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Xilinx Inc (XLNX) SEC Filing 8-K Material Event for the period ending Wednesday, January 26, 2022

Xilinx Inc

CIK: 743988 Ticker: XLNX

Exhibit 99.1


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


XILINX REPORTS RECORD REVENUE OF $1.01 BILLION IN FISCAL THIRD QUARTER

lRecord revenue of $1,011 million, representing 8% sequential growth and 26% year-over-year growth, despite ongoing industry-wide supply constraints
lData Center Group (DCG) achieved record revenue with sequential growth of 28% and 81% year-over-year, driven by Compute and Networking strength
lAerospace & Defense, Industrial and Test, Measurement & Emulation (AIT) revenue was also a record, increasing 21% sequentially and 28% year-over-year, driven by record A&D revenue and continued strength in ISM and TME end markets
lAutomotive, Broadcast and Consumer (ABC) revenue in the quarter decreased 4% sequentially coming off a record Q2 and largely in-line with expectations; revenue increased 28% year-over-year
lWired and Wireless Group (WWG) revenue decreased 18% sequentially and increased 1% year-over-year as supply constraints had a significant impact on business in the quarter
lPlatform transformation continues with total Adaptive SoC revenue, which includes Zynq and Versal platforms, up 5% sequentially and 30% year-over-year, and representing 28% of total revenue

SAN JOSE, Calif., January 26, 2022 -- Xilinx, Inc. (Nasdaq: XLNX), the leader in adaptive computing, today announced record revenues of $1,011 million for the fiscal third quarter, up 8% over the previous quarter.

GAAP net income for the fiscal third quarter was $300 million, or $1.19 per diluted share. Non-GAAP net income for the quarter was $325 million, or $1.29 per diluted share.

As permitted by the terms of the Merger Agreement between Xilinx and Advanced Micro Devices, Inc. (AMD), the Xilinx Board of Directors voted unanimously to declare a cash dividend of $0.37 per outstanding share of common stock payable on February 14, 2022 to all stockholders of record at the close of business on February 7, 2022. The dividend is conditioned upon and will only be payable if the merger has not closed on or before the record date for such dividend.

Additional third quarter of fiscal year 2022 comparisons are provided in the charts below.















Q3 Fiscal 2022 Financial Highlights
(In millions, except EPS)

GAAP
Q3Q2Q3
FY2022FY2022FY2021Q-T-QY-T-Y
Net revenues*$1,011$936$8038%26%
Gross margin$726$632$54715%33%
Operating income$310$250$17224%80%
Net income$300$235$17128%76%
Diluted earnings per share$1.19$0.94$0.6927%73%
Non-GAAP
Q3Q2Q3
FY2022FY2022FY2021Q-T-QY-T-Y
Net revenues*$1,011$936$8038%26%
Gross margin$736$644$55414%33%
Operating income$340$288$20118%69%
Net income$325$266$19422%67%
Diluted earnings per share$1.29$1.06$0.7822%65%
* No adjustment between GAAP and Non-GAAP
Note: Q3 and Q2 FY2022 consisted of 13 weeks; Q3 FY2021 consisted of 14 weeks

“Xilinx achieved another record quarter and surpassed $1 billion in quarterly sales for the first time in the company’s history,” said Victor Peng, Xilinx president and CEO. “While we were unable to fully satisfy customer needs, our results demonstrate our team’s relentless focus and execution in supporting our customers as well as possible given the extremely tight supply conditions.

“We saw broad and robust demand across our end markets with record quarters in our DCG business as well as our A&D end market. A&D record performance, combined with strong ISM and TME performance, also led to a record for total AIT, and drove stronger overall profitability. The strength in our business clearly demonstrates the successful execution of our strategy.”

“Record Q3 revenue was driven primarily from sequential growth in A&D, DCG and TME, leading to total sequential revenue growth of 8% and year-over-year growth of 26%, the fifth consecutive quarter of double-digit year-over-year growth,” said Brice Hill, Xilinx CFO. “Overall strong revenues and business mix, in addition to positive impacts from strategic venture investments, drove record earnings this quarter. Our platform strategy continues to progress as Adaptive SoC revenue grew 5% sequentially and 30% year-over-year, representing 28% of total revenue.

“We saw strong free cash flow this quarter of $351 million, or 35% of revenue, reflecting our efficient cash generating business model. Please note, the increase in inventory to 106 days is primarily driven by supply cost increases and does not reflect a significant increase in unit inventory.”



Net Revenues by Geography:
PercentagesGrowth Rates
Q3Q2Q3
FY2022FY2022FY2021Q-T-QY-T-Y
North America33%26%30%40%43%
Asia Pacific40%48%44%-10%13%
Europe18%16%19%16%18%
Japan9%10%7%-1%53%
Net Revenues by End Market:
PercentagesGrowth Rates
Q3Q2Q3
FY2022FY2022FY2021Q-T-QY-T-Y
A&D, Industrial and TME46%40%45%21%28%
Automotive, Broadcast and Consumer19%22%19%-4%28%
Wired and Wireless Group23%31%29%-18%1%
Data Center Group11%9%7%28%81%
Channel1%-2%0%NMNM
Net Revenues by Product:
PercentagesGrowth Rates
Q3Q2Q3
FY2022FY2022FY2021Q-T-QY-T-Y
Advanced Products78%74%72%14%35%
Core Products22%26%28%-8%3%

Products are classified as follows:
Advanced Products: Versal, UltraScale+, UltraScale and 7-series product families, and production boards business composed of Alveo, Solarflare, Network, and System-On-Modules.
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)
Q3Q2Q3
FY2022FY2022FY2021
Operating Cash Flow$362$122$360
Depreciation Expense (including software amortization)$30$31$31
Capital Expenditures (including software)$11$15$6
Free Cash Flow (1)$351$107$354
Inventory Days (internal)10686115
Revenue Turns (%)322334

1.Free Cash Flow = Operating Cash Flow - Capital Expenditures (including software)






Product and Financial Highlights - Fiscal Third Quarter 2022

Xilinx introduced the Alveo U55C data center accelerator card and a new standards-based, API-driven clustering solution for deploying FPGAs at massive scale. The Alveo U55C accelerator brings superior performance-per-watt to high performance computing (HPC) and database workloads and easily scales through the Xilinx HPC clustering solution. Initial customers include Ansys and TigerGraph.
Xilinx announced it is working with its IP and system integrator ecosystem to provide the industry’s first and only production-ready multimedia streaming endpoint solutions for broadcast and professional audio/video (AV) applications. The highly integrated solutions are ready-to-ship, or ready to customize, making it significantly faster and easier for customers to bring broadcast and professional AV products to market.
Xilinx and autonomous driving collaboration partner Motovis powered a demonstration of Omnivision’s 8 megapixel (MP)-based forward looking automotive camera system, an industry first. The live proof-of-concept demonstration highlighted the increased range and wider field of view enabled in the higher resolution 8MP system.
The recently announced Zynq RFSoC DFE and the T1 Telco Accelerator Card, key products for the Wired and Wireless end markets, are now in production with strong interest in both products and significant deployments for RFSoC DFE.


Commentary on AMD Transaction

As announced on October 27, 2020, Advanced Micro Devices, Inc. (AMD) intends to acquire Xilinx in an all-stock transaction. Due to the pending acquisition, Xilinx will not hold an earnings conference call or provide forward-looking guidance. As permitted by the terms of the Merger Agreement between Xilinx and AMD, the Xilinx Board of Directors has declared a cash dividend of $0.37 per outstanding share of common stock. The dividend is conditioned upon and will only be payable if the merger has not closed on or before the record date for such dividend. Xilinx’s stock repurchase program remains suspended. As previously announced, the parties believe that the transaction will close in the first quarter of 2022.


Non-GAAP Financial Information

Fiscal third quarter 2022 results include financial measures which are not determined in accordance with the United States generally accepted accounting principles (GAAP), as indicated. Non-GAAP measures should not be considered as a substitute for, or superior to, financial measures determined in accordance with GAAP. The presentation of non-GAAP financial measures has been reconciled, in each case, to the most directly comparable GAAP measure, as indicated in the accompanying tables. Xilinx’s (the Company) calculation of such non-GAAP measures may not be comparable to similarly-titled measures used by other companies.

Management uses the non-GAAP financial measures disclosed herein, other than free cash flow, to evaluate the Company's financial results from continuing operations (excluding the impact of acquisitions) and compare to operating performance in past periods. Similarly, Management believes presentation of these non-GAAP measures is useful to investors because it enables investors and analysts to evaluate operating expenses of the Company's core business, excluding the impact of non-core business expenses, such as acquisition-related amortization and non-recurring items, as described below:

M&A related expenses: These expenses mainly consist of legal, advisory and consulting fees associated with acquisition activities, and also include fees and retention compensation related to the Company’s acquisition by AMD. The Company believes these costs do not reflect its current operating performance.




Amortization of acquisition-related intangibles: Amortization of acquisition-related intangible assets consists of amortization of intangible assets such as developed technology acquired in connection with business combinations. The non-GAAP adjustments exclude these charges to facilitate an evaluation of the Company’s current operating performance and comparisons to its past operating performance.

Income taxes: The Company excludes the income tax effects of non-GAAP adjustments reflected in operating expenses and other income, as detailed above. It also excludes other significant tax effects of post-acquisition tax integration transactions. The Company believes excluding post-acquisition tax integration items will facilitate a comparable evaluation of its current performance to its past performance.

In addition, free cash flow, which is cash flow from operations adjusted to exclude additions to software, property, plant, and equipment, is used by management when assessing the Company’s sources of liquidity, capital resources, and quality of earnings. The Company believes that this non-GAAP financial measure is helpful in understanding the Company’s capital requirements and provides an additional means to evaluate the cash flow trends of the Company’s business.

Forward-Looking Statements

This release contains forward-looking statements, which 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 uncertain events or assumptions also identify forward-looking statements. Such forward-looking statements include, but are not limited to, statements related to our proposed acquisition by AMD, the semiconductor market, the growth and acceptance of our products, expected revenue growth, the demand and growth in the markets we serve, and opportunity for expansion into new markets. Undue reliance should not be placed on such forward-looking statements, 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, among others, the impact of the ongoing COVID-19 pandemic and related mitigation measures (which, in addition to presenting its own risks and uncertainties, may also heighten the other risks and uncertainties faced by our business and decrease our visibility into all aspects of our business); closing of the proposed transaction with AMD on anticipated timing (including the risk that the conditions to the transaction are not satisfied on a timely basis or at all or the failure of the transaction to close for any other reason) and terms (including obtaining the anticipated tax treatment, regulatory approvals, required consents or authorizations); unanticipated difficulties or expenditures relating to the transaction; the response of business partners and retention as a result of the announcement and pendency of the transaction; the diversion of management time on transaction-related matters; customer acceptance of our new products; changing global economic conditions; our dependence on certain customers; trade and export restrictions; the condition and performance 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; our reliance on third parties (including distributors); variability in wafer pricing; costs and liabilities associated with current and future litigation (including litigation relating to the proposed transaction with AMD); our ability to generate cost and operating expense savings in an efficient and timely manner; our ability to realize the goals contemplated by our acquisitions and strategic investments; the impact of current and future legislative and regulatory changes; the impact of new accounting pronouncements and tax laws, including the U.S. Tax Cuts and Jobs Act, and interpretations thereof; and other risk factors described in our most recent Forms 10-Q and 10-K and subsequent filings with the U.S. Securities and Exchange Commission.




About Xilinx

Xilinx, Inc. develops highly flexible and adaptive computing platforms that enable rapid innovation across a variety of technologies - from the cloud, to the edge, to the endpoint. Xilinx is the inventor of the FPGA and Adaptive SoCs (including our Adaptive Compute Acceleration Platform, or ACAP), designed to deliver the most dynamic computing technology in the industry. We collaborate with our customers to create scalable, differentiated and intelligent solutions that enable the adaptable, intelligent and connected world of the future. For more information, visit xilinx.com.

Xilinx, the Xilinx logo, Alveo, Artix, Kintex, Spartan, Versal, Vitis, Virtex, Vivado, Zynq, Kria and other designated brands included herein are trademarks of Xilinx in the United States and/or 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 EndedNine Months Ended
January 1, 2022October 2, 2021January 2, 2021January 1, 2022January 2, 2021
Net revenues$1,011,059 $935,770 $803,404 $2,825,434 $2,296,612 
Cost of revenues:
Cost of products sold275,479 293,327 249,529 852,247 693,753 
Amortization of acquisition-related intangibles10,059 10,150 6,875 29,275 20,268 
Total cost of revenues285,538 303,477 256,404 881,522 714,021 
Gross margin725,521 632,293 547,000 1,943,912 1,582,591 
Operating expenses:
Research and development287,969 253,881 235,018 789,824 664,776 
Selling, general and administrative125,438 126,319 136,701 376,678 355,877 
Amortization of acquisition-related intangibles2,000 2,252 2,856 7,093 8,581 
Total operating expenses415,407 382,452 374,575 1,173,595 1,029,234 
Operating income310,114 249,841 172,425 770,317 553,357 
Interest and other income (expense), net25,260 (9,204)3,709 17,057 (19,215)
Income before income taxes335,374 240,637 176,134 787,374 534,142 
Provision for income taxes35,312 6,092 5,162 46,426 75,517 
Net income$300,062 $234,545 $170,972 $740,948 $458,625 
Net income per common share:
Basic$1.21 $0.95 $0.70 $3.00 $1.88 
Diluted$1.19 $0.94 $0.69 $2.96 $1.86 
Cash dividends per common share$0.37 $— $0.38 $0.37 $1.14 
Shares used in per share calculations:
Basic248,003 247,765 245,145 246,744 243,976 
Diluted251,971 250,457 248,148 250,448 246,786 

















XILINX, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
January 1, 2022April 03, 2021*
 (unaudited) 
ASSETS
Current assets:
  Cash, cash equivalents and short-term investments$3,702,041 $3,078,899 
  Accounts receivable, net439,397 285,214 
  Inventories331,071 311,085 
  Other current assets57,352 71,064 
Total current assets4,529,861 3,746,262 
Net property, plant and equipment328,202 345,023 
Other assets1,487,378 1,427,916 
Total Assets$6,345,441 $5,519,201 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
 Accounts payable and accrued liabilities$135,382 $116,046 
 Accrued and other liabilities549,095 508,509 
Total current liabilities684,477 624,555 
Long-term debt1,493,623 1,492,688 
Other long-term liabilities493,031 514,997 
Stockholders' equity3,674,310 2,886,961 
Total Liabilities and Stockholders' Equity$6,345,441 $5,519,201 
* Fiscal 2021 balances are derived from audited financial statements.
























XILINX, INC.
SUPPLEMENTAL FINANCIAL INFORMATION
(Unaudited)
(In thousands)
Three Months EndedNine Months Ended
January 1, 2022October 2, 2021January 2, 2021January 1, 2022January 2, 2021
SELECTED CASH FLOW INFORMATION:
Depreciation and amortization of software$30,407 $30,908 $30,818 $93,507 $92,816 
Amortization - others17,821 18,565 17,133 54,332 47,508 
Stock-based compensation73,442 69,720 66,331 210,771 175,153 
Net cash provided by operating activities362,263 122,117 360,137 874,277 853,191 
Purchases of property, plant and equipment and software11,429 14,959 6,009 43,574 36,801 
Payment of dividends to stockholders91,716 — 93,155 91,716 278,674 
Repurchases of common stock— — — — 53,682 
Taxes paid related to net share settlement of restricted stock units, net of proceeds from issuance of common stock(154)59,344 4,560 63,295 37,871 
STOCK-BASED COMPENSATION INCLUDED IN:
Cost of revenues$3,829 $3,797 $3,465 $11,236 $9,149 
Research and development45,323 42,273 40,228 129,057 106,707 
Selling, general and administrative24,290 23,650 22,638 70,478 59,297 































XILINX, INC.
XILINX, INC.
RECONCILIATIONS OF GAAP ACTUALS TO NON-GAAP ACTUALS
(Unaudited)
(In thousands, except per share amounts)
Three Months EndedNine Months Ended
January 1, 2022October 2, 2021January 2, 2021January 1, 2022January 2, 2021
GAAP gross margin$725,521 $632,293 $547,000 $1,943,912 $1,582,591 
M&A related expenses754 1,249 114 2,936 114 
Amortization of acquisition-related intangibles10,059 10,150 6,875 29,275 20,268 
Non-GAAP gross margin$736,334 $643,692 $553,989 $1,976,123 $1,602,973 
GAAP operating income$310,114 $249,841 $172,425 $770,317 $553,357 
Amortization of acquisition-related intangibles12,059 12,402 9,731 36,368 28,849 
M&A related expenses17,721 25,905 19,150 67,384 22,219 
Non-GAAP operating income$339,894 $288,148 $201,306 $874,069 $604,425 
GAAP net income$300,062 234,545 $170,972 $740,948 $458,625 
Amortization of acquisition-related intangibles12,059 12,402 9,731 36,368 28,849 
M&A related expenses17,721 25,905 19,150 67,384 22,219 
Income tax effect of tax-related items— — (528)— 56,273 
Income tax effect of non-GAAP adjustments(5,341)(7,021)(5,100)(18,621)(8,160)
Non-GAAP net income$324,501 $265,831 $194,225 $826,079 $557,806 
GAAP diluted EPS$1.19 $0.94 $0.69 $2.96 $1.86 
Amortization of acquisition-related intangibles0.05 0.05 0.04 0.15 0.12 
Acquisition-related costs0.07 0.10 0.07 0.26 0.08 
Income tax effect of tax-related items— — — — 0.23 
Income tax effect of non-GAAP adjustments(0.02)(0.03)(0.02)(0.07)(0.03)
Non-GAAP diluted EPS$1.29 $1.06 $0.78 $3.30 $2.26 
GAAP cash flow from operations$362,263 $122,117 $360,137 $874,277 $853,191 
Capital expenditures (including software)(11,429)(14,959)(6,009)(43,574)(36,801)
Free cash flow$350,834 $107,158 $354,128 $830,703 $816,390 











UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (date of earliest event reported): January 26, 2022
XILINX, INC.
(Exact name of registrant as specified in its charter)
Delaware
000-18548
77-0188631
(State or other jurisdiction of
incorporation)
(Commission File
Number)
(IRS Employer
Identification No.)
2100 Logic Drive,
San Jose,

California95124
(Address of principal executive offices)(Zip Code)
Registrant’s telephone number, including area code: (408) 559-7778

 (Former name or former address, if changed since last report: N/A)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:

Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, $0.01 par value
XLNX
The Nasdaq Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange
Act.
 



Item 2.02 Results of Operations and Financial Condition
On October 27, 2021, Xilinx, Inc. (the "Company") issued a press release announcing results for the fiscal quarter ended October 2, 2021. A copy of this press release is furnished as Exhibit 99.1 to this report.

Item 9.01 Financial Statements and Exhibits

(d)Exhibits
Exhibit No.  Description
99.1   Press release of Xilinx, Inc. dated January 26, 2022
104 Cover Page Interactive Data File (the Cover Page XBRL tags are embedded within the Inline XBRL document)


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 hereunto duly authorized.
 
  XILINX, INC.
Date: January 26, 2022   By: /s/ Brice Hill
   Brice Hill
   Executive Vice President and Chief Financial Officer


EXHIBIT INDEX
 
Exhibit No.  Description
99.1   
104 Cover Page Interactive Data File (the Cover Page XBRL tags are embedded within the Inline XBRL document)


 

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Ticker: XLNX
CIK: 743988
Form Type: 8-K Corporate News
Accession Number: 0000743988-22-000004
Submitted to the SEC: Wed Jan 26 2022 4:32:57 PM EST
Accepted by the SEC: Wed Jan 26 2022
Period: Wednesday, January 26, 2022
Industry: Semiconductors And Related Devices
Events:
  1. Earnings Release

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