|
Delaware
|
04-2302115
|
(State or other jurisdiction of
incorporation or organization)
|
(I.R.S. Employer Identification No.)
|
20 Sylvan Road, Woburn, Massachusetts
|
01801
|
(Address of principal executive offices)
|
(Zip Code)
|
|
|
Registrant’s telephone number, including area code:
(781) 376-3000
|
Large Accelerated filer
þ
|
Accelerated filer
¨
|
Non-accelerated filer
¨
|
Smaller reporting company
¨
|
Emerging growth company
¨
|
Class
|
|
Outstanding as of January 30, 2019
|
||
Common Stock, par value $.25 per share
|
|
|
174,064,672
|
|
|
PAGE NO.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
||||||
|
December 28,
2018 |
|
December 29,
2017 |
||||
Net revenue
|
$
|
972.0
|
|
|
$
|
1,051.9
|
|
Cost of goods sold
|
486.9
|
|
|
515.1
|
|
||
Gross profit
|
485.1
|
|
|
536.8
|
|
||
Operating expenses:
|
|
|
|
|
|
||
Research and development
|
109.2
|
|
|
98.0
|
|
||
Selling, general and administrative
|
47.8
|
|
|
51.3
|
|
||
Amortization of intangibles
|
7.4
|
|
|
4.0
|
|
||
Restructuring and other charges (benefits)
|
(0.2
|
)
|
|
—
|
|
||
Total operating expenses
|
164.2
|
|
|
153.3
|
|
||
Operating income
|
320.9
|
|
|
383.5
|
|
||
Other income, net
|
2.9
|
|
|
2.1
|
|
||
Income before income taxes
|
323.8
|
|
|
385.6
|
|
||
Provision for income taxes
|
38.9
|
|
|
315.2
|
|
||
Net income
|
$
|
284.9
|
|
|
$
|
70.4
|
|
Earnings per share:
|
|
|
|
|
|
||
Basic
|
$
|
1.61
|
|
|
$
|
0.38
|
|
Diluted
|
$
|
1.60
|
|
|
$
|
0.38
|
|
Weighted average shares:
|
|
|
|
||||
Basic
|
176.6
|
|
|
183.1
|
|
||
Diluted
|
177.7
|
|
|
185.5
|
|
||
|
|
|
|
||||
Cash dividends declared and paid per share
|
$
|
0.38
|
|
|
$
|
0.32
|
|
|
Three Months Ended
|
||||||
|
December 28,
2018 |
|
December 29,
2017 |
||||
Net income
|
$
|
284.9
|
|
|
$
|
70.4
|
|
Other comprehensive income
|
|
|
|
||||
Fair value of investments
|
0.1
|
|
|
—
|
|
||
Comprehensive income
|
$
|
285.0
|
|
|
$
|
70.4
|
|
|
As of
|
||||||
|
December 28,
2018 |
|
September 28,
2018 |
||||
ASSETS
|
(unaudited)
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
1,085.7
|
|
|
$
|
733.3
|
|
Marketable securities
|
13.4
|
|
|
294.1
|
|
||
Receivables, net of allowance for doubtful accounts of $0.7 and $0.6, respectively
|
524.4
|
|
|
655.8
|
|
||
Inventory
|
493.1
|
|
|
490.2
|
|
||
Other current assets
|
91.9
|
|
|
88.8
|
|
||
Total current assets
|
2,208.5
|
|
|
2,262.2
|
|
||
Property, plant and equipment, net
|
1,140.6
|
|
|
1,140.9
|
|
||
Goodwill
|
1,189.8
|
|
|
1,189.8
|
|
||
Intangible assets, net
|
130.1
|
|
|
143.7
|
|
||
Deferred tax assets, net
|
34.7
|
|
|
36.5
|
|
||
Marketable securities
|
2.7
|
|
|
22.8
|
|
||
Other assets
|
32.5
|
|
|
33.0
|
|
||
Total assets
|
$
|
4,738.9
|
|
|
$
|
4,828.9
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
||
Current liabilities:
|
|
|
|
|
|
||
Accounts payable
|
$
|
156.5
|
|
|
$
|
229.9
|
|
Accrued compensation and benefits
|
70.8
|
|
|
85.2
|
|
||
Other current liabilities
|
130.0
|
|
|
74.6
|
|
||
Total current liabilities
|
357.3
|
|
|
389.7
|
|
||
Long-term tax liabilities
|
313.5
|
|
|
310.5
|
|
||
Other long-term liabilities
|
29.8
|
|
|
31.7
|
|
||
Total liabilities
|
700.6
|
|
|
731.9
|
|
||
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; 229.3 shares issued and 174.1 shares outstanding at December 28, 2018, and 228.4 shares issued and 177.4 shares outstanding at September 28, 2018
|
43.5
|
|
|
44.4
|
|
||
Additional paid-in capital
|
3,088.4
|
|
|
3,061.0
|
|
||
Treasury stock, at cost
|
(3,036.1
|
)
|
|
(2,732.5
|
)
|
||
Retained earnings
|
3,950.7
|
|
|
3,732.9
|
|
||
Accumulated other comprehensive loss
|
(8.2
|
)
|
|
(8.8
|
)
|
||
Total stockholders’ equity
|
4,038.3
|
|
|
4,097.0
|
|
||
Total liabilities and stockholders’ equity
|
$
|
4,738.9
|
|
|
$
|
4,828.9
|
|
|
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 September 28, 2018
|
177.4
|
|
|
$
|
44.4
|
|
|
51.0
|
|
|
$
|
(2,732.5
|
)
|
|
$
|
3,061.0
|
|
|
$
|
3,732.9
|
|
|
$
|
(8.8
|
)
|
|
$
|
4,097.0
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
284.9
|
|
|
—
|
|
|
284.9
|
|
||||||
Exercise and settlement of share based awards and related tax benefit, net of shares withheld for taxes
|
0.7
|
|
|
0.1
|
|
|
0.2
|
|
|
(19.6
|
)
|
|
5.1
|
|
|
—
|
|
|
—
|
|
|
(14.4
|
)
|
||||||
Share-based compensation expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
21.3
|
|
|
—
|
|
|
—
|
|
|
21.3
|
|
||||||
Share repurchase program
|
(4.0
|
)
|
|
(1.0
|
)
|
|
4.0
|
|
|
(284.0
|
)
|
|
1.0
|
|
|
—
|
|
|
—
|
|
|
(284.0
|
)
|
||||||
Dividends declared
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(67.1
|
)
|
|
—
|
|
|
(67.1
|
)
|
||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.6
|
|
|
0.6
|
|
||||||
Balance at December 28, 2018
|
174.1
|
|
|
$
|
43.5
|
|
|
55.2
|
|
|
$
|
(3,036.1
|
)
|
|
$
|
3,088.4
|
|
|
$
|
3,950.7
|
|
|
$
|
(8.2
|
)
|
|
$
|
4,038.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance at September 29, 2017
|
183.1
|
|
|
$
|
45.8
|
|
|
42.9
|
|
|
$
|
(1,925.0
|
)
|
|
$
|
2,893.8
|
|
|
$
|
3,059.6
|
|
|
$
|
(8.5
|
)
|
|
$
|
4,065.7
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
70.4
|
|
|
—
|
|
|
70.4
|
|
||||||
Exercise and settlement of share based awards and related tax benefit, net of shares withheld for taxes
|
0.9
|
|
|
0.2
|
|
|
0.4
|
|
|
(44.7
|
)
|
|
14.7
|
|
|
—
|
|
|
—
|
|
|
(29.8
|
)
|
||||||
Share-based compensation expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
27.4
|
|
|
(1.9
|
)
|
|
—
|
|
|
25.5
|
|
||||||
Share repurchase program
|
(1.6
|
)
|
|
(0.4
|
)
|
|
1.6
|
|
|
(172.5
|
)
|
|
0.4
|
|
|
—
|
|
|
—
|
|
|
(172.5
|
)
|
||||||
Dividends declared
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(58.8
|
)
|
|
—
|
|
|
(58.8
|
)
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Balance at December 29, 2017
|
182.4
|
|
|
$
|
45.6
|
|
|
44.9
|
|
|
$
|
(2,142.2
|
)
|
|
$
|
2,936.3
|
|
|
$
|
3,069.3
|
|
|
$
|
(8.5
|
)
|
|
$
|
3,900.5
|
|
|
Three Months Ended
|
||||||
|
December 28,
2018 |
|
December 29,
2017 |
||||
Cash flows from operating activities:
|
|
|
|
||||
Net income
|
$
|
284.9
|
|
|
$
|
70.4
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Share-based compensation
|
20.8
|
|
|
25.8
|
|
||
Depreciation
|
77.5
|
|
|
63.6
|
|
||
Amortization of intangible assets, including inventory step-up
|
15.5
|
|
|
5.5
|
|
||
Deferred income taxes
|
1.8
|
|
|
21.4
|
|
||
Other, net
|
1.0
|
|
|
—
|
|
||
Changes in assets and liabilities:
|
|
|
|
|
|
||
Receivables, net
|
131.4
|
|
|
(4.1
|
)
|
||
Inventory
|
(5.0
|
)
|
|
34.5
|
|
||
Other current and long-term assets
|
(2.6
|
)
|
|
(20.6
|
)
|
||
Accounts payable
|
(22.2
|
)
|
|
(105.4
|
)
|
||
Other current and long-term liabilities
|
45.9
|
|
|
269.7
|
|
||
Net cash provided by operating activities
|
549.0
|
|
|
360.8
|
|
||
Cash flows from investing activities:
|
|
|
|
||||
Capital expenditures
|
(129.5
|
)
|
|
(28.2
|
)
|
||
Purchased intangibles
|
—
|
|
|
(6.0
|
)
|
||
Purchases of marketable securities
|
(2.2
|
)
|
|
—
|
|
||
Sales and maturities of marketable securities
|
303.2
|
|
|
—
|
|
||
Net cash provided by (used in) investing activities
|
171.5
|
|
|
(34.2
|
)
|
||
Cash flows from financing activities:
|
|
|
|
||||
Repurchase of common stock - payroll tax withholdings on equity awards
|
(19.4
|
)
|
|
(44.7
|
)
|
||
Repurchase of common stock - stock repurchase program
|
(284.0
|
)
|
|
(172.5
|
)
|
||
Dividends paid
|
(67.1
|
)
|
|
(59.1
|
)
|
||
Net proceeds from exercise of stock options
|
2.4
|
|
|
14.4
|
|
||
Net cash used in financing activities
|
(368.1
|
)
|
|
(261.9
|
)
|
||
Net increase in cash and cash equivalents
|
352.4
|
|
|
64.7
|
|
||
Cash and cash equivalents at beginning of period
|
733.3
|
|
|
1,616.8
|
|
||
Cash and cash equivalents at end of period
|
$
|
1,085.7
|
|
|
$
|
1,681.5
|
|
Supplemental cash flow disclosures:
|
|
|
|
||||
Income taxes paid
|
$
|
1.6
|
|
|
$
|
7.2
|
|
|
Three Months Ended
|
||||||
|
December 28,
2018 |
|
December 29,
2017 |
||||
United States
|
$
|
600.1
|
|
|
$
|
626.8
|
|
China
|
194.5
|
|
|
199.6
|
|
||
South Korea
|
99.1
|
|
|
118.3
|
|
||
Taiwan
|
40.7
|
|
|
72.3
|
|
||
Europe, Middle East and Africa
|
32.7
|
|
|
29.4
|
|
||
Other Asia-Pacific
|
4.9
|
|
|
5.5
|
|
||
Total
|
$
|
972.0
|
|
|
$
|
1,051.9
|
|
|
Current
|
|
Noncurrent
|
||||||||||||
Available for sale:
|
December 28,
2018 |
|
September 28,
2018 |
|
December 28,
2018 |
|
September 28,
2018 |
||||||||
U.S. Treasury and government
|
$
|
7.9
|
|
|
$
|
65.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Corporate bonds and notes
|
1.4
|
|
|
204.1
|
|
|
—
|
|
|
12.0
|
|
||||
Municipal bonds
|
2.2
|
|
|
2.0
|
|
|
2.7
|
|
|
0.8
|
|
||||
Other government
|
1.9
|
|
|
23.0
|
|
|
—
|
|
|
10.0
|
|
||||
Total
|
$
|
13.4
|
|
|
$
|
294.1
|
|
|
$
|
2.7
|
|
|
$
|
22.8
|
|
•
|
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.
|
|
As of December 28, 2018
|
|
As of September 28, 2018
|
||||||||||||||||||||||||||||
|
|
|
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*
|
$
|
1,085.7
|
|
|
$
|
1,084.7
|
|
|
$
|
1.0
|
|
|
$
|
—
|
|
|
$
|
79.3
|
|
|
$
|
29.7
|
|
|
$
|
49.6
|
|
|
$
|
—
|
|
U.S. Treasury and government securities
|
8.0
|
|
|
—
|
|
|
8.0
|
|
|
—
|
|
|
65.0
|
|
|
15.0
|
|
|
50.0
|
|
|
—
|
|
||||||||
Corporate bonds and notes
|
1.4
|
|
|
—
|
|
|
1.4
|
|
|
—
|
|
|
216.0
|
|
|
—
|
|
|
216.0
|
|
|
—
|
|
||||||||
Municipal bonds
|
4.8
|
|
|
—
|
|
|
4.8
|
|
|
—
|
|
|
2.8
|
|
|
—
|
|
|
2.8
|
|
|
—
|
|
||||||||
Other government securities
|
1.9
|
|
|
—
|
|
|
1.9
|
|
|
—
|
|
|
33.1
|
|
|
—
|
|
|
33.1
|
|
|
—
|
|
||||||||
Total
|
$
|
1,101.8
|
|
|
$
|
1,084.7
|
|
|
$
|
17.1
|
|
|
$
|
—
|
|
|
$
|
396.2
|
|
|
$
|
44.7
|
|
|
$
|
351.5
|
|
|
$
|
—
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Contingent consideration
|
$
|
3.1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3.1
|
|
|
$
|
3.1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3.1
|
|
Total
|
$
|
3.1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3.1
|
|
|
$
|
3.1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3.1
|
|
|
As of
|
||||||
|
December 28,
2018 |
|
September 28,
2018 |
||||
Raw materials
|
$
|
21.5
|
|
|
$
|
20.2
|
|
Work-in-process
|
301.5
|
|
|
340.7
|
|
||
Finished goods
|
162.5
|
|
|
124.8
|
|
||
Finished goods held on consignment by customers
|
7.6
|
|
|
4.5
|
|
||
Total inventory
|
$
|
493.1
|
|
|
$
|
490.2
|
|
|
As of
|
||||||
|
December 28,
2018 |
|
September 28,
2018 |
||||
Land and improvements
|
$
|
11.7
|
|
|
$
|
11.6
|
|
Buildings and improvements
|
258.7
|
|
|
238.0
|
|
||
Furniture and fixtures
|
31.8
|
|
|
31.5
|
|
||
Machinery and equipment
|
2,151.6
|
|
|
2,089.6
|
|
||
Construction in progress
|
163.3
|
|
|
179.0
|
|
||
Total property, plant and equipment, gross
|
2,617.1
|
|
|
2,549.7
|
|
||
Accumulated depreciation
|
(1,476.5
|
)
|
|
(1,408.8
|
)
|
||
Total property, plant and equipment, net
|
$
|
1,140.6
|
|
|
$
|
1,140.9
|
|
|
|
As of
|
|
As of
|
||||||||||||||||||||
|
Weighted Average Amortization Period (Years) |
December 28, 2018
|
|
September 28, 2018
|
||||||||||||||||||||
|
Gross
Carrying Amount |
|
Accumulated Amortization |
|
Net
Carrying Amount |
|
Gross
Carrying Amount |
|
Accumulated Amortization |
|
Net
Carrying Amount |
|||||||||||||
Customer relationships
|
3.7
|
$
|
28.7
|
|
|
$
|
(14.9
|
)
|
|
$
|
13.8
|
|
|
31.7
|
|
|
(13.2
|
)
|
|
18.5
|
|
|||
Developed technology and other
|
5.3
|
89.9
|
|
|
(30.8
|
)
|
|
59.1
|
|
|
89.9
|
|
|
(23.5
|
)
|
|
66.4
|
|
||||||
Trademarks
|
3.0
|
1.6
|
|
|
(0.9
|
)
|
|
0.7
|
|
|
1.6
|
|
|
(0.8
|
)
|
|
0.8
|
|
||||||
Capitalized software
|
3.0
|
18.0
|
|
|
(7.5
|
)
|
|
10.5
|
|
|
18.0
|
|
|
(6.0
|
)
|
|
12.0
|
|
||||||
IPR&D
|
|
46.0
|
|
|
—
|
|
|
46.0
|
|
|
46.0
|
|
|
—
|
|
|
46.0
|
|
||||||
Total intangible assets
|
|
$
|
184.2
|
|
|
$
|
(54.1
|
)
|
|
$
|
130.1
|
|
|
$
|
187.2
|
|
|
$
|
(43.5
|
)
|
|
$
|
143.7
|
|
|
Remaining 2019
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
Thereafter
|
||||||||||||
Amortization expense, cost of goods sold
|
$
|
18.1
|
|
|
$
|
21.9
|
|
|
$
|
0.1
|
|
|
$
|
0.1
|
|
|
$
|
0.1
|
|
|
$
|
1.9
|
|
Amortization expense, operating expense
|
15.7
|
|
|
12.4
|
|
|
9.0
|
|
|
1.0
|
|
|
1.0
|
|
|
2.8
|
|
||||||
Total amortization expense
|
$
|
33.8
|
|
|
$
|
34.3
|
|
|
$
|
9.1
|
|
|
$
|
1.1
|
|
|
$
|
1.1
|
|
|
$
|
4.7
|
|
|
Three Months Ended
|
||||||
|
December 28,
2018 |
|
December 29,
2017 |
||||
United States income taxes
|
$
|
29.5
|
|
|
$
|
304.9
|
|
Foreign income taxes
|
9.4
|
|
|
10.3
|
|
||
Provision for income taxes
|
$
|
38.9
|
|
|
$
|
315.2
|
|
|
|
|
|
||||
Effective tax rate
|
12.0
|
%
|
|
81.7
|
%
|
|
Three Months Ended
|
||||||
|
December 28,
2018 |
|
December 29,
2017 |
||||
Cost of goods sold
|
$
|
3.6
|
|
|
$
|
4.1
|
|
Research and development
|
12.5
|
|
|
11.2
|
|
||
Selling, general and administrative
|
4.7
|
|
|
10.5
|
|
||
Total share-based compensation
|
$
|
20.8
|
|
|
$
|
25.8
|
|
|
Three Months Ended
|
||||||
|
December 28,
2018 |
|
December 29,
2017 |
||||
Net income
|
$
|
284.9
|
|
|
$
|
70.4
|
|
|
|
|
|
||||
Weighted average shares outstanding – basic
|
176.6
|
|
|
183.1
|
|
||
Dilutive effect of equity based awards
|
1.1
|
|
|
2.4
|
|
||
Weighted average shares outstanding – diluted
|
177.7
|
|
|
185.5
|
|
||
|
|
|
|
||||
Net income per share – basic
|
$
|
1.61
|
|
|
$
|
0.38
|
|
Net income per share – diluted
|
$
|
1.60
|
|
|
$
|
0.38
|
|
|
|
|
|
||||
Anti-dilutive common stock equivalents
|
1.7
|
|
|
0.4
|
|
|
Three Months Ended
|
||||
|
December 28,
2018 |
|
December 29,
2017 |
||
Net revenue
|
100.0
|
%
|
|
100.0
|
%
|
Cost of goods sold
|
50.1
|
|
|
49.0
|
|
Gross profit
|
49.9
|
|
|
51.0
|
|
Operating expenses:
|
|
|
|
|
|
Research and development
|
11.2
|
|
|
9.3
|
|
Selling, general and administrative
|
4.9
|
|
|
4.9
|
|
Amortization of intangibles
|
0.8
|
|
|
0.4
|
|
Total operating expenses
|
16.9
|
|
|
14.6
|
|
Operating income
|
33.0
|
|
|
36.4
|
|
Other income, net
|
0.3
|
|
|
0.2
|
|
Income before income taxes
|
33.3
|
|
|
36.6
|
|
Provision for income taxes
|
4.0
|
|
|
30.0
|
|
Net income
|
29.3
|
%
|
|
6.6
|
%
|
•
|
Net revenue
decreased
by
7.6%
to $
972.0 million
for the
three months ended
December 28, 2018
, as compared with the corresponding period in fiscal 2018. This decrease in revenue was primarily driven by weakness in smartphone demand, partially offset by increasing radio frequency (“RF”) content per smartphone.
|
•
|
Our ending cash, cash equivalents and marketable securities balance increased approximately
4.9%
to $
1,101.8 million
as of
December 28, 2018
, from
$1,050.2 million
as of September 28, 2018. This increase in cash, cash equivalents and marketable securities was primarily the result of cash generated from operations of $
549.0 million
, partially offset by the repurchase of 4.0 million shares of common stock for $
284.0 million
, capital expenditures of $
129.5 million
, and dividend payments of $
67.1 million
during the
three months ended
December 28, 2018
.
|
|
Three Months Ended
|
||||||
|
December 28,
2018 |
Change
|
December 29,
2017 |
||||
(dollars in millions)
|
|
|
|
||||
Net revenue
|
$
|
972.0
|
|
(7.6)%
|
$
|
1,051.9
|
|
|
Three Months Ended
|
||||||
|
December 28,
2018 |
Change
|
December 29,
2017 |
||||
(dollars in millions)
|
|
|
|
||||
Gross profit
|
$
|
485.1
|
|
(9.6)%
|
$
|
536.8
|
|
% of net revenue
|
49.9
|
%
|
|
51.0
|
%
|
|
Three Months Ended
|
||||||
|
December 28,
2018 |
Change
|
December 29,
2017 |
||||
(dollars in millions)
|
|
|
|
||||
Research and development
|
$
|
109.2
|
|
11.4%
|
$
|
98.0
|
|
% of net revenue
|
11.2
|
%
|
|
9.3
|
%
|
|
Three Months Ended
|
||||||
|
December 28,
2018 |
Change
|
December 29,
2017 |
||||
(dollars in millions)
|
|
|
|
||||
Selling, general and administrative
|
$
|
47.8
|
|
(6.8)%
|
$
|
51.3
|
|
% of net revenue
|
4.9
|
%
|
|
4.9
|
%
|
|
Three Months Ended
|
||||||
|
December 28,
2018 |
Change
|
December 29,
2017 |
||||
(dollars in millions)
|
|
|
|
||||
Amortization of purchased intangibles
|
$
|
14.0
|
|
250.0%
|
$
|
4.0
|
|
Amortization of capitalized software
|
1.5
|
|
100.0%
|
—
|
|
||
Total amortization of intangibles
|
$
|
15.5
|
|
|
$
|
4.0
|
|
% of net revenue
|
1.6
|
%
|
|
0.4
|
%
|
|
Three Months Ended
|
||||||
|
December 28,
2018 |
Change
|
December 29,
2017 |
||||
(dollars in millions)
|
|
|
|
||||
Provision for income taxes
|
$
|
38.9
|
|
(87.7)%
|
$
|
315.2
|
|
% of net revenue
|
4.0
|
%
|
|
30.0
|
%
|
|
Three Months Ended
|
||||||
(in millions)
|
December 28,
2018 |
|
December 29,
2017 |
||||
Cash and cash equivalents at beginning of period
|
$
|
733.3
|
|
|
$
|
1,616.8
|
|
Net cash provided by operating activities
|
549.0
|
|
|
360.8
|
|
||
Net cash provided by (used in) investing activities
|
171.5
|
|
|
(34.2
|
)
|
||
Net cash used in financing activities
|
(368.1
|
)
|
|
(261.9
|
)
|
||
Cash and cash equivalents at end of period
|
$
|
1,085.7
|
|
|
$
|
1,681.5
|
|
•
|
$284.0 million
related to our repurchase of
4.0 million
shares of our common stock pursuant to the stock repurchase program approved by our Board of Directors on
January 31, 2018
;
|
•
|
$67.1 million
related to the payment of cash dividends on our common stock; and
|
•
|
$19.4 million
related to the minimum statutory payroll tax withholdings upon vesting of employee performance and restricted stock awards.
|
Exhibit
Number
|
Exhibit Description
|
Form
|
Incorporated by Reference
|
Filed Herewith
|
||
File No.
|
Exhibit
|
Filing Date
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.1
|
|
|
|
|
|
X
|
|
|
|
|
|
|
|
31.1
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
31.2
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
32.1
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
32.2
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
101.INS
|
XBRL Instance Document
|
|
|
|
|
X
|
|
|
|
|
|
|
|
101.SCH
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
|
X
|
|
|
|
|
|
|
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
|
X
|
|
|
|
|
|
|
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
|
X
|
|
|
|
|
|
|
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
|
X
|
|
|
|
|
|
|
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
|
X
|
|
|
|
|
|
|
SKYWORKS SOLUTIONS, INC.
|
|
|
|
|
|
Date:
|
February 5, 2019
|
By:
|
/s/ Liam K. Griffin
|
|
|
|
Liam K. Griffin
|
|
|
|
President and Chief Executive Officer
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
By:
|
/s/ Kris Sennesael
|
|
|
|
Kris Sennesael
|
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
|
(Principal Accounting and Financial Officer)
|
1.
|
Purpose:
The FY19 Executive Incentive Plan (the "FY19 Plan") is designed to reward key management for achieving certain financial and business objectives.
|
2.
|
Plan Period:
The FY19 Plan covers the period from September 29, 2018 through September 27, 2019.
|
3.
|
Eligibility:
This program applies to the Chief Executive Officer and his direct reporting senior executives. Other key employees may be added based upon the recommendation of the Chief Executive Officer and subsequent approval of the Compensation Committee. Those employees not covered by this plan may be eligible for other programs established by Skyworks.
|
4.
|
Incentive Targets:
Participants are eligible to earn a percentage of their base salary for attaining certain performance objectives. Nominal, target and stretch incentive awards have been established as follows (shown as a percentage of the participant’s base salary):
|
Name
|
Incentive At Nominal
|
Incentive At Target
|
Incentive At Stretch
|
CEO
|
80%
|
160%
|
320%
|
CFO
|
50%
|
100%
|
200%
|
Other SVP/VPs
|
40%
|
80%
|
160%
|
Special Participants
|
TBD
|
TBD
|
TBD
|
5.
|
Metrics:
The performance metrics for FY19 are as follows:
|
Metric
|
Nominal
|
Target
|
Stretch
|
Corporate Revenue ($M)
|
REDACTED
|
REDACTED
|
REDACTED
|
Corporate Operating Income ($M)
1
|
REDACTED
|
REDACTED
|
REDACTED
|
1
Non-GAAP operating income dollars after incentive
|
|
Corporate
|
|
|
Revenue
|
OI$
|
All Executives
|
50%
|
50%
|
6.
|
How the Plan Works:
Upon completion of the Fiscal Year, the Chief Executive Officer will provide the Compensation Committee with recommendations for incentive award payments to the named participants of the plan. The Committee will review the recommendations and approve the actual amount to be paid to each participant. The Committee will rely upon the CEO for the appropriate distribution of the authorized incentive pool. All incentive award payments under the FY19 Plan, if earned, will be paid by March 15
th
of the calendar year following the end of the fiscal year in which the performance occurs.
|
7.
|
Administration:
Actual performance between the Nominal and Target metrics will be paid on a linear sliding scale beginning at the Nominal percentage and moving up to the Target percentage. The same linear scale will apply for performance between Target and Stretch metrics. In order to fund the incentive plans and insure the overall Company’s financial performance, the following terms apply.
|
◦
|
No incentive award will be paid unless the Company meets its threshold operating income goal (in dollars) after accounting for any incentive award payments.
|
◦
|
Incentive payments will be processed in a timely manner at the completion of the performance period. Skyworks’ CEO, subject to approval by the Compensation Committee, retains discretion to award below nominal or above Stretch and to modify all individual incentive payments to ensure equitable distribution of incentives; such modifications may include, but are not limited to, the delivery of equity or similar instruments in lieu of cash payments.
|
◦
|
Any payout shall be conditioned upon the Participant’s employment by the Company on the date of payment; provided, however, that the Compensation Committee may make exceptions to this requirement, in its sole discretion, including, without limitation, in the case of a participant’s termination of employment, retirement, death or disability.
|
◦
|
Any payments made under this Plan will be subject to the provisions of the compensation clawback policy that Skyworks implements to comply with applicable law following the SEC’s adoption of final rules related to compensation clawback policies as required by the Dodd-Frank Wall Street Reform and Consumer Protection Act.
|
8.
|
Taxes:
All awards are subject to federal, state, local and social security taxes. Payments under this Plan will not affect the base salary, which is used as the basis for Skyworks’ benefits program
.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Skyworks Solutions, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date:
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February 5, 2019
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/s/ Liam K. Griffin
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Liam K. Griffin
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President and Chief Executive Officer
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1.
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I have reviewed this quarterly report on Form 10-Q of Skyworks Solutions, Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b)
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designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d)
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disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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Date:
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February 5, 2019
|
|
|
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/s/ Kris Sennesael
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|
Kris Sennesael
|
|
Senior Vice President and Chief Financial Officer
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(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ Liam K. Griffin
|
Liam K. Griffin
President and Chief Executive Officer
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February 5, 2019
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ Kris Sennesael
|
Kris Sennesael
Senior Vice President and Chief Financial Officer
|
February 5, 2019
|