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) |
Exhibit No. | Description |
99.1 | Press Release Dated July 31, 2017 |
Dated: | July 31, 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 |
99.1 | Press Release Dated July 31, 2017. |
Financial Contact: | Press Contact: | |
Suzanne Schmidt IDT Investor Relations Phone: (408) 284-6515 E-mail: ir@idt.com | Daniel Aitken IDT Senior Director of Corporate Marketing and Communications Phone: (408) 574-6480 E-mail: daniel.aitken@idt.com |
• | IDT partnered with LG to enable wireless charging electronics in LG’s flagship smartphones (LG G6). |
• | IDT and Samsung teamed up again to bring rapid wireless charging to Samsung’s Galaxy S8 and S8+ models. The wireless power technology partnership on the Galaxy S8 is significant and continues the integration of magnetic secure transmission (MST) payment technology. |
• | IDT announced its IDT® 8T49N240, a highly-programmable clock generator and jitter attenuator IC featuring less than 200fs of phase noise that provides valuable system design margin for 10Gbps interfaces in wireline and wireless communication networks. The additional phase noise margin alleviates system design constraints, allowing engineers to reduce bit error rates (BER) while decreasing overall system costs. |
• | IDT won Ericsson Semiconductor Supplier Award 2017 for excellent and consistent performance and company’s support of technology leadership in mobile broadband and evolution to 5G. |
• | IDT introduced new flash memory expander to allow customers the ability to increase solid state drive (SSD) memory at a reduced cost. The IDT MX0141V is the first 1:4 bidirectional multiplexer explicitly designed for this application. The MX0141V permits the expansion of SSD memory without the need for additional controllers and is designed for datacenter, enterprise and consumer memory subsystems. |
• | IDT announced sampling of its 4RCD0232K register and 4DB0232K data buffer to customers and ecosystem partners. This chipset combines new features that were included in the latest generation of the JEDEC standard defined for 3200MT/s capability devices which include decision feedback equalization (DFE), dedicated NVDIMM communication ports and fine granularity output signal ring-back control. This chipset also consumes the lowest power of any DDR4 chipset in the industry today. |
• | IDT exhibited Advanced Sensing Technologies at SENSOR+TEST 2017 in Nurnberg, Germany. Technologies included: ZMID520x inductive position sensor, ZSSC4175 automotive sensor signal conditioner for dual voltage source sensor inputs with SENT or I2C output, ZSSC4165 automotive senor signal conditioner for dual resistive bridges with SENT or I2C output, ZSSC3018 sensor signal conditioner for high-accuracy amplification and analog-to-digital conversion of differential or pseudo-differential input signal and wireless charging solutions designed for automotive applications. |
• | IDT presented Contactless Position Sensors at Sensors Expo 2017 in San Jose, California. Sensors displayed included the innovative IDT® ZMID520x inductive position sensors that are AEC-Q100-qualified, magnet-free sensors ideal for a variety of automotive, industrial and consumer applications. |
• | Revenue for the fiscal first quarter of 2018 was $196.7 million. This compared with $175.7 million reported last quarter, and $192.1 million reported in the same period one year ago. |
• | GAAP net income for the fiscal first quarter of 2018 was $16.7 million, or $0.12 per diluted share, versus GAAP net income of $30.2 million or $0.22 per diluted share last quarter, and GAAP net income of $20.9 million or $0.15 per diluted share in the same period one year ago. Fiscal first quarter GAAP results include $17.8 million in acquisition and restructuring charges, $11.8 million in stock-based compensation, $3.9 million in non-cash interest expense, $1.7 million in certain unrealized foreign exchange gain and $3.3 million provision in related tax effects. |
• | Non-GAAP net income for the fiscal first quarter of 2018 was $45.3 million or $0.33 per diluted share, compared with non-GAAP net income of $48.1 million or $0.35 per diluted share last quarter, and non-GAAP net income of $51.2 million or $0.36 per diluted share reported in the same period one year ago. |
• | GAAP gross profit for the fiscal first quarter of 2018 was $110.0 million, or 55.9 percent, compared with GAAP gross profit of $101.7 million or 57.9 percent last quarter, and $108.3 million, or 56.4 percent, reported in the same period |
• | GAAP R&D expense for the fiscal first quarter of 2018 was $48.4 million, compared with GAAP R&D expense of $35.5 million last quarter, and $49.6 million reported in the same period one year ago. Non-GAAP R&D expense for the fiscal first quarter of 2018 was $40.3 million, compared with non-GAAP R&D expense of $31.0 million last quarter, and $37.7 million in the same period one year ago. |
• | GAAP SG&A expense for the fiscal first quarter of 2018 was $41.9 million, compared with GAAP SG&A expense of $36.2 million last quarter, and $38.8 million in the same period one year ago. Non-GAAP SG&A expense for the fiscal first quarter of 2018 was $30.8 million, compared with non-GAAP SG&A expense of $27.2 million last quarter, and $28.3 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 and retention 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 |
INTEGRATED DEVICE TECHNOLOGY, INC. | |||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||
(Unaudited) | |||||||||||||||
(In thousands, except per share data) | |||||||||||||||
Three Months Ended | |||||||||||||||
July 2, 2017 | April 2, 2017 | July 3, 2016 | |||||||||||||
Revenues | $ | 196,713 | $ | 175,698 | $ | 192,128 | |||||||||
Cost of revenues | 86,675 | 74,026 | 83,779 | ||||||||||||
Gross profit | 110,038 | 101,672 | 108,349 | ||||||||||||
Operating expenses: | |||||||||||||||
Research and development | 48,449 | 35,533 | 49,648 | ||||||||||||
Selling, general and administrative | 41,942 | 36,225 | 38,816 | ||||||||||||
Total operating expenses | 90,391 | 71,758 | 88,464 | ||||||||||||
Operating income | 19,647 | 29,914 | 19,885 | ||||||||||||
Interest and other expense, net | (3,915 | ) | (2,153 | ) | (2,496 | ) | |||||||||
Income before income taxes | 15,732 | 27,761 | 17,389 | ||||||||||||
Benefit from income taxes | 982 | 2,448 | 3,558 | ||||||||||||
Net income | $ | 16,714 | $ | 30,209 | $ | 20,947 | |||||||||
Basic net income per share | $ | 0.13 | $ | 0.23 | $ | 0.16 | |||||||||
Diluted net income per share | $ | 0.12 | $ | 0.22 | $ | 0.15 | |||||||||
Weighted average shares: | |||||||||||||||
Basic | 133,302 | 133,309 | 133,934 | ||||||||||||
Diluted | 136,642 | 136,903 | 138,109 | ||||||||||||
INTEGRATED DEVICE TECHNOLOGY, INC. | ||||||||||||
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (a) | ||||||||||||
(Unaudited) | ||||||||||||
(In thousands, except per share data) | ||||||||||||
Three Months Ended | ||||||||||||
July 2, 2017 | April 2, 2017 | July 3, 2016 | ||||||||||
GAAP net income | $ | 16,714 | $ | 30,209 | $ | 20,947 | ||||||
GAAP diluted net income per share | $ | 0.12 | $ | 0.22 | $ | 0.15 | ||||||
Acquisition related: | ||||||||||||
Amortization of acquisition related intangibles | 8,876 | 4,782 | 5,775 | |||||||||
Acquisition related costs | 2,225 | 2,223 | — | |||||||||
Amortization of fair market value adjustment to inventory | 4,081 | 407 | 2,395 | |||||||||
Restructuring related: | ||||||||||||
Severance and retention costs (benefit) | 653 | (387 | ) | 11,918 | ||||||||
Facility closure costs | — | — | 19 | |||||||||
Assets impairment and other | 1,965 | 156 | 870 | |||||||||
Other: | ||||||||||||
Stock-based compensation expense | 11,820 | 10,266 | 10,515 | |||||||||
Non-cash interest expense | 3,892 | 3,393 | 3,268 | |||||||||
Certain unrealized foreign exchange gain | (1,675 | ) | — | — | ||||||||
Compensation expense - deferred compensation plan | 412 | 486 | 402 | |||||||||
Gain on deferred compensation plan securities | (360 | ) | (474 | ) | (392 | ) | ||||||
Non-GAAP tax adjustments | (3,341 | ) | (2,942 | ) | (4,540 | ) | ||||||
Non-GAAP net income | $ | 45,262 | $ | 48,119 | $ | 51,177 | ||||||
GAAP weighted average shares - diluted | 136,642 | 136,903 | 138,109 | |||||||||
Non-GAAP adjustment | 2,319 | 1,596 | 2,287 | |||||||||
Non-GAAP weighted average shares - diluted | 138,961 | 138,499 | 140,396 | |||||||||
Non-GAAP diluted net income per share | $ | 0.33 | $ | 0.35 | $ | 0.36 | ||||||
GAAP gross profit | $ | 110,038 | $ | 101,672 | $ | 108,349 | ||||||
Acquisition related: | ||||||||||||
Amortization of acquisition related intangibles | 5,682 | 3,116 | 3,415 | |||||||||
Amortization of fair market value adjustment to inventory | 4,081 | 407 | 2,395 | |||||||||
Restructuring related: | ||||||||||||
Severance and retention costs (benefit) | 196 | (36 | ) | 2,430 | ||||||||
Assets impairment and other | — | 156 | 336 | |||||||||
Other: | ||||||||||||
Compensation expense - deferred compensation plan | 97 | 114 | 148 | |||||||||
Stock-based compensation expense | 632 | 660 | 779 | |||||||||
Non-GAAP gross profit | $ | 120,726 | $ | 106,089 | $ | 117,852 | ||||||
GAAP R&D expenses: | $ | 48,449 | $ | 35,533 | $ | 49,648 | ||||||
Restructuring related: | ||||||||||||
Severance and retention costs | (45 | ) | (44 | ) | (7,334 | ) | ||||||
Assets impairment and other | (1,965 | ) | — | (107 | ) | |||||||
Other: |
Compensation expense - deferred compensation plan | (210 | ) | (248 | ) | (157 | ) | ||||||
Stock-based compensation expense | (5,963 | ) | (4,226 | ) | (4,308 | ) | ||||||
Non-GAAP R&D expenses | $ | 40,266 | $ | 31,015 | $ | 37,742 | ||||||
GAAP SG&A expenses: | $ | 41,942 | $ | 36,225 | $ | 38,816 | ||||||
Acquisition related: | ||||||||||||
Amortization of acquisition related intangibles | (3,194 | ) | (1,666 | ) | (2,360 | ) | ||||||
Acquisition related costs | (2,225 | ) | (2,223 | ) | — | |||||||
Restructuring related: | ||||||||||||
Severance and retention benefit (costs) | (412 | ) | 395 | (2,154 | ) | |||||||
Facility closure costs | — | — | (18 | ) | ||||||||
Assets impairment and other | — | — | (428 | ) | ||||||||
Other: | ||||||||||||
Compensation expense - deferred compensation plan | (105 | ) | (124 | ) | (98 | ) | ||||||
Stock-based compensation expense | (5,225 | ) | (5,380 | ) | (5,428 | ) | ||||||
Non-GAAP SG&A expenses | $ | 30,781 | $ | 27,227 | $ | 28,330 | ||||||
GAAP interest and other expense, net | $ | (3,915 | ) | $ | (2,153 | ) | $ | (2,496 | ) | |||
Non-cash interest expense | 3,892 | 3,393 | 3,268 | |||||||||
Gain on deferred compensation plan securities | (360 | ) | (474 | ) | (393 | ) | ||||||
Certain unrealized foreign exchange gain | (1,675 | ) | — | — | ||||||||
Non-GAAP interest and other income (expense), net | $ | (2,058 | ) | $ | 766 | $ | 379 | |||||
GAAP benefit from income taxes | $ | (982 | ) | $ | (2,448 | ) | $ | (3,558 | ) | |||
Non-GAAP tax adjustments | 3,341 | 2,942 | 4,540 | |||||||||
Non-GAAP provision for income taxes | $ | 2,359 | $ | 494 | $ | 982 | ||||||
(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) | |||||||||
July 2 | April 2 | ||||||||
(In thousands) | 2017 | 2017 | |||||||
ASSETS | |||||||||
Current assets: | |||||||||
Cash and cash equivalents | $ | 144,533 | $ | 214,554 | |||||
Short-term investments | 213,661 | 191,492 | |||||||
Accounts receivable, net | 103,433 | 89,312 | |||||||
Inventories | 71,371 | 52,288 | |||||||
Prepayments and other current assets | 14,157 | 13,054 | |||||||
Total current assets | 547,155 | 560,700 | |||||||
Property, plant and equipment, net | 84,696 | 80,961 | |||||||
Goodwill | 420,117 | 306,925 | |||||||
Intangible assets, net | 195,441 | 108,818 | |||||||
Deferred tax assets | 93,936 | 85,831 | |||||||
Other assets | 42,657 | 40,399 | |||||||
TOTAL ASSETS | $ | 1,384,002 | $ | 1,183,634 | |||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||
Current liabilities: | |||||||||
Accounts payable | $ | 41,266 | $ | 42,020 | |||||
Accrued compensation and related expenses | 23,552 | 26,624 | |||||||
Deferred income on shipments to distributors | 2,218 | 1,985 | |||||||
Current portion of bank loan | 2,000 | — | |||||||
Other accrued liabilities | 20,843 | 20,205 | |||||||
Total current liabilities | 89,879 | 90,834 | |||||||
Deferred tax liabilities | 12,160 | 13,835 | |||||||
Convertible notes | 288,978 | 285,542 | |||||||
Long-term bank loan, net | 191,957 | — | |||||||
Other long-term liabilities | 25,422 | 19,760 | |||||||
Total liabilities | 608,396 | 409,971 | |||||||
Stockholders' equity | 775,606 | 773,663 | |||||||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 1,384,002 | $ | 1,183,634 |