** Diluted share count can vary as a result of, among other things, the actual exercise of options or vesting of restricted stock units, the incremental dilutive shares from the Company's convertible senior subordinated notes, and the repurchase or the issuance of stock or convertible notes or the sale of treasury shares. In periods in which the quarterly average stock price per share exceeds $18.50, the non-GAAP diluted share count and non-GAAP net income per share includes the impact of the Company’s hedge transactions issued concurrently with our 1.00% convertible notes. As such, at an average stock price per share between $18.50 and $25.96, the hedging activity offsets the potentially dilutive effect of the 1.00% convertible notes. In periods when the quarterly average stock price per share exceeds $20.72, the non-GAAP diluted share count and non-GAAP net income per share includes the anti-dilutive impact of the Company’s hedge transactions issued concurrently with the 1.625% convertible notes. As such, at an average stock price per share between $20.72 and $30.70, the hedging activity offsets the potentially dilutive effect of the 1.625% convertible notes. Both GAAP and non-GAAP diluted share counts are based on the Company’s current stock price.
*** Special items may include: amortization of acquisition-related intangibles; expensing of appraised inventory fair market value step-up; purchased in-process research and development expenses; restructuring, asset impairments and other, net; goodwill impairment charges; gains and losses on debt prepayment; non-cash interest expense; actuarial (gains) losses on pension plans and other pension benefits; and certain other special items, as necessary. These special items are out of our control and could change significantly from period to period. As a result, we are not able to reasonably estimate and separately present the individual impact of these special items, and we are similarly unable to provide a reconciliation of the non-GAAP measures. The reconciliation that is unavailable would include a forward looking income statement, balance sheet and statement of cash flows in accordance with GAAP. For this reason, we use a projected range of the aggregate amount of special items in order to calculate our projected non-GAAP operating expense outlook.
**** We believe these non-GAAP measures provide important supplemental information to investors. We use these measures, together with GAAP measures, for internal managerial purposes and as a means to evaluate period-to-period comparisons. However, we do not, and you should not, rely on non-GAAP financial measures alone as measures of our performance. We believe that non-GAAP financial measures reflect an additional way of viewing aspects of our operations that, when taken together with GAAP results and the reconciliations to corresponding GAAP financial measures that we also provide in our releases, provide a more complete understanding of factors and trends affecting our business. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures, even if they have similar names.
TELECONFERENCE
ON Semiconductor will host a conference call for the financial community at 9 a.m. Eastern Time (EST) on Feb. 5, 2018, to discuss this announcement and ON Semiconductor’s results for the fourth quarter of 2017 and year then ended. The Company will also provide a real-time audio webcast of the teleconference on the Investor Relations page of its website at http://www.onsemi.com. The webcast replay will be available at this site approximately one hour following the live broadcast and will continue to be available for approximately 30 days following the conference call. Investors and interested parties can also access the conference call through a telephone call by dialing (877) 356-3762 (U.S./Canada) or (262) 558-6155 (International). In order to join this conference call, you will be required to provide the Conference ID Number, which is 1175039.
About ON Semiconductor
ON Semiconductor (Nasdaq: ON) is driving energy efficient innovations, empowering customers to reduce global energy use. The company is a leading supplier of semiconductor-based solutions, offering a comprehensive portfolio of energy efficient power management, analog, sensors, logic, timing, connectivity, discrete, SoC and custom devices. The company’s products help engineers solve their unique design challenges in automotive, communications, computing, consumer, industrial, medical, aerospace and defense applications. ON Semiconductor operates a responsive, reliable, world-class supply chain and quality program, a robust compliance and ethics program, and a network of manufacturing facilities, sales offices and design centers in key markets throughout North America, Europe and the Asia Pacific regions. For more information, visit http://www.onsemi.com.
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ON Semiconductor and the ON Semiconductor logo are registered trademarks of Semiconductor Components Industries, LLC. All other brand and product names appearing in this document are registered trademarks or trademarks of their respective holders. Although the Company references its website in this news release, information on the website is not to be incorporated herein.
This document contains forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. All statements,
other than statements of historical facts, included or incorporated in
this document could be deemed forward-looking statements, particularly
statements about the future financial performance of ON Semiconductor,
including financial guidance for the year ending December 31, 2018.
Forward-looking statements are often characterized by the use of words
such as “believes,” “estimates,” “expects,” “projects,” “may,” “will,”
“intends,” “plans” or “anticipates,” or by discussions of strategy,
plans or intentions. All forward-looking statements in this document are
made based on our current expectations, forecasts, estimates and
assumptions and involve risks, uncertainties and other factors that
could cause results or events to differ materially from those expressed
in the forward-looking statements. Among these factors are our revenues
and operating performance; economic conditions and markets (including
current financial conditions); effects of exchange rate fluctuations;
the cyclical nature of the semiconductor industry; changes in demand for
our products, changes in inventories at our customers and distributors,
technological and product development risks; enforcement and protection
of our IP rights and related risks; risks related to the security of our
information systems and secured network; availability of raw materials,
electricity, gas, water and other supply chain uncertainties; our
ability to effectively shift production to other facilities when
required in order to maintain supply continuity for our customers;
variable demand and the aggressive pricing environment for semiconductor
products; our ability to successfully manufacture in increasing volumes
on a cost-effective basis and with acceptable quality for our current
products; legislative, regulatory and economic developments; competitor
actions, including the adverse impact of competitor product
announcements; pricing and gross profit pressures; loss of key
customers; order cancellations or reduced bookings; changes in
manufacturing yields; control of costs and expenses and realization of
cost savings and synergies from restructurings; significant litigation;
risks associated with decisions to expend cash reserves for various uses
in accordance with our capital allocation policy such as debt
prepayment, stock repurchases or acquisitions rather than to retain such
cash for future needs; risks associated with acquisitions and
dispositions (including from integrating and consolidating and timely
filing financial information with the SEC for acquired businesses and
difficulties encountered in accurately predicting the future financial
performance of acquired businesses); risks associated with our
substantial leverage and restrictive covenants in our debt agreements
that may be in place from time to time; risks associated with our
worldwide operations, including foreign employment and labor matters
associated with unions and collective bargaining arrangements, as well
as man-made and/or natural disasters affecting our operations and
finances/financials; the threat or occurrence of international armed
conflict and terrorist activities both in the United States and
internationally; risks and costs associated with increased and new
regulation of corporate governance and disclosure standards; risks
related to new legal requirements, including laws, rules and regulations
related to taxes and, in particular, the impact of the recently adopted
tax reform legislation; risks involving environmental or other
governmental regulation; and risks associated with our acquisition of
Fairchild Semiconductor International Inc. ("Fairchild"), including: (1)
intellectual property litigation matters relating to Fairchild; (2) our
ability to retain key personnel; (3) competitive responses to the
transaction; (4) unexpected costs, charges or expenses resulting from
the transaction; (5) adverse reactions or changes to business
relationships resulting from the transaction; (6) our ability to realize
the benefits of the acquisition of Fairchild; (7) delays, challenges and
expenses associated with integrating the businesses; and (8) our ability
to comply with the terms of the indebtedness incurred in connection with
the transaction. Additional factors that could affect our future results
or events are described under Part I, Item 1A “Risk Factors” in our 2016
Annual Report on Form 10-K filed with the SEC on February 28, 2017
("2016 Form 10-K") and from time-to-time in our other SEC reports. You
should carefully consider the trends, risks and uncertainties described
in this document, our 2016 Form 10-K, Part I, Item IA of our Form 10-Q
for the quarter ended September 30, 2017 and other reports filed with or
furnished to the SEC before making any investment decision with respect
to our securities. If any of these trends, risks or uncertainties
actually occurs or continues, our business, financial condition or
operating results could be materially adversely affected, the trading
prices of our securities could decline, and you could lose all or part
of your investment. Readers are cautioned not to place undue reliance on
forward-looking statements. We assume no obligation to update such
information except as may be required by law. All forward-looking
statements attributable to us or persons acting on our behalf are
expressly qualified in their entirety by this cautionary statement.
