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Xilinx Announces Second Quarter 2018 Results; Eighth Consecutive Quarter Of Revenue Growth

Oct 25, 2017

SAN JOSE, Calif., Oct. 25, 2017 /PRNewswire/ -- Xilinx, Inc. (Nasdaq: XLNX) today announced sales of $620 million for the second quarter of fiscal year 2018, up approximately 1% from the prior quarter and up 7% from the second quarter of the prior fiscal year. This marks the eighth consecutive quarter of sales increase for the Company.  September quarter net income was $168 million, or $0.65 per diluted share.

The Xilinx Board of Directors declared a quarterly cash dividend of $0.35 per outstanding share of common stock payable on December 6, 2017 to all stockholders of record at the close of business on November 15, 2017.  

Additional September quarter comparisons are represented in the charts below:

GAAP Results

(In millions, except EPS)    

 
 

Q2
FY 2018

Q1

FY 2018

Q2

FY 2017

 

 

Q-T-Q

 

Y-T-Y

Net revenues

$620

$615

$579

 

1%

7%

Operating income

$185

$180

$177

 

3%

5%

Net income

$168

$167

$164

 

0%

2%

Diluted earnings per share

$0.65

$0.63

$0.61

 

3%

7%

"Our multimarket diversification, technology leadership, and consistent execution are yielding sustainable results as we delivered our eighth consecutive quarter of revenue growth with strong profitability," said Moshe Gavrielov, Xilinx President and Chief Executive Officer. "Revenues from Advanced Products continued to be solid, increasing 21% from the same quarter a year ago, supported by accelerated growth from our highly innovative Zynq SoC platform, as well as from our industry-leading 20nm and 16nm technology nodes. At the 16nm technology node, we have shipped 34 unique products to well over 900 customers, denoting a sequential increase of 50% in the number of products and 75% increase in the number of customers."

Net Revenues by Geography:

 
 

Percentages

 

Growth Rates

 

Q2

FY 2018

Q1

FY 2018

Q2

FY 2017

 

 

Q-T-Q

 

Y-T-Y

North America

31%

29%

33%

 

8%

1%

Asia Pacific

40%

43%

38%

 

-7%

12%

Europe

20%

19%

20%

 

2%

4%

Japan

9%

9%

9%

 

8%

14%

 

Net Revenues by End Market:

 
 

Percentages

 

Growth Rates

 

Q2

FY 2018

Q1

FY 2018

Q2

FY 2017

 

 

Q-T-Q

 

Y-T-Y

Communications & Data Center

37%

41%

41%

 

-10%

-5%

Industrial, Aerospace & Defense

45%

42%

41%

 

7%

17%

Broadcast, Consumer & Automotive

18%

17%

18%

 

11%

12%

 

Net Revenues by Product:

       
 

Percentages

 

Growth Rates

 

Q2

FY 2018

Q1

FY 2018

Q2

FY 2017

 

 

Q-T-Q

 

Y-T-Y

Advanced Products

52%

52%

46%

 

1%

21%

Core Products

48%

48%

54%

 

1%

-5%

Products are classified as follows:

Advanced Products: UltraScale+, Ultrascale and 7-series products.
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)

 
 

Q2

FY 2018

Q1

FY 2018

Q2

FY 2017

       

Annual Return on Equity (%)*

27

27

25

       

Operating Cash Flow

$202

$191

$184

       

Depreciation Expense

$12

$11

$11

       

Capital Expenditures

$12

$10

$11

       

Combined Inventory Days

116

111

111

       

Revenue Turns (%)

53

42

55

 

*Return on equity calculation: Annualized net income/average stockholders' equity

 

Product and Financial Highlights – September Quarter

  • The Industrial, Aerospace & Defense end market set a quarterly record with revenues of $278 million, an increase of 17% from the same quarter a year ago, and constituted 45% of total Xilinx revenues. The success of this end market is a clear illustration of the robustness and diversification of the Xilinx product portfolio.
  • The Advanced Products category continues to deliver solid revenue growth, posting an increase of 21% from the year ago quarter. Broad-based growth was driven from the Zynq SoC platform and from the industry-leading 20nm and 16nm technology nodes. Zynq revenue increased 65% from the same quarter a year ago with growth driven largely by applications in Advanced Driver Assist (ADAS), Industrial, and Aerospace and Defense. Revenues from the 20nm node increased more than 40% from the year ago quarter and revenues from the 16nm node nearly quadrupled during the same period, reflecting broader customer and multi-market adoption.
  • Xilinx made several significant announcements highlighting strong momentum in its Cloud Computing market expansion opportunity. Xilinx announced availability of the software defined development environment, SDAccel, on Amazon Web Services (AWS) for use with F1 instances. In addition, Xilinx announced that Huawei has chosen the Company's high performance Virtex® UltraScale+™ FPGAs to power their first FaaS instance as part of a new accelerated cloud service. Lastly, Alibaba Cloud, the largest cloud service provider in China, recently announced its next generation FaaS F2 and F3 instances, based on Xilinx FPGAs.  
  • Xilinx, ARM, Cadence and TSMC announced a collaboration to build the first Cache Coherent Interconnect for Accelerators (CCIX) test chip in TSMC 7nm FinFET process technology for delivery in year 2018. The test chip aims to provide a silicon proof point to demonstrate the capabilities of CCIX in enabling multi-core high-performance ARM® CPUs working via a coherent fabric to off-chip FPGA accelerators.
  • Xilinx announced delivery of its Zynq® UltraScale+™ RFSoC family, a disruptive integration and architectural breakthrough for applications including 5G, cable and wireless backhaul. Based on Xilinx's 16nm technology, the RFSoCs integrate RF data converters for up to 50-75% system power and footprint reduction. With silicon samples already shipping to multiple customers, the early access program for this product family is now available. 

Business Outlook – December Quarter Fiscal Year 2018

  • Sales are expected to be approximately $615 - $645 million.
  • Gross margin is expected to be 69% to 71%.
  • Operating expenses are expected to increase to approximately $260 million.
  • Other income is expected to be approximately $4 million.
  • December quarter tax rate is expected to be approximately 11 - 14%.

Conference Call

A conference call will be held today at 2:00 p.m. Pacific Time to discuss the September quarter financial results and management's outlook for the December quarter. The webcast and subsequent replay will be available in the investor relations section of the Company's web site at www.investor.xilinx.com.  A telephonic replay of the call may be accessed later in the day by calling (855) 859-2056 and referencing confirmation code 80382363. The telephonic replay will be available for two weeks following the live call. 

This release contains forward-looking statements and projections. Forward-looking statements and projections 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 projections, uncertain events or assumptions also identify forward-looking statements.  Such forward looking statements include, but are not limited to, statements related to the semiconductor market, the growth and acceptance of our products, expected revenue growth, the demand and growth in the markets we serve, opportunity for expansion into new markets, and our expectations regarding our business outlook for the December quarter of fiscal year 2018.  Undue reliance should not be placed on such forward-looking statements and projections, 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 customer acceptance of our new products, current global economic conditions, the health 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, variability in wafer pricing, costs and liabilities associated with current and future litigation, and other risk factors listed in our most recent Forms 10-Q and 10-K.

About Xilinx

Xilinx is the leading provider of All Programmable FPGAs, SoCs, MPSoCs, and 3D ICs. Xilinx uniquely enables applications that are both software defined and hardware optimized – powering industry advancements in Cloud Computing, Embedded Vision, Industrial IoT, and 5G Wireless. For more information, visit www.xilinx.com.

#1725F

Xilinx, the Xilinx logo, Artix, ISE, Kintex, Spartan, Virtex, Zynq, Vivado, and other designated brands included herein are trademarks of Xilinx in the United States and 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 Ended

 

Six Months Ended

 

September 30, 2017

 

July 1, 2017

 

October 1, 2016

 

September 30, 2017

 

October 1, 2016

Net revenues

$                    619,503

 

$      615,446

 

$             579,209

 

$                 1,234,949

 

$          1,154,190

Cost of revenues

184,786

 

192,095

 

175,875

 

376,881

 

344,172

Gross margin

434,717

 

423,351

 

403,334

 

858,068

 

810,018

Operating expenses:

                 

Research and development

157,985

 

153,051

 

141,814

 

311,036

 

277,939

Selling, general and administrative

91,053

 

89,175

 

83,463

 

180,228

 

166,573

Amortization of acquisition-related intangibles

510

 

705

 

1,244

 

1,215

 

2,488

Total operating expenses

249,548

 

242,931

 

226,521

 

492,479

 

447,000

Operating income

185,169

 

180,420

 

176,813

 

365,589

 

363,018

Interest and other income (expense), net

1,831

 

1,839

 

(1,151)

 

3,669

 

(5,738)

Income before income taxes

187,000

 

182,259

 

175,662

 

369,258

 

357,280

Provision for income taxes

19,468

 

15,014

 

11,470

 

34,481

 

30,039

Net income

$                    167,532

 

$      167,245

 

$             164,192

 

$                    334,777

 

$             327,241

Net income per common share:

                 

Basic

$                          0.68

 

$            0.67

 

$                   0.65

 

$                          1.35

 

$                   1.29

Diluted

$                          0.65

 

$            0.63

 

$                   0.61

 

$                          1.28

 

$                   1.22

Cash dividends per common share

$                          0.35

 

$            0.35

 

$                   0.33

 

$                          0.70

 

$                   0.66

Shares used in per share calculations:

                 

Basic

248,094

 

247,911

 

253,466

 

247,960

 

253,056

Diluted

258,217

 

265,797

 

270,373

 

261,739

 

267,885

 

XILINX, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

 

September 30, 2017

 

April 1, 2017*

 

(unaudited)

   

ASSETS

     

Current assets:

     

  Cash, cash equivalents and short-term investments

$               3,560,220

 

$     3,321,457

  Accounts receivable, net

286,855

 

243,915

  Inventories

215,397

 

227,033

  Other current assets

109,758

 

87,711

Total current assets

4,172,230

 

3,880,116

Net property, plant and equipment

304,118

 

303,825

Long-term investments

99,862

 

116,288

Other assets

454,640

 

440,303

Total Assets

$               5,030,850

 

$     4,740,532

       
       

LIABILITIES AND STOCKHOLDERS' EQUITY

     

Current liabilities:

     

  Accounts payable and accrued liabilities

$                  372,255

 

$        386,301

  Deferred income on shipments to distributors

50,966

 

54,567

  Current portion of long-term debt

 

456,328

Total current liabilities

423,221

 

897,196

Long-term debt

1,738,666

 

995,247

Deferred tax liabilities

359,323

 

317,639

Other long-term liabilities

23,557

 

21,411

Temporary equity

 

1,406

Stockholders' equity

2,486,083

 

2,507,633

Total Liabilities and Stockholders' Equity

$               5,030,850

 

$     4,740,532

       
       

* Derived from audited financial statements

 

XILINX, INC.

 

SUPPLEMENTAL FINANCIAL INFORMATION

 

(Unaudited)

 

(In thousands)

 
 

Three Months Ended

 

Six Months Ended

 

September 30, 2017

 

July 1, 2017

 

October 1, 2016

 

September 30, 2017

 

October 1, 2016

 

SELECTED CASH FLOW INFORMATION:

                   

   Depreciation

$                      11,732

 

$        11,232

 

$               11,182

 

$                      22,964

 

$               22,807

 

   Amortization

3,432

 

3,729

 

4,001

 

7,161

 

7,714

 

   Stock-based compensation

36,372

 

32,036

 

29,802

 

68,408

 

59,206

 

   Net cash provided by operating activities

202,140

 

190,908

 

183,593

 

393,048

 

522,229

 

   Purchases of property, plant and equipment

12,223

 

9,926

 

11,313

 

22,149

 

31,950

 

   Payment of dividends to stockholders

86,957

 

87,303

 

83,878

 

174,260

 

167,477

 

   Repurchases of common stock

170,454

 

67,062

 

99,985

 

237,516

 

200,139

 

   Net proceeds (withholding) from issuance of 

                   

     common stock to employees

(23,765)

 

1,070

 

(1,784)

 

(22,695)

 

9,513

 
                     

STOCK-BASED COMPENSATION INCLUDED IN:

                   

  Cost of revenues

$                        2,147

 

$          2,150

 

$                 1,930

 

$                        4,297

 

$                 4,049

 

  Research and development

20,096

 

17,466

 

16,529

 

37,562

 

31,649

 

  Selling, general and administrative

14,129

 

12,420

 

11,343

 

26,549

 

23,508

 

 

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

 

 

SOURCE Xilinx, Inc.

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