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Skyworks Exceeds Q1 FY12 Revenue And EPS Guidance

Stocks in this article: SWKS

These forward-looking statements are made only as of the date hereof, and we undertake no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.

Note to Editors: Skyworks and Skyworks Solutions are trademarks or registered trademarks of Skyworks Solutions, Inc. or its subsidiaries in the United States and in other countries. All other brands and names listed are trademarks of their respective companies.

 
SKYWORKS SOLUTIONS, INC.
UNAUDITED CONSOLIDATED STATEMENT OF OPERATIONS
 
   
Quarter Ended
 
Dec. 30, Dec. 31,
(in thousands) 2011 2010
 
Net revenue $ 393,740 $ 335,120
Cost of goods sold   221,890     186,582  
Gross profit 171,850 148,538
 
Operating expenses:
Research and development 46,941 38,543
Selling, general and administrative 42,909 31,051
Amortization of intangibles 6,312 1,602
Restructuring and other charges   720     -  
Total operating expenses 96,882 71,196
 
Operating income 74,968 77,342
 
Interest expense (481 ) (537 )
Gain on early retirement of convertible debt 76 -
Other income (loss), net   99     (69 )
Income before income taxes 74,662 76,736
Provision for income taxes   17,536     15,868  
Net income $ 57,126   $ 60,868  
 
Earnings per share:
Basic $ 0.31 $ 0.34
Diluted $ 0.30 $ 0.32
Weighted average shares:
Basic 183,956 180,706
Diluted 189,682 188,541
 
 
SKYWORKS SOLUTIONS, INC.
UNAUDITED RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
   
Quarter Ended
 
Dec. 30, Dec. 31,
(in thousands) 2011 2010
 
GAAP gross profit $ 171,850 $ 148,538
Share-based compensation expense [a] 2,517 1,345
Acquisition-related expense [b]   76     -  
Non-GAAP gross profit $ 174,443   $ 149,883  
 
Non-GAAP gross margin % 44.3 % 44.7 %
 
Quarter Ended
 
Dec. 30, Dec. 31,
(in thousands) 2011 2010
 
GAAP operating income $ 74,968 $ 77,342
Share-based compensation expense [a] 15,750 13,281
Acquisition-related expense [b] 7,283 445
Amortization of intangibles 6,312 1,602
Restructuring and other charges [c] 720 -
Deferred executive compensation   143     165  
Non-GAAP operating income $ 105,176   $ 92,835  
 
Non-GAAP operating margin % 26.7 % 27.7 %
 
Quarter Ended
 
Dec. 30, Dec. 31,
(in thousands) 2011 2010
 
GAAP net income $ 57,126 $ 60,868
Share-based compensation expense [a] 15,750 13,281
Acquisition-related expense [b] 7,283 445
Amortization of intangibles 6,312 1,602
Restructuring and other charges [c] 720 -
Deferred executive compensation 143 165
Gain on early retirement of convertible debt [d] (76 ) -

Amortization of discount on convertible debt [e]

351

328
Tax adjustments [f]   8,632     7,998  
Non-GAAP net income $ 96,241   $ 84,687  
 
Quarter Ended
 
Dec. 30, Dec. 31,
2011 2010
 
GAAP net income per share, diluted $ 0.30 $ 0.32
Share-based compensation expense [a] 0.08 0.07
Acquisition-related expense [b] 0.04 -
Amortization of intangibles 0.03 0.01
Restructuring and other charges [c] 0.01 -
Tax adjustments [f]   0.05     0.05  
Non-GAAP net income per share, diluted $ 0.51   $ 0.45  
 

SKYWORKS SOLUTIONS, INC.

DISCUSSION REGARDING THE USE OF NON-GAAP FINANCIAL MEASURES

Our earnings release contains some or all of the following financial measures which have not been calculated in accordance with United States Generally Accepted Accounting Principles (GAAP): (i) non-GAAP gross profit and gross margin, (ii) non-GAAP operating income and operating margin, (iii) non-GAAP net income, and (iv) non-GAAP net income per share (diluted). As set forth in the “Unaudited Reconciliation of Non-GAAP Financial Measures” table found above, we derive such non-GAAP financial measures by excluding certain  expenses and other items from the respective GAAP financial measure that is most directly comparable to each non-GAAP financial measure. Management uses these non-GAAP financial measures to evaluate our operating performance and compare it against past periods, make operating decisions, forecast for future periods, compare operating performance against peer companies and determine payments under certain compensation programs. These non-GAAP financial measures provide management with additional means to understand and evaluate the operating results and trends in our ongoing  business by eliminating certain non-recurring expenses (which may not occur in each period presented) and other items that management believes might otherwise make comparisons of our ongoing business with prior periods and competitors more difficult, obscure trends in ongoing operations or reduce management’s ability to make useful forecasts.

We provide investors with non-GAAP gross profit and gross margin, non-GAAP operating income and operating margin and non-GAAP net income because we believe it is important for investors to be able to closely monitor and understand changes in our ability to generate income from ongoing business operations. We believe these non-GAAP financial measures give investors an additional method to evaluate historical operating performance and identify trends, additional means of evaluating period-over-period operating performance and a method to facilitate certain comparisons of operating results to peer companies. We also believe that providing non-GAAP operating income and operating margin allows investors to assess the extent to which ongoing operations impact our overall financial performance. We further believe that providing non-GAAP net income and non-GAAP net income per share (diluted) allows investors to assess the overall financial performance of ongoing operations by eliminating the impact of certain financing decisions related to our convertible debt and certain tax items which may not occur in each period for which financial information is presented and which represent gains or losses unrelated to our ongoing operations. We believe that disclosing these non-GAAP financial measures contributes to enhanced financial reporting transparency and provides investors with added clarity about complex financial performance measures.

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