IDT Reports Q3 Fiscal Year 2015 Financial Results



INTEGRATED DEVICE TECHNOLOGY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share data)
	Three Months Ended									Nine Months Ended
	Dec. 28,			Sept. 28,			Dec. 29,			Dec. 28,			Dec. 29,
		2014			2014			2013			2014			2013
Revenues	$	151,160		$	137,093		$	124,628		$	414,555		$	366,139
Cost of revenues		59,796			55,217			49,689			167,306			154,317
Gross profit		91,364			81,876			74,939			247,249			211,822
Operating expenses:
Research and development		32,825			30,742			31,063			95,617			107,939
Selling, general and administrative		27,165			26,795			23,687			79,419			77,826
Total operating expenses		59,990			57,537			54,750			175,036			185,765

Operating income		31,374			24,339			20,189			72,213			26,057

Gain (loss) from divestiture		-			-			(3,415	)		-			78,934
Other income, net		1,558			405			1,108			2,825			1,921
Income from continuing operations before income taxes		32,932			24,744			17,882			75,038			106,912
Provision for income taxes		91			498			543			840			661

Net income from continuing operations		32,841			24,246			17,339			74,198			106,251

Discontinued operations:
Gain from divestiture		-			-			-			16,840			-
Loss from discontinued operations		(14,538	)		(9,747	)		(10,123	)		(36,438	)		(17,922	)
Provision for (benefit from) income taxes		(55	)		57			268			(43	)		(6	)
Net loss from discontinued operations		(14,483	)		(9,804	)		(10,391	)		(19,555	)		(17,916	)

Net income	$	18,358		$	14,442		$	6,948		$	54,643		$	88,335

Basic net income per share - continuing operations	$	0.22		$	0.16		$	0.11		$	0.50		$	0.71
Basic net loss per share - discontinued operations		(0.10	)		(0.06	)		(0.06	)		(0.13	)		(0.12	)
Basic net income per share	$	0.12		$	0.10		$	0.05		$	0.37		$	0.59

Diluted net income per share - continuing operations	$	0.21		$	0.16		$	0.11		$	0.48		$	0.70
Diluted net loss per share - discontinued operations		(0.09	)		(0.07	)		(0.07	)		(0.12	)		(0.12	)
Diluted net income per share	$	0.12		$	0.09		$	0.04		$	0.36		$	0.58

Weighted average shares:
Basic		148,552			148,683			151,018			148,844			148,835
Diluted		153,973			153,784			155,035			153,904			152,560



INTEGRATED DEVICE TECHNOLOGY, INC.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (a)
(Unaudited)
(In thousands, except per share data)
	Three Months Ended									Nine Months Ended
	Dec. 28,			Sept. 28,			Dec. 29,			Dec. 28,			Dec. 29,
		2014			2014			2013			2014			2013

GAAP net income from continuing operations	$	32,841		$	24,246		$	17,339		$	74,198		$	106,251
GAAP diluted net income per share continuing operations	$	0.21		$	0.16		$	0.11		$	0.48		$	0.70
Acquisition related:
Amortization of acquisition related intangibles		1,347			1,676			3,322			5,572			9,965
Acquisition related legal and consulting fees		(125	)		-			21			(125	)		729
Restructuring related:
Severance and retention costs		129			319			400			974			6,073
Facility closure costs		209			20			6			276			27
Loss (gain) from divestiture		-			-			3,415			-			(78,934	)
Assets impairment and other		-			401			(151	)		2,703			3,893
Other:
Stock-based compensation expense		5,878			5,929			3,169			16,769			10,309
Gain from divestiture		(104	)		-			-			(104	)		-
Assets impairment and other		-			-			(114	)		-			(114	)
Compensation expense (benefit) - deferred compensation plan		525			(242	)		557			777			1,080
(Gain) loss on deferred compensation plan securities		(500	)		245			(627	)		(735	)		(1,145	)
Tax effects of Non-GAAP adjustments		(1,521	)		(826	)		(1,402	)		(3,206	)		(3,058	)
Non-GAAP net income from continuing operations	$	38,679		$	31,768		$	25,935		$	97,099		$	55,076
GAAP weighted average shares - diluted		153,973			153,784			155,035			153,904			152,560
Non-GAAP adjustment		1,463			2,128			2,099			1,802			2,659
Non-GAAP weighted average shares - diluted		155,436			155,912			157,134			155,706			155,219
Non-GAAP diluted net income per share continuing operations	$	0.25		$	0.20		$	0.17		$	0.62		$	0.35

GAAP gross profit	$	91,364		$	81,876		$	74,939		$	247,249		$	211,822
Acquisition related:
Amortization of acquisition related intangibles		959			1,264			2,435			3,909			7,305
Restructuring related:
Severance and retention costs		(96	)		96			-			23			87
Facility closure costs		-			-			2			-			8
Assets impairment and other		-			334			(28	)		2,269			(102	)
Other:
Assets impairment and other		-			-			(114	)		-			(114	)
Compensation expense (benefit) - deferred compensation plan		156			(70	)		172			233			333
Stock-based compensation expense		592			436			403			1,347			1,128
Non-GAAP gross profit	$	92,975		$	83,936		$	77,809		$	255,030		$	220,467

GAAP R&D expenses:	$	32,825		$	30,742		$	31,063		$	95,617		$	107,939
Restructuring related:
Severance and retention costs		(91	)		(136	)		(86	)		(467	)		(3,929	)
Facility closure costs		(209	)		-			(2	)		(209	)		(9	)
Assets impairment and other		-			(67	)		-			(434	)		-
Other:
Assets impairment and other		-			-			123			-			(3,995	)
Compensation expense (benefit) - deferred compensation plan		(255	)		114			(289	)		(381	)		(560	)
Stock-based compensation expense		(2,562	)		(2,464	)		(1,514	)		(7,547	)		(4,212	)
Non-GAAP R&D expenses	$	29,708		$	28,189		$	29,295		$	86,579		$	95,234

GAAP SG&A expenses:	$	27,165		$	26,795		$	23,687		$	79,419		$	77,826
Acquisition related:
Amortization of acquisition related intangibles		(388	)		(412	)		(887	)		(1,663	)		(2,660	)
Acquisition related legal and consulting fees		125			-			(21	)		125			(729	)
Restructuring related:
Severance and retention costs		(134	)		(87	)		(314	)		(484	)		(2,057	)
Facility closure costs		-			(20	)		(2	)		(67	)		(10	)
Other:
Compensation expense (benefit) - deferred compensation plan		(114	)		58			(96	)		(163	)		(187	)
Stock-based compensation expense		(2,724	)		(3,029	)		(1,252	)		(7,875	)		(4,969	)
Non-GAAP SG&A expenses	$	23,930		$	23,305		$	21,115		$	69,292		$	67,214

GAAP interest income and other, net	$	1,558		$	405		$	1,108		$	2,825		$	1,921
Gain from divestiture		(104	)		-			-			(104	)		-
(Gain) loss on deferred compensation plan securities		(500	)		245			(627	)		(735	)		(1,145	)
Non-GAAP interest income and other, net	$	954		$	650		$	481		$	1,986		$	776

GAAP provision for income taxes - continuing operations	$	91		$	498		$	543		$	840		$	661
Tax effects of Non-GAAP adjustments		1,521			826			1,402			3,206			3,058
Non-GAAP provision for income taxes - continuing operations	$	1,612		$	1,324		$	1,945		$	4,046		$	3,719


(a) Refer to the accompanying “Notes to Non-GAAP Financial Measures” for a detailed discussion of management’s use of non-GAAP financial measures.



INTEGRATED DEVICE TECHNOLOGY, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)

	Dec. 28,		March 30,
(In thousands)		2014		2014

ASSETS
Current assets:
Cash and cash equivalents	$	127,787	$	91,211
Short-term investments		383,566		362,604
Accounts receivable, net		76,294		68,904
Inventories		40,945		49,622
Prepaid and other current assets		15,203		13,034
Total current assets		643,795		585,375

Property, plant and equipment, net		64,744		69,827
Goodwill		135,644		135,644
Acquisition-related intangibles		6,535		18,741
Other assets		26,556		21,373
TOTAL ASSETS	$	877,274	$	830,960

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	26,043	$	25,442
Accrued compensation and related expenses		37,949		24,343
Deferred income on shipments to distributors		15,244		14,006
Deferred taxes liabilities		1,396		1,346
Other accrued liabilities		22,385		11,525
Total current liabilities		103,017		76,662

Deferred tax liabilities		1,494		1,494
Long term income taxes payable		353		266
Other long-term obligations		18,469		18,683
Total liabilities		123,333		97,105

Stockholders' equity		753,941		733,855

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	877,274	$	830,960

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