Cypress Reports Fourth Quarter and Year End 2017 Results

(a) Our net sales for twelve months ended 2016 include $18.75 million, of legacy Spansion non-GAAP licensing revenue in MPD, APAC region and direct channel, respectively.


Table G: Margin %	Three Months Ended
	Q4'17						Q3'17						Q4'16
	GAAP			Non-GAAP			GAAP			Non-GAAP			GAAP			Non-GAAP
Revenue (See Table F) [i]	$	597,547		$	597,547		$	604,574		$	604,574		$	530,172		$	530,172
Cost of revenues (See Table A, B, C) [ii]	331,143			326,220			351,969			344,565			328,220			317,594
Margin [iii] [ii - i]	$	266,404		$	271,327		$	252,605		$	260,009		$	201,952		$	212,578
Margin % [iii / i]	44.6		%	45.4		%	41.8		%	43.0		%	38.1		%	40.1		%

Table H: Margin %	Twelve Months Ended
	Q4'17						Q4'16
	GAAP			Non-GAAP			GAAP			Non-GAAP
Revenue (See Table A) [i]	$	2,327,771		$	2,327,771		$	1,923,108		$	1,941,858
Cost of revenues (See Table D, E) [ii]	1,373,520			1,345,009			1,237,974			1,185,129
Margin [iii] [ii - i]	$	954,251		$	982,762		$	685,134		$	756,729
Margin % [iii / i]	41.0		%	42.2		%	35.6		%	39.0		%

Table I: Operating income (loss)	Three Months Ended							Twelve Months Ended
	Q4'17		Q3'17		Q4'16			Q4'17		Q4'16
GAAP operating income (loss) [i]	$	39,710	$	39,097	$	(38,376	)	$	65,359	$	(611,755	)
Impact of reconciling items on Revenue (see Table F)	—		—		—			—		18,750
Impact of reconciling items on Cost of revenues (see Table A, B, C, D, E)	4,923		7,404		10,626			28,511		52,845
Impact of reconciling items on R&D (see Tables A, B, C, D, E)	9,332		10,882		17,310			44,323		45,518
Impact of reconciling items on SG&A (see Tables A, B, C, D, E)	17,710		9,014		34,957			54,874		103,713
Impact of Amortization of Intangible Assets (see Tables A, B, C, D, E)	49,224		48,428		52,104			195,255		174,745
Impact of Goodwill impairment charge (see Table E)	—		—		—			—		488,504
Impact of Impairment related to assets held for sale (see Table C, E)	—		—		1,960			—		37,219
Impact of Impairment related to acquisition related intangibles (see Table E)	—		—		—			—		33,944
Costs and settlement charges related to shareholder matter (see Table D)	—		—		—			3,500		—
(Gain) related to investment in Deca Technologies (see Table E)	—		$	—	—			—		(112,774		)
Non-GAAP operating income [ii]	$	120,899	$	114,825	$	78,581		$	391,822	$	230,709
Impact of reconciling items [ii - i]	81,189		75,728		116,957			326,463		842,464

Table J: Pre-tax profit	Three Months Ended								Twelve Months Ended
	Q4'17			Q3'17		Q4'16			Q4'17			Q4'16
GAAP Pre-tax profit	$	(38,783	)	$	15,547	$	(71,531	)	$	(82,364	)	$	(684,278	)
Impact of reconciling items on operating income (see Table I)	81,189			75,728		116,957			326,463			842,464
Interest and other expense, net (see Table A, B, C, D, E)	64,521			10,621		11,675			91,327			24,945
Non-GAAP Pre-tax income	$	106,927		$	101,896	$	57,101		$	335,426		$	183,131

Table K: Net income (loss)	Three Months Ended								Twelve Months Ended
	Q4'17			Q3'17		Q4'16			Q4'17			Q4'16
GAAP Net income (loss)	$	(35,998	)	$	11,033	$	(72,367	)	$	(93,651	)	$	(686,251	)
Impact of reconciling items on Operating income (see Table I)	81,189			75,728		116,957			326,463			842,464
Interest and other expense, net (see Table A, B, C, D, E)	64,521			10,621		11,675			91,327			24,945
Income tax (provision) benefit (see Table A, B, C, D, E)	(5,027		)	1,598		(2,442		)	118			(10,687		)
Non-GAAP Net income	$	104,685		$	98,980	$	53,823		$	324,257		$	170,471

Table L: Pretax profit margin %	Three Months Ended
	Q4'17						Q3'17						Q4'16
	GAAP			Non-GAAP			GAAP			Non-GAAP			GAAP			Non-GAAP
Revenue (See Table F) [i]	$	597,547		$	597,547		$	604,574		$	604,574		$	530,172		$	530,172
Pre-tax profit (see Table J) [ii]	$	(38,783	)	$	106,927		$	15,547		$	101,896		(71,531		)	57,101
Pre-tax profit margin % [ii / i]	(6.5		)%	17.9		%	2.6		%	16.9		%	(13.5		)%	10.8		%

Table M: Pretax profit margin %	Twelve Months Ended
	Q4'17						Q4'16
	GAAP			Non-GAAP			GAAP			Non-GAAP
Revenue (See Table F) [i]	$	2,327,771		$	2,327,771		$	1,923,108		$	1,941,858
Pre-tax profit (see Table J) [ii]	$	(82,364	)	$	335,426		$	(684,278	)	$	183,131
Pre-tax profit margin % [ii / i]	(3.5		)%	14.4		%	(35.6		)%	9.4		%

Table N: Weighted-average shares, diluted

Three Months Ended

Q4'17

Q3'17

Q4'16

GAAP

Non-GAAP

GAAP

Non-GAAP

GAAP

Non-GAAP

Weighted-average common shares outstanding, basic

343,011

332,873

322,800

Effect of dilutive securities:

Stock options, unvested restricted stock and other

—

14,003

7,884

12,948

—

17,199

Impact of convertible bond

—

12,110

19,554

18,790

—

15,138

Weighted-average common shares outstanding, diluted

343,011

369,124

360,311

364,611

322,800

355,137

Table O: Weighted-average shares, diluted	Twelve Months Ended
	Q4'17		Q4'16
	GAAP	Non-GAAP	GAAP	Non-GAAP
Weighted-average common shares outstanding, basic	333,451	333,451	319,522	319,522
Effect of dilutive securities:
Stock options, unvested restricted stock and other	—	14,838	—	15,370
Impact of convertible bond	—	16,851	—	15,138
Weighted-average common shares outstanding, diluted	333,451	365,140	319,522	350,030

Table P: Net income (loss) Per Share	Three Months Ended
	Q4'17					Q3'17				Q4'16
	GAAP			Non-GAAP		GAAP		Non-GAAP		GAAP			Non-GAAP
Net income (loss) (see Table K)	$	(35,998	)	$	104,685	$	11,033	$	98,980	$	(72,367	)	$	53,823
Weighted-average common shares outstanding (see Table N) [ii]	343,011			369,124		360,311		364,611		322,800			355,137
Non-GAAP earnings per share - Diluted [i/ii]	$	(0.10	)	$	0.28	$	0.03	$	0.27	$	(0.22	)	$	0.15

Table Q: Net income (loss) Per Share	Twelve Months Ended
	Q4'17					Q4'16
	GAAP			Non-GAAP		GAAP			Non-GAAP
Net income (loss) (see Table K)	$	(93,651	)	$	324,257	$	(686,251	)	$	170,471
Weighted-average common shares outstanding (see Table O) [ii]	333,451			365,140		319,522			350,030
Non-GAAP earnings per share - Diluted [i/ii]	$	(0.28	)	$	0.89	$	(2.15	)	$	0.49

Table R: Earnings before Interest, Taxes, Depreciation and Amortization ("EBITDA")	Three Months Ended							Twelve Months Ended
	Q4'17		Q3'17		Q4'16			Q4'17		Q4'16
GAAP operating income (loss) (See Table I)	$	39,710	$	39,097	$	(38,376	)	$	65,359	$	(611,755	)
Impact of reconciling items on Operating income (see Table I)	81,189		75,728		116,957			326,463		842,464
Non-GAAP operating income	$	120,899	$	114,825	$	78,581		$	391,822	$	230,709
GAAP depreciation	18,701		16,674		16,057			67,578		89,464
Merger-related depreciation	—		—		—			—		(13,964		)
Non-GAAP EBITDA	$	139,600	$	131,499	$	94,638		$	459,400	$	306,209

CYPRESS SEMICONDUCTOR CORPORATION SUPPLEMENTAL FINANCIAL DATA (In thousands except financial ratios and per share amounts) (Unaudited)

	Three Months Ended									Twelve Months Ended
	December 31, 2017			October 1, 2017			January 1, 2017			December 31, 2017			January 1, 2017
Selected Cash Flow Data (Preliminary):
Net cash provided by operating activities	$	201,541		$	143,778		$	89,787		$	403,487		$	217,419
Net cash used in investing activities	$	(6,036	)	$	(15,051	)	$	(19,008	)	$	(14,429	)	$	(613,439	)
Net cash (used in) provided by financing activities	$	(175,472	)	$	(105,935	)	$	(37,262	)	$	(357,634	)	$	289,502
Other Supplemental Data (Preliminary):
Capital expenditures	$	7,790		$	17,144		$	11,889		$	54,284		$	57,398
Depreciation	$	18,701		$	16,674		$	16,057		$	67,578		$	89,464
Payment of dividend	$	36,670		$	36,325		$	35,350		$	144,749		$	141,410
Dividend paid per share	$	0.11		$	0.11		$	0.11		$	0.44		$	0.44
Total debt (principal amount)	$	1,061,414		$	1,204,240		$	1,309,017		$	1,061,414		$	1,309,017
Leverage ratio ¹	2.31			2.91			4.27			2.31			4.27

1. Total debt (principal amount) / Last 12 months Non-GAAP EBITDA (Table R)

CYPRESS SEMICONDUCTOR CORPORATION RECONCILIATION OF GAAP FORWARDING LOOKING ESTIMATES TO NON-GAAP FORWARD LOOKING ESTIMATES

	Forward looking GAAP estimate (A)	Adjustments (B)												Forward looking Non- GAAP estimate (C)=(A)+(B)
		Amortization of intangibles			Share-based compensation expense			Restructuring			Other items
Margin %	43.0% - 44.0%	—		%	0.6		%	—		%	0.7		%	44.5% - 45.5%
Diluted earnings per share	$(0.03) to $0.01	$	0.15		$	0.07		$	0.02		$	0.01		$0.22 to $0.26

« Previous Page 1 | 2 | 3 | 4 | 5 | 6 | 7 Next Page »