SANTA CLARA, Calif.,
Nov. 17, 2016 /PRNewswire/
-- Marvell Technology Group Ltd. (NASDAQ: MRVL), a leader in
storage, networking, and connectivity semiconductor solutions,
today reported financial results for the third quarter of fiscal
2017, ended October 29, 2016.
Revenues for the third quarter of fiscal 2017 were
$654 million which exceeded the
Company's guidance provided on September 6,
2016.
GAAP net income for the third quarter of fiscal 2017 was
$73 million, or $0.14 per share (diluted). Non-GAAP net income
for the third quarter of fiscal 2017 was $105 million, or $0.20 per share (diluted). Cash flow from
operations for the quarter was $121
million.
"Marvell delivered strong financial performance in Q3," said
Matt Murphy, President and Chief
Executive Officer. "Our core businesses performed very well, with
data storage and network infrastructure growing double digits
year-over-year. I'm very pleased with the performance of our
team."
Fourth Quarter of Fiscal 2017 Financial Outlook
On
November 2, 2016, Marvell announced
restructuring actions to drive growth and improve profitability.
These actions are expected to be fully implemented by the end
of October 2017 and are expected to lower annual
operating expenses from a current annualized run rate of $1.08
billion to the $820-840 million range. As a
result of these actions, the Company expects to incur charges
of $90 million to $110
million over the next four quarters, including cash charges
of $35 million to $50 million.
Restructuring and restructuring-related charges include an estimate
of severance, asset impairment, lease termination fees, and other
costs. We expect to incur a portion of these charges in the
fourth quarter of fiscal 2017.
Marvell's fourth quarter of fiscal 2017 financial outlook also
excludes the estimated results of certain non-strategic businesses
that have a first half of fiscal 2017 annualized run rate of
approximately $100 million in revenue
and $60 million in operating
expenses. These businesses will be classified as discontinued
operations beginning in the fourth quarter of fiscal 2017. In
addition, Marvell's financial outlook does not include the
potential impact of certain items such as share repurchases,
acquisitions or divestitures, or further restructuring activities
that may be completed after November 16,
2016.
- Revenue is expected to be $565
million plus or minus 2%, excluding discontinued operations
and reflecting normal seasonality.
- GAAP and Non-GAAP Gross Margins are expected to be in the range
of 57% to 58%.
- GAAP Operating Expenses are expected to be $322 million to $332 million, which includes part
of the restructuring charges announced on November 2, 2016.
- Non-GAAP Operating Expenses are expected to be $225 million to $235 million.
- GAAP Diluted EPS from continuing operations are expected to be
in the range of ($0.01) to
$0.03.
- Non-GAAP Diluted EPS from continuing operations are expected to
be in the range of $0.17 to
$0.21.
Conference Call
Marvell will conduct a conference call
on Thursday, November 17, 2016 at
1:45 p.m. Pacific Time to discuss
results for the third quarter of fiscal 2017. Interested parties
may join the conference call by dialing 1-844-647-5488 or
1-615-247-0258, pass-code 11983150. The call will be webcast
by Thomson Reuters and can be accessed at the Marvell Investor
Relations website at http://investor.marvell.com/ with a replay
available following the call until December
17, 2016.
Discussion of Non-GAAP Financial Measures
Non-GAAP
financial measures exclude the effect of share-based compensation
expense, amortization and write-off of acquired intangible assets,
acquisition-related costs, restructuring and other related
charges, litigation settlement, and certain expenses and benefits
that are driven primarily by discrete events that management does
not consider to be directly related to Marvell's core operating
performance. Non-GAAP diluted net income per share is calculated by
dividing Non-GAAP net income by Non-GAAP weighted average shares
outstanding (diluted). For purposes of calculating Non-GAAP
diluted net income per share, the GAAP weighted average shares
outstanding (diluted) is adjusted to exclude the potential benefits
of share-based compensation expected to be incurred in future
periods but not yet recognized in the financial statements. The
expected compensation costs are treated as additional proceeds
assumed to be used to repurchase shares under the GAAP treasury
stock method.
Marvell believes that the presentation of Non-GAAP financial
measures provides important supplemental information to management
and investors regarding financial and business trends relating to
Marvell's financial condition and results of operations. While
Marvell uses Non-GAAP financial measures as a tool to enhance its
understanding of certain aspects of its financial performance,
Marvell does not consider these measures to be a substitute for, or
superior to, financial measures calculated in accordance with GAAP.
Consistent with this approach, Marvell believes that disclosing
Non-GAAP financial measures to the readers of its financial
statements provides such readers with useful supplemental data
that, while not a substitute for GAAP financial measures, allows
for greater transparency in the review of its financial and
operational performance.
Externally, management believes that investors may find
Marvell's Non-GAAP financial measures useful in their assessment of
Marvell's operating performance and the valuation of Marvell.
Internally, Marvell's Non-GAAP financial measures are used in the
following areas:
- Management's evaluation of Marvell's operating
performance;
- Management's establishment of internal operating budgets;
- Management's performance comparisons with internal forecasts
and targeted business models; and
- Management's determination of the achievement and measurement
of certain performance-based equity awards (adjustments may vary
from award to award).
Non-GAAP financial measures have limitations in that they do not
reflect all of the costs associated with the operations of
Marvell's business as determined in accordance with GAAP. As a
result, you should not consider these measures in isolation or as a
substitute for analysis of Marvell's results as reported under
GAAP. Marvell expects to continue to incur expenses similar to the
Non-GAAP adjustments described above, and exclusion of these items
from Marvell's Non-GAAP net income should not be construed as an
inference that these costs are unusual, infrequent or
non-recurring.
Forward-Looking Statements under the Private Securities
Litigation Reform Act of 1995
This press release contains
forward-looking statements within the meaning of the federal
securities laws that involve risks and uncertainties, including:
Marvell's expectations regarding its fourth quarter of fiscal 2017
financial outlook; and Marvell's use of Non-GAAP financial measures
as important supplemental information. Words such as "anticipates,"
"expects," "intends," "plans," "projects," "believes," "seeks,"
"estimates," "can," "may," "will," "would" and similar expressions
identify such forward-looking statements. These statements
are not guarantees of results and should not be considered as an
indication of future activity or future performance. Actual events
or results may differ materially from those described in this press
release due to a number of risks and uncertainties, including, but
not limited to: adverse impacts of litigation or regulatory
activities; Marvell's ability to implement its restructuring in a
timely manner; the amount and timing of anticipated charges
associated with the restructuring; Marvell's ability to increase
its operational efficiency and decrease its operating expenses to
the anticipated level; its ability to divest certain non-strategic
businesses within the anticipated timeframes and with the
anticipated cost savings; actions that may be taken by Marvell as a
result of the Audit Committee's investigation; adverse impacts of
litigation or regulatory activities; Marvell's ability to compete
in products and prices in an intensely competitive industry;
Marvell's reliance on the hard disk drive and wireless markets,
which are highly cyclical and intensely competitive; costs and
liabilities relating to current and future litigation; Marvell's
reliance on a few customers for a significant portion of its
revenue; Marvell's ability to develop and introduce new and
enhanced products in a timely and cost effective manner and the
adoption of those products in the market; seasonality in sales of
consumer devices in which Marvell's products are incorporated;
uncertainty in the worldwide economic conditions; risks associated
with manufacturing and selling a majority of Marvell's products and
Marvell's customers' products outside of the United States; and other risks detailed in
Marvell's SEC filings from time to time. For other factors that
could cause Marvell's results to vary from expectations, please see
the risk factors identified in Marvell's Quarterly Report on Form
10-Q for the fiscal quarter ended July 30,
2016 as filed with the SEC on September 8, 2016, and other factors detailed
from time to time in Marvell's filings with the SEC. Marvell
undertakes no obligation to revise or update publicly any
forward-looking statements.
About Marvell
Marvell first revolutionized the
digital storage industry by moving information at speeds never
thought possible. Today, that same breakthrough innovation remains
at the heart of the company's storage, network infrastructure, and
wireless connectivity solutions. With leading intellectual property
and deep system-level knowledge, Marvell's semiconductor solutions
continue to transform the enterprise, cloud, automotive,
industrial, and consumer markets. To learn more, visit:
www.marvell.com
Marvell® and the Marvell logo are registered trademarks of
Marvell and/or its affiliates.
Marvell Technology
Group Ltd.
|
Condensed
Consolidated Statements of Operations
|
(Unaudited)
|
(In thousands,
except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
|
|
|
|
October
29,
|
|
July
30,
|
|
October
31,
|
|
October
29,
|
|
October
31,
|
|
|
|
|
|
|
2016
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
revenue
|
|
|
|
$
654,422
|
|
$ 626,404
|
|
$
674,890
|
|
$
1,821,648
|
|
$
2,109,670
|
Cost of goods
sold
|
|
|
286,063
|
|
287,608
|
|
379,254
|
|
832,881
|
|
1,192,126
|
Gross
profit
|
|
|
|
368,359
|
|
338,796
|
|
295,636
|
|
988,767
|
|
917,544
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development
|
|
223,519
|
|
228,562
|
|
284,308
|
|
693,352
|
|
861,743
|
|
Selling and
marketing
|
|
|
30,576
|
|
31,094
|
|
32,481
|
|
93,049
|
|
99,496
|
|
General and
administrative
|
|
29,012
|
|
37,173
|
|
34,771
|
|
101,808
|
|
767,028
|
|
Amortization and
write-off of acquired intangible assets
|
2,299
|
|
2,461
|
|
3,150
|
|
7,221
|
|
8,286
|
|
|
Total operating
expenses
|
|
285,406
|
|
299,290
|
|
354,710
|
|
895,430
|
|
1,736,553
|
Operating income
(loss)
|
|
|
82,953
|
|
39,506
|
|
(59,074)
|
|
93,337
|
|
(819,009)
|
Interest and other
income, net
|
|
5,470
|
|
6,284
|
|
4,644
|
|
13,242
|
|
16,601
|
Income (loss) before
income taxes
|
|
88,423
|
|
45,790
|
|
(54,430)
|
|
106,579
|
|
(802,408)
|
Provision (benefit)
for income taxes
|
|
15,807
|
|
(5,515)
|
|
3,320
|
|
5,337
|
|
13,192
|
Net income
(loss)
|
|
|
$
72,616
|
|
$
51,305
|
|
$
(57,750)
|
|
$
101,242
|
|
$
(815,600)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net income
(loss) per share
|
|
$
0.14
|
|
$
0.10
|
|
$
(0.11)
|
|
$
0.20
|
|
$
(1.59)
|
Diluted net income
(loss) per share
|
|
$
0.14
|
|
$
0.10
|
|
$
(0.11)
|
|
$
0.20
|
|
$
(1.59)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in
computing basic earnings (loss) per share
|
511,090
|
|
511,235
|
|
504,831
|
|
510,373
|
|
512,476
|
Shares used in
computing diluted earnings (loss) per share
|
522,091
|
|
514,314
|
|
504,831
|
|
516,476
|
|
512,476
|
Marvell Technology
Group Ltd.
|
Condensed
Consolidated Balance Sheets
|
(Unaudited)
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
October
29,
|
|
January
30,
|
Assets
|
|
|
|
|
|
2016
|
|
2016
|
Current
assets:
|
|
|
|
|
|
|
|
|
|
Cash, cash
equivalents and short-term investments
|
|
$
1,650,372
|
|
$
2,282,749
|
|
Accounts receivable,
net
|
|
|
|
362,195
|
|
323,300
|
|
Inventories
|
|
|
|
|
|
198,843
|
|
210,017
|
|
Prepaid expenses and
other current assets
|
|
49,731
|
|
102,560
|
|
|
Total current
assets
|
|
|
|
2,261,141
|
|
2,918,626
|
Property and
equipment, net
|
|
|
|
265,984
|
|
299,540
|
Long-term
investments
|
|
|
|
|
8,974
|
|
11,296
|
Goodwill and acquired
intangible assets, net
|
|
|
2,039,279
|
|
2,047,955
|
Other non-current
assets
|
|
|
|
179,068
|
|
164,710
|
|
|
Total
assets
|
|
|
|
|
$
4,754,446
|
|
$
5,442,127
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Shareholders' Equity
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
Accounts
payable
|
|
|
|
|
$
183,252
|
|
$
180,372
|
|
Accrued
liabilities
|
|
|
|
|
256,339
|
|
253,691
|
|
Carnegie Mellon
University accrued litigation settlement
|
-
|
|
736,000
|
|
Deferred
income
|
|
|
|
|
63,656
|
|
55,722
|
|
|
Total current
liabilities
|
|
|
|
503,247
|
|
1,225,785
|
Other non-current
liabilities
|
|
|
|
70,705
|
|
76,219
|
|
|
Total
liabilities
|
|
|
|
|
573,952
|
|
1,302,004
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
|
|
|
|
Common
stock
|
|
|
|
|
1,017
|
|
1,015
|
|
Additional paid-in
capital
|
|
|
|
3,057,535
|
|
3,028,921
|
|
Accumulated other
comprehensive income
|
|
1,553
|
|
(795)
|
|
Retained
earnings
|
|
|
|
|
1,120,389
|
|
1,110,982
|
|
|
Total shareholders'
equity
|
|
|
4,180,494
|
|
4,140,123
|
|
|
Total liabilities and
shareholders' equity
|
|
$
4,754,446
|
|
$
5,442,127
|
Marvell Technology
Group Ltd.
|
Condensed
Consolidated Statements of Cash Flows
|
(Unaudited)
|
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
Nine Months
Ended
|
|
|
|
|
|
|
|
|
October
29,
|
|
October
31,
|
|
|
October
29,
|
|
October
31,
|
|
|
|
|
|
|
|
|
2016
|
|
2015
|
|
|
2016
|
|
2015
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
|
|
|
$
72,616
|
|
$
(57,750)
|
|
|
$
101,242
|
|
$
(815,600)
|
Adjustments to
reconcile net income (loss) to net cash provided
|
|
|
|
|
|
|
|
|
|
by operating
activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
|
27,188
|
|
25,565
|
|
|
81,168
|
|
77,376
|
|
Share-based
compensation
|
|
|
|
|
28,263
|
|
31,465
|
|
|
89,912
|
|
101,360
|
|
Amortization and
write-off of acquired intangible assets
|
|
2,784
|
|
3,635
|
|
|
8,676
|
|
9,741
|
|
Non-cash
restructuring and other related charges
|
|
|
1,056
|
|
14,270
|
|
|
2,081
|
|
15,743
|
|
Other non-cash
expense (income), net
|
|
|
|
(930)
|
|
4,205
|
|
|
1,020
|
|
5,926
|
|
Excess tax benefits
from share-based compensation
|
|
|
(5)
|
|
(2)
|
|
|
(10)
|
|
(27)
|
|
Changes in assets and
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
|
|
|
(13,512)
|
|
36,793
|
|
|
(38,895)
|
|
40,027
|
|
|
Inventories
|
|
|
|
|
3,710
|
|
39,457
|
|
|
10,944
|
|
21,042
|
|
|
Prepaid expenses and
other assets(a)
|
|
|
6,457
|
|
6,804
|
|
|
(2,578)
|
|
18,132
|
|
|
Accounts
payable
|
|
|
|
|
(29,818)
|
|
(55,693)
|
|
|
10,541
|
|
(43,735)
|
|
|
Accrued liabilities
and other non-current liabilities (a)
|
|
6,508
|
|
5,116
|
|
|
(759,735)
|
|
746,731
|
|
|
Accrued employee
compensation
|
|
|
|
25,537
|
|
14,295
|
|
|
10,419
|
|
(14,636)
|
|
|
Deferred
income
|
|
|
|
|
(8,393)
|
|
(1,566)
|
|
|
7,934
|
|
(10,034)
|
|
|
|
Net cash provided by
(used in) operating activities
|
|
121,461
|
|
66,594
|
|
|
(477,281)
|
|
152,046
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchases of
available-for-sale securities
|
|
|
(140,087)
|
|
(356,465)
|
|
|
(343,810)
|
|
(922,830)
|
|
Sales and maturities
of available-for-sale securities
|
|
|
170,472
|
|
356,409
|
|
|
657,037
|
|
826,199
|
|
Purchase of time
deposits
|
|
|
|
|
(75,000)
|
|
-
|
|
|
(200,000)
|
|
-
|
|
Maturities of time deposits
|
|
|
|
|
50,000
|
|
-
|
|
|
50,000
|
|
-
|
|
Distribution from
(investments in) privately-held companies
|
|
274
|
|
(130)
|
|
|
274
|
|
78
|
|
Purchases of
technology licenses
|
|
|
|
(394)
|
|
(980)
|
|
|
(8,439)
|
|
(6,657)
|
|
Purchases of property
and equipment
|
|
|
|
(13,347)
|
|
(9,041)
|
|
|
(37,724)
|
|
(33,361)
|
|
Purchase of equipment
previously leased
|
|
|
-
|
|
-
|
|
|
-
|
|
(10,240)
|
|
Net proceeds from
sale of equipment held for sale
|
|
|
-
|
|
10,007
|
|
|
-
|
|
10,007
|
|
|
|
Net cash provided by
(used in) investing activities
|
|
|
|
|
(8,082)
|
|
(200)
|
|
|
117,338
|
|
(136,804)
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Repurchase of common
stock (b)
|
|
|
|
(56,531)
|
|
(65,291)
|
|
|
(56,531)
|
|
(260,875)
|
|
Proceeds from
employee stock plans
|
|
|
|
11,277
|
|
2,174
|
|
|
11,836
|
|
59,348
|
|
Minimum tax
withholding paid on behalf of employees
|
|
|
|
|
|
|
|
|
|
|
for net share
settlement
|
|
|
|
|
(899)
|
|
(869)
|
|
|
(16,281)
|
|
(23,876)
|
|
Dividend payments to
shareholders
|
|
|
|
|
(30,699)
|
|
(30,270)
|
|
|
(91,835)
|
|
(92,374)
|
|
Payments on
technology license obligations
|
|
|
|
|
(3,696)
|
|
(2,617)
|
|
|
(13,848)
|
|
(11,416)
|
|
Excess tax benefits
from share-based compensation
|
|
|
5
|
|
2
|
|
|
10
|
|
27
|
|
|
|
Net cash used in
financing activities
|
|
|
(80,543)
|
|
(96,871)
|
|
|
(166,649)
|
|
(329,166)
|
Net increase
(decrease) in cash and cash equivalents
|
|
|
32,836
|
|
(30,477)
|
|
|
(526,592)
|
|
(313,924)
|
Cash and cash
equivalents at beginning of period
|
|
|
718,752
|
|
927,530
|
|
|
1,278,180
|
|
1,210,977
|
Cash and cash
equivalents at end of period
|
|
|
$
751,588
|
|
$
897,053
|
|
|
$
751,588
|
|
$
897,053
|
|
|
(a)
|
In the nine months
ended October 29, 2016, the Company paid a total of $750.0 million
to CMU in connection with the settlement agreement that was reached
in February 2016. Of this settlement, the Company recognized a
charge of $736.0 million in fiscal 2016. The remaining $14.0
million was recorded in prepaid expenses and other assets, to be
recognized in cost of goods sold over the remaining term of the
license from February 2016 through April 2018. For further detail
of the accounting for the settlement, see "Note 13 – Carnegie
Mellon University Settlement" in the Notes to the Unaudited
Condensed Consolidated Financial Statements included in the
Company's Quarterly Report on Form 10-Q for the quarter ended July
30, 2016.
|
|
|
(b)
|
Marvell records all
repurchases of common stock consistent with the way it records
investment purchases and sales, based on trade date in accordance
with U.S. GAAP.
|
Marvell Technology
Group Ltd.
|
Reconciliations
from GAAP to Non-GAAP
|
(Unaudited)
|
(In thousands,
except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
Nine Months
Ended
|
|
|
|
|
|
|
October
29,
|
|
July
30,
|
|
October
31,
|
|
October
29,
|
|
October
31,
|
|
|
|
|
|
|
2016
|
|
2016(e)
|
|
2015
|
|
2016
|
|
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP gross
profit:
|
|
|
|
$
368,359
|
|
$ 338,796
|
|
$
295,636
|
|
$
988,767
|
|
$
917,544
|
Special
items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share-based
compensation
|
|
|
2,225
|
|
2,832
|
|
2,495
|
|
6,859
|
|
6,054
|
|
Restructuring and
other related charges (a)
|
|
|
|
|
-
|
|
-
|
|
10,285
|
|
-
|
|
10,285
|
|
Amortization of
acquired intangible assets
|
|
|
|
|
485
|
|
485
|
|
485
|
|
1,455
|
|
2,188
|
|
Other cost of good
sold (b)
|
|
|
-
|
|
-
|
|
1,158
|
|
-
|
|
80,848
|
Total special
items
|
|
|
|
2,710
|
|
3,317
|
|
14,423
|
|
8,314
|
|
99,375
|
Non-GAAP gross
profit
|
|
|
$
371,069
|
|
$ 342,113
|
|
$
310,059
|
|
$
997,081
|
|
$
1,016,919
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP gross
margin
|
|
|
|
56.3%
|
|
54.1%
|
|
43.8%
|
|
54.3%
|
|
43.5%
|
Non-GAAP gross
margin
|
|
|
56.7%
|
|
54.6%
|
|
45.9%
|
|
54.7%
|
|
48.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total GAAP operating
expenses
|
|
|
$
285,406
|
|
$ 299,290
|
|
$
354,710
|
|
$
895,430
|
|
$
1,736,553
|
Special
items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share-based
compensation
|
|
|
(26,038)
|
|
(34,364)
|
|
(28,970)
|
|
(83,053)
|
|
(95,306)
|
|
Restructuring and
other related charges (a)
|
|
|
(1,164)
|
|
(721)
|
|
(35,270)
|
|
(6,326)
|
|
(48,862)
|
|
Amortization of and
write-off acquired intangible assets
|
|
(2,299)
|
|
(2,461)
|
|
(3,150)
|
|
(7,221)
|
|
(8,286)
|
|
Other operating
expenses (c)
|
|
|
-
|
|
12
|
|
(3,834)
|
|
(1,229)
|
|
(691,745)
|
Total special
items
|
|
|
|
(29,501)
|
|
(37,534)
|
|
(71,224)
|
|
(97,829)
|
|
(844,199)
|
Total non-GAAP
operating expenses
|
|
|
$
255,905
|
|
$ 261,756
|
|
$
283,486
|
|
$
797,601
|
|
$
892,354
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income
(loss)
|
|
|
$
72,616
|
|
$
51,305
|
|
$
(57,750)
|
|
$
101,242
|
|
$
(815,600)
|
Special
items:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share-based
compensation
|
|
|
28,263
|
|
37,196
|
|
31,465
|
|
89,912
|
|
101,360
|
|
Restructuring and
other related charges (a)
|
|
|
1,164
|
|
721
|
|
45,555
|
|
6,326
|
|
59,147
|
|
Amortization of and
write-off acquired intangible assets
|
|
2,784
|
|
2,946
|
|
3,635
|
|
8,676
|
|
10,474
|
|
Other operating
expenses (c)
|
|
|
-
|
|
(12)
|
|
4,992
|
|
1,229
|
|
772,593
|
Pre-tax total special
items
|
|
|
32,211
|
|
40,851
|
|
85,647
|
|
106,143
|
|
943,574
|
Non-GAAP income
before income taxes
|
|
|
104,827
|
|
92,156
|
|
27,897
|
|
207,385
|
|
127,974
|
Tax effect of special
items (d)
|
|
|
-
|
|
-
|
|
1,108
|
|
(1,071)
|
|
11,511
|
Non-GAAP net
income
|
|
|
$
104,827
|
|
$
92,156
|
|
$
29,005
|
|
$
206,314
|
|
$
139,485
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares - basic
|
|
|
511,090
|
|
511,235
|
|
504,831
|
|
510,373
|
|
512,476
|
Weighted average
shares - diluted
|
|
|
522,091
|
|
514,314
|
|
504,831
|
|
516,476
|
|
512,476
|
Non-GAAP weighted
average shares - diluted
|
|
|
531,831
|
|
526,453
|
|
518,505
|
|
526,883
|
|
528,869
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP diluted net
income per share
|
|
|
|
|
$
0.14
|
|
$
0.10
|
|
$
(0.11)
|
|
$
0.20
|
|
$
(1.59)
|
Non-GAAP diluted net
income per share
|
|
|
|
|
$
0.20
|
|
$
0.18
|
|
$
0.06
|
|
$
0.39
|
|
$
0.26
|
|
|
(a)
|
Restructuring and
other related charges include costs that qualify under U.S. GAAP as
restructuring costs and other incremental charges that are a direct
result of restructuring. Examples of other incremental charges
include impairment of equipment specifically identified as part of
the restructuring action and the write down of
inventories.
|
|
|
(b)
|
Other COGS include
charges recognized for pending and settled litigation proceedings
in three and nine months ended October 31, 2015.
|
|
|
(c)
|
Other operating
expenses include charges recognized for pending and settled
litigation proceedings of $747.6 million ($666.7 million of which
was reported in operating expenses) in the nine months ended
October 31, 2015. Other operating expenses for the nine months
ended October 29, 2016, and the three and nine months ended October
31, 2015 also include costs of $0.9 million, $2.9 million and $8.5
million, respectively, for the surety bonds related to the
litigation with CMU that was settled in February 2016. Other
operating expenses for the nine months ended October 29, 2016, and
the three and nine months ended October 31, 2015 also include
expenses of $0.3 million, $1.0 million and $1.1 million,
respectively, related to retention bonuses offered to employees
expected to remain through the ramp down of certain operations
related to the mobile business, as well as the closure of certain
design center operations in Europe. In addition, other operating
expenses for the nine months ended October 31, 2015 include a
charge for the payment of $15.4 million due to our former Chief
Executive Officer (see "Note 14 – Related Party Transactions" in
the Notes to the Consolidated Financial Statements set forth in the
Company's Annual Report on Form 10-K for fiscal
2016).
|
|
|
(d)
|
Tax effect of special
items includes the related tax effect of the payment to our former
Chief Executive Officer in the nine months ended October 29, 2016
and October 31, 2015. Tax effect of special items also includes the
tax effect of certain restructuring charges in three and nine
months ended October 31, 2015.
|
For further information, contact:
John Spencer Ahn
Investor Relations
408-222-7544
johnahn@marvell.com
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SOURCE Marvell Technology Group Ltd.