e10vq
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
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þ |
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended April 1, 2011
OR
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o |
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission file number 1-5560
SKYWORKS SOLUTIONS, INC.
(Exact Name of
Registrant as Specified in its Charter)
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Delaware
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04-2302115 |
(State or Other Jurisdiction of
Incorporation or Organization)
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(I.R.S. Employer
Identification No.) |
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20 Sylvan Road, Woburn, Massachusetts
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01801 |
(Address of Principal Executive Offices)
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(Zip Code) |
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Registrants Telephone Number, Including Area Code:
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(781) 376-3000 |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for
such shorter period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. þ Yes o No
Indicate by check mark whether the registrant has submitted electronically and posted on its
corporate Web site, if any, every Interactive Data File required to be submitted and posted
pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months
(or for such shorter period that the registrant was required to submit and post such files).
þ Yes o No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a
non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated
filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.
(Check one):
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Large accelerated filer þ
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Accelerated filer o
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Non-accelerated filer o
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Smaller reporting company o |
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(Do not check if a smaller reporting company) |
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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the
Exchange Act). o Yes þ No
Indicate the number of shares outstanding of each of the issuers classes of common stock, as of
the latest practicable date.
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Class
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Outstanding at April 29, 2011 |
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Common Stock, par value $.25 per share
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186,187,121 |
SKYWORKS SOLUTIONS, INC.
QUARTERLY REPORT ON FORM 10-Q
FOR THE QUARTER ENDED APRIL 1, 2011
TABLE OF CONTENTS
2
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
SKYWORKS SOLUTIONS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, in thousands, except per share amounts)
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Three-months Ended |
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Six-months Ended |
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April 1, |
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April 2, |
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April 1, |
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April 2, |
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2011 |
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2010 |
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2011 |
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2010 |
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Net revenue |
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$ |
325,411 |
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$ |
238,058 |
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$ |
660,531 |
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$ |
483,196 |
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Cost of goods sold |
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184,430 |
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138,204 |
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371,012 |
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280,788 |
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Gross profit |
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140,981 |
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99,854 |
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289,519 |
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202,408 |
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Operating expenses: |
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Research and development |
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39,618 |
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32,060 |
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78,161 |
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63,849 |
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Selling, general and administrative |
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31,665 |
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27,982 |
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62,716 |
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54,713 |
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Amortization of intangibles |
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1,638 |
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1,500 |
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3,240 |
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3,001 |
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Total operating expenses |
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72,921 |
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61,542 |
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144,117 |
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121,563 |
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Operating income |
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68,060 |
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38,312 |
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145,402 |
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80,845 |
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Interest expense |
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(461 |
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(1,183 |
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(998 |
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(2,752 |
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Loss on early retirement of
convertible debt |
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(73 |
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(124 |
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Other loss, net |
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(114 |
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(208 |
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(183 |
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(319 |
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Income before income taxes |
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67,485 |
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36,848 |
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144,221 |
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77,650 |
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Provision for income taxes |
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17,525 |
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9,104 |
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33,393 |
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21,896 |
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Net income |
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$ |
49,960 |
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$ |
27,744 |
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$ |
110,828 |
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$ |
55,754 |
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Earnings per share: |
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Basic |
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$ |
0.27 |
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$ |
0.16 |
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$ |
0.61 |
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$ |
0.32 |
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Diluted |
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$ |
0.26 |
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$ |
0.15 |
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$ |
0.58 |
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$ |
0.31 |
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Weighted average shares: |
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Basic |
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183,471 |
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174,449 |
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182,088 |
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173,583 |
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Diluted |
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191,961 |
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182,924 |
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190,251 |
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181,164 |
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The accompanying notes are an integral part of these consolidated financial statements.
3
SKYWORKS SOLUTIONS, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited, in thousands, except per share amounts)
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As of |
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April 1, |
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October 1, |
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2011 |
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2010 |
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ASSETS |
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Current assets: |
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Cash and cash equivalents |
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$ |
503,801 |
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$ |
453,257 |
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Restricted cash |
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662 |
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6,128 |
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Receivables, net of allowance for doubtful accounts of $1,165 and
$1,177, respectively |
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183,352 |
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175,232 |
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Inventories |
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151,179 |
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125,059 |
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Other current assets |
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33,450 |
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30,189 |
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Total current assets |
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872,444 |
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789,865 |
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Property, plant and equipment, net |
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241,733 |
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204,363 |
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Goodwill |
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485,543 |
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485,587 |
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Intangible assets, net |
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13,519 |
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12,509 |
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Deferred tax assets, net |
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55,330 |
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60,569 |
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Other assets |
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10,228 |
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11,159 |
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Total assets |
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$ |
1,678,797 |
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$ |
1,564,052 |
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LIABILITIES AND STOCKHOLDERS EQUITY |
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Current liabilities: |
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Short-term debt |
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$ |
25,405 |
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$ |
50,000 |
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Accounts payable |
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111,949 |
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111,967 |
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Accrued compensation and benefits |
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32,892 |
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35,695 |
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Other current liabilities |
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6,198 |
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6,662 |
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Total current liabilities |
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176,444 |
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204,324 |
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Long-term debt, less current maturities |
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24,743 |
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Other long-term liabilities |
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25,961 |
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18,389 |
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Total liabilities |
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202,405 |
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247,456 |
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Commitments and contingencies (Note 9) |
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Stockholders equity: |
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Preferred stock, no par value: 25,000 shares authorized, no shares issued |
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Common stock, $0.25 par value: 525,000 shares authorized; 193,668 shares
issued and 185,944 shares outstanding at April 1, 2011 and 185,683
shares issued and 180,263 shares outstanding at October 1, 2010 |
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46,486 |
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45,066 |
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Additional paid-in capital |
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1,749,299 |
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1,641,406 |
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Treasury stock, at cost |
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(101,064 |
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(40,719 |
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Accumulated deficit |
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(217,032 |
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(327,860 |
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Accumulated other comprehensive loss |
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(1,297 |
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(1,297 |
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Total stockholders equity |
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1,476,392 |
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1,316,596 |
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Total liabilities and stockholders equity |
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$ |
1,678,797 |
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$ |
1,564,052 |
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The accompanying notes are an integral part of these consolidated financial statements.
4
SKYWORKS SOLUTIONS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited, in thousands)
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Six-months Ended |
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April 1, |
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April 2, |
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2011 |
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2010 |
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Cash flows from operating activities: |
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Net income |
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$ |
110,828 |
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$ |
55,754 |
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Adjustments to reconcile net income to net cash provided by operating activities: |
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Share-based compensation |
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28,145 |
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16,804 |
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Depreciation |
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27,882 |
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22,250 |
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Amortization of intangible assets |
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3,240 |
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3,001 |
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Amortization of discount and deferred financing costs on convertible debt |
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705 |
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1,836 |
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Contribution of common shares to savings and retirement plans |
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6,638 |
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5,600 |
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Deferred income taxes |
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5,205 |
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12,430 |
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Excess tax benefit from share-based payments |
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(10,887 |
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Loss on disposals of assets |
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28 |
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96 |
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Provision for losses (recoveries) on accounts receivable |
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(12 |
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260 |
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Changes in assets and liabilities: |
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Receivables |
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(8,108 |
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7,105 |
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Inventories |
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(25,308 |
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(18,366 |
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Other current and long-term assets |
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2,986 |
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(2,118 |
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Accounts payable |
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(18 |
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7,499 |
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Other current and long-term liabilities |
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15,721 |
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1,026 |
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Net cash provided by operating activities |
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157,045 |
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113,177 |
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Cash flows from investing activities: |
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Capital expenditures |
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(65,280 |
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(34,260 |
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Payments for acquisitions |
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(4,456 |
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(1,000 |
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Net cash used in investing activities |
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(69,736 |
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(35,260 |
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Cash flows from financing activities: |
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Retirement of 2007 Convertible Notes |
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(32,477 |
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Reacquisition of equity component of 2007 Convertible Notes |
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(15,148 |
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Payments on short term line of credit |
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(50,000 |
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Excess tax benefit from share-based payments F |
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10,887 |
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Change in restricted cash |
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5,466 |
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(265 |
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Repurchase of common stock payroll tax withholdings |
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(18,780 |
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(3,574 |
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Repurchase of common stock share repurchase program |
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(41,564 |
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Proceeds from exercise of stock options |
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57,226 |
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14,736 |
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Net cash used in financing activities |
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(36,765 |
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(36,728 |
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Net increase in cash and cash equivalents |
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50,544 |
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41,189 |
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Cash and cash equivalents at beginning of period |
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453,257 |
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364,221 |
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Cash and cash equivalents at end of period |
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$ |
503,801 |
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$ |
405,410 |
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Supplemental cash flow disclosures: |
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Taxes paid |
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$ |
9,844 |
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$ |
11,518 |
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Interest paid |
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$ |
263 |
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$ |
669 |
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The accompanying notes are an integral part of these consolidated financial statements.
5
SKYWORKS SOLUTIONS, INC.
NOTES TO UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION
Skyworks Solutions, Inc. together with its consolidated subsidiaries, (Skyworks or the Company)
is an innovator of high reliability analog and mixed signal semiconductors. Leveraging core
technologies, Skyworks offers diverse standard and custom linear products supporting automotive,
broadband, cellular infrastructure, energy management, industrial, medical, military and cellular
handset applications. The Companys portfolio includes amplifiers, attenuators, detectors, diodes,
directional couplers, front-end modules, hybrids, infrastructure RF subsystems,
mixers/demodulators, phase shifters, PLLs/synthesizers/VCOs, power dividers/combiners, receivers,
switches and technical ceramics.
The accompanying unaudited interim consolidated financial statements have been prepared pursuant to
the rules and regulations of the Securities and Exchange Commission (SEC) for interim financial
reporting. Certain information and footnote disclosures, normally included in annual consolidated
financial statements prepared in accordance with accounting principles generally accepted in the
United States of America (GAAP), have been condensed or omitted pursuant to those rules and
regulations. However, in the opinion of management, the financial information reflects all
adjustments, consisting of adjustments of a normal recurring nature necessary to present fairly the
financial position, results of operations, and cash flows of the Company for the periods presented.
The results of operations for the interim periods are not necessarily indicative of the results to
be expected for the full year. This information should be read in conjunction with the Companys
financial statements and notes thereto contained in the Companys Form 10-K for the fiscal year
ended October 1, 2010 as filed with the SEC.
The Company evaluates its estimates on an ongoing basis using historical experience and other
factors, including the current economic environment. Significant judgment is required in
determining the fair value of marketable securities in inactive markets as well as determining when
declines in fair value constitute an other-than-temporary impairment. In addition, significant
judgment is required in determining whether a potential indicator of impairment of our long-lived
assets exists and in estimating future cash flows for any necessary
impairment tests. Managements estimates are based on historical
experience and actual results could differ
significantly.
The Company has evaluated subsequent events through the date of issuance of these unaudited
consolidated financial statements.
The Companys fiscal year ends each year on the Friday closest to September 30. Fiscal 2011
consists of 52 weeks and ends on September 30, 2011. Fiscal 2010 consisted of 52 weeks and ended on
October 1, 2010. The second quarters of fiscal 2011 and fiscal 2010 each consisted of 13 weeks and
ended on April 1, 2011 and April 2, 2010, respectively.
2. MARKETABLE SECURITIES
The
Company accounts for its investment in marketable securities in accordance with ASC 320 Investments-Debt and Equity
Securities (ASC 320), and classifies them as available for sale. As of April 1, 2011, these
securities consisted of $3.2 million par value auction rate securities (ARS) with a carrying
value of $2.3 million. The difference between the par value and
the carrying value is categorized as a
temporary loss in other comprehensive income. The Company closely monitors and evaluates the
appropriate accounting treatment in each reporting period for the ARS.
3. FINANCIAL INSTRUMENTS
In accordance with ASC 820 Fair Value Measurements and Disclosure (ASC 820), the Company
groups its financial assets and liabilities measured at fair value on a recurring basis in three
levels, based on the markets in which the assets and liabilities are traded and the reliability of
the assumptions used to determine fair value. These levels are:
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Level 1 Valuation is based upon quoted market price for identical instruments traded
in active markets. |
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Level 2 Valuation is based on quoted market prices for similar instruments in active
markets, quoted prices for identical or similar instruments in markets that are not active,
and model-based valuation techniques for which all significant assumptions are observable in
the market. |
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Level 3 Valuation is generated from model-based techniques that use significant
assumptions not observable in the market. Valuation techniques include use of discounted
cash flow models and similar techniques. |
The Company has cash equivalents classified as Level 1 and has no Level 2 securities. The Companys
ARS, discussed in Note 2, Marketable Securities, are classified as Level 3 assets. There have been
no transfers between Level 1, Level 2 or Level 3 assets during the three and six-months ended April
1, 2011. There have been no purchases, sales, issuances or settlements of the marketable securities
classified as Level 3 assets during the three and six-months ended April 1, 2011.
Financial Instruments Measured at Fair Value on a Recurring Basis
The following table presents the balances of cash equivalents and marketable securities measured at
fair value on a recurring basis as of April 1, 2011 (in thousands):
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Fair Value Measurements |
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Quoted Prices in |
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|
|
|
Active Markets for |
|
|
Significant Other |
|
|
Significant |
|
|
|
|
|
|
|
Identical Assets |
|
|
Observable Inputs |
|
|
Unobservable Inputs |
|
|
|
Total |
|
|
(Level 1) |
|
|
(Level 2) |
|
|
(Level 3) |
|
Money market/repurchase agreements |
|
$ |
479,305 |
|
|
$ |
479,305 |
|
|
$ |
|
|
|
$ |
|
|
Auction rate securities |
|
|
2,288 |
|
|
|
|
|
|
|
|
|
|
|
2,288 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
481,593 |
|
|
$ |
479,305 |
|
|
$ |
|
|
|
$ |
2,288 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Financial Assets Measured at Fair Value on a Nonrecurring Basis
The Companys non-financial assets, such as goodwill, intangible assets, and other long lived
assets resulting from business combinations are measured at fair value at the date of acquisition
and subsequently re-measured if there is an indicator of impairment or annually as in the case of
goodwill or trademarks. There were no indicators of impairment identified during the three and
six-months ended April 1, 2011.
4. INVENTORIES
Inventories consist of the following (in thousands):
|
|
|
|
|
|
|
|
|
|
|
As of |
|
|
|
April 1, |
|
|
October 1, |
|
|
|
2011 |
|
|
2010 |
|
Raw materials |
|
$ |
12,578 |
|
|
$ |
16,108 |
|
Work in process |
|
|
75,448 |
|
|
|
74,701 |
|
Finished goods |
|
|
49,162 |
|
|
|
20,209 |
|
Finished goods on consignment by customers |
|
|
13,991 |
|
|
|
14,041 |
|
|
|
|
|
|
|
|
Total inventories |
|
$ |
151,179 |
|
|
$ |
125,059 |
|
|
|
|
|
|
|
|
5. PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment consist of the following (in thousands):
7
|
|
|
|
|
|
|
|
|
|
|
As of |
|
|
|
April 1, |
|
|
October 1, |
|
|
|
2011 |
|
|
2010 |
|
Land and improvements |
|
$ |
10,082 |
|
|
$ |
10,082 |
|
Buildings and improvements |
|
|
48,034 |
|
|
|
47,734 |
|
Furniture and fixtures |
|
|
24,777 |
|
|
|
24,784 |
|
Machinery and equipment |
|
|
497,197 |
|
|
|
455,157 |
|
Construction in progress |
|
|
47,531 |
|
|
|
28,901 |
|
|
|
|
|
|
|
|
Total property, plant and equipment, gross |
|
|
627,621 |
|
|
|
566,658 |
|
Accumulated depreciation and amortization |
|
|
(385,888 |
) |
|
|
(362,295 |
) |
|
|
|
|
|
|
|
Total property, plant and equipment, net |
|
$ |
241,733 |
|
|
$ |
204,363 |
|
|
|
|
|
|
|
|
6. GOODWILL AND INTANGIBLE ASSETS
Goodwill and intangible assets consist of the following (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted |
|
|
|
|
|
|
|
|
|
Average |
|
|
|
|
|
|
|
|
|
Amortization |
|
|
As of |
|
|
As of |
|
|
|
Period |
|
|
April 1, 2011 |
|
|
October 1, 2010 |
|
|
|
Remaining |
|
|
Gross Carrying |
|
|
Accumulated |
|
|
Net Carrying |
|
|
Gross Carrying |
|
|
Accumulated |
|
|
Net Carrying |
|
|
|
(Years) |
|
|
Amount |
|
|
Amortization |
|
|
Amount |
|
|
Amount |
|
|
Amortization |
|
|
Amount |
|
Goodwill |
|
|
|
|
|
$ |
485,543 |
|
|
$ |
|
|
|
$ |
485,543 |
|
|
$ |
485,587 |
|
|
$ |
|
|
|
$ |
485,587 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortized intangible
assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Developed technology |
|
|
1.8 |
|
|
$ |
16,150 |
|
|
$ |
(12,176 |
) |
|
$ |
3,974 |
|
|
$ |
14,150 |
|
|
$ |
(10,862 |
) |
|
$ |
3,288 |
|
Customer relationships |
|
|
1.4 |
|
|
|
21,510 |
|
|
|
(17,380 |
) |
|
|
4,130 |
|
|
|
21,510 |
|
|
|
(15,894 |
) |
|
|
5,616 |
|
Patents and other |
|
|
2.4 |
|
|
|
8,216 |
|
|
|
(6,070 |
) |
|
|
2,146 |
|
|
|
5,966 |
|
|
|
(5,630 |
) |
|
|
336 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
45,876 |
|
|
|
(35,626 |
) |
|
|
10,250 |
|
|
|
41,626 |
|
|
|
(32,386 |
) |
|
|
9,240 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonamortizing intangible assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trademarks |
|
|
|
|
|
|
3,269 |
|
|
|
|
|
|
|
3,269 |
|
|
|
3,269 |
|
|
|
|
|
|
|
3,269 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total intangible assets |
|
|
|
|
|
$ |
49,145 |
|
|
$ |
(35,626 |
) |
|
$ |
13,519 |
|
|
$ |
44,895 |
|
|
$ |
(32,386 |
) |
|
$ |
12,509 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization expense related to intangible assets was $1.6 million and $3.2 million for the
three and six-months ended April 1, 2011, respectively. Amortization expense was $1.5 million and
$3.0 million for the three and six-months ended April 2, 2010, respectively.
The changes in the gross carrying amount of goodwill and intangible assets are as follows (in
thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Goodwill and Intangible Assets |
|
|
|
|
|
|
|
Developed |
|
|
Customer |
|
|
Patents and |
|
|
|
|
|
|
|
|
|
Goodwill |
|
|
Technology |
|
|
Relationships |
|
|
Other |
|
|
Trademarks |
|
|
Total |
|
Balance as of October 1, 2010 |
|
$ |
485,587 |
|
|
$ |
14,150 |
|
|
$ |
21,510 |
|
|
$ |
5,966 |
|
|
$ |
3,269 |
|
|
$ |
530,482 |
|
Additions (deductions) during
period |
|
|
(44 |
) |
|
|
2,000 |
|
|
|
|
|
|
|
2,250 |
|
|
|
|
|
|
|
4,206 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of April 1, 2011 |
|
$ |
485,543 |
|
|
$ |
16,150 |
|
|
$ |
21,510 |
|
|
$ |
8,216 |
|
|
$ |
3,269 |
|
|
$ |
534,688 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Company tests its goodwill and trademarks for impairment annually as of the first day of
its fourth fiscal quarter and in interim periods if certain events occur indicating that the
carrying value of goodwill may be impaired. There were no indicators of impairment noted during the
three and six-months ended April 1, 2011.
8
Annual amortization expense related to intangible assets for the next five years is expected to be
as follows (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Remaining |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FY 2011 |
|
|
FY 2012 |
|
|
FY 2013 |
|
|
FY 2014 |
|
|
FY 2015 |
|
Amortization expense |
|
$ |
3,278 |
|
|
$ |
5,371 |
|
|
$ |
1,532 |
|
|
$ |
69 |
|
|
$ |
|
|
7. BORROWING ARRANGEMENTS
Long-Term Debt
On March 2, 2007, the Company issued $200.0 million aggregate principal amount of convertible
subordinated notes (2007 Convertible Notes). The offering contained two tranches. The first
tranche consisted of $100.0 million of 1.25% convertible subordinated notes due March 2010 (the
1.25% Notes) which have been retired. The second tranche consisted of $100.0
million aggregate principal amount of 1.50% convertible subordinated notes due March 2012 (the
1.50% Notes).
As of April 1, 2011, $26.7 million in aggregate principal amount of 1.50% Notes remained outstanding.
The Company pays interest in cash semi-annually in arrears on March 1 and September
1 of each year on the 1.50% Notes. The conversion price of the 1.50% Notes is 105.0696 shares per
$1,000 principal amount of notes to be redeemed, which is the equivalent of a conversion price of
approximately $9.52 per share, plus accrued and unpaid interest, if any, to the conversion date.
Holders of the remaining of the $26.7 aggregate principal balance of the 1.50% Notes may require
the Company to repurchase the 1.50% Notes upon a change in control of the Company.
Holders may convert the 1.50% Notes at any time on or prior to the close of business on the final
maturity date. If a holder of a 1.50% Note elects to convert such Notes at maturity, the Company
may continue to choose to deliver to the holder either cash, shares of its common stock or a
combination of cash and shares of its common stock to settle the conversion. This cash settlement
provision permits the application of the treasury stock method in determining potential share
dilution of the conversion spread should the share price of the Companys common stock exceed
$9.52. It has been the Companys historical practice to cash settle the principal and interest
components of convertible debt instruments, and it is the Companys intention to continue to do so
in the future, including with respect to the 1.50% Notes.
As of April 1, 2011, the $25.4 million carrying value of the 1.50% Notes was deemed a current liability and accordingly
was reclassified as short-term debt. Long-term debt consists of
convertible notes with a
carrying value of $24.7 million as of October 1, 2010.
As of April 1, 2011, based on a stock
price of $31.45, the actual if converted value of the
remaining 1.50% Notes was $88.1 million
which exceeds the related principal amount by approximately $61.4 million.
On October 3, 2009, the Company adopted ASC 470-20 Debt, Debt with Conversions and Other Options
(ASC 470-20). ASC 470-20 applies to the Companys 2007 Convertible Notes. Using a non-convertible
borrowing rate of 6.86%, the Company estimated the fair value of the liability component of the
$100.0 million aggregate principal amount of the 1.50% Notes to be $77.3 million on October 3,
2009. As of the issuance date, the difference between the fair value of the liability component of
the 1.50% Notes and the corresponding aggregate principal amount of such notes, which is equal to
the fair value of the equity component of the 1.50% Notes ($22.7 million), was retrospectively
recorded as a debt discount and as an increase to additional paid-in capital, net of tax. The
discount of the liability component of the 1.50% Notes is being amortized over the remaining life
of the instrument.
The following tables provide additional information about the Companys 1.50% Notes (in thousands):
|
|
|
|
|
|
|
|
|
|
|
As of |
|
|
|
April 1, |
|
|
October 1, |
|
|
|
2011 |
|
|
2010 |
|
Equity component of the convertible notes outstanding |
|
$ |
6,061 |
|
|
$ |
6,061 |
|
Principal amount of the convertible notes |
|
|
26,677 |
|
|
|
26,677 |
|
Unamortized discount of the liability component |
|
|
1,272 |
|
|
|
1,934 |
|
Net carrying amount of the liability component |
|
|
25,405 |
|
|
|
24,743 |
|
9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three-months Ended |
|
|
Six-months Ended |
|
|
|
April 1, |
|
|
April 2, |
|
|
April 1, |
|
|
April 2, |
|
|
|
2011 |
|
|
2010 |
|
|
2011 |
|
|
2010 |
|
Effective interest rate on the liability component |
|
|
6.86 |
% |
|
|
6.86 |
% |
|
|
6.86 |
% |
|
|
6.86 |
% |
Cash interest expense recognized (contractual interest) |
|
$ |
100 |
|
|
$ |
234 |
|
|
$ |
200 |
|
|
$ |
513 |
|
Effective interest expense recognized |
|
$ |
333 |
|
|
$ |
713 |
|
|
$ |
661 |
|
|
$ |
1,702 |
|
The remaining unamortized discount on the 1.50% Notes will be amortized over the next eleven
months. As of both April 1, 2011 and October 1, 2010, the number of shares underlying the remaining
1.50% Notes was 2.8 million.
Short-Term Debt
As of April 1, 2011, the $25.4 million carrying value of the 1.50% Notes
was deemed a current liability and accordingly
was reclassified as short-term debt.
On July 15, 2003, the Company entered into a receivables purchase agreement under which it agreed
to sell from time to time certain of its accounts receivable to Skyworks USA, Inc. (Skyworks
USA), a wholly-owned special purpose entity that is consolidated for accounting purposes.
Concurrently, Skyworks USA entered into an agreement with Wachovia Bank, N.A. providing for a $50.0
million credit facility (the Credit Facility) secured by the purchased accounts receivable. The
Companys short-term debt balance as of October 1, 2010 was $50.0 million. The Company paid down
the entire $50.0 million balance and terminated the Credit Facility and all associated agreements
during the first quarter of fiscal 2011.
8. INCOME TAXES
The Company recorded income tax provisions of $17.5 million and $33.4 million for the three and six-months
ended April 1, 2011, respectively, and $9.1 million and $21.9 million for the three and six-months
ended April 2, 2010, respectively. The provision for income taxes for the three and six-months
ended April 1, 2011 consisted of $16.4 million and $31.7 million of United States income taxes,
respectively, and $8.8 million and $21.3 million for the three and six-months ended April 2, 2010,
respectively. The provision for income taxes for the three and six-months ended April 1, 2011
consisted of $1.1 million and $1.7 million of foreign income taxes, respectively, and $0.3 million
and $0.6 million for the three and six-months ended April 2, 2010, respectively.
For the three and six-months ended April 1, 2011, the difference between the Companys effective
tax rate and the 35% U.S. federal statutory rate resulted primarily from foreign earnings taxed at
rates lower than the federal statutory rate and the recognition of research and development tax
credits earned. In December 2010, the United States Congress enacted legislation to retroactively
extend the federal research and development tax credit. As a result, the Company recognized $4.8
million of federal research and development tax credits in the six-months ended April 1, 2011,
which were earned in the fiscal year ended October 1, 2010. For the three and six-months ended
April 2, 2010, the difference between the Companys effective tax rate and the 35% federal
statutory rate resulted primarily from foreign earnings taxed at rates lower than the United States
federal statutory rate, and the change in assessment as to reinvestment of earnings to United
States deferred taxes related to the transfer of assets to an affiliated foreign company.
On October 2, 2010, the Company expanded its presence in Asia by launching operations in Singapore.
The Company operates under a tax holiday in Singapore, which is effective through September 30,
2020. The tax holiday is conditional upon the Companys compliance in meeting certain employment
and investment thresholds in Singapore.
In accordance with ASC 740 Income Taxes (ASC 740), management has determined that it is more
likely than not that a portion of the Companys historic and current year income tax benefits will
not be realized. Accordingly, as of April 1, 2011, the Company has maintained a valuation allowance
of $24.0 million related to the Companys United States deferred tax assets, primarily related to
the Companys state tax research and experimentation credits. Deferred tax assets have been
recognized for foreign operations when management believes that it is more likely than not that
they will be recovered during the carryforward period. We have also previously determined that it
is more likely than not that a portion of the Companys
10
foreign income tax benefits will not be
realized and maintain a valuation allowance of $1.6 million related to the Companys foreign
deferred tax assets.
Realization of benefits from the Companys deferred tax asset, net of valuation allowance is
dependent upon generating United States source taxable income in the
future. The existing
valuation allowance could be reversed in the future to the extent that the related deferred tax
assets no longer require a valuation allowance under the provisions of ASC 740.
The Company will continue to evaluate its valuation allowance in future periods and depending upon
the outcome of that assessment, additional amounts could be reversed or recorded and recognized as
an adjustment to income tax benefit or
expense. Such adjustments could cause our effective income tax rate to vary in future periods. The
Company will need to generate $138.4 million of United States federal taxable income in future
years to utilize all of the Companys net operating loss carryforwards, research and
experimentation tax credit carryforwards, and deferred income tax temporary differences, net of
valuation allowance as of April 1, 2011.
During the quarter ended April 1, 2011, there was an increase in the Companys gross unrecognized
tax benefits of $1.4 million. The Companys gross unrecognized tax benefits totaled $23.8 million
as of April 1, 2011. Of the total unrecognized tax benefits at April 1, 2011, $14.9 million would
impact the effective tax rate, if recognized. The remaining unrecognized tax benefits would not
impact the effective tax rate, if recognized, due to the Companys valuation allowance and certain
positions which were required to be deferred. There are no positions which we anticipate could
change within the next twelve months. The Company did not incur significant interest or penalties
related to unrecognized tax benefits during the quarter ended April 1, 2011. The Companys policy
is to recognize accrued interest and penalties, if incurred, on any unrecognized tax benefits as a
component of income tax expense.
The Companys major tax jurisdictions as of April 1, 2011 are the United States federal
jurisdiction, and the United States jurisdictions of California and Iowa. For the United States,
the Company has open tax years dating back to fiscal year 1998 due to the carry forward of tax
attributes. For California and Iowa, the Company has open tax years dating back to fiscal year 2002
due to the carry forward of tax attributes.
9. COMMITMENTS AND CONTINGENCIES
Legal Matters
From time to time, various lawsuits, claims and proceedings have been, and may in the future be,
instituted or asserted against the Company, including those pertaining to patent infringement,
intellectual property, environmental, product liability, safety and health, employment and
contractual matters.
Additionally, the semiconductor industry is characterized by vigorous protection and pursuit of
intellectual property rights. From time to time, third parties have asserted and may in the future
assert patent, copyright, trademark and other intellectual property rights to technologies that are
important to the Companys business and have demanded and may in the future demand that the Company
license their technology. The outcome of any such litigation cannot be predicted with certainty and
some such lawsuits, claims or proceedings may be disposed of unfavorably to the Company. Generally
speaking, intellectual property disputes often have a risk of injunctive relief, which, if imposed
against the Company, could materially and adversely affect the Companys financial condition, or
results of operations. From time to time the Company is also involved in legal proceedings in the
ordinary course of business.
The Company believes there is no litigation pending that will have, individually or in the
aggregate, a material adverse effect on its business.
Guarantees and Indemnifications
The Company has made no contractual guarantees for the benefit of third parties. However, the
Company generally indemnifies its customers from third-party intellectual property infringement
litigation claims related to its products, and, on occasion, also provides other indemnities
related to product sales. In connection with certain facility leases, the Company has indemnified
its lessors for certain claims arising from the facility or the lease.
11
The Company indemnifies its directors and officers to the maximum extent permitted under the laws
of the state of Delaware. The duration of the indemnities varies, and in many cases is indefinite.
The indemnities to customers in connection with product sales generally are subject to limits based
upon the amount of the related product sales and in many cases are subject to geographic and other
restrictions. In certain instances, the Companys indemnities do not provide for any limitation of
the maximum potential future payments the Company could be obligated to make. The Company has not
recorded any liability for these indemnities in the accompanying consolidated balance sheets and
does not expect that such obligations will have a material adverse impact on its financial
condition or results of operations.
10. SEGMENT INFORMATION
In accordance with ASC 280-Segment Reporting (ASC 280), the Company has one reportable operating
segment which designs, develops, manufactures and markets proprietary semiconductor products,
including intellectual property. ASC 280 establishes standards for the way public business
enterprises report information about operating segments in annual financial statements and in
interim reports to shareholders. The method for determining what information to report is based on
managements use of financial information for the purposes of assessing performance and making
operating decisions. In evaluating financial performance and making operating decisions, management
primarily uses consolidated net revenue, gross profit, operating profit and earnings per share. The
Companys business units share similar economic characteristics, long term business models,
research and development expenses and selling, general and administrative expenses. Furthermore,
the Companys chief operating decision makers base operating decisions on consolidated financial
information. As of April 1, 2011, there has been no change and the Company continues to consider
itself to have one reportable operating segment. The Company will re-assess its conclusions at
least annually.
11. EMPLOYEE STOCK BENEFIT PLANS
Share-based compensation expense consists of expense related to our unvested grants of employee
stock options and awards in accordance with ASC 718 Compensation-Stock Compensation (ASC 718).
The following table summarizes share-based compensation expense related to unvested employee stock
options, restricted and performance stock grants, management incentive compensation, and our
employee stock purchase plan for the three and six-months ended April 1, 2011 and April 2, 2010, as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three-months Ended |
|
|
Six-months Ended |
|
|
|
April 1, |
|
|
April 2, |
|
|
April 1, |
|
|
April 2, |
|
(In thousands) |
|
2011 |
|
|
2010 |
|
|
2011 |
|
|
2010 |
|
Stock options |
|
$ |
4,111 |
|
|
$ |
3,137 |
|
|
$ |
7,951 |
|
|
$ |
6,172 |
|
Restricted stock with service and market conditions |
|
|
|
|
|
|
31 |
|
|
|
|
|
|
|
689 |
|
Restricted stock with service conditions |
|
|
494 |
|
|
|
206 |
|
|
|
963 |
|
|
|
413 |
|
Performance shares |
|
|
8,426 |
|
|
|
3,777 |
|
|
|
15,733 |
|
|
|
6,644 |
|
Management incentive plan stock awards |
|
|
1,240 |
|
|
|
1,123 |
|
|
|
2,284 |
|
|
|
2,006 |
|
Employee stock purchase plan |
|
|
593 |
|
|
|
446 |
|
|
|
1,214 |
|
|
|
880 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total share-based compensation expense |
|
$ |
14,864 |
|
|
$ |
8,720 |
|
|
$ |
28,145 |
|
|
$ |
16,804 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Company utilized the following weighted average assumptions in calculating its share-based
compensation expense using the Black-Scholes model as of the six-months ended April 1, 2011 and
April 2, 2010:
12
|
|
|
|
|
|
|
|
|
|
|
Six-months Ended |
|
|
|
April 1, |
|
|
April 2, |
|
|
|
2011 |
|
|
2010 |
|
Expected volatility |
|
|
49.26 |
% |
|
|
56.19 |
% |
Risk free interest rate (7 year contractual life options) |
|
|
1.59 |
% |
|
|
2.02 |
% |
Dividend yield |
|
|
0.00 |
|
|
|
0.00 |
|
Expected option life (7 year contractual life options) |
|
|
4.10 |
|
|
|
4.23 |
|
12. ACCUMULATED OTHER COMPREHENSIVE LOSS
The Company accounts for comprehensive loss in accordance with the provisions of ASC 220
Comprehensive Income (ASC 220). ASC 220 is a financial statement presentation standard that
requires the Company to disclose non-owner changes included in equity but not included in net
income or loss. Accumulated other comprehensive loss presented in the financial statements consists
of adjustments to the Companys auction rate securities and minimum pension liability. There were
no changes in the value of the auction rate securities or pension liability during the three and
six-months ended April 1, 2011.
13. COMMON STOCK REPURCHASE
On August 3, 2010 the Board of Directors approved a stock repurchase program, pursuant to which the
Company is authorized to repurchase up to $200.0 million of the Companys common stock from time to
time on the open market or in privately negotiated transactions as permitted by securities laws and
other legal requirements. During the three-months ended April 1, 2011 the Company paid
approximately $23.3 million in connection with the repurchase of 731,645 shares of its common stock
(paying an average price of $31.90 per share). During the six-months ended April 1, 2011, the
Company paid approximately $41.6 million (including commissions) in connection with the repurchase
of 1,518,045 shares of its common stock (paying an average price of $27.37 per share). As of April
1, 2011, $158.5 million remained available under the existing share repurchase authorization.
14. EARNINGS PER SHARE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three-months Ended |
|
|
Six-months Ended |
|
|
|
April 1, |
|
|
April 2, |
|
|
April 1, |
|
|
April 2, |
|
(In thousands, except per share amounts) |
|
2011 |
|
|
2010 |
|
|
2011 |
|
|
2010 |
|
Net income |
|
$ |
49,960 |
|
|
$ |
27,744 |
|
|
$ |
110,828 |
|
|
$ |
55,754 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding basic |
|
|
183,471 |
|
|
|
174,449 |
|
|
|
182,088 |
|
|
|
173,583 |
|
Effect of dilutive convertible debt |
|
|
1,989 |
|
|
|
2,169 |
|
|
|
1,851 |
|
|
|
2,079 |
|
Effect of dilutive share-based awards |
|
|
6,501 |
|
|
|
6,306 |
|
|
|
6,312 |
|
|
|
5,502 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding diluted |
|
|
191,961 |
|
|
|
182,924 |
|
|
|
190,251 |
|
|
|
181,164 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per share basic |
|
$ |
0.27 |
|
|
$ |
0.16 |
|
|
$ |
0.61 |
|
|
$ |
0.32 |
|
Effect of dilutive convertible debt |
|
|
|
|
|
|
|
|
|
|
(0.01 |
) |
|
|
|
|
Effect of dilutive share-based awards |
|
|
(0.01 |
) |
|
|
(0.01 |
) |
|
|
(0.02 |
) |
|
|
(0.01 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per share diluted |
|
$ |
0.26 |
|
|
$ |
0.15 |
|
|
$ |
0.58 |
|
|
$ |
0.31 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share is calculated by dividing net income by the weighted average number of
common shares outstanding. Diluted earnings per share includes the dilutive effect of equity based
awards and the 2007 Convertible Notes using the treasury stock method.
Equity based awards exercisable for approximately 0.1 million shares and 5.8 million shares were
outstanding but not included in the computation of earnings per share for the three-months ended
April 1, 2011 and April 2, 2010, respectively, as their effect would have been anti-dilutive.
13
Equity based awards exercisable for approximately 0.9 million shares and 5.9 million shares were
outstanding but not included in the computation of earnings per share for the six-months ended
April 1, 2011 and April 2, 2010, respectively, as their effect would have been anti-dilutive.
The remaining $26.7 million in aggregate principal balance of the 1.50% Notes contains a cash
settlement provision, which permits the application of the treasury stock method in determining
potential share dilution of the conversion spread should the share price of the Companys common
stock exceed $9.52. For the three and six-months ended April 1, 2011, 2.0 million and 1.9 million
shares, respectively, were included in the calculation of diluted earnings per share as a result of
this conversion feature and 2.2 million shares and 2.1 million shares for the three and six-months
ended April 2, 2010, respectively, were included.
Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
This report and other documents we have filed with the Securities and Exchange Commission (SEC)
contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933,
as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended (the Exchange
Act), and are subject to the safe harbor created by those sections. Words such as believes,
expects, may, will, would, should, could, seek, intends, plans, potential,
continue, estimates, anticipates, predicts, and similar expressions or variations or
negatives of such words are intended to identify forward-looking statements, but are not the
exclusive means of identifying forward-looking statements in this report. Additionally, statements
concerning future matters such as the development of new products, enhancements or technologies,
sales levels, expense levels and other statements regarding matters that are not historical are
forward-looking statements. Although forward-looking statements in this report reflect the good
faith judgment of our management, such statements can only be based on facts and factors currently
known by us. Consequently, forward-looking statements involve inherent risks and uncertainties and
actual results and outcomes may differ materially and adversely from the results and outcomes
discussed in or anticipated by the forward-looking statements. A number of important factors could
cause actual results to differ materially and adversely from those in the forward-looking
statements. We urge you to consider the risks and uncertainties discussed in our Annual Report on
Form 10-K for the fiscal year ended October 1, 2010, under the heading Risk Factors and in the
other documents we have filed with the SEC in evaluating our forward-looking statements. We have no
plans, and undertake no obligation, to revise or update our forward-looking statements to reflect
any event or circumstance that may arise after the date of this report. We caution readers not to
place undue reliance upon any such forward-looking statements, which speak only as of the date
made.
In this document, the words we, our, ours and us refer only to Skyworks Solutions, Inc. and
its subsidiaries and not any other person or entity.
14
RESULTS OF OPERATIONS
THREE AND SIX-MONTHS ENDED APRIL 1, 2011 AND APRIL 2, 2010
The following table sets forth the results of our
operations expressed as a percentage of net
revenue for the three and six-months ended April 1, 2011 and April 2, 2010:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three-months Ended |
|
|
Six-months Ended |
|
|
|
April 1, |
|
|
April 2, |
|
|
April 1, |
|
|
April 2, |
|
|
|
2011 |
|
|
2010 |
|
|
2011 |
|
|
2010 |
|
Net revenue |
|
|
100.0 |
% |
|
|
100.0 |
% |
|
|
100.0 |
% |
|
|
100.0 |
% |
Cost of goods sold |
|
|
56.7 |
|
|
|
58.1 |
|
|
|
56.2 |
|
|
|
58.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit |
|
|
43.3 |
|
|
|
41.9 |
|
|
|
43.8 |
|
|
|
41.9 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
|
12.2 |
|
|
|
13.5 |
|
|
|
11.8 |
|
|
|
13.2 |
|
Selling, general and administrative |
|
|
9.7 |
|
|
|
11.8 |
|
|
|
9.5 |
|
|
|
11.3 |
|
Amortization of intangibles |
|
|
0.5 |
|
|
|
0.6 |
|
|
|
0.5 |
|
|
|
0.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating expenses |
|
|
22.4 |
|
|
|
25.9 |
|
|
|
21.8 |
|
|
|
25.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income |
|
|
20.9 |
|
|
|
16.0 |
|
|
|
22.0 |
|
|
|
16.8 |
|
Interest expense |
|
|
(0.1 |
) |
|
|
(0.5 |
) |
|
|
(0.2 |
) |
|
|
(0.6 |
) |
Loss on early retirement of
convertible debt |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other loss, net |
|
|
|
|
|
|
(0.1 |
) |
|
|
|
|
|
|
(0.1 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income taxes |
|
|
20.8 |
|
|
|
15.4 |
|
|
|
21.8 |
|
|
|
16.1 |
|
Provision for income taxes |
|
|
5.4 |
|
|
|
3.8 |
|
|
|
5.0 |
|
|
|
4.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
|
15.4 |
% |
|
|
11.6 |
% |
|
|
16.8 |
% |
|
|
11.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
GENERAL
During the three and six-months ended April 1, 2011, certain key factors contributed to our overall
results of operations and cash flows from operations. Specifically:
|
|
|
We generated net revenue of $325.4 million in the seasonally low quarter ended April 1,
2011, which was a 36.7% increase over the $238.1 million for the
corresponding period in fiscal 2010. For the six-months ended
April 1, 2011 net revenue was $660.5 million, an increase of
36.7% over the $483.2 million generated for the six-months ended April 2, 2010. The
growth in net revenue was principally attributable to an increase in
our overall market share, product
revenue diversification, and the increased overall demand for our wireless
semiconductor products that support mobile internet capabilities in
devices such as smart phones, tablets and home
automation systems as well as supporting wireless infrastructure, energy management and
diversified analog applications. |
|
|
|
|
Gross profit increased by $41.1 million or 140 basis points to 43.3% of net revenue for
the three-months ended April 1, 2011, as compared to the corresponding period in fiscal
2010. For the six-months ended April 1, 2011, gross profit increased by $87.1 million or
190 basis points to 43.8% of net revenue as compared to the corresponding period in fiscal
2010. The increase in gross profit in aggregate dollars and as a percentage of net revenue
is primarily the result of improved product mix, continued factory process and productivity
enhancements, product end-to-end yield improvements, year-over-year material cost
reductions, the impact of margin enhancing capital expenditures, and the
aforementioned increase in net revenue. |
|
|
|
|
For the three-months ended April 1, 2011, operating income increased by $29.7 million to
20.9% of net revenue, a 77.6% increase over the corresponding period in fiscal 2010. For the
six-months ended April 1, 2011, operating income increased by
$64.6 million to 22.0% of net
revenue, a 79.9% increase over the corresponding period in fiscal 2010. The increase is
primarily due to the aforementioned increases in net revenue and gross margin along with a
higher degree of operating leverage. |
15
|
|
|
For the six-months ended April 1, 2011, we generated $157.0 million in cash from
operations and exited the quarter with $504.5 million in cash, cash
equivalents and restricted cash. |
|
We have been closely monitoring the implications of the
recent earthquakes in Japan on our business. With respect to our
supply chain, we currently foresee no supply disruptions as a result
of the earthquake. We believe that through a combination of inventory
on-hand, multi-sourced components and in some cases bringing on
alternate sources of supply, we will ensure supply
continuity going forward. However we continue to closely monitor the
situation as uncertainties do still exist as events in Japan
continue to unfold.
NET REVENUE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three-months Ended |
|
|
|
|
|
|
|
|
|
|
Six-months Ended |
|
|
|
|
|
|
April 1, |
|
|
|
|
|
|
April 2, |
|
|
April 1, |
|
|
|
|
|
|
April 2, |
|
(dollars in thousands) |
|
2011 |
|
|
Change |
|
|
2010 |
|
|
2011 |
|
|
Change |
|
|
2010 |
|
Net revenue |
|
$ |
325,411 |
|
|
|
36.7% |
|
|
$ |
238,058 |
|
|
$ |
660,531 |
|
|
|
36.7% |
|
|
$ |
483,196 |
|
We market and sell our products directly to Original Equipment Manufacturers (OEMs) of
communication electronic products, third-party Original Design Manufacturers (ODMs), contract
manufacturers, and indirectly through electronic components distributors. We periodically enter
into revenue generating arrangements that leverage our broad intellectual property portfolio by
licensing or selling our non-core patents or other intellectual property. We anticipate continuing
this intellectual property strategy in future periods.
We generated net revenue of $325.4 million in the seasonally low quarter ended April 1, 2011,
which was a 36.7% increase over the $238.1 million for
the corresponding period in fiscal 2010. For
the six-months ended April 1, 2011 net revenue was $660.5 million, an increase of 36.7% over the
$483.2 million generated for the six-months ended April 2,
2010. The growth in net revenue was principally
attributable to an increase in our overall market share, product
revenue diversification, and the increased overall demand for our wireless semiconductor products that support mobile
internet capabilities in products such as smart phones, tablets and home automation systems as well as supporting wireless
infrastructure, energy management and diversified analog applications.
GROSS PROFIT
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three-months Ended |
|
|
|
|
|
|
|
|
|
|
Six-months Ended |
|
|
|
|
|
|
April 1, |
|
|
|
|
|
|
April 2, |
|
|
April 1, |
|
|
|
|
|
|
April 2, |
|
(dollars in thousands) |
|
2011 |
|
|
Change |
|
|
2010 |
|
|
2011 |
|
|
Change |
|
|
2010 |
|
Gross profit |
|
$ |
140,981 |
|
|
|
41.2% |
|
|
$ |
99,854 |
|
|
$ |
289,519 |
|
|
|
43.0% |
|
|
$ |
202,408 |
|
% of net revenue |
|
|
43.3 |
% |
|
|
|
|
|
|
41.9 |
% |
|
|
43.8 |
% |
|
|
|
|
|
|
41.9 |
% |
Gross profit represents net revenue less cost of goods sold. Cost of goods sold consists primarily
of purchased materials, labor and overhead (including depreciation and equity based compensation
expense) associated with product manufacturing.
Gross profit increased by $41.1 million or 140 basis points to 43.3% of net revenue for the
three-months ended April 1, 2011, as compared to the corresponding period in fiscal 2010. For the
six-months ended April 1, 2011, gross profit increased by $87.1 million or 190 basis points to
43.8% of net revenue as compared to the corresponding period in fiscal 2010. The increase in
gross profit in aggregate dollars and as a percentage of net revenue is primarily the result of
improved product mix, continued factory process and productivity enhancements, product end-to-end
yield improvements, year-over-year material cost reductions, the
impact of margin enhancing
capital expenditures, and the aforementioned increase in net revenue. As in the corresponding prior period, during the three-months ended April 1, 2011, we continued to benefit from higher contribution margins associated with
the licensing and/or sale of intellectual property.
RESEARCH AND DEVELOPMENT
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three-months Ended |
|
|
|
|
|
|
|
|
|
|
Six-months Ended |
|
|
|
|
|
|
April 1, |
|
|
|
|
|
|
April 2, |
|
|
April 1, |
|
|
|
|
|
|
April 2, |
|
(dollars in thousands) |
|
2011 |
|
|
Change |
|
|
2010 |
|
|
2011 |
|
|
Change |
|
|
2010 |
|
Research and
development |
|
$ |
39,618 |
|
|
|
23.6% |
|
|
$ |
32,060 |
|
|
$ |
78,161 |
|
|
|
22.4% |
|
|
$ |
63,849 |
|
% of net revenue |
|
|
12.2 |
% |
|
|
|
|
|
|
13.5 |
% |
|
|
11.8 |
% |
|
|
|
|
|
|
13.2 |
% |
Research and development expenses consist principally of direct personnel costs, costs for
pre-production evaluation and testing of new devices, masks and engineering prototypes, share-based
compensation expense and design and test tool costs.
16
The 23.6% and 22.4% increases in research and development expenses for the three and six-months
ended April 1, 2011, respectively, when compared to the corresponding periods in fiscal 2010 are
principally attributable to growth in the number of our employees and related compensation costs.
In addition, we increased our design activities and associated expenses in support of increased
product development for our target markets. Research and development expenses decreased as a
percentage of net revenue for the three and six months ended
April 1, 2011, as compared to the corresponding period in the
prior fiscal year, due to the aforementioned increase in net revenue.
SELLING, GENERAL AND ADMINISTRATIVE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three-months Ended |
|
|
|
|
|
|
|
|
|
|
Six-months Ended |
|
|
|
|
|
|
April 1, |
|
|
|
|
|
|
April 2, |
|
|
April 1, |
|
|
|
|
|
|
April 2, |
|
(dollars in thousands) |
|
2011 |
|
|
Change |
|
|
2010 |
|
|
2011 |
|
|
Change |
|
|
2010 |
|
Selling, general
and administrative |
|
$ |
31,665 |
|
|
|
13.2% |
|
|
$ |
27,982 |
|
|
$ |
62,716 |
|
|
|
14.6% |
|
|
$ |
54,713 |
|
% of net revenue |
|
|
9.7 |
% |
|
|
|
|
|
|
11.8 |
% |
|
|
9.5 |
% |
|
|
|
|
|
|
11.3 |
% |
Selling, general and administrative expenses include legal, accounting, treasury, human resources,
information systems, customer service, bad-debt expense, sales commissions, share-based
compensation expense, advertising, marketing and other costs.
The increase in selling, general and administrative expenses for the three and six-months ended
April 1, 2011, respectively, as compared to the corresponding period in fiscal 2010 is principally
due to growth in the number of our employees and related compensation expense. In addition,
share-based compensation expense increased primarily as a result of our increased stock price
during the fiscal year as compared to the prior year. Selling, general and administrative expenses
as a percentage of net revenue decreased for the three and six-months ended April 1, 2011, as
compared to the corresponding period in the prior fiscal year, due to the aforementioned increase
in net revenue.
AMORTIZATION OF INTANGIBLES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three-months Ended |
|
|
|
|
|
|
|
|
|
|
Six-months Ended |
|
|
|
|
|
|
April 1, |
|
|
|
|
|
|
April 2, |
|
|
April 1, |
|
|
|
|
|
|
April 2, |
|
(dollars in thousands) |
|
2011 |
|
|
Change |
|
|
2010 |
|
|
2011 |
|
|
Change |
|
|
2010 |
|
Amortization of
intangibles |
|
$ |
1,638 |
|
|
|
9.2% |
|
|
$ |
1,500 |
|
|
$ |
3,240 |
|
|
|
8.0% |
|
|
$ |
3,001 |
|
% of net revenue |
|
|
0.5 |
% |
|
|
|
|
|
|
0.6 |
% |
|
|
0.5 |
% |
|
|
|
|
|
|
0.6 |
% |
The marginal increase in amortization expense during the three and six-months ended April 1, 2011,
as compared to the corresponding periods in fiscal 2010, was due to intangible asset acquisitions
and subsequent amortization during the three and six-months ended April 1, 2011.
INTEREST EXPENSE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three-months Ended |
|
|
|
|
|
|
|
|
|
|
Six-months Ended |
|
|
|
|
|
|
April 1, |
|
|
|
|
|
|
April 2, |
|
|
April 1, |
|
|
|
|
|
|
April 2, |
|
(dollars in thousands) |
|
2011 |
|
|
Change |
|
|
2010 |
|
|
2011 |
|
|
Change |
|
|
2010 |
|
Interest expense |
|
$ |
461 |
|
|
|
(61.0)% |
|
|
$ |
1,183 |
|
|
$ |
998 |
|
|
|
(63.7)% |
|
|
$ |
2,752 |
|
% of net revenue |
|
|
0.1 |
% |
|
|
|
|
|
|
0.5 |
% |
|
|
0.2 |
% |
|
|
|
|
|
|
0.6 |
% |
Interest expense is comprised principally of interest related to our 2007 Convertible Notes which
has been calculated under ASC 470-20 Debt, Debt with Conversion and Other Options.
The decrease in interest expense for the three and six-months ended April 1, 2011, when compared to
the corresponding periods in fiscal 2010, was due to a decline in interest expense and amortization
of discount associated with the early retirement of a portion of the 2007 Convertible Notes during
fiscal 2010 and our repayment of the entire $50.0 million balance of our Credit Facility (see Note
7 of the Notes to Consolidated Financial Statements contained in Item 1 in this Quarterly Report on
Form 10-Q) during the first quarter of fiscal 2011.
17
PROVISION FOR INCOME TAXES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three-months Ended |
|
|
|
|
|
|
|
|
|
|
Six-months Ended |
|
|
|
|
|
|
April 1, |
|
|
|
|
|
|
April 2, |
|
|
April 1, |
|
|
|
|
|
|
April 2, |
|
(dollars in thousands) |
|
2011 |
|
|
Change |
|
|
2010 |
|
|
2011 |
|
|
Change |
|
|
2010 |
|
Provision for
income taxes |
|
$ |
17,525 |
|
|
|
92.5% |
|
|
$ |
9,104 |
|
|
$ |
33,393 |
|
|
|
52.5% |
|
|
$ |
21,896 |
|
% of net revenue |
|
|
5.4 |
% |
|
|
|
|
|
|
3.8 |
% |
|
|
5.0 |
% |
|
|
|
|
|
|
4.5 |
% |
The Company recorded a provision for income taxes of $17.5 million ($16.4 million and $1.1 million
for United States and foreign income taxes, respectively) and $33.4 million ($31.7 million and $1.7
million for United States and foreign income taxes, respectively) for the three and six-months
ended April 1, 2011, respectively.
The
effective tax rates for the three and six-months ended April 1, 2011 were 26.0% and 23.2%,
respectively, as compared to 24.7% and 28.2% for the corresponding periods in fiscal 2010,
respectively. The difference between the Companys year to date effective tax rate of
23.2% and the federal statutory rate of 35% is principally due to the recognition of foreign
earnings in lower tax jurisdictions and the recognition of research
and development tax credits earned.
As a result of the enactment of the Tax Relief Act of 2010 which retroactively reinstated and
extended the research and development tax credit, $4.8 million of federal research and development
tax credits which were earned in fiscal year 2010 reduced our tax rate during the six-months ended
April 1, 2011.
LIQUIDITY AND CAPITAL RESOURCES
Cash Provided and Used
|
|
|
|
|
|
|
|
|
|
|
Six-months Ended |
|
|
|
April 1, |
|
|
April 2, |
|
(dollars in thousands) |
|
2011 |
|
|
2010 |
|
Cash and cash equivalents at beginning of period (1) |
|
$ |
453,257 |
|
|
$ |
364,221 |
|
Net cash provided by operating activities |
|
|
157,045 |
|
|
|
113,177 |
|
Net cash used in investing activities |
|
|
(69,736 |
) |
|
|
(35,260 |
) |
Net cash used in financing activities |
|
|
(36,765 |
) |
|
|
(36,728 |
) |
|
|
|
|
|
|
|
Cash and cash equivalents at end of period (1) |
|
$ |
503,801 |
|
|
$ |
405,410 |
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
Cash and cash equivalents do not include restricted cash balances. |
Cash Flows from Operating Activities:
Cash provided by operating activities is net income adjusted for certain non-cash items and changes
in certain assets and liabilities.
For the six-months ended April 1,
2011, net income increased by $55.1 million to $110.8 million when compared to the corresponding
period in fiscal 2010.
For the six-months ended April 1, 2011 we generated $157.0
million in cash flow from operations, an increase of $43.9 million when compared to the $113.2
million generated in the corresponding period in fiscal 2010.
The increase cash from operations was primarily due to the increase in net
income for the six-month period and changes in non-cash items offset by our investments in working
capital as a result of higher business activity. Specifically, the working capital increase was due
to the increases in inventory and accounts receivable of $25.3 million and $8.1 million,
respectively. In addition, we had an increase in other current and long term liabilities of $15.7
million, principally due to accrued tax liabilities.
18
Cash Flows from Investing Activities:
Cash used in investing activities consists primarily of capital expenditures and cash paid for
acquisitions. We had net cash outflows of $69.7 million for the six-months ended April 1, 2011,
compared to $35.3 million for the corresponding period in fiscal 2010. The increase is primarily
due to higher capital expenditures during the quarter.
Cash Flows from Financing Activities:
Cash used
in financing activities consists primarily of cash transactions related to debt and
equity. We had net cash outflows of $36.8 million for the six-months ended April 1, 2011.
Specifically, we had the following significant uses of cash:
|
|
|
$50.0 million related to the repayment and termination of the Credit Facility |
|
|
|
$41.6 million related to our repurchase of 1,518,045 shares of our common stock pursuant
to the share repurchase program approved by our Board of Directors on August 3, 2010 |
|
|
|
$18.8 million related to payroll tax withholdings on the vesting of employee performance
and restricted stock awards |
These uses of cash were partially offset by the net proceeds from employee stock option exercises
of $57.2 million, tax benefit from stock option exercises of $10.9 million and a decrease in
restricted cash of $5.5 million for the six-months ended April 1, 2011.
Liquidity:
Cash and cash equivalent balances increased to $504.5 million as of April 1, 2011 from $459.4
million at October 1, 2010. Our net cash position, after
deducting our debt, increased by $94.5
million to $479.1 million as of April 1, 2011 from $384.6 million at October 1, 2010. Based on our
historical results of operations, we expect our existing sources of liquidity, together with cash
expected to be generated from operations, will be sufficient to fund our research and development,
capital expenditures, debt obligations, working capital and other cash requirements for at least
the next 12 months. However, we cannot be certain that the capital required to fund these expenses
will be available in the future. In addition, any strategic investments and acquisitions that we
may make may require additional capital resources. If we are unable to obtain sufficient capital to
meet our capital needs on a timely basis and on favorable terms, our business and operations could
be materially adversely affected.
Our invested cash balances primarily consist of money market funds and repurchase agreements where
the underlying securities primarily consist of United States treasury obligations, United States
agency obligations, overnight repurchase agreements backed by United States treasuries and/or
United States agency obligations and highly rated commercial paper. Our invested cash balances also
include certificates of deposit. As of April 1, 2011, we also held a $3.2 million par value auction
rate security with a carrying value of $2.3 million. We continue to monitor the liquidity and
accounting classification of this security. If in a future period we determine that the impairment
is other than temporary, we will impair the security to its fair value and charge the loss to
earnings.
CONTRACTUAL OBLIGATIONS
Our contractual obligations disclosure in our annual report on Form 10-K for the year ended October
1, 2010 has not materially changed since we filed that report, with the exception that we paid off
and terminated the Credit Facility. Our borrowing arrangements are more fully described in Note 7
of the Notes to Consolidated Financial Statements contained in Item 1 in this Quarterly Report on
Form 10-Q.
OFF-BALANCE SHEET ARRANGEMENTS
We have no significant contractual obligations not fully recorded on our consolidated balance sheet
or fully disclosed in the notes to our consolidated financial statements. We have no material
off-balance sheet arrangements as defined in SEC Regulation S-K- 303(a)(4)(ii).
19
Item 3. Quantitative and Qualitative Disclosures about Market Risk
We are subject to foreign currency, investment, market and interest rate risks as described below:
Investment, Market and Interest Rate Risk
Our exposure to interest and market risk relates principally to our investment portfolio, which as
of April 1, 2011 consisted of the following (in millions):
|
|
|
|
|
Cash and cash equivalents (time deposits, overnight repurchase agreements and money market funds) |
|
$ |
503.8 |
|
Restricted cash (certificates of deposit) |
|
|
0.7 |
|
Available for sale securities (auction rate securities) |
|
|
2.3 |
|
|
|
|
|
Total |
|
$ |
506.8 |
|
|
|
|
|
The main objective of our investment activities is the liquidity and preservation of capital.
Credit risk associated with our investments is not significant as our investment policy prescribes
high credit quality standards and limits the amount of credit exposure to any one issuer. We do not
use derivative instruments for trading, speculative or investment purposes; however, we may use
derivatives in the future.
In general, our cash and cash equivalent investments have short-term maturity periods which dampen
the impact of significant market or interest rate risk. We are, however, subject to overall
financial market risks, such as changes in market liquidity, credit quality and interest rates.
Available for sale securities of $2.3 million carry a longer maturity period (contractual
maturities exceed ten years).
Our short-term debt at April 1, 2011 consists of $26.7 million aggregate principal amount of 2007
Convertible Notes. These 2007 Convertible Notes contain cash settlement provisions, which permit
the application of the treasury stock method in determining potential share dilution of the
conversion spread should the share price of the Companys common stock exceed $9.52. It has been
the Companys historical practice to cash settle the principal and interest components of
convertible debt instruments, and it is our intention to continue to do so in the future, including
settlement of the 2007 Convertible Notes due in March 2012.
We do not
believe that investment, market or interest rate risk are material to our business or
results of operations.
Exchange Rate Risk
Substantially all sales to customers and arrangements with third-party manufacturers provide for
pricing and payment in United States dollars, thereby reducing the impact of foreign exchange rate
fluctuations on our results. A small percentage of our international operational expenses are
denominated in foreign currencies. Exchange rate volatility could negatively or positively impact
those operating costs. Increases in the value of the United States dollar relative to other
currencies could make our products more expensive, which could negatively impact our ability to
compete. Conversely, decreases in the value of the United States dollar relative to other
currencies could result in our suppliers raising their prices to continue doing business with us.
Fluctuations in currency exchange rates could have a greater effect on our business in the future
to the extent our expenses increasingly become denominated in foreign currencies.
Item 4. Controls and Procedures
(a) Evaluation of disclosure controls and procedures.
Our management, with the participation of our chief executive officer and chief financial officer,
evaluated the effectiveness of our disclosure controls and procedures as of April 1, 2011. The term
disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the
Exchange Act, means controls and other procedures of a company that are designed to ensure that
information required to be disclosed by a company in the reports that it files or submits under the
Exchange Act is recorded, processed, summarized and reported, within the time periods specified in
the SECs rules and forms. Disclosure
20
controls and procedures include, without limitation, controls
and procedures designed to ensure that information required to be disclosed by a company in the
reports that it files or submits under the Exchange Act is accumulated and communicated to the
companys management, including its principal executive and principal financial officers, as
appropriate to allow timely decisions regarding required disclosure. Management recognizes that any
controls and procedures, no matter how well designed and operated, can provide only reasonable
assurance of achieving their objectives, and management necessarily applies its judgment in
evaluating the cost-benefit relationship of possible controls and procedures. Based on managements
evaluation of our disclosure controls and procedures as of April 1, 2011, our chief executive
officer and chief financial officer concluded that, as of such date, our disclosure controls and
procedures were effective at the reasonable assurance level.
(b) Changes in internal controls over financial reporting.
No changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and
15d-15(f) of the Exchange Act) occurred during the six-months ended April 1, 2011 that have
materially affected, or are reasonably likely to materially affect, the Companys internal control
over financial reporting.
PART II. OTHER INFORMATION
Item 1A. Risk Factors
There have been no significant changes in the risk factors disclosed in Item 1A of our Annual
Report on Form 10-K for the year ended October 1, 2010.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
The following table provides information regarding repurchases of common stock made by us during
the quarter ended April 1, 2011:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Maximum Number (or |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Approximately |
|
|
|
|
|
|
|
|
|
|
|
Total Number of |
|
|
Dollar Value) of |
|
|
|
|
|
|
|
|
|
|
|
Shares Purchased as |
|
|
Shares that May Yet |
|
|
|
|
|
|
|
|
|
|
|
Part of Publicly |
|
|
Be Purchased Under |
|
|
|
Total Number of |
|
|
Average Price Paid |
|
|
Announced Plans or |
|
|
the Plans or |
|
Period |
|
Shares Purchased |
|
|
per Share |
|
|
Programs (1) |
|
|
Programs |
|
01/01/11 01/28/11 |
|
|
5,221 |
(2) |
|
$ |
29.19 |
|
|
|
|
|
|
$181.8 million |
01/29/11 02/25/11 |
|
|
31,645 |
|
|
$ |
32.85 |
|
|
|
31,645 |
|
|
$180.8 million |
02/26/11 04/01/11 |
|
|
706,608 |
(2)(3) |
|
$ |
31.83 |
|
|
|
700,000 |
|
|
$158.5 million |
|
|
|
(1) |
|
On August 3, 2010 the Board of Directors approved a share repurchase program, pursuant to
which we are authorized to repurchase up to $200.0 million of our common
stock from time to time on the open market or in privately negotiated transactions as
permitted by securities laws and other legal requirements. The repurchase program is set to
expire on August 3, 2012; however, it may be suspended or discontinued at any time prior to
August 3, 2012. The repurchase program will be funded using our working capital. |
|
(2) |
|
Shares of common stock reported in the table above were
repurchased by us at the
fair market value of the common stock as of the period stated above, in connection with the
satisfaction of tax withholding obligations under restricted stock
agreements between us and certain of our employees. |
|
(3) |
|
700,000 shares were repurchased at an average of $31.86 as part of our share repurchase
program. 6,608 shares were repurchased with an average price of $29.34 per share in connection
with the satisfaction of tax withholding obligations under restricted stock agreements between
us and certain of our employees. |
21
Item 6. Exhibits
|
|
|
Number |
|
Description |
3.B*
|
|
Second Amended and Restated By-laws
of Skyworks Solutions, Inc., as amended on March 23, 2011 |
|
|
|
31.1*
|
|
Certification of the Companys Chief Executive Officer
pursuant to Securities Exchange Act of 1934, as amended, Rules
13a- 14(a) and 15d-14(a), as adopted pursuant to Section 302
of the Sarbanes-Oxley Act of 2002 |
|
|
|
31.2*
|
|
Certification of the Companys Chief Financial Officer
pursuant to Securities Exchange Act of 1934, as amended, Rules
13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of
the Sarbanes-Oxley Act of 2002 |
|
|
|
32.1*
|
|
Certification of the Companys Chief Executive Officer
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002 |
|
|
|
32.2*
|
|
Certification of the Companys Chief Financial Officer
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002 |
22
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
|
|
|
|
|
SKYWORKS SOLUTIONS, INC.
|
|
Date: May 11, 2011 |
By: |
/s/ David J. Aldrich
|
|
|
|
David J. Aldrich, President and Chief |
|
|
|
Executive Officer (Principal Executive Officer) |
|
|
|
|
|
|
By: |
/s/ Donald W. Palette
|
|
|
|
Donald W. Palette, Chief Financial Officer |
|
|
|
Vice President (Principal Accounting and Financial Officer) |
|
23
EXHIBIT INDEX
|
|
|
Number |
|
Description |
3.B
|
|
Second Amended and Restated By-laws
of Skyworks Solutions, Inc., as amended on March 23, 2011 |
|
|
|
31.1
|
|
Certification of the Companys Chief Executive Officer pursuant
to Securities Exchange Act of 1934, as amended, Rules 13a-
14(a) and 15d-14(a), as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002 |
|
|
|
31.2
|
|
Certification of the Companys Chief Financial Officer pursuant
to Securities Exchange Act of 1934, as amended, Rules 13a-14(a)
and 15d-14(a), as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002 |
|
|
|
32.1
|
|
Certification of the Companys Chief Executive Officer pursuant
to 18 U.S.C. Section 1350, as adopted pursuant to Section 906
of the Sarbanes-Oxley Act of 2002 |
|
|
|
32.2
|
|
Certification of the Companys Chief Financial Officer pursuant
to 18 U.S.C. Section 1350, as adopted pursuant to Section 906
of the Sarbanes-Oxley Act of 2002 |
24