|
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[X]
|
QUARTERLY 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
|
State of Delaware
|
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93-0835214
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(State or other jurisdiction of incorporation or
organization)
|
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(I.R.S. Employer Identification No.)
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111 SW Fifth Ave, Ste 700, Portland, OR
|
|
97204
|
(Address of principal executive offices)
|
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(Zip Code)
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Large accelerated filer [ ]
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Accelerated filer [X]
|
|
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Non-accelerated filer [ ]
|
Smaller reporting company [ ]
|
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|
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Emerging growth company [ ]
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PART I.
|
FINANCIAL INFORMATION
|
Page
|
|
|
|
Item 1.
|
||
|
|
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||
|
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||
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Item 2.
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Item 3.
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||
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Item 4.
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||
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PART II.
|
OTHER INFORMATION
|
|
|
|
|
Item 1.
|
||
|
|
|
Item 1A.
|
||
|
|
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Item 6.
|
||
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
(In thousands, except per share data)
|
September 29,
2018 |
|
September 30,
2017 |
|
September 29,
2018 |
|
September 30,
2017 |
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
Product
|
$
|
97,932
|
|
|
$
|
87,369
|
|
|
$
|
291,335
|
|
|
$
|
263,206
|
|
Licensing and services
|
3,552
|
|
|
4,602
|
|
|
11,487
|
|
|
27,489
|
|
||||
Total revenue
|
101,484
|
|
|
91,971
|
|
|
302,822
|
|
|
290,695
|
|
||||
Costs and expenses:
|
|
|
|
|
|
|
|
||||||||
Cost of product revenue
|
43,120
|
|
|
38,032
|
|
|
137,430
|
|
|
120,395
|
|
||||
Cost of licensing and services revenue
|
—
|
|
|
617
|
|
|
259
|
|
|
4,937
|
|
||||
Research and development
|
19,131
|
|
|
25,648
|
|
|
63,153
|
|
|
79,857
|
|
||||
Selling, general, and administrative
|
21,775
|
|
|
21,290
|
|
|
69,886
|
|
|
67,133
|
|
||||
Amortization of acquired intangible assets
|
3,823
|
|
|
8,526
|
|
|
13,982
|
|
|
25,777
|
|
||||
Restructuring charges
|
90
|
|
|
3,071
|
|
|
5,495
|
|
|
4,713
|
|
||||
Acquisition related charges
|
—
|
|
|
681
|
|
|
1,531
|
|
|
3,208
|
|
||||
Impairment of acquired intangible assets
|
586
|
|
|
36,198
|
|
|
12,486
|
|
|
36,198
|
|
||||
Gain on sale of building
|
—
|
|
|
(4,624
|
)
|
|
—
|
|
|
(4,624
|
)
|
||||
Total costs and expenses
|
88,525
|
|
|
129,439
|
|
|
304,222
|
|
|
337,594
|
|
||||
Income (loss) from operations
|
12,959
|
|
|
(37,468
|
)
|
|
(1,400
|
)
|
|
(46,899
|
)
|
||||
Interest expense
|
(5,500
|
)
|
|
(3,888
|
)
|
|
(15,582
|
)
|
|
(14,112
|
)
|
||||
Other expense, net
|
(452
|
)
|
|
(2,027
|
)
|
|
(246
|
)
|
|
(2,104
|
)
|
||||
Income (loss) before income taxes
|
7,007
|
|
|
(43,383
|
)
|
|
(17,228
|
)
|
|
(63,115
|
)
|
||||
Income tax expense (benefit)
|
33
|
|
|
(331
|
)
|
|
1,973
|
|
|
234
|
|
||||
Net income (loss)
|
$
|
6,974
|
|
|
$
|
(43,052
|
)
|
|
$
|
(19,201
|
)
|
|
$
|
(63,349
|
)
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.05
|
|
|
$
|
(0.35
|
)
|
|
$
|
(0.15
|
)
|
|
$
|
(0.52
|
)
|
Diluted
|
$
|
0.05
|
|
|
$
|
(0.35
|
)
|
|
$
|
(0.15
|
)
|
|
$
|
(0.52
|
)
|
|
|
|
|
|
|
|
|
||||||||
Shares used in per share calculations:
|
|
|
|
|
|
|
|
||||||||
Basic
|
127,816
|
|
|
122,990
|
|
|
125,578
|
|
|
122,393
|
|
||||
Diluted
|
129,474
|
|
|
122,990
|
|
|
125,578
|
|
|
122,393
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
(In thousands)
|
September 29,
2018 |
|
September 30,
2017 |
|
September 29,
2018 |
|
September 30,
2017 |
||||||||
Net income (loss)
|
$
|
6,974
|
|
|
$
|
(43,052
|
)
|
|
$
|
(19,201
|
)
|
|
$
|
(63,349
|
)
|
Other comprehensive income (loss:)
|
|
|
|
|
|
|
|
||||||||
Unrealized gain (loss) related to marketable securities, net of tax
|
14
|
|
|
(1
|
)
|
|
16
|
|
|
(72
|
)
|
||||
Reclassification adjustment for (gains) losses related to marketable securities included in other expense, net of tax
|
(17
|
)
|
|
37
|
|
|
(18
|
)
|
|
237
|
|
||||
Translation adjustment, net of tax
|
(584
|
)
|
|
431
|
|
|
(1,124
|
)
|
|
1,381
|
|
||||
Change in actuarial valuation of defined benefit pension
|
—
|
|
|
—
|
|
|
—
|
|
|
(47
|
)
|
||||
Comprehensive income (loss)
|
$
|
6,387
|
|
|
$
|
(42,585
|
)
|
|
$
|
(20,327
|
)
|
|
$
|
(61,850
|
)
|
(In thousands, except share and par value data)
|
September 29,
2018 |
|
December 30,
2017 |
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
107,893
|
|
|
$
|
106,815
|
|
Short-term marketable securities
|
9,600
|
|
|
4,982
|
|
||
Accounts receivable, net of allowance for doubtful accounts
|
75,648
|
|
|
55,104
|
|
||
Inventories
|
66,381
|
|
|
79,903
|
|
||
Prepaid expenses and other current assets
|
24,143
|
|
|
16,567
|
|
||
Total current assets
|
283,665
|
|
|
263,371
|
|
||
Property and equipment, less accumulated depreciation of
$139,310 at September 29, 2018 and $131,260 at December 30, 2017
|
35,724
|
|
|
40,423
|
|
||
Intangible assets, net
|
24,977
|
|
|
51,308
|
|
||
Goodwill
|
267,514
|
|
|
267,514
|
|
||
Deferred income taxes
|
188
|
|
|
198
|
|
||
Other long-term assets
|
20,259
|
|
|
13,147
|
|
||
Total assets
|
$
|
632,327
|
|
|
$
|
635,961
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable and accrued expenses (includes restructuring)
|
$
|
46,929
|
|
|
$
|
54,405
|
|
Accrued payroll obligations
|
9,859
|
|
|
10,416
|
|
||
Current portion of long-term debt
|
14,104
|
|
|
1,508
|
|
||
Deferred income and allowances on sales to distributors
|
—
|
|
|
17,250
|
|
||
Deferred licensing and services revenue
|
—
|
|
|
68
|
|
||
Total current liabilities
|
70,892
|
|
|
83,647
|
|
||
Long-term debt
|
261,035
|
|
|
299,667
|
|
||
Other long-term liabilities
|
39,274
|
|
|
34,954
|
|
||
Total liabilities
|
371,201
|
|
|
418,268
|
|
||
Contingencies (Note 16)
|
—
|
|
|
—
|
|
||
Stockholders' equity:
|
|
|
|
||||
Preferred stock, $.01 par value, 10,000,000 shares authorized, none issued and outstanding
|
—
|
|
|
—
|
|
||
Common stock, $.01 par value, 300,000,000 shares authorized; 129,275,000 shares issued and outstanding as of September 29, 2018 and 123,895,000 shares issued and outstanding as of December 30, 2017
|
1,293
|
|
|
1,239
|
|
||
Additional paid-in capital
|
732,073
|
|
|
695,768
|
|
||
Accumulated deficit
|
(469,662
|
)
|
|
(477,862
|
)
|
||
Accumulated other comprehensive loss
|
(2,578
|
)
|
|
(1,452
|
)
|
||
Total stockholders' equity
|
261,126
|
|
|
217,693
|
|
||
Total liabilities and stockholders' equity
|
$
|
632,327
|
|
|
$
|
635,961
|
|
|
Nine Months Ended
|
||||||
(In thousands)
|
September 29, 2018
|
|
September 30, 2017
|
||||
Cash flows from operating activities:
|
|
|
|
||||
Net loss
|
$
|
(19,201
|
)
|
|
$
|
(63,349
|
)
|
Adjustments to reconcile net loss to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
30,740
|
|
|
45,591
|
|
||
Impairment of acquired intangible assets
|
12,486
|
|
|
36,198
|
|
||
Amortization of debt issuance costs and discount
|
1,847
|
|
|
1,680
|
|
||
(Gain) loss on sale or maturity of marketable securities
|
(18
|
)
|
|
237
|
|
||
Gain on forward contracts
|
(105
|
)
|
|
(72
|
)
|
||
Stock-based compensation expense
|
9,908
|
|
|
9,286
|
|
||
Gain on disposal of fixed assets
|
(135
|
)
|
|
(197
|
)
|
||
Gain on sale of building
|
—
|
|
|
(4,624
|
)
|
||
Loss on sale of assets and business units
|
—
|
|
|
1,496
|
|
||
Impairment of cost-method investment
|
266
|
|
|
692
|
|
||
Changes in assets and liabilities:
|
|
|
|
||||
Accounts receivable, net
|
(18,736
|
)
|
|
20,687
|
|
||
Inventories
|
13,892
|
|
|
1,519
|
|
||
Prepaid expenses and other assets
|
(11,729
|
)
|
|
3,839
|
|
||
Accounts payable and accrued expenses (includes restructuring)
|
1,661
|
|
|
(17,901
|
)
|
||
Accrued payroll obligations
|
(557
|
)
|
|
(2,002
|
)
|
||
Income taxes payable
|
309
|
|
|
(711
|
)
|
||
Deferred income and allowances on sales to distributors
|
—
|
|
|
3,862
|
|
||
Deferred licensing and services revenue
|
(68
|
)
|
|
(485
|
)
|
||
Net cash provided by operating activities
|
20,560
|
|
|
35,746
|
|
||
Cash flows from investing activities:
|
|
|
|
||||
Proceeds from sales of and maturities of short-term marketable securities
|
5,000
|
|
|
9,689
|
|
||
Purchases of marketable securities
|
(9,603
|
)
|
|
(7,420
|
)
|
||
Proceeds from sale of building
|
—
|
|
|
7,895
|
|
||
Cash paid for costs of sale of building
|
—
|
|
|
(1,004
|
)
|
||
Capital expenditures
|
(6,178
|
)
|
|
(12,325
|
)
|
||
Proceeds from sale of assets and business units
|
—
|
|
|
967
|
|
||
Short-term loan to cost-method investee
|
—
|
|
|
(2,000
|
)
|
||
Cash paid for software licenses
|
(6,144
|
)
|
|
(6,472
|
)
|
||
Net cash used in investing activities
|
(16,925
|
)
|
|
(10,670
|
)
|
||
Cash flows from financing activities:
|
|
|
|
||||
Restricted stock unit tax withholdings
|
(1,600
|
)
|
|
(2,787
|
)
|
||
Proceeds from issuance of common stock
|
28,051
|
|
|
3,452
|
|
||
Repayment of debt
|
(27,884
|
)
|
|
(33,679
|
)
|
||
Net cash used in financing activities
|
(1,433
|
)
|
|
(33,014
|
)
|
||
|
|
|
|
||||
See Accompanying Notes to Unaudited Consolidated Financial Statements.
|
|
|
September 29,
2018 |
|
December 30,
2017 |
||||
Total cost of contracts for Japanese yen
(in thousands)
|
|
$
|
1,955
|
|
|
$
|
2,204
|
|
Number of contracts
|
|
2
|
|
|
2
|
|
||
Settlement month
|
|
June 2019
|
|
|
June 2018
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||
|
September 29, 2018
|
|
September 30, 2017
|
|
September 29, 2018
|
|
September 30, 2017
|
||||
Revenue attributable to top five end customers
|
20
|
%
|
|
23
|
%
|
|
17
|
%
|
|
28
|
%
|
Revenue attributable to largest end customer
|
6
|
%
|
|
5
|
%
|
|
5
|
%
|
|
9
|
%
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||
|
September 29, 2018
|
|
September 30, 2017
|
|
September 29, 2018
|
|
September 30, 2017
|
||||
Revenue attributable to distributors*
|
82
|
%
|
|
80
|
%
|
|
85
|
%
|
|
75
|
%
|
*
|
During the first quarter of 2018, we updated our channel categories to group all forms of distribution into a single channel. Prior periods have been reclassified to match the current period presentation.
|
Condensed Consolidated Statement of Operations
|
||||||||||||||||||
|
|
Three months ended September 29, 2018
|
|
Nine months ended September 29, 2018
|
||||||||||||||
(In thousands, except per share data)
|
|
As reported under new standard
|
|
Adjustments
|
|
Pro forma as if previous standard was in effect
|
|
As reported under new standard
|
|
Adjustments
|
|
Pro forma as if previous standard was in effect
|
||||||
Product revenue
|
|
97,932
|
|
|
(1,302
|
)
|
|
96,630
|
|
|
291,335
|
|
|
(13,651
|
)
|
|
277,684
|
|
Licensing and services revenue
|
|
3,552
|
|
|
(1,525
|
)
|
|
2,027
|
|
|
11,487
|
|
|
1,662
|
|
|
13,149
|
|
Cost of product revenue
|
|
43,120
|
|
|
144
|
|
|
43,264
|
|
|
137,430
|
|
|
(5,400
|
)
|
|
132,030
|
|
Net income (loss)
|
|
6,974
|
|
|
(2,971
|
)
|
|
4,003
|
|
|
(19,201
|
)
|
|
(6,589
|
)
|
|
(25,790
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Net income (loss) per share, basic and diluted
|
|
0.05
|
|
|
(0.02
|
)
|
|
0.03
|
|
|
(0.15
|
)
|
|
(0.06
|
)
|
|
(0.21
|
)
|
Condensed Consolidated Balance Sheets
|
|||||||||
|
|
As of September 29, 2018
|
|||||||
(In thousands)
|
|
As reported under new standard
|
|
Adjustments
|
|
Pro forma as if previous standard was in effect
|
|||
Accounts receivable, net of allowance for doubtful accounts
|
|
75,648
|
|
|
7,091
|
|
|
82,739
|
|
Inventories
|
|
66,381
|
|
|
25
|
|
|
66,406
|
|
Prepaid expenses and other current assets
|
|
24,143
|
|
|
(6,568
|
)
|
|
17,575
|
|
Total assets
|
|
632,327
|
|
|
548
|
|
|
632,875
|
|
|
|
|
|
|
|
|
|||
Accounts payable and accrued expenses (includes restructuring)
|
|
46,929
|
|
|
(887
|
)
|
|
46,042
|
|
Deferred income and allowances on sales to distributors
|
|
—
|
|
|
35,425
|
|
|
35,425
|
|
Accumulated deficit
|
|
(469,662
|
)
|
|
(33,990
|
)
|
|
(503,652
|
)
|
Total liabilities and stockholders' equity
|
|
632,327
|
|
|
548
|
|
|
632,875
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
(in thousands, except per share data)
|
September 29,
2018 |
|
September 30,
2017 |
|
September 29,
2018 |
|
September 30,
2017 |
||||||||
Net income (loss)
|
$
|
6,974
|
|
|
$
|
(43,052
|
)
|
|
$
|
(19,201
|
)
|
|
$
|
(63,349
|
)
|
|
|
|
|
|
|
|
|
||||||||
Shares used in basic Net income (loss) per share
|
127,816
|
|
|
122,990
|
|
|
125,578
|
|
|
122,393
|
|
||||
Dilutive effect of stock options, RSUs and ESPP shares
|
1,658
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Shares used in diluted Net income (loss) per share
|
129,474
|
|
|
122,990
|
|
|
125,578
|
|
|
122,393
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Basic Net income (loss) per share
|
$
|
0.05
|
|
|
$
|
(0.35
|
)
|
|
$
|
(0.15
|
)
|
|
$
|
(0.52
|
)
|
Diluted Net income (loss) per share
|
$
|
0.05
|
|
|
$
|
(0.35
|
)
|
|
$
|
(0.15
|
)
|
|
$
|
(0.52
|
)
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||
(in thousands)
|
September 29, 2018
|
|
September 30, 2017
|
|
September 29, 2018
|
|
September 30, 2017
|
||||
Stock options, RSUs, and ESPP shares excluded as they are antidilutive
|
2,299
|
|
|
7,221
|
|
|
8,284
|
|
|
6,018
|
|
(In thousands)
|
September 29,
2018 |
|
December 30,
2017 |
||||
Short-term marketable securities:
|
|
|
|
||||
Maturing within one year
|
$
|
7,435
|
|
|
$
|
4,982
|
|
Maturing between one and two years
|
2,165
|
|
|
—
|
|
||
Total marketable securities
|
$
|
9,600
|
|
|
$
|
4,982
|
|
|
Fair value measurements as of
|
|
Fair value measurements as of
|
||||||||||||||||||||||||||||
|
September 29, 2018
|
|
December 30, 2017
|
||||||||||||||||||||||||||||
(In thousands)
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||||||||
Short-term marketable securities
|
$
|
9,600
|
|
|
$
|
9,600
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,982
|
|
|
$
|
4,982
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Foreign currency forward exchange contracts, net
|
105
|
|
|
—
|
|
|
105
|
|
|
—
|
|
|
77
|
|
|
—
|
|
|
77
|
|
|
—
|
|
||||||||
Total fair value of financial instruments
|
$
|
9,705
|
|
|
$
|
9,600
|
|
|
$
|
105
|
|
|
$
|
—
|
|
|
$
|
5,059
|
|
|
$
|
4,982
|
|
|
$
|
77
|
|
|
$
|
—
|
|
(In thousands)
|
September 29,
2018 |
|
December 30,
2017 |
||||
Work in progress
|
$
|
47,122
|
|
|
$
|
49,642
|
|
Finished goods
|
19,259
|
|
|
30,261
|
|
||
Total inventories
|
$
|
66,381
|
|
|
$
|
79,903
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
(In thousands)
|
September 29,
2018 |
|
September 30,
2017 |
|
September 29,
2018 |
|
September 30,
2017 |
||||||||
Research and development
|
$
|
14
|
|
|
$
|
128
|
|
|
$
|
264
|
|
|
$
|
442
|
|
Amortization of acquired intangible assets
|
3,823
|
|
|
8,526
|
|
|
13,982
|
|
|
25,777
|
|
||||
|
$
|
3,837
|
|
|
$
|
8,654
|
|
|
$
|
14,246
|
|
|
$
|
26,219
|
|
Fiscal year
|
|
(in thousands)
|
||
|
|
|
||
2018 (remaining 3 months)
|
|
$
|
875
|
|
2019
|
|
$
|
5,000
|
|
(In thousands)
|
September 29,
2018 |
|
December 30,
2017 |
||||
Trade accounts payable
|
$
|
26,150
|
|
|
$
|
35,350
|
|
Liability for non-cancelable contracts
|
7,471
|
|
|
7,232
|
|
||
Deferred rent
|
3,809
|
|
|
3,834
|
|
||
Other accrued expenses (includes restructuring)
|
9,499
|
|
|
7,989
|
|
||
Total accounts payable and accrued expenses
|
$
|
46,929
|
|
|
$
|
54,405
|
|
|
Common Stock
($.01 par value)
|
|
Additional Paid-in
capital
|
|
Accumulated
deficit
|
|
Accumulated
other
comprehensive
loss
|
|
Total
|
|||||||||||||
(In thousands, except par value data)
|
Shares
|
|
Amount
|
|
|
|
|
|||||||||||||||
Balances, December 30, 2017
|
123,895
|
|
|
$
|
1,239
|
|
|
$
|
695,768
|
|
|
$
|
(477,862
|
)
|
|
$
|
(1,452
|
)
|
|
$
|
217,693
|
|
Net loss for the nine months ended September 29, 2018
|
—
|
|
|
—
|
|
|
—
|
|
|
(19,201
|
)
|
|
—
|
|
|
(19,201
|
)
|
|||||
Unrealized gain related to marketable securities, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16
|
|
|
16
|
|
|||||
Recognized gain on redemption of marketable securities, previously unrealized
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(18
|
)
|
|
(18
|
)
|
|||||
Translation adjustments, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,124
|
)
|
|
(1,124
|
)
|
|||||
Common stock issued in connection with the exercise of stock options, ESPP and vested RSUs, net of tax
|
5,380
|
|
|
54
|
|
|
26,397
|
|
|
—
|
|
|
—
|
|
|
26,451
|
|
|||||
Stock-based compensation related to stock options, ESPP and RSUs
|
—
|
|
|
—
|
|
|
9,908
|
|
|
—
|
|
|
—
|
|
|
9,908
|
|
|||||
Accounting method transition adjustment (1)
|
—
|
|
|
—
|
|
|
—
|
|
|
27,401
|
|
|
—
|
|
|
27,401
|
|
|||||
Balances, September 29, 2018
|
129,275
|
|
|
$
|
1,293
|
|
|
$
|
732,073
|
|
|
$
|
(469,662
|
)
|
|
$
|
(2,578
|
)
|
|
$
|
261,126
|
|
(1)
|
As of the beginning of fiscal 2018, we adopted ASC 606,
Revenue from Contracts With Customers,
using the modified retrospective transition method. As a result of this adoption, we recorded a cumulative-effect adjustment to Accumulated Deficit, as shown in the table above.
|
(In thousands)
|
Severance & related *
|
|
Lease Termination & Fixed Assets
|
|
Software Contracts & Engineering Tools **
|
|
Other
|
|
Total
|
||||||||||
Balance at December 31, 2016
|
$
|
801
|
|
|
$
|
1,036
|
|
|
$
|
25
|
|
|
$
|
12
|
|
|
$
|
1,874
|
|
Restructuring charges
|
2,433
|
|
|
816
|
|
|
686
|
|
|
778
|
|
|
4,713
|
|
|||||
Costs paid or otherwise settled
|
(1,707
|
)
|
|
(897
|
)
|
|
(711
|
)
|
|
(771
|
)
|
|
(4,086
|
)
|
|||||
Balance at September 30, 2017
|
$
|
1,527
|
|
|
$
|
955
|
|
|
$
|
—
|
|
|
$
|
19
|
|
|
$
|
2,501
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at December 30, 2017
|
$
|
1,192
|
|
|
$
|
870
|
|
|
$
|
360
|
|
|
$
|
25
|
|
|
$
|
2,447
|
|
Restructuring charges
|
4,034
|
|
|
437
|
|
|
913
|
|
|
111
|
|
|
5,495
|
|
|||||
Costs paid or otherwise settled
|
(4,662
|
)
|
|
(667
|
)
|
|
(1,055
|
)
|
|
(113
|
)
|
|
(6,497
|
)
|
|||||
Balance at September 29, 2018
|
$
|
564
|
|
|
$
|
640
|
|
|
$
|
218
|
|
|
$
|
23
|
|
|
$
|
1,445
|
|
*
|
Includes employee relocation costs and retention bonuses
|
**
|
Includes cancellation of contracts
|
(In thousands)
|
September 29,
2018 |
|
December 30,
2017 |
||||
Principal amount
|
$
|
278,908
|
|
|
$
|
306,791
|
|
Unamortized original issue discount and debt costs
|
(3,769
|
)
|
|
(5,616
|
)
|
||
Less: Current portion of long-term debt
|
(14,104
|
)
|
|
(1,508
|
)
|
||
Long-term debt
|
$
|
261,035
|
|
|
$
|
299,667
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
(In thousands)
|
September 29,
2018 |
|
September 30,
2017 |
|
September 29,
2018 |
|
September 30,
2017 |
||||||||
Contractual interest
|
$
|
4,711
|
|
|
$
|
3,492
|
|
|
$
|
14,001
|
|
|
$
|
12,202
|
|
Amortization of debt issuance costs and discount
|
789
|
|
|
326
|
|
|
1,847
|
|
|
1,680
|
|
||||
Total interest expense related to the Term Loan
|
$
|
5,500
|
|
|
$
|
3,818
|
|
|
$
|
15,848
|
|
|
$
|
13,882
|
|
Fiscal year
|
|
(in thousands)
|
||
|
|
|
||
2018 (remaining 3 months)
|
|
$
|
875
|
|
2019
|
|
15,914
|
|
|
2020
|
|
56,175
|
|
|
2021
|
|
205,944
|
|
|
|
|
$
|
278,908
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
(In thousands)
|
September 29,
2018 |
|
September 30,
2017 |
|
September 29,
2018 |
|
September 30,
2017 |
||||||||
Cost of products sold
|
$
|
219
|
|
|
$
|
154
|
|
|
$
|
652
|
|
|
$
|
562
|
|
Research and development
|
926
|
|
|
980
|
|
|
2,970
|
|
|
4,129
|
|
||||
Selling, general, and administrative
|
1,563
|
|
|
1,380
|
|
|
6,286
|
|
|
4,595
|
|
||||
Total stock-based compensation
|
$
|
2,708
|
|
|
$
|
2,514
|
|
|
$
|
9,908
|
|
|
$
|
9,286
|
|
(Shares in thousands)
|
|
Unvested
|
|
Vested
|
|
Total
|
|||
Balance, December 30, 2017
|
|
707
|
|
|
83
|
|
|
790
|
|
Granted
|
|
573
|
|
|
—
|
|
|
573
|
|
Vested
|
|
(31
|
)
|
|
31
|
|
|
—
|
|
Exercised
|
|
—
|
|
|
(78
|
)
|
|
(78
|
)
|
Canceled
|
|
(429
|
)
|
|
(10
|
)
|
|
(439
|
)
|
Balance, September 29, 2018
|
|
820
|
|
|
26
|
|
|
846
|
|
(In thousands)
|
September 29, 2018
|
|
December 30, 2017
|
||||
United States
|
$
|
27,893
|
|
|
$
|
30,338
|
|
|
|
|
|
||||
China
|
2,357
|
|
|
4,632
|
|
||
Philippines
|
3,472
|
|
|
3,883
|
|
||
Taiwan
|
1,062
|
|
|
958
|
|
||
Japan
|
319
|
|
|
313
|
|
||
Other
|
621
|
|
|
299
|
|
||
Total foreign property and equipment, net
|
7,831
|
|
|
10,085
|
|
||
Total property and equipment, net
|
$
|
35,724
|
|
|
$
|
40,423
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||||||||||
(In thousands)
|
September 29,
2018 |
|
September 30,
2017 *
|
|
September 29,
2018 |
|
September 30,
2017 *
|
||||||||||||||||||||
Revenue
|
$
|
101,484
|
|
|
100.0
|
%
|
|
$
|
91,971
|
|
|
100.0
|
%
|
|
$
|
302,822
|
|
|
100.0
|
%
|
|
$
|
290,695
|
|
|
100.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gross margin
|
58,364
|
|
|
57.5
|
|
|
53,322
|
|
|
58.0
|
|
|
165,133
|
|
|
54.5
|
|
|
165,363
|
|
|
56.9
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Research and development
|
19,131
|
|
|
18.9
|
|
|
25,648
|
|
|
27.9
|
|
|
63,153
|
|
|
20.9
|
|
|
79,857
|
|
|
27.5
|
|
||||
Selling, general and administrative
|
21,775
|
|
|
21.5
|
|
|
21,290
|
|
|
23.1
|
|
|
69,886
|
|
|
23.1
|
|
|
67,133
|
|
|
23.1
|
|
||||
Amortization of acquired intangible assets
|
3,823
|
|
|
3.8
|
|
|
8,526
|
|
|
9.3
|
|
|
13,982
|
|
|
4.6
|
|
|
25,777
|
|
|
8.8
|
|
||||
Restructuring charges
|
90
|
|
|
0.1
|
|
|
3,071
|
|
|
3.3
|
|
|
5,495
|
|
|
1.8
|
|
|
4,713
|
|
|
1.6
|
|
||||
Acquisition related charges
|
—
|
|
|
—
|
|
|
681
|
|
|
0.7
|
|
|
1,531
|
|
|
0.5
|
|
|
3,208
|
|
|
1.1
|
|
||||
Impairment of intangible assets
|
586
|
|
|
0.6
|
|
|
36,198
|
|
|
39.4
|
|
|
12,486
|
|
|
4.1
|
|
|
36,198
|
|
|
12.5
|
|
||||
Gain on sale of building
|
—
|
|
|
—
|
|
|
(4,624
|
)
|
|
(5.0
|
)
|
|
—
|
|
|
—
|
|
|
(4,624
|
)
|
|
(1.6
|
)
|
||||
Income (loss) from operations
|
$
|
12,959
|
|
|
12.8
|
%
|
|
$
|
(37,468
|
)
|
|
(40.7
|
)%
|
|
$
|
(1,400
|
)
|
|
(0.5
|
)%
|
|
$
|
(46,899
|
)
|
|
(16.1
|
)%
|
Communications and Computing
|
Mobile and Consumer
|
Industrial and Automotive
|
Licensing and Services
|
Wireless
|
Smartphones
|
Security and Surveillance
|
IP Royalties
|
Wireline
|
Cameras
|
Machine Vision
|
Adopter Fees
|
Data Backhaul
|
Displays
|
Industrial Automation
|
IP Licenses
|
Computing
|
Tablets
|
Human Computer Interaction
|
Patent Sales
|
Servers
|
Wearables
|
Automotive
|
Testing Services
|
Data Storage
|
Televisions and Home Theater
|
Drones
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||||||||||
(In thousands)
|
September 29,
2018 |
|
September 30,
2017 *
|
|
September 29,
2018 |
|
September 30,
2017 * |
||||||||||||||||||||
Communications and Computing
|
$
|
32,883
|
|
|
32
|
%
|
|
$
|
27,545
|
|
|
30
|
%
|
|
$
|
90,536
|
|
|
30
|
%
|
|
$
|
84,594
|
|
|
29
|
%
|
Mobile and Consumer
|
26,974
|
|
|
27
|
|
|
25,901
|
|
|
28
|
|
|
77,980
|
|
|
26
|
|
|
82,819
|
|
|
29
|
|
||||
Industrial and Automotive
|
38,075
|
|
|
37
|
|
|
33,923
|
|
|
37
|
|
|
122,819
|
|
|
40
|
|
|
95,793
|
|
|
33
|
|
||||
Licensing and Services
|
3,552
|
|
|
4
|
|
|
4,602
|
|
|
5
|
|
|
11,487
|
|
|
4
|
|
|
27,489
|
|
|
9
|
|
||||
Total revenue
|
$
|
101,484
|
|
|
100
|
%
|
|
$
|
91,971
|
|
|
100
|
%
|
|
$
|
302,822
|
|
|
100
|
%
|
|
$
|
290,695
|
|
|
100
|
%
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||||||||||
(In thousands)
|
September 29,
2018 |
|
September 30,
2017 * |
|
September 29,
2018 |
|
September 30,
2017 * |
||||||||||||||||||||
Asia
|
$
|
76,927
|
|
|
76
|
%
|
|
$
|
68,677
|
|
|
75
|
%
|
|
$
|
226,747
|
|
|
75
|
%
|
|
$
|
207,081
|
|
|
71
|
%
|
Europe
|
11,873
|
|
|
12
|
|
|
10,972
|
|
|
12
|
|
|
36,177
|
|
|
12
|
|
|
32,631
|
|
|
11
|
|
||||
Americas
|
12,684
|
|
|
12
|
|
|
12,322
|
|
|
13
|
|
|
39,898
|
|
|
13
|
|
|
50,983
|
|
|
18
|
|
||||
Total revenue
|
$
|
101,484
|
|
|
100
|
%
|
|
$
|
91,971
|
|
|
100
|
%
|
|
$
|
302,822
|
|
|
100
|
%
|
|
$
|
290,695
|
|
|
100
|
%
|
|
% of Total Revenue
|
|
% of Total Revenue
|
||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||
|
September 29, 2018
|
|
September 30,
2017 * |
|
September 29, 2018
|
|
September 30,
2017 * |
||||
Arrow Electronics Inc.
|
24
|
%
|
|
27
|
%
|
|
30
|
%
|
|
24
|
%
|
Weikeng Group
|
27
|
|
|
26
|
|
|
26
|
|
|
27
|
|
All others
|
31
|
|
|
27
|
|
|
29
|
|
|
24
|
|
All distributors **
|
82
|
%
|
|
80
|
%
|
|
85
|
%
|
|
75
|
%
|
*
|
Results for periods in 2017 are presented in accordance with ASC 605, which was in effect during that fiscal year.
|
**
|
During the first quarter of 2018, we updated our channel categories to group all forms of distribution into a single channel. Prior periods have been reclassified to match current period presentation.
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
(In thousands)
|
September 29,
2018 |
|
September 30,
2017 |
|
September 29,
2018 |
|
September 30,
2017 |
||||||||
Gross margin
|
$
|
58,364
|
|
|
$
|
53,322
|
|
|
$
|
165,133
|
|
|
$
|
165,363
|
|
Percentage of net revenue
|
57.5
|
%
|
|
58.0
|
%
|
|
54.5
|
%
|
|
56.9
|
%
|
||||
Product gross margin %
|
56.0
|
%
|
|
56.5
|
%
|
|
52.8
|
%
|
|
54.3
|
%
|
||||
Licensing and services gross margin %
|
100.0
|
%
|
|
86.6
|
%
|
|
97.7
|
%
|
|
82.0
|
%
|
|
Three Months Ended
|
|
|
|
Nine Months Ended
|
|
|
||||||||||||
(In thousands)
|
September 29,
2018 |
|
September 30,
2017 |
|
% change
|
|
September 29,
2018 |
|
September 30,
2017 |
|
% change
|
||||||||
Research and development
|
$
|
19,131
|
|
|
$
|
25,648
|
|
|
(25)
|
|
$
|
63,153
|
|
|
$
|
79,857
|
|
|
(21)
|
Percentage of revenue
|
18.9
|
%
|
|
27.9
|
%
|
|
|
|
20.9
|
%
|
|
27.5
|
%
|
|
|
||||
Mask costs included in Research and development
|
$
|
—
|
|
|
$
|
(82
|
)
|
|
(100)
|
|
$
|
521
|
|
|
$
|
978
|
|
|
(47)
|
|
Three Months Ended
|
|
|
|
Nine Months Ended
|
|
|
||||||||||||
(In thousands)
|
September 29,
2018 |
|
September 30,
2017 |
|
% change
|
|
September 29,
2018 |
|
September 30,
2017 |
|
% change
|
||||||||
Selling, general, and administrative
|
$
|
21,775
|
|
|
$
|
21,290
|
|
|
2
|
|
$
|
69,886
|
|
|
$
|
67,133
|
|
|
4
|
Percentage of revenue
|
21.5
|
%
|
|
23.1
|
%
|
|
|
|
23.1
|
%
|
|
23.1
|
%
|
|
|
|
Three Months Ended
|
|
|
|
Nine Months Ended
|
|
|
||||||||||||
(In thousands)
|
September 29,
2018 |
|
September 30,
2017 |
|
% change
|
|
September 29,
2018 |
|
September 30,
2017 |
|
% change
|
||||||||
Amortization of acquired intangible assets
|
$
|
3,823
|
|
|
$
|
8,526
|
|
|
(55)
|
|
$
|
13,982
|
|
|
$
|
25,777
|
|
|
(46)
|
Percentage of revenue
|
3.8
|
%
|
|
9.3
|
%
|
|
|
|
4.6
|
%
|
|
8.8
|
%
|
|
|
|
Three Months Ended
|
|
|
|
Nine Months Ended
|
|
|
||||||||||||
(In thousands)
|
September 29,
2018 |
|
September 30,
2017 |
|
% change
|
|
September 29,
2018 |
|
September 30,
2017 |
|
% change
|
||||||||
Restructuring charges
|
$
|
90
|
|
|
$
|
3,071
|
|
|
(97)
|
|
$
|
5,495
|
|
|
$
|
4,713
|
|
|
17
|
Percentage of revenue
|
0.1
|
%
|
|
3.3
|
%
|
|
|
|
1.8
|
%
|
|
1.6
|
%
|
|
|
|
Three Months Ended
|
|
|
|
Nine Months Ended
|
|
|
||||||||||||
(In thousands)
|
September 29,
2018 |
|
September 30,
2017 |
|
% change
|
|
September 29,
2018 |
|
September 30,
2017 |
|
% change
|
||||||||
Acquisition related charges
|
$
|
—
|
|
|
$
|
681
|
|
|
(100)
|
|
$
|
1,531
|
|
|
$
|
3,208
|
|
|
(52)
|
Percentage of revenue
|
—
|
%
|
|
0.7
|
%
|
|
|
|
0.5
|
%
|
|
1.1
|
%
|
|
|
|
Three Months Ended
|
|
|
|
Nine Months Ended
|
|
|
||||||||||||
(In thousands)
|
September 29,
2018 |
|
September 30,
2017 |
|
% change
|
|
September 29,
2018 |
|
September 30,
2017 |
|
% change
|
||||||||
Impairment of intangible assets
|
$
|
586
|
|
|
$
|
36,198
|
|
|
(98)
|
|
$
|
12,486
|
|
|
$
|
36,198
|
|
|
(66)
|
Percentage of revenue
|
0.6
|
%
|
|
39.4
|
%
|
|
|
|
4.1
|
%
|
|
12.5
|
%
|
|
|
|
Three Months Ended
|
|
|
|
Nine Months Ended
|
|
|
||||||||||||
(In thousands)
|
September 29,
2018 |
|
September 30,
2017 |
|
% change
|
|
September 29,
2018 |
|
September 30,
2017 |
|
% change
|
||||||||
Interest expense
|
$
|
(5,500
|
)
|
|
$
|
(3,888
|
)
|
|
41
|
|
$
|
(15,582
|
)
|
|
$
|
(14,112
|
)
|
|
10
|
Percentage of revenue
|
(5.4
|
)%
|
|
(4.2
|
)%
|
|
|
|
(5.1
|
)%
|
|
(4.9
|
)%
|
|
|
|
Three Months Ended
|
|
|
|
Nine Months Ended
|
|
|
||||||||||||
(In thousands)
|
September 29,
2018 |
|
September 30,
2017 |
|
% change
|
|
September 29,
2018 |
|
September 30,
2017 |
|
% change
|
||||||||
Other expense, net
|
$
|
(452
|
)
|
|
$
|
(2,027
|
)
|
|
(78)
|
|
$
|
(246
|
)
|
|
$
|
(2,104
|
)
|
|
(88)
|
Percentage of revenue
|
(0.4
|
)%
|
|
(2.2
|
)%
|
|
|
|
(0.1
|
)%
|
|
(0.7
|
)%
|
|
|
|
Three Months Ended
|
|
|
|
Nine Months Ended
|
|
|
||||||||||||
(In thousands)
|
September 29,
2018 |
|
September 30,
2017 |
|
% change
|
|
September 29,
2018 |
|
September 30,
2017 |
|
% change
|
||||||||
Income tax expense (benefit)
|
$
|
33
|
|
|
$
|
(331
|
)
|
|
(+100)
|
|
$
|
1,973
|
|
|
$
|
234
|
|
|
+100
|
(In thousands)
|
September 29, 2018
|
|
December 30, 2017
|
|
$ Change
|
||||||
Cash and cash equivalents
|
$
|
107,893
|
|
|
$
|
106,815
|
|
|
$
|
1,078
|
|
Short-term marketable securities
|
9,600
|
|
|
4,982
|
|
|
4,618
|
|
|||
Total Cash and cash equivalents and Short-term marketable securities
|
$
|
117,493
|
|
|
$
|
111,797
|
|
|
$
|
5,696
|
|
(In thousands)
|
September 29, 2018
|
|
December 30, 2017
|
|
Change
|
||||||
Accounts receivable, net
|
$
|
75,648
|
|
|
$
|
55,104
|
|
|
$
|
20,544
|
|
Days sales outstanding - Overall
|
68
|
|
|
53
|
|
|
15
|
|
(In thousands)
|
September 29, 2018
|
|
December 30, 2017
|
|
Change
|
||||||
Inventories
|
$
|
66,381
|
|
|
$
|
79,903
|
|
|
$
|
(13,522
|
)
|
Months of inventory on hand
|
4.6
|
|
|
5.4
|
|
|
(0.8
|
)
|
Reconciliation of U.S. GAAP to Non-GAAP Financial Measures (continued)
|
|||||||||||||||
|
|
|
|
|
|
||||||||||
(In thousands, except per share data)
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
(unaudited)
|
September 29,
2018 |
|
September 30,
2017 |
|
September 29,
2018 |
|
September 30,
2017 |
||||||||
|
|
|
|
|
|
|
|
||||||||
Net Income (Loss) Per Share Reconciliation
|
|
|
|
|
|
|
|
||||||||
GAAP Net income (loss) per share - basic and diluted
|
$
|
0.05
|
|
|
$
|
(0.35
|
)
|
|
$
|
(0.15
|
)
|
|
$
|
(0.52
|
)
|
Cumulative effect of Non-GAAP adjustments
|
0.06
|
|
|
0.39
|
|
|
0.41
|
|
|
0.62
|
|
||||
Non-GAAP Net income per share - basic and diluted
|
$
|
0.11
|
|
|
$
|
0.04
|
|
|
$
|
0.26
|
|
|
$
|
0.10
|
|
|
|
|
|
|
|
|
|
||||||||
Shares used in per share calculations:
|
|
|
|
|
|
|
|
||||||||
Basic
|
127,816
|
|
|
122,990
|
|
|
125,578
|
|
|
122,393
|
|
||||
Diluted - GAAP
|
129,474
|
|
|
122,990
|
|
|
125,578
|
|
|
122,393
|
|
||||
Diluted - non-GAAP (3)
|
129,474
|
|
|
124,225
|
|
|
126,862
|
|
|
124,454
|
|
(3)
|
Diluted shares are calculated using the GAAP treasury stock method. In a loss position, diluted shares equal basic shares.
|
|
|
September 29,
2018 |
|
December 30,
2017 |
||||
Total cost of contracts for Japanese yen
(in thousands)
|
|
$
|
1,955
|
|
|
$
|
2,204
|
|
Number of contracts
|
|
2
|
|
|
2
|
|
||
Settlement month
|
|
June 2019
|
|
|
June 2018
|
|
•
|
Timely reviews with the Controller and/or CFO regarding technical accounting conclusions to ensure an effective risk assessment is performed to identify and assess changes within the business and external environment that may impact financial reporting;
|
•
|
Routine Disclosure Committee meetings to highlight and identify unique or non-recurring transactions or events, the accounting for these matters and the associated relevant risk assessments;
|
•
|
Expanded and augmented the members of the Disclosure Committee to include representatives from the Executive Leadership Team; and
|
•
|
Continue the risk assessment reviews, as warranted, with the Audit Committee
|
•
|
timely completion and introduction of new product designs;
|
•
|
ability to generate new design opportunities and design wins, including those which result in sales of significant volume;
|
•
|
availability of specialized field application engineering resources supporting demand creation and customer adoption of new products;
|
•
|
ability to utilize advanced manufacturing process technologies;
|
•
|
achieving acceptable yields and obtaining adequate production capacity from our wafer foundries and assembly and test subcontractors;
|
•
|
ability to obtain advanced packaging;
|
•
|
availability of supporting software design tools;
|
•
|
utilization of predefined IP logic;
|
•
|
market acceptance of our MHL-enabled and mobile products;
|
•
|
customer acceptance of advanced features in our new products;
|
•
|
availability of competing alternative technologies; and
|
•
|
market acceptance of our customers' products.
|
•
|
changes in local economic conditions;
|
•
|
currency exchange rate volatility;
|
•
|
governmental stimulus packages, controls, tariffs and trade disputes or restrictions;
|
•
|
governmental policies that promote development and consumption of domestic products;
|
•
|
export license requirements, foreign trade compliance matters, and restrictions on the use of technology;
|
•
|
political instability, war, terrorism, or pandemic disease;
|
•
|
changes in tax rates, tariffs, or freight rates;
|
•
|
reduced protection for intellectual property rights;
|
•
|
longer receivable collection periods;
|
•
|
natural or man-made disasters in the countries where we sell our products;
|
•
|
interruptions in transportation;
|
•
|
interruptions in the global communication infrastructure;
|
•
|
labor regulations; and
|
•
|
the impact of trade policy decisions on the economy.
|
•
|
we may be more vulnerable to economic downturns, less able to withstand competitive pressures, and less flexible in responding to changing business and economic conditions;
|
•
|
our cash flow from operations may be allocated to the payment of outstanding indebtedness, and not to research and development, operations or business growth;
|
•
|
we might not generate sufficient cash flow from operations or other sources to enable us to meet our payment obligations under the facility and to fund other liquidity needs;
|
•
|
our ability to make distributions to our stockholders in a sale or liquidation may be limited until any balance on the facility is repaid in full; and
|
•
|
our ability to incur additional debt, including for working capital, acquisitions, or other needs, is more limited.
|
•
|
meet the market windows for consumer products;
|
•
|
predict technology and market trends;
|
•
|
develop IP cores to meet emerging market needs;
|
•
|
develop products on a timely basis;
|
•
|
maintain multiple design wins across different markets and customers to dampen the effects of market volatility;
|
•
|
be designed into our customers' products; and
|
•
|
avoid cancellations or delay of products.
|
•
|
our ongoing business may be disrupted and our management's attention may be diverted by investment, acquisition, transition, or integration activities;
|
•
|
an acquisition or strategic investment may not perform as well or further our business strategy as we expected, and we may not integrate an acquired company or technology as successfully as we expected;
|
•
|
we may incur unexpected costs, claims, or liabilities that we assume from an acquired company or technology or that are otherwise related to an acquisition;
|
•
|
we may discover adverse conditions post-acquisition that are not covered by representations and warranties;
|
•
|
we may increase some of our risks, such as increasing customer or end product concentration;
|
•
|
we may have difficulty incorporating acquired technologies or products with our existing product lines;
|
•
|
we may have higher than anticipated costs in continuing support and development of acquired products, and in general and administrative functions that support such products;
|
•
|
we may have difficulty integrating and retaining key personnel;
|
•
|
we may have difficulty integrating business systems, processes, and tools, such as accounting software, inventory management systems, or revenue systems which may have an adverse effect on our business;
|
•
|
our liquidity and/or capital structure may be adversely impacted;
|
•
|
our strategic investments may not perform as expected;
|
•
|
we may experience unexpected changes in how we are required to account for our acquisitions and strategic investments pursuant to U.S. GAAP;
|
•
|
we may have difficulty integrating acquired entities into our global tax structure with potentially negative impacts on our effective tax rate;
|
•
|
if the acquisition or strategic investment does not perform as projected, we might take a charge to earnings due to impaired goodwill;
|
•
|
we may divest certain assets of acquired businesses, leading to charges against earnings;
|
•
|
we may experience unexpected negative responses from vendors or customers to the acquisition, which may adversely impact our operations; and
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•
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we may have difficulty integrating the processes and control environment.
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Exhibit Number
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Description
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10.1
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10.2
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10.3
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31.1
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31.2
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32.1
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32.2
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101.INS
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XBRL Instance Document
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101.SCH
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XBRL Taxonomy Extension Schema Document
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101.CAL
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XBRL Taxonomy Extension Calculation Linkbase Document
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101.DEF
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XBRL Taxonomy Extension Definition Linkbase Document
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101.LAB
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XBRL Taxonomy Extension Labels Linkbase Document
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101.PRE
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XBRL Taxonomy Extension Presentation Linkbase Document
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LATTICE SEMICONDUCTOR CORPORATION
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(Registrant)
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/s/ Max Downing
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M
AX
D
OWNING
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Chief Financial Officer
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(Duly Authorized Officer and Principal Financial and Accounting Officer)
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•
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For each month of service commencing September 1, 2017, you will receive an extra month of salary ($25,833 per month) payable at your termination, subject to the following conditions:
|
◦
|
You must enter into and not revoke the aforementioned release;
|
◦
|
The 10-K must be timely filed and the prior period material weakness must be mitigated and no new material weakness identified;
|
◦
|
You must fulfill the duties of your position and support the transition to the new CFO;
|
◦
|
The Company reserves the right to place you on paid leave in the event it determines your services are not required to and until February 28, 2019 but you will receive the entirety of your benefits through that date;
|
◦
|
Should you elect to terminate your employment prior to February 28, 2019 and provide the Company 30 days’ prior notice in advance of the termination date you will receive your Employment Agreement separation benefits but the supplemental benefit will be pro rated based on the actual time you provided service; and
|
◦
|
Should you elect to terminate your employment prior to February 28, 2019 and fail to provide the Company 30 days’ prior notice in advance of the termination date you will not receive the supplemental benefit.
|
1.
|
I have reviewed this
Quarterly Report on Form 10-Q
of Lattice Semiconductor Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
/s/ James Anderson
|
|
James Anderson
|
|
Chief Executive Officer
|
|
1.
|
I have reviewed this
Quarterly Report on Form 10-Q
of Lattice Semiconductor Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
/s/ Max Downing
|
|
Max Downing
|
|
Chief Financial Officer
|
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
/s/ James Anderson
|
|
James Anderson
|
|
Chief Executive Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
/s/ Max Downing
|
|
Max Downing
|
|
Chief Financial Officer
|