| RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES | |||||||||||||||||||||||
| (In millions, except per share data) (Unaudited) | |||||||||||||||||||||||
| Three Months Ended | |||||||||||||||||||||||
|
June 27,
2020 |
March 28,
2020 |
June 29,
2019 | |||||||||||||||||||||
| GAAP gross margin | $ | 848 | $ | 818 | $ | 621 | |||||||||||||||||
| GAAP gross margin % | 44 % | 46 % | 41 % | ||||||||||||||||||||
| Stock-based compensation | 2 | 2 | 2 | ||||||||||||||||||||
| Non-GAAP gross margin | $ | 850 | $ | 820 | $ | 623 | |||||||||||||||||
| Non-GAAP gross margin % | 44 % | 46 % | 41 % | ||||||||||||||||||||
| GAAP operating expenses | $ | 675 | $ | 641 | $ | 562 | |||||||||||||||||
| GAAP operating expenses/revenue % | 35 % | 36 % | 37 % | ||||||||||||||||||||
| Stock-based compensation | 58 | 57 | 43 | ||||||||||||||||||||
| Loss contingency on legal matter | - | - | 7 | ||||||||||||||||||||
| Non-GAAP operating expenses | $ | 617 | $ | 584 | $ | 512 | |||||||||||||||||
| Non-GAAP operating expenses/revenue% | 32 % | 33 % | 33 % | ||||||||||||||||||||
| GAAP operating income | $ | 173 | $ | 177 | $ | 59 | |||||||||||||||||
| GAAP operating margin % | 9 % | 10 % | 4 % | ||||||||||||||||||||
| Stock-based compensation | 60 | 59 | 45 | ||||||||||||||||||||
| Loss contingency on legal matter | - | - | 7 | ||||||||||||||||||||
| Non-GAAP operating income | $ | 233 | $ | 236 | $ | 111 | |||||||||||||||||
| Non-GAAP operating margin % | 12 % | 13 % | 7 % | ||||||||||||||||||||
| Three Months Ended | |||||||||||||||||||||||
|
June 27,
2020 |
March 28,
2020 |
June 29,
2019 | |||||||||||||||||||||
| GAAP net income / earnings per share | $ | 157 | $ | 0.13 | $ | 162 | $ | 0.14 | $ | 35 | $ | 0.03 | |||||||||||
| Non-cash interest expense related to convertible debt | 2 | - | 2 | - | 6 | - | |||||||||||||||||
| Stock-based compensation | 60 | 0.05 | 59 | 0.04 | 45 | 0.04 | |||||||||||||||||
| Equity income in investee | (1 | ) | - | - | - | - | - | ||||||||||||||||
| Loss contingency on legal matter | - | - | - | - | 7 | 0.01 | |||||||||||||||||
| Income tax provision | (2 | ) | - | (1 | ) | - | (1 | ) | - | ||||||||||||||
| Non-GAAP net income / earnings per share | $ | 216 | $ | 0.18 | $ | 222 | $ | 0.18 | $ | 92 | $ | 0.08 | |||||||||||
|
Shares used and net income adjustment in
earnings per share calculation (1) | |||||||||||||||||||||||
| Shares used in per share calculation (GAAP) | 1,227 | 1,224 | 1,109 | ||||||||||||||||||||
| Interest expense add-back to GAAP net income | $ | 3 | $ | 4 | $ | - | |||||||||||||||||
| Shares used in per share calculation (Non-GAAP) | 1,227 | 1,224 | 1,210 | ||||||||||||||||||||
| Interest expense add-back to Non-GAAP net income | $ | 1 | $ | 2 | $ | 5 | |||||||||||||||||
| (1 | ) | For the three months ended June 27, 2020 and March 28, 2020, GAAP diluted EPS calculations include 31 million shares related to the Company's 2026 Convertible Notes and the associated $3 million and $4 million interest expense, respectively, add-back to net income under the "if converted" method.
| |||||||||||||||||||||
| For the three months ended June 29, 2019, the 100.6 million shares related to the Company's 2026 Convertible Notes were not included in the GAAP diluted EPS calculations as their inclusion would have been anti-dilutive. | |||||||||||||||||||||||
| For the three months ended June 27, 2020, March 28, 2020 and June 29, 2019, Non-GAAP diluted EPS calculations include 31 million, 31 million and 100.6 million shares, respectively, related to the Company's 2026 Convertible Notes and the associated $1 million, $2 million and $5 million interest expense, respectively, add-back to net income under the "if converted" method. | |||||||||||||||||||||||
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