SLAB 8-K
Silicon Laboratories Inc. (SLAB)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Item 2.02. Results of Operations and Financial Condition
On October 27, 2021, Silicon Laboratories Inc. (“Silicon Laboratories”) issued a press release describing its results of operations for its fiscal quarter ended October 2, 2021. A copy of the press release is attached as Exhibit 99 to this report.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits.
| 99 | Press Release of Silicon Laboratories Inc. dated October 27, 2021 |
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
Use of Non-GAAP Financial Information
From time to time, Silicon Laboratories provides certain non-GAAP financial measures as additional information relating to its operating results. The non-GAAP financial measurements provided in the press release furnished herewith do not replace the presentation of Silicon Laboratories’ GAAP financial results. These additional measurements merely provide supplemental information to assist investors in analyzing Silicon Laboratories’ financial position and results of operations; however, these measures are not in accordance with, or an alternative to, GAAP and may be different from non-GAAP measures used by other companies.
Non-GAAP financial measures used by Silicon Laboratories include non-GAAP gross margin, non-GAAP research and development expense, non-GAAP selling, general and administrative expense, non-GAAP operating income, non-GAAP interest expense, non-GAAP tax expense, non-GAAP net income and non-GAAP diluted earnings per share. Silicon Laboratories has chosen to provide this information to investors because it believes that such supplemental information enables them to perform meaningful comparisons of past, present and future operating results, and as a means to highlight the results of core ongoing operations.
Non-GAAP financial measures are adjusted by the following items:
| · | Stock compensation expense – represents charges for employee stock awards issued under Silicon Laboratories’ stock-based compensation plans. Stock compensation expense is excluded from non-GAAP financial measures because it is a non-cash expense, and excluding such expense provides meaningful supplemental information regarding core ongoing operations. |
| · | Intangible asset amortization – primarily represents charges for the amortization of intangibles assets, such as core and developed technology, customer relationships and trademarks, acquired in connection with business combinations. Intangible asset amortization is excluded from non-GAAP financial measures because it is a non-cash expense, and excluding such expense provides meaningful supplemental information regarding core ongoing operations. |
| · | Acquisition and disposition related items – primarily including the following: charges for the fair value write-up associated with inventory acquired; adjustments to the fair value of acquisition-related contingent consideration; and acquisition-related costs of a business combination or disposition-related costs of a business divestiture, such as costs for attorneys, investment bankers, accountants and other third party service providers. Acquisition and disposition related items are excluded from non-GAAP financial measures because excluding such amounts provides meaningful supplemental information regarding core ongoing operations. |
| · | Termination costs, impairments and fair value adjustments – primarily include costs associated with certain employee terminations, asset impairments and fair value adjustments resulting from observable price changes. Termination costs, impairments and fair value adjustments are excluded from non-GAAP financial measures because excluding such amounts provides meaningful supplemental information regarding core ongoing operations. |
| · | Fair value adjustments to investments – primarily include gains and/or losses associated with certain fair value adjustments for equity investments accounted for by the equity method of accounting or cost minus impairment, if any, plus or minus changes resulting from qualifying observable price changes. Fair value adjustments are excluded from non-GAAP financial measures because these generally are non-cash, non-operating activity during the period of adjustment, relate to activity in entities outside those of Silicon Labs, and excluding such expense/gain provides meaningful supplemental information regarding core operations. |
| · | Interest expense adjustments – represents charges for the amortization of the debt discount on Silicon Laboratories’ convertible senior notes, losses on the extinguishment of convertible debt and losses on the termination of interest rate swap agreements. Such amounts are excluded from non-GAAP financial measures because they are non-cash expenses and/or excluding such amounts provides meaningful supplemental information regarding core ongoing operations. |
| · | Income tax adjustments – primarily include the following: the effect of the Tax Cuts & Jobs Act of 2017; the current and deferred income tax effects of the above non-GAAP adjustments; other indirect impacts of excluding stock-based compensation; and the income tax impact of certain intercompany license arrangements for technology acquired in business combinations. Income tax adjustments are excluded from non-GAAP financial measures because excluding such amounts provides meaningful supplemental information regarding core ongoing operations. |
Pursuant to the requirements of Regulation G, we have provided in the press release furnished with this report a reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial measures.
The information in this report, including the exhibit hereto, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. The information contained therein and in the accompanying exhibit shall not be incorporated by reference into any filing with the U.S. Securities and Exchange Commission made by Silicon Laboratories, whether made before or after the date hereof, regardless of any general incorporation language in such filing.
EXHIBIT INDEX
| Exhibit No. | Description | |
| 99 | Press Release of Silicon Laboratories Inc. dated October 27, 2021 | |
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
SIGNATURE
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 hereunto duly authorized.
| SILICON LABORATORIES INC. | ||
| October 27, 2021 | /s/ John C. Hollister | |
| Date | John C. Hollister Senior Vice President and Chief Financial Officer (Principal Financial Officer) |
Exhibit 99
Silicon Labs Announces Record IoT Revenue for Third Quarter 2021
IoT Leader Reports Accelerating Adoption Across Entire Wireless Portfolio
AUSTIN, Texas – October 27, 2021 – Silicon Labs (NASDAQ: SLAB), a leader in secure, intelligent wireless technology for a more connected world, reported strong financial results for the third quarter, which ended October 2, 2021. Revenue from continuing operations exceeded the top of the guidance range at $185 million, up 9% sequentially and 39% year-on-year.
“I'm really proud of what our team has accomplished,” said Silicon Labs President Matt Johnson. “We brought the industry together, delivered significant innovation and drove record revenue, all while navigating a uniquely challenging environment.”
“IoT solutions are being adopted at a rapid pace in large, diverse, and fast-growing home and industrial end markets,” said Silicon Labs CEO Tyson Tuttle. “Ten years ago, Silicon Labs set its sights on being a leader in IoT. I am confident in Matt’s ability to carry that vision forward, building on a strong foundation.”
During the third quarter, Silicon Labs completed the divestiture of its Infrastructure and Automotive (I&A) business to Skyworks Solutions, Inc. (NASDAQ: SWKS) for $2.75 billion in an all-cash transaction. Accordingly, all information included below is to be considered from continuing operations unless explicitly noted as “discontinued operations.”
Third Quarter Financial Highlights
| · | Revenue increased to $185 million, up 9% sequentially and 39% year-on-year |
Results on a GAAP basis:
| · | GAAP gross margin was 59.2% |
| · | GAAP R&D expenses were $73 million |
| · | GAAP SG&A expenses were $46 million |
| · | GAAP operating loss as a percentage of revenue was (5)% |
| · | GAAP diluted loss per share was $(0.45) |
Results on a non-GAAP basis, excluding the impact of stock compensation, amortization of acquired intangible assets, restructuring charges, non-cash interest expense and other costs associated with convertible notes, and certain other items as set forth in the reconciliation tables were as follows:
| · | Non-GAAP gross margin was 59.4% |
| · | Non-GAAP R&D expenses were $57 million |
| · | Non-GAAP SG&A expenses were $36 million |
| · | Non-GAAP operating income as a percentage of revenue was 9% |
| · | Non-GAAP diluted earnings per share were $0.34 |
Business Highlights
| · | After completing a smooth transition of the infrastructure and automotive business to Skyworks Solutions, Silicon Labs returned capital to shareholders through a “modified Dutch auction” tender offer. The tender offer was successfully completed on August 30th. |
| · | Concurrent with the sale of the I&A business, Silicon Labs initiated its CEO succession plan as Tyson Tuttle announced his intention to retire at the end of this year. Company President Matt Johnson will succeed Tyson as CEO on January 2nd, 2022. |
| · | Our annual WorksWith developers conference drew nearly eight thousand registrants, breaking last year’s record. Featured speakers included representatives from Amazon, Google, IKEA, Landis + Gyr, and Schneider Electric in virtual keynotes and hands-on technology sessions. |
| · | Announced new sub-GHz SoCs, delivering the world's first sub-GHz wireless solutions that combine long-range RF and energy efficiency with certified Arm PSA Level 3 security to meet the global demand for high-performance, battery-powered IoT products. |
| · | Announced the new Unify Software Development Kit (SDK), which provides the common building blocks for connectivity across IoT ecosystems that allow cloud and platform developers to design their devices and gateways with the confidence of “design once, support all” capability. The Unify SDK offers a bridge to Matter, an industry-unifying connectivity standard anticipated in Spring 2022. |
| · | Announced new Security Services, supporting IoT companies with the implementation of Zero Trust security architectures to meet emerging cybersecurity standards and combat the rising tide of threats. The new security offerings complement Silicon Labs' industry-leading Secure Vault™ technologies with a first-of-its-kind Custom Part Manufacturing Service (CPMS) for wireless SoCs and modules. |
Business Outlook
The company expects fourth quarter revenue to be in the range of $195 to $205 million. The company also estimates the following results:
On a GAAP basis:
| · | GAAP gross margin of approximately 59.0% |
| · | GAAP operating expenses of approximately $126 million |
| · | GAAP effective tax rate of approximately (14)% |
| · | GAAP diluted loss per share to be in the range of a $(0.41) to $(0.31) |
On a non-GAAP basis, excluding the impact of stock compensation, amortization of acquired intangible assets, restructuring charges, non-cash interest expense and other costs associated with convertible notes, and certain other items as set forth in the reconciliation tables:
| · | Non-GAAP gross margin of approximately 59.5% |
| · | Non-GAAP operating expenses of approximately $95 million |
| · | Non-GAAP effective tax rate of approximately 8% |
| · | Non-GAAP diluted earnings per share between $0.50 and $0.60 |
Share Repurchase Program
As of October 2, 2021, the company had repurchased $54 million under its $150 million repurchase program previously announced on May 19, 2021. In addition, on October 21, 2021, the Board of Directors authorized the repurchase of up to an incremental $400 million of the company’s common stock. In connection with this authorization, the company intends to enter into an accelerated share repurchase (ASR) agreement with an investment bank under which it will repurchase $400 million of its common stock on terms to be negotiated, subject to customary adjustments. The final settlement of the ASR is expected to be completed in the first quarter of 2022.
With the anticipated completion of the ASR, the previously executed “modified Dutch auction” tender offer, and open market stock repurchases completed year-to-date, the company will have returned approximately $1.1 billion of the proceeds from the divestiture of the infrastructure and automotive business. John Hollister, senior vice president and chief financial officer, said, “This accelerated share repurchase is the next step in our capital deployment program and demonstrates our continued commitment to deliver value to our shareholders through a prudent capital allocation strategy.”
Earnings Webcast and Conference Call
Silicon Labs will host an earnings conference call to discuss the quarterly results and answer questions at 7:30 am CDT today. An audio webcast will be available on Silicon Labs' website (www.silabs.com) under Investor Relations. The company will post an audio recording of the event at silabs.com/investors and make a replay available through November 24, 2021, online or by calling (877) 344-7529 (US) or (412) 317-0088 (international) and entering access code 10160443.
About Silicon Labs
Silicon Labs (NASDAQ: SLAB) is a leader in secure, intelligent wireless technology for a more connected world. Our integrated hardware and software platform, intuitive development tools, thriving ecosystem and robust support make us an ideal long-term partner in building advanced industrial, commercial, home and life applications. We make it easy for developers to solve complex wireless challenges throughout the product lifecycle and get to market quickly with innovative solutions that transform industries, grow economies, and improve lives. silabs.com
Forward-Looking Statements
This press release contains forward-looking statements based on Silicon Labs’ current expectations. The words "believe," "estimate," "expect," "intend," "anticipate," "plan," "project," "will" and similar phrases as they relate to Silicon Labs are intended to identify such forward-looking statements. These forward-looking statements reflect the current views and assumptions of Silicon Labs and are subject to various risks and uncertainties that could cause actual results to differ materially from expectations. Among the factors that could cause actual results to differ materially from those in the forward-looking statements are the following: the effect of the Skyworks transaction on the ability of Silicon Labs to retain and hire key personnel and maintain relationships with its customers, suppliers, advertisers, partners and others with whom it does business, or on its operating results and businesses generally; risks associated with the disruption of management’s attention from ongoing business operations due to such transaction; the timing and scope of anticipated share repurchases, including the anticipated ASR transaction, and/or dividends; the impact of COVID-19 on the U.S. and global economy, including the restrictions on travel and transportation and other actions taken by governmental authorities and disruptions to the business of our customers or our global supply chain that have occurred or may occur in the future, the ongoing impact of COVID-19 on our employees and our ability to provide services to our customers and respond to their needs; risks that Silicon Labs may not be able to maintain its historical growth; quarterly fluctuations in revenues and operating results; difficulties developing new products that achieve market acceptance; risks associated with international activities (including trade barriers, particularly with respect to China); intellectual property litigation risks; risks associated with acquisitions and divestitures; product liability risks; difficulties managing and/or obtaining sufficient supply from Silicon Labs’ distributors, manufacturers and subcontractors; dependence on a limited number of products; absence of long-term commitments from customers; inventory-related risks; difficulties managing international activities; risks that Silicon Labs may not be able to manage strains associated with its growth; credit risks associated with its accounts receivable; dependence on key personnel; stock price volatility; geographic concentration of manufacturers, assemblers, test service providers and customers in Asia that subjects Silicon Labs’ business and results of operations to risks of natural disasters, epidemics or pandemics, war and political unrest; debt-related risks; capital-raising risks; the competitive and cyclical nature of the semiconductor industry; average selling prices of products may decrease significantly and rapidly; information technology risks; cyber-attacks against Silicon Labs’ products and its networks and other factors that are detailed in the SEC filings of Silicon Laboratories Inc. The level of share repurchases and/or dividends depends on market conditions and the level of other uses of cash. Silicon Labs disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. References in this press release to Silicon Labs shall mean Silicon Laboratories Inc.
Note to editors: Silicon Laboratories, Silicon Labs, the “S” symbol, and the Silicon Labs logo are trademarks of Silicon Laboratories Inc. All other product names noted herein may be trademarks of their respective holders.
CONTACT: Austin Dean, Investor Relations Manager, +1 (512) 532-9432, [email protected]
Silicon Laboratories Inc.
Condensed Consolidated Statements of Income
(In thousands, except per share data)
(Unaudited)
| Three Months Ended | Nine Months Ended | |||||||||||||||
| October 2, 2021 | October 3, 2020 | October 2, 2021 | October 3, 2020 | |||||||||||||
| Revenues | $ | 184,831 | $ | 132,731 | $ | 512,180 | $ | 365,099 | ||||||||
| Cost of revenues | 75,322 | 57,247 | 214,619 | 154,189 | ||||||||||||
| Gross profit | 109,509 | 75,484 | 297,561 | 210,910 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Research and development | 72,656 | 58,929 | 201,503 | 174,631 | ||||||||||||
| Selling, general and administrative | 46,128 | 40,154 | 131,535 | 124,956 | ||||||||||||
| Operating expenses | 118,784 | 99,083 | 333,038 | 299,587 | ||||||||||||
| Operating loss | (9,275 | ) | (23,599 | ) | (35,477 | ) | (88,677 | ) | ||||||||
| Other income (expense): | ||||||||||||||||
| Interest income and other, net | 5,516 | 2,044 | 9,038 | 8,562 | ||||||||||||
| Interest expense | (6,595 | ) | (8,604 | ) | (24,405 | ) | (25,923 | ) | ||||||||
| Loss from continuing operations before income taxes | (10,354 | ) | (30,159 | ) | (50,844 | ) | (106,038 | ) | ||||||||
| Provision (benefit) for income taxes | 9,386 | (3,457 | ) | 12,543 | (11,900 | ) | ||||||||||
| Loss from continuing operations | (19,740 | ) | (26,702 | ) | (63,387 | ) | (94,138 | ) | ||||||||
| Income from discontinued operations, net of income taxes | 2,106,796 | 29,864 | 2,183,884 | 97,721 | ||||||||||||
| Net income | $ | 2,087,056 | $ | 3,162 | $ | 2,120,497 | $ | 3,583 | ||||||||
| Basic earnings (loss) per share: | ||||||||||||||||
| Continuing operations | $ | (0.45 | ) | $ | (0.61 | ) | $ | (1.44 | ) | $ | (2.15 | ) | ||||
| Net income | $ | 48.11 | $ | 0.07 | $ | 48.08 | $ | 0.08 | ||||||||
| Diluted earnings (loss) per share: | ||||||||||||||||
| Continuing operations | $ | (0.45 | ) | $ | (0.61 | ) | $ | (1.44 | ) | $ | (2.15 | ) | ||||
| Net income | $ | 46.76 | $ | 0.07 | $ | 46.71 | $ | 0.08 | ||||||||
| Weighted-average common shares outstanding: | ||||||||||||||||
| Basic | 43,385 | 43,815 | 44,103 | 43,737 | ||||||||||||
| Diluted | 44,634 | 44,328 | 45,394 | 44,254 | ||||||||||||
Silicon Laboratories Inc.
Condensed Consolidated Balance Sheets
(In thousands, except per share data)
(Unaudited)
| October 2, 2021 | January 2, 2021 | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 1,362,412 | $ | 202,720 | ||||
| Short-term investments | 1,364,095 | 521,963 | ||||||
| Accounts receivable, net | 72,596 | 95,169 | ||||||
| Inventories | 59,114 | 47,861 | ||||||
| Prepaid expenses and other current assets | 61,936 | 87,103 | ||||||
| Current assets of discontinued operations | -- | 21,005 | ||||||
| Total current assets | 2,920,153 | 975,821 | ||||||
| Property and equipment, net | 143,340 | 135,803 | ||||||
| Goodwill | 376,389 | 376,389 | ||||||
| Other intangible assets, net | 129,512 | 163,483 | ||||||
| Other assets, net | 70,108 | 76,675 | ||||||
| Non-current assets of discontinued operations | -- | 265,316 | ||||||
| Total assets | $ | 3,639,502 | $ | 1,993,487 | ||||
| Liabilities and Stockholders’ Equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 57,975 | $ | 54,949 | ||||
| Current portion of convertible debt, net | -- | 134,480 | ||||||
| Deferred revenue and returns liability | 11,329 | 12,986 | ||||||
| Other current liabilities | 389,071 | 81,650 | ||||||
| Current liabilities of discontinued operations | -- | 433 | ||||||
| Total current liabilities | 458,375 | 284,498 | ||||||
| Convertible debt, net | 445,110 | 428,945 | ||||||
| Other non-current liabilities | 88,434 | 79,752 | ||||||
| Non-current liabilities of discontinued operations | -- | 451 | ||||||
| Total liabilities | 991,919 | 793,646 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders’ equity: | ||||||||
| Preferred stock – $0.0001 par value; 10,000 shares authorized; no shares issued | -- | -- | ||||||
| Common stock – $0.0001 par value; 250,000 shares authorized; 40,547 and 43,925 shares issued and outstanding at October 2, 2021 and January 2, 2021, respectively | 4 | 4 | ||||||
| Additional paid-in capital | -- | 204,359 | ||||||
| Retained earnings | 2,648,190 | 993,664 | ||||||
| Accumulated other comprehensive income (loss) | (611 | ) | 1,814 | |||||
| Total stockholders' equity | 2,647,583 | 1,199,841 | ||||||
| Total liabilities and stockholders' equity | $ | 3,639,502 | $ | 1,993,487 | ||||
Silicon Laboratories Inc.
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
| Nine Months Ended | ||||||||
| October 2, 2021 | October 3, 2020 | |||||||
| Operating Activities | ||||||||
| Net income | $ | 2,120,497 | $ | 3,583 | ||||
| Adjustments to reconcile net income to cash provided by operating activities of continuing operations: | ||||||||
| Income from discontinued operations, net of income taxes | (2,183,884 | ) | (97,721 | ) | ||||
| Depreciation of property and equipment | 12,925 | 11,789 | ||||||
| Amortization of intangible assets and other assets | 33,971 | 31,118 | ||||||
| Amortization of debt discount and debt issuance costs | 17,278 | 14,946 | ||||||
| Loss on extinguishment of convertible debt | 3,370 | 3,977 | ||||||
| Stock-based compensation expense | 36,916 | 36,252 | ||||||
| Deferred income taxes | (3,132 | ) | (7,382 | ) | ||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | 22,573 | (2,902 | ) | |||||
| Inventories | (11,320 | ) | 12,499 | |||||
| Prepaid expenses and other assets | 27,598 | (5,602 | ) | |||||
| Accounts payable | (4,522 | ) | 6,103 | |||||
| Other current liabilities and income taxes | (10,981 | ) | 3,608 | |||||
| Deferred revenue and returns liability | (1,657 | ) | 2,643 | |||||
| Other non-current liabilities | (11,388 | ) | 7,525 | |||||
| Net cash provided by operating activities of continuing operations | 48,244 | 20,436 | ||||||
| Investing Activities | ||||||||
| Purchases of marketable securities | (1,212,572 | ) | (418,227 | ) | ||||
| Sales and maturities of marketable securities | 368,416 | 427,235 | ||||||
| Purchases of property and equipment | (19,468 | ) | (13,589 | ) | ||||
| Purchases of other assets | (578 | ) | (920 | ) | ||||
| Acquisition of business, net of cash acquired | -- | (316,809 | ) | |||||
| Net cash used in investing activities of continuing operations | (864,202 | ) | (322,310 | ) | ||||
| Financing Activities | ||||||||
| Proceeds from issuance of debt | -- | 845,000 | ||||||
| Payments on debt | (140,572 | ) | (618,729 | ) | ||||
| Repurchases of common stock | (688,373 | ) | (16,287 | ) | ||||
| Payment of taxes withheld for vested stock awards | (21,393 | ) | (17,562 | ) | ||||
| Proceeds from the issuance of common stock | 8,619 | 8,155 | ||||||
| Net cash provided by (used in) financing activities of continuing operations | (841,719 | ) | 200,577 | |||||
| Discontinued Operations | ||||||||
| Operating activities | 69,685 | 106,527 | ||||||
| Investing activities | 2,747,684 | (2,018 | ) | |||||
| Net cash provided by discontinued operations | 2,817,369 | 104,509 | ||||||
| Increase in cash and cash equivalents | 1,159,692 | 3,212 | ||||||
| Cash and cash equivalents at beginning of period | 202,720 | 227,146 | ||||||
| Cash and cash equivalents at end of period | $ | 1,362,412 | $ | 230,358 | ||||
Non-GAAP Financial Measurements
In addition to the GAAP results provided throughout this document, Silicon Labs has provided non-GAAP financial measurements on a basis excluding non-cash and other charges and benefits. Details of these excluded items are presented in the tables below, which reconcile the GAAP results to non-GAAP financial measurements.
The non-GAAP financial measurements do not replace the presentation of Silicon Labs’ GAAP financial results. These measurements provide supplemental information to assist management and investors in analyzing Silicon Labs’ financial position and results of operations. Silicon Labs has chosen to provide this information to investors to enable them to perform meaningful comparisons of past, present and future operating results and as a means to emphasize the results of core on-going operations.
Unaudited Reconciliation of GAAP to Non-GAAP Financial Measures
(In thousands, except per share data)
| Non-GAAP Income Statement Items | Three Months Ended October 2, 2021 | |||||||||||||||||||||||||||
GAAP Measure | GAAP Percent
of | Stock Compensation | Intangible Asset Amortization | Termination Costs | Non-GAAP Measure | Non-GAAP Percent
of | ||||||||||||||||||||||
| Revenues | $ | 184,831 | ||||||||||||||||||||||||||
| Gross profit | 109,509 | 59.2 | % | $ | 260 | $ | -- | $ | -- | $ | 109,769 | 59.4 | % | |||||||||||||||
| Research and development | 72,656 | 39.3 | % | 7,072 | 8,198 | -- | 57,386 | 31.0 | % | |||||||||||||||||||
| Selling, general and administrative | 46,128 | 24.9 | % | 6,963 | 2,871 | 626 | 35,668 | 19.3 | % | |||||||||||||||||||
| Operating income (loss) | (9,275 | ) | (5.0 | )% | 14,295 | 11,069 | 626 | 16,715 | 9.0 | % | ||||||||||||||||||
| Non-GAAP Earnings Per Share – Continuing Operations | Three Months Ended October 2, 2021 | |||||||||||||||||||||||||||||||
GAAP Measure | Stock Compensation Expense* | Intangible Asset Amortization* |
Termination | Investment Fair Value Adjustments* | Interest Expense Adjustments* | Income Tax Adjustments | Non- GAAP Measure | |||||||||||||||||||||||||
| Income (loss) from continuing operations | $ | (19,740 | ) | $ | 14,295 | $ | 11,069 | $ | 626 | $ | (4,100 | ) | $ | 5,076 | $ | 8,121 | $ | 15,347 | ||||||||||||||
| Dilutive Securities Excluded From GAAP Measure Due to Net Loss | ||||||||||||||||||||||||||||||||
| Diluted shares outstanding | 43,385 | 1,249 | 44,634 | |||||||||||||||||||||||||||||
| Diluted earnings (loss) per share | $ | (0.45 | ) | $ | 0.34 | |||||||||||||||||||||||||||
Unaudited Forward-Looking Statements Regarding Business Outlook**
(In millions, except per share data)
| Business Outlook | Three Months Ending January 1, 2022 | |||||||||||
GAAP | Non-GAAP Adjustments* | Non-GAAP Measure | ||||||||||
| Gross margin | 59 | % | 0.5 | % | 59.5 | % | ||||||
| Operating expenses | $ | 126 | $ | 31 | $ | 95 | ||||||
| Effective tax rate | (14 | )% | 22 | % | 8 | % | ||||||
| Diluted earnings (loss) per share - low | $ | (0.41 | ) | $ | 0.91 | $ | 0.50 | |||||
| Diluted earnings (loss) per share - high | $ | (0.31 | ) | $ | 0.91 | $ | 0.60 | |||||
** Non-GAAP adjustments include the following estimates: stock compensation expense of $20 million, intangible asset amortization of $11 million, interest expense adjustments of $5 million, termination costs of $1 million and the associated tax impact from the aforementioned items.