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Xilinx Reports Record Revenues Exceeding $3 Billion For Fiscal 2019

Fiscal fourth quarter revenues up 30% year over year

Apr 24, 2019

SAN JOSE, Calif., April 24, 2019 /PRNewswire/ -- Xilinx, Inc. (Nasdaq: XLNX) today announced record revenues of $3.06 billion for fiscal year 2019, up 24% from the prior fiscal year. Revenues were $828 million for the fourth quarter of fiscal year 2019, up 4% from the prior quarter and up 30% year over year.

GAAP net income for fiscal year 2019 was $890 million, or $3.47 per diluted share.  Non-GAAP net income for fiscal year 2019 was $892 million, or $3.48 per diluted share. GAAP net income for the March quarter was $245 million, or $0.95 per diluted share.  Non-GAAP net income for the March quarter was $242 million, or $0.94 per diluted share. 

The Xilinx Board of Directors declared a quarterly cash dividend of $0.37 per outstanding share of common stock payable on June 3, 2019 to all stockholders of record at the close of business on May 16, 2019.  

Additional fourth quarter of fiscal year 2019 comparisons are provided in the charts below. Due to the adoption of the new revenue recognition standard in the first quarter of fiscal year 2019, all 2018 results have been restated to conform with the new standard.

Q4 2019 Financial Highlights

 

(In millions, except EPS)     

 
   
   

GAAP

 
                 
   

Q4

Q3

Q4

       
   

FY 2019

FY 2019

FY 2018

 

Q-T-Q

Y-T-Y

 

Net Revenues*

$828

$800

$638

 

4%

30%

 

Operating income

$250

$258

$163

 

-3%

53%

 

Net income

$245

$239

$145

 

2%

68%

 

Diluted earnings per share

$0.95

$0.93

$0.56

 

2%

70%

 
                 
   

Non-GAAP

 
                 
   

Q4

Q3

Q4

       
   

FY 2019

FY 2019

FY 2018

 

Q-T-Q

Y-T-Y

 

Net Revenues*

$828

$800

$638

 

4%

30%

 

Operating income

$259

$263

$197

 

-2%

31%

 

Net income

$242

$237

$181

 

2%

34%

 

Diluted earnings per share

$0.94

$0.92

$0.70

 

2%

34%

 
 

* No adjustment between GAAP and Non-GAAP

"Fiscal year 2019 was truly an exceptional year for Xilinx. For the year, we exceeded $3 billion in annual revenues for the first time and posted 24% growth from last year, driven by Advanced Product revenues which grew 40% year over year.  In addition, we demonstrated strong profitability by posting over 30% growth in both non-GAAP operating income and non-GAAP diluted earnings per share. We are executing to our strategy and focusing on growth across our portfolio as we continue our transformation to a platform company," said Victor Peng, president and chief executive officer, Xilinx.

Net Revenues by Geography:

 
 

Percentages

 

Growth Rates

 
 

Q4

Q3

Q4

       

FY 2019

FY 2019

FY 2018

Q-T-Q

Y-T-Y

 

North America

27%

28%

31%

 

-3%

13%

 

Asia Pacific

47%

46%

39%

 

6%

56%

 

Europe

18%

18%

22%

 

7%

12%

 

Japan

8%

8%

8%

 

7%

20%

 
               
                 

Net Revenues by End Market:

               
           
 

Percentages

 

Growth Rates

 
 

Q4

Q3

Q4

     

FY 2019

FY 2019

FY 2018

Q-T-Q

Y-T-Y

 

Communications

41%

35%

31%

 

23%

74%

 

Data Center and TME

18%

21%

25%

 

-12%

-7%

 

Automotive, Broadcast and Consumer

14%

15%

15%

 

-6%

20%

 

Industrial, Aerospace & Defense

27%

27%

35%

 

2%

1%

 

Channel

0%

2%

-6%

 

NM

NM

 
                 
                 

Net Revenues by Product:

 

               
 

Percentages

 

Growth Rates

 
 

Q4

Q3

Q4

     

FY 2019

FY 2019

FY 2018

Q-T-Q

Y-T-Y

 

Advanced Products

68%

66%

57%

 

8%

55%

 

Core Products

32%

34%

43%

 

-4%

-4%

 

Products are classified as follows:

Advanced Products: Alveo, 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)

 
 

Q4

FY 2019

Q3

FY 2019

Q4

FY 2018

       

Annual Return on Equity (%)*

34

34

19

       

Operating Cash Flow

$288

$314

$242

       

Depreciation Expense (including software amortization)

$22

$18

$16

       

Capital Expenditures (including software)

$28

$20

$21

       

Combined Inventory Days

112

109

117

       

Revenue Turns (%)

35

40

33

 

*Return on equity calculation: Annualized year to date GAAP net income/average stockholders' equity

Product and Financial Highlights – Fiscal Year 2019  

  • Driven by 5G, Communications revenues increased 34% compared to last fiscal year. Wireless strength resulted from momentum across both radio and baseband applications with OEM customers; especially due to 5G deployment in South Korea and preparation for 5G deployment in China. During the year, Xilinx and Samsung jointly enabled the world's first 5G NR commercial deployment. Xilinx also expanded its breakthrough RFSoC portfolio to the full sub-6GHz spectrum support that is required for 5G.
  • Data Center and Test, Measurement & Emulation (TME) revenues grew double digits during fiscal year 2019, driven by the Data Center business which grew 40%. During the fiscal year, Xilinx demonstrated strong design-win momentum across hyperscalers, enterprise customers and partners and increased the cumulative number of Xilinx ISV partners to over 500. Xilinx continued to enable key Xilinx platform and Alveo partners through its corporate venture initiatives, doubling ecosystems investments year over year to more than 20 portfolio companies addressing key applications in a variety of areas including data analytics, financial computing and video streaming acceleration.
    Continuing on this path, Xilinx announced today that it has entered into a definitive agreement to acquire Solarflare Communications, a leading provider of high-performance, low latency networking solutions for customers spanning FinTech to cloud computing, further accelerating its "Data Center First" strategy. This acquisition will enable Xilinx to combine its industry leading FPGA, MPSoC and ACAP solutions with Solarflare's high-speed network interface card (NIC) technology and Onload application acceleration software, to enable a new converged SmartNIC platform.
  • Xilinx Automotive business grew double digits reflecting the Company's leading and growing position in Advanced Driver Assist Systems (ADAS). During the fiscal year, Daimler showcased its AI solution in the new Mercedes GLE Sport Utility Vehicle that is powered by Xilinx products. In addition, ZF Friedrichshafen AG, a global leader and Tier-1 automotive supplier announced a strategic collaboration in which Xilinx technology will power its highly advanced AI-based automotive control unit to enable automated driving applications. Further, BYD in China started mass production of front-camera ADAS technology using Xilinx SoCs.
  • Industrial, Aerospace & Defense as well as Automotive, Broadcast and Consumer primary end markets grew to new sales records, with each market supported by a robust and diversified portfolio. Industrial, Aerospace & Defense strength was driven primarily by Industrial growing double digits. Revenues from Automotive, Broadcast and Consumer were driven by double digit growth from each of the businesses.

Business Outlook – Fiscal First Quarter 2020  

The following guidance is  based on current expectations and estimates, and as indicated, are presented on a GAAP and non-GAAP basis. This guidance is forward-looking and actual results may differ materially, as a result of, among other things, the important factors discussed at the end of this release.  

 

GAAP

Non-GAAP
Adjustments

Non-GAAP

Revenues

$835M - $865M

-

$835M - $865M

Gross Margin

~66%

-

~66%

Operating Expenses

~$315M

$7M (1)

~$308M

Other Income

 ~$15M

-

 ~$15M

Tax Rate

     7% - 9%

-

   7% -9%

   

(1)

Includes an estimated $7 million in M&A related expenses and amortization of acquisition related intangibles

Conference Call

A conference call will be held today at 2:00 p.m. Pacific Time to discuss the March quarter financial results and management's outlook for the June quarter. The webcast and subsequent replay will be available in the investor relations section of the Company's web site at 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 7974619 . The telephonic replay will be available for two weeks following the live call. 

Non-GAAP Financial Information

Fiscal fourth quarter 2019 results and business outlook for the June quarter include financial measures which are not determined in accordance with the United States generally accepted accounting principles (GAAP), as indicated.  Non-GAAP measures should not be considered as a substitute for, or superior to, financial measures determined in accordance with GAAP. The presentation of non-GAAP financial measures has been reconciled, in each case, to the most directly-comparable GAAP measure, as indicated in the accompanying tables. The Company's calculation of such non-GAAP measures may not be comparable to similarly-titled measures used by other companies.

Management uses the non-GAAP financial measures disclosed herein to evaluate the Company's financial results from continuing operations (excluding the impact of acquisitions) and compare to operating performance in past periods.  Similarly, Management believes presentation of these non-GAAP measures is useful to investors because it enables investors and analysts to evaluate operating expenses of the Company's core business, excluding the impact of non-core business expenses such as acquisition-related amortization and non-recurring items.

M&A related expenses: These expenses mainly consist of legal and consulting fees associated with acquisition activities.  We believe these costs do not reflect the Company's current operating performance. Consequently, the non-GAAP adjustments exclude these charges to facilitate an evaluation of the Company's current operating performance and comparisons to its past operating performance.

Amortization of acquisition-related intangibles:  Amortization of acquisition-related intangible assets consists of amortization of intangible assets such as developed technology acquired in connection with business combinations. The non-GAAP adjustments exclude these charges to facilitate an evaluation of the Company's current operating performance and comparisons to its past operating performance.

Gains on investment related to acquisition: The Company excludes the accounting gain resulting from revaluation of its prior minority investment in DeePhi Tech.  The Company believes excluding this gain will facilitate a comparable evaluation of its current operating performance to its past operating performance.

Executive transition costs: The Company excludes the costs associated with the executive transition that took place in the fourth quarter of fiscal 2018, which primarily consisted of stock-based compensation and severance payments.  The Company believes the exclusion of such costs will facilitate a comparable evaluation of its current operating performance to its past operating performance.

Income taxes: The Company excludes the income tax effects of non-GAAP adjustments reflected in Operating Expenses and Other Income, as detailed above.  It also excludes U.S. tax reform related items.  The Company believes excluding U.S. tax reform related items will facilitate a comparable evaluation of its current performance to its past performance.  The first quarter of fiscal 2020 outlook does not reflect other tax related items which we are not able to predict without unreasonable efforts due to their inherent uncertainty.

Forward Looking Statements

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 June quarter.  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, among others, 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, our ability to realize the goals contemplated by our acquisitions and strategic investments, the impact of current and future legislative and regulatory changes, the impact of new accounting pronouncements and tax laws, including the U.S. Tax Cuts and Jobs Act, and interpretations thereof, and other risk factors described in our most recent Forms 10-Q and 10-K.

About Xilinx

Xilinx develops highly flexible and adaptive processing platforms that enable rapid innovation across a variety of technologies – from the endpoint to the edge to the cloud. Xilinx is the inventor of the FPGA, hardware programmable SoCs and the ACAP, designed to deliver the most dynamic processor technology in the industry and enable the adaptable, intelligent and connected world of the future. For more information, visit www.xilinx.com.

Xilinx, the Xilinx logo, Artix, ISE, Kintex, Spartan, Virtex, Zynq, Vivado, Alveo, Versal 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

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

XILINX, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(In thousands, except per share amounts)

 

Three Months Ended

 

Twelve Months Ended

 

March 30, 2019

 

December 29, 2018

 

March 31, 2018*

 

March 30, 2019

 

March 31, 2018*

Net revenues

$             828,361

 

$                   800,057

 

$               638,191

 

$          3,059,040

 

$            2,467,023

Cost of revenues

269,457

 

247,903

 

188,941

 

955,868

 

743,419

Gross margin

558,904

 

552,154

 

449,250

 

2,103,172

 

1,723,604

Operating expenses:

                 

Research and development

199,500

 

189,329

 

162,483

 

743,027

 

639,750

Selling, general and administrative

107,160

 

103,039

 

89,348

 

398,416

 

362,329

Amortization of acquisition-related intangibles

1,866

 

1,866

 

584

 

4,930

 

2,152

Executive transition costs

 

 

33,351

 

 

33,351

Total operating expenses

308,526

 

294,234

 

285,766

 

1,146,373

 

1,037,582

Operating income

250,378

 

257,920

 

163,484

 

956,799

 

686,022

Interest and other income (expense), net

9,302

 

(1,330)

 

(3,781)

 

11,533

 

5,357

Income before income taxes

259,680

 

256,590

 

159,703

 

968,332

 

691,379

Provision for income taxes

15,040

 

17,230

 

14,232

 

78,582

 

227,398

Net income

$             244,640

 

239,360

 

$               145,471

 

$             889,750

 

$               463,981

Net income per common share:

                 

Basic

$                   0.96

 

$                         0.95

 

$                     0.57

 

$                   3.52

 

$                     1.86

Diluted

$                   0.95

 

$                         0.93

 

$                     0.56

 

$                   3.47

 

$                     1.80

Cash dividends per common share

$                   0.36

 

$                         0.36

 

$                     0.35

 

$                   1.44

 

$                     1.40

Shares used in per share calculations:

                 

Basic

253,855

 

253,060

 

254,559

 

252,762

 

249,595

Diluted

258,177

 

256,374

 

257,916

 

256,434

 

257,960

 

* Fiscal 2018 balances have been restated to conform to the new revenue recognition standard (ASC 606).

 

 

XILINX, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

 

March 30, 2019

 

March 31, 2018*

 

(unaudited)

   

ASSETS

     

Current assets:

     

Cash, cash equivalents and short-term investments

$          3,175,684

 

$            3,447,570

Accounts receivable, net

335,165

 

382,246

Inventories

315,358

 

236,077

Other current assets

65,771

 

88,695

Total current assets

3,891,978

 

4,154,588

Net property, plant and equipment

328,929

 

304,117

Long-term investments

53,433

 

97,896

Other assets

877,008

 

503,946

Total assets

$          5,151,348

 

$            5,060,547

       
       

LIABILITIES AND STOCKHOLDERS' EQUITY

     

Current liabilities:

     

Accounts payable and accrued liabilities

$             475,036

 

$               412,759

Current portion of long-term debt

 

499,186

Total current liabilities

475,036

 

911,945

Long-term debt

1,234,807

 

1,214,440

Other long-term liabilities

579,996

 

573,809

Stockholders' equity

2,861,509

 

2,360,353

Total Liabilities and Stockholders' Equity

$          5,151,348

 

$            5,060,547

 

* Fiscal 2018 balances have been restated to conform to the new revenue recognition standard (ASC 606).

 

XILINX, INC.

SUPPLEMENTAL FINANCIAL INFORMATION

(Unaudited)

(In thousands)

 

Three Months Ended

 

Twelve Months Ended

 

March 30, 2019

 

December 29, 2018

 

March 31, 2018

 

March 30, 2019

 

March 31, 2018

SELECTED CASH FLOW INFORMATION:

                 

Depreciation and amortization of software

$               21,607

 

$                     17,974

 

$               15,756

 

$               70,704

 

$               50,172

Amortization

10,195

 

7,984

 

33,963

 

33,656

 

46,582

Stock-based compensation

38,748

 

38,641

 

48,606

 

147,942

 

153,815

Net cash provided by operating activities

288,007

 

313,917

 

242,293

 

1,091,215

 

820,027

Purchases of property, plant ,equipment and software

28,242

 

20,270

 

20,978

 

89,045

 

49,918

Payment of dividends to stockholders

91,384

 

91,108

 

89,302

 

364,244

 

353,053

Repayment of debt

500,000

 

 

 

500,000

 

457,918

Repurchases of common stock

 

1,015

 

163,448

 

161,551

 

474,254

                   

STOCK-BASED COMPENSATION INCLUDED IN:

                 

Cost of revenues

$                 2,170

 

$                       2,366

 

$                 2,006

 

$                 8,820

 

$                 8,492

Research and development

23,099

 

22,352

 

19,011

 

86,428

 

76,790

Selling, general and administrative

13,479

 

13,923

 

10,968

 

52,694

 

51,912

Executive transition costs

 

 

16,621

 

 

16,621

 

XILINX, INC.

RECONCILIATIONS OF GAAP ACTUALS TO NON-GAAP ACTUALS

(Unaudited)

(In thousands, except per share amounts)

 

Three Months Ended

 

Twelve Months Ended

 

March 30, 2019

 

December 29, 2018

 

March 31, 2018*

 

March 30, 2019

 

March 31, 2018*

GAAP operating income

$             250,378

 

$                   257,920

 

$               163,484

 

$             956,799

 

$               686,022

Acquisition-related costs

6,560

 

3,208

 

 

13,469

 

Amortization of acquisition-related intangibles

1,866

 

1,866

 

584

 

4,930

 

2,152

Executive transition costs

 

 

33,351

 

 

33,351

Non-GAAP operating income

$             258,804

 

$                   262,994

 

$               197,419

 

$             975,198

 

$               721,525

                   

GAAP net income

$             244,640

 

$                   239,360

 

$               145,471

 

$             889,750

 

$               463,981

Acquisition-related costs

6,560

 

3,208

 

 

13,469

 

Amortization of acquisition-related intangibles

1,866

 

1,866

 

584

 

4,930

 

2,152

Executive transition costs

 

 

33,351

 

 

33,351

Gain from private investments

 

 

 

(6,503)

 

Income tax effect of changes in applicable U.S. tax laws

(8,508)

 

(6,949)

 

11,623

 

(6,100)

 

190,503

Income tax effect of non-GAAP adjustments

(2,330)

 

(559)

 

(10,045)

 

(3,050)

 

(10,045)

Non-GAAP net income

$             242,228

 

$                   236,926

 

$               180,984

 

$             892,496

 

$               679,942

                   

GAAP diluted EPS

$                   0.95

 

$                         0.93

 

$                     0.56

 

$                   3.47

 

$                     1.80

Acquisition-related costs

0.02

 

0.01

 

 

0.05

 

Amortization of acquisition-related intangibles

0.01

 

0.01

 

 

0.02

 

0.01

Executive transition costs

 

 

0.13

 

 

0.13

Gain from private investments

 

 

 

(0.03)

 

Income tax effect of changes in applicable U.S. tax laws

(0.03)

 

(0.03)

 

0.05

 

(0.02)

 

0.74

Income tax effect of non-GAAP adjustments

(0.01)

 

 

(0.04)

 

(0.01)

 

(0.04)

Non-GAAP diluted EPS

$                   0.94

 

$                         0.92

 

$                     0.70

 

$                   3.48

 

$                     2.64

 

* Fiscal 2018 balances have been restated to conform to the new revenue recognition standard (ASC 606).

 

 

SOURCE Xilinx, Inc.

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