☑ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Massachusetts | 04-2348234 | |||||||||||||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||||||||
One Analog Way, | Wilmington, | MA | 01887 | |||||||||||
(Address of principal executive offices) | (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Common Stock $0.16 2/3 par value per share | ADI | Nasdaq Global Select Market |
Large accelerated filer
|
☑ | Accelerated filer | ☐ | |||||||||||||||||
Non-accelerated filer | ☐ | Smaller reporting company | ☐ | |||||||||||||||||
Emerging growth company | ☐ |
Document Description | Form 10-K Part | |||||||
Portions of the Registrant’s Proxy Statement for the Annual Meeting of Shareholders to be held March 10, 2021 | III | |||||||
Information About our Executive Officers
|
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End Market* |
Percent of Fiscal 2020 Revenue
|
Percent of Fiscal 2019 Revenue
|
Percent of Fiscal 2018 Revenue
|
|||||||||||||||||
Industrial | 53% | 50 | % | 51 | % | |||||||||||||||
Communications | 21% | 22 | % | 19 | % | |||||||||||||||
Automotive | 14% | 16 | % | 16 | % | |||||||||||||||
Consumer | 11% | 13 | % | 15 | % |
• Process control systems | • Oscilloscopes | |||||||
• Connected motion and robotics | • Lab, chemical, and environmental analyzers | |||||||
• Environmental control systems | • Weigh scales |
• Navigation systems | • Radar systems | |||||||
• Space and satellite communications | • Security devices | |||||||
• Communication systems | • Electronic surveillance and countermeasures |
• Ultrasound systems | • Anesthesia equipment | |||||||
• X-Ray equipment (CT and DR) | • Lab diagnostic equipment | |||||||
• Image guided therapy | • Surgical tools and instruments | |||||||
• Multi-parameter vital signs monitors | • Blood analyzers | |||||||
• Disease management, e.g. hypertension and diabetes | • Point-of-care diagnostics |
• Utility meters | • Wind turbines | |||||||
• Electric vehicle charging infrastructure | • Solar inverters | |||||||
• Substation relays and automation equipment | • Building energy automation/control |
• Cellular base station equipment | • Optical and cable networking equipment for data center and carrier providers | |||||||
• Microwave backhaul systems | • Satellite and terrestrial broadband access equipment |
• | Car audio, voice processing and connectivity | • | Inertial MEMS solutions for mission critical navigation, stability and safety systems | |||||||||||||||||||||||||||||
• | Video processing and connectivity | • | Battery monitoring and management systems |
• Portable devices (smart phones, tablets and wearable devices) for media and vital signs motoring applications | • Prosumer audio/video equipment |
• Broadcom Inc. | • Monolithic Power Systems, Inc. | |||||||
• Infineon Technologies AG | • NXP Semiconductors N.V. | |||||||
• Maxim Integrated Products, Inc. | • Texas Instruments Inc. | |||||||
• Microchip Technology Inc. | ||||||||
Properties | Approximate | |||||||||||||
Owned: | Use | Total Sq. Ft. | ||||||||||||
Cavite, Philippines | Wafer probe and testing, warehouse, engineering and administrative offices | 832,000 sq. ft. | ||||||||||||
Wilmington, MA | Corporate headquarters, wafer fabrication, testing, engineering, sales, marketing and administrative offices | 818,000 sq. ft. | ||||||||||||
Limerick, Ireland | Wafer fabrication, wafer probe and testing, warehouse and distribution, engineering and administrative offices | 632,000 sq. ft. | ||||||||||||
Milpitas, CA | Wafer fabrication, test and assembly; warehouse and distribution; engineering, sales, marketing and administrative offices | 427,000 sq. ft. | ||||||||||||
Singapore (1)
|
Wafer test and packaging, warehouse and distribution, engineering, sales and administrative offices | 384,000 sq. ft. | ||||||||||||
Penang, Malaysia (2)
|
Assembly and engineering offices, employee parking | 350,000 sq. ft. | ||||||||||||
Chelmsford, MA | Final assembly of certain module and subsystem-level products, testing, engineering and administrative offices | 174,000 sq. ft. | ||||||||||||
Camas, WA | Wafer fabrication | 105,000 sq. ft. | ||||||||||||
Greensboro, NC | Product testing, engineering and administrative offices | 99,000 sq. ft. | ||||||||||||
Lease | ||||||||||||||||||||||||||
Properties | Approximate | Termination | ||||||||||||||||||||||||
Leased: | Use | Total Sq. Ft. | (fiscal year) | Renewals | ||||||||||||||||||||||
Santa Clara, CA | Engineering, sales, marketing and administrative offices | 445,000 sq. ft. | 2030 |
2, five-yr.
periods |
||||||||||||||||||||||
Bangalore, India | Engineering and administrative offices | 175,000 sq. ft. | 2027 |
1, five-yr.
period |
||||||||||||||||||||||
Norwood, MA | Engineering, sales, marketing and administrative offices | 130,000 sq. ft. | 2022 |
2, five-yr.
periods |
||||||||||||||||||||||
Greensboro, NC | Engineering and administrative offices | 51,000 sq. ft. | 2024 |
1, five-yr.
period |
||||||||||||||||||||||
Shanghai, China | Engineering, sales and administrative offices | 59,000 sq. ft. | 2021 |
1, three-yr.
period |
||||||||||||||||||||||
Beijing, China | Engineering and sales offices | 58,000 sq. ft. | 2021 |
3, one- to three-yr.
periods |
Executive Officer | Age | Position(s) | Business Experience | |||||||||||||||||
Vincent Roche | 60 | President and Chief Executive Officer | President and Chief Executive Officer since May 2013; President since November 2012; Vice President, Strategic Segments Group and Global Sales from October 2009 to November 2012; Vice President, Worldwide Sales from March 2001 to October 2009; Vice President and General Manager, Silicon Valley Business Units and Computer & Networking from 1999 to March 2001; Product Line Director from 1995 to 1999; and Product Marketing Manager from 1988 to 1995. | |||||||||||||||||
Prashanth Mahendra-Rajah | 50 | Senior Vice President, Finance and Chief Financial Officer | Senior Vice President, Finance and Chief Financial Officer since September 2017; Chief Financial Officer of WABCO Holdings Inc., a supplier of commercial vehicle technologies, from June 2014 to September 2017; Corporate Vice President and Segment CFO of the Silicon Systems Group of Applied Materials Inc., a provider of manufacturing equipment, services and software to the global semiconductor industry, from April 2012 to June 2014. | |||||||||||||||||
Martin Cotter | 55 | Senior Vice President, Worldwide Sales and Digital Marketing | Senior Vice President, Worldwide Sales and Digital Marketing since September 2016; Vice President Internet of Things (IoT), Healthcare, and Consumer Business Units, from November 2015 to September 2016; Vice President, Healthcare and Consumer Business Groups from November 2014 to November 2015; and VP, Communications Infrastructure Business Unit from October 2012 to November 2014. | |||||||||||||||||
Joseph (John) Hassett | 62 | Senior Vice President, Industrial and Consumer | Senior Vice President, Industrial and Consumer since December 2019; Interim Senior Vice President, Industrial, Healthcare, and Consumer from June 2019 to December 2019; Senior Vice President, Global Operations and Technology from May 2015 to June 2019; Vice President Assembly and Test Worldwide Manufacturing from 1994 to May 2015; and Director Assembly Operations Worldwide Manufacturing from 1990 to 1994. | |||||||||||||||||
Gregory Henderson | 52 | Senior Vice President, Automotive, Communications and Aerospace and Defense | Senior Vice President, Automotive, Communications and Aerospace and Defense since June 2017; Vice President, RF and Microwave Business Unit from July 2014 to June 2017; Vice President of the RF and Microwave Business Unit of Hittite Microwave Corporation, a maker of chips and related components, from October 2013 to July 2014; and Director Product Management of Harris Corporation, a defense contractor and technology provider of communications, electronic, and space and intelligence systems, from 2011 to October 2013. | |||||||||||||||||
Steve Pietkiewicz | 61 | Senior Vice President, Power Products | Senior Vice President, Power Products since June 2017; Vice President and General Manager of S Power Products from March 2017 to June 2017; Vice President and General Manager of S Power Products at Linear Technology Corporation, a manufacturer of high performance linear integrated circuits, from July 2007 to March 2017; General Manager, S Power Products at Linear Technology Corporation from April 2005 to July 2007; and Design Manager at Linear Technology Corporation from April 1995 to April 2005. | |||||||||||||||||
Period |
Total Number of
Shares Purchased (1) |
Average Price Paid
Per Share (2) |
Total Number of Shares
Purchased as Part of Publicly Announced Plans or Programs (3) |
Approximate Dollar
Value of Shares that May Yet Be Purchased Under the Plans or Programs |
||||||||||||||||||||||
August 2, 2020 through August 29, 2020 | 9,671 | $ | 117.38 | — | $ | 1,893,079,550 | ||||||||||||||||||||
August 30, 2020 through September 26, 2020 | 4,702 | $ | 114.52 | — | $ | 1,893,079,550 | ||||||||||||||||||||
September 27, 2020 through October 31, 2020 | 44,794 | $ | 123.86 | — | $ | 1,893,079,550 | ||||||||||||||||||||
Total | 59,167 | $ | 122.06 | — | $ | 1,893,079,550 |
(thousands, except per share amounts) | 2020 |
2019
|
2018
|
2017 | 2016 | ||||||||||||||||||||||||
Statement of Income data: | |||||||||||||||||||||||||||||
Revenue | $ | 5,603,056 | $ | 5,991,065 | $ | 6,224,689 | $ | 5,246,354 | $ | 3,421,409 | |||||||||||||||||||
Net income | $ | 1,220,761 | $ | 1,363,011 | $ | 1,506,980 | $ | 805,379 | $ | 861,664 | |||||||||||||||||||
Net income per common share | |||||||||||||||||||||||||||||
Basic | $ | 3.31 | $ | 3.68 | $ | 4.05 | $ | 2.32 | $ | 2.79 | |||||||||||||||||||
Diluted | $ | 3.28 | $ | 3.65 | $ | 4.00 | $ | 2.29 | $ | 2.76 | |||||||||||||||||||
Dividends declared per common share | $ | 2.40 | $ | 2.10 | $ | 1.89 | $ | 1.77 | $ | 1.66 | |||||||||||||||||||
Balance Sheet data: | |||||||||||||||||||||||||||||
Total assets | $ | 21,468,603 | $ | 21,392,641 | $ | 20,438,366 | $ | 21,118,283 | $ | 7,970,278 | |||||||||||||||||||
Debt | $ | 5,145,102 | $ | 5,491,919 | $ | 6,332,674 | $ | 7,851,084 | $ | 1,732,177 |
Fiscal Year | 2020 over 2019 | 2019 over 2018 | |||||||||||||||||||||||||||||||||||||||
2020 |
2019
|
2018 (1)
|
$ Change | % Change | $ Change | % Change | |||||||||||||||||||||||||||||||||||
Revenue | $ | 5,603,056 | $ | 5,991,065 | $ | 6,224,689 | $ | (388,009) | (6) | % | $ | (233,624) | (4) | % | |||||||||||||||||||||||||||
Gross margin % | 65.9 | % | 67.0 | % | 68.3 | % | |||||||||||||||||||||||||||||||||||
Net income | $ | 1,220,761 | $ | 1,363,011 | $ | 1,506,980 | $ | (142,250) | (10) | % | $ | (143,969) | (10) | % | |||||||||||||||||||||||||||
Net income as a % of revenue | 21.8 | % | 22.8 | % | 24.2 | % | |||||||||||||||||||||||||||||||||||
Diluted EPS | $ | 3.28 | $ | 3.65 | $ | 4.00 | $ | (0.37) | (10) | % | $ | (0.35) | (9) | % | |||||||||||||||||||||||||||
_______________________________________
(1) Balances have been restated to reflect the adoption of Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers (ASU 2014-09). See Note 2a, Principles of Consolidation, of the Notes to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K.
|
2020 | 2019 | 2018 (1) | |||||||||||||||||||||||||||||||||||||||||||||
Revenue |
% of
Total Product Revenue (2) |
Y/Y% | Revenue |
% of
Total Product Revenue (2) |
Y/Y% | Revenue |
% of
Total Product Revenue (2) |
||||||||||||||||||||||||||||||||||||||||
Industrial | $ | 2,987,542 | 53 | % | (1) | % | $ | 3,011,411 | 50 | % | (4) | % | $ | 3,143,566 | 51 | % | |||||||||||||||||||||||||||||||
Communications | 1,195,946 | 21 | % | (8) | % | 1,294,960 | 22 | % | 12 | % | 1,155,826 | 19 | % | ||||||||||||||||||||||||||||||||||
Automotive | 779,276 | 14 | % | (16) | % | 930,613 | 16 | % | (8) | % | 1,006,886 | 16 | % | ||||||||||||||||||||||||||||||||||
Consumer | 640,292 | 11 | % | (15) | % | 754,081 | 13 | % | (18) | % | 918,411 | 15 | % | ||||||||||||||||||||||||||||||||||
Total Revenue | $ | 5,603,056 | 100 | % | (6) | % | $ | 5,991,065 | 100 | % | (4) | % | $ | 6,224,689 | 100 | % |
2020 | 2019 | 2018 (1) | ||||||||||||||||||||||||||||||||||||
Revenue |
% of
Total Revenue (2) |
Revenue |
% of
Total Revenue (2) |
Revenue |
% of
Total Revenue (2) |
|||||||||||||||||||||||||||||||||
Distributors | $ | 3,216,302 | 57 | % | $ | 3,409,161 | 57 | % | $ | 3,424,145 | 55 | % | ||||||||||||||||||||||||||
Direct customers | 2,300,493 | 41 | % | 2,506,065 | 42 | % | 2,721,885 | 44 | % | |||||||||||||||||||||||||||||
Other | 86,261 | 2 | % | 75,839 | 1 | % | 78,659 | 1 | % | |||||||||||||||||||||||||||||
Total Revenue | $ | 5,603,056 | 100 | % | $ | 5,991,065 | 100 | % | $ | 6,224,689 | 100 | % |
Change | |||||||||||||||||||||||||||||||||||||||||
Fiscal Year | 2020 over 2019 | 2019 over 2018 | |||||||||||||||||||||||||||||||||||||||
2020 | 2019 | 2018 (1) | $ Change | % Change (2) | $ Change | % Change (2) | |||||||||||||||||||||||||||||||||||
United States | $ | 1,887,443 | $ | 2,020,886 | $ | 2,277,084 | $ | (133,443) | (7) | % | $ | (256,198) | (11) | % | |||||||||||||||||||||||||||
Rest of North and South America | 41,250 | 55,059 | 46,276 | (13,809) | (25) | % | 8,783 | 19 | % | ||||||||||||||||||||||||||||||||
Europe | 1,245,695 | 1,374,673 | 1,405,686 | (128,978) | (9) | % | (31,013) | (2) | % | ||||||||||||||||||||||||||||||||
Japan | 521,720 | 657,632 | 714,846 | (135,912) | (21) | % | (57,214) | (8) | % | ||||||||||||||||||||||||||||||||
China | 1,348,011 | 1,316,275 | 1,215,949 | 31,736 | 2 | % | 100,326 | 8 | % | ||||||||||||||||||||||||||||||||
Rest of Asia | 558,937 | 566,540 | 564,848 | (7,603) | (1) | % | 1,692 | — | % | ||||||||||||||||||||||||||||||||
Total Revenue | $ | 5,603,056 | $ | 5,991,065 | $ | 6,224,689 | $ | (388,009) | (6) | % | $ | (233,624) | (4) | % |
Change | |||||||||||||||||||||||||||||||||||||||||
Fiscal Year | 2020 over 2019 | 2019 over 2018 | |||||||||||||||||||||||||||||||||||||||
2020 | 2019 | 2018 (1) | $ Change | % Change | $ Change | % Change | |||||||||||||||||||||||||||||||||||
Gross margin | $ | 3,690,478 | $ | 4,013,750 | $ | 4,250,396 | $ | (323,272) | (8) | % | $ | (236,646) | (6) | % | |||||||||||||||||||||||||||
Gross margin % | 65.9 | % | 67.0 | % | 68.3 | % |
Change | |||||||||||||||||||||||||||||||||||||||||
Fiscal Year | 2020 over 2019 | 2019 over 2018 | |||||||||||||||||||||||||||||||||||||||
2020 | 2019 | 2018 | $ Change | % Change | $ Change | % Change | |||||||||||||||||||||||||||||||||||
R&D expenses | $ | 1,050,519 | $ | 1,130,348 | $ | 1,165,047 | $ | (79,829) | (7) | % | $ | (34,699) | (3) | % | |||||||||||||||||||||||||||
R&D expenses as a % of revenue | 18.7 | % | 18.9 | % | 18.7 | % |
Change | |||||||||||||||||||||||||||||||||||||||||
Fiscal Year | 2020 over 2019 | 2019 over 2018 | |||||||||||||||||||||||||||||||||||||||
2020 | 2019 | 2018 | $ Change | % Change | $ Change | % Change | |||||||||||||||||||||||||||||||||||
SMG&A expenses | $ | 659,923 | $ | 648,094 | $ | 695,540 | $ | 11,829 | 2 | % | $ | (47,446) | (7) | % | |||||||||||||||||||||||||||
SMG&A expenses as a % of revenue | 11.8 | % | 10.8 | % | 11.2 | % |
Change | |||||||||||||||||||||||||||||||||||||||||
Fiscal Year | 2020 over 2019 | 2019 over 2018 | |||||||||||||||||||||||||||||||||||||||
2020 | 2019 | 2018 (1) | $ Change | % Change | $ Change | % Change | |||||||||||||||||||||||||||||||||||
Operating income | $ | 1,498,244 | $ | 1,710,608 | $ | 1,899,589 | $ | (212,364) | (12) | % | $ | (188,981) | (10) | % | |||||||||||||||||||||||||||
Operating income as a % of revenue | 26.7 | % | 28.6 | % | 30.5 | % |
Change | |||||||||||||||||||||||||||||
Fiscal Year | 2020 over 2019 | 2019 over 2018 | |||||||||||||||||||||||||||
2020 | 2019 | 2018 | $ Change | $ Change | |||||||||||||||||||||||||
Total Nonoperating expense | $ | 186,627 | $ | 224,880 | $ | 244,275 | $ | (38,253) | $ | (19,395) |
Change | |||||||||||||||||||||||||||||||||||||||||
Fiscal Year | 2020 over 2019 | 2019 over 2018 | |||||||||||||||||||||||||||||||||||||||
2020 | 2019 | 2018 (1) | $ Change | % Change | $ Change | % Change | |||||||||||||||||||||||||||||||||||
Provision for income taxes | $ | 90,856 | $ | 122,717 | $ | 148,334 | $ | (31,861) | (26) | % | $ | (25,617) | (17) | % | |||||||||||||||||||||||||||
Effective income tax rate | 6.9 | % | 8.3 | % | 9.0 | % |
Change | |||||||||||||||||||||||||||||||||||||||||
Fiscal Year | 2020 over 2019 | 2019 over 2018 | |||||||||||||||||||||||||||||||||||||||
2020 | 2019 | 2018 (1) | $ Change | % Change | $ Change | % Change | |||||||||||||||||||||||||||||||||||
Net income | $ | 1,220,761 | $ | 1,363,011 | $ | 1,506,980 | $ | (142,250) | (10) | % | $ | (143,969) | (10) | % | |||||||||||||||||||||||||||
Net income, as a % of revenue | 21.8 | % | 22.8 | % | 24.2 | % | |||||||||||||||||||||||||||||||||||
Diluted EPS | $ | 3.28 | $ | 3.65 | $ | 4.00 | $ | (0.37) | (10) | % | $ | (0.35) | (9) | % |
Fiscal Year | |||||||||||||||||
2020 | 2019 | 2018 (1) | |||||||||||||||
Net cash provided by operating activities | $ | 2,008,487 | $ | 2,253,100 | $ | 2,442,361 | |||||||||||
Net cash provided by operating activities as a % of revenue | 35.8 | % | 37.6 | % | 39.2 | % | |||||||||||
Net cash used for investing activities | $ | (180,523) | $ | (293,186) | $ | (313,998) | |||||||||||
Net cash used for financing activities | $ | (1,420,608) | $ | (2,126,794) | $ | (2,358,042) |
Fiscal Year | ||||||||||||||||||||
2020 | 2019 | $ Change | % Change | |||||||||||||||||
Accounts receivable, net | $ | 737,536 | $ | 635,136 | $ | 102,400 | 16 | % | ||||||||||||
Days sales outstanding (1)
|
45 | 39 | ||||||||||||||||||
Inventory | $ | 608,260 | $ | 609,886 | $ | (1,626) | — | % | ||||||||||||
Days cost of sales in inventory (1)
|
116 | 110 |
Payment due by period | ||||||||||||||||||||||||||||||||
Less than | More than | |||||||||||||||||||||||||||||||
(thousands) | Total | 1 Year | 1-3 Years | 3-5 Years | 5 Years | |||||||||||||||||||||||||||
Contractual obligations: | ||||||||||||||||||||||||||||||||
Transition tax (1)
|
$ | 626,742 | $ | 59,690 | $ | 119,380 | $ | 261,143 | $ | 186,529 | ||||||||||||||||||||||
Operating leases (2)
|
380,843 | 49,526 | 83,038 | 74,570 | 173,709 | |||||||||||||||||||||||||||
Other long-term liabilities (3) | 69,921 | 37,131 | 31,333 | 87 | 1,370 | |||||||||||||||||||||||||||
Debt obligations (4)
|
5,175,000 | — | 1,825,000 | 950,000 | 2,400,000 | |||||||||||||||||||||||||||
Interest payments associated with debt obligations | 1,299,346 | 161,321 | 289,731 | 220,494 | 627,800 | |||||||||||||||||||||||||||
Deferred compensation plan (5)
|
52,956 | 801 | — | — | 52,155 | |||||||||||||||||||||||||||
Pension funding (6)
|
6,985 | 6,985 | — | — | — | |||||||||||||||||||||||||||
Total | $ | 7,611,793 | $ | 315,454 | $ | 2,348,482 | $ | 1,506,294 | $ | 3,441,563 |
October 31, 2020 | November 2, 2019 | ||||||||||||||||||||||||||||||||||
(thousands) | Principal Amount Outstanding | Fair Value | Fair Value given an increase in interest rates of 100 basis points | Principal Amount Outstanding | Fair Value | Fair Value given an increase in interest rates of 100 basis points | |||||||||||||||||||||||||||||
2020 Notes, due March 2020 | $ | — | $ | — | $ | — | $ | 300,000 | $ | 300,872 | $ | 299,793 | |||||||||||||||||||||||
2021 Notes, due January 2021 | — | — | — | 450,000 | 454,634 | 449,354 | |||||||||||||||||||||||||||||
2021 Notes, due December 2021 | 400,000 | 408,565 | 404,170 | 400,000 | 402,591 | 394,524 | |||||||||||||||||||||||||||||
2023 Notes, due June 2023 | 500,000 | 526,855 | 513,874 | 500,000 | 511,190 | 494,186 | |||||||||||||||||||||||||||||
2023 Notes, due December 2023 | 550,000 | 590,177 | 572,965 | 550,000 | 567,159 | 545,897 | |||||||||||||||||||||||||||||
2025 Notes, due April 2025 | 400,000 | 434,919 | 417,225 | — | — | — | |||||||||||||||||||||||||||||
2025 Notes, due December 2025 | 850,000 | 969,033 | 924,695 | 850,000 | 914,567 | 866,162 | |||||||||||||||||||||||||||||
2026 Notes, due December 2026 | 900,000 | 1,017,505 | 962,821 | 900,000 | 940,192 | 883,276 | |||||||||||||||||||||||||||||
2036 Notes, due December 2036 | 250,000 | 298,153 | 265,210 | 250,000 | 270,891 | 240,492 | |||||||||||||||||||||||||||||
2045 Notes, due December 2045 | 400,000 | 538,788 | 463,425 | 400,000 | 491,439 | 423,591 |
October 31, 2020 | November 2, 2019 | ||||||||||
Fair value of forward exchange contracts assets | $ | 5,427 | $ | — | |||||||
Fair value of forward exchange contracts after a 10% unfavorable movement in foreign currency exchange rates asset | $ | 21,859 | $ | 20,810 | |||||||
Fair value of forward exchange contracts after a 10% favorable movement in foreign currency exchange rates liability | $ | (20,276) | $ | (19,269) |
Revenue Recognition – Measuring Variable Consideration | |||||
Description of the Matter |
As described in Note 2 to the consolidated financial statements, the Company's sales contracts provide certain distributors with credits for price protection and rights of return, which results in variable consideration. During 2020, sales to distributors were $3.2 billion net of expected price protection discounts and rights of return for which the liability balance as of October 31, 2020 was $229.8 million.
Auditing the Company's measurement of variable consideration under distributor contracts involved especially challenging judgment because the calculation involves subjective management assumptions about estimates of expected price protection discounts and returns. For example, estimated variable consideration included in the transaction price reflects management's evaluation of contractual terms, historical experience and assumptions about future economic conditions. Changes in those assumptions can have a material effect on the amount of variable consideration recognized.
|
||||
How We Addressed the Matter in Our Audit |
We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company's process to calculate the variable consideration. For example, we tested controls over the appropriateness of assumptions management used as well as controls over the completeness and accuracy of the data underlying estimates of expected price protection discounts and returns.
Our audit procedures included, among others, inspecting contractual terms in distributor agreements and testing the underlying data used in management’s calculation for completeness and accuracy as well as evaluating the significant assumptions used in the estimation of variable consideration. We evaluated the Company’s methods and assumptions used in the estimates, which included comparing the assumptions to historical trends. We inspected and tested the results of the Company's retrospective review analysis of actual returns and price protection discounts claimed by distributors, evaluated the estimates made based on historical experience and performed sensitivity analyses of the Company’s significant assumptions to assess the impact on the variable consideration. We also evaluated whether the Company appropriately considered new information that could significantly change the estimated future price protection discounts or returns.
|
||||
Goodwill – Quantitative Impairment Assessment | |||||
Description of the Matter |
The Company’s consolidated goodwill balance was $12.3 billion as of October 31, 2020. As described in Note 2 to the consolidated financial statements, the Company evaluates goodwill for impairment at the reporting unit level annually and performed a quantitative goodwill impairment assessment for each of its eight reporting units. The quantitative impairment assessment involves the comparison of the fair value of each reporting unit to its respective carrying amount. The Company used a weighting of the income and market approaches to determine the fair value of each reporting unit.
Auditing management's quantitative goodwill impairment test involved a high degree of auditor judgment due to the significant estimation required to determine the fair value of each reporting unit. In particular, the fair value estimate for one of the eight reporting units was sensitive to significant assumptions, such as forecasted revenues, gross profit margins, operating income margins, long-term discount rate, perpetual growth rate, identification of comparable publicly traded companies and estimated valuation multiples, which led to a high degree of auditor judgment, subjectivity and effort in performing procedures and evaluating management’s significant assumptions as outlined above, used in determining the fair value of this reporting unit.
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How We Addressed the Matter in Our Audit |
We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company's quantitative goodwill impairment assessment process. For example, we tested controls over management's review of the valuation model and the significant assumptions used.
To test the estimated fair value of the reporting unit, our audit procedures included, among others, assessing methodologies and testing the significant assumptions discussed above and the underlying data used by the Company in its analysis. We tested significant assumptions by comparing them to current and forecasted industry and economic trends, analyst reports, and forecasted peer company information. We evaluated management’s ability to accurately forecast by comparing actual results to historical forecasts. We also performed sensitivity analyses of certain assumptions to evaluate changes in the fair value that would result from changes in the assumptions. With the assistance of our valuation specialists, we evaluated the selection of the long-term discount rate and perpetual growth rate, including testing the underlying source information and the mathematical accuracy of the calculations by developing a range of independent estimates and comparing those to the rates selected by management. We also involved our valuation specialists to evaluate the market approach, including evaluating the reasonableness of the selected comparable publicly traded companies and the resulting market multiples calculation.
|
(thousands, except per share amounts) | 2020 |
2019
|
2018 (1)
|
||||||||||||||
Revenue | |||||||||||||||||
Revenue | $ | 5,603,056 | $ | 5,991,065 | $ | 6,224,689 | |||||||||||
Costs and Expenses | |||||||||||||||||
Cost of sales | 1,912,578 | 1,977,315 | 1,974,293 | ||||||||||||||
Gross margin | 3,690,478 | 4,013,750 | 4,250,396 | ||||||||||||||
Operating expenses: | |||||||||||||||||
Research and development | 1,050,519 | 1,130,348 | 1,165,047 | ||||||||||||||
Selling, marketing, general and administrative | 659,923 | 648,094 | 695,540 | ||||||||||||||
Amortization of intangibles | 429,455 | 429,041 | 428,902 | ||||||||||||||
Special charges | 52,337 | 95,659 | 61,318 | ||||||||||||||
2,192,234 | 2,303,142 | 2,350,807 | |||||||||||||||
Operating income: | 1,498,244 | 1,710,608 | 1,899,589 | ||||||||||||||
Nonoperating expense (income): | |||||||||||||||||
Interest expense | 193,305 | 229,075 | 253,589 | ||||||||||||||
Interest income | (4,305) | (10,229) | (9,383) | ||||||||||||||
Other, net | (2,373) | 6,034 | 69 | ||||||||||||||
186,627 | 224,880 | 244,275 | |||||||||||||||
Earnings | |||||||||||||||||
Income before income taxes | 1,311,617 | 1,485,728 | 1,655,314 | ||||||||||||||
Provision for income taxes | 90,856 | 122,717 | 148,334 | ||||||||||||||
Net income | $ | 1,220,761 | $ | 1,363,011 | $ | 1,506,980 | |||||||||||
Shares used to compute earnings per common share — basic | 368,633 | 369,133 | 370,430 | ||||||||||||||
Shares used to compute earnings per common share — diluted | 371,973 | 372,871 | 374,938 | ||||||||||||||
Basic earnings per common share | $ | 3.31 | $ | 3.68 | $ | 4.05 | |||||||||||
Diluted earnings per common share | $ | 3.28 | $ | 3.65 | $ | 4.00 | |||||||||||
_______________________________________
(1) Balances have been restated to reflect the adoption of Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers (ASU 2014-09). See Note 2a, Principles of Consolidation, of the Notes to Consolidated Financial Statements.
|
(thousands) | 2020 | 2019 |
2018 (1)
|
||||||||||||||
Net income | $ | 1,220,761 | $ | 1,363,011 | $ | 1,506,980 | |||||||||||
Foreign currency translation adjustment | 3,224 | (1,365) | (6,222) | ||||||||||||||
Change in fair value of available-for-sale securities | — | 10 | (10) | ||||||||||||||
Change in unrecognized gains/losses on derivative instruments designated as cash flow hedges: | |||||||||||||||||
Changes in fair value of derivatives (net of tax of $17,468 in 2020, $29,401 in 2019 and $416 in 2018)
|
(51,437) | (111,327) | (1,863) | ||||||||||||||
Adjustment for realized gain/loss reclassified into earnings (net of tax of $158 in 2020, $1,518 in 2019 and $94 in 2018)
|
(839) | 7,667 | (1,613) | ||||||||||||||
Total change in derivative instruments designated as cash flow hedges, net of tax | (52,276) | (103,660) | (3,476) | ||||||||||||||
Changes in accumulated other comprehensive loss — pension plans: | |||||||||||||||||
Change in transition asset | — | — | 10 | ||||||||||||||
Change in actuarial loss/gain (net of tax of $5,167 in 2020, $5,734 in 2019 and $2,363 in 2018)
|
(10,231) | (24,344) | 12,616 | ||||||||||||||
Change in prior service cost/income | — | — | 1 | ||||||||||||||
Total change in accumulated other comprehensive loss — pension plans, net of tax | (10,231) | (24,344) | 12,627 | ||||||||||||||
Other comprehensive (loss) income | (59,283) | (129,359) | 2,919 | ||||||||||||||
Comprehensive income | $ | 1,161,478 | $ | 1,233,652 | $ | 1,509,899 | |||||||||||
_______________________________________
(1) Balances have been restated to reflect the adoption of Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers (ASU 2014-09). See Note 2a, Principles of Consolidation, of the Notes to Consolidated Financial Statements.
|
(thousands, except per share amounts) | 2020 | 2019 | |||||||||
ASSETS | |||||||||||
Current Assets | |||||||||||
Cash and cash equivalents | $ | 1,055,860 | $ | 648,322 | |||||||
Accounts receivable less allowances of $4,350 ($8,387 in 2019)
|
737,536 | 635,136 | |||||||||
Inventories | 608,260 | 609,886 | |||||||||
Prepaid expenses and other current assets | 116,032 | 91,782 | |||||||||
Total current assets | 2,517,688 | 1,985,126 | |||||||||
Property, Plant and Equipment, at Cost | |||||||||||
Land and buildings | 974,604 | 956,099 | |||||||||
Machinery and equipment | 2,667,846 | 2,609,493 | |||||||||
Office equipment | 85,291 | 85,490 | |||||||||
Leasehold improvements | 157,915 | 160,175 | |||||||||
3,885,656 | 3,811,257 | ||||||||||
Less accumulated depreciation and amortization | 2,765,095 | 2,591,268 | |||||||||
Net property, plant and equipment | 1,120,561 | 1,219,989 | |||||||||
Other Assets | |||||||||||
Other investments | 86,729 | 77,324 | |||||||||
Goodwill | 12,278,425 | 12,256,880 | |||||||||
Intangible assets, net | 3,650,280 | 4,217,224 | |||||||||
Deferred tax assets | 1,503,064 | 1,582,382 | |||||||||
Other assets | 311,856 | 53,716 | |||||||||
Total other assets | 17,830,354 | 18,187,526 | |||||||||
$ | 21,468,603 | $ | 21,392,641 | ||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||
Current Liabilities | |||||||||||
Accounts payable | $ | 227,273 | $ | 225,270 | |||||||
Income taxes payable | 182,080 | 187,879 | |||||||||
Debt, current | — | 299,667 | |||||||||
Accrued liabilities | 955,633 | 795,816 | |||||||||
Total current liabilities | 1,364,986 | 1,508,632 | |||||||||
Non-current Liabilities | |||||||||||
Long-term debt | 5,145,102 | 5,192,252 | |||||||||
Deferred income taxes | 1,919,595 | 2,088,212 | |||||||||
Income taxes payable | 591,780 | 654,420 | |||||||||
Other non-current liabilities | 449,195 | 239,937 | |||||||||
Total non-current liabilities | 8,105,672 | 8,174,821 | |||||||||
Commitments and contingencies (Note 10) | |||||||||||
Shareholders’ Equity | |||||||||||
Preferred stock, $1.00 par value, 471,934 shares authorized, none outstanding
|
— | — | |||||||||
Common stock, $0.16 2/3 par value, 1,200,000,000 shares authorized, 369,484,899 shares outstanding (368,302,369 on November 2, 2019)
|
61,582 | 61,385 | |||||||||
Capital in excess of par value | 4,949,586 | 4,936,349 | |||||||||
Retained earnings | 7,236,238 | 6,899,253 | |||||||||
Accumulated other comprehensive loss | (249,461) | (187,799) | |||||||||
Total shareholders’ equity | 11,997,945 | 11,709,188 | |||||||||
$ | 21,468,603 | $ | 21,392,641 |
Capital in |
Accumulated
Other |
||||||||||||||||||||||||||||
Common Stock | Excess of | Retained | Comprehensive | ||||||||||||||||||||||||||
(thousands) | Shares | Amount | Par Value | Earnings | (Loss) Income | ||||||||||||||||||||||||
BALANCE, OCTOBER 28, 2017 (1)
|
368,636 | $ | 61,441 | $ | 5,250,519 | $ | 5,179,024 | $ | (61,359) | ||||||||||||||||||||
Net Income — 2018 (1)
|
1,506,980 | ||||||||||||||||||||||||||||
Dividends declared and paid - $1.89 per share
|
(703,307) | ||||||||||||||||||||||||||||
Issuance of stock under stock plans and other | 4,012 | 668 | 98,359 | ||||||||||||||||||||||||||
Tax benefit — equity based awards | 7,741 | ||||||||||||||||||||||||||||
Stock-based compensation expense | 151,165 | ||||||||||||||||||||||||||||
Other comprehensive income | 2,919 | ||||||||||||||||||||||||||||
Common stock repurchased | (2,488) | (415) | (225,562) | ||||||||||||||||||||||||||
BALANCE, NOVEMBER 3, 2018 (1)
|
370,160 | 61,694 | 5,282,222 | 5,982,697 | (58,440) | ||||||||||||||||||||||||
Effect of Accounting Standards Update 2016-16 | 331,026 | ||||||||||||||||||||||||||||
Net Income — 2019
|
1,363,011 | ||||||||||||||||||||||||||||
Dividends declared and paid - $2.10 per share
|
(777,481) | ||||||||||||||||||||||||||||
Issuance of stock under stock plans and other | 4,271 | 712 | 115,811 | ||||||||||||||||||||||||||
Stock-based compensation expense | 150,300 | ||||||||||||||||||||||||||||
Other comprehensive loss | (129,359) | ||||||||||||||||||||||||||||
Common stock repurchased | (6,129) | (1,021) | (611,984) | ||||||||||||||||||||||||||
BALANCE, NOVEMBER 2, 2019
|
368,302 | 61,385 | 4,936,349 | 6,899,253 | (187,799) | ||||||||||||||||||||||||
Effect of Accounting Standards Update 2018-02
|
2,379 | (2,379) | |||||||||||||||||||||||||||
Net Income — 2020
|
1,220,761 | ||||||||||||||||||||||||||||
Dividends declared and paid - $2.40 per share
|
(886,155) | ||||||||||||||||||||||||||||
Issuance of stock under stock plans and other | 3,110 | 518 | 67,885 | ||||||||||||||||||||||||||
Issuance of stock as charitable contribution | 336 | 56 | 39,944 | ||||||||||||||||||||||||||
Stock-based compensation expense | 149,518 | ||||||||||||||||||||||||||||
Other comprehensive loss | (59,283) | ||||||||||||||||||||||||||||
Common stock repurchased | (2,263) | (377) | (244,110) | ||||||||||||||||||||||||||
BALANCE, OCTOBER 31, 2020
|
369,485 | $ | 61,582 | $ | 4,949,586 | $ | 7,236,238 | $ | (249,461) |
(thousands) | 2020 | 2019 |
2018 (1)
|
||||||||||||||
Cash flows from operating activities: | |||||||||||||||||
Net income | $ | 1,220,761 | $ | 1,363,011 | $ | 1,506,980 | |||||||||||
Adjustments to reconcile net income to net cash provided by operations: | |||||||||||||||||
Depreciation | 233,775 | 240,677 | 228,525 | ||||||||||||||
Amortization of intangibles | 577,148 | 570,574 | 570,538 | ||||||||||||||
Stock-based compensation expense | 149,518 | 150,300 | 151,165 | ||||||||||||||
Non-cash impairment included in special charges | — | 14,167 | — | ||||||||||||||
Other non-cash activity | 5,418 | 40,907 | 36,569 | ||||||||||||||
Non-cash contribution to charitable foundation | 40,000 | — | — | ||||||||||||||
Deferred income taxes | (113,948) | (91,253) | (730,376) | ||||||||||||||
Change in operating assets and liabilities: | |||||||||||||||||
Accounts receivable | (101,626) | 5,890 | 45,979 | ||||||||||||||
Inventories | 1,760 | (42,771) | (34,636) | ||||||||||||||
Prepaid expenses and other current assets | (3,666) | (11,797) | (1,588) | ||||||||||||||
Deferred compensation plan investments | (3,853) | (7,301) | (7,484) | ||||||||||||||
Accounts payable and accrued liabilities | 103,104 | (6,371) | (18,397) | ||||||||||||||
Deferred compensation plan liability | 3,853 | 7,308 | 7,484 | ||||||||||||||
Income taxes payable, current | 29,441 | 74,993 | (8,506) | ||||||||||||||
Other liabilities | (133,198) | (55,234) | 696,108 | ||||||||||||||
Total adjustments | 787,726 | 890,089 | 935,381 | ||||||||||||||
Net cash provided by operating activities | 2,008,487 | 2,253,100 | 2,442,361 | ||||||||||||||
Cash flows from investing: | |||||||||||||||||
Additions to property, plant and equipment, net | (165,692) | (275,372) | (254,876) | ||||||||||||||
Payments for acquisitions, net of cash acquired | (14,196) | (11,170) | (52,839) | ||||||||||||||
Change in other assets | (635) | (6,644) | (6,283) | ||||||||||||||
Net cash used for investing activities | (180,523) | (293,186) | (313,998) | ||||||||||||||
Cash flows from financing activities: | |||||||||||||||||
Proceeds from debt | 395,646 | 1,250,000 | 743,778 | ||||||||||||||
Early termination of debt | — | (1,250,000) | — | ||||||||||||||
Debt repayments | (750,000) | (850,000) | (2,275,000) | ||||||||||||||
Payments on revolver | (350,000) | (75,000) | — | ||||||||||||||
Proceeds from revolver | 350,000 | 75,000 | — | ||||||||||||||
Dividend payments to shareholders | (886,155) | (777,481) | (703,307) | ||||||||||||||
Repurchase of common stock | (244,487) | (613,005) | (225,977) | ||||||||||||||
Proceeds from employee stock plans | 68,403 | 116,523 | 99,027 | ||||||||||||||
Change in other financing activities | (4,015) | (2,831) | 3,437 | ||||||||||||||
Net cash used for financing activities | (1,420,608) | (2,126,794) | (2,358,042) | ||||||||||||||
Effect of exchange rate changes on cash | 182 | (1,389) | (1,568) | ||||||||||||||
Net increase (decrease) in cash and cash equivalents | 407,538 | (168,269) | (231,247) | ||||||||||||||
Cash and cash equivalents at beginning of year | 648,322 | 816,591 | 1,047,838 | ||||||||||||||
Cash and cash equivalents at end of year | $ | 1,055,860 | $ | 648,322 | $ | 816,591 |
Consolidated Statement of Income | As Reported | Impact of Adoption of ASU 2014-09 | Impact of Adoption of ASU 2017-07 | As Adjusted | |||||||||||||||||||
Revenue | $ | 6,200,942 | $ | 23,747 | $ | — | $ | 6,224,689 | |||||||||||||||
Cost of sales | 1,967,640 | 6,950 | (297) | 1,974,293 | |||||||||||||||||||
Gross margin | 4,233,302 | 16,797 | 297 | 4,250,396 | |||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||
Research and development | 1,165,410 | — | (363) | 1,165,047 | |||||||||||||||||||
Selling, marketing, general and administrative | 695,937 | — | (397) | 695,540 | |||||||||||||||||||
Amortization of intangibles | 428,902 | — | — | 428,902 | |||||||||||||||||||
Special charges | 61,318 | — | — | 61,318 | |||||||||||||||||||
2,351,567 | — | (760) | 2,350,807 | ||||||||||||||||||||
Operating income | 1,881,735 | 16,797 | 1,057 | 1,899,589 | |||||||||||||||||||
Nonoperating expense (income): | |||||||||||||||||||||||
Interest expense | 253,589 | — | — | 253,589 | |||||||||||||||||||
Interest income | (9,383) | — | — | (9,383) | |||||||||||||||||||
Other, net | (988) | — | 1,057 | 69 | |||||||||||||||||||
243,218 | — | 1,057 | 244,275 | ||||||||||||||||||||
Income before income taxes | 1,638,517 | 16,797 | — | 1,655,314 | |||||||||||||||||||
Provision for income taxes | 143,085 | 5,249 | — | 148,334 | |||||||||||||||||||
Net income | $ | 1,495,432 | $ | 11,548 | $ | — | $ | 1,506,980 | |||||||||||||||
Shares used to compute earnings per common share – basic | 370,430 | — | — | 370,430 | |||||||||||||||||||
Shares used to compute earnings per common share – diluted | 374,938 | — | — | 374,938 | |||||||||||||||||||
Basic earnings per common share | $ | 4.02 | $ | 0.03 | $ | — | $ | 4.05 | |||||||||||||||
Diluted earnings per common share | $ | 3.97 | $ | 0.03 | $ | — | $ | 4.00 |
November 3, 2018 | |||||||||||||||||
As Reported | Impact of Adoption of ASU 2014-09 | As Adjusted | |||||||||||||||
Deferred tax assets | $ | 21,078 | $ | (11,413) | $ | 9,665 | |||||||||||
Deferred income on shipments to distributors, net | $ | 487,417 | $ | (487,417) | $ | — | |||||||||||
Accrued liabilities | $ | 497,080 | $ | 133,027 | $ | 630,107 | |||||||||||
Deferred income taxes | $ | 927,065 | $ | 63,344 | $ | 990,409 | |||||||||||
Retained earnings | $ | 5,703,064 | $ | 279,633 | $ | 5,982,697 |
November 4, 2018 | |||||||||||||||||
Beginning Balance November 3, 2018 as Adjusted | Impact of Adoption of ASU 2016-16 | Balance November 4, 2018 | |||||||||||||||
Deferred tax assets | $ | 9,665 | $ | 1,655,129 | $ | 1,664,794 | |||||||||||
Deferred income taxes | $ | 990,409 | $ | 1,324,103 | $ | 2,314,512 | |||||||||||
Retained earnings | $ | 5,982,697 | $ | 331,026 | $ | 6,313,723 |
2020 | 2019 | ||||||||||
Cash | $ | 239,607 | $ | 152,432 | |||||||
Available-for-sale | 816,253 | 416,890 | |||||||||
Held-to-maturity | — | 79,000 | |||||||||
Total cash and cash equivalents | $ | 1,055,860 | $ | 648,322 | |||||||
2020 | 2019 | 2018 | |||||||||||||||
Cash paid during the fiscal year for: | |||||||||||||||||
Income taxes | $ | 237,691 | $ | 205,762 | $ | 211,473 | |||||||||||
Interest | $ | 185,854 | $ | 216,143 | $ | 233,436 |
2020 | 2019 | ||||||||||
Raw materials | $ | 33,806 | $ | 35,447 | |||||||
Work in process | 443,690 | 400,409 | |||||||||
Finished goods | 130,764 | 174,030 | |||||||||
Total inventories | $ | 608,260 | $ | 609,886 | |||||||
Buildings |
Up to 30 years
|
||||
Machinery & equipment |
3-10 years
|
||||
Office equipment |
3-10 years
|
||||
Leasehold improvements |
7-20 years
|
October 31, 2020 | |||||
Land and buildings | $ | 36,451 | |||
Machinery and equipment | 1,468 | ||||
Office equipment | 197 | ||||
Leasehold improvements | 5,744 | ||||
43,860 | |||||
Less accumulated depreciation and amortization | (21,706) | ||||
Net property, plant and equipment reclassified to Prepaid expenses and other current assets | $ | 22,154 | |||
2020 | 2019 | ||||||||||
Balance at beginning of year | $ | 12,256,880 | $ | 12,252,604 | |||||||
Goodwill related to other acquisitions (1) | 17,839 | 6,702 | |||||||||
Foreign currency translation adjustment | 3,706 | (2,426) | |||||||||
Balance at end of year | $ | 12,278,425 | $ | 12,256,880 |
October 31, 2020 | November 2, 2019 | ||||||||||||||||||||||
Gross Carrying
Amount |
Accumulated
Amortization |
Gross Carrying
Amount |
Accumulated
Amortization |
||||||||||||||||||||
Customer relationships | $ | 4,700,454 | $ | 1,703,299 | $ | 4,696,562 | $ | 1,284,256 | |||||||||||||||
Technology-based | 1,136,742 | 518,328 | 1,145,283 | 385,618 | |||||||||||||||||||
Trade-name | 72,200 | 37,489 | 73,417 | 28,164 | |||||||||||||||||||
Total (1) (2)
|
$ | 5,909,396 | $ | 2,259,116 | $ | 5,915,262 | $ | 1,698,038 |
Fiscal Year | Amortization Expense | ||||
2021 | $ | 580,984 | |||
2022 | $ | 573,950 | |||
2023 | $ | 547,397 | |||
2024 | $ | 485,496 | |||
2025 | $ | 395,300 |
Fair Value At | |||||||||||||||||
Balance Sheet Location | October 31, 2020 | November 2, 2019 | |||||||||||||||
Forward foreign currency exchange contracts | Prepaid expenses and other current assets | $ | 5,550 | $ | 65 | ||||||||||||
October 31, 2020 | November 2, 2019 | ||||||||||
Gross amount of recognized assets | $ | 6,114 | $ | 2,828 | |||||||
Gross amounts of recognized liabilities offset in the Consolidated Balance Sheets | (687) | (2,828) | |||||||||
Net assets presented in the Consolidated Balance Sheets | $ | 5,427 | $ | — |
October 31, 2020 | |||||||||||||||||||||||
Fair Value measurement at
Reporting Date using: |
|||||||||||||||||||||||
Quoted
Prices in Active Markets for Identical Assets (Level 1) |
Significant
Other Observable Inputs (Level 2) |
Total | |||||||||||||||||||||
Assets | |||||||||||||||||||||||
Cash equivalents: | |||||||||||||||||||||||
Available-for-sale: | |||||||||||||||||||||||
Government and institutional money market funds | $ | 816,253 | $ | — | $ | 816,253 | |||||||||||||||||
Other assets: | |||||||||||||||||||||||
Forward foreign currency exchange contracts (1) | — | 5,427 | 5,427 | ||||||||||||||||||||
Deferred compensation investments | 52,956 | — | 52,956 | ||||||||||||||||||||
Total assets measured at fair value | $ | 869,209 | $ | 5,427 | $ | 874,636 | |||||||||||||||||
Liabilities | |||||||||||||||||||||||
Interest rate derivatives | — | 214,586 | 214,586 | ||||||||||||||||||||
Total liabilities measured at fair value | $ | — | $ | 214,586 | $ | 214,586 |
November 2, 2019 | |||||||||||||||||||||||
Fair Value measurement at
Reporting Date using: |
|||||||||||||||||||||||
Quoted
Prices in Active Markets for Identical Assets (Level 1) |
Significant
Other Observable Inputs (Level 2) |
Total | |||||||||||||||||||||
Assets | |||||||||||||||||||||||
Cash equivalents: | |||||||||||||||||||||||
Available-for-sale: | |||||||||||||||||||||||
Government and institutional money market funds | $ | 416,890 | $ | — | $ | 416,890 | |||||||||||||||||
Other assets: | |||||||||||||||||||||||
Deferred compensation investments | 48,302 | — | 48,302 | ||||||||||||||||||||
Total assets measured at fair value | $ | 465,192 | $ | — | $ | 465,192 | |||||||||||||||||
Liabilities | |||||||||||||||||||||||
Interest rate derivatives | — | 138,798 | 138,798 | ||||||||||||||||||||
Total liabilities measured at fair value | $ | — | $ | 138,798 | $ | 138,798 |
October 31, 2020 | November 2, 2019 | ||||||||||||||||||||||||||||||||||
Principal Amount Outstanding | Fair Value | Principal Amount Outstanding | Fair Value | ||||||||||||||||||||||||||||||||
3-Year term loan, due March 2022 | $ | 925,000 | $ | 925,000 | $ | 925,000 | $ | 925,000 | |||||||||||||||||||||||||||
2020 Notes, due March 2020 | — | — | 300,000 | 300,872 | |||||||||||||||||||||||||||||||
2021 Notes, due January 2021 | — | — | 450,000 | 454,634 | |||||||||||||||||||||||||||||||
2021 Notes, due December 2021 | 400,000 | 408,565 | 400,000 | 402,591 | |||||||||||||||||||||||||||||||
2023 Notes, due June 2023 | 500,000 | 526,855 | 500,000 | 511,190 | |||||||||||||||||||||||||||||||
2023 Notes, due December 2023 | 550,000 | 590,177 | 550,000 | 567,159 | |||||||||||||||||||||||||||||||
2025 Notes, due April 2025 | 400,000 | 434,919 | — | — | |||||||||||||||||||||||||||||||
2025 Notes, due December 2025 | 850,000 | 969,033 | 850,000 | 914,567 | |||||||||||||||||||||||||||||||
2026 Notes, due December 2026 | 900,000 | 1,017,505 | 900,000 | 940,192 | |||||||||||||||||||||||||||||||
2036 Notes, due December 2036 | 250,000 | 298,153 | 250,000 | 270,891 | |||||||||||||||||||||||||||||||
2045 Notes, due December 2045 | 400,000 | 538,788 | 400,000 | 491,439 | |||||||||||||||||||||||||||||||
Total Debt | $ | 5,175,000 | $ | 5,708,995 | $ | 5,525,000 | $ | 5,778,535 |
Foreign currency translation adjustment | Unrealized holding gains (losses) on derivatives | Pension plans | Total | ||||||||||||||||||||||||||||||||
November 2, 2019 | $ | (30,076) | $ | (118,015) | $ | (39,708) | $ | (187,799) | |||||||||||||||||||||||||||
Other comprehensive (loss) income before reclassifications | 3,224 | (68,905) | (7,681) | (73,362) | |||||||||||||||||||||||||||||||
Amounts reclassified out of other comprehensive loss | — | (681) | 2,617 | 1,936 | |||||||||||||||||||||||||||||||
Tax | — | 17,310 | (5,167) | 12,143 | |||||||||||||||||||||||||||||||
Other comprehensive (loss) income | 3,224 | (52,276) | (10,231) | (59,283) | |||||||||||||||||||||||||||||||
Effect of Accounting Standards Update 2018-02
|
— | (2,379) | — | (2,379) | |||||||||||||||||||||||||||||||
October 31, 2020 | $ | (26,852) | $ | (172,670) | $ | (49,939) | $ | (249,461) |
Comprehensive Income Component | 2020 | 2019 | Location | |||||||||||||||||||||||
Unrealized holding gains (losses) on derivatives | ||||||||||||||||||||||||||
Currency forwards | $ | (2,522) | $ | 1,736 | Cost of sales | |||||||||||||||||||||
(127) | 2,956 | Research and development | ||||||||||||||||||||||||
112 | 3,056 | Selling, marketing, general and administrative | ||||||||||||||||||||||||
Interest rate derivatives | 1,856 | 1,437 | Interest expense | |||||||||||||||||||||||
(681) | 9,185 | Total before tax | ||||||||||||||||||||||||
(158) | (1,518) | Tax | ||||||||||||||||||||||||
Effect of Accounting Standards Update 2018-02
|
(2,379) | — | Retained earnings | |||||||||||||||||||||||
$ | (3,218) | $ | 7,667 | Net of tax | ||||||||||||||||||||||
Amortization of pension components included in the computation of net periodic benefit cost | ||||||||||||||||||||||||||
Actuarial losses | 2,617 | 1,004 | (1) | |||||||||||||||||||||||
651 | (248) | Tax | ||||||||||||||||||||||||
$ | 3,268 | $ | 756 | Net of tax | ||||||||||||||||||||||
Total amounts reclassified out of AOCI, net of tax | $ | 50 | $ | 8,423 |
2020 | 2019 | 2018 (1) | |||||||||||||||
Net income | $ | 1,220,761 | $ | 1,363,011 | $ | 1,506,980 | |||||||||||
Less: income allocated to participating securities (2) | — | 3,229 | 5,909 | ||||||||||||||
Net income allocated to common shareholders | $ | 1,220,761 | $ | 1,359,782 | $ | 1,501,071 | |||||||||||
Basic shares: | |||||||||||||||||
Weighted-average shares outstanding | 368,633 | 369,133 | 370,430 | ||||||||||||||
Earnings per common share basic | $ | 3.31 | $ | 3.68 | $ | 4.05 | |||||||||||
Diluted shares: | |||||||||||||||||
Weighted-average shares outstanding | 368,633 | 369,133 | 370,430 | ||||||||||||||
Assumed exercise of common stock equivalents | 3,340 | 3,738 | 4,508 | ||||||||||||||
Weighted-average common and common equivalent shares | 371,973 | 372,871 | 374,938 | ||||||||||||||
Earnings per common share diluted | $ | 3.28 | $ | 3.65 | $ | 4.00 | |||||||||||
Anti-dilutive shares related to: | |||||||||||||||||
Outstanding stock options | 460 | 826 | 1,649 |
2020 | 2019 | 2018 | |||||||||||||||
Options granted (in thousands) | 359 | 454 | 603 | ||||||||||||||
Weighted-average exercise price | $94.41 | $107.11 | $90.98 | ||||||||||||||
Weighted-average grant-date fair value | $18.81 | $23.29 | $20.82 | ||||||||||||||
Assumptions: | |||||||||||||||||
Weighted-average expected volatility | 29.5 | % | 26.4 | % | 27.7 | % | |||||||||||
Weighted-average expected term (in years) | 5.0 | 5.0 | 5.0 | ||||||||||||||
Weighted-average risk-free interest rate | 0.7 | % | 2.4 | % | 2.6 | % | |||||||||||
Weighted-average expected dividend yield | 2.6 | % | 2.0 | % | 2.1 | % |
2020 | 2019 | 2018 | ||||||||||||||||||
Cost of sales | $ | 17,684 | $ | 20,628 | $ | 18,733 | ||||||||||||||
Research and development | 73,366 | 75,305 | 81,444 | |||||||||||||||||
Selling, marketing, general and administrative | 56,838 | 51,829 | 50,988 | |||||||||||||||||
Special charges | 1,630 | 2,538 | — | |||||||||||||||||
Total stock-based compensation expense | $ | 149,518 | $ | 150,300 | $ | 151,165 |
Options
Outstanding (in thousands) |
Weighted-
Average Exercise Price Per Share |
Weighted-
Average Remaining Contractual Term in Years |
Aggregate
Intrinsic Value |
||||||||||||||||||||
Options outstanding at November 2, 2019
|
5,183 | $65.97 | |||||||||||||||||||||
Options granted | 359 | $94.41 | |||||||||||||||||||||
Options exercised | (1,221) | $56.02 | |||||||||||||||||||||
Options forfeited | (129) | $82.70 | |||||||||||||||||||||
Options outstanding at October 31, 2020
|
4,192 | $70.73 | 5.8 | $200,398 | |||||||||||||||||||
Options exercisable at October 31, 2020
|
2,677 | $61.23 | 4.7 | $153,408 | |||||||||||||||||||
Options vested or expected to vest at October 31, 2020 (1)
|
4,109 | $70.29 | 5.7 | $198,237 |
Restricted
Stock Units/Awards Outstanding (in thousands) |
Weighted-
Average Grant- Date Fair Value Per Share |
||||||||||
Restricted stock units/awards outstanding at November 2, 2019
|
4,396 | $87.18 | |||||||||
Units/Awards granted | 1,413 | $97.44 | |||||||||
Restrictions lapsed | (1,876) | $85.41 | |||||||||
Forfeited | (296) | $89.45 | |||||||||
Restricted stock units/awards outstanding at October 31, 2020
|
3,637 | $91.54 |
2020 | 2019 | 2018 (1) | |||||||||||||||||||||||||||||||||||||||
Revenue |
% of
Total Revenue (2) |
Revenue |
% of
Total Revenue (2) |
Revenue |
% of
Total Revenue (2) |
||||||||||||||||||||||||||||||||||||
Industrial | $ | 2,987,542 | 53 | % | $ | 3,011,411 | 50 | % | $ | 3,143,566 | 51 | % | |||||||||||||||||||||||||||||
Communications | 1,195,946 | 21 | % | 1,294,960 | 22 | % | 1,155,826 | 19 | % | ||||||||||||||||||||||||||||||||
Automotive | 779,276 | 14 | % | 930,613 | 16 | % | 1,006,886 | 16 | % | ||||||||||||||||||||||||||||||||
Consumer | 640,292 | 11 | % | 754,081 | 13 | % | 918,411 | 15 | % | ||||||||||||||||||||||||||||||||
Total revenue | $ | 5,603,056 | 100 | % | $ | 5,991,065 | 100 | % | $ | 6,224,689 | 100 | % |
2020 | 2019 | 2018 (1) | ||||||||||||||||||||||||||||||||||||
Revenue |
% of
Total Revenue (2) |
Revenue |
% of
Total Revenue (2) |
Revenue |
% of
Total Revenue (2) |
|||||||||||||||||||||||||||||||||
Distributors | $ | 3,216,302 | 57 | % | $ | 3,409,161 | 57 | % | $ | 3,424,145 | 55 | % | ||||||||||||||||||||||||||
Direct customers | 2,300,493 | 41 | % | 2,506,065 | 42 | % | 2,721,885 | 44 | % | |||||||||||||||||||||||||||||
Other | 86,261 | 2 | % | 75,839 | 1 | % | 78,659 | 1 | % | |||||||||||||||||||||||||||||
Total revenue | $ | 5,603,056 | 100 | % | $ | 5,991,065 | 100 | % | $ | 6,224,689 | 100 | % |
2020 | 2019 | 2018 (1) | |||||||||||||||
Revenue | |||||||||||||||||
United States | $ | 1,887,443 | $ | 2,020,886 | $ | 2,277,084 | |||||||||||
Rest of North and South America | 41,250 | 55,059 | 46,276 | ||||||||||||||
Europe | 1,245,695 | 1,374,673 | 1,405,686 | ||||||||||||||
Japan | 521,720 | 657,632 | 714,846 | ||||||||||||||
China | 1,348,011 | 1,316,275 | 1,215,949 | ||||||||||||||
Rest of Asia | 558,937 | 566,540 | 564,848 | ||||||||||||||
Subtotal all foreign countries | 3,715,613 | 3,970,179 | 3,947,605 | ||||||||||||||
Total revenue | $ | 5,603,056 | $ | 5,991,065 | $ | 6,224,689 | |||||||||||
Property, plant and equipment | |||||||||||||||||
United States | $ | 579,755 | $ | 592,591 | $ | 505,646 | |||||||||||
Ireland | 169,968 | 184,791 | 202,611 | ||||||||||||||
Philippines | 256,470 | 247,823 | 260,355 | ||||||||||||||
Singapore (2) | 18,518 | 88,385 | 80,383 | ||||||||||||||
Malaysia | 53,616 | 56,292 | 57,514 | ||||||||||||||
All other countries | 42,234 | 50,107 | 47,819 | ||||||||||||||
Subtotal all foreign countries | 540,806 | 627,398 | 648,682 | ||||||||||||||
Total property, plant and equipment | $ | 1,120,561 | $ | 1,219,989 | $ | 1,154,328 |
Accrued Special Charges | Closure of Manufacturing Facilities | Repositioning Action | Other Actions | ||||||||||||||||||||||||||
Balance at October 28, 2017 | $ | — | $ | — | $ | 37,348 | |||||||||||||||||||||||
Fiscal 2018 special charges, net | 44,452 | — | 16,866 | ||||||||||||||||||||||||||
Severance and other payments | — | — | (39,099) | ||||||||||||||||||||||||||
Effect of foreign currency on accrual | (1,478) | — | 37 | ||||||||||||||||||||||||||
Balance at November 3, 2018 | $ | 42,974 | $ | — | $ | 15,152 | |||||||||||||||||||||||
Fiscal 2019 special charges, net | 7,556 | 88,103 | — | ||||||||||||||||||||||||||
Severance and other payments | — | (12,487) | (9,634) | ||||||||||||||||||||||||||
Non-cash impairment charge | — | (14,167) | — | ||||||||||||||||||||||||||
Non-cash accelerated stock based compensation charges | — | (2,538) | — | ||||||||||||||||||||||||||
Effect of foreign currency on accrual | (129) | (16) | 5 | ||||||||||||||||||||||||||
Balance at November 2, 2019 | $ | 50,401 | $ | 58,895 | $ | 5,523 | |||||||||||||||||||||||
Fiscal 2020 special charges, net | 2,918 | 49,419 | — | ||||||||||||||||||||||||||
Severance and other payments | (8,113) | (85,957) | (2,034) | ||||||||||||||||||||||||||
Non-cash impairment charge | — | — | — | ||||||||||||||||||||||||||
Non-cash accelerated stock based compensation charges | — | (1,630) | — | ||||||||||||||||||||||||||
Effect of foreign currency on accrual | (30) | 47 | — | ||||||||||||||||||||||||||
Balance at October 31, 2020 | $ | 45,176 | $ | 20,774 | $ | 3,489 | |||||||||||||||||||||||
Accrued liabilities | $ | 45,176 | $ | 20,774 | $ | 3,489 | |||||||||||||||||||||||
2020 | 2019 | ||||||||||
Distributor price adjustments and other revenue reserves | $ | 257,343 | $ | 227,020 | |||||||
Accrued compensation and benefits | 203,675 | 168,471 | |||||||||
Interest rate swap | 214,586 | 138,798 | |||||||||
Accrued interest | 56,083 | 61,255 | |||||||||
Accrued special charges | 69,439 | 64,418 | |||||||||
Other | 154,507 | 135,854 | |||||||||
Total accrued liabilities | $ | 955,633 | $ | 795,816 |
October 31, 2020 | |||||
Assets | |||||
Operating lease right-of-use assets in Other assets
|
$ | 256,625 | |||
Liabilities | |||||
Operating lease liabilities in Accrued liabilities
|
$ | 39,923 | |||
Operating lease liabilities in Other non-current liabilities
|
$ | 288,492 |
October 31, 2020 | |||||||||||
Lease expense | $ | 45,892 | |||||||||
Cash paid for amounts included in the measurement of operating lease liabilities | |||||||||||
Operating cash flows from operating leases | $ | 47,243 | |||||||||
Lease assets obtained in exchange for new lease liabilities | $ | 54,392 | |||||||||
Weighted average remaining lease term | 9.2 years | ||||||||||
Weighted average discount rate | 3.1% |
Fiscal year | Operating Leases | ||||
2021 | $ | 49,526 | |||
2022 | 43,834 | ||||
2023 | 39,204 | ||||
2024 | 38,335 | ||||
2025 | 36,235 | ||||
Thereafter | 173,709 | ||||
Total future minimum operating lease payments | 380,843 | ||||
Less: imputed interest | (52,428) | ||||
Present value of operating lease liabilities | $ | 328,415 |
2020 | 2019 | 2018 | |||||||||||||||
Service cost | $ | 8,587 | $ | 5,578 | $ | 6,891 | |||||||||||
Interest cost | 3,917 | 4,079 | 3,984 | ||||||||||||||
Expected return on plan assets | (5,296) | (5,279) | (4,559) | ||||||||||||||
Amortization of prior service cost | — | 3 | 1 | ||||||||||||||
Amortization of transition obligation | — | — | 10 | ||||||||||||||
Recognized actuarial loss | 2,583 | 1,000 | 1,621 | ||||||||||||||
Subtotal | $ | 9,791 | $ | 5,381 | $ | 7,948 | |||||||||||
Curtailment impact | (203) | — | — | ||||||||||||||
Net periodic benefit cost | $ | 9,588 | $ | 5,381 | $ | 7,948 |
2020 | 2019 | ||||||||||
Change in Benefit Obligation | |||||||||||
Benefit obligation at beginning of year | $ | 169,648 | $ | 123,538 | |||||||
Service cost | 8,587 | 5,578 | |||||||||
Interest cost | 3,917 | 4,079 | |||||||||
Curtailment | (705) | — | |||||||||
Actuarial loss | 2,916 | 38,210 | |||||||||
Benefits paid | (2,661) | (3,053) | |||||||||
Exchange rate adjustment | 5,033 | 1,296 | |||||||||
Benefit obligation at end of year | $ | 186,735 | $ | 169,648 | |||||||
Change in Plan Assets | |||||||||||
Fair value of plan assets at beginning of year | $ | 99,939 | $ | 84,655 | |||||||
Actual return on plan assets | 1,366 | 12,389 | |||||||||
Employer contributions | 6,943 | 4,177 | |||||||||
Benefits paid | (2,661) | (3,053) | |||||||||
Exchange rate adjustment | 1,918 | 1,771 | |||||||||
Fair value of plan assets at end of year | $ | 107,505 | $ | 99,939 | |||||||
Reconciliation of Funded Status | |||||||||||
Funded status | $ | (79,230) | $ | (69,709) | |||||||
Amounts Recognized in the Balance Sheet | |||||||||||
Current liabilities | $ | (973) | $ | (846) | |||||||
Non-current liabilities | (78,257) | (68,863) | |||||||||
Net amount recognized | $ | (79,230) | $ | (69,709) |
2020 | 2019 | ||||||||||
Reconciliation of Amounts Recognized in the Statement of Financial Position | |||||||||||
Prior service credit | (44) | (44) | |||||||||
Net loss | (55,942) | (50,878) | |||||||||
Accumulated other comprehensive loss | (55,986) | (50,922) | |||||||||
Accumulated contributions less than net periodic benefit cost | (23,244) | (18,787) | |||||||||
Net amount recognized | $ | (79,230) | $ | (69,709) | |||||||
Changes Recognized in Other Comprehensive Income (Loss) | |||||||||||
Changes in plan assets and benefit obligations recognized in other comprehensive income (loss) | |||||||||||
Net loss arising during the year | $ | 6,342 | $ | 31,100 | |||||||
Effect of exchange rates on amounts included in AOCI | 1,305 | (18) | |||||||||
Amounts recognized as a component of net periodic benefit cost | |||||||||||
Amortization or settlement recognition of net loss | (2,583) | (1,004) | |||||||||
Total recognized in other comprehensive loss | $ | 5,064 | $ | 30,078 | |||||||
Total recognized in net periodic cost and other comprehensive loss | $ | 14,652 | $ | 35,459 | |||||||
Estimated amounts that will be amortized from AOCI over the next fiscal year | |||||||||||
Net Loss | $ | (2,845) | $ | (2,583) |
2020 | 2019 | ||||||||||
Plans with projected benefit obligations in excess of plan assets: | |||||||||||
Projected benefit obligation | $ | 186,735 | $ | 169,648 | |||||||
Fair value of plan assets | $ | 107,505 | $ | 99,939 | |||||||
Plans with accumulated benefit obligations in excess of plan assets: | |||||||||||
Projected benefit obligation | $ | 141,982 | $ | 61,019 | |||||||
Accumulated benefit obligation | $ | 132,517 | $ | 54,318 | |||||||
Fair value of plan assets | $ | 69,250 | $ | 1,305 |
2020 | 2019 | ||||||||||
Discount rate | 2.15 | % | 2.45 | % | |||||||
Rate of increase in compensation levels | 3.19 | % | 3.38 | % |
2020 | 2019 | ||||||||||
Discount rate | 2.45 | % | 3.53 | % | |||||||
Expected long-term return on plan assets | 5.22 | % | 6.16 | % | |||||||
Rate of increase in compensation levels | 3.38 | % | 3.26 | % |
October 31, 2020 | November 2, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurement at Reporting Date Using: | Fair Value Measurement at Reporting Date Using: | ||||||||||||||||||||||||||||||||||||||||||||||
Quoted Prices in Active Markets for Identical Assets
(Level 1) |
Significant Other Observable Inputs
(Level 2) |
Total |
Quoted Prices in Active Markets for Identical Assets
(Level 1) |
Significant Other Observable Inputs
(Level 2) |
Total | ||||||||||||||||||||||||||||||||||||||||||
Unit trust funds(1) | $ | — | $ | 5,510 | $ | 5,510 | $ | — | $ | 4,736 | $ | 4,736 | |||||||||||||||||||||||||||||||||||
Equities(1) | 7,134 | 12,733 | 19,867 | 6,114 | 39,189 | 45,303 | |||||||||||||||||||||||||||||||||||||||||
Fixed income securities(2) | — | 24,636 | 24,636 | — | 48,274 | 48,274 | |||||||||||||||||||||||||||||||||||||||||
Property (3) | — | 8,034 | 8,034 | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Investment Funds (4) | — | 21,960 | 21,960 | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Cash and cash equivalents | 27,498 | — | 27,498 | 1,626 | — | 1,626 | |||||||||||||||||||||||||||||||||||||||||
Total assets measured at fair value | $ | 34,632 | $ | 72,873 | $ | 107,505 | $ | 7,740 | $ | 92,199 | $ | 99,939 |
Expected Company Contributions | |||||
2021 | $ | 6,985 | |||
Expected Benefit Payments | |||||
2022 | $ | 3,344 | |||
2023 | $ | 2,906 | |||
2024 | $ | 3,260 | |||
2025 | $ | 3,359 | |||
2026 | $ | 3,926 | |||
2027 through 2031 | $ | 27,481 |
2020 | 2019 | 2018 (1) | |||||||||||||||
U.S. federal statutory tax rate | 21.0 | % | 21.0 | % | 23.4 | % | |||||||||||
Income tax provision reconciliation: | |||||||||||||||||
Tax at statutory rate | $ | 275,439 | $ | 312,003 | $ | 387,343 | |||||||||||
Net foreign income subject to lower tax rate | (225,937) | (242,893) | (420,756) | ||||||||||||||
State income taxes, net of federal benefit | (23,537) | (31,265) | 4,428 | ||||||||||||||
Valuation allowance | 13,655 | 34,069 | 2,232 | ||||||||||||||
Federal research and development tax credits | (31,055) | (50,769) | (33,602) | ||||||||||||||
Change in uncertain tax positions | (13,304) | 7,233 | (32,945) | ||||||||||||||
Amortization of purchased intangibles | 101,906 | 111,547 | 213,198 | ||||||||||||||
Taxes attributable to the Tax Cuts and Jobs Act of 2017 | — | (7,500) | 56,608 | ||||||||||||||
U.S. effects of international operations | 11,903 | 19,782 | — | ||||||||||||||
Windfalls (under ASU 2016-09) | (16,240) | (28,677) | (26,237) | ||||||||||||||
Other, net | (1,974) | (813) | (1,935) | ||||||||||||||
Total income tax provision | $ | 90,856 | $ | 122,717 | $ | 148,334 |
Income before income taxes (1) | 2020 | 2019 | 2018 (2) | ||||||||||||||
Domestic | $ | 355,442 | $ | 484,876 | $ | 615,238 | |||||||||||
Foreign | 956,175 | 1,000,852 | 1,040,076 | ||||||||||||||
Income before income taxes | $ | 1,311,617 | $ | 1,485,728 | $ | 1,655,314 |
2020 | 2019 | 2018 (1) | |||||||||||||||
Current: | |||||||||||||||||
Federal tax | $ | 64,876 | $ | 74,049 | $ | 824,848 | |||||||||||
State | 4,882 | 2 | 6,043 | ||||||||||||||
Foreign | 135,046 | 139,919 | 47,819 | ||||||||||||||
Total current | $ | 204,804 | $ | 213,970 | $ | 878,710 | |||||||||||
Deferred: | |||||||||||||||||
Federal | $ | (159,229) | $ | (158,472) | $ | (738,163) | |||||||||||
State | (12,684) | (3,627) | 1,092 | ||||||||||||||
Foreign | 57,965 | 70,846 | 6,695 | ||||||||||||||
Total deferred | $ | (113,948) | $ | (91,253) | $ | (730,376) | |||||||||||
Provision for income tax | $ | 90,856 | $ | 122,717 | $ | 148,334 |
2020 | 2019 | ||||||||||
Deferred tax assets: | |||||||||||
Inventory reserves | $ | 17,074 | $ | 21,081 | |||||||
Reserves for compensation and benefits | 54,428 | 53,090 | |||||||||
Tax credit carryovers | 163,507 | 133,485 | |||||||||
Stock-based compensation | 12,758 | 63,589 | |||||||||
Net operating losses | 8,546 | 5,299 | |||||||||
Intra-entity transfer of intangible assets | 1,479,944 | 1,567,536 | |||||||||
Lease liability | 55,250 | — | |||||||||
Other | 159,838 | 70,974 | |||||||||
Total gross deferred tax assets | 1,951,345 | 1,915,054 | |||||||||
Valuation allowance | (154,130) | (116,349) | |||||||||
Total deferred tax assets | 1,797,215 | 1,798,705 | |||||||||
Deferred tax liabilities: | |||||||||||
Depreciation | (7,409) | (38,464) | |||||||||
Deferred GILTI tax liabilities | (1,183,955) | (1,254,029) | |||||||||
Right of use asset | (51,055) | — | |||||||||
Acquisition-related intangible | (971,327) | (1,012,042) | |||||||||
Total gross deferred tax liabilities | (2,213,746) | (2,304,535) | |||||||||
Net deferred tax liabilities | $ | (416,531) | $ | (505,830) |
Unrealized Tax Benefits | |||||
Balance, October 28, 2017 | $ | 37,857 | |||
Additions for tax positions related to current year | 1,334 | ||||
Reductions for tax positions related to prior years | (295) | ||||
Reductions due to lapse of applicable statute of limitations | (25,640) | ||||
Balance, November 3, 2018 | $ | 13,256 | |||
Additions for tax positions related to current year | 3,398 | ||||
Additions for tax positions related to prior years | 18,613 | ||||
Reductions due to lapse of applicable statute of limitations | (924) | ||||
Balance, November 2, 2019 | $ | 34,343 | |||
Additions for tax positions related to current year | 3,270 | ||||
Reductions for tax positions related to prior years | (16,152) | ||||
Reductions due to lapse of applicable statute of limitations | (170) | ||||
Balance, October 31, 2020 | $ | 21,291 |
October 31, 2020 | November 2, 2019 | ||||||||||||||||||||||
Principal | Unamortized discount and debt issuance costs | Principal | Unamortized discount and debt issuance costs | ||||||||||||||||||||
3-Year term loan, due March 2022 | $ | 925,000 | $ | — | $ | 925,000 | $ | — | |||||||||||||||
2021 Notes, due January 2021 | — | — | 450,000 | 1,819 | |||||||||||||||||||
2021 Notes, due December 2021 | 400,000 | 1,009 | 400,000 | 1,918 | |||||||||||||||||||
2023 Notes, due June 2023 | 500,000 | 1,589 | 500,000 | 2,200 | |||||||||||||||||||
2023 Notes, due December 2023 | 550,000 | 2,741 | 550,000 | 3,619 | |||||||||||||||||||
2025 Notes, due April 2025 | 400,000 | 3,916 | — | — | |||||||||||||||||||
2025 Notes, due December 2025 | 850,000 | 4,504 | 850,000 | 5,382 | |||||||||||||||||||
2026 Notes, due December 2026 | 900,000 | 7,813 | 900,000 | 9,086 | |||||||||||||||||||
2036 Notes, due December 2036 | 250,000 | 3,375 | 250,000 | 3,576 | |||||||||||||||||||
2045 Notes, due December 2045 | 400,000 | 4,951 | 400,000 | 5,148 | |||||||||||||||||||
Total Long-Term Debt | $ | 5,175,000 | $ | 29,898 | $ | 5,225,000 | $ | 32,748 | |||||||||||||||
2020 Notes, due March 2020 | — | — | 300,000 | 333 | |||||||||||||||||||
Total Current Debt | $ | — | $ | — | $ | 300,000 | $ | 333 | |||||||||||||||
Total Debt | $ | 5,175,000 | $ | 29,898 | $ | 5,525,000 | $ | 33,081 |
4Q20 | 3Q20 | 2Q20 | 1Q20 | 4Q19 | 3Q19 | 2Q19 | 1Q19 | |||||||||||||||||||||||||||||||||||||||||||
Revenue | $ | 1,526,295 | $ | 1,456,136 | $ | 1,317,060 | $ | 1,303,565 | $ | 1,443,219 | $ | 1,480,143 | $ | 1,526,602 | $ | 1,541,101 | ||||||||||||||||||||||||||||||||||
Cost of sales | 503,211 | 483,558 | 470,386 | 455,423 | 501,028 | 482,332 | 492,510 | 501,445 | ||||||||||||||||||||||||||||||||||||||||||
Gross margin | 1,023,084 | 972,578 | 846,674 | 848,142 | 942,191 | 997,811 | 1,034,092 | 1,039,656 | ||||||||||||||||||||||||||||||||||||||||||
% of Revenue | 67 | % | 67 | % | 64 | % | 65 | % | 65 | % | 67 | % | 68 | % | 67 | % | ||||||||||||||||||||||||||||||||||
Research and development | 280,239 | 260,794 | 252,413 | 257,073 | 277,018 | 280,102 | 285,846 | 287,382 | ||||||||||||||||||||||||||||||||||||||||||
Selling, marketing, general and administrative | 165,115 | 153,753 | 141,775 | 199,280 | 154,799 | 162,825 | 163,128 | 167,342 | ||||||||||||||||||||||||||||||||||||||||||
Special charges (1) | 8,051 | 31,830 | 1,320 | 11,136 | 64,788 | 927 | 8,162 | 21,782 | ||||||||||||||||||||||||||||||||||||||||||
Amortization of intangibles | 108,007 | 107,077 | 107,146 | 107,225 | 107,225 | 107,231 | 107,261 | 107,324 | ||||||||||||||||||||||||||||||||||||||||||
Total operating expenses | 561,412 | 553,454 | 502,654 | 574,714 | 603,830 | 551,085 | 564,397 | 583,830 | ||||||||||||||||||||||||||||||||||||||||||
Operating income | 461,672 | 419,124 | 344,020 | 273,428 | 338,361 | 446,726 | 469,695 | 455,826 | ||||||||||||||||||||||||||||||||||||||||||
% of Revenue | 30 | % | 29 | % | 26 | % | 21 | % | 23 | % | 30 | % | 31 | % | 30 | % | ||||||||||||||||||||||||||||||||||
Nonoperating (income) expenses: | ||||||||||||||||||||||||||||||||||||||||||||||||||
Interest expense | 48,593 | 45,914 | 49,985 | 48,813 | 50,775 | 59,871 | 59,701 | 58,728 | ||||||||||||||||||||||||||||||||||||||||||
Interest income | (527) | (504) | (1,334) | (1,940) | (1,988) | (2,625) | (2,928) | (2,688) | ||||||||||||||||||||||||||||||||||||||||||
Other, net | (3,704) | 685 | 308 | 338 | 1,747 | (78) | 4,525 | (160) | ||||||||||||||||||||||||||||||||||||||||||
Total nonoperating (income) expense | 44,362 | 46,095 | 48,959 | 47,211 | 50,534 | 57,168 | 61,298 | 55,880 | ||||||||||||||||||||||||||||||||||||||||||
Income before income taxes | 417,310 | 373,029 | 295,061 | 226,217 | 287,827 | 389,558 | 408,397 | 399,946 | ||||||||||||||||||||||||||||||||||||||||||
% of Revenue | 27 | % | 26 | % | 22 | % | 17 | % | 20 | % | 26 | % | 27 | % | 26 | % | ||||||||||||||||||||||||||||||||||
Provision for income taxes (2) | 30,784 | 10,364 | 27,365 | 22,343 | 10,133 | 27,184 | 40,460 | 44,940 | ||||||||||||||||||||||||||||||||||||||||||
Net income | $ | 386,526 | $ | 362,665 | $ | 267,696 | $ | 203,874 | $ | 277,694 | $ | 362,374 | $ | 367,937 | $ | 355,006 | ||||||||||||||||||||||||||||||||||
% of Revenue | 25 | % | 25 | % | 20 | % | 16 | % | 19 | % | 24 | % | 24 | % | 23 | % | ||||||||||||||||||||||||||||||||||
Net income allocated to common shares (3) | $ | 386,526 | $ | 362,665 | $ | 267,696 | $ | 203,874 | $ | 277,182 | $ | 361,562 | $ | 367,029 | $ | 353,969 | ||||||||||||||||||||||||||||||||||
Basic earnings per common share | $ | 1.05 | $ | 0.98 | $ | 0.73 | $ | 0.55 | $ | 0.75 | $ | 0.98 | $ | 0.99 | $ | 0.96 | ||||||||||||||||||||||||||||||||||
Diluted earnings per common share | $ | 1.04 | $ | 0.97 | $ | 0.72 | $ | 0.55 | $ | 0.74 | $ | 0.97 | $ | 0.98 | $ | 0.95 | ||||||||||||||||||||||||||||||||||
Shares used to compute earnings per share (in thousands): | ||||||||||||||||||||||||||||||||||||||||||||||||||
Basic | 369,284 | 368,791 | 368,217 | 368,241 | 369,051 | 369,533 | 369,246 | 368,703 | ||||||||||||||||||||||||||||||||||||||||||
Diluted | 372,322 | 372,003 | 371,305 | 372,264 | 372,584 | 373,077 | 373,342 | 372,506 | ||||||||||||||||||||||||||||||||||||||||||
Dividends declared per share | $ | 0.62 | $ | 0.62 | $ | 0.62 | $ | 0.54 | $ | 0.54 | $ | 0.54 | $ | 0.54 | $ | 0.48 |
1. | Financial Statements |
— |
Consolidated Statements of Income for the years ended October 31, 2020, November 2, 2019 and November 3, 2018
|
|||||||
— |
Consolidated Statements of Comprehensive Income for the years ended October 31, 2020, November 2, 2019 and November 3, 2018
|
|||||||
— |
Consolidated Balance Sheets as of October 31, 2020 and November 2, 2019
|
|||||||
— |
Consolidated Statements of Shareholders’ Equity for the years ended October 31, 2020, November 2, 2019 and November 3, 2018
|
|||||||
— |
Consolidated Statements of Cash Flows for the years ended October 31, 2020, November 2, 2019 and November 3, 2018
|
Exhibit No. | Description | |||||||
2.1 |
Agreement and Plan of Merger, dated as of July 26, 2016, by and among Analog Devices, Inc., Linear Technology Corporation and Agreement and Plan of Merger, dated as of July 26, 2016, by and among Analog Devices, Inc., Linear Technology Corporation and Tahoe Acquisition Corp. Acquisition Corp., filed as exhibit 2.1 to the Company’s Current Report on Form 8-K (File No. 1-7819) as filed with the Commission on July 29, 2016 and incorporated herein by reference.
|
|||||||
2.2 |
Agreement and Plan of Merger, dated as of July 12, 2020, by and among Analog Devices, Inc., Maxim Integrated Products, Inc. and Magneto Corp., filed as exhibit 2.1 to the Company’s Current Report on Form 8-K (File No. 1-7819) as filed with the Commission on July 15, 2020 and incorporated herein by reference.
|
|||||||
3.1 |
Restated Articles of Organization of Analog Devices, Inc., as amended, filed as exhibit 3.1 to the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended May 3, 2008 (File No. 1-7819) as filed with the Commission on May 20, 2008 and incorporated herein by reference.
|
|||||||
3.2 |
Amendment to Restated Articles of Organization of Analog Devices, Inc., filed as exhibit 3.1 to the Company's Current Report on Form 8-K (File No. 1-7819) as filed with the Commission on December 8, 2008 and incorporated herein by reference.
|
|||||||
3.3 |
Amended and Restated By-Laws of Analog Devices, Inc., filed as exhibit 3.1 to the Company's Current Report on Form 8-K (File No. 1-7819) as filed with the Commission on December 17, 2018 and incorporated herein by reference.
|
|||||||
4.1 |
Indenture, dated as of June 3, 2013, by and between Analog Devices, Inc. and The Bank of New York Mellon Trust Company, N.A., as trustee, filed as exhibit 4.1 to the Company's Current Report on Form 8-K (File No. 1-7819) as filed with the Commission on June 3, 2013 and incorporated herein by reference.
|
|||||||
4.2 |
Supplemental Indenture, dated as of June 3, 2013, by and between Analog Devices, Inc. and The Bank of New York Mellon Trust Company, N.A., as trustee, filed as exhibit 4.2 to the Company's Current Report on Form 8-K (File No. 1-7819) as filed with the Commission on June 3, 2013 and incorporated herein by reference.
|
|||||||
4.3 |
Supplemental Indenture, dated December 14, 2015, between Analog Devices, Inc. and The Bank of New York Mellon Trust Company, N.A., as trustee, filed as exhibit 4.2 to the Company's Current Report on Form 8-K (File No. 1-7819) as filed with the Commission on December 14, 2015 and incorporated herein by reference.
|
|||||||
4.4 |
Supplemental Indenture, dated December 5, 2016, between Analog Devices, Inc. and The Bank of New York Mellon Trust Company, N.A., as trustee, filed as exhibit 4.2 to the Company's Current Report on Form 8-K (File No. 1-7819) as filed with the Commission on December 5, 2016 and incorporated herein by reference.
|
Exhibit No. | Description | |||||||
4.5 |
Supplemental Indenture, dated March 12, 2018, between Analog Devices, Inc. and The Bank of New York Mellon Trust Company, N.A., as trustee, filed as exhibit 4.2 to the Company's Current Report on Form 8-K (File No. 1-7819) as filed with the Commission on March 12, 2018 and incorporated herein by reference.
|
|||||||
4.6 |
Supplemental Indenture, dated April 8, 2020, between Analog Devices and The Bank of New York Mellon Trust Company, N.A., as trustee (including the form of note contained therein), filed as exhibit 4.2 to the Company’s Current Report on Form 8-K (File No. 1-7819) as filed with the Commission on April 8, 2020 and incorporated herein by reference.
|
|||||||
4.7 |
Description of Registrant's Securities, filed as exhibit 4.6 to the Company's Annual Report on Form 10-K for the fiscal year ended November 2, 2019 (File No. 1-7819) as filed with the Commission on November 26, 2019 and incorporated herein by reference.
|
|||||||
*10.1 |
Analog Devices, Inc. Amended and Restated Deferred Compensation Plan, filed as exhibit 10.1 to the Company's Current Report on Form 8-K as filed with the Commission on December 8, 2008 (File No. 1-7819) and incorporated herein by reference.
|
|||||||
*10.2 |
First Amendment to the Analog Devices, Inc. Amended and Restated Deferred Compensation Plan, filed as exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended July 30, 2011 (File No. 1-7819) as filed with the Commission on August 16, 2011 and incorporated herein by reference.
|
|||||||
*10.3 |
Second Amendment to the Analog Devices, Inc. Amended and Restated Deferred Compensation Plan, filed as exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended August 1, 2015 (File No. 1-7819) as filed with the Commission on August 18, 2015 and incorporated herein by reference.
|
|||||||
*10.4 |
Third Amendment to the Analog Devices, Inc. Amended and Restated Deferred Compensation Plan, filed as exhibit 10.6 to the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended July 29, 2017 (File No. 1-7819) as filed with the Commission on August 30, 2017 and incorporated herein by reference.
|
|||||||
*10.5 |
Fourth Amendment to the Analog Devices, Inc. Amended and Restated Deferred Compensation Plan, filed as exhibit 10.5 to the Company's Annual Report on Form 10-K for the fiscal year ended November 2, 2019 (File No. 1-7819) as filed with the Commission on November 26, 2019 and incorporated herein by reference.
|
|||||||
*10.6 |
Trust Agreement for Deferred Compensation Plan dated as of October 1, 2003 between Analog Devices, Inc. and Fidelity Management Trust Company, filed as exhibit 10.28 to the Company's Annual Report on Form 10-K for the fiscal year ended November 1, 2003 (File No. 1-7819) as filed with the Commission on December 23, 2003 and incorporated herein by reference.
|
|||||||
*10.7 |
First Amendment to Trust Agreement for Deferred Compensation Plan between Analog Devices, Inc. and Fidelity Management Trust Company dated as of January 1, 2005, filed as exhibit 10.3 to the Company's Annual Report on Form 10-K for the fiscal year ended October 28, 2006 (File No. 1-7819) as filed with the Commission on November 20, 2006 and incorporated herein by reference.
|
|||||||
*10.8 |
Second Amendment to Trust Agreement for Deferred Compensation Plan between Analog Devices, Inc. and Fidelity Management Trust Company dated as of December 10, 2007, filed as exhibit 10.41 to the Company's Annual Report on Form 10-K for the fiscal year ended November 1, 2008 (File No. 1-7819) as filed with the Commission on November 25, 2008 and incorporated herein by reference.
|
|||||||
*10.9 |
Amended and Restated 2006 Stock Incentive Plan of Analog Devices, Inc., filed as exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended February 1, 2014 (File No. 1-7819) as filed with the Commission on February 18, 2014 and incorporated herein by reference.
|
|||||||
*10.10 |
Linear Technology Corporation Amended and Restated 2005 Equity Incentive Plan, filed as Exhibit 4.1 to the Post-Effective Amendment No. 1 on Form S-8 to the Company's Registration Statement on Form S-4 (File No. 333-213454) as filed with the Commission on March 15, 2017 and incorporated herein by reference.
|
|||||||
*10.11 |
Analog Devices, Inc. Amended and Restated 2010 Equity Incentive Plan, filed as Exhibit 4.2 to the Post-Effective Amendment No. 1 on Form S-8 to the Company's Registration Statement on Form S-4 (File No. 333-213454) as filed with the Commission on March 15, 2017 and incorporated herein by reference.
|
|||||||
*10.12 |
Form of Global Non-Qualified Stock Option Agreement for Employees for usage under the Company's Amended and Restated 2006 Stock Incentive Plan, filed as exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended February 2, 2019 (File No. 1-7819) as filed with the Commission on February 20, 2019 and incorporated herein by reference.
|
|||||||
*10.13 |
Form of Non-Qualified Stock Option Agreement for Directors for usage under the Company's Amended and Restated 2006 Stock Incentive Plan, filed as exhibit 10.4 to the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended January 28, 2017 (File No. 1-7819) as filed with the Commission on February 15, 2017 and incorporated herein by reference.
|
|||||||
*10.14 |
Form of Global Restricted Stock Unit Agreement for Employees for usage under the Company's Amended and Restated 2006 Stock Incentive Plan, filed as exhibit 10.2 to the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended February 2, 2019 (File No. 1-7819) as filed with the Commission on February 20, 2019 and incorporated herein by reference.
|
Exhibit No. | Description | |||||||
*10.15 |
Form of Performance Restricted Stock Unit Agreement for Employees for usage under the Company's Amended and Restated 2006 Stock Incentive Plan, filed as exhibit 10.7 to the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended February 3, 2018 (File No. 1-7819) as filed with the Commission on February 28, 2018 and incorporated herein by reference.
|
|||||||
*10.16 |
Form of Relative TSR Performance Restricted Stock Unit Agreement for Employees for usage under the Company's Amended and Restated 2006 Stock Incentive Plan, filed as exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended May 4, 2019 (File No. 1-7819) as filed with the Commission on May 22, 2019 and incorporated herein by reference.
|
|||||||
*10.17 |
Form of Financial Key Metric Performance Restricted Stock Unit Agreement for Employees for usage under the Company's Amended and Restated 2006 Stock Incentive Plan, filed as Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended May 4, 2019 (File No. 1-7819) as filed with the Commission on May 22, 2019 and incorporated herein by reference.
|
|||||||
*10.18 |
Form of Restricted Stock Unit Agreement for Directors for usage under the Company's Amended and Restated 2006 Stock Incentive Plan, filed as exhibit 10.3 to the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended February 2, 2019 (File No. 1-7819) as filed with the Commission on February 20, 2019 and incorporated herein by reference.
|
|||||||
*10.19 |
Form of Analog Devices, Inc. Equity Award Conversion Notice to Linear employees, filed as exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended April 29, 2017 (File No. 1-7819) as filed with the Commission on May 31, 2017 and incorporated herein by reference.
|
|||||||
*10.20 |
Form of Linear Integration Performance Restricted Stock Unit Agreement for Employees for usage under the Analog Devices, Inc. Amended and Restated 2006 Stock Incentive Plan, filed as Exhibit 10.1 to the Company's Current Report on Form 8-K (File No. 1-7819) as filed with the Commission on July 11, 2017 and incorporated by reference herein.
|
|||||||
*10.21 |
Analog Devices, Inc. 2020 Equity Incentive Plan, filed as Appendix B to the Company’s Definitive Proxy Statement on Schedule 14A (File No. 1-7819), as filed with the Commission on January 24, 2020 and incorporated herein by reference.
|
|||||||
*10.22 |
Form of Financial Metric Performance Restricted Stock Unit Agreement for Employees for usage under the Company's 2020 Equity Incentive Plan, filed as exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended February 1, 2020 (File No. 1-7819) as filed with the Commission on February 19, 2020 and incorporated herein by reference.
|
|||||||
*10.23 |
Form of Global Non-Qualified Stock Option Agreement for Employees for usage under the Company's 2020 Equity Incentive Plan, filed as exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended February 1, 2020 (File No. 1-7819) as filed with the Commission on February 19, 2020 and incorporated herein by reference.
|
|||||||
*10.24 |
Form of Global Restricted Stock Unit Agreement for Employees for usage under the Company's 2020 Equity Incentive Plan, filed as exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended February 1, 2020 (File No. 1-7819) as filed with the Commission on February 19, 2020 and incorporated herein by reference.
|
|||||||
*10.25 |
Form of Restricted Stock Unit Agreement for Directors for usage under the Company's 2020 Equity Incentive Plan, filed as exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended February 1, 2020 (File No. 1-7819) as filed with the Commission on February 19, 2020 and incorporated herein by reference.
|
|||||||
*10.26 |
Form of Relative Total Shareholder Return Performance Restricted Stock Unit Agreement for Employees for usage under the Company's 2020 Equity Incentive Plan, filed as exhibit 10.5 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended February 1, 2020 (File No. 1-7819) as filed with the Commission on February 19, 2020 and incorporated herein by reference.
|
|||||||
*10.27 |
2020 Executive Performance Incentive Plan, filed as exhibit 10.22 to the Company's Annual Report on Form 10-K for the fiscal year ended November 2, 2019 (File No. 1-7819) as filed with the Commission on November 26, 2019 and incorporated herein by reference.
|
|||||||
†*10.28 | ||||||||
*10.29 |
Form of Employee Retention Agreement, filed as exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended May 5, 2012 (File No. 1-7819) as filed with the Commission on May 22, 2012 and incorporated herein by reference.
|
|||||||
*10.30 |
Employee Change in Control Severance Policy of Analog Devices, Inc., as amended, filed as exhibit 10.20 to the Company's Annual Report on Form 10-K for the fiscal year ended October 30, 1999 (File No. 1-7819) as filed with the Commission on January 28, 2000 and incorporated herein by reference.
|
|||||||
*10.31 |
Senior Management Change in Control Severance Policy of Analog Devices, Inc., as amended, filed as exhibit 10.21 to the Company's Annual Report on Form 10-K for the fiscal year ended October 30, 1999 (File No. 1-7819) as filed with the Commission on January 28, 2000 and incorporated herein by reference.
|
Exhibit No. | Description | |||||||
*10.32 |
Offer Letter for Prashanth Mahendra-Rajah, dated August 4, 2017, filed as exhibit 10.28 to the Company's Annual Report on Form 10-K for the fiscal year ended October 28, 2017 (File No. 1-7819) as filed with the Commission on November 22, 2017 and incorporated herein by reference.
|
|||||||
*10.33 |
Form of Indemnification Agreement for Directors and Officers, filed as exhibit 10.30 to the Company's Annual Report on Form 10-K for the fiscal year ended November 1, 2008 (File No. 1-7819) as filed with the Commission on November 25, 2008 and incorporated herein by reference.
|
|||||||
*10.34
|
Credit Agreement, dated as of June 28, 2019, among Analog Devices, Inc., as Borrower, JPMorgan Chase Bank, N.A. as Administrative Agent and each lender from time to time party thereto, filed as exhibit 10.1 to the Company's Current Report on Form 8-K (File No. 1-7819) as filed with the Commission on July 1, 2019 and incorporated herein by reference.
|
|||||||
*10.35 |
Second Amended and Restated Credit Agreement, dated as of June 28, 2019, among Analog Devices, Inc., as Borrower, Bank of America, N.A. as Administrative Agent, Swing Line Lender and L/C Issuer and each lender from time to time party thereto, filed as exhibit 10.2 to the Company's Current Report on Form 8-K (File No. 1-7819) as filed with the Commission on July 1, 2019 and incorporated herein by reference.
|
|||||||
†21 | ||||||||
†23 | ||||||||
†31.1 | ||||||||
†31.2 | ||||||||
†32.1 | ||||||||
†32.2 | ||||||||
101. INS | The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the inline XBRL document.** | |||||||
101. SCH | Inline XBRL Schema Document.** | |||||||
101. CAL | Inline XBRL Calculation Linkbase Document.** | |||||||
101. LAB | Inline XBRL Labels Linkbase Document.** | |||||||
101. PRE | Inline XBRL Presentation Linkbase Document.** | |||||||
101. DEF | Inline XBRL Definition Linkbase Document** | |||||||
104 | Cover page Interactive Data File (formatted as inline XBRL with applicable taxonomy extension information contained in Exhibits 101). |
† | Filed herewith. | |||||||
* | Management contracts and compensatory plan or arrangements required to be filed as an Exhibit pursuant to Item 15(b) of Form 10-K. | |||||||
** | Submitted electronically herewith. |
Description | Balance at Beginning of Period | Additions (Reductions) Charged to Income Statement | Other | Deductions |
Balance at
End of Period |
|||||||||||||||||||||||||||
Accounts Receivable Reserves and Allowances: | ||||||||||||||||||||||||||||||||
Year ended November 3, 2018 | $ | 7,213 | $ | 2,313 | $ | — | $ | 7,242 | $ | 2,284 | ||||||||||||||||||||||
Year ended November 2, 2019 | $ | 2,284 | $ | 13,979 | $ | — | $ | 7,876 | $ | 8,387 | ||||||||||||||||||||||
Year ended October 31, 2020 | $ | 8,387 | $ | 1,318 | $ | — | $ | 5,355 | $ | 4,350 | ||||||||||||||||||||||
Valuation Allowance for Deferred Tax Asset: | ||||||||||||||||||||||||||||||||
Year ended November 3, 2018 | $ | 53,787 | $ | 30,254 | $ | (1,761) | $ | — | $ | 82,280 | ||||||||||||||||||||||
Year ended November 2, 2019 | $ | 82,280 | $ | 34,069 | $ | — | $ | — | $ | 116,349 | ||||||||||||||||||||||
Year ended October 31, 2020 | $ | 116,349 | $ | 37,622 | $ | 159 | $ | — | $ | 154,130 |
ANALOG DEVICES, INC. | |||||
By: | /s/ Vincent Roche | ||||
Vincent Roche
President and Chief Executive Officer (Principal Executive Officer) |
Name | Title | Date | ||||||||||||
/s/ Ray Stata | Chairman of the Board | November 24, 2020 | ||||||||||||
Ray Stata | ||||||||||||||
/s/ Vincent Roche |
President and Chief Executive Officer and Director
(Principal Executive Officer) |
November 24, 2020 | ||||||||||||
Vincent Roche | ||||||||||||||
/s/ Prashanth Mahendra-Rajah |
Senior Vice President, Finance and
Chief Financial Officer (Principal Financial Officer) |
November 24, 2020 | ||||||||||||
Prashanth Mahendra-Rajah | ||||||||||||||
/s/ Michael Sondel |
Chief Accounting Officer
(Principal Accounting Officer) |
November 24, 2020 | ||||||||||||
Michael Sondel | ||||||||||||||
/s/ James A. Champy | Director | November 24, 2020 | ||||||||||||
James A. Champy | ||||||||||||||
/s/ Anantha P. Chandrakasan | Director | November 24, 2020 | ||||||||||||
Anantha P. Chandrakasan | ||||||||||||||
/s/ Bruce R. Evans | Director | November 24, 2020 | ||||||||||||
Bruce R. Evans | ||||||||||||||
/s/ Edward H. Frank | Director | November 24, 2020 | ||||||||||||
Edward H. Frank | ||||||||||||||
/s/ Dr. Laurie H. Glimcher | Director | November 24, 2020 | ||||||||||||
Dr. Laurie H. Glimcher | ||||||||||||||
/s/ Karen Golz | Director | November 24, 2020 | ||||||||||||
Karen Golz | ||||||||||||||
/s/ Mark M. Little | Director | November 24, 2020 | ||||||||||||
Mark M. Little | ||||||||||||||
/s/ Kenton J. Sicchitano | Director | November 24, 2020 | ||||||||||||
Kenton J. Sicchitano | ||||||||||||||
/s/ Susie Wee | Director | November 24, 2020 | ||||||||||||
Susie Wee |
50% of Bonus Based on OPBT/Revenue | Bonus Payout Factor | |||||||
≤36%
|
0% | |||||||
39% | 100% | |||||||
42% | 200% | |||||||
≥45%
|
300% |
50% of Bonus Based on Revenue Growth | Bonus Payout Factor | |||||||
≤0%
|
0% | |||||||
5% | 100% | |||||||
10% | 200% | |||||||
≥15%
|
300% |
Name of Subsidiary | State or Other Jurisdiction of Incorporation or Organization | ||||
Analog Devices Australia Pty. Ltd. | Australia | ||||
Analog Devices Pty, Ltd. | Australia | ||||
Analog Devices, GMBH | Austria | ||||
Analog Devices Bermuda Ltd. | Bermuda | ||||
Analog Devices Canada, Ltd. | Canada | ||||
Analog Devices (China) Co. Ltd. | China | ||||
Analog Devices (Shanghai) Co. Ltd. | China | ||||
Analog Devices (Hangzhou) Co. Ltd. | China | ||||
Analog Devices A/S | Denmark | ||||
Analog Devices Limited Egypt LLC | Egypt | ||||
Analog Devices (Finland) OY | Finland | ||||
Analog Devices, SAS | France | ||||
Analog Devices, GmbH | Germany | ||||
Analog Devices India Private Limited | India | ||||
Acuitas Silicon Limited | Ireland | ||||
Analog Devices International U.C. | Ireland | ||||
Analog Devices Israel, Ltd. | Israel | ||||
Analog Devices SRL | Italy | ||||
Analog Devices, K.K. | Japan | ||||
Analog Devices Korea, Ltd. | Korea | ||||
Analog Devices Sdn Bhd | Malaysia | ||||
Analog Devices Coöperatief, U.A. | The Netherlands | ||||
Analog Devices Holdings, B.V. | The Netherlands | ||||
Analog Devices Nederland, B.V. | The Netherlands | ||||
Analog Devices Norway AS | Norway | ||||
Analog Devices (Philippines), Inc. | The Philippines | ||||
Analog Devices Gen. Trias, Inc. | The Philippines | ||||
Analog Devices Realty Holdings, Inc. | The Philippines | ||||
Analog Devices Sp. Z o.o. | Poland | ||||
Analog Devices S.L.U. | Spain | ||||
Analog Devices A.B. | Sweden | ||||
Analog Devices Taiwan, Ltd. | Taiwan | ||||
Analog Devices Mikroelektronik Sanayi Ve Ticaret Ltd. Sirketi | Turkey |
Name of Subsidiary | State or Other Jurisdiction of Incorporation or Organization | ||||
Analog Devices Limited | United Kingdom | ||||
Analog Devices International, Inc. | Massachusetts, USA | ||||
Analog Devices Federal LLC | Delaware, USA | ||||
ADI Micromachines, Inc. | Delaware, USA | ||||
Electric Motors Test, S.L. | Spain | ||||
Hittite Microwave SARL | France | ||||
Hittite Microwave India Pvt. Ltd. | India | ||||
Hittite Microwave LLC | Delaware, USA | ||||
HMC Netherlands, C.V. | The Netherlands | ||||
Innovasic, Inc. | Delaware, USA | ||||
Linear Technology Canada Corp. | Canada | ||||
Linear Technology SARL | France | ||||
Linear Technology GmbH | Germany | ||||
Linear Technology Corporation Limited | Hong Kong | ||||
Linear Technology Semiconductor India PTE LTD | India | ||||
Linear Technology (Israel) Ltd. | Israel | ||||
Linear Technology (Italy) Srl | Italy | ||||
Linear Technology GK | Japan | ||||
Linear Technology KK | Japan | ||||
Linear Technology Korea Co. Ltd. | Korea | ||||
Linear Technology Semiconductor Mexico S. de R.L. de C.V. | Mexico | ||||
Linear Technology PTE LTD | Singapore | ||||
Linear Technology Taiwan Corporation | Taiwan | ||||
Linear Technology (U.K.) Limited | United Kingdom | ||||
Lyric Semiconductor, Inc. | Delaware, USA | ||||
Linear Technology Holding Company | Delaware, USA | ||||
Linear Technology Holding LLC | Delaware, USA | ||||
Multigig, Inc. | Delaware, USA | ||||
OneTree Microdevices, Inc. | Delaware, USA | ||||
OtoSense Inc. | Delaware, USA | ||||
Ruwisch + Kollegen GmbH | Germany | ||||
SNAP Sensor SA | Switzerland | ||||
Symeo GmbH | Germany |
/s/ Vincent Roche | |||||
Vincent Roche | |||||
President and Chief Executive Officer | |||||
(Principal Executive Officer) | |||||
Dated: November 24, 2020
|
/s/ Prashanth Mahendra-Rajah | |||||
Prashanth Mahendra-Rajah | |||||
Senior Vice President, Finance | |||||
and Chief Financial Officer | |||||
(Principal Financial Officer) | |||||
Dated: November 24, 2020
|
/s/ Vincent Roche | |||||
Vincent Roche | |||||
Chief Executive Officer | |||||
Dated: November 24, 2020
|
/s/ Prashanth Mahendra-Rajah | |||||
Prashanth Mahendra-Rajah | |||||
Chief Financial Officer | |||||
Dated: November 24, 2020
|