[February 13, 2018] |
|
Lattice Semiconductor Reports Fourth Quarter and Full Year 2017 Results
Lattice Semiconductor Corporation (NASDAQ: LSCC), the leading provider
of customizable smart connectivity solutions, announced financial
results today for the fiscal fourth quarter and full year ended December
31, 2017.
The Company reported revenue for the fourth quarter of 2017 of $95.3
million, which increased 3.6% sequentially, as compared to the third
quarter 2017 revenue of $92.0 million, and decreased 19.3% as compared
to the fourth quarter 2016 revenue of $118.1 million.
Gross margin on a GAAP basis was 53.8% for the fourth quarter of 2017,
as compared to the third quarter of 2017 gross margin of 58.0% and 53.7%
for the fourth quarter of 2016. Gross margin in the fourth quarter of
2017 declined compared to the third quarter of 2017 largely as the
result of a reduction in the Company's inventory valuation of lower
wafer and overhead costs. On a non-GAAP basis, gross margin for the
fourth quarter of 2017 was 54.0%, as compared to 58.1% for the third
quarter of 2017 and 53.9% for the fourth quarter of 2016.
Total operating expenses for the fourth quarter of 2017 were $51.9
million on a GAAP basis, including an intangible asset impairment credit
of $3.8 million, as compared to $90.8 million for the third quarter of
2017, including an intangible asset impairment charge of $36.2 million
and the gain on sale of a building of $4.6 million, and $64.4 million
for the fourth quarter of 2016, including $6.2 million in acquisition
related expenses. On a non-GAAP basis, total operating expenses were
$44.1 million for the fourth quarter of 2017, as compared to $44.6
million for the third quarter of 2017, and $45.1 million for the fourth
quarter of 2016.
GAAP net loss for the fourth quarter of 2017 was $7.2 million ($0.06 per
basic and diluted share), as compared to a net loss on a GAAP basis in
the prior quarter of $43.1 million ($0.35 per basic and diluted share),
and a net loss on a GAAP basis in the year ago period of $8.2 million
($0.07 per basic and diluted share). Non-GAAP net income for the fourth
quarter of 2017 was $1.0 million ($0.01 per basic and diluted share), as
compared to $5.3 million ($0.04 per basic and diluted share) in the
prior quarter, and $11.8 million ($0.10 per basic and diluted share) in
the year ago period. For a reconciliation of U.S. GAAP to Non-GAAP
please see the table titled, "Reconciliation of U.S. GAAP to Non-GAAP
Financial Measures" provided as part of this press release.
For the fiscal year 2017, revenue was $386.0 million, a decrease of 9.6%
from $427.1 million in the fiscal year 2016. Revenue growth from the
Computing, Industrial and Automotive end markets was offset by a
non-recurrence of product demand related to the tin-lead and line item
reduction program in 2016, a delay in the HDMI royalty sharing
agreement, and year-over-year declines in DTV demand. Net loss on a GAAP
basis for fiscal year 2017 was $70.6 million ($0.58 per basic and
diluted share), compared to a net loss of $54.1 million ($0.45 per basic
and diluted share) reported in fiscal year 2016. Total operating
expenses for the fiscal year 2017 were $264.2 million on a GAAP basis,
including a net intangible asset impairment charge of $32.4 million, as
compared to $273.1 million for the fiscal year 2016, including
intangible asset impairment of $7.9 million. On a non-GAAP basis, total
operating expenses were $182.3 million for the fiscal year 2017, as
compared to $200.8 million for the fiscal year 2016. On a non-GAAP
Basis, net income for the fiscal year 2017 was $13.6 million ($0.11 per
basic and diluted share), compared to net income of $17.0 million ($0.14
per basic and diluted share) for the fiscal year 2016. For a
reconciliation of U.S. GAAP to Non-GAAP please see the table titled,
"Reconciliation of U.S. GAAP to Non-GAAP Financial Measures" provided as
part of this press release.
Darin G. Billerbeck, President and Chief Executive Officer, said, "Our
results for the fourth quarter of 2017 were in-line with expectations as
we both grew revenue and reduced our spending. At no time in history
have we had a more extensive portfolio of products that align with key
customer requirements such as low power and cost, small form factor, and
overall performance. We are in a fundamentally stronger position today
as we continue to execute on our primary goals - driving a return to
revenue growth, further reducing operating expenses, increasing free
cash flow, along with paying down corporate debt."
Max Downing, Chief Financial Officer, added, "Results in the fourth
quarter of 2017 were led by our continued growth in the industrial and
automotive end market, which increased to 41% of revenue in the quarter
compared to 37% in the prior quarter and 31% in the year ago fourth
quarter. Our operating expenses were in-line with guidance on a non-GAAP
basis but do not yet fully reflect the benefits of the aggressive
actions we have already taken. Our long-term target model is to achieve
operating expenses on a non-GAAP basis at 35% of revenue, which we
expect to reach in the second half of 2018. We ended the fourth quarter
of 2017 with approximately $112 million in cash and short-term
investments, giving us the continued balance sheet strength needed to
pay down our corporate debt and to capture additional high potential
growth opportunities in front of us."
Business Outlook - First Quarter 2018*:
-
Revenue for the first quarter of 2018 is expected to be between
approximately $95 million and $100 million.
-
Gross margin percentage for the first quarter of 2018 is expected to
be approximately 56% plus or minus 2% on both a GAAP and non-GAAP
basis.
-
Total operating expenses are expected to be between approximately
$52.7 million and $54.9 million on a GAAP basis and between
approximately $42.6 million and $44.4 million on a non-GAAP basis.
-
Enactment of the 2017 Tax Cuts and Jobs Act is not expected to result
in an increase in the U.S. cash tax paid given the offset of the
Company's nearly $300 million in Net Operating Loss ("NOL")
carryforwards.
* For a reconciliation of GAAP to non-GAAP business outlook, see
accompanying tables "Reconciliation of U.S. GAAP to Non-GAAP Financial
Measures."
Investor Conference Call / Webcast Details:
Lattice Semiconductor will review the Company's financial results for
the fiscal fourth quarter and full 2017 and business outlook for the
first quarter of 2018 on Tuesday, February 13 at 5:00 p.m. Eastern Time.
The conference call-in number is 1-888-684-5603 or 1-918-398-4852 with
conference identification number 9681558. An accompanying presentation
and live webcast of the conference call will also be available on
Lattice's website at www.latticesemi.com.
The Company's financial guidance will be limited to the comments on its
public quarterly earnings call and the public business outlook
statements contained in this press release.
A replay of the call will be available approximately 2 hours after the
conclusion of the live call through 11:59 p.m. Eastern Time on February
20, 2018, by telephone at 1-404-537-3406. To access the replay, use
conference identification number 9681558. A webcast replay will also be
available on the investor relations section of www.latticesemi.com.
Forward-Looking Statements Notice:
The foregoing paragraphs contain forward-looking statements that involve
estimates, assumptions, risks and uncertainties. Any statements about
our expectations, beliefs, plans, objectives, assumptions or future
events or performance are not historical facts and may be
forward-looking. Such forward-looking statements include statements
relating to: our expectation that we will continue to execute on our
primary goals - driving a return to revenue growth, further reducing
operating expenses, increasing free cash flow, along with paying down
corporate debt; our expectation that we will achieve operating expenses
on a non-GAAP basis at 35% of revenue, and that we will reach this in
the second half of 2018; our belief that we possess the continued
balance sheet strength needed to pay down our corporate debt and to
capture additional high potential growth opportunities in front of us;
and the statements under the heading "Business Outlook-First Quarter
2018." Other forward-looking statements may be indicated by words such
as "will," "could," "should," "would," "may," "expect," "plan,"
"project," "anticipate," "intend," "forecast," "future," "believe,"
"estimate," "predict," "propose," "potential," "continue" or the
negative of these terms or other comparable terminology; and our
expectation that we will remain focused on maximizing the leverage of
our operating model and reduce our outstanding debt balance. Lattice
believes the factors identified below could cause actual results to
differ materially from the forward-looking statements.
Estimates of future revenue are inherently uncertain due to such factors
as global economic conditions, which may affect customer demand, pricing
pressures, competitive actions, the demand for our Mature, Mainstream
and New products, and in particular our iCE40™ and MachXO3L™ devices,
the ability to supply products to customers in a timely manner, changes
in our distribution relationships, or the volatility of our consumer
business. Actual gross margin percentage and operating expenses could
vary from the estimates on the basis of, among other things, changes in
revenue levels, changes in product pricing and mix, changes in wafer,
assembly, test and other costs, including commodity costs, variations in
manufacturing yields, the failure to sustain operational improvements,
the actual amount of compensation charges due to stock price changes.
Any unanticipated declines in revenue or gross margin, any unanticipated
increases in our operating expenses or unanticipated charges could
adversely affect our profitability.
In addition to the foregoing, other factors that may cause actual
results to differ materially from the forward-looking statements in this
press release include global economic uncertainty, overall semiconductor
market conditions, market acceptance and demand for our new products,
the Company's dependencies on its silicon wafer suppliers, the impact of
competitive products and pricing, technological and product development
risks, the failure to achieve the anticipated benefits and synergies of
the Silicon Image transaction. In addition, actual results are subject
to other risks and uncertainties that relate more broadly to our overall
business, including those risks more fully described in Lattice's
filings with the SEC including its annual report on Form 10-K for the
fiscal year ended December 31, 2016, and Lattice's quarterly reports
filed on Form 10-Q.
You should not unduly rely on forward-looking statements because actual
results could differ materially from those expressed in any
forward-looking statements. In addition, any forward-looking statement
applies only as of the date on which it is made. The Company does not
intend to update or revise any forward-looking statements, whether as a
result of events or circumstances after the date hereof or to reflect
the occurrence of unanticipated events.
Non-GAAP Financial Measures:
Included within this press release and the accompanying tables and notes
are non-GAAP financial measures that supplement the Company's
consolidated financial information prepared in accordance with U.S.
GAAP. The non-GAAP measures presented exclude charges and adjustments
primarily related to stock-based compensation, restructuring charges,
acquisition-related charges, amortization of acquired intangible assets,
impairment of intangible assets, purchase accounting adjustments, gain
on sale of building, gain or loss on sale of business unit, and the
estimated tax effect of these items. These charges and adjustments may
be nonrecurring in nature but are a result of periodic or non-core
operating activities of the Company. The Company describes these
non-GAAP financial measures and reconciles them to the most directly
comparable GAAP measures in the tables and notes attached to this press
release.
The Company's management believes that these non-GAAP financial measures
provide an additional and useful way of viewing aspects of our
performance that, when viewed in conjunction with our GAAP results,
provide a more comprehensive understanding of the various factors and
trends affecting our ongoing financial performance and operating results
than GAAP measures alone. In particular, investors may find the non-GAAP
measures useful in reviewing our operating performance without the
significant accounting charges resulting from the Silicon Image
acquisition, alongside the comparably adjusted prior year results.
Management also uses these non-GAAP measures for strategic and business
decision-making, internal budgeting, forecasting, and resource
allocation processes and believes that investors should have access to
similar data when making their investment decisions.
In addition, the Company uses Adjusted EBITDA in calculating the annual
excess cash flow debt payment. These non-GAAP measures are included
solely for informational and comparative purposes and are not meant as a
substitute for GAAP and should be considered together with the
consolidated financial information located in the tables attached to
this press release.
About Lattice Semiconductor Corporation:
Lattice Semiconductor (NASDAQ: LSCC) is a leader in smart connectivity
solutions at the network edge, where the "things" of IoT live. Our low
power FPGA, 60 GHz millimeter wave, video ASSP and IP products deliver
edge intelligence, edge connectivity, and control solutions to the
consumer, communications, industrial, compute, and automotive markets.
Our unwavering commitment to our global customers enables them to
accelerate their innovation, creating an ever better and more connected
world.
For more information about Lattice please visit www.latticesemi.com.
You can also follow us via LinkedIn, Twitter, Facebook, YouTube,
WeChat,
Weibo or Youku.
Lattice Semiconductor Corporation, Lattice (& design), L (& design),
iCE40 and MachXO3L, and specific product designations are either
registered trademarks or trademarks of Lattice Semiconductor Corporation
or its subsidiaries in the United States and/or other countries.
GENERAL NOTICE: Other product names used in this publication are for
identification purposes only and may be trademarks of their respective
holders.
|
Lattice Semiconductor Corporation
Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Twelve Months Ended
|
|
|
December 30, 2017
|
|
September 30, 2017
|
|
December 31, 2016
|
|
December 30, 2017
|
|
December 31, 2016
|
Revenue
|
|
$
|
95,266
|
|
|
$
|
91,971
|
|
|
$
|
118,108
|
|
|
$
|
385,961
|
|
|
$
|
427,054
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
Cost of sales
|
|
44,050
|
|
|
38,649
|
|
|
54,628
|
|
|
169,382
|
|
|
180,620
|
|
Research and development
|
|
23,500
|
|
|
25,648
|
|
|
26,248
|
|
|
103,357
|
|
|
117,518
|
|
Selling, general, and administrative
|
|
23,585
|
|
|
21,290
|
|
|
22,745
|
|
|
90,718
|
|
|
98,602
|
|
Amortization of acquired intangible assets
|
|
5,563
|
|
|
8,526
|
|
|
8,283
|
|
|
31,340
|
|
|
33,575
|
|
Restructuring
|
|
2,483
|
|
|
3,071
|
|
|
951
|
|
|
7,196
|
|
|
9,267
|
|
Acquisition related charges
|
|
573
|
|
|
681
|
|
|
6,211
|
|
|
3,781
|
|
|
6,305
|
|
Impairment of acquired intangible assets
|
|
(3,767
|
)
|
|
36,198
|
|
|
-
|
|
|
32,431
|
|
|
7,866
|
|
Gain on sale of building
|
|
-
|
|
|
(4,624
|
)
|
|
-
|
|
|
(4,624
|
)
|
|
-
|
|
|
|
95,987
|
|
|
129,439
|
|
|
119,066
|
|
|
433,581
|
|
|
453,753
|
|
Loss from operations
|
|
(721
|
)
|
|
(37,468
|
)
|
|
(958
|
)
|
|
(47,620
|
)
|
|
(26,699
|
)
|
Interest expense
|
|
(4,695
|
)
|
|
(3,888
|
)
|
|
(5,070
|
)
|
|
(18,807
|
)
|
|
(20,327
|
)
|
Other (expense) income, net
|
|
(1,182
|
)
|
|
(2,027
|
)
|
|
371
|
|
|
(3,286
|
)
|
|
2,844
|
|
Loss before income taxes
|
|
(6,598
|
)
|
|
(43,383
|
)
|
|
(5,657
|
)
|
|
(69,713
|
)
|
|
(44,182
|
)
|
Income tax expense (benefit)
|
|
615
|
|
|
(331
|
)
|
|
2,507
|
|
|
849
|
|
|
9,917
|
|
Net loss
|
|
$
|
(7,213
|
)
|
|
$
|
(43,052
|
)
|
|
$
|
(8,164
|
)
|
|
$
|
(70,562
|
)
|
|
$
|
(54,099
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per share, basic and diluted
|
|
$
|
(0.06
|
)
|
|
$
|
(0.35
|
)
|
|
$
|
(0.07
|
)
|
|
$
|
(0.58
|
)
|
|
$
|
(0.45
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in per share calculations, basic and diluted
|
|
123,541
|
|
|
122,990
|
|
|
121,236
|
|
|
122,677
|
|
|
119,994
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lattice Semiconductor Corporation
Consolidated Balance Sheets
(in thousands)
(unaudited)
|
|
|
|
|
|
|
|
December 30, 2017
|
|
December 31, 2016
|
Assets
|
|
|
|
|
Current assets:
|
|
|
|
|
Cash, cash equivalents and short-term marketable securities
|
|
$
|
111,797
|
|
|
$
|
116,860
|
Accounts receivable, net
|
|
55,104
|
|
|
99,637
|
Inventories
|
|
79,903
|
|
|
79,168
|
Other current assets
|
|
16,567
|
|
|
19,035
|
Total current assets
|
|
263,371
|
|
|
314,700
|
|
|
|
|
|
Property and equipment, net
|
|
40,423
|
|
|
49,481
|
Intangible assets, net of amortization
|
|
51,308
|
|
|
118,863
|
Goodwill
|
|
267,514
|
|
|
269,758
|
Deferred income taxes
|
|
198
|
|
|
372
|
Other long-term assets
|
|
13,147
|
|
|
13,709
|
|
|
$
|
635,961
|
|
|
$
|
766,883
|
|
|
|
|
|
Liabilities and Stockholders' Equity
|
|
|
|
|
Current liabilities:
|
|
|
|
|
Accounts payable and other accrued liabilities
|
|
$
|
64,821
|
|
|
$
|
90,798
|
Current portion of long-term debt
|
|
1,508
|
|
|
33,767
|
Deferred income and allowances on sales to sell-through distributors
and deferred license revenue
|
|
17,318
|
|
|
32,985
|
Total current liabilities
|
|
83,647
|
|
|
157,550
|
|
|
|
|
|
Long-term debt
|
|
299,667
|
|
|
300,855
|
Other long-term liabilities
|
|
34,954
|
|
|
38,048
|
Total liabilities
|
|
418,268
|
|
|
496,453
|
|
|
|
|
|
Stockholders' equity
|
|
217,693
|
|
|
270,430
|
|
|
$
|
635,961
|
|
|
$
|
766,883
|
|
|
|
|
|
|
|
|
|
Lattice Semiconductor Corporation
Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
|
|
|
|
|
|
Twelve Months Ended
|
|
|
December 30, 2017
|
|
December 31, 2016
|
Cash flows from operating activities:
|
|
|
|
|
Net loss
|
|
$
|
(70,562
|
)
|
|
$
|
(54,099
|
)
|
Adjustments to reconcile net loss to net cash provided by operating
activities:
|
|
|
|
|
Depreciation and amortization
|
|
57,861
|
|
|
61,806
|
|
Impairment of acquired intangible assets
|
|
32,431
|
|
|
7,866
|
|
Amortization of debt issuance costs and discount
|
|
1,982
|
|
|
1,350
|
|
Change in deferred income tax provision
|
|
(154
|
)
|
|
90
|
|
Loss on sale or maturity of marketable securities
|
|
252
|
|
|
79
|
|
Gain on forward contracts
|
|
(77
|
)
|
|
(184
|
)
|
Stock-based compensation expense
|
|
12,543
|
|
|
16,213
|
|
(Gain) loss on disposal of fixed assets
|
|
(75
|
)
|
|
597
|
|
Gain on sale of building
|
|
(4,624
|
)
|
|
-
|
|
Loss (gain) on sale of assets and business units
|
|
1,496
|
|
|
(2,646
|
)
|
Impairment of cost-method investment
|
|
1,761
|
|
|
1,459
|
|
Changes in assets and liabilities:
|
|
|
|
|
Accounts receivable, net
|
|
44,613
|
|
|
(11,419
|
)
|
Inventories
|
|
(902
|
)
|
|
(3,272
|
)
|
Prepaid expenses and other assets
|
|
889
|
|
|
(2,270
|
)
|
Accounts payable and accrued expenses (includes restructuring)
|
|
(23,588
|
)
|
|
8,338
|
|
Accrued payroll obligations
|
|
726
|
|
|
402
|
|
Income taxes payable
|
|
(556
|
)
|
|
3,216
|
|
Deferred income and allowances on sales to sell-through distributors
|
|
(15,007
|
)
|
|
14,391
|
|
Deferred licensing and services revenue
|
|
(495
|
)
|
|
(183
|
)
|
Net cash provided by operating activities
|
|
38,514
|
|
|
41,734
|
|
Cash flows from investing activities:
|
|
|
|
|
Proceeds from sales of and maturities of short-term marketable
securities
|
|
12,689
|
|
|
14,897
|
|
Purchases of marketable securities
|
|
(7,420
|
)
|
|
(7,490
|
)
|
Proceeds from sale of building
|
|
7,895
|
|
|
-
|
|
Cash paid for costs of sale of building
|
|
(1,004
|
)
|
|
-
|
|
Capital expenditures
|
|
(12,855
|
)
|
|
(16,717
|
)
|
Proceeds from sale of assets and business unit, net of cash sold
|
|
967
|
|
|
1,972
|
|
Repayment received on short-term loan to cost-method investee
|
|
2,000
|
|
|
-
|
|
Short-term loan to cost-method investee
|
|
(2,000
|
)
|
|
-
|
|
Cash paid for a cost-method investment
|
|
-
|
|
|
(1,000
|
)
|
Cash paid for software licenses
|
|
(8,532
|
)
|
|
(9,035
|
)
|
Net cash used in investing activities
|
|
(8,260
|
)
|
|
(17,373
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lattice Semiconductor Corporation
|
Consolidated Statements of Cash Flows (continued)
|
(in thousands)
|
(unaudited)
|
|
|
|
|
|
|
|
Twelve Months Ended
|
|
|
December 30, 2017
|
|
December 31, 2016
|
Cash flows from financing activities:
|
|
|
|
|
Restricted stock unit withholdings
|
|
(3,267
|
)
|
|
(3,565
|
)
|
Proceeds from issuance of common stock
|
|
6,085
|
|
|
7,607
|
|
Repayment of debt
|
|
(35,429
|
)
|
|
(5,154
|
)
|
Net cash used in financing activities
|
|
(32,611
|
)
|
|
(1,112
|
)
|
Effect of exchange rate change on cash
|
|
2,620
|
|
|
(1,303
|
)
|
Net increase in cash and cash equivalents
|
|
263
|
|
|
21,946
|
|
Beginning cash and cash equivalents
|
|
106,552
|
|
|
84,606
|
|
Ending cash and cash equivalents
|
|
$
|
106,815
|
|
|
$
|
106,552
|
|
|
|
|
|
|
Supplemental cash flow information:
|
|
|
|
|
Change in unrealized loss related to marketable securities, net of
tax, included in Accumulated other comprehensive loss
|
|
$
|
73
|
|
|
$
|
172
|
|
Income taxes paid, net of refunds
|
|
$
|
2,387
|
|
|
$
|
9,359
|
|
Interest paid
|
|
$
|
20,649
|
|
|
$
|
18,159
|
|
Accrued purchases of plant and equipment
|
|
$
|
588
|
|
|
$
|
1,028
|
|
Note receivable resulting from sale of assets and business units
|
|
$
|
3,050
|
|
|
$
|
-
|
|
|
|
|
|
|
|
|
|
|
|
Lattice Semiconductor Corporation
- Supplemental Historical Financial Information -
(unaudited)
|
|
|
|
|
|
Three Months Ended
|
|
Twelve Months Ended
|
|
December 30, 2017
|
|
September 30, 2017
|
|
December 31, 2016
|
|
December 30, 2017
|
|
December 31, 2016
|
Operations and Cash Flow Information
|
|
|
|
|
|
|
|
|
Percent of Revenue
|
|
|
|
|
|
|
|
|
|
Gross Margin
|
53.8
|
%
|
|
58.0
|
%
|
|
53.7
|
%
|
|
56.1
|
%
|
|
57.7
|
%
|
R&D Expense
|
24.7
|
%
|
|
27.9
|
%
|
|
22.2
|
%
|
|
26.8
|
%
|
|
27.5
|
%
|
SG&A Expense
|
24.8
|
%
|
|
23.1
|
%
|
|
19.3
|
%
|
|
23.5
|
%
|
|
23.1
|
%
|
Depreciation and amortization (in thousands)
|
12,270
|
|
|
15,094
|
|
|
13,898
|
|
|
57,861
|
|
|
61,806
|
|
Stock-based compensation expense (in thousands)
|
3,257
|
|
|
2,514
|
|
|
4,106
|
|
|
12,543
|
|
|
16,213
|
|
Restructuring and severance related charges (in thousands)
|
2,483
|
|
|
3,071
|
|
|
951
|
|
|
7,196
|
|
|
9,267
|
|
Net cash provided by operating activities (thousands)
|
2,768
|
|
|
24,232
|
|
|
22,416
|
|
|
38,514
|
|
|
41,734
|
|
Capital expenditures (in thousands)
|
530
|
|
|
5,290
|
|
|
2,726
|
|
|
12,855
|
|
|
16,717
|
|
Repayment of debt (in thousands)
|
1,750
|
|
|
-
|
|
|
875
|
|
|
35,429
|
|
|
5,154
|
|
Interest paid (in thousands)
|
4,270
|
|
|
4,285
|
|
|
4,310
|
|
|
20,649
|
|
|
18,159
|
|
Taxes paid (cash, in thousands)
|
79
|
|
|
1,332
|
|
|
2,109
|
|
|
2,387
|
|
|
9,359
|
|
|
|
|
|
|
|
|
|
|
|
Balance Sheet Information
|
|
|
|
|
|
|
|
|
|
Current Ratio
|
3.1
|
|
|
2.2
|
|
|
2.0
|
|
|
|
|
|
A/R Days Revenue Outstanding
|
53
|
|
|
78
|
|
|
77
|
|
|
|
|
|
Inventory Months
|
5.4
|
|
|
6.0
|
|
|
4.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue% (by Geography)
|
|
|
|
|
|
|
|
|
|
Asia
|
74
|
%
|
|
75
|
%
|
|
75
|
%
|
|
72
|
%
|
|
71
|
%
|
Europe (incl. Africa)
|
13
|
%
|
|
12
|
%
|
|
14
|
%
|
|
12
|
%
|
|
14
|
%
|
Americas
|
13
|
%
|
|
13
|
%
|
|
11
|
%
|
|
16
|
%
|
|
15
|
%
|
|
|
|
|
|
|
|
|
|
|
Revenue% (by End Market)
|
|
|
|
|
|
|
|
|
|
Communications and Computing
|
30
|
%
|
|
30
|
%
|
|
26
|
%
|
|
29
|
%
|
|
29
|
%
|
Mobile and Consumer
|
27
|
%
|
|
28
|
%
|
|
36
|
%
|
|
28
|
%
|
|
30
|
%
|
Industrial and Automotive
|
41
|
%
|
|
37
|
%
|
|
31
|
%
|
|
35
|
%
|
|
33
|
%
|
Licensing and Services
|
2
|
%
|
|
5
|
%
|
|
7
|
%
|
|
8
|
%
|
|
8
|
%
|
|
|
|
|
|
|
|
|
|
|
Revenue% (by Channel)
|
|
|
|
|
|
|
|
|
|
Sell-through distribution
|
71
|
%
|
|
68
|
%
|
|
68
|
%
|
|
66
|
%
|
|
61
|
%
|
Direct
|
29
|
%
|
|
32
|
%
|
|
32
|
%
|
|
34
|
%
|
|
39
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lattice Semiconductor Corporation
- Reconciliation of U.S. GAAP to Non-GAAP Financial Measures -
(in thousands, except per share data)
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Twelve Months Ended
|
|
|
December 30, 2017
|
|
September 30, 2017
|
|
December 31, 2016
|
|
December 30, 2017
|
|
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
Gross Margin Reconciliation
|
GAAP Gross margin
|
|
$
|
51,216
|
|
|
$
|
53,322
|
|
|
$
|
63,480
|
|
|
$
|
216,579
|
|
|
$
|
246,434
|
|
Inventory step-up expense
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
523
|
|
Stock-based compensation - gross margin
|
|
226
|
|
|
154
|
|
|
232
|
|
|
788
|
|
|
888
|
|
Non-GAAP Gross margin
|
|
$
|
51,442
|
|
|
$
|
53,476
|
|
|
$
|
63,712
|
|
|
$
|
217,367
|
|
|
$
|
247,845
|
|
|
Gross Margin % Reconciliation
|
GAAP Gross margin %
|
|
53.8
|
%
|
|
58.0
|
%
|
|
53.7
|
%
|
|
56.1
|
%
|
|
57.7
|
%
|
Cumulative effect of non-GAAP Gross Margin adjustments
|
|
0.2
|
%
|
|
0.1
|
%
|
|
0.2
|
%
|
|
0.2
|
%
|
|
0.3
|
%
|
Non-GAAP Gross margin %
|
|
54.0
|
%
|
|
58.1
|
%
|
|
53.9
|
%
|
|
56.3
|
%
|
|
58.0
|
%
|
|
Operating Expenses Reconciliation
|
GAAP Operating expenses
|
|
$
|
51,937
|
|
|
$
|
90,790
|
|
|
$
|
64,438
|
|
|
$
|
264,199
|
|
|
$
|
273,133
|
|
Amortization of acquired intangible assets
|
|
(5,563
|
)
|
|
(8,526
|
)
|
|
(8,283
|
)
|
|
(31,340
|
)
|
|
(33,575
|
)
|
Restructuring charges
|
|
(2,483
|
)
|
|
(3,071
|
)
|
|
(951
|
)
|
|
(7,196
|
)
|
|
(9,267
|
)
|
Acquisition related charges (1)
|
|
(573
|
)
|
|
(681
|
)
|
|
(6,211
|
)
|
|
(3,781
|
)
|
|
(6,305
|
)
|
Impairment of acquired intangible assets
|
|
3,767
|
|
|
(36,198
|
)
|
|
-
|
|
|
(32,431
|
)
|
|
(7,866
|
)
|
Stock-based compensation - operations
|
|
(3,031
|
)
|
|
(2,360
|
)
|
|
(3,874
|
)
|
|
(11,755
|
)
|
|
(15,325
|
)
|
Gain on sale of building
|
|
-
|
|
|
4,624
|
|
|
-
|
|
|
4,624
|
|
|
-
|
|
Non-GAAP Operating expenses
|
|
$
|
44,054
|
|
|
$
|
44,578
|
|
|
$
|
45,119
|
|
|
$
|
182,320
|
|
|
$
|
200,795
|
|
|
(1) Legal fees and outside services that were related to our
proposed acquisition by Canyon Bridge Acquisition Company, Inc.
|
|
|
Lattice Semiconductor Corporation
|
- Reconciliation of U.S. GAAP to Non-GAAP Financial Measures -
|
(in thousands, except per share data)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Twelve Months Ended
|
|
|
December 30, 2017
|
|
September 30, 2017
|
|
December 31, 2016
|
|
December 30, 2017
|
|
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) Income from Operations Reconciliation
|
GAAP Loss from operations
|
|
$
|
(721
|
)
|
|
$
|
(37,468
|
)
|
|
$
|
(958
|
)
|
|
$
|
(47,620
|
)
|
|
$
|
(26,699
|
)
|
Inventory step-up expense
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
523
|
|
Stock-based compensation - gross margin
|
|
226
|
|
|
154
|
|
|
232
|
|
|
788
|
|
|
888
|
|
Amortization of acquired intangible assets
|
|
5,563
|
|
|
8,526
|
|
|
8,283
|
|
|
31,340
|
|
|
33,575
|
|
Restructuring charges
|
|
2,483
|
|
|
3,071
|
|
|
951
|
|
|
7,196
|
|
|
9,267
|
|
Acquisition related charges (1)
|
|
573
|
|
|
681
|
|
|
6,211
|
|
|
3,781
|
|
|
6,305
|
|
Impairment of acquired intangible assets
|
|
(3,767
|
)
|
|
36,198
|
|
|
-
|
|
|
32,431
|
|
|
7,866
|
|
Stock-based compensation - operations
|
|
3,031
|
|
|
2,360
|
|
|
3,874
|
|
|
11,755
|
|
|
15,325
|
|
Gain on sale of building
|
|
-
|
|
|
(4,624
|
)
|
|
-
|
|
|
(4,624
|
)
|
|
-
|
|
Non-GAAP Income from operations
|
|
$
|
7,388
|
|
|
$
|
8,898
|
|
|
$
|
18,593
|
|
|
$
|
35,047
|
|
|
$
|
47,050
|
|
|
(Loss) Income from Operations % Reconciliation
|
GAAP Loss from operations %
|
|
(0.8
|
)%
|
|
(40.7
|
)%
|
|
(0.8
|
)%
|
|
(12.3
|
)%
|
|
(6.3
|
)%
|
Cumulative effect of non-GAAP Gross Margin and Operating adjustments
|
|
8.6
|
%
|
|
50.4
|
%
|
|
16.5
|
%
|
|
21.4
|
%
|
|
17.3
|
%
|
Non-GAAP Income from operations %
|
|
7.8
|
%
|
|
9.7
|
%
|
|
15.7
|
%
|
|
9.1
|
%
|
|
11.0
|
%
|
|
Other (Expense) Income, Net Reconciliation
|
GAAP Other (expense) income, net
|
|
$
|
(1,182
|
)
|
|
$
|
(2,027
|
)
|
|
$
|
371
|
|
|
$
|
(3,286
|
)
|
|
$
|
2,844
|
|
Loss (gain) on sale of assets and business units
|
|
-
|
|
|
1,796
|
|
|
-
|
|
|
1,496
|
|
|
(2,646
|
)
|
Non-GAAP Other (expense) income, net
|
|
$
|
(1,182
|
)
|
|
$
|
(231
|
)
|
|
$
|
371
|
|
|
$
|
(1,790
|
)
|
|
$
|
198
|
|
|
Income Tax Expense (Benefit) Reconciliation
|
GAAP Income tax expense (benefit)
|
|
$
|
615
|
|
|
$
|
(331
|
)
|
|
$
|
2,507
|
|
|
$
|
849
|
|
|
$
|
9,917
|
|
Estimated tax effect of non-GAAP adjustments (2)
|
|
(142
|
)
|
|
(218
|
)
|
|
(438
|
)
|
|
-
|
|
|
-
|
|
Non-GAAP Income tax expense (benefit)
|
|
$
|
473
|
|
|
$
|
(549
|
)
|
|
$
|
2,069
|
|
|
$
|
849
|
|
|
$
|
9,917
|
|
|
(1) Legal fees and outside services that were related to our
proposed acquisition by Canyon Bridge Acquisition Company, Inc.
|
(2) We calculate non-GAAP tax expense by applying our tax provision
model to year-to-date and projected income after adjusting
|
for non-GAAP items. The difference between calculated values for
GAAP and non-GAAP tax expense has been included as
|
the "Estimated tax effect of non-GAAP adjustments."
|
|
|
Lattice Semiconductor Corporation
|
- Reconciliation of U.S. GAAP to Non-GAAP Financial Measures -
|
(in thousands, except per share data)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Twelve Months Ended
|
|
|
December 30, 2017
|
|
September 30, 2017
|
|
December 31, 2016
|
|
December 30, 2017
|
|
December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
Net (Loss) Income Reconciliation
|
GAAP Net loss
|
|
$
|
(7,213
|
)
|
|
$
|
(43,052
|
)
|
|
$
|
(8,164
|
)
|
|
$
|
(70,562
|
)
|
|
$
|
(54,099
|
)
|
Inventory step-up expense
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
523
|
|
Stock-based compensation - gross margin
|
|
226
|
|
|
154
|
|
|
232
|
|
|
788
|
|
|
888
|
|
Amortization of acquired intangible assets
|
|
5,563
|
|
|
8,526
|
|
|
8,283
|
|
|
31,340
|
|
|
33,575
|
|
Restructuring charges
|
|
2,483
|
|
|
3,071
|
|
|
951
|
|
|
7,196
|
|
|
9,267
|
|
Acquisition related charges (1)
|
|
573
|
|
|
681
|
|
|
6,211
|
|
|
3,781
|
|
|
6,305
|
|
Impairment of acquired intangible assets
|
|
(3,767
|
)
|
|
36,198
|
|
|
-
|
|
|
32,431
|
|
|
7,866
|
|
Stock-based compensation - operations
|
|
3,031
|
|
|
2,360
|
|
|
3,874
|
|
|
11,755
|
|
|
15,325
|
|
Gain on sale of building
|
|
-
|
|
|
(4,624
|
)
|
|
-
|
|
|
(4,624
|
)
|
|
-
|
|
Loss (gain) on sale of assets and business units
|
|
-
|
|
|
1,796
|
|
|
-
|
|
|
1,496
|
|
|
(2,646
|
)
|
Estimated tax effect of non-GAAP adjustments (2)
|
|
142
|
|
|
218
|
|
|
438
|
|
|
-
|
|
|
-
|
|
Non-GAAP Net income
|
|
$
|
1,038
|
|
|
$
|
5,328
|
|
|
$
|
11,825
|
|
|
$
|
13,601
|
|
|
$
|
17,004
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (Loss) Income Per Share Reconciliation
|
GAAP Net loss per share - basic and diluted
|
|
$
|
(0.06
|
)
|
|
$
|
(0.35
|
)
|
|
$
|
(0.07
|
)
|
|
$
|
(0.58
|
)
|
|
$
|
(0.45
|
)
|
Cumulative effect of Non-GAAP adjustments
|
|
0.07
|
|
|
0.39
|
|
|
0.17
|
|
|
0.69
|
|
|
0.59
|
|
Non-GAAP Net income per share - basic and diluted
|
|
$
|
0.01
|
|
|
$
|
0.04
|
|
|
$
|
0.10
|
|
|
$
|
0.11
|
|
|
$
|
0.14
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in per share calculations:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
123,541
|
|
|
122,990
|
|
|
121,236
|
|
|
122,677
|
|
|
119,994
|
|
Diluted - GAAP (3)
|
|
123,541
|
|
|
122,990
|
|
|
121,236
|
|
|
122,677
|
|
|
119,994
|
|
Diluted - Non-GAAP (3)
|
|
124,370
|
|
|
124,225
|
|
|
123,621
|
|
|
124,499
|
|
|
121,957
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Legal fees and outside services that were related to our
proposed acquisition by Canyon Bridge Acquisition Company, Inc.
|
(2) We calculate non-GAAP tax expense by applying our tax provision
model to year-to-date and projected income after adjusting
|
for non-GAAP items. The difference between calculated values for
GAAP and non-GAAP tax expense has been included as
|
the "Estimated tax effect of non-GAAP adjustments."
|
(3) Diluted shares are calculated using the GAAP treasury stock
method. In a loss position, diluted shares equal basic shares.
|
|
Lattice Semiconductor Corporation
|
- Reconciliation of U.S. GAAP to Non-GAAP Financial Measures -
|
(in thousands, except per share data)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
March 31, 2018
|
|
|
|
|
|
|
|
Business Outlook - First Quarter 2018
|
|
Low -2%
|
|
Midpoint
|
|
High +2%
|
|
|
|
|
|
|
|
GAAP Operating expenses
|
|
$
|
52,700
|
|
|
$
|
53,800
|
|
|
$
|
54,900
|
|
Cumulative effect of Non-GAAP Operating expense adjustments (4)
|
|
(10,100
|
)
|
|
(10,300
|
)
|
|
(10,500
|
)
|
Non-GAAP Operating expenses
|
|
$
|
42,600
|
|
|
$
|
43,500
|
|
|
$
|
44,400
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4) Includes estimated Amortization of acquired intangible assets,
Restructuring charges, and Stock-based
|
compensation included in Operating Expenses.
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20180213006264/en/
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