Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2018 | Apr. 17, 2018 | |
Document and Entity Information | ||
Entity Registrant Name | SILICON LABORATORIES INC | |
Entity Central Index Key | 1,038,074 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2018 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-29 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 43,231,069 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 30, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 342,272 | $ 269,366 |
Short-term investments | 417,867 | 494,657 |
Accounts receivable, net | 75,122 | 71,367 |
Inventories | 76,505 | 73,132 |
Prepaid expenses and other current assets | 64,555 | 39,120 |
Total current assets | 976,321 | 947,642 |
Property and equipment, net | 129,894 | 127,682 |
Goodwill | 288,227 | 288,227 |
Other intangible assets, net | 76,716 | 83,144 |
Other assets, net | 94,837 | 88,387 |
Total assets | 1,565,995 | 1,535,082 |
Current liabilities: | ||
Accounts payable | 50,068 | 38,851 |
Deferred revenue and returns liability | 25,426 | |
Deferred income on shipments to distributors | 50,115 | |
Other current liabilities | 69,310 | 73,359 |
Total current liabilities | 144,804 | 162,325 |
Convertible debt | 345,049 | 341,879 |
Other non-current liabilities | 75,567 | 77,862 |
Total liabilities | 565,420 | 582,066 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock - $0.0001 par value; 10,000 shares authorized; no shares issued | ||
Common stock - $0.0001 par value; 250,000 shares authorized; 43,227 and 42,707 shares issued and outstanding at March 31, 2018 and December 30, 2017, respectively | 4 | 4 |
Additional paid-in capital | 98,396 | 102,862 |
Retained earnings | 904,160 | 851,307 |
Accumulated other comprehensive loss | (1,985) | (1,157) |
Total stockholders' equity | 1,000,575 | 953,016 |
Total liabilities and stockholders' equity | $ 1,565,995 | $ 1,535,082 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares shares in Thousands | Mar. 31, 2018 | Dec. 30, 2017 |
Condensed Consolidated Balance Sheets | ||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 10,000 | 10,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 250,000 | 250,000 |
Common stock, shares issued | 43,227 | 42,707 |
Common stock, shares outstanding | 43,227 | 42,707 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Condensed Consolidated Statements of Income | ||
Revenues | $ 205,384 | $ 179,028 |
Cost of revenues | 81,147 | 73,867 |
Gross margin | 124,237 | 105,161 |
Operating expenses: | ||
Research and development | 54,828 | 52,324 |
Selling, general and administrative | 45,694 | 40,155 |
Operating expenses | 100,522 | 92,479 |
Operating income | 23,715 | 12,682 |
Other income (expense): | ||
Interest income and other, net | 3,202 | 576 |
Interest expense | (4,883) | 198 |
Income before income taxes | 22,034 | 13,456 |
Provision (benefit) for income taxes | (4,371) | (1,970) |
Net income | $ 26,405 | $ 15,426 |
Earnings per share: | ||
Basic (in dollars per share) | $ 0.61 | $ 0.37 |
Diluted (in dollars per share) | $ 0.60 | $ 0.36 |
Weighted-average common shares outstanding: | ||
Basic (in shares) | 42,963 | 42,096 |
Diluted (in shares) | 43,918 | 43,030 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Condensed Consolidated Statements of Comprehensive Income | ||
Net income | $ 26,405 | $ 15,426 |
Net changes to available-for-sale securities: | ||
Unrealized gain (losses) arising during the period | (757) | 245 |
Reclassification for losses included in net income | 49 | |
Net changes to cash flow hedges: | ||
Unrealized losses arising during the period | (24) | |
Reclassification for gains included in net income | (1,808) | |
Other comprehensive loss, before tax | (732) | (1,563) |
Benefit from income taxes | (154) | (546) |
Other comprehensive loss | (578) | (1,017) |
Comprehensive income | $ 25,827 | $ 14,409 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Operating Activities | ||
Net Income | $ 26,405 | $ 15,426 |
Adjustments to reconcile net income to cash provided by operating activities: | ||
Depreciation of property and equipment | 3,704 | 3,596 |
Amortization of other intangible assets and other assets | 6,427 | 6,752 |
Amortization of debt discount and debt issuance costs | 3,169 | 869 |
Stock-based compensation expense | 12,192 | 10,486 |
Deferred income taxes | (4,780) | (4,059) |
Changes in operating assets and liabilities: | ||
Accounts receivable | (3,307) | (1,252) |
Inventories | (3,368) | (1,636) |
Prepaid expenses and other assets | (17,169) | 6,708 |
Accounts payable | 13,030 | 5,565 |
Other current liabilities and income taxes | (9,463) | (2,944) |
Deferred income, deferred revenue and returns liability | (2,599) | 4,038 |
Other non-current liabilities | (1,849) | (1,536) |
Net cash provided by operating activities | 22,212 | 42,013 |
Investing Activities | ||
Purchases of available-for-sale investments | (52,821) | (267,777) |
Sales and maturities of available-for-sale investments | 128,975 | 25,595 |
Purchases of property and equipment | (4,102) | (4,543) |
Purchases of other assets | (4,698) | (1,446) |
Acquisitions of business, net of cash acquired | (13,658) | |
Net cash provided by (used in) investing activities | 67,354 | (261,829) |
Financing Activities | ||
Proceeds from issuance of long-term debt, net | 390,000 | |
Payments on debt | (72,500) | |
Payment of taxes withheld for vested stock awards | (17,871) | (13,553) |
Proceeds from the issuance of common stock | 1,211 | 162 |
Net cash provided by (used in) financing activities | (16,660) | 304,109 |
Increase in cash and cash equivalents | 72,906 | 84,293 |
Cash and cash equivalents at beginning of period | 269,366 | 141,106 |
Cash and cash equivalents at end of period | $ 342,272 | $ 225,399 |
Significant Accounting Policies
Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2018 | |
Significant Accounting Policies | |
Significant Accounting Policies | 1. Significant Accounting Policies Basis of Presentation and Principles of Consolidation The Condensed Consolidated Financial Statements included herein are unaudited; however, they contain all normal recurring accruals and adjustments which, in the opinion of management, are necessary to present fairly the condensed consolidated financial position of Silicon Laboratories Inc. and its subsidiaries (collectively, the “Company”) at March 31, 2018 and December 30, 2017, the condensed consolidated results of its operations for the three months ended March 31, 2018 and April 1, 2017, the Condensed Consolidated Statements of Comprehensive Income for the three months ended March 31, 2018 and April 1, 2017, and the Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2018 and April 1, 2017. All intercompany balances and transactions have been eliminated in consolidation. The condensed consolidated results of operations for the three months ended March 31, 2018 are not necessarily indicative of the results to be expected for the full year. The accompanying unaudited Condensed Consolidated Financial Statements do not include certain footnotes and financial presentations normally required under U.S. generally accepted accounting principles (GAAP). Therefore, these Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and notes thereto for the year ended December 30, 2017, included in the Company’s Form 10-K filed with the Securities and Exchange Commission (SEC) on January 31, 2018. The Company prepares financial statements on a Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Among the significant estimates affecting the financial statements are those related to inventories, goodwill, acquired intangible assets, investments in auction-rate securities, other long-lived assets, revenue recognition, stock-based compensation and income taxes. Actual results could differ from those estimates, and such differences could be material to the financial statements. Reclassifications Certain reclassifications have been made to prior year financial statements to conform to current year presentation. Adoption of New Revenue Accounting Standard The Company adopted Accounting Standards Codification (ASC) Topic 606, Revenue from Contracts with Customers Financial Statement Line Item Increase (Decrease) Accounts receivable, net $ 230 Prepaid expenses and other current assets $ 7,579 Other assets, net $ (2,282 ) Deferred revenue and returns liability $ 27,806 Deferred income on shipments to distributors $ (50,115 ) Other current liabilities $ 1,641 Retained earnings $ 26,195 The following presents the amounts by which financial statement line items were affected in the current period due to the adoption of ASC 606 (in thousands): Financial Statement Line Item* Increase (Decrease) Condensed Consolidated Statements of Income Three Months Ended Revenues $ 698 Cost of revenues $ (250 ) Net income $ 390 Earnings per share: Basic $ 0.01 Diluted $ 0.01 Condensed Consolidated Balance Sheet** March 31, 2018 Prepaid expenses and other current assets $ 5,425 Other assets, net $ (2,952 ) Deferred revenue and returns liability $ 25,426 Deferred income on shipments to distributors $ (52,051 ) Other current liabilities $ 2,636 Retained earnings $ 26,585 * Excludes line items that were not materially affected by the Company’s adoption of ASC 606. The adoption had no impact to cash provided by or used in net operating, investing or financing activities in the Condensed Consolidated Statements of Cash Flows. ** Balance sheet line item amounts include the The primary impact of the Company’s adoption of ASC 606 resulted from the acceleration of the timing of revenue recognition on sales to distributors. The Company previously deferred revenue and cost of revenue on such sales until the distributors sold the product to the end customers. The Company now recognizes revenue at the time of sale to the distributor provided all other revenue recognition criteria have been met. The Company records a right of return asset and a returns liability in place of the deferred income on shipments to distributors previously recorded under ASC 605. Revenue Recognition Revenue is recognized when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Performance Obligations Substantially all of the Company’s contracts with customers contain a single performance obligation, the sale of mixed-signal integrated circuit (IC) products. Such sales represent a single performance obligation because the sale is one type of good (e.g. an IC) or includes multiple goods that are neither capable of being distinct nor separable from the other promises in the contract (e.g. an IC embedded with software). This performance obligation is satisfied when control of the product is transferred to the customer, which typically occurs upon delivery. Unsatisfied performance obligations primarily represent contracts for products with future delivery dates and with an original expected duration of one year or less. As allowed under ASC 606, the Company has opted to not disclose the amount of unsatisfied performance obligations as these contracts have original expected durations of less than one year. The Company’s products carry a one-year replacement warranty. The replacement warranty promises customers that delivered products are as specified in the contract (an “assurance-type warranty”). Therefore, the Company accounts for such warranties under ASC 460, Guarantees Transaction Price The transaction price reflects the Company’s expectations about the consideration it will be entitled to receive from the customer and may include fixed or variable amounts. Fixed consideration primarily includes sales to direct customers and sales to distributors in which both the sale to the distributor and the sale to the end customer occur within the same reporting period. Variable consideration includes sales in which the amount of consideration that the Company will receive is unknown as of the end of a reporting period. Such consideration primarily includes sales made to distributors under agreements allowing certain rights of return, referred to as stock rotation, and credits issued to the distributor due to price protection. Stock rotation allows distributors limited levels of returns and is based on the distributor’s prior purchases. Price protection represents price discounts granted to certain distributors and is based on negotiations on sales to end customers. The Company estimates variable consideration at the most likely amount to which it expects to be entitled. Included in the transaction price estimate are amounts in which it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. The estimate is based on information available to the Company, including recent sales activity and pricing data. The Company applies a constraint to its variable consideration estimate which considers both the likelihood of a return and the amount of a potential price concession. Variable consideration that does not meet revenue recognition criteria is deferred. The Company records a right of return asset for the costs of distributor inventory not meeting revenue recognition criteria. A corresponding deferred revenue and returns liability is recorded for unrecognized revenue associated with such costs. Contract Balances Accounts receivable represents the Company’s unconditional right to receive consideration from its customer. Payments are typically due within 30 days of invoicing and do not include a significant financing component. To date, there have been no material impairment losses on accounts receivable. There were no material contract assets or contract liabilities recorded on the Condensed Consolidated Balance Sheet in any of the periods presented. Recent Accounting Pronouncements In February 2018, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2018-02, Income Statement—Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. In August 2017, the FASB issued ASU No. 2017-12 , Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. In January 2017, the FASB issued ASU No. 2017-04 , Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share | |
Earnings Per Share | 2. Earnings Per Share The following table sets forth the computation of basic and diluted earnings per share (in thousands, except per share data): Three Months Ended March 31, April 1, Net income $ 26,405 $ 15,426 Shares used in computing basic earnings per share 42,963 42,096 Effect of dilutive securities: Stock options and other stock-based awards 955 934 Shares used in computing diluted earnings per share 43,918 43,030 Earnings per share: Basic $ 0.61 $ 0.37 Diluted $ 0.60 $ 0.36 For the three months ended March 31, 2018 and April 1, 2017, approximately 0.0 million and 0.3 million shares, respectively, consisting of restricted stock awards (RSUs), market stock awards (MSUs) and stock options, were not included in the diluted earnings per share calculation since the shares were anti-dilutive. The Company intends to settle the principal amount of its convertible senior notes in cash and any excess value in shares in the event of a conversion. Accordingly, shares issuable upon conversion of the principal amount have been excluded from the calculation of diluted earnings per share. If the market value of the notes under certain prescribed conditions exceeds the conversion amount, the excess is included in the denominator for the computation of diluted earnings per share using the treasury stock method. As of March 31, 2018, Debt |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2018 | |
Fair Value of Financial Instruments | |
Fair Value of Financial Instruments | 3. Fair Value of Financial Instruments The fair values of the Company’s financial instruments are recorded using a hierarchical disclosure framework based upon the level of subjectivity of the inputs used in measuring assets and liabilities. The three levels are described below: Level 1 - Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. Level 2 - Inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 - Inputs are unobservable for the asset or liability and are developed based on the best information available in the circumstances, which might include the Company’s own data. The following summarizes the valuation of the Company’s financial instruments (in thousands). The tables do not include either cash on hand or assets and liabilities that are measured at historical cost or any basis other than fair value. Fair Value Measurements Description Quoted Prices in Significant Other Significant Total Assets: Cash equivalents: Money market funds $ 111,866 $ — $ — $ 111,866 Corporate debt securities — 9,419 — 9,419 Government debt securities 24,997 — — 24,997 Total cash equivalents $ 136,863 $ 9,419 $ — $ 146,282 Short-term investments: Government debt securities $ 65,239 $ 219,493 $ — $ 284,732 Corporate debt securities — 133,135 — 133,135 Total short-term investments $ 65,239 $ 352,628 $ — $ 417,867 Other assets, net: Auction rate securities $ — $ — $ 5,609 $ 5,609 Total $ — $ — $ 5,609 $ 5,609 Total $ 202,102 $ 362,047 $ 5,609 $ 569,758 Fair Value Measurements Description Quoted Prices in Significant Other Significant Total Assets: Cash equivalents: Money market funds $ 106,047 $ — $ — $ 106,047 Corporate debt securities — 11,231 — 11,231 Government debt securities 53,615 1,453 — 55,068 Total cash equivalents $ 159,662 $ 12,684 $ — $ 172,346 Short-term investments: Government debt securities $ 94,575 $ 228,247 $ — $ 322,822 Corporate debt securities — 171,835 — 171,835 Total short-term investments $ 94,575 $ 400,082 $ — $ 494,657 Other assets, net: Auction rate securities $ — $ — $ 5,681 $ 5,681 Total $ — $ — $ 5,681 $ 5,681 Total $ 254,237 $ 412,766 $ 5,681 $ 672,684 Valuation methodology The Company’s cash equivalents and short-term investments that are classified as Level 2 are valued using non-binding market consensus prices that are corroborated with observable market data; quoted market prices for similar instruments in active markets; or pricing models, such as a discounted cash flow model, with all significant inputs derived from or corroborated with observable market data. Investments classified as Level 3 are valued using a discounted cash flow model. The assumptions used in preparing the discounted cash flow model include estimates for interest rates, amount of cash flows, expected holding periods of the securities and a discount to reflect the Company’s inability to liquidate the securities. The Company’s derivative instruments are valued using discounted cash flow models. The assumptions used in preparing the valuation models include foreign exchange rates, forward and spot prices for currencies, and market observable data of similar instruments. Available-for-sale investments The Company’s investments are reported at fair value, with unrealized gains and losses, net of tax, recorded as a component of accumulated other comprehensive loss in the Consolidated Balance Sheet. The following summarizes the contractual underlying maturities of the Company’s Cost Fair Due in one year or less $ 338,056 $ 337,433 Due after one year through ten years 135,923 134,453 Due after ten years 98,269 97,872 $ 572,248 $ 569,758 The available-for-sale investments that were in a continuous unrealized loss position, aggregated by length of time that individual securities have been in a continuous loss position, were as follows (in thousands): Less Than 12 Months 12 Months or Greater Total As of March 31, 2018 Fair Gross Fair Gross Fair Gross Government debt securities $ 182,320 $ (1,059 ) $ 4,432 $ (10 ) $ 186,752 $ (1,069 ) Corporate debt securities 120,303 (929 ) 11,327 (100 ) 131,630 (1,029 ) Auction rate securities — — 5,609 (391 ) 5,609 (391 ) $ 302,623 $ (1,988 ) $ 21,368 $ (501 ) $ 323,991 $ (2,489 ) Less Than 12 Months 12 Months or Greater Total As of December 30, 2017 Fair Gross Fair Gross Fair Gross Government debt securities $ 244,880 $ (931 ) $ 3,027 $ (15 ) $ 247,907 $ (946 ) Corporate debt securities 151,149 (447 ) 11,578 (73 ) 162,727 (520 ) Auction rate securities — — 5,681 (319 ) 5,681 (319 ) $ 396,029 $ (1,378 ) $ 20,286 $ (407 ) $ 416,315 $ (1,785 ) The gross unrealized losses as of March 31, 2018 and December 30, 2017 were due primarily to changes in market interest rates and the illiquidity of the Company’s auction-rate securities. The Company’s auction-rate securities have been illiquid since 2008 when auctions for the securities failed because sell orders exceeded buy orders. These securities have a contractual maturity date of 2046 at March 31, 2018. The Company considers the declines in market value of its marketable securities investment portfolio to be temporary in nature. When evaluating an investment for other-than-temporary impairment, the Company reviews factors such as the severity and duration of the impairment, changes in underlying credit ratings, forecasted recovery, the Company’s intent to sell or the likelihood that it would be required to sell the investment before its anticipated recovery in market value and the probability that the scheduled cash payments will continue to be made. As of March 31, 2018, the Company has determined that no other-than-temporary impairment losses existed. At March 31, 2018 and December 30, 2017, there were no material unrealized gains associated with the Company’s available-for-sale investments. Level 3 fair value measurements The following summarizes quantitative information about Level 3 fair value measurements. Auction rate securities Fair Value at Valuation Technique Unobservable Input Weighted Average $ 5,609 Discounted cash flow Estimated yield 2.22% Expected holding period 10 years Estimated discount rate 3.63% The Company has followed an established internal control procedure used in valuing auction rate securities. The procedure involves the analysis of valuation techniques and evaluation of unobservable inputs commonly used by market participants to price similar instruments, and which have been demonstrated to provide reasonable estimates of prices obtained in actual market transactions. Outputs from the valuation process are assessed against various market sources when they are available, including marketplace quotes, recent trades of similar illiquid securities, benchmark indices and independent pricing services. The technique and unobservable input parameters may be recalibrated periodically to achieve an appropriate estimation of the fair value of the securities. Significant changes in any of the unobservable inputs used in the fair value measurement of auction rate securities in isolation could result in a significantly lower or higher fair value measurement. An increase in expected yield would result in a higher fair value measurement, whereas an increase in expected holding period or estimated discount rate would result in a lower fair value measurement. Generally, a change in the assumptions used for expected holding period is accompanied by a directionally similar change in the assumptions used for estimated yield and discount rate. The following summarizes the activity in Level 3 financial instruments for the three months ended March 31, 2018 (in thousands): Assets Auction Rate Securities Three Months Beginning balance $ 5,681 Loss included in other comprehensive loss (72 ) Balance at March 31, 2018 $ 5,609 Fair values of other financial instruments The Company’s debt is recorded at cost, but is measured at fair value for disclosure purposes. The fair value of the Company’s convertible senior notes is determined using observable market prices. The notes are traded in less active markets and are therefore classified as a Level 2 fair value measurement. As of March 31, 2018 and December 30, 2017, the fair value of the convertible senior notes was $457.4 million and $466.2 million, respectively. The Company’s other financial instruments, including cash, accounts receivable and accounts payable, are recorded at amounts that approximate their fair values due to their short maturities. |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Mar. 31, 2018 | |
Derivative Financial Instruments | |
Derivative Financial Instruments | 4. Derivative Financial Instruments The Company uses derivative financial instruments to manage certain exposures to the variability of interest rates and foreign currency exchange rates. The Company’s objective is to offset increases and decreases in expenses resulting from these exposures with gains and losses on the derivative contracts, thereby reducing volatility of earnings. Cash Flow Hedges Foreign Currency Forward Contracts The Company uses foreign currency forward contracts to reduce the earnings impact that exchange rate fluctuations have on operating expenses denominated in currencies other than the U.S. dollar. Changes in the fair value of the contracts are recorded in accumulated other comprehensive loss in the Consolidated Balance Sheet and subsequently reclassified into earnings in the period during which the hedged transaction is recognized. The reclassified amount is reported in the same financial statement line item as the hedged item. If the foreign currency forward contracts are terminated or can no longer qualify as hedging instruments prior to maturity, the fair value of the contracts recorded in accumulated other comprehensive loss may be recognized in the Consolidated Statement of Income based on an assessment of the contracts at the time of termination. The Company entered into foreign currency forward contracts in March 2018 for a portion of its forecasted operating expenses denominated in the Norwegian Krone. As of March 31, 2018, the contracts had maturities of one to twelve months and an aggregate notional value of $8.3 million. The fair value of the contracts was not material as of March 31, 2018. Contract losses recognized in other comprehensive income during the three months ended March 31, 2018 as well as losses expected to be reclassified into earnings in the next 12 months were not material. There were no amounts reclassified from accumulated other comprehensive loss into earnings during the three months ended March 31, 2018. Interest Rate Swaps The Company entered into an interest rate swap agreement with an original notional value of $72.5 million in connection with its Credit Facility in July 2016. The Company terminated the swap agreement on March 6, 2017, which r Non-designated Hedges Foreign Currency Forward Contracts The Company uses foreign currency forward contracts to reduce the earnings impact that exchange rate fluctuations have on non-U.S. dollar balance sheet exposures. The Company recognizes gains and losses on the foreign currency forward contracts in interest income and other, net in the Consolidated Statement of Income in the same period as the remeasurement loss and gain of the related foreign currency denominated asset or liability. The Company does not apply hedge accounting to these foreign currency forward contracts. As of March 31, 2018 and April 1, 2017, the Company held one foreign currency forward contract denominated in the Norwegian Krone with a notional value of $2.6 million and $4.0 million, respectively. The fair value of the contracts was not material as of March 31, 2018 or April 1, 2017. The contract held as of March 31, 2018 has The before-tax effect of derivative instruments not designated as hedging instruments was as follows (in thousands): Three Months Ended Loss Recognized in Income March 31, April 1, Location Foreign currency forward contracts $ (123 ) $ (94 ) Interest income and other, net |
Balance Sheet Details
Balance Sheet Details | 3 Months Ended |
Mar. 31, 2018 | |
Balance Sheet Details | |
Balance Sheet Details | 5. Balance Sheet Details The following shows the details of selected Condensed Consolidated Balance Sheet items (in thousands): Inventories March 31, December 30, Work in progress $ 52,566 $ 46,698 Finished goods 23,939 26,434 $ 76,505 $ 73,132 |
Acquisitions
Acquisitions | 3 Months Ended |
Mar. 31, 2018 | |
Acquisitions | |
Acquisitions | 6. Z-Wave On April 18, 2018, the Company completed the acquisition of the |
Debt
Debt | 3 Months Ended |
Mar. 31, 2018 | |
Debt | |
Debt | 7. Debt 1.375% Convertible Senior Notes On March 6, 2017, the Company completed a private offering of $400 million principal amount convertible senior notes (the “Notes”). The Notes bear interest semi-annually at a rate of 1.375% per year and will mature on March 1, 2022, unless repurchased, redeemed or converted at an earlier date. The Company used $72.5 million of the proceeds to pay off the remaining balance of its Amended Credit Agreement. The Notes are convertible at an initial conversion rate of 10.7744 shares of common stock per $1,000 principal amount of the Notes, or approximately 4.3 million shares of common stock, which is equivalent to a conversion price of approximately $92.81 per share. The conversion rate is subject to adjustment under certain circumstances. Holders may convert the Notes under the following circumstances: during any calendar quarter after the calendar quarter ended on June 30, 2017 if the closing price of the Company’s common stock for at least 20 trading days in the 30 consecutive trading days ending on the last trading day of the preceding calendar quarter is greater than or equal to 130% of the conversion price of the Notes; during the five business day period after any ten consecutive trading day period (the “measurement period”) in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the closing sale price of our common stock and the conversion rate on each such trading day; if specified distributions or corporate events occur; if the Notes are called for redemption; or at any time after December 1, 2021. The Company may redeem all or any portion of the Notes, at its option, on or after March 6, 2020, if the last reported sale price of the Company’s common stock has been at least 130% of the conversion price then in effect for at least 20 trading days during any 30 consecutive trading day period. Upon conversion, the Notes may be settled in cash, shares of the Company’s common stock or a combination of cash and shares, at the Company’s election. The principal balance of the Notes was separated into liability and equity components, and was recorded initially at fair value. The excess of the principal amount of the liability component over its carrying amount represents the debt discount, which is amortized to interest expense over the term of the Notes using the effective interest method. The carrying amount of the liability component was estimated by discounting the contractual cash flows of similar non-convertible debt at an appropriate market rate at the date of issuance. The Company incurred debt issuance costs of approximately $10.6 million, which was allocated to the liability and equity components in proportion to the allocation of the proceeds. The costs allocated to the liability component are being amortized as interest expense over the term of the Notes using the effective interest method. The carrying amount of the Notes consisted of the following (in thousands): March 31, December 30, Liability component Principal $ 400,000 $ 400,000 Unamortized debt discount (47,745 ) (50,499 ) Unamortized debt issuance costs (7,206 ) (7,622 ) Net carrying amount $ 345,049 $ 341,879 Equity component Net carrying amount $ 57,735 $ 57,735 The liability component of the Notes is recorded in convertible debt on the Consolidated Balance Sheet. The equity component of the Notes is recorded in additional paid-in capital. The effective interest rate for the liability component was 4.75%. As of March 31, 2018, the remaining period over which the debt discount and debt issuance costs will be amortized was 3.9 years. Interest expense related to the Notes was comprised of the following (in thousands): Three Months Ended March 31, April 1, Contractual interest expense $ 1,390 $ 382 Amortization of debt discount 2,753 754 Amortization of debt issuance costs 416 115 $ 4,559 $ 1,251 Amended Credit Agreement On July 31, 2012, the Company and certain of its domestic subsidiaries (the “Guarantors”) entered into a $230 million five-year Credit Agreement (the “Credit Agreement”), which consisted of a $100 million Term Loan Facility and a $130 million Revolving Credit Facility. On July 24, 2015, the Company and the Guarantors amended the Credit Agreement (the “Amended Credit Agreement”) in order to, among other things, increase the borrowing capacity under the Revolving Credit Facility to $300 million (the “Credit Facility”), eliminate the Term Loan Facility and extend the maturity date to five years from the closing date. On July 24, 2015, the Company borrowed $82.5 million under the Amended Credit Agreement and paid off the remaining balance of its Term Loan Facility. In connection with the Company’s offering of the Notes, it entered into a second amendment to the Credit Agreement (the “Second Amended Credit Agreement”) on February 27, 2017 and paid off the remaining balance of $72.5 million. The Second Amended Credit Agreement retained the key terms and provisions of the first Amended Credit Agreement, including a $25 million letter of credit sublimit and a $10 million swingline loan sublimit. The Company also has an option to increase the size of the borrowing capacity by up to an aggregate of $200 million in additional commitments, subject to certain conditions. The Revolving Credit Facility, other than swingline loans, will bear interest at the Eurodollar rate plus an applicable margin or, at the option of the Company, a base rate (defined as the highest of the Wells Fargo prime rate, the Federal Funds rate plus 0.50% and the Eurodollar Base Rate plus 1.00%) plus an applicable margin. Swingline loans accrue interest at the base rate plus the applicable margin for base rate loans. The applicable margins for the Eurodollar rate loans range from 1.25% to 2.00% and for base rate loans range from 0.25% to 1.00%, depending in each case, on the leverage ratio as defined in the Agreement. The Second Amended Credit Agreement contains various conditions, covenants and representations with which the Company must be in compliance in order to borrow funds and to avoid an event of default, including financial covenants that the Company must maintain a leverage ratio (funded debt/EBITDA) of no more than 3.00 to 1 and a minimum fixed charge coverage ratio (EBITDA/interest payments, income taxes and capital expenditures) of no less than 1.25 to 1. As of March 31, 2018, the Company was in compliance with all covenants of the Second |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2018 | |
Commitments and Contingencies | |
Commitments and Contingencies | 8. Commitments and Contingencies Securities Litigation On March 15, 2018, a purported class action lawsuit was filed Patent Litigation On January In 2014 and 2015, the On July 16, 2014, the Company filed a lawsuit against Cresta Technology in the United States District Court in the Northern District of California alleging infringement of six United States Patents. At this time, the Company cannot predict the outcome of these matters or the resulting financial impact to it, if any. Other The Company is involved in various other legal proceedings that have arisen in the normal course of business. While the ultimate results of these matters cannot be predicted with certainty, the Company does not expect them to have a material adverse effect on its Consolidated Financial Statements. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2018 | |
Stockholders' Equity | |
Stockholders' Equity | 9. Stockholders’ Equity Common Stock The Company issued 0.5 million shares of common stock during the three months ended March 31, 2018. Share Repurchase Programs The Board of Directors authorized the following share repurchase programs (in thousands): Program Program Program October 2017 December 2018 $ 100,000 January 2017 December 2017 $ 100,000 These programs allow for repurchases to be made in the open market or in private transactions, including structured or accelerated transactions, subject to applicable legal requirements and market conditions. The Company Reclassifications From Accumulated Other Comprehensive Loss The following table summarizes the effect on net income from reclassifications out of accumulated other comprehensive loss (in thousands): Three Months Ended Reclassification March 31, April 1, Losses on available-for-sales securities to: Interest income and other, net $ (49 ) $ — Gains on cash flow hedges to: Interest expense — 1,808 (49 ) 1,808 Income tax expense (benefit) 10 (633 ) Total reclassifications $ (39 ) $ 1,175 |
Revenues
Revenues | 3 Months Ended |
Mar. 31, 2018 | |
Revenues | |
Revenues | 10. The Company groups its revenues into four categories, based on the markets and applications in which its products may be used. The following disaggregates the Company’s revenue by product category (in thousands): Three Months Ended March 31, April 1, Internet of Things $ 103,091 $ 87,848 Infrastructure 49,420 35,981 Broadcast 36,065 37,328 Access 16,808 17,871 Revenues $ 205,384 $ 179,028 (1) A portion of the Company’s sales are made to distributors under agreements allowing certain rights of return and/or price protection related to the final selling price to the end customers. These factors impact the timing and uncertainty of revenues and cash flows. The Company recognized revenue of $12.7 million during the three months ended March 31, 2018 from performance obligations that were satisfied in previous reporting periods. The following disaggregates the Company’s revenue by sales channel (in thousands): Three Months Ended March 31, April 1, Distributors $ 150,271 $ 125,743 Direct customers 55,113 53,285 Revenues $ 205,384 $ 179,028 (1) |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2018 | |
Stock-Based Compensation | |
Stock-Based Compensation | 11. Stock-Based Compensation In fiscal 2009, the stockholders of the Company approved the 2009 Stock Incentive Plan (the “2009 Plan”) and the 2009 Employee Stock Purchase Plan (the “2009 Purchase Plan”). In fiscal 2017, the stockholders of the Company approved amendments to both the 2009 Plan and the 2009 Purchase Plan. These amendments authorized additional shares of common stock for issuance, to comply with changes in applicable law, improve the Company’s corporate governance and to implement other best practices. Stock-based compensation costs are based on the fair values on the date of grant for stock awards and stock options and on the date of enrollment for the employee stock purchase plans. The fair values of stock awards (such as RSUs, performance stock units (PSUs) and restricted stock awards (RSAs)) are estimated based on their intrinsic values. The fair values of MSUs are estimated using a Monte Carlo simulation. The fair values of stock options and employee stock purchase plans are estimated using the Black-Scholes option-pricing model. The following table presents details of stock-based compensation costs recognized in the Condensed Consolidated Statements of Income (in thousands): Three Months Ended March 31, April 1, Cost of revenues $ 296 $ 258 Research and development 5,769 5,246 Selling, general and administrative 6,127 4,982 12,192 10,486 Income tax benefit 5,219 5,282 $ 6,973 $ 5,204 The Company had approximately $93.8 million of total unrecognized compensation costs related to granted stock options and awards as of March 31, 2018 that are expected to be recognized over a weighted-average period of approximately 2.3 years. There were no significant stock-based compensation costs capitalized into assets in any of the periods presented. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2018 | |
Income Taxes | |
Income Taxes | 12. Income Taxes Provision (benefit) for income taxes includes both domestic and foreign income taxes at the applicable tax rates adjusted for non-deductible expenses, research and development tax credits and other permanent differences. U.S. Tax Reform The Tax Cuts and Jobs Act (the “Act”) was enacted on December 22, 2017. The Act reduces the U.S. federal corporate income tax rate from 35% to 21%, requires companies to pay a one-time transition tax on earnings of certain foreign subsidiaries previously deferred from tax and creates a new provision designed to tax global intangible low-taxed income (“GILTI”). Also on December 22, 2017, the U.S. Securities and Exchange Commission issued Staff Accounting Bulletin No. 118 (“SAB 118”) which provides for a measurement period of up to one year from the enactment for companies to complete their accounting for the Act. The Company is applying the guidance in SAB 118 when accounting for the enactment-date effects of the Act. At March 31, 2018, the Company has not completed its accounting for the tax effects of the Act but has made reasonable estimates of the effects on the re-measurement of its deferred tax assets and liabilities as well as its transition tax liability. During the three month period ended March 31, 2018, the Company recognized immaterial adjustments to the provisional amounts recorded at December 30, 2017 and included these adjustments as a component of tax expense from continuing operations. The Company has not yet fully collected all necessary data to complete its analysis of the effect of the Act on its deferred tax assets and liabilities and is awaiting additional guidance to complete its analysis. Therefore, the Company has not yet completed its accounting of the re-measurement of its deferred tax assets and liabilities. Additionally, the Company has not yet collected and analyzed all necessary tax and earnings data of its foreign operations and therefore, the Company has also not yet completed its accounting for the income tax effects of the transition tax. The Company will continue to make and refine its calculations as additional analysis is completed. In other cases, the Company has not been able to make a reasonable estimate and therefore continues to account for those items based in its existing accounting under ASC 740, Income Taxes The Act subjects a U.S. shareholder to tax on GILTI earned by certain foreign subsidiaries. Under U.S. GAAP, the Company is permitted to make an accounting policy election to either recognize deferred taxes for temporary basis differences expected to reverse as GILTI in future years or provide for the tax expense related to GILTI in the year the tax is incurred as a period expense only. Given the complexity of the GILTI provisions, the Company is still evaluating the effects of the GILTI provisions and has not yet made its accounting policy election. At March 31, 2018, because the Company is still evaluating the GILTI provisions, the Company has included tax expense related to GILTI for the current year in its estimated annual effective tax rate and has not provided additional GILTI on deferred items. Additionally, while the Act has applied a tax on accumulated foreign earnings as of the end of fiscal 2017, the Company is still evaluating whether to continue to apply the exception under ASC 740-30-25-18 to the presumption of repatriation of foreign earnings. As a result, the Company has not provided an estimate of the taxes associated with the reversal of this exception. The Company is analyzing the impact of a change in this presumption but until completing its analysis, the Company continues to apply the exception under ASC 740-30-25-18. Uncertain Tax Positions As of March 31, 2018, the Company had gross unrecognized tax benefits of $2.6 million, of which $2.0 million would affect the effective tax rate if recognized. During the three months ended March 31, 2018, the Company released $1.5 million of unrecognized tax benefits as a result of a lapse in the statute of limitations. The Company recognizes interest and penalties related to unrecognized tax benefits in the provision (benefit) for income taxes. These amounts were not material for any of the periods presented. The Norwegian Tax Administration (“NTA”) has completed its examination of the Company’s Norwegian subsidiary for income tax matters relating to fiscal years 2013, 2014, 2015 and 2016. The Company received a final assessment from the NTA in December 2017 concerning an adjustment to its 2013 taxable income related to the pricing of an intercompany transaction. The adjustment to 2013 taxable income would result in additional Norwegian tax of approximately $30 million, excluding interest and penalties. The Company disagrees with the NTA’s assessment and believes the Company’s position on this matter is more likely than not to be sustained. The Company plans to exhaust all available administrative remedies, and if unable to resolve this matter through administrative remedies with the NTA, the Company plans to pursue judicial remedies. The Company believes that it is likely that the NTA will request a payment of approximately $15 million in 2018 during the appeal process. The Company believes that it has accrued adequate reserves related to all matters contained in tax periods open to examination. Should the Company experience an unfavorable outcome in the NTA matter, however, such an outcome could have a material impact on its financial statements. Tax years 2013 through 2017 remain open to examination by the major taxing jurisdictions to which the Company is subject. The Company is not currently under audit in any major taxing jurisdiction, except Norway. The Company believes it is reasonably possible that the gross unrecognized tax benefits will decrease by approximately $0.4 million in the next 12 months due to the lapse of the statute of limitations applicable to tax deductions and tax credits claimed on prior year tax returns. |
Significant Accounting Polici19
Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
Significant Accounting Policies | |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Among the significant estimates affecting the financial statements are those related to inventories, goodwill, acquired intangible assets, investments in auction-rate securities, other long-lived assets, revenue recognition, stock-based compensation and income taxes. Actual results could differ from those estimates, and such differences could be material to the financial statements. |
Reclassifications | Reclassifications Certain reclassifications have been made to prior year financial statements to conform to current year presentation. |
Adoption of New Revenue Accounting Standard | Adoption of New Revenue Accounting Standard The Company adopted Accounting Standards Codification (ASC) Topic 606, Revenue from Contracts with Customers Financial Statement Line Item Increase (Decrease) Accounts receivable, net $ 230 Prepaid expenses and other current assets $ 7,579 Other assets, net $ (2,282 ) Deferred revenue and returns liability $ 27,806 Deferred income on shipments to distributors $ (50,115 ) Other current liabilities $ 1,641 Retained earnings $ 26,195 The following presents the amounts by which financial statement line items were affected in the current period due to the adoption of ASC 606 (in thousands): Financial Statement Line Item* Increase (Decrease) Condensed Consolidated Statements of Income Three Months Ended Revenues $ 698 Cost of revenues $ (250 ) Net income $ 390 Earnings per share: Basic $ 0.01 Diluted $ 0.01 Condensed Consolidated Balance Sheet** March 31, 2018 Prepaid expenses and other current assets $ 5,425 Other assets, net $ (2,952 ) Deferred revenue and returns liability $ 25,426 Deferred income on shipments to distributors $ (52,051 ) Other current liabilities $ 2,636 Retained earnings $ 26,585 * Excludes line items that were not materially affected by the Company’s adoption of ASC 606. The adoption had no impact to cash provided by or used in net operating, investing or financing activities in the Condensed Consolidated Statements of Cash Flows. ** Balance sheet line item amounts include the The primary impact of the Company’s adoption of ASC 606 resulted from the acceleration of the timing of revenue recognition on sales to distributors. The Company previously deferred revenue and cost of revenue on such sales until the distributors sold the product to the end customers. The Company now recognizes revenue at the time of sale to the distributor provided all other revenue recognition criteria have been met. The Company records a right of return asset and a returns liability in place of the deferred income on shipments to distributors previously recorded under ASC 605. |
Revenue Recognition | Revenue Recognition Revenue is recognized when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Performance Obligations Substantially all of the Company’s contracts with customers contain a single performance obligation, the sale of mixed-signal integrated circuit (IC) products. Such sales represent a single performance obligation because the sale is one type of good (e.g. an IC) or includes multiple goods that are neither capable of being distinct nor separable from the other promises in the contract (e.g. an IC embedded with software). This performance obligation is satisfied when control of the product is transferred to the customer, which typically occurs upon delivery. Unsatisfied performance obligations primarily represent contracts for products with future delivery dates and with an original expected duration of one year or less. As allowed under ASC 606, the Company has opted to not disclose the amount of unsatisfied performance obligations as these contracts have original expected durations of less than one year. The Company’s products carry a one-year replacement warranty. The replacement warranty promises customers that delivered products are as specified in the contract (an “assurance-type warranty”). Therefore, the Company accounts for such warranties under ASC 460, Guarantees Transaction Price The transaction price reflects the Company’s expectations about the consideration it will be entitled to receive from the customer and may include fixed or variable amounts. Fixed consideration primarily includes sales to direct customers and sales to distributors in which both the sale to the distributor and the sale to the end customer occur within the same reporting period. Variable consideration includes sales in which the amount of consideration that the Company will receive is unknown as of the end of a reporting period. Such consideration primarily includes sales made to distributors under agreements allowing certain rights of return, referred to as stock rotation, and credits issued to the distributor due to price protection. Stock rotation allows distributors limited levels of returns and is based on the distributor’s prior purchases. Price protection represents price discounts granted to certain distributors and is based on negotiations on sales to end customers. The Company estimates variable consideration at the most likely amount to which it expects to be entitled. Included in the transaction price estimate are amounts in which it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. The estimate is based on information available to the Company, including recent sales activity and pricing data. The Company applies a constraint to its variable consideration estimate which considers both the likelihood of a return and the amount of a potential price concession. Variable consideration that does not meet revenue recognition criteria is deferred. The Company records a right of return asset for the costs of distributor inventory not meeting revenue recognition criteria. A corresponding deferred revenue and returns liability is recorded for unrecognized revenue associated with such costs. Contract Balances Accounts receivable represents the Company’s unconditional right to receive consideration from its customer. Payments are typically due within 30 days of invoicing and do not include a significant financing component. To date, there have been no material impairment losses on accounts receivable. There were no material contract assets or contract liabilities recorded on the Condensed Consolidated Balance Sheet in any of the periods presented. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In February 2018, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2018-02, Income Statement—Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. In August 2017, the FASB issued ASU No. 2017-12 , Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. In January 2017, the FASB issued ASU No. 2017-04 , Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) |
Significant Accounting Polici20
Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Significant Accounting Policies | |
Schedule of changes recorded in connection with the cumulative-effect adjustment | The following reflects the material changes recorded in connection with the cumulative-effect adjustment (in thousands): Financial Statement Line Item Increase (Decrease) Accounts receivable, net $ 230 Prepaid expenses and other current assets $ 7,579 Other assets, net $ (2,282 ) Deferred revenue and returns liability $ 27,806 Deferred income on shipments to distributors $ (50,115 ) Other current liabilities $ 1,641 Retained earnings $ 26,195 |
Schedule of condensed consolidated statement of income | The following presents the amounts by which financial statement line items were affected in the current period due to the adoption of ASC 606 (in thousands): Financial Statement Line Item* Increase (Decrease) Condensed Consolidated Statements of Income Three Months Ended Revenues $ 698 Cost of revenues $ (250 ) Net income $ 390 Earnings per share: Basic $ 0.01 Diluted $ 0.01 * Excludes line items that were not materially affected by the Company’s adoption of ASC 606. The adoption had no impact to cash provided by or used in net operating, investing or financing activities in the Condensed Consolidated Statements of Cash Flows. |
Schedule of condensed consolidated balance sheet | The following presents the amounts by which financial statement line items were affected in the current period due to the adoption of ASC 606 (in thousands): Condensed Consolidated Balance Sheet** March 31, 2018 Prepaid expenses and other current assets $ 5,425 Other assets, net $ (2,952 ) Deferred revenue and returns liability $ 25,426 Deferred income on shipments to distributors $ (52,051 ) Other current liabilities $ 2,636 Retained earnings $ 26,585 ** Balance sheet line item amounts include the |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share | |
Schedule of computation of basic and diluted earnings per share | The following table sets forth the computation of basic and diluted earnings per share (in thousands, except per share data): Three Months Ended March 31, April 1, Net income $ 26,405 $ 15,426 Shares used in computing basic earnings per share 42,963 42,096 Effect of dilutive securities: Stock options and other stock-based awards 955 934 Shares used in computing diluted earnings per share 43,918 43,030 Earnings per share: Basic $ 0.61 $ 0.37 Diluted $ 0.60 $ 0.36 |
Fair Value of Financial Instr22
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Fair Value of Financial Instruments | |
Financial assets and liabilities measured at fair value on a recurring basis | Fair Value Measurements Description Quoted Prices in Significant Other Significant Total Assets: Cash equivalents: Money market funds $ 111,866 $ — $ — $ 111,866 Corporate debt securities — 9,419 — 9,419 Government debt securities 24,997 — — 24,997 Total cash equivalents $ 136,863 $ 9,419 $ — $ 146,282 Short-term investments: Government debt securities $ 65,239 $ 219,493 $ — $ 284,732 Corporate debt securities — 133,135 — 133,135 Total short-term investments $ 65,239 $ 352,628 $ — $ 417,867 Other assets, net: Auction rate securities $ — $ — $ 5,609 $ 5,609 Total $ — $ — $ 5,609 $ 5,609 Total $ 202,102 $ 362,047 $ 5,609 $ 569,758 Fair Value Measurements Description Quoted Prices in Significant Other Significant Total Assets: Cash equivalents: Money market funds $ 106,047 $ — $ — $ 106,047 Corporate debt securities — 11,231 — 11,231 Government debt securities 53,615 1,453 — 55,068 Total cash equivalents $ 159,662 $ 12,684 $ — $ 172,346 Short-term investments: Government debt securities $ 94,575 $ 228,247 $ — $ 322,822 Corporate debt securities — 171,835 — 171,835 Total short-term investments $ 94,575 $ 400,082 $ — $ 494,657 Other assets, net: Auction rate securities $ — $ — $ 5,681 $ 5,681 Total $ — $ — $ 5,681 $ 5,681 Total $ 254,237 $ 412,766 $ 5,681 $ 672,684 |
Summarization of contractual underlying maturities of available-for-sale investments | The following summarizes the contractual underlying maturities of the Company’s Cost Fair Due in one year or less $ 338,056 $ 337,433 Due after one year through ten years 135,923 134,453 Due after ten years 98,269 97,872 $ 572,248 $ 569,758 |
Schedule of available-for-sale investments in continuous unrealized loss position by length of time | The available-for-sale investments that were in a continuous unrealized loss position, aggregated by length of time that individual securities have been in a continuous loss position, were as follows (in thousands): Less Than 12 Months 12 Months or Greater Total As of March 31, 2018 Fair Gross Fair Gross Fair Gross Government debt securities $ 182,320 $ (1,059 ) $ 4,432 $ (10 ) $ 186,752 $ (1,069 ) Corporate debt securities 120,303 (929 ) 11,327 (100 ) 131,630 (1,029 ) Auction rate securities — — 5,609 (391 ) 5,609 (391 ) $ 302,623 $ (1,988 ) $ 21,368 $ (501 ) $ 323,991 $ (2,489 ) Less Than 12 Months 12 Months or Greater Total As of December 30, 2017 Fair Gross Fair Gross Fair Gross Government debt securities $ 244,880 $ (931 ) $ 3,027 $ (15 ) $ 247,907 $ (946 ) Corporate debt securities 151,149 (447 ) 11,578 (73 ) 162,727 (520 ) Auction rate securities — — 5,681 (319 ) 5,681 (319 ) $ 396,029 $ (1,378 ) $ 20,286 $ (407 ) $ 416,315 $ (1,785 ) |
Summary of quantitative information about level 3 asset fair value measurements | Auction rate securities Fair Value at Valuation Technique Unobservable Input Weighted Average $ 5,609 Discounted cash flow Estimated yield 2.22% Expected holding period 10 years Estimated discount rate 3.63% |
Summary of activity in Level 3 financial instruments | The following summarizes the activity in Level 3 financial instruments for the three months ended March 31, 2018 (in thousands): Assets Auction Rate Securities Three Months Beginning balance $ 5,681 Loss included in other comprehensive loss (72 ) Balance at March 31, 2018 $ 5,609 |
Derivative Financial Instrume23
Derivative Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Derivative Financial Instruments | |
Schedule of before-tax effect of derivative instruments not designated as hedging instruments | The before-tax effect of derivative instruments not designated as hedging instruments was as follows (in thousands): Three Months Ended Loss Recognized in Income March 31, April 1, Location Foreign currency forward contracts $ (123 ) $ (94 ) Interest income and other, net |
Balance Sheet Details (Tables)
Balance Sheet Details (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Balance Sheet Details | |
Schedule of condensed consolidated balance sheet details of inventories | The following shows the details of selected Condensed Consolidated Balance Sheet items (in thousands): Inventories March 31, December 30, Work in progress $ 52,566 $ 46,698 Finished goods 23,939 26,434 $ 76,505 $ 73,132 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Debt | |
Summary of information about the equity and liability components of the convertible senior notes | The carrying amount of the Notes consisted of the following (in thousands): March 31, December 30, Liability component Principal $ 400,000 $ 400,000 Unamortized debt discount (47,745 ) (50,499 ) Unamortized debt issuance costs (7,206 ) (7,622 ) Net carrying amount $ 345,049 $ 341,879 Equity component Net carrying amount $ 57,735 $ 57,735 |
Schedule of components of interest expense | Interest expense related to the Notes was comprised of the following (in thousands): Three Months Ended March 31, April 1, Contractual interest expense $ 1,390 $ 382 Amortization of debt discount 2,753 754 Amortization of debt issuance costs 416 115 $ 4,559 $ 1,251 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Stockholders' Equity | |
Schedule of share repurchase programs | The Board of Directors authorized the following share repurchase programs (in thousands): Program Program Program October 2017 December 2018 $ 100,000 January 2017 December 2017 $ 100,000 |
Schedule of reclassifications out of accumulated other comprehensive income (loss) | The following table summarizes the effect on net income from reclassifications out of accumulated other comprehensive loss (in thousands): Three Months Ended Reclassification March 31, April 1, Losses on available-for-sales securities to: Interest income and other, net $ (49 ) $ — Gains on cash flow hedges to: Interest expense — 1,808 (49 ) 1,808 Income tax expense (benefit) 10 (633 ) Total reclassifications $ (39 ) $ 1,175 |
Revenues (Tables)
Revenues (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Revenues | |
Schedule of disaggregation of revenue by product category | The following disaggregates the Company’s revenue by product category (in thousands): Three Months Ended March 31, April 1, Internet of Things $ 103,091 $ 87,848 Infrastructure 49,420 35,981 Broadcast 36,065 37,328 Access 16,808 17,871 Revenues $ 205,384 $ 179,028 (1) |
Schedule of disaggregation of revenue by sales channel | The following disaggregates the Company’s revenue by sales channel (in thousands): Three Months Ended March 31, April 1, Distributors $ 150,271 $ 125,743 Direct customers 55,113 53,285 Revenues $ 205,384 $ 179,028 (1) |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Stock-Based Compensation | |
Schedule of stock-based compensation costs recognized in the Condensed Consolidated Statements of Income | The following table presents details of stock-based compensation costs recognized in the Condensed Consolidated Statements of Income (in thousands): Three Months Ended March 31, April 1, Cost of revenues $ 296 $ 258 Research and development 5,769 5,246 Selling, general and administrative 6,127 4,982 12,192 10,486 Income tax benefit 5,219 5,282 $ 6,973 $ 5,204 |
Significant Accounting Polici29
Significant Accounting Policies (Details) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2018 | Dec. 30, 2017 | |
Basis of Presentation and Principles of Consolidation | ||
Length of fiscal year | 364 days | 364 days |
Number of days in each fiscal quarter for 52-week fiscal year | 91 days | |
Low end of range | ||
Basis of Presentation and Principles of Consolidation | ||
Length of fiscal year | 364 days | |
High end of range | ||
Basis of Presentation and Principles of Consolidation | ||
Length of fiscal year | 371 days |
Significant Accounting Polici30
Significant Accounting Policies - Adoption of New Revenue Accounting Standard (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |||
Mar. 31, 2018 | Apr. 01, 2017 | Dec. 31, 2017 | Dec. 30, 2017 | |
Adoption of New Accounting Standard | ||||
Retained earnings | $ 904,160 | $ 851,307 | ||
Condensed Consolidated Statements of Cash Flows | ||||
Accounts receivable, net | 3,307 | $ 1,252 | ||
Prepaid expenses and other current assets | 17,169 | (6,708) | ||
Deferred revenue and returns liability | (2,599) | 4,038 | ||
Condensed Consolidated Statements of Income | ||||
Cost of revenues | (81,147) | (73,867) | ||
Net income | $ 26,405 | $ 15,426 | ||
Earnings per share: | ||||
Basic (in dollars per share) | $ 0.61 | $ 0.37 | ||
Diluted (in dollars per share) | $ 0.60 | $ 0.36 | ||
Condensed Consolidated Balance Sheet | ||||
Prepaid expenses and other current assets | $ 64,555 | 39,120 | ||
Other assets, net | 94,837 | 88,387 | ||
Deferred revenue and returns liability | 25,426 | |||
Deferred income on shipments to distributors | (50,115) | |||
Other current liabilities | 69,310 | 73,359 | ||
Retained earnings | $ 904,160 | $ 851,307 | ||
Performance Obligations | ||||
Product replacement warranty | 1 year | |||
Accounting Standards Update 2014-09 - Revenue from Contracts with Customers | ||||
Adoption of New Accounting Standard | ||||
Retained earnings | $ 26,585 | |||
Condensed Consolidated Statements of Cash Flows | ||||
Accounts receivable, net | 230 | |||
Prepaid expenses and other current assets | 7,579 | |||
Other assets, net | (2,282) | |||
Deferred revenue and returns liability | 27,806 | |||
Deferred income on shipments to distributors | (50,115) | |||
Other current liabilities | 1,641 | |||
Retained earnings | 26,195 | |||
Condensed Consolidated Statements of Income | ||||
Revenue | 698 | |||
Cost of revenues | (250) | |||
Net income | $ 390 | |||
Earnings per share: | ||||
Basic (in dollars per share) | $ 0.01 | |||
Diluted (in dollars per share) | $ 0.01 | |||
Condensed Consolidated Balance Sheet | ||||
Prepaid expenses and other current assets | $ 5,425 | |||
Other assets, net | (2,952) | |||
Deferred revenue and returns liability | 25,426 | |||
Deferred income on shipments to distributors | (52,051) | |||
Other current liabilities | 2,636 | |||
Retained earnings | $ 26,585 | |||
Accounting Standards Update 2014-09 - Revenue from Contracts with Customers | Early Adoption, Effect | ||||
Adoption of New Accounting Standard | ||||
Retained earnings | $ 26,200 | |||
Condensed Consolidated Balance Sheet | ||||
Retained earnings | $ 26,200 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Earnings Per Share | ||
Net income | $ 26,405 | $ 15,426 |
Shares used in computing basic earnings per share (in shares) | 42,963 | 42,096 |
Effect of dilutive securities: | ||
Stock options and other stock-based awards (in shares) | 955 | 934 |
Shares used in computing diluted earnings per share (in shares) | 43,918 | 43,030 |
Earnings per share: | ||
Basic (in dollars per share) | $ 0.61 | $ 0.37 |
Diluted (in dollars per share) | $ 0.60 | $ 0.36 |
Shares excluded from computation of diluted earning per share (in shares) | 0 | 300 |
Shares issued upon conversion of principal amount | ||
Earnings per share: | ||
Shares excluded from computation of diluted earning per share (in shares) | 100 |
Fair Value of Financial Instr32
Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 30, 2017 |
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total short-term investments | $ 417,867 | $ 494,657 |
Assets and liabilities measured at fair value on recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total cash equivalents | 136,863 | 159,662 |
Total short-term investments | 65,239 | 94,575 |
Total assets at fair value | 202,102 | 254,237 |
Assets and liabilities measured at fair value on recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Money market funds | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total cash equivalents | 111,866 | 106,047 |
Assets and liabilities measured at fair value on recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | Government debt securities | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total cash equivalents | 24,997 | 53,615 |
Total short-term investments | 65,239 | 94,575 |
Assets and liabilities measured at fair value on recurring basis | Significant Other Observable Inputs (Level 2) | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total cash equivalents | 9,419 | 12,684 |
Total short-term investments | 352,628 | 400,082 |
Total assets at fair value | 362,047 | 412,766 |
Assets and liabilities measured at fair value on recurring basis | Significant Other Observable Inputs (Level 2) | Corporate debt securities | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total cash equivalents | 9,419 | 11,231 |
Total short-term investments | 133,135 | 171,835 |
Assets and liabilities measured at fair value on recurring basis | Significant Other Observable Inputs (Level 2) | Government debt securities | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total cash equivalents | 1,453 | |
Total short-term investments | 219,493 | 228,247 |
Assets and liabilities measured at fair value on recurring basis | Significant Unobservable Inputs (Level 3) | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Other assets, net | 5,609 | 5,681 |
Total assets at fair value | 5,609 | 5,681 |
Assets and liabilities measured at fair value on recurring basis | Significant Unobservable Inputs (Level 3) | Auction rate securities | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Other assets, net | 5,609 | 5,681 |
Assets and liabilities measured at fair value on recurring basis | Fair Value | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total cash equivalents | 146,282 | 172,346 |
Total short-term investments | 417,867 | 494,657 |
Other assets, net | 5,609 | 5,681 |
Total assets at fair value | 569,758 | 672,684 |
Assets and liabilities measured at fair value on recurring basis | Fair Value | Money market funds | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total cash equivalents | 111,866 | 106,047 |
Assets and liabilities measured at fair value on recurring basis | Fair Value | Corporate debt securities | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total cash equivalents | 9,419 | 11,231 |
Total short-term investments | 133,135 | 171,835 |
Assets and liabilities measured at fair value on recurring basis | Fair Value | Government debt securities | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Total cash equivalents | 24,997 | 55,068 |
Total short-term investments | 284,732 | 322,822 |
Assets and liabilities measured at fair value on recurring basis | Fair Value | Auction rate securities | ||
Financial assets and liabilities measured at fair value on a recurring basis | ||
Other assets, net | $ 5,609 | $ 5,681 |
Fair Value of Financial Instr33
Fair Value of Financial Instruments - Available-for-sale investments (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Dec. 30, 2017 | |
Cost | ||
Due in one year or less, Cost | $ 338,056 | |
Due after one year through ten years, Cost | 135,923 | |
Due after ten years, Cost | 98,269 | |
Total Cost | 572,248 | |
Fair Value | ||
Due in one year or less, Fair Value | 337,433 | |
Due after one year through ten years, Fair Value | 134,453 | |
Due after ten years, Fair Value | 97,872 | |
Total Fair Value | 569,758 | |
Continuous unrealized loss position, Fair Value | ||
Fair value of available-for-sale securities, continuous loss position for less than twelve months | 302,623 | $ 396,029 |
Fair value of available-for-sale securities, continuous loss position for twelve months or greater | 21,368 | 20,286 |
Total fair value of available-for-sale securities, continuous loss position | 323,991 | 416,315 |
Continuous unrealized loss position, Gross Unrealized Losses | ||
Available-for-sale securities, continuous loss position for less than 12 months, gross unrealized losses | (1,988) | (1,378) |
Available-for-sale securities, continuous loss position for 12 months or greater, gross unrealized losses | (501) | (407) |
Available-for-sale securities, total gross unrealized losses | (2,489) | (1,785) |
Other than temporary impairment losses | ||
Other-than-temporary impairment losses | 0 | |
Government debt securities | ||
Continuous unrealized loss position, Fair Value | ||
Fair value of available-for-sale securities, continuous loss position for less than twelve months | 182,320 | 244,880 |
Fair value of available-for-sale securities, continuous loss position for twelve months or greater | 4,432 | 3,027 |
Total fair value of available-for-sale securities, continuous loss position | 186,752 | 247,907 |
Continuous unrealized loss position, Gross Unrealized Losses | ||
Available-for-sale securities, continuous loss position for less than 12 months, gross unrealized losses | (1,059) | (931) |
Available-for-sale securities, continuous loss position for 12 months or greater, gross unrealized losses | (10) | (15) |
Available-for-sale securities, total gross unrealized losses | (1,069) | (946) |
Corporate debt securities | ||
Continuous unrealized loss position, Fair Value | ||
Fair value of available-for-sale securities, continuous loss position for less than twelve months | 120,303 | 151,149 |
Fair value of available-for-sale securities, continuous loss position for twelve months or greater | 11,327 | 11,578 |
Total fair value of available-for-sale securities, continuous loss position | 131,630 | 162,727 |
Continuous unrealized loss position, Gross Unrealized Losses | ||
Available-for-sale securities, continuous loss position for less than 12 months, gross unrealized losses | (929) | (447) |
Available-for-sale securities, continuous loss position for 12 months or greater, gross unrealized losses | (100) | (73) |
Available-for-sale securities, total gross unrealized losses | (1,029) | (520) |
Auction rate securities | ||
Continuous unrealized loss position, Fair Value | ||
Fair value of available-for-sale securities, continuous loss position for twelve months or greater | 5,609 | 5,681 |
Total fair value of available-for-sale securities, continuous loss position | 5,609 | 5,681 |
Continuous unrealized loss position, Gross Unrealized Losses | ||
Available-for-sale securities, continuous loss position for 12 months or greater, gross unrealized losses | (391) | (319) |
Available-for-sale securities, total gross unrealized losses | $ (391) | $ (319) |
Fair Value of Financial Instr34
Fair Value of Financial Instruments - Auction rate securities and Contingent consideration (Details) - Auction rate securities - Significant Unobservable Inputs (Level 3) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Dec. 30, 2017 | |
Weighted Average | Discounted cash flow | ||
Quantitative information for Level 3 Fair Value Measurements Assets | ||
Estimated yield (as a percent) | 2.22% | |
Expected holding period | 10 years | |
Estimated discount rate (as a percent) | 3.63% | |
Assets and liabilities measured at fair value on recurring basis | ||
Quantitative information for Level 3 Fair Value Measurements Assets | ||
Fair value balance at the end of the period | $ 5,609 | $ 5,681 |
Fair Value of Financial Instr35
Fair Value of Financial Instruments - Assets in Level 3 (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Dec. 30, 2017 | |
Assets and liabilities measured at fair value on recurring basis | Significant Unobservable Inputs (Level 3) | Auction rate securities | ||
Fair value assets reconciliation of changes | ||
Balance at the beginning of the period | $ 5,681 | |
Loss included in other comprehensive loss | (72) | |
Balance at the end of the period | 5,609 | |
Convertible Senior Notes | ||
Fair value assets reconciliation of changes | ||
Fair value of debt | $ 457,400 | $ 466,200 |
Derivative Financial Instrume36
Derivative Financial Instruments - Cash Flow Hedges (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2018 | Apr. 01, 2017 | Jul. 31, 2016 | |
Derivatives of Cash Flow Hedges | ||||
Reclassification of unrealized gains included in net income | $ 1,808 | |||
Cash flow hedges | Interest rate swaps | ||||
Derivatives of Cash Flow Hedges | ||||
Original notional value | $ 72,500 | |||
Reclassification of unrealized gains included in net income | $ 1,800 | |||
Cash flow hedges | Foreign currency forward contracts | ||||
Derivatives of Cash Flow Hedges | ||||
Original notional value | $ 8,300 | $ 8,300 | ||
Amount reclassified from accumulated other comprehensive income (loss) into earnings | $ 0 | |||
Low end of range | Cash flow hedges | Foreign currency forward contracts | ||||
Derivatives of Cash Flow Hedges | ||||
Maturity of contracts | 1 month | |||
High end of range | Cash flow hedges | Foreign currency forward contracts | ||||
Derivatives of Cash Flow Hedges | ||||
Maturity of contracts | 12 months |
Derivative Financial Instrume37
Derivative Financial Instruments - Non-designated Hedges (Details) - Not designated as hedging instrument - Foreign currency forward contracts $ in Thousands | 3 Months Ended | |
Mar. 31, 2018USD ($)contract | Apr. 01, 2017USD ($)contract | |
Derivative Instruments, Gain (Loss) | ||
Number of foreign currency forward contract held | contract | 1 | 1 |
Original notional value | $ 2,600 | $ 4,000 |
Interest income and other, net | ||
Derivative Instruments, Gain (Loss) | ||
Loss Recognized in Income | $ (123) | $ (94) |
Balance Sheet Details (Details)
Balance Sheet Details (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 30, 2017 |
Inventories | ||
Work in progress | $ 52,566 | $ 46,698 |
Finished goods | 23,939 | 26,434 |
Total inventories | $ 76,505 | $ 73,132 |
Acquisitions (Details)
Acquisitions (Details) $ in Millions | Apr. 18, 2018USD ($) |
Z-Wave | |
Acquisition | |
Purchase price of acquisition | $ 240 |
Debt - Convertible Senior Notes
Debt - Convertible Senior Notes (Details) $ / shares in Units, shares in Millions | Mar. 06, 2017USD ($)item$ / sharesshares | Mar. 31, 2018USD ($) | Dec. 30, 2017USD ($) |
Amended Credit Agreement | |||
Debt | |||
Repayment of debt | $ 72,500,000 | ||
1.375% Convertible Senior Notes | |||
Debt | |||
Principal amount of convertible senior notes sold in private placement | $ 400,000,000 | $ 400,000,000 | $ 400,000,000 |
Stated interest rate | 1.375% | ||
Conversion rate | 10.7744 | ||
Principal amount of notes | $ 1,000 | ||
Number of shares of common stock | shares | 4.3 | ||
Initial conversion price | $ / shares | $ 92.81 | ||
Number of trading days within 30 trading day period | item | 20 | ||
Number of consecutive trading days | item | 30 | ||
Minimum amount the sales price of the Company's stock exceeds the conversion price (as a percent) | 130.00% | ||
Number of consecutive business days after the 10 consecutive trading day period | 5 days | ||
Number of consecutive trading days before the five consecutive business days | 10 days | ||
Maximum amount the sales price of the Company's stock exceeds the conversion price (as a percent) | 98.00% |
Debt - Carrying amount of notes
Debt - Carrying amount of notes and interest expense (Details) - 1.375% Convertible Senior Notes - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2018 | Apr. 01, 2017 | Dec. 30, 2017 | Mar. 06, 2017 | |
Debt | ||||
Total Debt issuance costs | $ 10,600 | |||
Liability component | ||||
Principal | $ 400,000 | $ 400,000 | $ 400,000 | |
Unamortized debt discount | (47,745) | (50,499) | ||
Unamortized debt issuance costs | (7,206) | (7,622) | ||
Net carrying amount | 345,049 | 341,879 | ||
Equity component | ||||
Net carrying amount | $ 57,735 | $ 57,735 | ||
Effective interest rate | 4.75% | |||
Amortization of debt discount and debt issuance costs | 3 years 10 months 24 days | |||
Interest expense related to the Notes | ||||
Contractual interest expense | $ 1,390 | $ 382 | ||
Amortization of debt discount | 2,753 | 754 | ||
Amortization of debt issuance costs | 416 | 115 | ||
Interest Expense, Total | $ 4,559 | $ 1,251 |
Debt - Amended Credit Agreement
Debt - Amended Credit Agreement (Details) $ in Millions | Feb. 27, 2017USD ($) | Jul. 24, 2015USD ($) | Jul. 31, 2012USD ($) | Mar. 31, 2018 |
Credit Agreement | ||||
Debt | ||||
Maximum borrowing capacity | $ 230 | |||
Term of debt instrument | 5 years | |||
Amount borrowed under the Amended Credit Agreement | $ 82.5 | |||
Revolving Credit Facility | ||||
Debt | ||||
Maximum borrowing capacity | $ 300 | $ 130 | ||
Term of debt instrument | 5 years | |||
Sublimit on letters of credit | $ 25 | |||
Sublimit on swingline loan | 10 | |||
Additional increase in borrowing capacity of the line of credit available at the entity's option | 200 | |||
Amended Credit Agreement | ||||
Debt | ||||
Repayment of credit facility amount | $ 72.5 | |||
Maximum leverage ratio | 3 | |||
Minimum fixed charge coverage ratio | 1.25 | |||
Revolving credit facility, other than swingline loans | Federal Funds | ||||
Debt | ||||
Interest rate added to the base rate (as a percent) | 0.50% | |||
Revolving credit facility, other than swingline loans | Eurodollar base rate | ||||
Debt | ||||
Interest rate added to the base rate (as a percent) | 1.00% | |||
Revolving credit facility, other than swingline loans | Eurodollar | Low end of range | ||||
Debt | ||||
Interest rate added to the base rate (as a percent) | 1.25% | |||
Revolving credit facility, other than swingline loans | Eurodollar | High end of range | ||||
Debt | ||||
Interest rate added to the base rate (as a percent) | 2.00% | |||
Term loan facility, revolving credit facility, swingline and other loans | Base rate | Low end of range | ||||
Debt | ||||
Interest rate added to the base rate (as a percent) | 0.25% | |||
Term loan facility, revolving credit facility, swingline and other loans | Base rate | High end of range | ||||
Debt | ||||
Interest rate added to the base rate (as a percent) | 1.00% | |||
Term Loan Facility | ||||
Debt | ||||
Maximum borrowing capacity | $ 100 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - Cresta Technology - patent | Jul. 16, 2014 | Jan. 28, 2014 | Jan. 02, 2016 | Jan. 03, 2015 |
Patent Litigation | ||||
Number of patents allegedly infringed | 6 | 3 | ||
Number of creditors assuming ownership of Cresta Patents | 1 | |||
Number of patents with validity challenged | 2 | 2 |
Stockholders' Equity - Share re
Stockholders' Equity - Share repurchase programs (Details) - USD ($) $ in Thousands, shares in Millions | 3 Months Ended | ||
Mar. 31, 2018 | Oct. 31, 2017 | Jan. 31, 2017 | |
Stockholders' Equity | |||
Number of shares of common stock issued | 0.5 | ||
Program Amount authorized to repurchase | $ 100,000 | $ 100,000 |
Stockholders' Equity - Reclassi
Stockholders' Equity - Reclassified from AOCI (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Amounts Reclassified from AOCI | ||
Provision (benefit) for income taxes | $ 4,371 | $ 1,970 |
Net income | 26,405 | 15,426 |
Reclassifications From Accumulated Other Comprehensive Income (Loss) | ||
Amounts Reclassified from AOCI | ||
Income (loss) before income taxes | 49 | (1,808) |
Provision (benefit) for income taxes | 10 | (633) |
Net income | (39) | 1,175 |
Losses on available-for-sales securities | Reclassifications From Accumulated Other Comprehensive Income (Loss) | ||
Amounts Reclassified from AOCI | ||
Interest income and other, net | $ (49) | |
Gains on cash flow hedges | Reclassifications From Accumulated Other Comprehensive Income (Loss) | ||
Amounts Reclassified from AOCI | ||
Interest expense | $ 1,808 |
Revenues (Details)
Revenues (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Revenues | ||
Revenues | $ 205,384 | $ 179,028 |
Revenue from performance obligations | 12,700 | |
Distributors | ||
Revenues | ||
Revenues | 150,271 | 125,743 |
Direct customers | ||
Revenues | ||
Revenues | 55,113 | 53,285 |
Internet of Things | ||
Revenues | ||
Revenues | 103,091 | 87,848 |
Infrastructure | ||
Revenues | ||
Revenues | 49,420 | 35,981 |
Broadcast | ||
Revenues | ||
Revenues | 36,065 | 37,328 |
Access | ||
Revenues | ||
Revenues | $ 16,808 | $ 17,871 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Stock-based compensation costs | ||
Stock based compensation costs | $ 12,192 | $ 10,486 |
Income tax benefit | 5,219 | 5,282 |
Share based compensation costs after tax | 6,973 | 5,204 |
Total unrecognized compensation costs related to awards | $ 93,800 | |
Weighted-average period of recognition of unrecognized compensation costs | 2 years 3 months 18 days | |
Cost of revenues | ||
Stock-based compensation costs | ||
Stock based compensation costs | $ 296 | 258 |
Research and development | ||
Stock-based compensation costs | ||
Stock based compensation costs | 5,769 | 5,246 |
Selling, general and administrative | ||
Stock-based compensation costs | ||
Stock based compensation costs | $ 6,127 | $ 4,982 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 | Apr. 01, 2017 | Dec. 29, 2018 | Dec. 30, 2017 | |
Income Taxes | ||||
Provision (benefit) for income taxes | $ 4,371 | $ 1,970 | ||
Effective income tax rate (as a percent) | (19.80%) | (14.60%) | ||
Federal statutory rate (as a percent) | 21.00% | 35.00% | ||
Gross unrecognized tax benefits | $ 2,600 | |||
Gross unrecognized tax benefits which would affect the effective tax rate if recognized | 2,000 | |||
Unrecognized tax benefits as a result of a lapse in the statute of limitations | 1,500 | |||
Amount of estimated decrease in unrecognized tax benefits | 400 | |||
2013 | Norwegian | ||||
Income Taxes | ||||
Adjustments to taxable income excluding interest and penalties | $ 30,000 | |||
Forecast | Norwegian | ||||
Income Taxes | ||||
Taxes payable during appeal process | $ 15,000 |