Integrated Device Technology, Inc. (IDT®) (NASDAQ: IDTI), the
Analog and Digital Company™ delivering essential mixed-signal
semiconductor solutions, today announced results for the fiscal
fourth quarter and year ended April 3, 2011.
“Our better-than-expected fourth quarter results reflected
increasing adoption of our mixed-signal solutions by enterprise
computing and wireless infrastructure customers, and highlighted
continuing gross margin expansion and solid execution across all of
our business units,” said Dr. Ted Tewksbury, president and CEO of
IDT. “We grew revenue 17 percent in fiscal 2011 from the prior year
despite significant old product rolloffs like advanced memory
buffers, network search engines, and PC clocks. New product revenue
grew by more than 60 percent, and our core businesses had an
outstanding year as we grew communications clock revenue 40 percent
to a record high and our DDR3 memory interface revenue doubled. We
also more than doubled our non-GAAP operating income and EPS in
fiscal 2011 from the prior year while gross margins reached a
10-year high.
“As we enter fiscal year 2012, we believe that continued growth
in our new and core businesses, driven by cloud computing and the
ongoing deployment of 4G/LTE wireless infrastructure, will drive
continuing top line improvement. By focusing on higher margin
solutions and maintaining disciplined operating expense controls,
we believe we can continue to demonstrate significant leverage in
our model and deliver improved value for our shareholders.”
Recent Highlights
IDT recently announced:
- It introduced its first RF (Radio
Frequency) device for use in the RF signal path of multi-protocol
wireless base stations. The new Intermediate Frequency (IF)
Variable Gain Amplifier (VGA) with the industry's lowest noise to
improve Quality of Service is the first in a series of upcoming RF
products.
- It has introduced a new low power, high
accuracy thermal sensor for DDR3 memory modules (Enhanced Temp
Sensor) to complement its recently announced DDR3 memory buffer for
Load Reduced DIMMs (LRDIMM) targeted at Cloud Computing
applications.
- The industry’s widest range poly-phase
power metering products for Smart Grid applications (3 phase power
meter IC) expanding its award winning single-phase power metering
products.
- The industry's first
signal-conditioning repeater to pass all tests required for full
compliance with the Serial Advanced Technology Attachment (SATA)
6Gb/s standard for Hard Disk Drive (HDD) and Solid State Drive
(SSD) interfaces.
- It expanded its Gen 2 RapidIO switch
family with an intermediate sized switch in response to market
demand and announced a design with Curtiss Wright for the new
device.
- Its RapidIO® Gen2 switch has been
selected by Texas Instruments for its new evaluation module for
wireless base stations.
- Its RapidIO switch has been selected by
RADVISION Ltd. for use in its SCOPIA Elite multipoint video
conference system.
- Its PureTouch® capacitive touch
controller has been selected for use in the Hanvon WISEreader, a
popular e-book reader.
- Its PowerSmart™ Panel Controller won
the prestigious Innovation Award presented by EDN magazine
- Its Power Metering IC won the Green
Power Product Award from Electronic Engineering and Product World
Magazine.
The following highlights the Company’s financial performance on
both a GAAP and non-GAAP basis. The GAAP results include certain
costs, charges, gains and losses, which are excluded from non-GAAP
results based on management’s determination that they are not
directly reflective of ongoing operations. Non-GAAP results are not
in accordance with GAAP and may not be comparable to non-GAAP
information provided by other companies. Non-GAAP information
should be considered a supplement to, and not a substitute for,
financial statements prepared in accordance with GAAP. A complete
reconciliation of GAAP to non-GAAP results is attached to this
press release.
- Revenue for the fiscal fourth quarter
of 2011 was $147.3 million, up from $138.0 million reported in the
same period one year ago. Revenue for fiscal year 2011 was $625.7
million, up 17 percent from $535.9 million in fiscal year
2010.
- GAAP net income for the fiscal fourth
quarter of 2011 was $31.4 million or $0.21 per diluted share,
versus GAAP net income of $1.0 million or $0.01 per diluted share
in the same period one year ago. Fiscal fourth quarter 2011 GAAP
results include $19.7 million in tax effects, $5.1 million in
acquisition and divestiture related charges and $3.3 million in
stock-based compensation.
- Non-GAAP net income for the fiscal
fourth quarter of 2011 was $20.2 million or $0.13 per diluted
share, compared with non-GAAP net income of $14.9 million or $0.09
per diluted share reported in the same period one year ago.
Non-GAAP net income for fiscal year 2011 was $96.9 million, more
than doubling from $47.9 million in fiscal year 2010.
- GAAP gross profit for the fiscal fourth
quarter of 2011 was $80.4 million, or 54.6 percent, compared with
GAAP gross profit of $66.9 million, or 48.5 percent, in the same
period one year ago. Non-GAAP gross profit for the fiscal fourth
quarter of 2011 was $84.4 million, or 57.3 percent, compared with
non-GAAP gross profit of $73.2 million, or 53.0 percent, reported
in the same period one year ago. Non-GAAP gross profit for fiscal
year 2011 was $356.2 million, up from $270.2 million in fiscal
2010.
- GAAP R&D expense for the fiscal
fourth quarter of 2011 was $43.7 million, compared with GAAP
R&D expense of $41.4 million reported in the same period one
year ago. Non-GAAP R&D expense for the fiscal fourth quarter of
2011 was $41.6 million, compared with non-GAAP R&D of $37.2
million in the same period one year ago.
- GAAP SG&A expense for the fiscal
fourth quarter of 2011 was $26.9 million, compared with GAAP
SG&A expense of $26.2 million in the same period one year ago.
Non-GAAP SG&A expense for the fiscal fourth quarter of 2011 was
$24.0 million, compared with non-GAAP SG&A expense of $21.7
million in the same period one year ago.
Webcast and Conference Call Information
Investors can listen to a live or replay webcast of the
Company’s quarterly financial conference call at
http://www.IDT.com. The live webcast will begin at 1:30 p.m.
Pacific time on May 9, 2011. The webcast replay will be available
after 5 p.m. Pacific time on May 9, 2011.
Investors can also listen to the live call at 1:30 p.m. Pacific
time on May 9, 2011 by calling (800) 230-1059 or (612) 234-9959.
The conference call replay will be available after 5 p.m. Pacific
time on May 9, 2011 through 11:59 p.m. Pacific time on May 16, 2011
at (800) 475-6701 or (320) 365-3844. The access code is 198224.
About IDT
Integrated Device Technology, Inc., the Analog and Digital
Company™, develops system-level solutions that optimize its
customers’ applications. IDT uses its market leadership in timing,
serial switching and interfaces, and adds analog and system
expertise to provide complete application-optimized, mixed-signal
solutions for the communications, computing and consumer segments.
Headquartered in San Jose, Calif., IDT has design, manufacturing
and sales facilities throughout the world. IDT stock is traded on
the NASDAQ Global Select Stock Market® under the symbol “IDTI.”
Additional information about IDT is accessible at www.IDT.com.
Follow IDT on Facebook, LinkedIn, Twitter, and YouTube.
Forward Looking Statements
Investors are cautioned that forward-looking statements in this
release, including but not limited to statements regarding demand
for Company products, anticipated trends in Company sales, expenses
and profits, involve a number of risks and uncertainties that could
cause actual results to differ materially from current
expectations. Risks include, but are not limited to, global
business and economic conditions, fluctuations in product demand,
manufacturing capacity and costs, inventory management,
competition, pricing, patent and other intellectual property rights
of third parties, timely development and introduction of new
products and manufacturing processes, dependence on one or more
customers for a significant portion of sales, successful
integration of acquired businesses and technology, availability of
capital, cash flow and other risk factors detailed in the Company’s
Securities and Exchange Commission filings. The Company urges
investors to review in detail the risks and uncertainties in the
Company’s Securities and Exchange Commission filings, including but
not limited to the Annual Report on Form 10-K for the fiscal year
ended March 28, 2010. All forward-looking statements are made as of
the date of this release and the Company disclaims any duty to
update such statements.
Non-GAAP Reporting
The Company presents non-GAAP financial measures because the
investor community uses non-GAAP results in its analysis and
comparison of historical results and projections of the Company's
future operating results. These non-GAAP results exclude
restructuring-related costs, acquisition and divestiture-related
charges, share-based compensation expense and certain other
expenses and benefits. Management uses these non-GAAP measures to
manage and assess the profitability of the business. These non-GAAP
results are also consistent with another way management internally
analyzes IDT’s results and may be useful to investor community. The
Company has reconciled non-GAAP results to the most directly
comparable GAAP financial measures in the financial tables at the
end of this press release.
Reference to these non-GAAP results should be considered in
addition to results that are prepared under general accepted
accounting standards in the United States (GAAP), but should not be
considered a substitute for results that are presented in
accordance with GAAP. It should also be noted that IDT's non-GAAP
information may be different from the non-GAAP information provided
by other companies.
IDT, PureTouch, PowerSmart, and the IDT logo
are trademarks or registered trademarks of Integrated Device
Technology, Inc. All other brands, product names and marks are or
may be trademarks or registered trademarks used to identify
products or services of their respective owners.
INTEGRATED DEVICE
TECHNOLOGY, INC. CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS (Unaudited) (In thousands, except per share data)
Three Months Ended Twelve Months Ended April
3, Jan. 2, March 28, April 3, March
28, 2011 2011 2010 2011
2010 Revenues $ 147,294 $ 153,230 $ 137,968 $ 625,704
535,906 Cost of revenues 66,919 70,755
71,086 290,394 310,999
Gross profit 80,375 82,475 66,882 335,310 224,907 Operating
expenses: Research and development 43,681 46,143 41,400 177,546
157,486 Selling, general and administrative 26,936
27,056 26,186 108,191
107,037 Total operating expenses 70,617
73,199 67,586 285,737
264,523 Operating income (loss) 9,758
9,276 (704 ) 49,573
(39,616 ) Gain on divestitures - - 20 - 78,306
Interest income and other, net 904 1,352
701 3,697 3,877
Income before income taxes 10,662 10,628 17 53,270 42,567
Provision (benefit) for income taxes (20,731 ) 31
(950 ) (19,357 ) 2,548
Net income $ 31,393 $ 10,597 $ 967 $
72,627 40,019 Basic net income per
share $ 0.21 $ 0.07 $ 0.01 $ 0.47 $ 0.24 Diluted net income per
share $ 0.21 $ 0.07 $ 0.01 $ 0.47 $ 0.24 Weighted average
shares: Basic 148,181 151,421 164,660 154,511 165,408 Diluted
150,852 152,975 165,418 155,918 165,961
INTEGRATED
DEVICE TECHNOLOGY, INC. RECONCILIATION OF GAAP TO
NON-GAAP (Unaudited) (In thousands, except per share
data)
Three Months Ended Twelve Months
Ended April 3, Jan. 2, Mar.
28, April 3, Mar. 28, 2011
2011 2010 2011 2010 GAAP Net
Income $ 31,393 $ 10,597
$ 967 $ 72,627
$ 40,019 GAAP Diluted Net Income Per
Share $ 0.21 $ 0.07
$ 0.01 $ 0.47 $
0.24 Acquisition and Divestiture Related:
Amortization of acquisition related intangibles 5,016 4,990 4,943
19,933 21,074 Acquisition related costs (1) 98 694 1,130 1,932
4,822 Gain on divestitures (2) - - (20 ) - (78,306 ) Assets
impairment (3) (63 ) (107 ) (251 ) (447 ) 1,602 Fair market value
adjustment to acquired inventory sold - - 379 16,055 Restructuring
Related: Severance and retention costs 137 1,573 2,717 2,105 20,514
Facility closure costs (4) (1,353 ) 124 547 33 606 Fabrication
production transfer costs (5) 1,412 1,639 1,239 5,263 2,344 Other:
Compensation expense —deferred compensation plan (6) 503 815 370
1,808 2,892 Gain on deferred compensation plan securities (6) (507
) (793 ) (373 ) (1,767 ) (2,870 ) Stock-based compensation expense
3,321 4,513 4,333 16,528 16,675 Tax effects of Non-GAAP adjustments
(7) (19,710 ) (1,073 ) (729 ) (21,464 )
2,443
Non-GAAP Net Income $
20,247 $ 22,972 $ 14,873
$ 96,930 $ 47,870 GAAP weighted average
shares - diluted 150,852 152,975 165,418 155,918 165,961 Non-GAAP
adjustment 1,775 2,058 1,782 1,989 1,799 Non-GAAP weighted average
shares - diluted (8) 152,627 155,033
167,200 157,907 167,760
Non-GAAP Diluted Net Income Per Share $ 0.13
$ 0.15 $ 0.09
$ 0.61 $ 0.29
GAAP Gross Profit 80,375
82,475 66,882
335,310 224,907 Acquisition and
Divestiture Related: Amortization of acquisition related
intangibles 3,575 3,549 2,778 14,133 13,956 Acquisition related
costs (1) - - 5 5 5 Assets impairment (3) (63 ) (107 ) (251 ) (447
) 1,535 Fair market value adjustment to acquired inventory sold - -
- 379 16,055 Restructuring Related: Severance and retention costs
51 48 1,841 41 7,990 Facility closure costs (4) (1,483 ) 4 182 (583
) 203 Fabrication production transfer costs (5) 1,412 1,639 1,239
5,263 2,344 Other: Compensation expense - deferred compensation
plan (6) 109 176 52 391 405 Stock-based compensation expense
423 370 512 1,683
2,763
Non-GAAP Gross Profit
84,399 88,154
73,240 356,175
270,163 GAAP R&D Expenses:
43,681 46,143
41,400 177,546
157,486 Acquisition and Divestiture Related:
Amortization of acquisition related intangibles - - (469 ) 0 (469 )
Acquisition related costs (1) (67 ) (400 ) (378 ) (1,263 ) (376 )
Restructuring Related: Severance and retention costs (45 ) (1,053 )
(752 ) (1,433 ) (4,929 ) Facility closure costs (4) (82 ) (6 ) (86
) (204 ) (113 ) Other: Compensation expense - deferred compensation
plan (6) (326 ) (529 ) (200 ) (1,173 ) (1,561 ) Stock-based
compensation expense (1,610 ) (2,836 ) (2,278
) (9,595 ) (10,199 )
Non-GAAP R&D Expenses
41,551 41,319
37,237 163,878
139,839 GAAP SG&A Expenses:
26,936 27,056
26,186 108,191
107,037 Acquisition and Divestiture Related:
Amortization of acquisition related intangibles (1,441 ) (1,441 )
(1,696 ) (5,800 ) (6,649 ) Acquisition related costs (1) (31 ) (294
) (747 ) (664 ) (4,441 ) Restructuring Related: Severance and
retention costs (41 ) (472 ) (124 ) (631 ) (7,595 ) Facility
closure costs (4) (48 ) (114 ) (279 ) (412 ) (290 ) Other:
Compensation expense - deferred compensation plan (6) (68 ) (110 )
(118 ) (244 ) (926 ) Stock-based compensation expense (1,288
) (1,307 ) (1,543 ) (5,250 ) (3,713 )
Non-GAAP SG&A Expenses 24,019
23,318 21,679
95,190 83,423 GAAP
Interest Income and Other, Net 904 1,352
701 3,697 3,877 Gain on deferred compensation
plan securities (6) (507 ) (793 ) (373 ) (1,767 ) (2,870 ) Assets
Impairment - - - -
67
Non-GAAP Interest Income and Other,
Net 397 559
328 1,930 1,074
GAAP Provision for Income Taxes
(20,731 ) 31 (950
) (19,357 ) 2,548
Tax effects of Non-GAAP adjustments (7) 19,710
1,073 729 21,464 (2,443 )
Non-GAAP Provision for Income Taxes (1,021
) 1,104 (221 )
2,107 105
(1) Consists of costs incurred
in connection with merger and acquisition-related activities,
including legal and accounting fees.
(2) Consists of gain and loss
associated with our divestitures of Military business and Silicon
Logic Engineering business in fiscal 2010.
(3) Consists of an impairment
charge related to a note receivable and subsequent recoveries.
(4) Consists of costs
associated with the exit from our leased and owned facilities.
(5) Consists of costs incurred
in connection with the transition of our wafer fabrication
processes from our Oregon plant to TSMC.
(6) Consists of gains and losses on
marketable equity securities related to our deferred compensation
arrangements and the changes in the fair value of the assets in a
separate trust that is invested in Corporate owned life insurance
under our deferred compensation plan.
(7) Consists of the tax effects of
non-GAAP adjustments and tax liability adjustments resulting from
conclusion of an IRS audit.
(8) For purposes of calculating non-GAAP
diluted net income per share, the GAAP diluted weighted average
shares outstanding is adjusted to exclude the benefits of stock
compensation expense attributable to future services not yet
recognized in the financial statements that are treated as proceeds
assumed to be used to repurchase shares under the GAAP treasury
method.
INTEGRATED DEVICE TECHNOLOGY, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
April 3, Mar 28, (In thousands)
2011 2010 ASSETS Current assets:
Cash and cash equivalents $ 104,680 $ 120,526 Short-term
investments 194,512 222,663 Accounts receivable, net 81,798 68,957
Inventories 67,041 50,676 Prepaid and other current assets
23,929 25,086 Total current assets
471,960 487,908 Property, plant and equipment, net 67,754
67,988 Goodwill 104,020 103,074 Acquisition-related intangibles
assets, net 51,021 65,242 Other assets 32,705
26,733
TOTAL ASSETS $ 727,460 $
750,945
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities: Accounts payable $ 36,470 $ 34,717 Accrued
compensation and related expenses 28,212 20,738 Deferred income on
shipments to distributors 12,853 18,761 Income taxes payable 501
513 Other accrued liabilities 32,609
31,972 Total current liabilities 110,645 106,701
Deferred tax liability 1,513 1,573 Long term income taxes payable
712 21,098 Other long term obligations 15,808
21,833 Total liabilities 128,678 151,205
Stockholders' equity Common Stock 148 163 Additional paid-in
capital 2,343,726 2,310,450 Treasury stock (909,824 ) (802,217 )
Accumulated deficit (837,075 ) (909,702 ) Accumulated other
comprehensive income 1,807 1,046
Total stockholders' equity 598,782 599,740
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 727,460
$ 750,945
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