Amortization of Discount on Convertible Debt - comprised of the amortization of the debt discount recorded at inception of the convertible debt borrowing related to the adoption of ASC 470-20, because the expense is dependent on fair value assessments and is not considered by management when making operating decisions.
Gains and Losses on Retirement of Convertible Debt - because, to the extent that gains or losses from such repurchases impact a period presented, we do not believe that they reflect the underlying performance of ongoing business operations for such period.
Certain Income Tax Items - including certain deferred tax charges and benefits which do not result in a current tax payment or tax refund and other adjustments which are not indicative of ongoing business operations.
The non-GAAP financial measures presented in the table above should not be considered in isolation and are not an alternative for, the respective GAAP financial measure that is most directly comparable to each such non-GAAP financial measure. Investors are cautioned against placing undue reliance on these non-GAAP financial measures and are urged to review and consider carefully the adjustments made by management to the most directly comparable GAAP financial measures to arrive at these non-GAAP financial measures. Non-GAAP financial measures may have limited value as analytical tools because they may exclude certain expenses that some investors consider important in evaluating operating performance or ongoing business. Further, non-GAAP financial measures are likely to have limited value for purposes of drawing comparisons between companies because different companies may calculate similarly titled non-GAAP financial measures in different ways because non-GAAP measures are not based on any comprehensive set of accounting rules or principles.Our earnings release contains a forward looking estimate of non-GAAP diluted earnings per share for the fourth quarter of our 2012 fiscal year (“Q4 2012”). We provide this non-GAAP measure to investors on a prospective basis for the same reasons (set forth above) that we provide them to investors on a historical basis. We are unable to provide a reconciliation of our forward looking estimate of Q4 2012 non-GAAP diluted earnings per share to a forward looking estimate of Q4 2012 GAAP diluted earnings per share because certain information needed to make a reasonable forward looking estimate of GAAP diluted earnings per share for Q4 2012 (other than estimated stock compensation expense of $0.10 per diluted share, certain tax items of $0.07 per diluted share, estimated acquisition related expense of $0.05 per diluted share and estimated deferred executive compensation expense and restructuring and other charges with a de minimis impact per diluted share) is difficult to predict and estimate and is often dependent on future events which may be uncertain or outside of our control. Such events may include unanticipated one time charges related to asset impairments (fixed assets, intangibles or goodwill), unanticipated acquisition related costs, unanticipated litigation settlement gains and losses and other unanticipated non-recurring items not reflective of ongoing operations. We believe the probable significance of these unknown items, in aggregate, to be in the range of $0.00 to $0.10 in quarterly earnings per diluted share on a GAAP basis. Our forward looking estimates of both GAAP and non-GAAP measures of our financial performance may differ materially from our actual results and should not be relied upon as statements of fact.
|[a]||These charges represent expense recognized in accordance with ASC 718 - Compensation, Stock Compensation. Approximately $2.1 million, $7.5 million and $9.0 million were included in cost of goods sold, research and development expense and selling, general and administrative expense, respectively, for the three months ended June 29, 2012. Approximately $7.0 million, $20.6 million and $26.0 million were included in cost of goods sold, research and development expense and selling, general and administrative expense, respectively, for the nine months ended June 29, 2012.|
|For the three months ended July 1, 2011, approximately $2.2 million, $4.2 million and $8.1 million were included in costs of goods sold, research and development expense and selling, general and administrative expense, respectively. For the nine months ended July 1, 2011 approximately $5.4 million, $13.1 million and $24.2 million were included in costs of goods sold, research and development expense and selling, general and administrative expense, respectively.|
|[b]||The acquisition-related expense recognized during the three months and nine months ended June 29, 2012 includes a $0.7 million and $3.6 million charge to cost of sales related to the sale of acquired inventory and $0.7 million and $9.9 million in transaction costs included in general and administrative expenses associated with acquisitions, and an arbitration, completed or contemplated during the three months and nine months ended June 29, 2012, respectively. Also included in general and administrative expenses for the three months and nine months ended June 29, 2012 is a $5.4 million credit due to a reduction in the estimated fair value of contingent consideration liabilities associated with acquisitions.|
|The acquisition-related expense recognized during the three months and nine months ended July 1, 2011 includes a $1.6 million charge to cost of sales related to the sale of acquired inventory. Also included in acquisition-related expense is $1.2 million and $1.9 million in transaction costs associated with acquisitions completed or contemplated during the three months and nine months ended July 1, 2011, respectively.|
|[c]||During the nine months ended June 29, 2012, the Company implemented a restructuring plan to reduce the headcount associated with its acquisition of Advanced Analogic Technologies, Inc. For the three months and nine months ended June 29, 2012, the Company recorded $1.1 million and $7.8 million, respectively, primarily related to this restructuring plan.|
|During the three months ended July 1, 2011, the Company implemented a restructuring plan to reduce the headcount associated with its acquisition of SiGe Semiconductor, Inc.|
|[d]||During the three months and nine months ended June 29, 2012, the Company recognized a $5.3 million and $5.8 million charge, respectively, related to the resolution of contractual disputes.|
|During the three months and nine months ended July 1, 2011, the Company recognized a $2.3 million charge related to the resolution of a contractual dispute.|
|[e]||The gain recorded during the nine months ended June 29, 2012 relates to the retirement of the Company's 1.50% convertible subordinated notes due on March 1, 2012.|
|[f]||These charges represent the amortization expense recognized in accordance with ASC 470-20. Approximately $0.4 million of amortization expense was recognized during the nine months ended June 29, 2012.|
|Approximately $0.3 and $1.0 million, respectively, of amortization expense was recognized during the three months and nine months ended July 1, 2011.|
|[g]||For the three months and nine months ended June 29, 2012, these amounts primarily represent the utilization of net operating loss and research and development tax credit carryforwards and non-cash expense related to uncertain tax positions.|
|During the three months and nine months ended July 1, 2011, these amounts primarily represent the utilization of net operating loss and research and development credit carryforwards.|
|SKYWORKS SOLUTIONS, INC.|
|UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET|
|June 29,||Sept. 30,|
|Cash and cash equivalents||$||327,915||$||410,799|
|Accounts receivable, net||246,894||177,940|
|Prepaid expenses and other current assets||44,734||29,412|
|Property, plant and equipment, net||266,039||251,365|
|Goodwill and intangible assets, net||907,907||749,849|
|Liabilities and Equity|
|Accrued liabilities and other current liabilities||103,974||105,717|
|Other long-term liabilities||48,657||34,198|
|Total liabilities and equity||$||2,089,893||$||1,890,389|
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