2021
Net income	$	267.3	$	337.8	$	973.0	$	1,172.0
Other comprehensive income (loss), net of tax:
Fair value of investments	0.2		(0.2)		(0.2)		(0.5)
Pension adjustments	—		—		3.3		0.3
Comprehensive income	$	267.5	$	337.6	$	976.1	$	1,171.8

See accompanying Notes to Consolidated Financial Statements.

3

SKYWORKS SOLUTIONS, INC.

CONSOLIDATED BALANCE SHEETS

(In millions, except per share amounts)

	As of
	July 1, 2022		October 1, 2021
ASSETS	(unaudited)
Current assets:
Cash and cash equivalents	$	643.0	$	882.9
Marketable securities	16.2		137.2
Receivables, net of allowances of $0.8 and $0.7, respectively	785.6		756.2
Inventory	1,102.0		885.0
Other current assets	361.2		204.1
Total current assets	2,908.0		2,865.4
Property, plant, and equipment, net	1,607.4		1,501.6
Operating lease right-of-use assets	208.3		166.1
Goodwill	2,176.7		2,176.7
Intangible assets, net	1,541.8		1,698.6
Deferred tax assets, net	101.5		119.5
Marketable securities	3.0		7.1
Other long-term assets	147.9		55.7
Total assets	$	8,694.6	$	8,590.7
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	319.9	$	236.0
Accrued compensation and benefits	109.0		135.3
Current portion of long-term debt	498.8		—
Other current liabilities	298.4		287.2
Total current liabilities	1,226.1		658.5
Long-term debt	1,689.4		2,235.6
Long-term tax liabilities	227.8		222.8
Long-term operating lease liabilities	189.5		144.5
Other long-term liabilities	67.2		32.2
Total liabilities	3,400.0		3,293.6
Commitments and contingencies (Note 9)
Stockholders’ equity:
Preferred stock, no par value: 25.0 shares authorized, no shares issued	—		—
Common stock, $0.25 par value: 525.0 shares authorized; 166.9 shares issued and 160.7 shares outstanding at July 1, 2022, and 165.3 shares issued and 165.3 shares outstanding at October 1, 2021	40.1		41.3
Additional paid-in capital	267.6		79.6
Treasury stock, at cost	(893.4)		(1.7)
Retained earnings	5,885.1		5,185.8
Accumulated other comprehensive loss	(4.8)		(7.9)
Total stockholders’ equity	5,294.6		5,297.1
Total liabilities and stockholders’ equity	$	8,694.6	$	8,590.7

See accompanying Notes to Consolidated Financial Statements.

4

SKYWORKS SOLUTIONS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited, in millions)

	Nine Months Ended
	July 1, 2022		July 2, 2021
Cash flows from operating activities:
Net income	$	973.0	$	1,172.0
Adjustments to reconcile net income to net cash provided by operating activities:
Share-based compensation	158.2		144.3
Depreciation	289.6		242.9
Amortization of intangible assets, including inventory step-up	219.1		23.8
Deferred income taxes	30.3		(2.6)
Amortization of debt discount and issuance costs	3.0		—
Other, net	(5.1)		0.2
Changes in assets and liabilities:
Receivables, net	(29.4)		(176.9)
Inventory	(227.8)		(5.9)
Accounts payable	32.5		21.8
Other current and long-term assets and liabilities	(255.1)		(45.9)
Net cash provided by operating activities	1,188.3		1,373.7
Cash flows from investing activities:
Capital expenditures	(347.7)		(374.8)
Purchased intangibles	(16.3)		(7.4)
Purchases of marketable securities	(91.4)		(408.4)
Sales and maturities of marketable securities	216.2		689.6
Receipts from the sales of property, plant, and equipment	7.6		—
Net cash used in investing activities	(231.6)		(101.0)
Cash flows from financing activities:
Repurchase of common stock - payroll tax withholdings on equity awards	(85.2)		(53.6)
Repurchase of common stock - stock repurchase program	(806.5)		(195.6)
Dividends paid	(273.7)		(248.1)
Net proceeds from exercise of stock options	3.2		7.8
Proceeds from employee stock purchase plan	15.6		12.7
Proceeds from issuance of long-term debt, net	—		1,489.7
Debt financing costs	—		(7.3)
Payments of debt	(50.0)		—
Net cash provided by (used in) financing activities	(1,196.6)		1,005.6
Net increase (decrease) in cash and cash equivalents	(239.9)		2,278.3
Cash and cash equivalents at beginning of period	882.9		566.7
Cash and cash equivalents at end of period	$	643.0	$	2,845.0
Supplemental cash flow disclosures:
Income taxes paid	$	167.9	$	136.5
Interest paid	$	29.0	$	—
Incentives paid in common stock	$	32.2	$	27.5
Non-cash investing in capital expenditures, accrued but not paid	$	127.3	$	149.9
Operating lease assets obtained in exchange for new lease liabilities	$	64.3	$	15.9
Retirement of treasury stock	$	—	$	4,342.6

See accompanying Notes to Consolidated Financial Statements.

5

SKYWORKS SOLUTIONS, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In millions)

	Shares of common stock	Par value of common stock		Shares of treasury stock	Value of treasury stock		Additional paid-in capital		Retained earnings		Accumulated other comprehensive loss		Total stockholders’ equity
Balance at October 1, 2021	165.3	$	41.3	—	$	(1.7)	$	79.6	$	5,185.8	$	(7.9)	$	5,297.1
Net income	—	—		—	—		—		399.9		—		399.9
Exercise and settlement of share-based awards, net of shares withheld for taxes	0.9	0.2		0.5	(80.1)		33.8		—		—		(46.1)
Share-based compensation expense	—	—		—	—		42.0		—		—		42.0
Stock repurchase program	(1.7)	(0.4)		1.7	(269.4)		0.4		—		—		(269.4)
Dividends declared	—	—		—	—		—		(92.5)		—		(92.5)
Other comprehensive income	—	—		—	—		—		—		3.2		3.2
Balance at December 31, 2021	164.5	$	41.1	2.2	$	(351.2)	$	155.8	$	5,493.2	$	(4.7)	$	5,334.2
Net income	—	$	—	—	$	—	$	—	305.8		—		305.8
Exercise and settlement of share-based awards, net of shares withheld for taxes	0.2	—		—	(3.5)		16.3		—		—		12.8
Share-based compensation expense	—	—		—	—		45.3		—		—		45.3
Stock repurchase program	(3.0)	(0.7)		3.0	(418.0)		0.7		—		—		(418.0)
Dividends declared	—	—		—	—		—		(91.2)		—		(91.2)
Other comprehensive loss	—	—		—	—		—		—		(0.3)		(0.3)
Balance at April 1, 2022	161.7	$	40.4	5.2	$	(772.7)	$	218.1	$	5,707.8	$	(5.0)	$	5,188.6
Net income	—	—		—	—		—		267.3		—		267.3
Exercise and settlement of share-based awards, net of shares withheld for taxes	—	—		—	(1.6)		0.6		—		—		(1.0)
Share-based compensation expense	—	—		—	—		48.6		—		—		48.6
Dividends declared	—	—		—	—		—		(90.0)		—		(90.0)
Stock repurchase program	(1.0)	(0.3)		1.0	(119.1)		0.3		—		—		(119.1)
Other comprehensive income	—	—		—	—		—		—		0.2		0.2
Balance at July 1, 2022	160.7	$	40.1	6.2	$	(893.4)	$	267.6	$	5,885.1	$	(4.8)	$	5,294.6
Balance at October 2, 2020	165.6	$	41.4	66.7	$	(4,093.5)	$	3,403.7	$	4,820.4	$	(7.8)	$	4,164.2
Net income	—	—		—	—		—		509.3		—		509.3
Exercise and settlement of share-based awards, net of shares withheld for taxes	0.7	0.2		0.4	(47.8)		30.1		—		—		(17.5)
Share-based compensation expense	—	—		—	—		37.4		—		—		37.4
Stock repurchase program	(1.4)	(0.4)		1.4	(195.6)		0.4		—		—		(195.6)
Dividends declared	—	—		—	—		—		(83.0)		—		(83.0)
Other comprehensive income	—	—		—	—		—		—		0.1		0.1
Balance at January 1, 2021	164.9	$	41.2	68.5	$	(4,336.9)	$	3,471.6	$	5,246.7	$	(7.7)	$	4,414.9
Net income	—	—		—	—		—		325.0		—		325.0
Exercise and settlement of share-based awards, net of shares withheld for taxes	0.2	0.1		—	(3.6)		16.9		—		—		13.4
Share-based compensation expense	—	—		—	—		41.7		—		—		41.7
Dividends declared	—	—		—	—		—		(82.6)		—		(82.6)
Other comprehensive loss	—	—		—	—		—		—		(0.1)		(0.1)
Balance at April 2, 2021	165.1	$	41.3	68.5	$	(4,340.5)	$	3,530.2	$	5,489.1	$	(7.8)	$	4,712.3
Net income	—	—		—	—		—		337.8		—		337.8
Exercise and settlement of share-based awards, net of shares withheld for taxes	—	—		—	(2.2)		0.7		—		—		(1.5)

6

Share-based compensation expense	—	—		—	—		36.9		—		—		36.9
Retirement of treasury stock	—	—		(68.5)	4,342.6		(3,550.3)		(792.3)		—		—
Dividends declared	—	—		—	—		—		(82.5)		—		(82.5)
Other comprehensive loss	—	—		—	—		—		—		(0.2)		(0.2)
Balance at July 2, 2021	165.1	$	41.3	—	$	(0.1)	$	17.5	$	4,952.1	$	(8.0)	$	5,002.8

See accompanying Notes to Consolidated Financial Statements.

7

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.     DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Skyworks Solutions, Inc., together with its consolidated subsidiaries (“Skyworks” or the “Company”), is empowering the wireless networking revolution. The Company’s analog semiconductors are connecting people, places, and things, spanning a number of new applications within the aerospace, automotive, broadband, cellular infrastructure, connected home, entertainment and gaming, industrial, medical, military, smartphone, tablet, and wearable markets.

The accompanying unaudited interim consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial reporting. Certain information and footnote disclosures, normally included in annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”), have been condensed or omitted pursuant to those rules and regulations. However, in management’s opinion, the financial information reflects all adjustments, including those of a normal recurring nature, necessary to present fairly the results of operations, financial position, and cash flows of the Company for the periods presented. The results of operations, financial position, and cash flows for the Company during the interim periods are not necessarily indicative of those expected for the full year. This information should be read in conjunction with the Company’s financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the fiscal year ended October 1, 2021, filed with the SEC on November 24, 2021, as amended by Amendment No. 1 to such Annual Report on Form 10-K, filed with the SEC on January 28, 2022 (“2021 10-K”).

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts of assets, liabilities, revenue, expenses, comprehensive income, and accumulated other comprehensive loss that are reported during the reporting period. The Company evaluates its estimates on an ongoing basis using historical experience and other factors, including the current economic environment. Judgment is required in determining the reserves for, and fair value of, items such as overall fair value assessments of assets and liabilities, particularly those classified as Level 2 or Level 3 in the fair value hierarchy, marketable securities, inventory, intangible assets associated with business combinations, share-based compensation, revenue reserves, loss contingencies, and income taxes. In addition, judgment is required in determining whether a potential indicator of impairment of long-lived assets exists and in estimating future cash flows for any necessary impairment testing. Actual results could differ significantly from these estimates.

The Company’s fiscal year ends on the Friday closest to September 30. Fiscal 2022 consists of 52 weeks and ends on September 30, 2022. Fiscal 2021 consisted of 52 weeks and ended on October 1, 2021. The three and nine months ended July 1, 2022, and July 2, 2021, each consisted of 13 weeks and 39 weeks, respectively.

2.    REVENUE RECOGNITION

The Company presents net revenue by geographic area, based upon the location of the original equipment manufacturers’ (“OEMs”) headquarters, and by sales channel, as it believes that doing so best depicts how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors. Individually insignificant OEMs are presented based upon the location of the Company's direct customer, which is typically a distributor. Net revenue by geographic area is as follows (in millions):

	Three Months Ended				Nine Months Ended
	July 1, 2022		July 2, 2021		July 1, 2022		July 2, 2021
United States	$	813.0	$	636.0	$	2,630.9	$	2,372.6
China	98.9		262.0		487.8		759.6
South Korea	146.4		70.6		398.6		205.0
Taiwan	99.7		90.4		324.3		310.6
Europe, Middle East, and Africa	58.3		49.5		180.6		128.7
Other Asia-Pacific	16.3		7.9		56.4		21.7
Total net revenue	$	1,232.6	$	1,116.4	$	4,078.6	$	3,798.2

8

Net revenue by sales channel is as follows (in millions):

	Three Months Ended				Nine Months Ended
	July 1, 2022		July 2, 2021		July 1, 2022		July 2, 2021
Distributors	$	947.8	$	982.7	$	3,309.3	$	3,396.1
Direct customers	284.8		133.7		769.3		402.1
Total net revenue	$	1,232.6	$	1,116.4	$	4,078.6	$	3,798.2

The Company’s revenue from external customers is generated principally from the sale of semiconductor products that facilitate various wireless communication applications. Accordingly, the Company considers its product offerings to be similar in nature and therefore not segregated for reporting purposes.

3.    MARKETABLE SECURITIES

The Company’s portfolio of available-for-sale marketable securities consists of the following (in millions):    

	Current				Noncurrent
	July 1, 2022		October 1, 2021		July 1, 2022		October 1, 2021
U.S. Treasury and government	$	8.0	$	7.6	$	2.9	$	6.0
Corporate bonds and notes	—		117.0		—		—
Municipal bonds	8.2		12.6		0.1		1.1
Total marketable securities	$	16.2	$	137.2	$	3.0	$	7.1

The contractual maturities of noncurrent available-for-sale marketable securities were within two years or less of issuance of the applicable securities. Neither gross unrealized gains and losses nor realized gains and losses were material as of July 1, 2022, and October 1, 2021, respectively.

4.    FAIR VALUE

Assets and Liabilities Measured and Recorded at Fair Value on a Recurring Basis

The Company groups its financial assets and liabilities measured at fair value on a recurring basis in three levels, based on the markets in which the assets and liabilities are traded and the reliability of the assumptions used to determine fair value. These levels are:

•Level 1 - Quoted prices in active markets for identical assets or liabilities.

•Level 2 - Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets with insufficient volume or infrequent transactions (less-active markets), or model-driven valuations in which all significant inputs are observable or can be derived principally from, or corroborated with, observable market data.

•Level 3 - Fair value is derived from valuation techniques in which one or more significant inputs are unobservable, including assumptions and judgments made by the Company.

9

Assets and liabilities recorded at fair value on a recurring basis consisted of the following (in millions):         

	As of
	July 1, 2022								October 1, 2021
			Fair Value Measurements								Fair Value Measurements
	Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3
Assets
Cash and cash equivalents*	$	643.0	$	643.0	$	—	$	—	$	882.9	$	882.9	$	—	$	—
U.S. Treasury and government securities	10.9		1.2		9.7		—		13.6		2.6		11.0		—
Corporate bonds and notes	—		—		—		—		117.0		—		117.0		—
Municipal bonds	8.3		—		8.3		—		13.7		—		13.7		—
Total assets at fair value	$	662.2	$	644.2	$	18.0	$	—	$	1,027.2	$	885.5	$	141.7	$	—

* Cash equivalents included in Levels 1 and 2 consist of money market funds and corporate bonds and notes, commercial paper, and agency securities purchased with less than ninety days until maturity.

Assets Measured and Recorded at Fair Value on a Nonrecurring Basis

The Company’s non-financial assets and liabilities, such as goodwill, intangible assets, and other long-lived assets resulting from business combinations, are measured at fair value using income approach valuation methodologies at the date of acquisition and are subsequently re-measured if there are indicators of impairment. There were no indicators of impairment identified during the three and nine months ended July 1, 2022.

Fair Value of Debt

The Company’s debt is carried at amortized cost and is measured at fair value quarterly for disclosure purposes. The estimated fair values are based on Level 2 inputs as the fair value is based on quoted prices for the Company’s debt and comparable instruments in inactive markets. The carrying value of the Term Loan (as defined below) approximates its fair value as the Term Loan is carried at a market observable interest rate that resets periodically.

The carrying amount and estimated fair value of debt consists of the following (in millions):

	As of
	July 1, 2022				October 1, 2021
	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
0.90% Senior Notes due 2023	$	498.8	$	486.4	$	498.2	$	501.0
1.80% Senior Notes due 2026	496.6		445.8		496.2		507.5
3.00% Senior Notes due 2031	494.4		414.6		494.0		514.6
Total debt	$	1,489.8	$	1,346.8	$	1,488.4	$	1,523.1

5.     INVENTORY

Inventory consists of the following (in millions):

	As of
	July 1, 2022		October 1, 2021
Raw materials	$	73.1	$	62.2
Work-in-process	770.8		595.9
Finished goods	254.5		224.4
Finished goods held on consignment by customers	3.6		2.5
Total inventory	$	1,102.0	$	885.0

10

6.     PROPERTY, PLANT, AND EQUIPMENT, NET

Property, plant, and equipment, net consists of the following (in millions):

	As of
	July 1, 2022		October 1, 2021
Land and improvements	$	11.9	$	11.9
Buildings and improvements	535.9		470.7
Furniture and fixtures	70.4		60.2
Machinery and equipment	3,256.3		2,990.2
Construction in progress	174.6		177.0
Total property, plant, and equipment, gross	4,049.1		3,710.0
Accumulated depreciation	(2,441.7)		(2,208.4)
Total property, plant, and equipment, net	$	1,607.4	$	1,501.6

7.     GOODWILL AND INTANGIBLE ASSETS

There were no changes to the carrying amount of goodwill during the three and nine months ended July 1, 2022.

The Company tests its goodwill for impairment annually as of the first day of its fourth fiscal quarter and in interim periods if certain events occur indicating the carrying value of goodwill may be impaired. There were no indicators of impairment noted during the three and nine months ended July 1, 2022.

Intangible assets consist of the following (in millions):

		As of						As of
	Weighted Average Amortization Period (Years)	July 1, 2022						October 1, 2021
		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Customer relationships and backlog	2.3	154.6		(100.6)		54.0		174.3		(44.0)		130.3
Developed technology and other	4.1	1,154.7		(160.6)		994.1		1,036.9		(88.0)		948.9
Technology licenses	2.8	103.4		(37.4)		66.0		48.4		(23.9)		24.5
In-process research and development		427.7		—		427.7		594.9		—		594.9
Total intangible assets		$	1,840.4	$	(298.6)	$	1,541.8	$	1,854.5	$	(155.9)	$	1,698.6

Fully amortized intangible assets are eliminated from both the gross and accumulated amortization amounts in the first quarter of each fiscal year. During the nine months ended July 1, 2022, $167.2 million of in-process research and development (“IPR&D”) assets were transferred to definite-lived intangible assets, and are being amortized over their weighted-average useful lives of 6.6 years. Amortization expense related to definite-lived intangible assets was $65.9 million and $211.8 million for the three and nine months ended July 1, 2022, respectively. Amortization expense related to definite-lived intangible assets was $6.3 million and $23.8 million for the three and nine months ended July 2, 2021, respectively.

Annual amortization expense for the next five fiscal years related to definite-lived intangible assets, excluding IPR&D, is expected to be as follows (in millions):

	Remaining 2022		2023		2024		2025		2026		Thereafter
Amortization expense	$	68.2	$	212.2	$	164.8	$	144.0	$	119.8	$	405.1

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8.     INCOME TAXES

The provision for income taxes consists of the following components (in millions):

	Three Months Ended						Nine Months Ended
	July 1, 2022			July 2, 2021			July 1, 2022			July 2, 2021
United States income taxes	35.8			(13.8)			88.5			63.7
Foreign income taxes	11.0			12.2			42.9			46.8
Provision (benefit) for income taxes	$	46.8		$	(1.6)		$	131.4		$	110.5
Effective tax rate	14.9		%	(0.5)		%	11.9		%	8.6		%

The difference between the Company’s effective tax rate and the 21.0% United States federal statutory rate for the three and nine months ended July 1, 2022, and July 2, 2021, respectively, resulted primarily from foreign earnings taxed at rates lower than the federal statutory rate, a benefit from foreign-derived intangible income deduction (“FDII”), windfall tax deductions, and research and experimentation and foreign tax credits earned, partially offset by a tax on global intangible low-taxed income (“GILTI”), and tax expense related to a change in the reserve for uncertain tax positions.

9.    COMMITMENTS AND CONTINGENCIES

Legal Matters

From time to time, various lawsuits, claims, and proceedings have been, and may in the future be, instituted or asserted against the Company, including those pertaining to patent infringement, intellectual property, environmental hazards, product liability and warranty, safety and health, employment, and contractual matters.

The semiconductor industry is characterized by vigorous protection and pursuit of intellectual property rights. From time to time, third parties have asserted and may in the future assert patent, copyright, trademark, and other intellectual property rights to technologies that are important to the Company’s business and have demanded and may in the future demand that the Company license their technology. The outcome of any such litigation cannot be predicted with certainty and some such lawsuits, claims, or proceedings may be disposed of unfavorably to the Company. Generally speaking, intellectual property disputes often have a risk of injunctive relief, which, if imposed against the Company, could materially and adversely affect the Company’s financial condition or results of operations. From time to time the Company may also be involved in legal proceedings in the ordinary course of business.

The Company monitors the status of legal proceedings and other contingencies on an ongoing basis to ensure loss contingencies are recognized and/or disclosed in its financial statements and footnotes. The Company does not believe there are any pending legal proceedings that are reasonably possible to result in a material loss. The Company is engaged in various legal actions in the normal course of business and, while there can be no assurances, the Company believes the outcome of all pending litigation involving the Company will not have, individually or in the aggregate, a material adverse effect on its business or financial statements.

Guarantees and Indemnities

The Company has made no significant contractual guarantees for the benefit of third parties. However, the Company generally indemnifies its customers from third-party intellectual property infringement litigation claims related to its products and, on occasion, also provides other indemnities related to product sales. In connection with certain facility leases, the Company has indemnified its lessors for certain claims arising from the facility or the lease.

The Company indemnifies its directors and officers to the maximum extent permitted under the laws of the state of Delaware. The duration of the indemnities varies and in many cases is indefinite. The indemnities to customers in connection with product sales generally are subject to limits based upon the amount of the related product sales and in many cases are subject to geographic and other restrictions. In certain instances, the Company’s indemnities do not provide for any limitation of the maximum potential future payments the Company could be obligated to make. The Company has not recorded any liability for these indemnities in the accompanying consolidated balance sheets and does not expect that such obligations will have a material adverse impact on its financial statements.

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10.     STOCKHOLDERS’ EQUITY

Stock Repurchase

On January 26, 2021, the Board of Directors approved a stock repurchase program, pursuant to which the Company is authorized to repurchase up to $2.0 billion of its common stock from time to time prior to January 26, 2023, on the open market or in privately negotiated transactions, as permitted by securities laws and other legal requirements. This authorized stock repurchase program replaced in its entirety the January 30, 2019, stock repurchase program. The timing and amount of any shares of the Company’s common stock that are repurchased under the repurchase program are determined by the Company’s management based on its evaluation of market conditions and other factors.

During the three months ended July 1, 2022, the Company paid $119.1 million (including commissions) in connection with the repurchase of 1.0 million shares of its common stock (paying an average price of $119.07 per share). During the nine months ended July 1, 2022, the Company paid $806.5 million (including commissions) in connection with the repurchase of 5.7 million shares of its common stock (paying an average price of $141.30 per share), all of which shares were repurchased pursuant to the January 26, 2021, stock repurchase program. As of July 1, 2022, $1.2 billion remained available under the January 26, 2021, stock repurchase program.

During the three months ended July 2, 2021, the Company did not repurchase any shares of its common stock. During the nine months ended July 2, 2021, the Company paid $195.6 million (including commissions) in connection with the repurchase of 1.4 million shares of its common stock (paying an average price of $138.85 per share), all of which shares were repurchased pursuant to the January 30, 2019, stock repurchase program.

Dividends

On August 4, 2022, the Company announced that the Board of Directors had declared a cash dividend on the Company’s common stock of $0.62 per share. This dividend is payable on September 15, 2022, to the Company’s stockholders of record as of the close of business on August 25, 2022.

Dividends charged to retained earnings were as follows (in millions, except per share data):

	2022				2021
	Per Share		Total Amount		Per Share		Total Amount
First quarter	$	0.56	$	92.5	$	0.50	$	83.0
Second quarter	0.56