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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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14-1896129
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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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5966 La Place Court, Suite 100,
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Carlsbad,
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California
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92008
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
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Trading Symbol(s)
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Name of the exchange on which registered
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Common Stock
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MXL
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New York Stock Exchange
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Large Accelerated Filer
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Accelerated Filer
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Non-accelerated Filer
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Smaller Reporting Company
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Emerging Growth Company
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Page
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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Item 15.
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ITEM 1.
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BUSINESS
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Connected Home: Competing cable, satellite, and other broadband video and data service providers differentiate their services by offering consumers bundled video, voice, and broadband data access. Many of today’s service provider home gateway set-top boxes enable consumers to simultaneously access and manage multimedia content from multiple locations and screens in the home. These home gateway or set-top box devices are required to simultaneously receive, demodulate, and decode multiple signals spread across several channels of frequency bandwidth over a wide frequency range. In traditional set-top box architectures, each simultaneously accessed spectrum of signal is processed by a dedicated RF receiver and transmitter. In the emerging cable and satellite home gateway or media servers, content is delivered from the gateway/server to “thin” or remote IP clients that do not have traditional TV tuners. Each of these gateways and clients necessarily includes a broadband RF transceiver SoC based on MoCA, G.hn, or WiFi home data connectivity standards. As a result, the number of RF transceivers required in each gateway or client is greatly increased. For example, in order to deliver the increasing data bandwidth requirements of the home, cable MSOs have begun initial deployments of DOCSIS 3.1 equipment and services, which enable channel bonding or the concurrent reception of multiple channels of frequency bands, resulting in a higher aggregate “sum of the channels” bandwidth available to cable subscribers. With the increasing popularity of accessing multimedia content over-the-top, or OTT, via broadband-enabled streaming services, consumers are augmenting OTT multimedia content services with free over-the-air (OTA) terrestrial TV broadcast programming (also referred to as “Cord Cutting”). Therefore, cord-cutting OTT streaming media platforms also require one or more terrestrial TV RF receiver and demodulator SoC solutions.
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Infrastructure: The demand for “faster and fatter” data pipes and equipment in enterprise and telecommunications infrastructure markets is being primarily driven by the explosion of data traffic generated by mobile devices, OTT streaming video services, and cloud computing and data analytics.
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Industrial & Multi-Market: We have proven technical competency serving the connected world. Increasingly, in the industrial world, manufacturing equipment and appliances are connected to each other and to the cloud to better optimize utilization, improve power consumption, and plant management. Legacy equipment and new installations need to communicate with each other via newer and older connectivity protocol standards. This in turn creates opportunities for the growth of interface products, and interface bridge products supporting multiple protocols. We believe our interface product portfolio, which consists of serial interface, universal serial bus (USB), universal asynchronous receiver transmitter (UARTS), peripheral interconnect express (PCIe) devices, data converters, power management integrated chips (PMICs), and force touch sensing modules, creates new growth vectors across communications, industrial and multiple other end markets.
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Receiving single or multiple RF/digital communications signals spanning multiple frequency bands over a wide spectrum. Many of the advanced high data rate applications require the simultaneous RF reception of multiple channels or frequency bands in order to first aggregate, and then subsequently demodulate the data signal, which is spread over discrete disparate frequency bands. Likewise, high data rate transmission is achieved by disaggregating the user's data signal and transmitting it over multiple available frequency bands spanning a wide frequency spectrum. For example, in the cable set-top box and broadband gateway markets, it is necessary to support the simultaneous reception of multiple channels of high definition video, voice, and data applications in many system designs. OEMs meet these stringent requirements via multiple narrow or wideband RF receivers, each of which is dedicated to the reception of a single frequency band. An alternate, but highly challenging approach involves Full Spectrum Capture (FSCTM) receiver SoCs which can receive and digitize the entire available RF frequency spectrum in the transmission medium. They can then select and aggregate the relevant frequency bands over which the data is spread using analog and mixed-signal digital co-processing techniques. In conventional architectures, use of discrete multiple RF receivers is costly or unviable due to increased design complexity, overall cost, circuit board space, power consumption and heat dissipation. In addition, such implementations suffer from signal integrity issues, reliability, signal interference, and thermal challenges owing to the proximity of sensitive multiple RF receivers and discrete components in a limited PCB footprint.
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Signal Clarity Performance Requirements. In communications systems, performance is limited by the quality of the received/transmitted signal, which is referred to as the signal-to-noise ratio or dynamic range of the transceiver. The signal-to-noise ratio measures the strength of the desired signal relative to the total noise and undesired signal energy in the same channel. High definition satellite and terrestrial digital video, high capacity 5G wireless cellular data networks operating across non-contiguous wireless spectrum bands, and wired coaxial cable and power-line networks require broadband RF transceivers with large dynamic range. These transceiver systems are required to isolate the desired signals from the undesired signals, which are invariably present in the wide operating frequency range. The undesired signals not only include the noise generated by extraneous radio waves, but also interference produced by home appliances, enterprise communications equipment, and other wireless networking systems. For example, in broadband television reception, traditional RF transceiver implementations utilize expensive discrete components, such as band-pass filters, resonance elements, and varactor diodes to separate the desired signals from the interfering signals. In high speed mobile environments, diversity combining of radio signals and multi-user MIMO, in which the desired signal is spread over multiple frequency bands, is achieved using multiple RF transceivers. Analog and digital signal processing is employed to reconstruct the original signal and to improve the signal-to-noise ratio. While diversity combining of radio signals significantly improves signal-to-noise ratio, it requires sophisticated RF, analog and digital signal co-processing, and software expertise. Broadband reception and diversity combining of RF signals in mobile environments are extremely difficult to implement due to the stringent size, cost, and power consumption constraints. Also, higher order modulation of communication signals, which enables maximization of data capacity in a finite spectrum, requires extremely high signal-to-noise or dynamic range, which greatly increases the difficulty of implementing broadband systems.
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Power Consumption. Power consumption is an important consideration in consumer, broadband operator, and wired and wireless infrastructure applications. For example, in battery-operated devices such as notebooks, and voice-enabled cable modems with backup battery requirements to support E911 services, long battery life is a differentiating device attribute. In wireless infrastructure applications, the cost of provisioning power to base-
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Size. The size of electronic components, such as RF transceivers and digital signal processing SoCs, is a key consideration for system designers and the service providers that deploy them. Given the proliferation of the number of RF transceivers in broadband applications such as service provider video and data gateway markets, size is a determining factor in the selection of a silicon vendor’s component. In wired optical infrastructure applications inside data centers, rapidly increasing network server and switch face-plate density trends are aggressively driving reduction of the size of interconnects. In wireless infrastructure, space on the base-station radio towers, where the radios and modems are mounted, is highly constrained and is extremely expensive to procure. In 5G wireless access, the deployment of massive MIMO and antenna arrays and cell densification for coverage and capacity greatly increase the number of radio transceivers required in each base-station radio tower, as well as the number of base-stations in a cell.
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Optical Fiber Channel Impairments. The optical properties of the fiber material result in impairments to the optical signal as it propagates along the fiber. These impairments include not only the loss of light intensity, but also the adverse modal, chromatic, and polarization dispersion effects on light during its propagation in the fiber. These impairments degrade signal integrity, which not only reduces the maximum data throughput, but also limits the distance over which data can propagate over passive fiber. Further, electrical signal impairments are introduced in the process of conversion of optical signals to electrical signals. Therefore, RF transceivers and PHY SoCs present inside optical modules are required to correct both electrical and optical signal impairments at both ends of the fiber termination.
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Optical Device Technology. The state of the art in optical device technology today lags the rapidly increasing speed requirements of data traffic within cloud data centers and optical transport links between telecom data centers. So, there are severe physical limits to the conversion of electrical signals to optical signals and vice versa at extremely high speeds. These limitations arise from bandwidth, nonlinearities, and noise properties in lasers, modulators, and photo detectors used in optical modules.
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Form Factor. The form factor of the face plates in server, storage, switch, and networking racks in data centers limits the amount of heat that can be dissipated within an enclosure. The power consumption of electrical and optical devices inside the transceivers, to which optical fibers are connected, has been dramatically increasing. This imposes severe and costly thermal design challenges in the development of systems. As data rates have increased dramatically, the physical form of the face plates and connectors incorporating optical devices have not scaled rapidly enough to accommodate the corresponding increase in power density.
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Proprietary broadband/RF, analog and mixed-signal transceiver front ends. Our analog and mixed-signal IC designers implement complex broadband radio transceiver front ends in standard silicon CMOS processes. Our ability to integrate complex RF/Analog and mixed-signal circuits in standard CMOS processes enables single-die integration of a complete digital signal processing communication system. This results in state-of-the-art performance, highest energy efficiency or lowest power, smallest form factor, and the lowest manufacturing cost of a target function. Our high performance mixed-signal design capability, which involves the high-speed conversion of signals precisely and efficiently between analog and digital domains, is core to all our products and market applications. Our mixed-signal capabilities have allowed us to design Full Spectrum Capture™ (FSC) receivers which digitize wide swaths of frequency spectrum. For example, in cable DOCSIS3.1 data gateways, our single-chip FSC receivers digitize the entire cable spectrum and aggregate multiple frequency bands or channels using analog and digital signal co-processing to enable multi-gigabit data services. Our architectural and circuit innovations have resulted in a 100-fold reduction in power per unit bandwidth in broadband DOCSIS cable modems, while increasing the total data throughput by an even greater factor. In our latest products, which address the emerging 400Gbps high speed optical interconnect applications inside the data center, our transceivers digitize and aggregate 4 lanes of 100Gps of high-speed data signals coming across the fiber, delivering 400Gbps of data throughput. Our microwave backhaul RF transceiver constitutes the industry’s first single-chip CMOS implementation. It not only has the capability to receive signals spanning an extremely wide 5GHz to 45GHz frequency range, but it is also able to aggregate signals spread over multiple disparate frequency bands to support multi-gigabit-per-second data speeds. As a result, wireless backhaul outdoor units incorporating our solution have the lowest power consumption, smallest form factor, superior performance, and the lowest system cost of any wireless backhaul outdoor unit of which we are aware.
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Advanced digital signal processing ASIC design and algorithms. Our signal processing algorithm and digital ASIC design expertise is at the core of our ability to employ digital signal processing to enable breakthroughs in CMOS analog RF front-end design and vice-versa. For example, impairments introduced by analog systems such as power amplifiers and photonics devices are canceled using sophisticated digital signal processing algorithms to achieve superior signal quality, reduce power consumption, and improve the speed of operation. Communication systems across a range of our current and future target markets share common signal processing functions, such as efficient error control coding, compensation for transmission medium or channel induced impairments, and digital processing of wideband signals. So, algorithmic breakthroughs in one application are directly applicable to other product areas.
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Architecture and system design for highly-integrated end-to-end communication systems on a single-chip. Our novel design techniques tradeoff individual signal path circuit level performance to optimize the overall system performance. Our holistic system level design approach eliminates costly, and power-hungry overdesign of individual circuit elements in the signal path. As a result, we are able to address more complex customer problems that require a deeper understanding of the customer’s end product. Many of our products not only integrate the entire physical layer (PHY), but also implement complete protocol stacks. Examples of these products include our fully integrated single-chip solutions for in-home wireline connectivity, namely G.hn and MoCA solutions. The integration of entire systems on a single-chip reduces the number of external board-level components, decreases board space, improves performance, simplifies customers’ product design, and significantly reduces power consumption.
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Low-power design methodology. Reduced power consumption is extremely important to our end products and markets. The superior energy efficiency of our products reflects our years of cumulative experience and R&D investment in system architecture, semiconductor device modeling, and integrated circuit design expertise. At extremely high data rates, when electrical signals transit on and off the chip, there is a severe penalty in speed and power consumption. Therefore, significant reduction in power consumption of a device requires minimization of signal transitions between multiple chips. Our ability to achieve the highest levels of integration of all analog/RF and digital signal processing functionality on the same chip minimizes power consumption by eliminating such signal transitions. Our solutions disproportionately impact our end-customer’s product power dissipation, such as in cable modems, cable FDX fiber nodes, 400Gbps optical transceiver modules, and large 5G antenna radio transceiver arrays. Low power dissipation not only simplifies costly thermal design, but also eliminates the need for bulky fans and other cooling aids. This in turn improves end customer product reliability, increases the density of product features that can be supported in a compact footprint, and reduces overall system cost.
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Embedded systems architecture. Our products contain complex integrated CPU subsystems. These subsystems typically include multiple low-power microprocessor cores, bus and peripherals, memory controllers, and interrupt processing. In addition to signal processing and supervisory activity functions, we also implement multiple layers of real-time embedded firmware and protocol stacks on a single-chip. We believe our expertise and track record of successfully developing widely deployed, reliable embedded protocols for networking applications are essential to the evolution of connected home products of the future. Our firmware design capability is critical to the ease of use of our products in end customer platforms.
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Scalable Platform. Our products share a highly modular, core radio system and digital signal processing architecture, which enables us to offer fully integrated broadband RF transceiver based digital communication SoC solutions. They meet the stringent performance requirements of a wide variety of end market applications and standards. This contrasts to legacy solutions that require significant customization to conform to the various regional standards, technical performance and product feature requirements. As a result, our customers can minimize their design resources required to develop applications for multiple target markets using our “platform” solutions. In addition, we can deploy our engineering resources more efficiently to both diversify and address larger communications end markets.
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Extend Technology Leadership in RF Transceivers and RF Transceiver + Digital Signal Processing SoCs. We believe that our success thus far is largely attributable to our RF and mixed-signal design capability, as well as advanced digital design expertise. We have leveraged this core competency to develop high-performance, low-cost semiconductor solutions for broadband communications applications spanning the connected home, wireless access and backhaul network infrastructure, and high-speed fiber-optic modules for data center, metro, and long-haul infrastructure markets. The broadband market presents significant opportunities for innovation through the further integration of RF and mixed-signal functionality with digital signal processing capability in CMOS process technology. By doing so, we believe we will be able to deliver products with lower power consumption, superior performance, and increased cost benefits to system designers and service providers. We believe that our core competencies and design expertise in this market will enable us to acquire more customers and design wins over time. We will continue to invest in this capability and strive to be an innovation leader in this market.
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Leverage and Expand our Existing Customer Base. We target customers who are leaders in their respective markets. We intend to continue to focus on sales to customers who are leaders in our current target markets, and to build on our relationships with these leading customers to define and enhance our product roadmap. By solving the specific problems faced by our customers, we can minimize the risks associated with our customers’ adoption of our new integrated circuit products, and reduce the length of time from the start of product design to customer revenue. Further, engaging with market leaders will enable us to participate in emerging technology trends and new industry standards.
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Target Additional High-Growth Markets. Our core competency is in RF analog and mixed-signal integrated circuit design in CMOS process technology. Several of the technological challenges involved in developing RF solutions for video broadcasting and broadband reception are common to a majority of broader communications markets. We intend to leverage our core competency in developing highly integrated RF transceiver and RF transceiver SoCs in standard CMOS process technology to address additional markets within broadband communications, communications infrastructure, and connectivity markets that we believe offer high growth potential.
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Expand Global Presence. Due to the global nature of our supply chain and customer locations, we intend to continue to expand our sales, design and technical support organization both in the United States and overseas. In particular, we expect to align our regional support to our customer base. We believe that our customers will increasingly expect this kind of local capability and support.
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Attract and Retain Top Talent. We are committed to recruiting and retaining highly talented personnel with proven expertise in the design, development, marketing and sales of communications integrated circuits. We believe that we have assembled a high-quality team in all the areas of expertise required at an integrated circuit design
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RF Receivers. These semiconductor products combine RF receiver technology that traditionally required multiple external discrete components, such as very high frequency, or VHF, and ultra-high frequency, or UHF, tracking filters, surface acoustic wave, or SAW, filters, intermediate-frequency, or IF, amplifiers, low noise amplifiers and transformers. All of these external components have been either eliminated or integrated into a single semiconductor produced entirely in standard CMOS process technology.
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RF Receiver SoCs. These semiconductor products combine the functionality of RF receivers, and demodulators in a single chip. In some configurations, these products may incorporate multiple RF receivers and single or multiple demodulators in a single chip to provide application or market specific solutions to customers.
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Wireless Infrastructure Backhaul RF Receivers and Modem SoC's. These semiconductor products reside in wireless operator system deployments to enable communication between various metro network rings. The RF receiver is capable of receiving and transmitting signals spanning 5-45 GHz and passes the signal to the back-end modem device, which modulates one or more carrier wave signals to encode digital information for transmission and demodulate signals to decode the transmitted information. The increasing amounts of data and video content being consumed on mobile devices are creating new opportunities for innovative and efficient modem and RF receiver SoCs.
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Laser Modulator Drivers. These semiconductor products reside in optical modules and provide a constant current source that delivers exactly the current to the laser diode that it needs to operate for a particular application
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Transimpedance Amplifiers. These semiconductor products reside in optical modules and provide current-to-voltage conversion, converting the low-level current of a sensor to a voltage.
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Clock and Data Recovery Circuits. These semiconductor products generate a clock from an approximate frequency reference, and then phase-aligns to the transitions in the data stream with a phase-locked loop, or PLL.
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Interface solutions. These differentiated bridging connectivity products include USB, ethernet, PCIe, as well as UARTs, and serial transceiver devices which serve data and telecommunications, networking and storage, industrial control and embedded applications and facilitate and optimize the interface between systems and across networks.
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Power Management. These DC/DC voltage conversion and supervision products are designed to support the needs of various infrastructure, broadband, industrial and embedded system applications, including traditional linear, switching power management solutions and universal PMICs. Our proprietary and patented programmable power technology enables customers to reduce product development cycles, provides a flexible and configurable solution for control of critical attributes of the power management system and enables the system architect to design products that significantly reduce wasted energy.
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Data encryption and compression. These products offer some of the industry's lowest noise and distortion amplifiers and lowest power consumption high speed analog-to-digital converters, or ADCs. They include instrumentation, low noise, high speed and hybrid amplifiers, as well as high speed ADCs and digital-to-analog converters. Our amplifier and data converter products are designed to meet the needs of various industrial, medical, and video applications.
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product performance;
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features and functionality;
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energy efficiency;
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size;
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ease of system design;
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customer support;
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product roadmap;
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reputation;
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reliability; and
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price.
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ITEM 1A.
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RISK FACTORS
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substantially all of our sales to date have been made on a purchase order basis, which permits our customers to cancel, change or delay product purchase commitments with little or no notice to us and without penalty;
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some of our customers have sought or are seeking relationships with current or potential competitors which may affect their purchasing decisions;
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service provider and OEM consolidation across cable, satellite, and fiber markets could result in significant changes to our customers’ technology development and deployment priorities and roadmaps, which could affect our ability to forecast demand accurately and could lead to increased volatility in our business; and
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technological changes in our markets could lead to substantial volatility in our revenues based on product transitions, and particularly in our broadband markets, we face risks based on changes in the way consumers are accessing and using broadband and cable services, which could affect operator demand for our products.
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successfully develop new products and penetrate new applications and markets;
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recruit, hire, train and manage additional qualified engineers for our research and development activities, especially in the positions of design engineering, product and test engineering and applications engineering;
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add sales personnel and expand customer engineering support offices;
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implement and improve our administrative, financial and operational systems, procedures and controls; and
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enhance our information technology support for enterprise resource planning and design engineering by adapting and expanding our systems and tool capabilities, and properly training new hires as to their use.
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cease the manufacture, use or sale of the infringing products, processes or technology;
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pay substantial damages for infringement;
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expend significant resources to develop non-infringing products, processes or technology;
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license technology from the third-party claiming infringement, which license may not be available on commercially reasonable terms, or at all;
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cross-license our technology to a competitor to resolve an infringement claim, which could weaken our ability to compete with that competitor; or
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pay substantial damages to our customers or end users to discontinue their use of or to replace infringing technology sold to them with non-infringing technology.
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failure by us, our customers, or their end customers to qualify a selected supplier;
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capacity shortages during periods of high demand or from events beyond our control;
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reduced control over delivery schedules and quality;
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shortages of materials;
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misappropriation of our intellectual property;
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limited warranties on wafers or products supplied to us; and
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potential increases in prices.
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any of our present or future patents or patent claims will not lapse or be invalidated, circumvented, challenged or abandoned;
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our intellectual property rights will provide competitive advantages to us;
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our ability to assert our intellectual property rights against potential competitors or to settle current or future disputes will not be limited by our agreements with third parties;
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any of our pending or future patent applications will be issued or have the coverage originally sought;
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our intellectual property rights will be enforced in jurisdictions where competition may be intense or where legal protection may be weak;
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any of the trademarks, copyrights, trade secrets or other intellectual property rights that we presently employ in our business will not lapse or be invalidated, circumvented, challenged or abandoned; or
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we will not lose the ability to assert our intellectual property rights against or to license our technology to others and collect royalties or other payments.
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changes in end-user demand for the products manufactured and sold by our customers;
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the receipt, reduction or cancellation of significant orders by customers;
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fluctuations in the levels of component inventories held by our customers;
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the gain or loss of significant customers;
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market acceptance of our products and our customers’ products;
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our ability to develop, introduce and market new products and technologies on a timely basis;
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the timing and extent of product development costs;
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new product announcements and introductions by us or our competitors;
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incurrence of research and development and related new product expenditures;
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seasonality or cyclical fluctuations in our markets;
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trade-related government actions, by the United States, China or other countries, that impose barriers or restrictions that would impact our ability to sell or ship products to customers;
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currency fluctuations;
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fluctuations in IC manufacturing yields;
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significant warranty claims, including those not covered by our suppliers;
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changes in our product mix or customer mix;
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intellectual property disputes;
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loss of key personnel or the shortage of available skilled workers;
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impairment of long-lived assets, including masks and production equipment;
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the effects of competitive pricing pressures, including decreases in average selling prices of our products; and
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uncertainties arising from the impact of novel coronavirus on the market.
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changes in political, regulatory, legal or economic conditions;
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restrictive governmental actions, such as restrictions on the transfer or repatriation of funds and foreign investments and trade protection measures, including export duties and quotas and customs duties and tariffs;
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disruptions of capital and trading markets;
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changes in import or export licensing requirements;
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transportation delays;
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civil disturbances or political instability;
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geopolitical turmoil, including terrorism, war or political or military coups;
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public health emergencies;
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differing employment practices and labor standards;
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limitations on our ability under local laws to protect our intellectual property;
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local business and cultural factors that differ from our customary standards and practices;
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nationalization and expropriation;
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changes in tax laws;
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currency fluctuations relating to our international operating activities; and
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difficulty in obtaining distribution and support.
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authorize our Board of Directors to issue, without further action by the stockholders, up to 25,000,000 shares of undesignated preferred stock;
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require that any action to be taken by our stockholders be effected at a duly called annual or special meeting and not by written consent;
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specify that special meetings of our stockholders can be called only by our Board of Directors, our Chairman of the Board of Directors, or our President;
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establish an advance notice procedure for stockholder approvals to be brought before an annual meeting of our stockholders, including proposed nominations of persons for election to our Board of Directors;
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establish that our Board of Directors is divided into three classes, Class I, Class II and Class III, with each class serving staggered terms;
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provide that our directors may be removed only for cause;
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provide that vacancies on our Board of Directors may be filled only by a majority of directors then in office, even though less than a quorum;
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specify that no stockholder is permitted to cumulate votes at any election of directors; and
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require supermajority votes of the holders of our common stock to amend specified provisions of our charter documents.
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actual or anticipated fluctuations in our financial condition and operating results;
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overall conditions in the semiconductor market;
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addition or loss of significant customers;
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changes in laws or regulations applicable to our products;
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actual or anticipated changes in our growth rate relative to our competitors;
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announcements of technological innovations by us or our competitors;
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announcements by us or our competitors of significant acquisitions, strategic partnerships, joint ventures or capital commitments;
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additions or departures of key personnel;
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competition from existing products or new products that may emerge;
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issuance of new or updated research or reports by securities analysts;
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fluctuations in the valuation of companies perceived by investors to be comparable to us;
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disputes or other developments related to proprietary rights, including patents, litigation matters and our ability to obtain intellectual property protection for our technologies;
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acquisitions, if applicable, may not be accretive and may cause dilution to our earnings per shares;
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announcement or expectation of additional financing efforts;
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sales of our common stock by us or our stockholders; and
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general economic and market conditions.
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issuances of equity securities dilutive to our existing stockholders;
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substantial cash payments;
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the incurrence of substantial debt and assumption of unknown liabilities;
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large one-time write-offs;
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amortization expenses related to intangible assets;
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a limitation on our ability to use our net operating loss carryforwards;
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the diversion of management's time and attention from operating our business to acquisition integration challenges;
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stockholder or other litigation relating to the transaction;
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adverse tax consequences; and
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•
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the potential loss of key employees, customers and suppliers of the acquired businesses.
|
•
|
failure to successfully further develop the acquired products or technology;
|
•
|
conforming the acquired company’s standards, policies, processes, procedures and controls with our operations;
|
•
|
coordinating new product and process development, especially with respect to highly complex technologies;
|
•
|
loss of key employees or customers of the acquired company;
|
•
|
hiring additional management and other critical personnel;
|
•
|
in the case of foreign acquisitions, the need to integrate operations across different cultures and languages and to address the particular economic, currency, political and regulatory risks associated with specific countries;
|
•
|
increasing the scope, geographic diversity and complexity of our operations;
|
•
|
consolidation of facilities, integration of the acquired company’s accounting, human resource and other administrative functions and coordination of product, engineering and sales and marketing functions;
|
•
|
the geographic distance between the companies;
|
•
|
liability for activities of the acquired company before the acquisition, including patent and trademark infringement claims, violations of laws, commercial disputes, tax liabilities and other known and unknown liabilities; and
|
•
|
litigation or other claims in connection with the acquired company, including claims for terminated employees, customers, former stockholders or other third parties.
|
•
|
our ability to obtain any necessary financing in the future for working capital, capital expenditures, debt service requirements, or other purposes may be limited or financing may be unavailable;
|
•
|
a substantial portion of our cash flows must be dedicated to the payment of principal and interest on our indebtedness and other obligations and will not be available for use in our business;
|
•
|
our level of indebtedness could limit our flexibility in planning for, or reacting to, changes in our business and the markets in which we operate;
|
•
|
our high degree of indebtedness will make us more vulnerable to changes in general economic conditions and/or a downturn in our business, thereby making it more difficult for us to satisfy our obligations;
|
•
|
we are subject to a fixed rate of interest through October 2020 as a result of entering into a fixed-for-floating interest rate swap agreement in November 2017 to hedge against the potential that the interest rates applicable to our term loan will increase. Our interest rate under the term loan varies based on a fixed margin over either an adjusted LIBOR or an adjusted base rate. Interest rate trends are inherently difficult to predict and interest rates may significantly increase or decrease over a short period of time. If interest rates were to decrease substantially, we would pay higher interest expense than market and, as a result, could seek to terminate or modify the terms of the swap prior to its maturity which could result in termination or other fees and the fair value of our interest rate swap may also decrease substantially; and
|
•
|
we are also still subject to variable interest rate risk on the principal balance in excess of the notional amount of the interest rate swap because our interest rate under the term loan varies based on a fixed margin over either an adjusted LIBOR or an adjusted base rate. Interest rates, including LIBOR, may increase in future periods. If we are unable to make anticipated prepayments of our indebtedness causing the unhedged portion of our indebtedness to substantially increase at the same time that interest rates were to increase substantially, it would adversely affect our operating results and could affect our ability to service the term loan indebtedness.
|
ITEM 1B.
|
UNRESOLVED STAFF COMMENTS
|
ITEM 2.
|
PROPERTIES
|
ITEM 3.
|
LEGAL PROCEEDINGS
|
ITEM 4.
|
MINE SAFETY DISCLOSURES
|
ITEM 5.
|
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|
ITEM 6.
|
SELECTED FINANCIAL DATA
|
|
Years Ended December 31,
|
||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
|
(in thousands, except per share amounts)
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Consolidated Statement of Operations Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net revenue
|
$
|
317,180
|
|
|
$
|
384,997
|
|
|
$
|
420,318
|
|
|
$
|
387,832
|
|
|
$
|
300,360
|
|
Cost of net revenue
|
149,495
|
|
|
176,223
|
|
|
212,355
|
|
|
157,842
|
|
|
144,937
|
|
|||||
Gross profit
|
167,685
|
|
|
208,774
|
|
|
207,963
|
|
|
229,990
|
|
|
155,423
|
|
|||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Research and development
|
98,344
|
|
|
120,046
|
|
|
112,279
|
|
|
97,745
|
|
|
85,405
|
|
|||||
Selling, general and administrative
|
88,762
|
|
|
101,789
|
|
|
105,831
|
|
|
64,454
|
|
|
77,981
|
|
|||||
Impairment losses
|
—
|
|
|
2,198
|
|
|
2,000
|
|
|
1,300
|
|
|
21,600
|
|
|||||
Restructuring charges
|
2,636
|
|
|
3,838
|
|
|
9,524
|
|
|
3,432
|
|
|
14,086
|
|
|||||
Total operating expenses
|
189,742
|
|
|
227,871
|
|
|
229,634
|
|
|
166,931
|
|
|
199,072
|
|
|||||
Income (loss) from operations
|
(22,057
|
)
|
|
(19,097
|
)
|
|
(21,671
|
)
|
|
63,059
|
|
|
(43,649
|
)
|
|||||
Interest income
|
775
|
|
|
78
|
|
|
274
|
|
|
572
|
|
|
275
|
|
|||||
Interest expense
|
(11,133
|
)
|
|
(14,255
|
)
|
|
(10,378
|
)
|
|
(104
|
)
|
|
(100
|
)
|
|||||
Other income (expense), net
|
(69
|
)
|
|
422
|
|
|
(2,223
|
)
|
|
163
|
|
|
568
|
|
|||||
Total interest and other income (expense), net
|
(10,427
|
)
|
|
(13,755
|
)
|
|
(12,327
|
)
|
|
631
|
|
|
743
|
|
|||||
Income (loss) before income taxes
|
(32,484
|
)
|
|
(32,852
|
)
|
|
(33,998
|
)
|
|
63,690
|
|
|
(42,906
|
)
|
|||||
Income tax provision (benefit)
|
(12,586
|
)
|
|
(6,653
|
)
|
|
(24,811
|
)
|
|
2,398
|
|
|
(575
|
)
|
|||||
Net income (loss)
|
$
|
(19,898
|
)
|
|
$
|
(26,199
|
)
|
|
$
|
(9,187
|
)
|
|
$
|
61,292
|
|
|
$
|
(42,331
|
)
|
Net income (loss) per share:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
$
|
(0.28
|
)
|
|
$
|
(0.38
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
0.96
|
|
|
$
|
(0.79
|
)
|
Diluted
|
$
|
(0.28
|
)
|
|
$
|
(0.38
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
0.91
|
|
|
$
|
(0.79
|
)
|
Shares used to compute net income (loss) per share:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
71,005
|
|
|
68,490
|
|
|
66,252
|
|
|
63,781
|
|
|
53,378
|
|
|||||
Diluted
|
71,005
|
|
|
68,490
|
|
|
66,252
|
|
|
67,653
|
|
|
53,378
|
|
|
As of December 31,
|
||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Consolidated Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash, cash equivalents, restricted cash, and short- and long-term investments, available-for-sale
|
$
|
93,117
|
|
|
$
|
74,191
|
|
|
$
|
74,412
|
|
|
$
|
136,805
|
|
|
$
|
130,498
|
|
Working capital
|
115,208
|
|
|
110,044
|
|
|
124,918
|
|
|
158,304
|
|
|
134,170
|
|
|||||
Total assets
|
705,791
|
|
|
743,593
|
|
|
824,862
|
|
|
422,652
|
|
|
334,505
|
|
|||||
Total stockholders’ equity
|
414,920
|
|
|
399,936
|
|
|
387,424
|
|
|
352,424
|
|
|
262,924
|
|
ITEM 7.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
|
Years Ended December 31,
|
||||
|
2019
|
|
2018
|
||
Net revenue
|
100
|
%
|
|
100
|
%
|
Cost of net revenue
|
47
|
|
|
46
|
|
Gross profit
|
53
|
|
|
54
|
|
Operating expenses:
|
|
|
|
||
Research and development
|
31
|
|
|
31
|
|
Selling, general and administrative
|
28
|
|
|
26
|
|
Impairment losses
|
—
|
|
|
1
|
|
Restructuring charges
|
1
|
|
|
1
|
|
Total operating expenses
|
60
|
|
|
59
|
|
Loss from operations
|
(7
|
)
|
|
(5
|
)
|
Total interest and other income (expense), net
|
(3
|
)
|
|
(4
|
)
|
Loss before income taxes
|
(10
|
)
|
|
(9
|
)
|
Income tax benefit
|
(4
|
)
|
|
(2
|
)
|
Net loss
|
(6
|
)%
|
|
(7
|
)%
|
|
Year Ended December 31,
|
|
% Change
|
|||||||
|
2019
|
|
2018
|
|
2019
|
|||||
|
(dollars in thousands)
|
|
|
|||||||
Connected home
|
$
|
152,674
|
|
|
$
|
207,336
|
|
|
(26
|
)%
|
% of net revenue
|
48
|
%
|
|
54
|
%
|
|
|
|||
Infrastructure
|
85,369
|
|
|
82,388
|
|
|
4
|
%
|
||
% of net revenue
|
27
|
%
|
|
21
|
%
|
|
|
|||
Industrial and multi-market
|
79,137
|
|
|
95,273
|
|
|
(17
|
)%
|
||
% of net revenue
|
25
|
%
|
|
25
|
%
|
|
|
|||
Total net revenue
|
$
|
317,180
|
|
|
$
|
384,997
|
|
|
(18
|
)%
|
|
Year Ended December 31,
|
|
% Change
|
|||||||
|
2019
|
|
2018
|
|
2019
|
|||||
|
(dollars in thousands)
|
|
|
|||||||
Cost of net revenue
|
$
|
149,495
|
|
|
$
|
176,223
|
|
|
(15
|
)%
|
% of net revenue
|
47
|
%
|
|
46
|
%
|
|
|
|||
Gross profit
|
167,685
|
|
|
208,774
|
|
|
(20
|
)%
|
||
% of net revenue
|
53
|
%
|
|
54
|
%
|
|
|
|
Year Ended December 31,
|
|
% Change
|
|||||||
|
2019
|
|
2018
|
|
2019
|
|||||
|
(dollars in thousands)
|
|
|
|||||||
Research and development
|
$
|
98,344
|
|
|
$
|
120,046
|
|
|
(18
|
)%
|
% of net revenue
|
31
|
%
|
|
31
|
%
|
|
|
|
Year Ended December 31,
|
|
% Change
|
|||||||
|
2019
|
|
2018
|
|
2019
|
|||||
|
(dollars in thousands)
|
|
|
|||||||
Selling, general and administrative
|
$
|
88,762
|
|
|
$
|
101,789
|
|
|
(13
|
)%
|
% of net revenue
|
28
|
%
|
|
26
|
%
|
|
|
|
Year Ended December 31,
|
|
% Change
|
||||||
|
2019
|
|
2018
|
|
2019
|
||||
|
(dollars in thousands)
|
|
|
||||||
Impairment losses
|
$
|
—
|
|
|
$
|
2,198
|
|
|
(100)%
|
% of net revenue
|
—
|
%
|
|
1
|
%
|
|
|
|
Year Ended December 31,
|
|
% Change
|
||||||
|
2019
|
|
2018
|
|
2019
|
||||
|
(dollars in thousands)
|
|
|
||||||
Restructuring charges
|
$
|
2,636
|
|
|
$
|
3,838
|
|
|
(31)%
|
% of net revenue
|
1
|
%
|
|
1
|
%
|
|
|
|
Year Ended December 31,
|
|
% Change
|
|||||||
|
2019
|
|
2018
|
|
2019
|
|||||
|
(dollars in thousands)
|
|
|
|||||||
Interest and other income (expense), net
|
$
|
(10,427
|
)
|
|
$
|
(13,755
|
)
|
|
(24
|
)%
|
% of net revenue
|
(3
|
)%
|
|
(4
|
)%
|
|
|
|
Year Ended December 31,
|
|
% Change
|
|||||||
|
2019
|
|
2018
|
|
2019
|
|||||
|
(dollars in thousands)
|
|
|
|||||||
Income tax benefit
|
$
|
(12,586
|
)
|
|
$
|
(6,653
|
)
|
|
89
|
%
|
% of pre-tax loss
|
39
|
%
|
|
20
|
%
|
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in thousands)
|
||||||
Working capital
|
$
|
115,208
|
|
|
$
|
110,044
|
|
|
|
|
|
||||
Cash and cash equivalents
|
$
|
92,708
|
|
|
$
|
73,142
|
|
Short-term restricted cash
|
349
|
|
|
645
|
|
||
Long-term restricted cash
|
60
|
|
|
404
|
|
||
Total cash and cash equivalents, restricted cash and investments
|
$
|
93,117
|
|
|
$
|
74,191
|
|
|
Years Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in thousands)
|
||||||
Net cash provided by operating activities
|
$
|
78,348
|
|
|
$
|
102,689
|
|
Net cash used in investing activities
|
(6,973
|
)
|
|
(7,825
|
)
|
||
Net cash used in financing activities
|
(53,383
|
)
|
|
(93,784
|
)
|
||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
934
|
|
|
(1,301
|
)
|
||
Increase (decrease) in cash, cash equivalents and restricted cash
|
$
|
18,926
|
|
|
$
|
(221
|
)
|
|
Payments due
|
||||||||||||||
|
Total
|
|
Less than 1 year
|
|
1-3 years
|
|
3-5 years
|
||||||||
|
(in thousands)
|
||||||||||||||
Long-term debt obligations
|
$
|
212,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
212,000
|
|
Operating lease obligations
|
15,244
|
|
|
5,406
|
|
|
8,808
|
|
|
1,030
|
|
||||
Inventory purchase obligations
|
15,093
|
|
|
15,093
|
|
|
—
|
|
|
—
|
|
||||
Other obligations
|
7,500
|
|
|
5,735
|
|
|
1,318
|
|
|
447
|
|
||||
Total
|
$
|
249,837
|
|
|
$
|
26,234
|
|
|
$
|
10,126
|
|
|
$
|
213,477
|
|
ITEM 7A.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
ITEM 8.
|
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
|
ITEM 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
ITEM 9A.
|
CONTROLS AND PROCEDURES
|
ITEM 9B.
|
OTHER INFORMATION
|
ITEM 10.
|
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
|
ITEM 11.
|
EXECUTIVE COMPENSATION
|
ITEM 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|
ITEM 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
|
ITEM 14.
|
PRINCIPAL ACCOUNTING FEES AND SERVICES
|
ITEM 15.
|
EXHIBITS, FINANCIAL STATEMENT SCHEDULES
|
Classification
|
|
Balance at beginning of year
|
|
Additions (deductions) charged to expenses
|
|
Other Additions
|
|
(Deductions)
|
|
Balance at end of year
|
||||||||||
Allowance for doubtful accounts
|
||||||||||||||||||||
2019
|
|
$
|
46
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(46
|
)
|
|
$
|
—
|
|
2018
|
|
73
|
|
|
—
|
|
|
—
|
|
|
(27
|
)
|
|
46
|
|
|||||
2017
|
|
87
|
|
|
133
|
|
|
27
|
|
|
(174
|
)
|
|
73
|
|
|||||
Warranty reserves
|
||||||||||||||||||||
2019
|
|
$
|
519
|
|
|
$
|
74
|
|
|
$
|
—
|
|
|
$
|
(40
|
)
|
|
$
|
553
|
|
2018
|
|
941
|
|
|
(414
|
)
|
|
—
|
|
|
(8
|
)
|
|
519
|
|
|||||
2017
|
|
860
|
|
|
492
|
|
|
122
|
|
|
(533
|
)
|
|
941
|
|
|||||
Valuation allowance for deferred tax assets
|
||||||||||||||||||||
2019
|
|
$
|
79,196
|
|
|
$
|
(1,239
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
77,957
|
|
2018
|
|
84,560
|
|
|
(5,761
|
)
|
|
397
|
|
|
—
|
|
|
79,196
|
|
|||||
2017
|
|
100,284
|
|
|
(50,881
|
)
|
|
35,157
|
|
|
—
|
|
|
84,560
|
|
Exhibit Number
|
|
Exhibit Title
|
2.1
|
|
|
2.2
|
|
|
3.1
|
|
|
3.2
|
|
|
3.3
|
|
|
3.4
|
|
|
4.1
|
|
|
*4.2
|
|
|
+10.1
|
|
|
+10.2
|
|
|
+10.3
|
|
|
+10.4
|
|
|
+10.5
|
|
|
+10.6
|
|
|
+10.7
|
|
|
+10.8
|
|
|
+10.12
|
|
|
+10.13
|
|
|
10.14
|
|
|
†10.15
|
|
Exhibit Number
|
|
Exhibit Title
|
†10.16
|
|
|
+†10.17
|
|
|
†10.18
|
|
|
†10.19
|
|
|
†10.20
|
|
|
+10.21
|
|
|
+10.22
|
|
|
10.23
|
|
|
10.24
|
|
|
10.26
|
|
|
10.28
|
|
|
10.29
|
|
|
10.30
|
|
|
+10.31
|
|
|
+10.32
|
|
|
10.33
|
|
|
10.34
|
|
|
10.35
|
|
Exhibit Number
|
|
Exhibit Title
|
+10.36
|
|
|
+10.37
|
|
|
10.38
|
|
|
10.39
|
|
|
10.40
|
|
|
+10.41
|
|
|
+10.42
|
|
|
+10.43
|
|
|
+10.44
|
|
|
+10.45
|
|
|
+10.46
|
|
|
+†10.47
|
|
|
*11.1
|
|
|
*21.1
|
|
|
*23.1
|
|
|
*24.1
|
|
|
*31.1
|
|
|
*31.2
|
|
|
#*32.1
|
|
|
101.INS
|
|
XBRL Instance Document - the instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document.
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
*
|
Filed herewith.
|
#
|
In accordance with Item 601(b)(32)(ii) of Regulation S-K and SEC Release No. 33-8238 and 34-47986, Final Rule: Management’s Reports on Internal Control Over Financial Reporting and Certification of Disclosure in Exchange Act Periodic Reports, the certifications furnished pursuant to this item will not be deemed “filed” for purposes of Section 18 of the Exchange Act (15 U.S.C. 78r), or otherwise subject to the liability of that section. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act or the Exchange Act, except to the extent that the registrant specifically incorporates it by reference.
|
+
|
Indicates a management contract or compensatory plan.
|
†
|
Confidential treatment has been requested and received for certain portions of these exhibits.
|
|
|
|
|
|
MAXLINEAR, INC.
|
||
|
|
|
|
||||
|
|
|
|
|
(Registrant)
|
||
|
|
|
|
|
|||
|
|
|
|
|
By:
|
|
/s/ KISHORE SEENDRIPU, Ph.D.
|
|
|
|
|
|
|
|
Kishore Seendripu, Ph.D.
|
|
|
|
|
|
|
|
President and Chief Executive Officer
|
Date:
|
February 5, 2020
|
|
|
|
|
|
(Principal Executive Officer)
|
Signature
|
|
Title
|
|
Date
|
/s/ KISHORE SEENDRIPU, Ph.D.
|
|
President and Chief Executive Officer
|
|
February 5, 2020
|
Kishore Seendripu, Ph.D.
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
|
/s/ STEVEN G. LITCHFIELD
|
|
Chief Financial Officer and Chief Corporate Strategy Officer
|
|
February 5, 2020
|
Steven G. Litchfield
|
|
(Principal Financial Officer)
|
|
|
|
|
|
|
|
/s/ CONNIE KWONG
|
|
Corporate Controller
|
|
February 5, 2020
|
Connie Kwong
|
|
(Principal Accounting Officer)
|
|
|
|
|
|
|
|
/s/ THOMAS E. PARDUN
|
|
Lead Director
|
|
February 5, 2020
|
Thomas E. Pardun
|
|
|
|
|
|
|
|
|
|
/s/ DANIEL A. ARTUSI
|
|
Director
|
|
February 5, 2020
|
Daniel A. Artusi
|
|
|
|
|
|
|
|
|
|
/s/ CAROLYN D. BEAVER
|
|
Director
|
|
February 5, 2020
|
Carolyn D. Beaver
|
|
|
|
|
|
|
|
|
|
/s/ ALBERT J. MOYER
|
|
Director
|
|
February 5, 2020
|
Albert J. Moyer
|
|
|
|
|
|
|
|
|
|
/s/ DONALD E. SCHROCK
|
|
Director
|
|
February 5, 2020
|
Donald E. Schrock
|
|
|
|
|
|
|
|
|
|
/s/ THEODORE TEWKSBURY, Ph.D.
|
|
Director
|
|
February 5, 2020
|
Theodore Tewksbury, Ph.D.
|
|
|
|
|
•
|
Evaluating management’s assumptions with regard to future demand by considering whether:
|
◦
|
Current and past results indicated management’s ability to reliably forecast future demand. We compared prior year forecasts of future demand to actual results in the current year;
|
◦
|
Changes contemplated in forecasted future demand compared with the current year actual results are reasonable; and
|
◦
|
The information was consistent with evidence obtained in other areas of the audit;
|
•
|
Evaluating the propriety of significant adjustments to the inventory valuation calculations, if any, by making inquiries of management and reviewing judgments, assumptions and documentation supporting such adjustments;
|
•
|
Testing the completeness, accuracy, and relevance of underlying data used in the estimate of net realizable value of its inventories; and
|
•
|
Testing the design and operating effectiveness of internal controls over the inventory valuation adjustments, including management’s review of the demand forecast.
|
•
|
Reviewing management’s application of the rules under the Tax Act with a focus on Global Intangible Low-Taxed Income and the ordering rules and its expected impact on estimated future taxable income;
|
•
|
Comparing the scheduled reversals of deferred tax liabilities to the underlying financial and tax accounting records;
|
•
|
Comparing the forecast of future taxable income to the following:
|
◦
|
Prior year actual results by jurisdiction to evaluate the reasonableness of significant changes contemplated for the following year;
|
◦
|
Forecasts of future information used in other areas, such as inventory valuation and impairment assessment of intangible assets, to evaluate completeness and consistency;
|
•
|
Reviewing the Company’s transfer pricing assumptions, including royalty rates and cost plus markups, regarding the arms-length nature of transactions carried out by the Company and its non-US subsidiaries; and
|
•
|
Testing the design and operating effectiveness of management’s internal controls over the completeness and accuracy of the forecast of future taxable income and the proper application of relevant tax law to support the realizability of deferred tax assets.
|
|
December 31,
|
|
December 31,
|
||||
|
2019
|
|
2018
|
||||
|
|
|
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
92,708
|
|
|
$
|
73,142
|
|
Short-term restricted cash
|
349
|
|
|
645
|
|
||
Accounts receivable, net
|
50,411
|
|
|
59,491
|
|
||
Inventory
|
31,510
|
|
|
41,738
|
|
||
Prepaid expenses and other current assets
|
6,792
|
|
|
10,357
|
|
||
Total current assets
|
181,770
|
|
|
185,373
|
|
||
Long-term restricted cash
|
60
|
|
|
404
|
|
||
Property and equipment, net
|
16,613
|
|
|
18,404
|
|
||
Leased right-of-use assets
|
10,978
|
|
|
—
|
|
||
Intangible assets, net
|
187,971
|
|
|
244,900
|
|
||
Goodwill
|
238,330
|
|
|
238,330
|
|
||
Deferred tax assets
|
67,284
|
|
|
51,518
|
|
||
Other long-term assets
|
2,785
|
|
|
4,664
|
|
||
Total assets
|
$
|
705,791
|
|
|
$
|
743,593
|
|
Liabilities and stockholders’ equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
13,442
|
|
|
$
|
15,588
|
|
Accrued price protection liability
|
12,557
|
|
|
16,454
|
|
||
Accrued expenses and other current liabilities
|
31,171
|
|
|
28,282
|
|
||
Accrued compensation
|
9,392
|
|
|
15,005
|
|
||
Total current liabilities
|
66,562
|
|
|
75,329
|
|
||
Long-term lease liabilities
|
9,335
|
|
|
4,097
|
|
||
Long-term debt
|
206,909
|
|
|
255,757
|
|
||
Other long-term liabilities
|
8,065
|
|
|
8,474
|
|
||
Total liabilities
|
290,871
|
|
|
343,657
|
|
||
|
|
|
|
||||
Commitments and contingencies
|
|
|
|
|
|
||
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock, $0.0001 par value; 25,000 shares authorized, no shares issued or outstanding
|
—
|
|
|
—
|
|
||
Common stock, $0.0001 par value; 550,000 shares authorized, 71,931 shares issued and outstanding at December 31, 2019 and 69,551 shares issued and outstanding at December 31, 2018
|
7
|
|
|
7
|
|
||
Additional paid-in capital
|
529,596
|
|
|
493,287
|
|
||
Accumulated other comprehensive income (loss)
|
(887
|
)
|
|
272
|
|
||
Accumulated deficit
|
(113,796
|
)
|
|
(93,630
|
)
|
||
Total stockholders’ equity
|
414,920
|
|
|
399,936
|
|
||
Total liabilities and stockholders’ equity
|
$
|
705,791
|
|
|
$
|
743,593
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Net revenue
|
$
|
317,180
|
|
|
$
|
384,997
|
|
|
$
|
420,318
|
|
Cost of net revenue
|
149,495
|
|
|
176,223
|
|
|
212,355
|
|
|||
Gross profit
|
167,685
|
|
|
208,774
|
|
|
207,963
|
|
|||
Operating expenses:
|
|
|
|
|
|
||||||
Research and development
|
98,344
|
|
|
120,046
|
|
|
112,279
|
|
|||
Selling, general and administrative
|
88,762
|
|
|
101,789
|
|
|
105,831
|
|
|||
Impairment losses
|
—
|
|
|
2,198
|
|
|
2,000
|
|
|||
Restructuring charges
|
2,636
|
|
|
3,838
|
|
|
9,524
|
|
|||
Total operating expenses
|
189,742
|
|
|
227,871
|
|
|
229,634
|
|
|||
Loss from operations
|
(22,057
|
)
|
|
(19,097
|
)
|
|
(21,671
|
)
|
|||
Interest income
|
775
|
|
|
78
|
|
|
274
|
|
|||
Interest expense
|
(11,133
|
)
|
|
(14,255
|
)
|
|
(10,378
|
)
|
|||
Other income (expense), net
|
(69
|
)
|
|
422
|
|
|
(2,223
|
)
|
|||
Total interest and other income (expense), net
|
(10,427
|
)
|
|
(13,755
|
)
|
|
(12,327
|
)
|
|||
Loss before income taxes
|
(32,484
|
)
|
|
(32,852
|
)
|
|
(33,998
|
)
|
|||
Income tax benefit
|
(12,586
|
)
|
|
(6,653
|
)
|
|
(24,811
|
)
|
|||
Net loss
|
$
|
(19,898
|
)
|
|
$
|
(26,199
|
)
|
|
$
|
(9,187
|
)
|
Net loss per share:
|
|
|
|
|
|
||||||
Basic
|
$
|
(0.28
|
)
|
|
$
|
(0.38
|
)
|
|
$
|
(0.14
|
)
|
Diluted
|
$
|
(0.28
|
)
|
|
$
|
(0.38
|
)
|
|
$
|
(0.14
|
)
|
Shares used to compute net loss per share:
|
|
|
|
|
|
||||||
Basic
|
71,005
|
|
|
68,490
|
|
|
66,252
|
|
|||
Diluted
|
71,005
|
|
|
68,490
|
|
|
66,252
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Net loss
|
$
|
(19,898
|
)
|
|
$
|
(26,199
|
)
|
|
$
|
(9,187
|
)
|
Other comprehensive income (loss), net of tax
|
|
|
|
|
|
||||||
Unrealized loss on investments, net of tax of $0 in 2019, 2018, and 2017
|
—
|
|
|
—
|
|
|
(55
|
)
|
|||
Less: Reclassification adjustments of unrealized loss, net of tax of $0 in 2019, 2018, and 2017
|
—
|
|
|
—
|
|
|
55
|
|
|||
Unrealized gain on investments, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|||
Foreign currency translation adjustments, net of tax expense of $136 in 2019, benefit of $200 in 2018, and benefit of $202 in 2017
|
160
|
|
|
(1,572
|
)
|
|
2,122
|
|
|||
Unrealized gain (loss) on interest rate swap, net of tax benefit of $341 in 2019, expense of $187 in 2018, and expense of $257 in 2017
|
(1,319
|
)
|
|
702
|
|
|
477
|
|
|||
Other comprehensive income (loss)
|
(1,159
|
)
|
|
(870
|
)
|
|
2,599
|
|
|||
Total comprehensive loss
|
$
|
(21,057
|
)
|
|
$
|
(27,069
|
)
|
|
$
|
(6,588
|
)
|
|
|
Common Stock
|
|
Class A
Common Stock |
|
Class B
Common Stock |
|
Additional
Paid-In Capital |
|
Accumulated
Other Comprehensive Income (Loss) |
|
Accumulated
Deficit |
|
Total
Stockholders’ Equity |
|||||||||||||||||||||||
|
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|
|
|||||||||||||||||||||
Balance at December 31, 2016
|
|
—
|
|
|
$
|
—
|
|
|
58,363
|
|
|
$
|
6
|
|
|
6,668
|
|
|
$
|
1
|
|
|
$
|
413,909
|
|
|
$
|
(1,560
|
)
|
|
$
|
(59,932
|
)
|
|
$
|
352,424
|
|
Shares repurchased and cancelled
|
|
—
|
|
|
—
|
|
|
(13
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(334
|
)
|
|
—
|
|
|
—
|
|
|
(334
|
)
|
|||||||
Conversion of Class B common stock to Class A common stock
|
|
—
|
|
|
—
|
|
|
163
|
|
|
—
|
|
|
(163
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Conversion of Class A and B common stock to common stock
|
|
65,446
|
|
|
7
|
|
|
(58,876
|
)
|
|
(6
|
)
|
|
(6,570
|
)
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Common stock issued pursuant to equity awards, net
|
|
1,738
|
|
|
—
|
|
|
363
|
|
|
—
|
|
|
65
|
|
|
—
|
|
|
398
|
|
|
—
|
|
|
—
|
|
|
398
|
|
|||||||
Vested stock-based awards assumed in acquisition
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,613
|
|
|
—
|
|
|
—
|
|
|
4,613
|
|
|||||||
Employee stock purchase plan
|
|
216
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,308
|
|
|
—
|
|
|
—
|
|
|
4,308
|
|
|||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
32,603
|
|
|
—
|
|
|
—
|
|
|
32,603
|
|
|||||||
Other comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,599
|
|
|
—
|
|
|
2,599
|
|
|||||||
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9,187
|
)
|
|
(9,187
|
)
|
|||||||
Balance at December 31, 2017
|
|
67,400
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
455,497
|
|
|
1,039
|
|
|
(69,119
|
)
|
|
387,424
|
|
|||||||
Common stock issued pursuant to equity awards, net
|
|
1,875
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,761
|
|
|
—
|
|
|
—
|
|
|
1,761
|
|
|||||||
Employee stock purchase plan
|
|
276
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,452
|
|
|
—
|
|
|
—
|
|
|
4,452
|
|
|||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
31,734
|
|
|
—
|
|
|
—
|
|
|
31,734
|
|
|||||||
Cumulative effect of adoption of new accounting principles
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(157
|
)
|
|
103
|
|
|
1,688
|
|
|
1,634
|
|
|||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(870
|
)
|
|
—
|
|
|
(870
|
)
|
|||||||
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(26,199
|
)
|
|
(26,199
|
)
|
|||||||
Balance at December 31, 2018
|
|
69,551
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
493,287
|
|
|
272
|
|
|
(93,630
|
)
|
|
399,936
|
|
|||||||
Common stock issued pursuant to equity awards, net
|
|
2,132
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
140
|
|
|
—
|
|
|
—
|
|
|
140
|
|
|||||||
Employee stock purchase plan
|
|
248
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,109
|
|
|
—
|
|
|
—
|
|
|
4,109
|
|
|||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
32,060
|
|
|
—
|
|
|
—
|
|
|
32,060
|
|
|||||||
Cumulative effect of adoption of new accounting principles
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(268
|
)
|
|
(268
|
)
|
|||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,159
|
)
|
|
—
|
|
|
(1,159
|
)
|
|||||||
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(19,898
|
)
|
|
(19,898
|
)
|
|||||||
Balance at December 31, 2019
|
|
71,931
|
|
|
$
|
7
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
529,596
|
|
|
$
|
(887
|
)
|
|
$
|
(113,796
|
)
|
|
$
|
414,920
|
|
|
Years Ended December 31,
|
||||||||||
2019
|
|
2018
|
|
2017
|
|||||||
Operating Activities
|
|
|
|
|
|
||||||
Net loss
|
$
|
(19,898
|
)
|
|
$
|
(26,199
|
)
|
|
$
|
(9,187
|
)
|
Adjustments to reconcile net loss to cash provided by operating activities:
|
|
|
|
|
|
||||||
Amortization and depreciation
|
66,401
|
|
|
79,027
|
|
|
66,738
|
|
|||
Impairment losses
|
—
|
|
|
2,198
|
|
|
2,000
|
|
|||
Provision for losses on accounts receivable
|
—
|
|
|
—
|
|
|
133
|
|
|||
Accretion of investment premiums
|
—
|
|
|
—
|
|
|
(60
|
)
|
|||
Amortization of inventory step-up
|
—
|
|
|
—
|
|
|
25,557
|
|
|||
Amortization of debt issuance costs and accretion of discount on debt and leases
|
1,577
|
|
|
1,148
|
|
|
763
|
|
|||
Stock-based compensation
|
32,060
|
|
|
31,721
|
|
|
32,668
|
|
|||
Deferred income taxes
|
(15,693
|
)
|
|
(12,144
|
)
|
|
(31,767
|
)
|
|||
Loss on disposal of property and equipment
|
46
|
|
|
430
|
|
|
168
|
|
|||
Loss on sale of available-for-sale securities
|
—
|
|
|
—
|
|
|
38
|
|
|||
Impairment of leasehold improvements
|
1,442
|
|
|
735
|
|
|
—
|
|
|||
Impairment of leased right-of-use assets
|
9,240
|
|
|
—
|
|
|
—
|
|
|||
Gain on extinguishment of lease liabilities
|
(10,437
|
)
|
|
—
|
|
|
—
|
|
|||
(Gain) loss on foreign currency
|
760
|
|
|
(809
|
)
|
|
2,153
|
|
|||
Excess tax benefits on stock-based awards
|
(4,064
|
)
|
|
(2,028
|
)
|
|
(8,559
|
)
|
|||
Changes in operating assets and liabilities, net of acquisitions:
|
|
|
|
|
|
||||||
Accounts receivable
|
9,090
|
|
|
6,595
|
|
|
(4,377
|
)
|
|||
Inventory
|
10,195
|
|
|
11,696
|
|
|
(1,788
|
)
|
|||
Prepaid expenses and other assets
|
3,805
|
|
|
1,071
|
|
|
1,272
|
|
|||
Leased right-of-use assets
|
3,044
|
|
|
—
|
|
|
—
|
|
|||
Accounts payable, accrued expenses and other current liabilities
|
1,261
|
|
|
5,923
|
|
|
(1,918
|
)
|
|||
Accrued compensation
|
2,021
|
|
|
8,961
|
|
|
1,567
|
|
|||
Deferred revenue and deferred profit
|
—
|
|
|
(138
|
)
|
|
(1,629
|
)
|
|||
Accrued price protection liability
|
(3,966
|
)
|
|
(5,117
|
)
|
|
6,395
|
|
|||
Lease liabilities
|
(8,142
|
)
|
|
—
|
|
|
—
|
|
|||
Other long-term liabilities
|
(394
|
)
|
|
(381
|
)
|
|
(5,103
|
)
|
|||
Net cash provided by operating activities
|
78,348
|
|
|
102,689
|
|
|
75,064
|
|
|||
Investing Activities
|
|
|
|
|
|
||||||
Purchases of property and equipment
|
(6,887
|
)
|
|
(7,825
|
)
|
|
(7,468
|
)
|
|||
Proceeds from sale of property and equipment
|
—
|
|
|
—
|
|
|
30
|
|
|||
Purchases of intangible assets
|
(86
|
)
|
|
—
|
|
|
(5,378
|
)
|
|||
Cash used in acquisitions, net of cash acquired
|
—
|
|
|
—
|
|
|
(473,304
|
)
|
|||
Purchases of available-for-sale securities
|
—
|
|
|
—
|
|
|
(30,577
|
)
|
|||
Maturities of available-for-sale securities
|
—
|
|
|
—
|
|
|
84,546
|
|
|||
Net cash used in investing activities
|
(6,973
|
)
|
|
(7,825
|
)
|
|
(432,151
|
)
|
|||
Financing Activities
|
|
|
|
|
|
||||||
Net proceeds from the issuance of debt
|
—
|
|
|
—
|
|
|
416,846
|
|
|||
Repayment of debt
|
(50,000
|
)
|
|
(93,000
|
)
|
|
(70,000
|
)
|
|||
Repurchases of common stock
|
—
|
|
|
—
|
|
|
(334
|
)
|
|||
Net proceeds from issuance of common stock
|
8,603
|
|
|
6,839
|
|
|
12,052
|
|
|||
Minimum tax withholding paid on behalf of employees for restricted stock units
|
(11,986
|
)
|
|
(7,623
|
)
|
|
(11,543
|
)
|
|||
Net cash provided by (used in) financing activities
|
(53,383
|
)
|
|
(93,784
|
)
|
|
347,021
|
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
934
|
|
|
(1,301
|
)
|
|
1,582
|
|
|||
Increase (decrease) in cash, cash equivalents and restricted cash
|
18,926
|
|
|
(221
|
)
|
|
(8,484
|
)
|
|||
Cash, cash equivalents and restricted cash at beginning of period
|
74,191
|
|
|
74,412
|
|
|
82,896
|
|
|||
Cash, cash equivalents and restricted cash at end of period
|
$
|
93,117
|
|
|
$
|
74,191
|
|
|
$
|
74,412
|
|
Supplemental disclosures of cash flow information:
|
|
|
|
|
|
||||||
Cash paid for interest
|
$
|
11,259
|
|
|
$
|
13,957
|
|
|
$
|
8,843
|
|
Cash paid for income taxes
|
$
|
4,417
|
|
|
$
|
5,426
|
|
|
$
|
9,435
|
|
Supplemental disclosures of non-cash investing and financing activities:
|
|
|
|
|
|
||||||
Issuance of shares for payment of bonuses
|
$
|
7,632
|
|
|
$
|
6,997
|
|
|
$
|
3,314
|
|
Issuance of restricted stock units to Physpeed continuing employees
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
818
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in thousands, except per share amounts)
|
||||||||||
Numerator:
|
|
|
|
|
|
||||||
Net loss
|
$
|
(19,898
|
)
|
|
$
|
(26,199
|
)
|
|
$
|
(9,187
|
)
|
Denominator:
|
|
|
|
|
|
||||||
Weighted average common shares outstanding—basic
|
71,005
|
|
|
68,490
|
|
|
66,252
|
|
|||
Dilutive common stock equivalents
|
—
|
|
|
—
|
|
|
—
|
|
|||
Weighted average common shares outstanding—diluted
|
71,005
|
|
|
68,490
|
|
|
66,252
|
|
|||
Net loss per share:
|
|
|
|
|
|
||||||
Basic
|
$
|
(0.28
|
)
|
|
$
|
(0.38
|
)
|
|
$
|
(0.14
|
)
|
Diluted
|
$
|
(0.28
|
)
|
|
$
|
(0.38
|
)
|
|
$
|
(0.14
|
)
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in thousands)
|
||||||||||
Employee separation expenses
|
$
|
1,150
|
|
|
$
|
2,094
|
|
|
$
|
8,353
|
|
Lease related expenses
|
1,301
|
|
|
1,608
|
|
|
1,025
|
|
|||
Other
|
185
|
|
|
136
|
|
|
146
|
|
|||
|
$
|
2,636
|
|
|
$
|
3,838
|
|
|
$
|
9,524
|
|
|
Employee Separation Expenses
|
|
Lease Related Expenses
|
|
Other
|
|
Total
|
||||||||
|
(in thousands)
|
||||||||||||||
Liability as of December 31, 2017
|
$
|
239
|
|
|
$
|
2,693
|
|
|
$
|
107
|
|
|
$
|
3,039
|
|
Restructuring charges
|
2,094
|
|
|
1,608
|
|
|
136
|
|
|
3,838
|
|
||||
Cash payments
|
(1,924
|
)
|
|
(1,884
|
)
|
|
(196
|
)
|
|
(4,004
|
)
|
||||
Non-cash charges
|
—
|
|
|
(927
|
)
|
|
—
|
|
|
(927
|
)
|
||||
Liability as of December 31, 2018
|
409
|
|
|
1,490
|
|
|
47
|
|
|
1,946
|
|
||||
Restructuring charges
|
1,150
|
|
|
1,301
|
|
|
185
|
|
|
2,636
|
|
||||
Transfer to right-of-use asset
|
—
|
|
|
(299
|
)
|
|
—
|
|
|
(299
|
)
|
||||
Cash payments
|
(1,559
|
)
|
|
(1,720
|
)
|
|
(163
|
)
|
|
(3,442
|
)
|
||||
Non-cash charges and adjustments
|
—
|
|
|
46
|
|
|
(50
|
)
|
|
(4
|
)
|
||||
Liability as of December 31, 2019
|
—
|
|
|
818
|
|
|
19
|
|
|
837
|
|
||||
Less: current portion as of December 31, 2019
|
—
|
|
|
(275
|
)
|
|
(19
|
)
|
|
(294
|
)
|
||||
Long-term portion as of December 31, 2019
|
$
|
—
|
|
|
$
|
543
|
|
|
$
|
—
|
|
|
$
|
543
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
Years Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in thousands)
|
||||||
Beginning balance
|
$
|
238,330
|
|
|
$
|
237,992
|
|
Adjustments
|
—
|
|
|
338
|
|
||
Ending balance
|
$
|
238,330
|
|
|
$
|
238,330
|
|
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
Weighted
Average
Useful Life
(in Years)
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
|
Gross Carrying Value
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
||||||||||||
|
|
|
(in thousands)
|
||||||||||||||||||||||
Licensed technology
|
3.7
|
|
$
|
2,156
|
|
|
$
|
(1,583
|
)
|
|
$
|
573
|
|
|
$
|
2,070
|
|
|
$
|
(1,130
|
)
|
|
$
|
940
|
|
Developed technology
|
6.9
|
|
243,361
|
|
|
(108,522
|
)
|
|
134,839
|
|
|
238,961
|
|
|
(74,630
|
)
|
|
164,331
|
|
||||||
Trademarks and trade names
|
6.1
|
|
13,800
|
|
|
(6,511
|
)
|
|
7,289
|
|
|
13,800
|
|
|
(4,252
|
)
|
|
9,548
|
|
||||||
Customer relationships
|
4.6
|
|
121,100
|
|
|
(75,847
|
)
|
|
45,253
|
|
|
121,100
|
|
|
(55,647
|
)
|
|
65,453
|
|
||||||
Non-compete covenants
|
3.0
|
|
1,100
|
|
|
(1,083
|
)
|
|
17
|
|
|
1,100
|
|
|
(872
|
)
|
|
228
|
|
||||||
|
6.1
|
|
$
|
381,517
|
|
|
$
|
(193,546
|
)
|
|
$
|
187,971
|
|
|
$
|
377,031
|
|
|
$
|
(136,531
|
)
|
|
$
|
240,500
|
|
|
|
Years Ended December 31,
|
||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
|
|
|
||||||||||
Cost of net revenue
|
|
$
|
33,932
|
|
|
$
|
35,821
|
|
|
$
|
25,316
|
|
Research and development
|
|
48
|
|
|
150
|
|
|
551
|
|
|||
Selling, general and administrative
|
|
23,035
|
|
|
31,976
|
|
|
28,827
|
|
|||
|
|
$
|
57,015
|
|
|
$
|
67,947
|
|
|
$
|
54,694
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
Years Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in thousands)
|
||||||
Beginning balance
|
$
|
240,500
|
|
|
$
|
310,645
|
|
Other additions
|
86
|
|
|
—
|
|
||
Transfers to developed technology from IPR&D
|
4,400
|
|
|
—
|
|
||
Amortization
|
(57,015
|
)
|
|
(67,947
|
)
|
||
Impairment losses
|
—
|
|
|
(2,198
|
)
|
||
Ending balance
|
$
|
187,971
|
|
|
$
|
240,500
|
|
|
Amortization
(in thousands)
|
||
2020
|
$
|
56,610
|
|
2021
|
55,828
|
|
|
2022
|
38,298
|
|
|
2023
|
26,075
|
|
|
2024
|
10,098
|
|
|
Thereafter
|
1,062
|
|
|
Total
|
$
|
187,971
|
|
|
Years Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in thousands)
|
||||||
Beginning balance
|
$
|
4,400
|
|
|
$
|
4,400
|
|
Transfers to developed technology from IPR&D
|
(4,400
|
)
|
|
—
|
|
||
Ending balance
|
$
|
—
|
|
|
$
|
4,400
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
|
(in thousands)
|
||||||
Assets
|
|
|
|
||||
Interest rate swap
|
$
|
—
|
|
|
$
|
1,623
|
|
|
|
|
|
||||
Liabilities
|
|
|
|
||||
Interest rate swap
|
$
|
37
|
|
|
$
|
—
|
|
|
|
|
Fair Value Measurements
|
||||||||||||
|
Balance
|
|
Quoted Prices
in Active Markets for Identical Assets (Level 1) |
|
Significant
Other Observable Inputs (Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
||||||||
|
(in thousands)
|
||||||||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Interest rate swap, December 31, 2018
|
$
|
1,623
|
|
|
$
|
—
|
|
|
$
|
1,623
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities
|
|
|
|
|
|
|
|
||||||||
Interest rate swap, December 31, 2019
|
$
|
37
|
|
|
$
|
—
|
|
|
$
|
37
|
|
|
$
|
—
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
Fair Value at December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in thousands)
|
||||||
Interest rate swap
|
|
|
|
||||
Beginning balance
|
$
|
1,623
|
|
|
$
|
734
|
|
Unrealized gain (loss) recognized in other comprehensive income (loss)
|
(1,660
|
)
|
|
889
|
|
||
Ending balance
|
$
|
(37
|
)
|
|
$
|
1,623
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
|
(in thousands)
|
||||||
Cash and cash equivalents
|
$
|
92,708
|
|
|
$
|
73,142
|
|
Short-term restricted cash
|
349
|
|
|
645
|
|
||
Long-term restricted cash
|
60
|
|
|
404
|
|
||
Total cash, cash equivalents and restricted cash
|
$
|
93,117
|
|
|
$
|
74,191
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
|
(in thousands)
|
||||||
Work-in-process
|
$
|
14,525
|
|
|
$
|
17,618
|
|
Finished goods
|
16,985
|
|
|
24,120
|
|
||
|
$
|
31,510
|
|
|
$
|
41,738
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
Useful Life
(in Years)
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
|
|
|
(in thousands)
|
||||||
Furniture and fixtures
|
5
|
|
$
|
2,199
|
|
|
$
|
2,020
|
|
Machinery and equipment
|
3-5
|
|
35,660
|
|
|
34,225
|
|
||
Masks and production equipment
|
2-5
|
|
15,209
|
|
|
12,645
|
|
||
Software
|
3
|
|
5,956
|
|
|
5,675
|
|
||
Leasehold improvements
|
1-5
|
|
16,186
|
|
|
17,493
|
|
||
Construction in progress
|
N/A
|
|
746
|
|
|
133
|
|
||
|
|
|
75,956
|
|
|
72,191
|
|
||
Less accumulated depreciation and amortization
|
|
|
(59,343
|
)
|
|
(53,787
|
)
|
||
|
|
|
$
|
16,613
|
|
|
$
|
18,404
|
|
|
Years Ended December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in thousands)
|
||||||
Beginning balance
|
$
|
16,454
|
|
|
$
|
21,571
|
|
Charged as a reduction of revenue
|
24,449
|
|
|
34,288
|
|
||
Reversal of unclaimed rebates
|
(42
|
)
|
|
(2,413
|
)
|
||
Payments
|
(28,304
|
)
|
|
(36,992
|
)
|
||
Ending balance
|
$
|
12,557
|
|
|
$
|
16,454
|
|
|
December 31, 2019
|
|
December 31, 2018(1)
|
||||
|
(in thousands)
|
||||||
Accrued technology license payments
|
$
|
4,500
|
|
|
$
|
4,500
|
|
Accrued professional fees
|
861
|
|
|
1,270
|
|
||
Accrued engineering and production costs
|
4,491
|
|
|
646
|
|
||
Accrued restructuring
|
294
|
|
|
1,946
|
|
||
Accrued royalty
|
923
|
|
|
980
|
|
||
Short-term lease liabilities
|
4,810
|
|
|
1,214
|
|
||
Accrued customer credits
|
832
|
|
|
1,204
|
|
||
Income tax liability
|
65
|
|
|
784
|
|
||
Customer contract liabilities
|
107
|
|
|
71
|
|
||
Accrued obligations to customers for price adjustments
|
8,382
|
|
|
7,558
|
|
||
Accrued obligations to customers for stock rotation rights
|
1,410
|
|
|
1,494
|
|
||
Other
|
4,496
|
|
|
6,615
|
|
||
|
$
|
31,171
|
|
|
$
|
28,282
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
|
Cumulative Translation Adjustments
|
|
Interest Rate Hedge
|
|
Total
|
||||||
|
(in thousands)
|
|||||||||||
Balance at December 31, 2017
|
|
$
|
562
|
|
|
$
|
477
|
|
|
$
|
1,039
|
|
Other comprehensive income (loss) before reclassifications, net of tax
|
|
(1,572
|
)
|
|
702
|
|
|
(870
|
)
|
|||
Net current period other comprehensive income (loss)
|
|
(1,572
|
)
|
|
702
|
|
|
(870
|
)
|
|||
Cumulative effect of adoption of new accounting principles
|
|
103
|
|
|
—
|
|
|
103
|
|
|||
Balance at December 31, 2018
|
|
(907
|
)
|
|
1,179
|
|
|
272
|
|
|||
Other comprehensive income (loss) before reclassifications, net of tax
|
|
160
|
|
|
(1,319
|
)
|
|
(1,159
|
)
|
|||
Net current period other comprehensive income (loss)
|
|
160
|
|
|
(1,319
|
)
|
|
(1,159
|
)
|
|||
Balance at December 31, 2019
|
|
$
|
(747
|
)
|
|
$
|
(140
|
)
|
|
$
|
(887
|
)
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
|
(in thousands)
|
||||||
|
|
|
|
||||
Principal
|
$
|
212,000
|
|
|
$
|
262,000
|
|
Less:
|
|
|
|
||||
Unamortized debt discount
|
(1,328
|
)
|
|
(1,630
|
)
|
||
Unamortized debt issuance costs
|
(3,763
|
)
|
|
(4,613
|
)
|
||
Net carrying amount of long-term debt
|
206,909
|
|
|
255,757
|
|
||
Less: current portion of long-term debt
|
—
|
|
|
—
|
|
||
Long-term debt, non-current portion
|
$
|
206,909
|
|
|
$
|
255,757
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in thousands)
|
||||||||||
Cost of net revenue
|
$
|
577
|
|
|
$
|
489
|
|
|
$
|
332
|
|
Research and development
|
16,545
|
|
|
17,953
|
|
|
16,190
|
|
|||
Selling, general and administrative
|
14,938
|
|
|
13,279
|
|
|
11,016
|
|
|||
Restructuring expense
|
—
|
|
|
—
|
|
|
5,130
|
|
|||
|
$
|
32,060
|
|
|
$
|
31,721
|
|
|
$
|
32,668
|
|
|
Number of Shares
(in thousands)
|
|
Weighted-Average Grant-Date Fair Value per Share
|
|||
Outstanding at December 31, 2018
|
3,263
|
|
|
$
|
20.23
|
|
Granted
|
1,580
|
|
|
23.23
|
|
|
Vested
|
(1,541
|
)
|
|
20.16
|
|
|
Canceled
|
(378
|
)
|
|
21.52
|
|
|
Outstanding at December 31, 2019
|
2,924
|
|
|
21.72
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
Number of Shares
(in thousands)
|
|
Weighted-Average Grant-Date Fair Value per Share
|
|||
Outstanding at December 31, 2018
|
—
|
|
|
$
|
—
|
|
Granted(1)
|
445
|
|
|
22.21
|
|
|
Outstanding at December 31, 2019
|
445
|
|
|
22.21
|
|
|
Years Ended December 31,
|
|||||||
|
2019
|
|
2018
|
|
2017
|
|||
Weighted-average grant date fair value per share
|
$5.48 - 6.61
|
|
|
$5.01 - $5.37
|
|
|
$6.20 - $7.46
|
|
Risk-free interest rate
|
1.59 - 2.43%
|
|
|
2.09 - 2.51%
|
|
|
0.60 - 1.39%
|
|
Dividend yield
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
Expected term (in years)
|
0.5
|
|
|
0.5
|
|
|
0.38 - 0.50
|
|
Volatility
|
40.47 - 43.14%
|
|
|
38.82 - 46.17%
|
|
|
29.56 - 49.94%
|
|
|
Number of Options
(in thousands)
|
|
Weighted-Average Exercise Price
|
|
Weighted-Average Contractual Term
(in years)
|
|
Aggregate Intrinsic Value
(in thousands)
|
|||||
Outstanding at December 31, 2018
|
2,659
|
|
|
$
|
10.27
|
|
|
|
|
|
||
Exercised
|
(1,300
|
)
|
|
7.28
|
|
|
|
|
|
|||
Canceled
|
(22
|
)
|
|
18.09
|
|
|
|
|
|
|||
Outstanding at December 31, 2019
|
1,337
|
|
|
$
|
13.05
|
|
|
2.56
|
|
$
|
11,259
|
|
Vested and expected to vest at December 31, 2019
|
1,329
|
|
|
$
|
13.02
|
|
|
2.55
|
|
$
|
11,239
|
|
Exercisable at December 31, 2019
|
1,094
|
|
|
$
|
11.87
|
|
|
1.93
|
|
$
|
10,549
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
Years Ended December 31,
|
|||||
|
2018
|
|
2017(1)
|
|||
Weighted-average grant date fair value per share
|
$
|
8.14
|
|
|
8.77 - 21.04
|
|
Risk-free interest rate
|
2.76
|
%
|
|
1.29% - 1.99%
|
|
|
Dividend yield
|
—
|
%
|
|
—
|
%
|
|
Expected term (in years)
|
5.50
|
|
|
1.6 - 6.0
|
|
|
Volatility
|
44.30
|
%
|
|
45.39% - 50.32%
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in thousands)
|
||||||||||
Domestic
|
$
|
(61,893
|
)
|
|
$
|
16,405
|
|
|
$
|
42,580
|
|
Foreign
|
29,409
|
|
|
(49,257
|
)
|
|
(76,578
|
)
|
|||
Loss before income taxes
|
$
|
(32,484
|
)
|
|
$
|
(32,852
|
)
|
|
$
|
(33,998
|
)
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in thousands)
|
||||||||||
Current:
|
|
|
|
|
|
||||||
Federal
|
$
|
1,604
|
|
|
$
|
3,292
|
|
|
$
|
13,470
|
|
State
|
16
|
|
|
37
|
|
|
26
|
|
|||
Foreign
|
1,560
|
|
|
1,640
|
|
|
1,784
|
|
|||
Total current
|
3,180
|
|
|
4,969
|
|
|
15,280
|
|
|||
Deferred:
|
|
|
|
|
|
||||||
Federal
|
(13,793
|
)
|
|
788
|
|
|
19,451
|
|
|||
State
|
(1,829
|
)
|
|
(2,799
|
)
|
|
(4,668
|
)
|
|||
Foreign
|
1,095
|
|
|
(3,884
|
)
|
|
(3,697
|
)
|
|||
Change in valuation allowance
|
(1,239
|
)
|
|
(5,727
|
)
|
|
(51,177
|
)
|
|||
Total deferred
|
(15,766
|
)
|
|
(11,622
|
)
|
|
(40,091
|
)
|
|||
Total income tax benefit
|
$
|
(12,586
|
)
|
|
$
|
(6,653
|
)
|
|
$
|
(24,811
|
)
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
|
(in thousands)
|
||||||||||
Provision (benefit) at statutory rate
|
$
|
(6,821
|
)
|
|
$
|
(6,814
|
)
|
|
$
|
(11,899
|
)
|
State income taxes (net of federal benefit)
|
11
|
|
|
20
|
|
|
17
|
|
|||
Research and development credits
|
(7,815
|
)
|
|
(8,849
|
)
|
|
(8,153
|
)
|
|||
Foreign rate differential
|
(4,489
|
)
|
|
8,640
|
|
|
23,666
|
|
|||
Stock compensation
|
(2,750
|
)
|
|
74
|
|
|
(5,713
|
)
|
|||
Foreign income inclusion
|
3,936
|
|
|
1,103
|
|
|
—
|
|
|||
Transaction costs
|
—
|
|
|
—
|
|
|
553
|
|
|||
Provision to return
|
1,887
|
|
|
(27
|
)
|
|
(917
|
)
|
|||
Uncertain tax positions
|
1,244
|
|
|
1,463
|
|
|
1,993
|
|
|||
Foreign tax credits
|
—
|
|
|
—
|
|
|
(5
|
)
|
|||
Permanent and other
|
716
|
|
|
1,319
|
|
|
1,730
|
|
|||
Foreign unremitted earnings
|
(103
|
)
|
|
1,960
|
|
|
(1,368
|
)
|
|||
Tax Act
|
—
|
|
|
185
|
|
|
25,205
|
|
|||
Other tax rate changes
|
—
|
|
|
—
|
|
|
1,257
|
|
|||
Attribute expirations
|
2,837
|
|
|
—
|
|
|
—
|
|
|||
Valuation allowance
|
(1,239
|
)
|
|
(5,727
|
)
|
|
(51,177
|
)
|
|||
Total income tax benefit
|
$
|
(12,586
|
)
|
|
$
|
(6,653
|
)
|
|
$
|
(24,811
|
)
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in thousands)
|
||||||
Deferred tax assets:
|
|
|
|
||||
Net operating loss carryforwards
|
$
|
65,477
|
|
|
$
|
64,887
|
|
Research and development credits
|
80,404
|
|
|
75,032
|
|
||
Accrued expenses and other
|
7,768
|
|
|
7,965
|
|
||
Lease obligation
|
2,047
|
|
|
—
|
|
||
Accrued compensation
|
1,441
|
|
|
2,504
|
|
||
Stock-based compensation
|
3,460
|
|
|
2,550
|
|
||
|
160,597
|
|
|
152,938
|
|
||
Less valuation allowance
|
(77,957
|
)
|
|
(79,196
|
)
|
||
|
82,640
|
|
|
73,742
|
|
||
Deferred tax liabilities:
|
|
|
|
||||
Fixed assets
|
(246
|
)
|
|
(1,391
|
)
|
||
Leased right-of-use assets
|
(1,483
|
)
|
|
—
|
|
||
Intangible assets
|
(13,627
|
)
|
|
(20,833
|
)
|
||
Net deferred tax assets
|
$
|
67,284
|
|
|
$
|
51,518
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
Operating Leases
|
||
|
(in thousands)
|
||
2020
|
$
|
5,406
|
|
2021
|
5,217
|
|
|
2022
|
3,591
|
|
|
2023
|
1,030
|
|
|
Total minimum payments
|
15,244
|
|
|
Less: imputed interest
|
(1,096
|
)
|
|
Less: unrealized translation loss
|
(3
|
)
|
|
Total lease liabilities
|
14,145
|
|
|
Less: short-term lease liabilities
|
(4,810
|
)
|
|
Lease liabilities - long-term
|
$
|
9,335
|
|
|
|
Amount
|
||
|
|
(in thousands)
|
||
2020
|
|
$
|
644
|
|
2021
|
|
546
|
|
|
2022
|
|
488
|
|
|
2023
|
|
291
|
|
|
|
|
$
|
1,969
|
|
|
Inventory Purchase Obligations
|
|
Other Obligations
|
|
Total
|
||||||
|
(in thousands)
|
||||||||||
2020
|
$
|
15,093
|
|
|
$
|
5,735
|
|
|
$
|
20,828
|
|
2021
|
—
|
|
|
893
|
|
|
893
|
|
|||
2022
|
—
|
|
|
425
|
|
|
425
|
|
|||
2023
|
—
|
|
|
447
|
|
|
447
|
|
|||
Total minimum payments
|
$
|
15,093
|
|
|
$
|
7,500
|
|
|
$
|
22,593
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
Years Ended December 31,
|
|||||||
|
2019
|
|
2018
|
|
2017
|
|||
Percentage of total net revenue
|
|
|
|
|
|
|||
Customer A (direct)
|
14
|
%
|
|
18
|
%
|
|
25
|
%
|
|
December 31,
|
||||
|
2019
|
|
2018
|
||
Percentage of gross accounts receivable
|
|
|
|
||
Customer B
|
10
|
%
|
|
10
|
%
|
|
Years ended December 31,
|
|||||||
|
2019
|
|
2018
|
|
2017
|
|||
Vendor A
|
17
|
%
|
|
16
|
%
|
|
21
|
%
|
Vendor B
|
15
|
%
|
|
13
|
%
|
|
11
|
%
|
Vendor C
|
14
|
%
|
|
19
|
%
|
|
16
|
%
|
Vendor D
|
13
|
%
|
|
15
|
%
|
|
15
|
%
|
Vendor E
|
*
|
|
|
*
|
|
|
14
|
%
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
Years Ended December 31,
|
|||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|||||||||||||||
|
Amount
|
|
% of total net revenue
|
|
Amount
|
|
% of total net revenue
|
|
Amount
|
|
% of total net revenue
|
|||||||||
Asia
|
$
|
265,122
|
|
|
84
|
%
|
|
$
|
312,877
|
|
|
81
|
%
|
|
$
|
372,103
|
|
|
89
|
%
|
United States
|
13,984
|
|
|
4
|
%
|
|
18,060
|
|
|
5
|
%
|
|
10,829
|
|
|
2
|
%
|
|||
Rest of world
|
38,074
|
|
|
12
|
%
|
|
54,060
|
|
|
14
|
%
|
|
37,386
|
|
|
9
|
%
|
|||
Total
|
$
|
317,180
|
|
|
100
|
%
|
|
$
|
384,997
|
|
|
100
|
%
|
|
$
|
420,318
|
|
|
100
|
%
|
|
Years Ended December 31,
|
|||||||
|
2019
|
|
2018
|
|
2017
|
|||
Percentage of total net revenue
|
|
|
|
|
|
|||
China
|
60
|
%
|
|
63
|
%
|
|
71
|
%
|
|
As of December 31,
|
||||||||||||
|
2019
|
|
2018(1)
|
||||||||||
|
Amount
|
|
% of total
|
|
Amount
|
|
% of total
|
||||||
United States
|
$
|
385,302
|
|
|
85
|
%
|
|
$
|
426,321
|
|
|
85
|
%
|
Singapore
|
63,556
|
|
|
14
|
%
|
|
71,945
|
|
|
14
|
%
|
||
Rest of world
|
5,034
|
|
|
1
|
%
|
|
3,368
|
|
|
1
|
%
|
||
Total
|
$
|
453,892
|
|
|
100
|
%
|
|
$
|
501,634
|
|
|
100
|
%
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
Year Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017(1)
|
||||||
|
|
|
|||||||||
Connected home
|
$
|
152,674
|
|
|
$
|
207,336
|
|
|
$
|
288,610
|
|
% of net revenue
|
48
|
%
|
|
54
|
%
|
|
69
|
%
|
|||
Infrastructure
|
85,369
|
|
|
82,388
|
|
|
71,779
|
|
|||
% of net revenue
|
27
|
%
|
|
21
|
%
|
|
17
|
%
|
|||
Industrial and multi-market
|
79,137
|
|
|
95,273
|
|
|
59,929
|
|
|||
% of net revenue
|
25
|
%
|
|
25
|
%
|
|
14
|
%
|
|||
Total net revenue
|
$
|
317,180
|
|
|
$
|
384,997
|
|
|
$
|
420,318
|
|
|
MAXLINEAR, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except per share amounts and percentage data)
|
|
|
Year Ended December 31, 2019
|
||||||||||||||
|
First Quarter
|
|
Second Quarter
|
|
Third Quarter
|
|
Fourth Quarter
|
||||||||
|
(in thousands, except per share amounts)
|
||||||||||||||
Net revenue
|
$
|
84,635
|
|
|
$
|
82,507
|
|
|
$
|
80,020
|
|
|
$
|
70,018
|
|
Gross profit
|
$
|
45,077
|
|
|
$
|
44,080
|
|
|
$
|
41,904
|
|
|
$
|
36,624
|
|
Net loss
|
$
|
(4,851
|
)
|
|
$
|
(2,229
|
)
|
|
$
|
(4,714
|
)
|
|
$
|
(8,104
|
)
|
Net loss per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(0.07
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
(0.07
|
)
|
|
$
|
(0.11
|
)
|
Diluted
|
$
|
(0.07
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
(0.07
|
)
|
|
$
|
(0.11
|
)
|
|
Year Ended December 31, 2018
|
||||||||||||||
|
First Quarter
|
|
Second Quarter
|
|
Third Quarter
|
|
Fourth Quarter
|
||||||||
|
(in thousands, except per share amounts)
|
||||||||||||||
Net revenue
|
$
|
110,827
|
|
|
$
|
101,533
|
|
|
$
|
85,010
|
|
|
$
|
87,627
|
|
Gross profit
|
$
|
62,668
|
|
|
$
|
56,330
|
|
|
$
|
43,876
|
|
|
$
|
45,900
|
|
Net income (loss)
|
$
|
1,847
|
|
|
$
|
(14,422
|
)
|
|
$
|
(13,935
|
)
|
|
$
|
311
|
|
Net income (loss) per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.03
|
|
|
$
|
(0.21
|
)
|
|
$
|
(0.20
|
)
|
|
$
|
0.00
|
|
Diluted
|
$
|
0.03
|
|
|
$
|
(0.21
|
)
|
|
$
|
(0.20
|
)
|
|
$
|
0.00
|
|
•
|
reducing the likelihood that holders of Common Stock will receive payments in the event of our liquidation, dissolution, or winding up; and
|
•
|
authorize our board of directors to issue, without further action by the stockholders, up to 25,000,000 shares of undesignated preferred stock;
|
•
|
require that any action to be taken by our stockholders be effected at a duly called annual or special meeting and not by written consent;
|
•
|
specify that special meetings of our stockholders can be called only by our board of directors, our chairman of the board of directors, or the President of the Company;
|
•
|
establish an advance notice procedure for stockholder approvals to be brought before an annual meeting of our stockholders, including proposed nominations of persons for election to our board of directors;
|
•
|
establish that our board of directors is divided into three classes, Class I, Class II and Class III, with each class serving staggered terms;
|
•
|
provide that our directors may be removed only for cause;
|
•
|
provide that vacancies on our board of directors may be filled only by a majority of directors then in office, even though less than a quorum;
|
•
|
specify that no stockholder is permitted to cumulate votes at any election of directors; and
|
•
|
require supermajority votes of the holders of our Common Stock to amend special provisions of our charter documents.
|
•
|
prior to the date of the transaction, the board of directors of the corporation approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder;
|
•
|
upon completion of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the voting stock outstanding, but not for determining the outstanding voting stock owned by the interested stockholder, (1) shares owned by persons who are directors and also officers and (2) shares owned by employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or
|
•
|
at or subsequent to the date of the transaction, the business combination is approved by the board of directors of the corporation and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 66 2/3% of the outstanding voting stock which is not owned by the interested stockholder.
|
1.
|
I have reviewed this Form 10-K of MaxLinear, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date:
|
February 5, 2020
|
|
/s/ Kishore Seendripu, Ph.D.
|
|
|
|
Kishore Seendripu, Ph.D.
|
|
|
|
President and Chief Executive Officer
|
|
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this Form 10-K of MaxLinear, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date:
|
February 5, 2020
|
|
/s/ Steven G. Litchfield
|
|
|
|
Steven G. Litchfield
|
|
|
|
Chief Financial Officer and Chief Corporate Strategy Officer
|
|
|
|
(Principal Financial Officer)
|
Date:
|
February 5, 2020
|
|
By:
|
/s/ Kishore Seendripu, Ph.D.
|
|
|
|
Name:
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Kishore Seendripu, Ph.D.
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Title:
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President and Chief Executive Officer
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Date:
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February 5, 2020
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By:
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/s/ Steven G. Litchfield
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Name:
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Steven G. Litchfield
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Title:
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Chief Financial Officer and Chief Corporate Strategy Officer
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