XLNX
$70.05
Xilinx
$1.12
1.62%
Earnings Details
3rd Quarter December 2017
Wednesday, January 24, 2018 4:20:00 PM
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Summary

Xilinx Beats

Xilinx (XLNX) reported 3rd Quarter December 2017 earnings of $0.76 per share on revenue of $631.2 million. The consensus earnings estimate was $0.63 per share on revenue of $630.0 million. The Earnings Whisper number was $0.65 per share. Revenue grew 7.8% on a year-over-year basis.

The company said it expects fourth quarter revenue of $635.0 million to $665.0 million. The current consensus revenue estimate is $642.2 million for the quarter ending March 31, 2018.

Xilinx Inc designs, develops and markets programmable platforms, including integrated circuits, software design tools and predefined system functions delivered as intellectual property cores.

Results
Reported Earnings
$0.76
Earnings Whisper
$0.65
Consensus Estimate
$0.63
Reported Revenue
$631.2 Mil
Revenue Estimate
$630.0 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Xilinx Reports Record Revenues; Ninth Consecutive Quarter Of Revenue Growth

Xilinx, Inc. (XLNX) today announced record sales of $631 million for the third quarter of fiscal year 2018, up approximately 2% from the prior quarter and up 8% from the third quarter of the prior fiscal year. December quarter net income was $12 million, or $0.05 per diluted share. Due to the recent enactment of the Tax Cuts and Jobs Act, Xilinx incurred a tax expense of approximately $183 million in the December quarter.

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The Xilinx Board of Directors declared a quarterly cash dividend of $0.35 per outstanding share of common stock payable on February 22, 2018 to all stockholders of record at the close of business on February 7, 2018.

Additional December quarter comparisons are represented in the charts below:

GAAP Results
(In millions, except EPS)
Q3
Q2
Q3
Q-T-Q Y-T-Y
FY 2018 FY 2018 FY 2017
Net revenues
$631
$620
$586
2%
8%
Operating income
$190
$185
$163
2%
16%
Net income
$12
$168
$142
-93%
-92%
Diluted earnings per share $0.05
$0.65
$0.52
-92%
-90%

"We delivered our ninth consecutive quarter of revenue growth with December quarter revenues establishing a new record for Xilinx and we achieved our operating margin target of 30% one quarter ahead of schedule," said Moshe Gavrielov, Xilinx President and Chief Executive Officer. "Revenues from Advanced Products continued to be strong, increasing 30% from the same quarter a year ago and comprising 56% of company sales, supported by accelerated growth in our industry-leading 20nm and 16nm technology nodes. In addition, our 16nm portfolio continued to gain market momentum as we have cumulatively shipped 43 unique products to 1,160 customers."

Net Revenues by Geography:
Percentages
Growth Rates
Q3
Q2
Q3
Q-T-Q
Y-T-Y
FY 2018 FY 2018 FY 2017
North America 31%
31%
30%
3%
12%
Asia Pacific
41%
40%
43%
3%
3%
Europe
20%
20%
19%
2%
11%
Japan
8%
9%
8%
-8%
10%
Net Revenues by End Market:
Percentages
Growth Rates
Q3
Q2
Q3
Q-T-QY-T-Y
FY 2018 FY 2018 FY 2017
Communications & Data Center
35%
37%
44%
-2%
-12%
Industrial, Aerospace & Defense
47%
45%
41%
7%
23%
Broadcast, Consumer & Automotive 18%
18%
15%
-3%
24%
Net Revenues by Product:
Percentages
Growth Rates
Q3
Q2
Q3
Q-T-Q
Y-T-Y
FY 2018 FY 2018 FY 2017
Advanced Products 56%
52%
47%
10%
30%
Core Products
44%
48%
53%
-7%
-12%

Products are classified as follows:

Advanced Products: UltraScale+, Ultrascale and 7-series products. Core Products: Virtex-6, Spartan-6, Virtex-5, CoolRunner-II, Virtex-4, Virtex-II, Spartan-3, Spartan-2, XC9500 products, configuration solutions, software & support/services.

Key Statistics:
(Dollars in millions)
Q3
Q2
Q3
FY 2018 FY 2018 FY 2017
Annual Return on Equity (%)* 19
27
25
Operating Cash Flow
$185
$202
$106
Depreciation Expense
$11
$12
$11
Capital Expenditures
$7
$12
$20
Combined Inventory Days
121
116
114
Revenue Turns (%)
46
53
56
*Return on equity calculation: Annualized year to date net income/average stockholders’ equity

Product and Financial Highlights - December Quarter

The Advanced Products category continues to deliver strong revenue growth, posting an increase of 30% from the year ago quarter and constituting 56% of total sales. Broad-based growth was driven by the industry-leading 20nm and 16nm technology nodes. Revenues from the 20nm node grew significantly to a new record, increasing more than 70% from the same quarter year ago and the 16nm node continued its accelerated ramp with sales more than quadrupling during the same period, reflecting very broad-based customer adoption.

The Industrial, Aerospace & Defense end market set another quarterly record with revenues of $297 million, an increase of 23% from the same quarter a year ago, driven by significant strength in Semiconductor Test and Emulation Applications. Xilinx’s unrivaled technology leadership has been a significant driver for the record-setting revenue performance.

Xilinx achieved its operating margin target of 30%, one quarter ahead of schedule, while continuing investments in its technology leadership, share gains, and market expansion efforts for sustained revenue growth. Xilinx remains committed to returning cash to shareholders and during the first nine months of the fiscal year we have returned approximately 100% of our operating cash flow back to shareholders through a combination of dividends and share repurchases.

Xilinx continued to demonstrate strong customer momentum in its Cloud Computing market expansion opportunity. Market leader Alibaba recently announced plans for two generations of FPGA as a Service (FaaS) F2 and F3 using Virtex? Ultrascale +(TM) FPGAs. Additionally, Amazon Web Services expanded their FaaS F1 deployment to multiple regions, including availability in its secured government cloud.

Business Outlook - March Quarter Fiscal Year 2018

-- Sales are expected to be approximately $635 - $665 million.

-- Gross margin is expected to be 69% to 71%.

Operating expenses are expected to increase to approximately $285 million, including a one-time charge of approximately $30 million primarily related to the CEO transition.

-- Other income is expected to be approximately $3 million.

-- March quarter tax rate is expected to be approximately 0 - 5%.

Conference Call

A conference call will be held today at 2:00 p.m. Pacific Time to discuss the December quarter financial results and management’s outlook for the March quarter. The webcast and subsequent replay will be available in the investor relations section of the Company’s web site at www.investor.xilinx.com. A telephonic replay of the call may be accessed later in the day by calling (855) 859-2056 and referencing confirmation code 4886278. The telephonic replay will be available for two weeks following the live call.

This release contains forward-looking statements and projections. Forward-looking statements and projections can often be identified by the use of forward-looking words such as "expect," "believe," "may," "will," "could," "anticipate," "estimate," "continue," "plan," "intend," "project" or other similar expressions. Statements that refer to or are based on projections, uncertain events or assumptions also identify forward-looking statements. Such forward looking statements include, but are not limited to, statements related to the semiconductor market, the growth and acceptance of our products, expected revenue growth, the demand and growth in the markets we serve, opportunity for expansion into new markets, and our expectations regarding our business outlook for the March quarter of fiscal year 2018. Undue reliance should not be placed on such forward-looking statements and projections, which speak only as of the date they are made. We undertake no obligation to update such forward-looking statements. Actual events and results may differ materially from those in the forward-looking statements and are subject to risks and uncertainties including customer acceptance of our new products, current global economic conditions, the health of our customers and the end markets in which they participate, our ability to forecast end customer demand, a high dependence on turns business, more customer volume discounts than expected, greater product mix changes than anticipated, fluctuations in manufacturing yields, our ability to deliver product in a timely manner, our ability to successfully manage production at multiple foundries, variability in wafer pricing, costs and liabilities associated with current and future litigation, the impact of current and future legislative and regulatory changes, and other risk factors listed in our most recent Forms 10-Q and 10-K.

About Xilinx

Xilinx is the leading provider of All Programmable FPGAs, SoCs, MPSoCs, and 3D ICs. Xilinx uniquely enables applications that are both software defined and hardware optimized - powering industry advancements in Cloud Computing, Embedded Vision, Industrial IoT, and 5G Wireless. For more information, visit www.xilinx.com.

#1804F

Xilinx, the Xilinx logo, Artix, ISE, Kintex, Spartan, Virtex, Zynq, Vivado, and other designated brands included herein are trademarks of Xilinx in the United States and other countries. All other trademarks are the property of their respective owners.

XLNX-F

XILINX, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In thousands, except per share amounts)
Three Months Ended
Nine Months Ended
December 30, 2017
September 30, 2017
December 31, 2016
December 30, 2017
December 31, 2016
Net revenues
$
631,193
$
619,503
$
585,688
$
1,866,142
$
1,739,877
Cost of revenues
182,156
184,786
178,233
559,037
522,404
Gross margin
449,037
434,717
407,455
1,307,105
1,217,473
Operating expenses:
Research and development
166,231
157,985
159,248
477,267
437,187
Selling, general and administrative
92,753
91,053
83,780
272,981
250,353
Amortization of acquisition-related intangibles 353
510
1,455
1,568
3,943
Total operating expenses
259,337
249,548
244,483
751,816
691,483
Operating income
189,700
185,169
162,972
555,289
525,990
Interest and other income (expense), net
5,469
1,831
(392)
9,138
(6,130)
Income before income taxes
195,169
187,000
162,580
564,427
519,860
Provision for income taxes
183,224
19,468
20,734
217,705
50,773
Net income
$
11,945
$
167,532
$
141,846
$
346,722
$
469,087
Net income per common share:
Basic
$
0.05
$
0.68
$
0.57
$
1.39
$
1.86
Diluted
$
0.05
$
0.65
$
0.52
$
1.34
$
1.74
Cash dividends per common share
$
0.35
$
0.35
$
0.33
$
1.05
$
0.99
Shares used in per share calculations:
Basic
254,089
248,094
250,982
248,671
252,811
Diluted
258,108
258,217
270,781
258,995
269,182
XILINX, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
December 30, 2017
April 1, 2017*
(unaudited)
ASSETS
Current assets:
Cash, cash equivalents and short-term investments $
3,541,576
$
3,321,457
Accounts receivable, net
352,849
243,915
Inventories
226,533
227,033
Other current assets
76,925
87,711
Total current assets
4,197,883
3,880,116
Net property, plant and equipment
303,984
303,825
Long-term investments
102,375
116,288
Other assets
515,377
440,303
Total Assets
$
5,119,619
$
4,740,532
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued liabilities
$
429,421
$
386,301
Deferred income on shipments to distributors
32,974
54,567
Current portion of long-term debt
--
456,328
Total current liabilities
462,395
897,196
Long-term debt
1,730,211
995,247
Deferred tax liabilities
110
317,639
Long-term income taxes payable
531,522
4,503
Other long-term liabilities
30,747
16,908
Temporary equity
--
1,406
Stockholders’ equity
2,364,634
2,507,633
Total Liabilities and Stockholders’ Equity
$
5,119,619
$
4,740,532
* Derived from audited financial statements
XILINX, INC.
SUPPLEMENTAL FINANCIAL INFORMATION
(Unaudited)
(In thousands)
Three Months Ended
Nine Months Ended
December 30, 2017
September 30, 2017
December 31, 2016
December 30, 2017
December 31, 2016
SELECTED CASH FLOW INFORMATION:
Depreciation
$
11,452
$
11,732
$
11,110
$
34,416
$
33,917
Amortization
5,458
3,432
4,887
12,619
12,601
Stock-based compensation
36,801
36,372
30,867
105,209
90,073
Net cash provided by operating activities
184,686
202,140
105,584
577,734
627,813
Purchases of property, plant and equipment
6,791
12,223
19,875
28,940
51,825
Payment of dividends to stockholders
89,491
86,957
83,256
263,751
250,733
Repurchases of common stock
73,290
170,454
213,844
310,806
413,983
Net proceeds (withholding) from issuance of
common stock to employees
(2,131)
(23,765)
1,195
(24,826)
10,708
STOCK-BASED COMPENSATION INCLUDED IN:
Cost of revenues
$
2,188
$
2,147
$
1,945
$
6,486
$
5,994
Research and development
20,217
20,096
17,154
57,779
48,803
Selling, general and administrative
14,396
14,129
11,768
40,944
35,276

Investor Relations Contact: Suresh Bhaskaran Xilinx, Inc.(408) 879-4784ir@xilinx.com

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