Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 29, 2018 | Jul. 25, 2018 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | ON Semiconductor Corporation | |
Entity Central Index Key | 1,097,864 | |
Current Fiscal Year End | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Jun. 29, 2018 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,018 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 426,215,520 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Jun. 29, 2018 | Dec. 31, 2017 |
Assets | ||
Cash and cash equivalents | $ 850.2 | $ 949.2 |
Receivables, net | 698.8 | 701.5 |
Inventories | 1,204.4 | 1,089.5 |
Other current assets | 173.6 | 193 |
Total current assets | 2,927 | 2,933.2 |
Property, plant and equipment, net | 2,387.2 | 2,279.1 |
Goodwill | 928.8 | 916.9 |
Intangible assets, net | 627.9 | 628.3 |
Deferred tax assets | 298.9 | 339.1 |
Other assets | 127.5 | 98.5 |
Total assets | 7,297.3 | 7,195.1 |
Liabilities, Non-Controlling Interest and Stockholders’ Equity | ||
Accounts payable | 584.7 | 548 |
Accrued expenses | 563.9 | 612.8 |
Current portion of long-term debt | 746.4 | 248.1 |
Total current liabilities | 1,895 | 1,408.9 |
Long-term debt | 2,020.4 | 2,703.7 |
Deferred tax liabilities | 63.6 | 55.1 |
Other long-term liabilities | 221.5 | 226.4 |
Total liabilities | 4,200.5 | 4,394.1 |
Commitments and contingencies | ||
ON Semiconductor Corporation stockholders’ equity: | ||
Common stock ($0.01 par value, 1,250,000,000 and 1,250,000,000 shares authorized, 555,619,904 and 551,873,115 issued, 426,359,988 and 425,118,194 outstanding, respectively) | 5.6 | 5.5 |
Additional paid-in capital | 3,646.1 | 3,593.5 |
Accumulated other comprehensive loss | (34.9) | (40.6) |
Accumulated earnings | 646.9 | 351.5 |
Less: Treasury stock, at cost: 129,259,916 and 126,754,921 shares, respectively | (1,191) | (1,131.1) |
Total ON Semiconductor Corporation stockholders’ equity | 3,072.7 | 2,778.8 |
Non-controlling interest in consolidated subsidiary | 24.1 | 22.2 |
Total stockholders' equity | 3,096.8 | 2,801 |
Total liabilities and stockholders' equity | $ 7,297.3 | $ 7,195.1 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 29, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 1,250,000,000 | 1,250,000,000 |
Common stock, shares issued (in shares) | 555,619,904 | 551,873,115 |
Common stock, shares outstanding (in shares) | 426,359,988 | 425,118,194 |
Treasury stock, shares (in shares) | 129,259,916 | 126,754,921 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Income - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | |
Income Statement [Abstract] | ||||
Revenues | $ 1,455.9 | $ 1,338 | $ 2,833.5 | $ 2,774.7 |
Cost of revenues (exclusive of amortization shown below) | 900.9 | 846 | 1,761.1 | 1,779.6 |
Gross profit | 555 | 492 | 1,072.4 | 995.1 |
Operating expenses: | ||||
Research and development | 167.1 | 145.6 | 322.3 | 285.7 |
Selling and marketing | 81.7 | 79.5 | 159.5 | 157 |
General and administrative | 74.6 | 76.6 | 145.5 | 145 |
Amortization of acquisition-related intangible assets | 27.9 | 28.6 | 55.3 | 57.7 |
Restructuring, asset impairments and other, net | 3.2 | 5.9 | 3.6 | 6.4 |
Goodwill and intangible asset impairment | 3.3 | 1.8 | 3.3 | 6.2 |
Total operating expenses | 357.8 | 338 | 689.5 | 658 |
Operating income | 197.2 | 154 | 382.9 | 337.1 |
Other (expense) income, net: | ||||
Interest expense | (32.6) | (34.7) | (64.1) | (73.1) |
Interest income | 1.1 | 0.5 | 2 | 1.1 |
Loss on debt refinancing and prepayment | (4) | 0 | (4) | (26.2) |
Gain on divestiture of business | 4.6 | 0 | 4.6 | 0 |
Licensing income | 28.1 | 23.9 | 31.9 | 23.9 |
Other expense | (1) | (0.5) | (3) | (4.6) |
Other (expense) income, net | (3.8) | (10.8) | (32.6) | (78.9) |
Income before income taxes | 193.4 | 143.2 | 350.3 | 258.2 |
Income tax provision | (37.1) | (48.8) | (53.5) | (85.1) |
Net income | 156.3 | 94.4 | 296.8 | 173.1 |
Less: Net income attributable to non-controlling interest | (1) | (0.5) | (1.9) | (1) |
Net income attributable to ON Semiconductor Corporation | 155.3 | 93.9 | 294.9 | 172.1 |
Comprehensive income, net of tax: | ||||
Net income | 156.3 | 94.4 | 296.8 | 173.1 |
Foreign currency translation adjustments | (1.5) | 0.8 | 0.9 | 7.1 |
Effects of cash flow hedges | 1 | (1.5) | 4.8 | (0.7) |
Other comprehensive income (loss), net of tax | (0.5) | (0.7) | 5.7 | 6.4 |
Comprehensive income | 155.8 | 93.7 | 302.5 | 179.5 |
Comprehensive income attributable to non-controlling interest | (1) | (0.5) | (1.9) | (1) |
Comprehensive income attributable to ON Semiconductor Corporation | $ 154.8 | $ 93.2 | $ 300.6 | $ 178.5 |
Net income per common share attributable to ON Semiconductor Corporation: | ||||
Basic (in dollars per share) | $ 0.36 | $ 0.22 | $ 0.69 | $ 0.41 |
Diluted (in dollars per share) | $ 0.35 | $ 0.22 | $ 0.66 | $ 0.40 |
Weighted-average common shares outstanding: | ||||
Basic (in shares) | 427 | 420.8 | 426.5 | 420.4 |
Diluted (in shares) | 444.3 | 425.9 | 444.4 | 426 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 6 Months Ended | |
Jun. 29, 2018 | Jun. 30, 2017 | |
Cash flows from operating activities: | ||
Net income | $ 296.8 | $ 173.1 |
Adjustments to reconcile net income to net cash provided by operating activities and other adjustments: | ||
Depreciation and amortization | 245.4 | 230.8 |
Loss on sale or disposal of fixed assets | 2.4 | 1.8 |
Gain on divestiture of business | (4.6) | 0 |
Loss on debt refinancing and prepayment | 4 | 26.2 |
Amortization of debt discount and issuance costs | 6.7 | 8.4 |
Payments for term debt modification | (1.1) | (2.4) |
Write-down of excess inventories | 23.8 | 35.6 |
Share-based compensation expense | 41.5 | 35.9 |
Non-cash interest on convertible notes | 17.6 | 13.3 |
Goodwill and intangible asset impairment charges | 3.3 | 6.2 |
Change in deferred taxes | 43.2 | 57.2 |
Other | (1) | 2 |
Changes in assets and liabilities (exclusive of the impact of acquisition and divestiture): | ||
Receivables | (28.8) | (63.5) |
Inventories | (130.1) | (7.1) |
Other assets | (4.9) | (41.3) |
Accounts payable | 21.3 | 35.7 |
Accrued expenses | (29.8) | 139.8 |
Deferred income on sales to distributors | 0 | (109.8) |
Other long-term liabilities | (10.7) | (0.2) |
Net cash provided by operating activities | 495 | 541.7 |
Cash flows from investing activities: | ||
Purchases of property, plant and equipment | (252.4) | (121.7) |
Proceeds from sales of property, plant and equipment | 6 | 1.8 |
Deposits utilized (made) for purchases of property, plant and equipment | (13.7) | 1.1 |
Purchase of businesses, net of cash acquired | (70.7) | (0.8) |
Proceeds from divestiture of business, net of cash transferred | 5.6 | 0 |
Proceeds from repayment of note receivable | 10.2 | 0 |
Equity method investment | (19.8) | 0 |
Purchase of held-to-maturity securities | 0 | (1.6) |
Net cash used in investing activities | (334.8) | (121.2) |
Cash flows from financing activities: | ||
Proceeds from issuance of common stock under the ESPP | 6.9 | 11.3 |
Proceeds from exercise of stock options | 4.3 | 9.2 |
Payment of tax withholding for restricted shares | (19.9) | (13.6) |
Repurchase of common stock | (40) | (25) |
Proceeds from debt issuance | 7.5 | 695.9 |
Repayment of long-term debt | (215.4) | (1,191.3) |
Purchase of convertible note hedges | 0 | (144.7) |
Proceeds from issuance of warrants | 0 | 85.2 |
Payment of capital lease obligations | (3.2) | (6.5) |
Net cash used in financing activities | (259.8) | (579.5) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 0.7 | 2.2 |
Net decrease in cash, cash equivalents and restricted cash | (98.9) | (156.8) |
Cash, cash equivalents and restricted cash, beginning of period | 966.6 | 1,045.8 |
Cash, cash equivalents and restricted cash, end of period | $ 867.7 | $ 889 |
Background and Basis of Present
Background and Basis of Presentation | 6 Months Ended |
Jun. 29, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Background and Basis of Presentation | Note 1: Background and Basis of Presentation ON Semiconductor Corporation, together with its wholly-owned and majority-owned subsidiaries ("ON Semiconductor" or the "Company"), uses a thirteen-week fiscal quarter accounting period for the first three fiscal quarters of each year, with the second quarter of 2018 having ended on June 29, 2018 , and each fiscal year ending on December 31. The quarters ended June 29, 2018 and June 30, 2017 each contained 91 days. The six months ended June 29, 2018 and June 30, 2017 contained 180 and 181 days, respectively. During the quarter ended June 29, 2018, the Company changed the name of one of its operating and reporting segments from Image Sensor Group to Intelligent Sensing Group. As of June 29, 2018 , the Company was organized into the following three operating and reporting segments: the Power Solutions Group, the Analog Solutions Group and the Intelligent Sensing Group. Additional details on the Company’s operating and reporting segments are included in Note 2: ''Revenue and Segment Information.'' The accompanying unaudited financial statements as of and for the quarter and six months ended June 29, 2018 have been prepared in accordance with generally accepted accounting principles in the United States of America ("GAAP") for unaudited interim financial information. Accordingly, the unaudited financial statements do not include all of the information and footnotes required by GAAP for audited financial statements. The balance sheet as of December 31, 2017 was derived from the Company's audited financial statements but does not include all disclosures required by GAAP for audited financial statements. In the opinion of the Company's management, the interim information includes all adjustments, which includes normal recurring adjustments, necessary for a fair statement of the results for the interim periods. The footnote disclosures related to the interim financial information included herein are also unaudited. Such financial information should be read in conjunction with the consolidated financial statements and related notes thereto for the year ended December 31, 2017 included in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2017 , which was filed with the SEC on February 21, 2018 (the “ 2017 Form 10-K”). Financial results for interim periods are not necessarily indicative of the results of operations that may be expected for a full fiscal year. Adoption of New Revenue Standard On January 1, 2018, as required, the Company adopted ASU No. 2014-09 - Revenue from Contracts with Customers (Topic 606) ("ASU 2014-09"), ASU No. 2015-14 - Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date ("ASU 2015-14"), ASU No. 2016-08 - Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations ("ASU 2016-08"), ASU No. 2016-10 - Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing ("ASU 2016-10"), ASU No. 2016-12 - Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients ("ASU 2016-12") and ASU No. 2016-20 - Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers” ("ASU 2016-20") (collectively “the New Revenue Standard”). To conform to the New Revenue Standard, the Company modified its revenue recognition policy as described below. Change in Accounting Policy On January 1, 2018, the Company adopted the New Revenue Standard using the modified retrospective method, applying the guidance to all open contracts and recognized the cumulative effect adjustment of $2.1 million to retained earnings and accrued expenses as of that date. The comparative financial information has not been restated and continues to be presented under the accounting standards in effect for the respective periods. The Company applied the practical expedient and has not disclosed the revenues allocated to future shipments of partially completed contracts. Substantially all of the Company’s revenues continue to be recognized following the transfer of control of the products to the customer, which typically occurs upon shipment or delivery depending on the terms of the underlying contracts. Under the New Revenue Standard, revenues from certain product development agreements, which were previously deferred as delivered, are now recognized over time. During the quarter and six months ended June 29, 2018 , revenues increased by $1.0 million and $2.8 million , respectively, due to the impact of the adoption of the New Revenue Standard. Revenue Recognition Policy In anticipation of the adoption of the New Revenue Standard, during the quarter ended March 31, 2017, the Company developed its internal systems, processes and controls to enable it to make the estimates required by the New Revenue Standard on sales to its distributors and was able to reliably estimate upfront the effects of returns and allowances and record revenues at the time of shipments to these distributors. Prior to this, the Company recognized revenues from distributors under the sell-through method as it did not have the ability to estimate the effects of returns and allowances. As a result of this change, the Company recognized an additional $155.1 million in revenues during the first quarter of 2017, which resulted in an increase of $59.0 million to income before income taxes. The Company generates revenue from sales of its semiconductor products to OEMs, electronic manufacturing service providers and distributors. The Company also generates revenue, to a much lesser extent, from product development agreements and manufacturing services provided to customers. The Company recognizes revenue when it satisfies a performance obligation in an amount reflecting the consideration to which it expects to be entitled. For sales agreements, the Company has identified the promise to transfer products, each of which is distinct, to be the performance obligation. For product development agreements, the Company has identified the completion of a service defined in the agreement to be the performance obligation. The Company applies a five-step approach in determining the amount and timing of revenue to be recognized: (1) identifying the contract with a customer; (2) identifying the performance obligations in the contract; (3) determining the transaction price; (4) allocating the transaction price to the performance obligations in the contract; and (5) recognizing revenue when the performance obligation is satisfied. Substantially all of the Company’s revenue is recognized at the time control of the products transfers to the customer. Sales agreements with customers are renewable periodically and contain terms and conditions with respect to payment, delivery, warranty and supply, but typically do not require minimum purchase commitments. In the absence of a sales agreement, the Company’s standard terms and conditions apply. The Company considers the customer purchase orders, governed by sales agreements or the Company’s standard terms and conditions, to be the contract with the customer. The Company evaluates certain factors including the customer’s ability to pay (or credit risk). Most of the Company’s OEM customers negotiate pricing terms on an annual basis, while the electronic manufacturer service providers and distributors generally negotiate pricing terms on a quarterly basis. Pricing terms on product development agreements are negotiated at the beginning of a project. The Company allocates the transaction price to each distinct product based on its relative stand-alone selling price. In determining the transaction price, the Company evaluates whether the price is subject to refund or adjustment to determine the net consideration to which the Company expects to be entitled. The Company’s OEM customers do not have the right to return products, other than pursuant to the provisions of the Company’s standard warranty. Sales to distributors, however, are typically made pursuant to agreements that provide return rights with respect to discontinued or slow-moving products, referred to as stock rotation. Sales to distributors can also be subject to price adjustment on certain products, primarily for distributors with ship and credit rights. Although payment terms vary, most distributor agreements require payment within 30 days . In addition, the Company offers cash discounts to certain customers for payments received within an agreed upon time, generally 10 days after shipment. The Company recognizes revenue when it satisfies a performance obligation. The Company recognizes revenue from sales agreements upon transferring control of a product to the customer. This typically occurs when products are shipped or delivered, depending on the delivery terms, or when products that are consigned at customer locations are consumed. The Company recognizes revenue from product development agreements over time based on the cost-to-cost method. Revenues recognized during the quarter and six months ended June 29, 2018 , for sales agreements was $1,447.9 million and $2,820.7 million , respectively, and for product development agreements was $8.0 million and $12.8 million , respectively. Sales returns and allowances are estimated based on historical experience. Provisions for discounts and rebates to customers, estimated returns and allowances, ship and credit claims and other adjustments are provided for in the same period the related revenues are recognized, and are netted against revenues. For returns, the Company recognizes a related asset for the right to recover returned products with a corresponding reduction to cost of goods sold. The Company reviews warranty and related claims activity and records provisions, as necessary. The Company records a reserve for cash discounts as a reduction to accounts receivable and a reduction to revenues, based on the experience with each customer. Frequently, the Company receives orders with multiple delivery dates that may extend across reporting periods. Since each delivery constitutes a performance obligation, the Company allocates the transaction price of the contract to each performance obligation based on the stand-alone selling price of the products. The Company invoices the customer for each delivery upon shipment and recognizes revenue in accordance with delivery terms. As scheduled delivery dates are within one year, revenue allocated to future shipments of partially completed contracts are not disclosed. The Company has elected to record freight and handling costs associated with outbound freight after control over a product has transferred to a customer as a fulfillment cost and include it in cost of revenues. Taxes assessed by government authorities on revenue-producing transactions, including value-added and excise taxes, are presented on a net basis (excluded from revenues) in the Consolidated Statements of Operations and Comprehensive Income. The Company generally warrants that products sold to its customers will, at the time of shipment, be free from defects in workmanship and materials and conform to specifications. The Company’s standard warranty extends for a period of two years from the date of delivery, except in the case of image sensor products, which are warrantied for one year from the date of delivery. At the time revenue is recognized, the Company establishes an accrual for estimated warranty expenses associated with its sales and records them as a component of the cost of revenues. Use of Estimates The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Management evaluates these estimates and judgments on an ongoing basis and bases its estimates on experience, current and expected future conditions, third-party evaluations and various other assumptions that management believes are reasonable under the circumstances. Significant estimates have been used by management in conjunction with the following: (i) estimates of future payouts for customer incentives and estimates of amounts subject to allowances, returns and warranties; (ii) measurement of valuation allowances relating to inventories and trade receivables; (iii) future cash flows used to assess and test for impairment of goodwill and indefinite-lived intangible assets and long-lived assets, if applicable; (iv) assumptions surrounding future pension obligations; (v) fair values of share-based compensation and of financial instruments (including derivative financial instruments); (vi) measurement of valuation allowances against deferred tax assets, evaluations of uncertain tax positions and the impact of U.S. tax reform; and (vii) estimates and assumptions used in connection with business combinations. Actual results may differ from the estimates and assumptions used in the consolidated financial statements and related notes. Foreign Currencies Most of the Company’s foreign subsidiaries conduct business primarily in U.S. dollars and, as a result, utilize the dollar as their functional currency. For the remeasurement of financial statements of these subsidiaries, assets and liabilities in foreign currencies that are receivable or payable in cash are remeasured at current exchange rates, while inventories and other non-monetary assets in foreign currencies are remeasured at historical rates. Gains and losses resulting from the remeasurement of such financial statements are included in the operating results, as are gains and losses incurred on foreign currency transactions. Historically, the majority of the Company’s Japanese subsidiaries utilized Japanese Yen as their functional currency. The assets and liabilities of these subsidiaries are translated at current exchange rates, while revenues and expenses are translated at the average rates in effect for the period. The related translation gains and losses are included in other comprehensive income or loss within the Consolidated Statements of Operations and Comprehensive Income. As a result of an analysis which took into account the economic indicators of these subsidiaries from a long-term perspective, the Company changed the functional currency for some of these subsidiaries from Japanese Yen to U.S. dollars effective as of January 1, 2018. |
Revenue and Segment Information
Revenue and Segment Information | 6 Months Ended |
Jun. 29, 2018 | |
Segment Reporting [Abstract] | |
Revenue and Segment Information | Note 2: Revenue and Segment Information The Company is organized into three operating and reporting segments consisting of the Power Solutions Group, the Analog Solutions Group and the Intelligent Sensing Group. Each of the Company’s major product lines has been examined and assigned to a reporting segment based on the Company’s operating strategy. Because many products are sold into different end-markets, the total revenues reported for a segment is not indicative of actual sales in the end-market associated with that segment, but rather is the sum of the revenues from the product lines assigned to that segment. These segments represent the Company’s view of the business and as such are used to evaluate progress of major initiatives and allocation of resources. Revenues and gross profit for the Company’s operating and reporting segments were as follows (in millions): Power Solutions Group Analog Solutions Group Intelligent Sensing Group Total For the quarter ended June 29, 2018: Revenues from external customers $ 748.2 $ 513.2 $ 194.5 $ 1,455.9 Gross profit $ 267.1 $ 219.3 $ 82.6 $ 569.0 For the quarter ended June 30, 2017: Revenues from external customers $ 671.4 $ 468.5 $ 198.1 $ 1,338.0 Gross profit $ 228.5 $ 195.8 $ 74.9 $ 499.2 For the six months ended June 29, 2018: Revenues from external customers $ 1,440.8 $ 1,009.4 $ 383.3 $ 2,833.5 Gross profit $ 506.3 $ 426.1 $ 164.3 $ 1,096.7 For the six months ended June 30, 2017: Revenues from external customers $ 1,415.2 $ 972.1 $ 387.4 $ 2,774.7 Gross profit $ 472.5 $ 405.1 $ 142.3 $ 1,019.9 Gross profit shown above and below is exclusive of the amortization of acquisition-related intangible assets. Reconciliations of segment gross profit to consolidated gross profit are as follows (in millions): Quarters Ended Six Months Ended June 29, 2018 June 30, 2017 June 29, 2018 June 30, 2017 Gross profit for reporting segments $ 569.0 $ 499.2 $ 1,096.7 $ 1,019.9 Less: unallocated manufacturing costs (14.0 ) (7.2 ) (24.3 ) (24.8 ) Consolidated gross profit $ 555.0 $ 492.0 $ 1,072.4 $ 995.1 The Company operates in various geographic locations. Sales to unaffiliated customers have little correlation with the location of manufacturers. It is, therefore, not meaningful to present operating profit by geographical location. Revenues for the Company's operating and reporting segments disaggregated into geographic locations and sales channels were as follows (in millions): Quarter Ended June 29, 2018 Power Solutions Group Analog Solutions Group Intelligent Sensing Group Total Geographic Location United States $ 98.2 $ 85.9 $ 33.4 $ 217.5 United Kingdom 124.5 82.4 35.5 242.4 Hong Kong 229.4 133.1 42.4 404.9 Singapore 244.1 157.8 31.9 433.8 Other 52.0 54.0 51.3 157.3 Total $ 748.2 $ 513.2 $ 194.5 $ 1,455.9 Sales Channel OEM $ 219.8 $ 220.0 $ 69.0 $ 508.8 Distributors 482.0 257.5 115.3 854.8 Electronic Manufacturing Service Providers 46.4 35.7 10.2 92.3 Total $ 748.2 $ 513.2 $ 194.5 $ 1,455.9 Six Months Ended June 29, 2018 Power Solutions Group Analog Solutions Group Intelligent Sensing Group Total Geographic Location United States $ 192.7 $ 164.1 $ 59.9 $ 416.7 United Kingdom 243.1 161.5 71.4 476.0 Hong Kong 434.6 255.6 75.6 765.8 Singapore 472.5 319.0 75.2 866.7 Other 97.9 109.2 101.2 308.3 Total $ 1,440.8 $ 1,009.4 $ 383.3 $ 2,833.5 Sales Channel OEM $ 417.9 $ 427.6 $ 133.5 $ 979.0 Distributors 934.6 511.6 230.2 1,676.4 Electronic Manufacturing Service Providers 88.3 70.2 19.6 178.1 Total $ 1,440.8 $ 1,009.4 $ 383.3 $ 2,833.5 The Company’s consolidated assets are not specifically ascribed to its individual reporting segments. Rather, assets used in operations are generally shared across the Company’s operating and reporting segments. Property, plant and equipment, net by geographic location, is summarized as follows (in millions): As of June 29, 2018 December 31, 2017 United States $ 572.9 $ 547.9 Korea 396.9 380.5 Malaysia 225.0 230.0 Philippines 464.7 439.5 China 254.9 246.0 Other 472.8 435.2 Total $ 2,387.2 $ 2,279.1 For the quarters ended June 29, 2018 and June 30, 2017 , no single customer, including any distributor, accounted for 10% or more of the Company's total consolidated revenues. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 6 Months Ended |
Jun. 29, 2018 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | Note 3: Recent Accounting Pronouncements ASUs Adopted: New Revenue Standard The Company adopted the New Revenue Standard on a modified retrospective basis on January 1, 2018. The cumulative-effect adjustment related to the timing of revenue recognition on certain product development agreements recorded to beginning retained earnings as of January 1, 2018, was $2.1 million . The Company expects the ongoing impact of the New Revenue Standard to be immaterial to the consolidated financial statements. ASU No. 2017-09 - Scope of Modification Accounting ("ASU 2017-09") In May 2017, the FASB issued ASU No. 2017-09 to reduce diversity in practice and provide clarity regarding existing guidance in ASC 718, “Stock Compensation.” The amendments clarify that an entity should apply modification accounting in response to a change in the terms and conditions of an entity’s share-based payment awards unless three newly specified criteria are met. The amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company adopted ASU 2017-09 during the first quarter of 2018. The adoption of this standard did not have a material impact on the consolidated financial statements. ASU No 2017-07 - Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost ("ASU 2017-07") In March 2017, the FASB issued ASU 2017-07 primarily to improve the presentation of net periodic pension cost and net periodic postretirement benefit cost. The guidance will require the net benefit cost to be split in the income statement. The service cost component will be included in operating income. The other components, including amortization of past service costs or credits and settlement and curtailments amounts, will be reported separately outside of operating income. The amendment is effective for fiscal years beginning after December 15, 2017. The Company adopted ASU 2017-07 during the first quarter of 2018, applying the standard retrospectively to all periods presented. The adoption of this standard did not have a material impact on the current period or prior period consolidated financial statements. See Note 6: ''Balance Sheet Information'' for further information on the adoption of ASU 2017-07. ASU No. 2016-18 - Statement of Cash Flows (Topic 230): Restricted Cash (a consensus of the FASB Emerging Issues Task Force) ("ASU 2016-18") In November 2016, the FASB issued ASU 2016-18, which requires entities to include in their cash and cash-equivalent balances in the statement of cash flows those amounts that are deemed to be restricted cash and restricted cash equivalents. The ASU does not define the terms “restricted cash” and “restricted cash equivalents.” The amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company adopted ASU 2016-18 during the first quarter of 2018, applying the standard retrospectively to all periods presented. The adoption of this standard did not have a material impact on the current period or prior period consolidated financial statements. See Note 15: ''Supplemental Disclosures'' for further information on the adoption of ASU 2016-18. ASU No. 2016-16 - Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory ("ASU 2016-16") In October 2016, the FASB issued ASU 2016-16, which eliminates the exception for all intra-entity sales of assets other than inventory. As a result, a reporting entity would recognize the tax expense from the sale of the asset in the seller’s tax jurisdiction when the transfer occurs, even though the pre-tax effects of that transaction are eliminated in consolidation. Any deferred tax asset that arises in the buyer’s jurisdiction would also be recognized at the time of the transfer. The new guidance does not apply to intra-entity transfers of inventory. The income tax consequences from the sale of inventory from one member of a consolidated entity to another will continue to be deferred until the inventory is sold to a third party. The amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company adopted ASU 2016-16 during the first quarter of 2018. The adoption of this standard did not have a material impact on the consolidated financial statements. ASU No. 2016-15 - Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments ("ASU 2016-15") In August 2016, the FASB issued ASU 2016-15, which changes how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company adopted ASU 2016-15 during the first quarter of 2018. The adoption of this standard did not have a material impact on the consolidated financial statements. ASUs Pending Adoption: ASU No. 2017-12 - Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities ("ASU 2017-12") In August 2017, the FASB issued ASU No. 2017-12 to better align hedge accounting with risk management strategies, and as a result, more hedging strategies will be eligible for hedge accounting. Public business entities will have until the end of the first quarter in which a hedge is designated to perform an initial assessment of a hedge’s effectiveness. After initial qualification, the new guidance permits a qualitative effectiveness assessment for certain hedges instead of a quantitative test if the company can reasonably support an expectation of high effectiveness throughout the term of the hedge. An initial quantitative test to establish that the hedge relationship is highly effective is still required. The amendments are effective for fiscal years beginning after December 15, 2018. Early adoption is permitted. The Company does not anticipate the adoption of ASU 2017-12 will have a material impact on its consolidated financial statements. ASU No. 2016-02 - Leases (Topic 842) ("ASU 2016-02") In February 2016, the FASB issued ASU 2016-02, which amends the accounting treatment for leases. Lessees (for capital and operating leases) and lessors (for sales-type leases, direct financing leases and operating leases) must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. Lessees and lessors may not apply a full retrospective transition approach. The amendments are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. The Company expects the adoption of this standard will result in a significant component of the Company's future minimum lease obligations as disclosed in Note 10: ''Commitments and Contingencies'' to be included on its Consolidated Balance Sheets. The Company is currently reviewing its service agreements and other arrangements to evaluate whether they meet the definition of a lease under ASU 2016-02 and what additional impact that the adoption of ASU 2016-02 may have on its consolidated financial statements. |
Acquisitions, Divestitures and
Acquisitions, Divestitures and Licensing Transactions Acquisitions, Divestitures and Licensing Transactions | 6 Months Ended |
Jun. 29, 2018 | |
Business Combinations [Abstract] | |
Acquisitions, Divestitures and Licensing Transactions | Note 4: Acquisitions, Divestitures and Licensing Transactions Acquisition On May 8, 2018, the Company acquired 100% of the outstanding shares of SensL Technologies Ltd. ("SensL"), a company specializing in Silicon Photomultipliers, Single Photon Avalanche Diode and LiDAR sensing products for the automotive, medical, industrial and consumer markets, for $71.4 million in cash, subject to certain adjustments. As a result of the acquisition, SensL became a wholly-owned subsidiary of the Company. The purchase price was funded with cash on hand. This acquisition positions the Company to extend its products in automotive sensing applications for ADAS and autonomous driving by adding LiDAR capabilities to the Company’s existing capabilities in imaging and radar. The following table presents the provisional allocation of the purchase price of SensL for the assets acquired and liabilities assumed based on their fair values (in millions): Initial Estimate Current assets (including cash and cash equivalents of $0.7 million) $ 4.2 Property, plant and equipment and other non-current assets 1.8 Goodwill 15.2 Intangible assets (excluding IPRD) 30.4 IPRD 25.0 Total assets acquired 76.6 Current liabilities 0.7 Other non-current liabilities 4.5 Total liabilities assumed 5.2 Net assets acquired/purchase price $ 71.4 Acquired intangible assets of $30.4 million include developed technology of $29.0 million (which are estimated to have a six year weighted-average useful life). The total weighted average amortization period for the acquired intangibles is six years. IPRD assets are amortized over the estimated useful life of the assets upon successful completion of the related projects. The value assigned to IPRD was determined by estimating the net cash flows from the projects when completed and discounting the net cash flows to their present value using a discount rate of 29.5% . The cash flows from IPRD’s significant products are expected to commence in the second half of 2018. The acquisition produced $15.2 million of goodwill, which was allocated to the Intelligent Sensing Group. The goodwill is attributable to a combination of SensL’s assembled workforce, expectations regarding a more meaningful engagement by the customers due to the scale of the combined company and other product and operating synergies. Goodwill will not be amortized but instead tested for impairment at least annually (more frequently if certain indicators are present). Goodwill arising from the SensL acquisition is not deductible for tax purposes. The initial estimated purchase price allocation is subject to change as the Company finalizes its determination relating to the valuation of net assets and finalizes key assumptions, approaches and judgments with respect to intangible assets acquired from SensL. Accordingly, future adjustments may impact the initial estimated amount of goodwill and other allocated amounts represented in the table above. Divestiture On June 25, 2018, the Company divested the transient voltage suppressing diodes business it acquired from Fairchild to TSC America, Inc. for $5.6 million in cash and recorded a gain of $4.6 million after writing off the carrying values of the assets and liabilities disposed. This gain has been presented as “Gain on divestiture of business” in the Consolidated Statements of Operations and Comprehensive Income for the quarter and six months ended June 29, 2018. Licensing Transactions During 2016 and 2017, the Company entered into an Asset Purchase Agreement with Huaian Imaging Device Manufacturer Corporation (“HIDM”) pursuant to which the Company received $52.5 million in cash in 2017 and provided perpetual, non-exclusive licenses relating to certain technologies to HIDM. Of this amount, $10.0 million was recorded as deferred licensing income to be recognized in the period in which certain qualification requirements of the technologies are achieved (or refunded to HIDM, if such qualification did not occur by June 21, 2018). During the quarter ended June 29, 2018, the Company achieved such qualification requirements for the technologies transferred and recognized $10.0 million as licensing income. On November 29, 2017, the Company and QST Co. Ltd (“QST”) entered into an IP license and technology transfer agreement (“IP Agreement”) to grant QST patent licenses and IP rights to certain of the Company’s technologies. Pursuant to the IP Agreement, QST receives perpetual, worldwide, nonexclusive and nontransferable patents licenses and IP rights upon the payment of license fees of $13.0 million and other fees of $8.5 million in its entirety. Such amounts were paid by QST between the fourth quarter of 2017 and the first and second quarters of 2018. As a result, the Company has recognized licensing income of $18.0 million during the quarter ended June 29, 2018. The remaining amounts were previously recognized as licensing income during 2017 and the quarter ended March 30, 2018. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 6 Months Ended |
Jun. 29, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Note 5: Goodwill and Intangible Assets Goodwill The following table summarizes goodwill by operating and reporting segments (in millions): As of June 29, 2018 December 31, 2017 Goodwill Accumulated Impairment Losses Carrying Value Goodwill Accumulated Impairment Losses Carrying Value Operating and Reporting Segments: Power Solutions Group $ 432.2 $ (31.9 ) $ 400.3 $ 432.2 $ (28.6 ) $ 403.6 Analog Solutions Group 836.7 (418.9 ) 417.8 836.7 (418.9 ) 417.8 Intelligent Sensing Group 110.7 — 110.7 95.5 — 95.5 $ 1,379.6 $ (450.8 ) $ 928.8 $ 1,364.4 $ (447.5 ) $ 916.9 The following table summarizes the change in goodwill from December 31, 2017 to June 29, 2018 (in millions): Net balance as of December 31, 2017 $ 916.9 Addition due to business combination 15.2 Goodwill impairment (3.3 ) Net balance as of June 29, 2018 $ 928.8 During the quarter ended June 29, 2018 , the Company recorded a goodwill impairment charge of $3.3 million , which represented the entire goodwill assigned to a reporting unit within the Power Solutions Group as a result of the licensing transaction with QST. See Note 4: ''Acquisitions, Divestitures and Licensing Transactions'' for more information. Goodwill is tested for impairment annually on the first day of the fourth quarter or more frequently if events or changes in circumstances (each, a "triggering event") would more likely than not reduce the carrying value of goodwill below its fair value. Management did not identify any triggering events through June 29, 2018 that would require an interim impairment analysis. Intangible Assets Intangible assets, net, were as follows (in millions): As of June 29, 2018 Original Cost Accumulated Amortization Accumulated Impairment Losses Carrying Value Customer relationships $ 556.7 $ (343.8 ) $ (20.1 ) $ 192.8 Developed technology 686.6 (316.8 ) (2.6 ) 367.2 IPRD 79.5 — (19.0 ) 60.5 Other intangibles 79.9 (57.3 ) (15.2 ) 7.4 Total intangible assets $ 1,402.7 $ (717.9 ) $ (56.9 ) $ 627.9 As of December 31, 2017 Original Cost Accumulated Amortization Accumulated Impairment Losses Carrying Value Customer relationships $ 555.9 $ (328.5 ) $ (20.1 ) $ 207.3 Developed technology 657.6 (278.2 ) (2.6 ) 376.8 IPRD 54.5 — (19.0 ) 35.5 Other intangibles 79.8 (55.9 ) (15.2 ) 8.7 Total intangible assets $ 1,347.8 $ (662.6 ) $ (56.9 ) $ 628.3 Amortization expense for acquisition-related intangible assets amounted to $ 27.9 million and $55.3 million for the quarter and six months ended June 29, 2018 , respectively, and $28.6 million and $57.7 million for the quarter and six months ended June 30, 2017 , respectively. Amortization expense for intangible assets, with the exception of the $60.5 million of IPRD assets that will be amortized once the corresponding projects have been completed, is expected to be as follows for the remainder of 2018 , each of the next four years and thereafter (in millions): Period Amortization Expense Remainder of 2018 $ 57.1 2019 104.9 2020 89.9 2021 75.1 2022 62.9 Thereafter 177.5 Total amortization expense $ 567.4 |
Balance Sheet Information
Balance Sheet Information | 6 Months Ended |
Jun. 29, 2018 | |
Balance Sheet Related Disclosures [Abstract] | |
Balance Sheet Information | Note 6: Balance Sheet Information Certain significant amounts included in the Company's Consolidated Balance Sheets consist of the following (in millions): As of June 29, 2018 December 31, 2017 Receivables, net: Accounts receivable $ 700.6 $ 704.2 Less: Allowance for doubtful accounts (1.8 ) (2.7 ) $ 698.8 $ 701.5 Inventories: Raw materials $ 135.4 $ 117.7 Work in process 760.4 660.8 Finished goods 308.6 311.0 $ 1,204.4 $ 1,089.5 Property, plant and equipment, net: Land $ 148.5 $ 148.4 Buildings 770.1 744.0 Machinery and equipment 3,687.0 3,454.6 Property, plant and equipment, gross 4,605.6 4,347.0 Less: Accumulated depreciation (2,218.4 ) (2,067.9 ) $ 2,387.2 $ 2,279.1 Accrued expenses: Accrued payroll and related benefits $ 185.5 $ 201.8 Sales related reserves 261.2 280.0 Income taxes payable 20.7 29.9 Other 96.5 101.1 $ 563.9 $ 612.8 Assets classified as held-for-sale, consisting of properties, are required to be recorded at the lower of carrying value or fair value less costs to sell. The carrying value of these assets as of June 29, 2018 and December 31, 2017 was $ 1.4 million and $5.3 million , respectively, and is reported as other current assets on the Company’s Consolidated Balance Sheets. The Company sold the assets held-for-sale at December 31, 2017 in January 2018 for $5.5 million . Warranty Reserves The activity related to the Company's warranty reserves was as follows (in millions): Six Months Ended June 29, 2018 June 30, 2017 Beginning Balance $ 8.0 $ 8.8 Provision (0.3 ) 2.2 Usage (0.8 ) (3.6 ) Ending Balance $ 6.9 $ 7.4 Defined Benefit Plans The Company maintains defined benefit plans for certain of its foreign subsidiaries. The Company recognizes the aggregate amount of all overfunded plans as assets and the aggregate amount of all underfunded plans as liabilities in its financial statements. As of June 29, 2018 , the total accrued pension liability for underfunded plans was $110.4 million , of which the current portion of $0.3 million was classified as accrued expenses. As of December 31, 2017 , the total accrued pension liability for underfunded plans was $ 109.3 million , of which the current portion of $ 0.2 million was classified as accrued expenses. The components of the Company's net periodic pension expense are as follows (in millions): Quarters Ended Six Months Ended June 29, 2018 June 30, 2017 June 29, 2018 June 30, 2017 Service cost $ 2.4 $ 2.3 $ 4.9 $ 4.6 Interest cost 1.2 1.1 2.4 2.1 Expected return on plan assets (1.5 ) (1.3 ) (3.1 ) (2.6 ) Total net periodic pension cost $ 2.1 $ 2.1 $ 4.2 $ 4.1 With the retrospective adoption of ASU 2017-07, the service cost component is included in operating income while the other components, including the interest cost and the expected return on plan assets, are reported separately outside of operating income. The Company utilized the practical expedient to estimate the amounts for the comparative periods using the information previously disclosed in the notes to the consolidated financial statements in the 2017 Form 10-K. The service cost is allocated between the cost of revenues, research and development, selling and marketing and general and administrative line items, while the other components are included in other expense in the Consolidated Statements of Operations and Comprehensive Income. |
Long-Term Debt
Long-Term Debt | 6 Months Ended |
Jun. 29, 2018 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Note 7: Long-Term Debt The Company's long-term debt consists of the following (annualized interest rates, in millions): As of June 29, 2018 December 31, 2017 Amended Credit Agreement: Revolving Credit Facility due 2021, interest payable monthly at 3.34% and 3.07%, respectively $ 400.0 $ 400.0 Term Loan “B” Facility due 2023, interest payable monthly at 3.84% and 3.57%, respectively 1,154.5 1,204.5 1.00% Notes due 2020 (1) 690.0 690.0 1.625% Notes due 2023 (2) 575.0 575.0 Note payable to SMBC due 2016 through 2018, interest payable quarterly at 0% and 3.09%, respectively (3) — 122.7 Other long-term debt (4) 144.6 182.8 Gross long-term debt, including current maturities 2,964.1 3,175.0 Less: Debt discount (5) (159.2 ) (178.8 ) Less: Debt issuance costs (6) (38.1 ) (44.4 ) Net long-term debt, including current maturities 2,766.8 2,951.8 Less: Current maturities (746.4 ) (248.1 ) Net long-term debt $ 2,020.4 $ 2,703.7 _______________________ (1) Interest is payable on June 1 and December 1 of each year at 1.00% annually. (2) Interest is payable on April 15 and October 15 of each year at 1.625% annually. (3) This loan represented SCI LLC's non-collateralized loan with SMBC, which was guaranteed by the Company. (4) Consists of U.S. real estate mortgages, term loans, revolving lines of credit and other facilities at certain international locations where interest is payable weekly, monthly or quarterly, interest rates range between 1.00% and 5.00% , with maturity dates between 2018 and 2020. (5) Debt discount of $52.0 million and $62.0 million for the 1.00% Notes, $96.7 million and $104.3 million for the 1.625% Notes and $10.5 million and $12.5 million for the Term Loan "B" Facility, in each case as of June 29, 2018 and December 31, 2017 , respectively. (6) Debt issuance costs of $7.3 million and $8.6 million for the 1.00% Notes, $9.3 million and $10.0 million for the 1.625% Notes and $21.5 million and $25.8 million for the Term Loan "B" Facility, in each case as of June 29, 2018 and December 31, 2017 , respectively. Expected maturities relating to the Company’s long-term debt (including current maturities) as of June 29, 2018 are as follows (in millions): Period Expected Maturities Remainder of 2018 $ 802.4 2019 31.2 2020 1.0 2021 400.0 2022 — Thereafter 1,729.5 Total $ 2,964.1 Fourth Amendment to Credit Agreement On May 31, 2018, the Company and certain of the Company’s subsidiaries, as guarantors (the “Guarantors”), entered into the Fourth Amendment (the “Fourth Amendment”) to the Credit Agreement, dated as of April 15, 2016, as amended by the First Amendment to the Credit Agreement, dated as of September 30, 2016, the Second Amendment to the Credit Agreement, dated as of March 31, 2017, and the Third Amendment to the Credit Agreement, dated as of November 30, 2017 (as amended, the “Credit Agreement”), with the several lenders party thereto and Deutsche Bank AG New York Branch, as the administrative agent (the “Agent”). Borrowings under the Credit Agreement may be incurred in U.S. Dollars, Euros, Pounds Sterling, Japanese Yen or any other currency approved by the Agent and the lenders under a $1.0 billion revolving credit facility (the "Revolving Credit Facility"), subject to certain qualifications described in the Credit Agreement. Regardless of currency, all borrowings under the Credit Agreement, may, at the Company’s option, be incurred as either eurocurrency loans (“Eurocurrency Loans”) or alternate base rate loans (“ABR Loans”). Pursuant to the Credit Agreement, for any interest period ending after the date of the Fourth Amendment, Eurocurrency Loans will accrue interest at (i) a base rate per annum equal to the Adjusted LIBO Rate (as defined in the Credit Agreement) plus (ii) an applicable margin equal to (x) 1.25% with respect to borrowings under the Revolving Credit Facility (with step-downs and step-ups as set forth in the Credit Agreement) or (y) 1.75% with respect to borrowings under a $2.4 billion term loan “B” facility (the "Term Loan “B” Facility"). Pursuant to the Credit Agreement, ABR Loans will accrue interest at (i) a base rate per annum equal to the highest of (x) the Federal funds rate plus 0.50% , (y) the prime commercial lending rate announced by the Agent from time to time as its prime lending rate and (z) the Adjusted LIBO Rate for a one month interest period (or if such day is not a business day, the immediately preceding business day) (determined after giving effect to any applicable “floor”) plus 1.00% ; provided that, the Adjusted LIBO Rate for any day shall be based on the LIBO Rate (as defined in the Credit Agreement), subject to the interest rate floors set forth in the Credit Agreement, plus (ii) an applicable margin equal to (x) 0.25% with respect to borrowings under the Revolving Credit Facility (with step downs and step-ups as set forth in the Credit Agreement) or (y) 0.75% with respect to borrowings under the Term Loan “B” Facility. The obligations under the Credit Agreement are guaranteed by the Guarantors and collateralized by a pledge of substantially all of the assets of the Company and the Guarantors, including a pledge of the equity interests in certain of the Company’s domestic and first tier foreign subsidiaries, subject to customary exceptions. The obligations under the Credit Agreement are also collateralized by mortgage on certain real property assets of the Company and its domestic subsidiaries. The Credit Agreement includes financial maintenance covenants, including, among others, a maximum total net leverage ratio and a minimum interest coverage ratio. It also contains other customary affirmative and negative covenants and events of default. The Company was in compliance with its covenants as of June 29, 2018 . Debt Refinancing and Prepayment The Company incurred third party, legal and other fees of $1.1 million related to the Fourth Amendment. The Company performed an analysis and recorded a debt extinguishment charge of $2.6 million , which included a write-off of $1.5 million of unamortized debt discount and issuance costs and $1.1 million in third party fees, as previously mentioned. During the quarter ended June 29, 2018, the Company prepaid $50.0 million of borrowings under the Term Loan “B” Facility and expensed $1.4 million of unamortized debt discount and issuance costs attributed to the partial pay-down, as loss on debt refinancing and prepayment. 1.00% Notes due 2020 On June 8, 2015, the Company completed a private placement of $690.0 million of its 1.00% Notes to qualified institutional buyers pursuant to Rule 144A under the Securities Act. The 1.00% Notes are governed by an indenture between the Company, as the issuer, the guarantors named therein and Wells Fargo Bank, National Association, as trustee (the “ 1.00% Indenture”). The 1.00% Notes are convertible by holders into cash and shares of the Company’s common stock at a conversion rate of 54.0643 shares of common stock per $1,000 principal amount of notes (subject to adjustment in certain events), which is equivalent to an initial conversion price of $18.50 per share of common stock. The Company will settle conversion of all 1.00% Notes validly tendered for conversion in cash, shares of the Company’s common stock or a combination of cash and shares to be determined by the Company. Holders may convert their 1.00% Notes only under the following circumstances: (i) during any calendar quarter commencing after the calendar quarter ending on September 30, 2015, if the last reported sale price of common stock for at least 20 trading days (whether or not consecutive) during the period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; (ii) during the five business-day period immediately following any five consecutive trading-day period in which the trading price per $1,000 principal amount of 1.00% Notes for each day of such period was less than 98% of the product of the closing sale price of the Company’s common stock and the conversion rate; (iii) upon occurrence of the specified transactions described in the 1.00% Indenture; or (iv) on and after September 1, 2020 (each considered a "trigger"). Upon conversion of the 1.00% Notes, the Company will deliver cash, shares of its common stock or a combination of cash and shares of its common stock, at the Company’s election. As previously experienced during the quarter ended March 30, 2018, the last reported sale price of the Company’s common stock for at least 20 trading days during the period of 30 consecutive trading days ending on June 30, 2018 was greater than or equal to $24.05 ( 130% of the conversion price) on each applicable trading day. As a result, the Company recorded the outstanding balance, net of discount, of $630.7 million of the 1.00% Notes as a current portion of long-term debt as of June 29, 2018 , and as required by the 1.00% Indenture, gave notice to the trustee, the conversion agent and each holder on June 29, 2018 that each holder has the right to surrender any portion of its 1.00% Notes (in minimum denominations of $1,000 in principal amount or an integral multiple thereof) for conversion during the calendar quarter ending September 30, 2018 (and only during such calendar quarter unless the trigger remains) pursuant to the terms of the 1.00% Indenture. Note Payable to SMBC On January 31, 2013, the Company amended and restated its seven -year, non-collateralized loan obligation with SANYO Electric. In connection with the amendment and restatement of the loan agreement, SANYO Electric assigned all of its rights under the loan agreement to SMBC. The loan had an original principal amount of approximately $377.5 million and had a principal balance of $122.7 million as of December 31, 2017. The entire balance was repaid on the due date of January 2, 2018. |
Earnings Per Share and Equity
Earnings Per Share and Equity | 6 Months Ended |
Jun. 29, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Share and Equity | Note 8: Earnings Per Share and Equity Earnings Per Share Calculations of net income per common share attributable to ON Semiconductor are as follows (in millions, except per share data): Quarters Ended Six Months Ended June 29, 2018 June 30, 2017 June 29, 2018 June 30, 2017 Net income attributable to ON Semiconductor Corporation $ 155.3 $ 93.9 $ 294.9 $ 172.1 Basic weighted-average common shares outstanding 427.0 420.8 426.5 420.4 Dilutive effect of share-based awards 4.6 5.1 5.2 5.6 Dilutive effect of convertible notes 12.7 — 12.7 — Diluted weighted-average common shares outstanding 444.3 425.9 444.4 426.0 Net income per common share attributable to ON Semiconductor Corporation: Basic $ 0.36 $ 0.22 $ 0.69 $ 0.41 Diluted $ 0.35 $ 0.22 $ 0.66 $ 0.40 Basic income per common share is computed by dividing net income attributable to ON Semiconductor Corporation by the weighted average number of common shares outstanding during the period. The number of incremental shares from the assumed exercise of stock options and assumed issuance of shares relating to RSUs is calculated by applying the treasury stock method. Share-based awards whose impact is considered to be anti-dilutive under the treasury stock method were excluded from the diluted net income per share calculation. The excluded number of anti-dilutive shares subject to share-based awards was zero for the quarters ended June 29, 2018 and June 30, 2017 and 0.3 million and 0.5 million for the six months ended June 29, 2018 and June 30, 2017 , respectively. The dilutive impact related to the Company's 1.00% Notes and 1.625% Notes is determined in accordance with the net share settlement requirements prescribed by ASC Topic 260, Earnings Per Share . Under the net share settlement calculation, the Company's convertible notes are assumed to be convertible into cash up to the par value, with the excess of par value being convertible into common stock. A dilutive effect occurs when the stock price exceeds the conversion price for each series of the convertible notes. During the quarter ended June 29, 2018 , the average share price exceeded the conversion price for both the 1.00% Notes and the 1.625% Notes and the impact of the excess over par value is included in calculating the dilutive effect of the convertible notes. In periods when the share price is lower than the conversion price, the impact is anti-dilutive and therefore has no impact on the Company's earnings per share calculations. Additionally, if the average price of the Company's common stock exceeds $25.96 per share, with respect to the 1.00% Notes, or $30.70 per share, with respect to the 1.625% Notes, for a reporting period, the Company will also include the effect of the additional potential shares, using the treasury stock method, that may be issued related to the warrants that were issued concurrently with the issuance of the 1.00% Notes and 1.625% Notes, respectively. Prior to conversion, the convertible note hedges are not considered for purposes of the earnings per share calculations, as their effect would be anti-dilutive. Upon conversion, the convertible note hedges are expected to offset the dilutive effect of the 1.00% Notes and 1.625% Notes, respectively, when the stock price is above $18.50 per share, with respect to the 1.00% Notes, and $20.72 per share, with respect to the 1.625% Notes. Equity Share Repurchase Program During the quarter and six months ended June 29, 2018, the Company repurchased common stock worth approximately $40.0 million under the share repurchase program. There were zero and $25.0 million of repurchases of the Company's common stock under the share repurchase program during the quarter and six months ended June 30, 2017 . Under the share repurchase program, the Company may repurchase up to $1.0 billion (exclusive of fees, commissions and other expenses) of the Company’s common stock over a period of four years from December 1, 2014, subject to certain contingencies. The Company may repurchase its common stock from time to time in privately negotiated transactions or open market transactions, including pursuant to a trading plan in accordance with Rule 10b5-1 and Rule 10b-18 of the Exchange Act, or by any combination of such methods or other methods. The timing of any repurchases and the actual number of shares repurchased will depend on a variety of factors, including the Company’s stock price, corporate and regulatory requirements, restrictions under the Company’s debt obligations and other market and economic conditions. The share repurchase program does not require the Company to purchase any particular amount of common stock and is subject to the board’s discretion. As of June 29, 2018, $563.2 million remained of the total authorized amount to repurchase common stock pursuant to the share repurchase program. Information relating to the Company's share repurchase program during the quarter and six months ended June 29, 2018 , is as follows (in millions, except per share data): Quarter Ended Six Months Ended June 29, 2018 June 29, 2018 Number of repurchased shares (1) 1.7 1.7 Aggregate purchase price $ 40.0 $ 40.0 Weighted-average purchase price per share (2) $ 23.34 $ 23.34 Available for future purchases at June 29, 2018 $ 563.2 $ 563.2 (1) None of these shares had been reissued or retired as of June 29, 2018 , but may be reissued or retired by the Company at a later date. (2) Exclusive of fees, commissions and other expenses. Shares for Restricted Stock Units Tax Withholding Treasury stock is recorded at cost and is presented as a reduction of stockholders' equity in the accompanying consolidated financial statements. Shares with a fair market value equal to the applicable statutory minimum amount of the employee withholding taxes due are withheld by the Company upon the vesting of RSUs to pay the applicable statutory minimum amount of employee withholding taxes and are considered common stock repurchases. The Company then pays the applicable statutory minimum amount of withholding taxes in cash. The amount remitted for the quarter and six months ended June 29, 2018 was $1.1 million and $19.9 million , respectively, for which the Company withheld approximately 0.1 million and 0.8 million shares of common stock, respectively, that were underlying the RSUs that vested. The amount remitted for the quarter and six months ended June 30, 2017 was $0.6 million and $13.6 million , respectively, for which the Company withheld approximately 0.1 million and 0.9 million shares of common stock, respectively, that were underlying the RSUs that vested. None of these shares had been reissued or retired as of June 29, 2018 , but may be reissued or retired by the Company at a later date. These repurchases do not count against the Company's share repurchase program. Non-Controlling Interest The Company's entity, which operates assembly and test operations in Leshan, China is owned by Leshan-Phoenix Semiconductor Company Limited, a joint venture company in which the Company owns a majority of the outstanding equity interests (“Leshan”). The Company owns 80% of the outstanding equity interests in Leshan and its investment in Leshan has been consolidated in the Company's financial statements. At December 31, 2017 , the non-controlling interest balance was $ 22.2 million . This balance increased to $24.1 million as of June 29, 2018 , resulting from the non-controlling interest's $1.9 million share of the earnings for the six months ended June 29, 2018 . Subsequent to the third closing date of Aizu Fujitsu Semiconductor Manufacturing Limited (“AFSM”), the Company will consolidate the results of AFSM and the non-controlling interest held by the minority shareholder will be initially recognized at fair value. See Note 11: ''Fair Value Measurements'' for further information about the investment in AFSM. |
Share-Based Compensation
Share-Based Compensation | 6 Months Ended |
Jun. 29, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Compensation | Note 9: Share-Based Compensation Total share-based compensation expense related to the Company's stock options, RSUs, stock grant awards and ESPP were recorded within the Consolidated Statements of Operations and Comprehensive Income as follows (in millions): Quarters Ended Six Months Ended June 29, 2018 June 30, 2017 June 29, 2018 June 30, 2017 Cost of revenues $ 1.8 $ 1.5 $ 3.4 $ 3.0 Research and development 4.0 3.5 7.2 6.4 Selling and marketing 4.0 3.2 7.2 6.0 General and administrative 13.3 12.6 23.7 20.5 Share-based compensation expense before income taxes $ 23.1 $ 20.8 $ 41.5 $ 35.9 Related income tax benefits (1) 4.9 7.3 8.7 12.6 Share-based compensation expense, net of taxes $ 18.2 $ 13.5 $ 32.8 $ 23.3 (1) Tax benefit was calculated using the federal statutory rate of 21% and 35% for the quarters and six months ended June 29, 2018 and June 30, 2017 , respectively. At June 29, 2018 , total unrecognized share-based compensation expense, net of estimated forfeitures, related to non-vested RSUs with time-based service conditions and performance-based vesting criteria was $112.0 million , which is expected to be recognized over a weighted-average period of 1.76 years. The total intrinsic value of stock options exercised during the quarter and six months ended June 29, 2018 was $ 1.1 million and $10.5 million , respectively. The Company received cash of $0.6 million and $4.3 million , respectively, during the quarter and six months ended June 29, 2018 from the exercise of stock options. Upon option exercise, vesting of RSUs, stock grant awards or completion of a purchase under the ESPP, the Company issues new shares of common stock. Share-based compensation expense is based on awards that are ultimately expected to vest. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The annualized pre-vesting forfeiture rate for stock options was estimated to be 11% during the quarters and six months ended June 29, 2018 and June 30, 2017 . The annualized pre-vesting forfeiture rate for RSUs was estimated to be 5% during the quarters and six months ended June 29, 2018 and June 30, 2017 . Shares Available As of June 29, 2018 , there was an aggregate of 35.0 million shares of common stock available for grant under the Amended and Restated SIP and 7.6 million shares available for issuance under the ESPP. As of December 31, 2017 , there was an aggregate of 39.0 million shares of common stock available for grant under the Company's Amended and Restated SIP and 8.0 million shares available for issuance under the ESPP. Stock Options The number of options outstanding at December 31, 2017 was 1.1 million at a weighted average exercise price of $6.95 per option, of which 0.6 million options were exercised at a weighted average exercise price of $7.01 per option during the six months ended June 29, 2018 . The number of options outstanding at June 29, 2018 was 0.5 million at a weighted average exercise price of $6.87 per option. All outstanding options had exercise prices below $22.24 per share, the closing price of the Company's common stock at June 29, 2018 . Restricted Stock Units RSUs generally vest over three years with service-based requirements or performance-based requirements or a combination of service-based and performance-based requirements and are payable in shares of the Company's common stock upon vesting. A summary of the RSU transactions for the six months ended June 29, 2018 is as follows (in millions, except per share data): Number of Shares Weighted-Average Grant Date Fair Value Per Share Non-vested RSUs at December 31, 2017 9.8 $ 12.63 Granted 2.8 24.39 Released (2.7 ) 12.22 Forfeited (0.3 ) 14.55 Non-vested RSUs at June 29, 2018 9.6 16.17 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 29, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 10: Commitments and Contingencies Leases The following represents future minimum lease obligations under non-cancelable operating leases as of June 29, 2018 (in millions): Remainder of 2018 $ 19.7 2019 35.0 2020 24.5 2021 19.9 2022 15.3 Thereafter 56.5 Total (1) $ 170.9 (1) Excludes $16.5 million of expected sublease income. Environmental Contingencies The Company’s headquarters in Phoenix, Arizona are located on property that is a “Superfund” site, which is a property listed on the National Priorities List and subject to clean-up activities under the Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”). Motorola and Freescale (acquired by NXP Semiconductors N.V.) have been involved in the cleanup of on-site solvent contaminated soil and groundwater and off-site contaminated groundwater pursuant to consent decrees with the State of Arizona. As part of the Company’s separation from Motorola in 1999, Motorola retained responsibility for this contamination, and Motorola and Freescale have agreed to indemnify the Company with respect to remediation costs and other costs or liabilities related to this matter. The Company’s former front-end manufacturing location in Aizu, Japan is located on property where soil and ground water contamination was detected. The Company believes that the contamination originally occurred during a time when the facility was operated by a prior owner. The Company worked with local authorities to implement a remediation plan and has completed remaining remediation. The majority of the cost of remediation was covered by insurance. Any costs to the Company in connection with this matter have not been, and, based on the information available, are not expected to be, material. The Company’s manufacturing facility in the Czech Republic has ongoing remediation projects to respond to releases of hazardous substances that occurred during the years that this facility was operated by government-owned entities. The remediation projects consist primarily of monitoring groundwater wells located on-site and off-site with additional action plans developed to respond in the event activity levels are exceeded. The government of the Czech Republic has agreed to indemnify the Company and its respective subsidiaries, subject to specified limitations, for remediation costs associated with this historical contamination. Any costs to the Company in connection with this matter have not been, and, based on the information available, are not expected to be, material. The Company’s design center in East Greenwich, Rhode Island is located on property that has localized soil contamination. In connection with the purchase of the facility, the Company entered into a Settlement Agreement and Covenant Not to Sue with the State of Rhode Island. This agreement requires that remedial actions be undertaken and a quarterly groundwater monitoring program be initiated by the former owners of the property. Any costs to the Company in connection with this matter have not been, and, based on the information available, are not expected to be, material. As a result of the acquisition of AMIS in 2008, the Company is a “primary responsible party” to an environmental remediation and cleanup at AMIS’s former corporate headquarters in Santa Clara, California. Costs incurred by AMIS include implementation of the clean-up plan, operations and maintenance of remediation systems, and other project management costs. However, AMIS’s former parent company, a subsidiary of Nippon Mining, contractually agreed to indemnify AMIS and the Company for any obligations relating to environmental remediation and cleanup at this location. Any costs to the Company in connection with this matter have not been, and, based on the information available, are not expected to be, material. Through its acquisition of Fairchild, the Company acquired a facility in South Portland, Maine. This facility has ongoing environmental remediation projects to respond to certain releases of hazardous substances that occurred prior to the leveraged recapitalization of Fairchild from its former parent company, National Semiconductor Corporation, which is now owned by Texas Instruments, Inc. Although the Company may incur certain liabilities with respect to these remediation projects, pursuant to the asset purchase agreement entered into in connection with the Fairchild recapitalization, National Semiconductor Corporation agreed to indemnify Fairchild, without limitation and for an indefinite period of time, for all future costs related to these projects. Under a 1999 asset purchase agreement pursuant to which Fairchild purchased the power device business of Samsung, Samsung agreed to indemnify Fairchild in an amount up to $150.0 million for remediation costs and other liabilities related to historical contamination at Samsung’s Bucheon, South Korea operations. Any costs to the Company in connection with this matter have not been, and, based on the information available, are not expected to be, material. Under a 2001 asset purchase agreement pursuant to which Fairchild purchased a manufacturing facility in Mountain Top, Pennsylvania, Intersil Corp. (acquired by Renesas Electronics Corporation) agreed to indemnify Fairchild for remediation costs and other liabilities related to historical contamination at the facility. Any costs to the Company incurred to respond to the above conditions and projects have not been, and are not expected to be, material, and any future payments the Company makes in connection with such liabilities are not expected to be material. The Company was notified by the Environmental Protection Agency (“EPA”) that it has been identified as a “potentially responsible party” (“PRP”) under CERCLA in the Chemetco Superfund matter. Chemetco, a defunct reclamation services supplier that operated in Illinois at what is now a Superfund site, has performed reclamation services for the Company in the past. The EPA is pursuing Chemetco customers for contribution to the site cleanup activities. The Company has joined a PRP group which is cooperating with the EPA in the evaluation and funding of the cleanup. Any costs to the Company in connection with this matter have not been, and, based on the information available, are not expected to be, material. Financing Contingencies In the ordinary course of business, the Company provides standby letters of credit or other guarantee instruments to certain parties initiated by either the Company or its subsidiaries, as required for transactions such as, but not limited to, material purchase commitments, agreements to mitigate collection risk, leases, utilities or customs guarantees. As of June 29, 2018 , the Revolving Credit Facility included $15.0 million of availability for the issuance of letters of credit. There were $0.1 million of letters of credit outstanding under the Revolving Credit Facility as of June 29, 2018 , which reduces the Company's borrowing capacity. The Company also had outstanding guarantees and letters of credit outside of its Revolving Credit Facility totaling $6.1 million as of June 29, 2018 . As part of obtaining financing in the ordinary course of business, the Company has issued guarantees related to certain of its subsidiaries' capital lease obligations, equipment financing, lines of credit and real estate mortgages, which totaled $104.4 million as of June 29, 2018 . Based on historical experience and information currently available, the Company believes that it will not be required to make payments under the standby letters of credit or guarantee arrangements for the foreseeable future. Indemnification Contingencies The Company is a party to a variety of agreements entered into in the ordinary course of business pursuant to which it may be obligated to indemnify the other parties for certain liabilities that arise out of or relate to the subject matter of the agreements. Some of the agreements entered into by the Company require it to indemnify the other party against losses due to IP infringement, property damage (including environmental contamination), personal injury, failure to comply with applicable laws, the Company’s negligence or willful misconduct or breach of representations and warranties and covenants related to such matters as title to sold assets. The Company faces risk of exposure to warranty and product liability claims in the event that its products fail to perform as expected or such failure of its products results, or is alleged to result, in economic damage, bodily injury or property damage. In addition, if any of the Company’s designed products are alleged to be defective, the Company may be required to participate in their recall. Depending on the significance of any particular customer and other relevant factors, the Company may agree to provide more favorable rights to such customer for valid defective product claims. The Company and its subsidiaries provide for indemnification of directors, officers and other persons in accordance with limited liability company operating agreements, certificates of incorporation, by-laws, articles of association or similar organizational documents, as the case may be. Section 145 of the Delaware General Corporation Law (“DGCL”) authorizes a court to award, or a corporation’s board of directors to grant, indemnity to directors and officers under certain circumstances and subject to certain limitations. The terms of Section 145 of the DGCL are sufficiently broad to permit indemnification under certain circumstances for liabilities, including reimbursement of expenses incurred, arising under the Exchange Act. As permitted by the DGCL, the Company’s Amended and Restated Certificate of Incorporation, as amended (the “Certificate of Incorporation”), contains provisions relating to the limitation of liability and indemnification of directors and officers. The Certificate of Incorporation eliminates the personal liability of each of the Company’s directors to the fullest extent permitted by Section 102(b)(7) of the DGCL, as it may be amended or supplemented, and provides that the Company will indemnify its directors and officers to the fullest extent permitted by Section 145 of the DGCL, as amended from time to time. The Company has entered into indemnification agreements with each of its directors and executive officers. The form of agreement (the “Indemnification Agreement”) provides, subject to certain exceptions and conditions specified in the Indemnification Agreement, that the Company will indemnify each indemnitee to the fullest extent permitted by Delaware law against all expenses, judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with a proceeding or claim in which such person is involved because of his or her status as one of the Company’s directors or executive officers. In addition, the Indemnification Agreement provides that the Company will, to the extent not prohibited by law and subject to certain exceptions and repayment conditions, advance specified indemnifiable expenses incurred by the indemnitee in connection with such proceeding or claim. The foregoing description of the Indemnification Agreement does not purport to be complete and is qualified in its entirety by reference to the full and complete terms of the Indemnification Agreement, which is filed as Exhibit 10.1 to the Current Report on Form 8-K filed by the Company on February 25, 2016 and is incorporated by reference herein. The Company also maintains directors’ and officers’ insurance policies that indemnify its directors and officers against various liabilities, including certain liabilities under the Exchange Act, that might be incurred by any director or officer in his or her capacity as such. The agreement and plan of merger relating to the acquisition of Fairchild (the "Fairchild Agreement") provides for indemnification and insurance rights in favor of Fairchild’s then current and former directors, officers and employees. Specifically, the Company has agreed that, for no fewer than six years following the Fairchild acquisition, the Company will: (a) indemnify and hold harmless each such indemnitee against losses and expenses (including advancement of attorneys’ fees and expenses) in connection with any proceeding asserted against the indemnified party in connection with such person’s servings as a director, officer, employee or other fiduciary of Fairchild or its subsidiaries prior to the effective time of the acquisition; (b) maintain in effect all provisions of the certificate of incorporation or bylaws of Fairchild or any of its subsidiaries or any other agreements of Fairchild or any of its subsidiaries with any indemnified party regarding elimination of liability, indemnification of officers, directors and employees and advancement of expenses in existence on the date of the Fairchild Agreement for acts or omissions occurring prior to the effective time of the acquisition; and (c) subject to certain qualifications, provide to Fairchild’s then current directors and officers an insurance and indemnification policy that provides coverage for events occurring prior to the effective time of the acquisition that is no less favorable than Fairchild’s then-existing policy, or, if insurance coverage that is no less favorable is unavailable, the best available coverage. While the Company’s future obligations under certain agreements may contain limitations on liability for indemnification, other agreements do not contain such limitations and under such agreements it is not possible to predict the maximum potential amount of future payments due to the conditional nature of the Company’s obligations and the unique facts and circumstances involved in each particular agreement. Historically, payments made by the Company under any of these indemnities have not had a material effect on the Company’s business, financial condition, results of operations or cash flows. Additionally, the Company does not believe that any amounts that it may be required to pay under these indemnities in the future will be material to the Company’s business, financial position, results of operations or cash flows. Legal Matters From time to time, the Company is party to various legal proceedings arising in the ordinary course of business, including indemnification claims, claims of alleged infringement of patents, trademarks, copyrights and other intellectual property rights, claims of alleged non-compliance with contract provisions and claims related to alleged violations of laws and regulations. The Company regularly evaluates the status of the legal proceedings in which it is involved to assess whether a loss is probable or there is a reasonable possibility that a loss, or an additional loss, may have been incurred and determine if accruals are appropriate. If accruals are not appropriate, the Company further evaluates each legal proceeding to assess whether an estimate of possible loss or range of possible loss can be made for disclosure. Although litigation is inherently unpredictable, the Company believes that it has adequate provisions for any probable and estimable losses. It is possible, nevertheless, that the Company’s consolidated financial position, results of operations or liquidity could be materially and adversely affected in any particular period by the resolution of a legal proceeding. The Company’s estimates do not represent its maximum exposure. Legal expenses related to defense, negotiations, settlements, rulings and advice of outside legal counsel are expensed as incurred. The Company is currently involved in a variety of legal matters that arise in the ordinary course of business. Based on information currently available, except as disclosed below, the Company is not involved in any pending or threatened legal proceedings that it believes could reasonably be expected to have a material adverse effect on its financial condition, results of operations or liquidity. The litigation process and the administrative process at the United States Patent and Trademark Office (the “USPTO”) are inherently uncertain, and the Company cannot guarantee that the outcome of these matters will be favorable to it. Patent Litigation with Power Integrations, Inc. There are eight outstanding civil litigation proceedings with Power Integrations, Inc. (“PI”), five of which were pending between PI and various Fairchild entities (including Fairchild Semiconductor International, Inc., Fairchild Semiconductor Corporation, and Fairchild (Taiwan) Corporation, f/k/a System General Corporation (collectively referred to in this sub-section as “Fairchild”)), prior to the acquisition of Fairchild. The Company is vigorously defending the lawsuits filed by PI and believes that it has strong defenses. There are also over two dozen outstanding administrative proceedings between the parties at the USPTO in which each party is challenging the validity of the other party's patents. The outcome of any litigation is inherently uncertain and difficult to predict. Any estimate or statement regarding any reserve or the estimated range of possible losses is made solely in compliance with applicable GAAP requirements and is not a statement or admission that the Company is or should be liable in any amount, or that any arguments, motions or appeals before any Court lack merit or are subject to impeachment. To the contrary, the Company believes that it has significant and meritorious grounds for judgment in its favor with respect to all of the PI cases and that the Company’s appeals or motions currently pending at the district court level will significantly reduce or eliminate all prior adverse jury verdicts. Subject to the foregoing, as of the date of the filing of this Form 10-Q, the Company estimates its range of possible losses for all PI cases to be between approximately $4.0 million and $20.0 million in the aggregate. Power Integrations v. Fairchild Semiconductor International, Inc. et al. (October 20, 2004, Delaware, 1:04-cv-01371-LPS): PI filed this lawsuit in 2004 in the U.S. District Court for the District of Delaware against Fairchild, alleging that certain of Fairchild’s pulse width modulation (“PWM”) integrated circuit products infringed U.S. patents owned by PI. The lawsuit sought a permanent injunction as well as money damages for Fairchild’s alleged infringement. In October 2006, a jury returned a willful infringement verdict and assessed damages against Fairchild. Fairchild voluntarily stopped U.S. sales and importation of those products in 2007 and has been offering replacement products since 2006. In December 2008, the judge overseeing the case reduced the jury’s 2006 damages award from $34.0 million to approximately $6.1 million and ordered a new trial on the issue of willfulness. Following the new trial held in June 2009, the court found Fairchild’s infringement to have been willful, and in January 2011 the court awarded PI final damages in the amount of $12.2 million . Fairchild appealed the final damages award, willfulness finding, and other issues to the U.S. Court of Appeals for the Federal Circuit. In March 2013, the Court of Appeals vacated substantially all of the damages award, ruling that there was no basis upon which a reasonable jury could find Fairchild liable for induced infringement. The Court of Appeals also vacated the earlier judgment of willful patent infringement. The full Court of Appeals and the Supreme Court of the United States later denied PI’s request to review the Court of Appeals ruling. The Court of Appeals instructed the lower court to conduct further proceedings to determine damages based on approximately $750,000 worth of sales and imports of affected products and to re-assess its finding that the infringement was willful. In December 2017, the lower court reinstated the willfulness finding but has since stayed resolution of the other outstanding issues, including damages. In June 2018, the Supreme Court of the United States decided WesternGeco LLC v. ION Geophysical Corp. , in which the Court determined that certain extraterritorial conduct may be relevant to some United States patent litigation. The lower court in this proceeding is in the process of determining whether WesternGeco has any impact on this case and the next steps in the litigation. Power Integrations v. Fairchild Semiconductor International, Inc. et al. (May 23, 2008, Delaware, 1:08-cv-00309-LPS): This lawsuit was initiated by PI in 2008 in the U.S. District Court for the District of Delaware against Fairchild, alleging that certain other PWM products infringed several U.S. patents owned by PI. On October 14, 2008, Fairchild filed a patent infringement lawsuit against PI in the U.S. District Court for the District of Delaware, alleging that certain PI products infringed U.S. patents owned by Fairchild. Each lawsuit included claims for money damages and a request for a permanent injunction. These two lawsuits were consolidated and heard together in a jury trial in April 2012 during which the jury found that PI infringed one of the two U.S. patents owned by Fairchild and upheld the validity of both of the Fairchild patents. In the same verdict, the jury found that Fairchild infringed two of four U.S. patents asserted by PI and that Fairchild had induced its customers to infringe the asserted patents. (The court later ruled that Fairchild infringed one other asserted PI patent that the jury found was not infringed.) The jury also upheld the validity of the asserted PI patents, and the court entered a permanent injunction against Fairchild. Willfulness and damages were not considered in the April 2012 trial but were reserved for subsequent proceedings. Fairchild and PI appealed the liability phase of this litigation to the U.S. Court of Appeals for the Federal Circuit, which heard arguments in July 2016 and issued a decision in December 2016. In the decision, the appeals court vacated the jury’s finding that Fairchild induced infringement of PI’s patents, held that one of PI’s patents was invalid, vacated the permanent injunction against Fairchild, reversed the jury’s finding that PI infringed the Fairchild patent and remanded the case back to the lower court for further proceedings consistent with these rulings. The Company is preparing for a trial, currently scheduled for the fourth quarter of 2018, at which willfulness, inducement and money damages are expected to be addressed. Power Integrations v. Fairchild Semiconductor International Inc. et al. (November 4, 2009, Northern District of California, 3:09-cv-05235-MMC): In 2009, PI sued Fairchild in the U.S. District Court for the Northern District of California, alleging that several of Fairchild’s products infringe three of PI’s patents. Fairchild filed counterclaims asserting that PI infringed two Fairchild patents. During the initial trial on this matter in 2014, a jury found that Fairchild willfully infringed two PI patents, awarded PI $105.0 million in damages and found that PI did not infringe any Fairchild patent. In September 2014, the court granted a motion filed by Fairchild that sought to set aside the jury’s determination that it acted willfully, and held that, as a matter of law, Fairchild’s actions were not willful. In November 2014, in response to another post-trial motion filed by Fairchild, the trial court ruled that the jury lacked sufficient evidence on which to base its damages award and, consequently, vacated the $105.0 million verdict and ordered a second trial on damages. The second damages trial was held in December 2015, in which a jury awarded PI $139.8 million in damages. Fairchild filed a number of post-trial motions challenging the second damages verdict, but the court ruled against Fairchild on these motions and awarded PI approximately $7.0 million in pre-judgment interest. Following the court’s rulings on these issues, PI moved the court to reinstate the jury’s willfulness finding and sought enhanced damages and attorneys’ fees. On January 23, 2017, the court reinstated the jury’s willful infringement finding but denied PI’s motion for enhanced damages and attorneys’ fees in its entirety. The Company appealed the infringement and damages judgments, and in July 2018, the U.S. Court of Appeals for the Federal Circuit affirmed the judgment with respect to infringement of both PI patents but vacated the damages judgment because PI had presented legally insufficient evidence to support its damages claim. The appellate court thus remanded the case back to the lower court for a new trial on damages. All claims of the two PI patents found to be infringed by Fairchild have since been determined to be unpatentable in several inter partes review administrative proceedings described below. The impact of the USPTO’s unpatentability determinations on the district court judgment is uncertain at this stage of the proceedings. Fairchild Semiconductor International Inc. et al. v. Power Integrations (May 1, 2012, Delaware, 1:12-cv-00540-LPS): In May 2012, Fairchild sued PI in the U.S. District Court for the District of Delaware and alleged that various PI products infringe Fairchild’s U.S. patents. PI filed counterclaims of patent infringement against Fairchild, asserting five PI patents. Of those five patents, the court granted Fairchild summary judgment of no infringement on one , and PI voluntarily withdrew a second and was forced to remove a third patent during the trial, which began in May 2015. In that trial, the jury found that PI induced infringement of Fairchild’s patent rights and awarded Fairchild $2.4 million in damages. The same jury found that Fairchild infringed a PI patent and awarded PI damages of $100,000 . Based on the December 2016 appellate court decision in the litigation filed in Delaware in 2008 (described above), on July 13, 2017, the District Court vacated the jury’s finding that PI infringed Fairchild’s patent. The court has tentatively scheduled a trial for November 2018 to resolve minor outstanding issues before final judgment can be entered. Power Integrations v. Fairchild Semiconductor International Inc. et al. (October 21, 2015, Northern District of California, 3:15-cv-04854 MMC): In 2015, PI filed another complaint for patent infringement against Fairchild in the U.S. District Court for the Northern District of California, alleging Fairchild's products willfully infringe two PI patents. In the complaint, PI is seeking a permanent injunction, unspecified damages, a trebling of damages, and an accounting of costs and fees. Fairchild answered and counterclaimed, alleging infringement by PI of four Fairchild patents related to aspects of PI’s products, and also seeking damages and a permanent injunction. The lawsuit is in its earliest stages, and has been stayed pending the outcome of the Company’s administrative challenges, which are described below, to the two PI patents asserted against Fairchild. PI has also filed administrative challenges to Fairchild’s asserted patents. Power Integrations v. ON Semiconductor Corporation, and Semiconductor Components Industries, LLC (November 1, 2016, Northern District of California, 5:16-cv-06371-BLF and 5:17-cv-03189): On August 11, 2016, ON Semiconductor Corporation and SCILLC (collectively referred to in this sub-section as “ON Semi”) filed a lawsuit against PI in the U.S. District Court for the District of Arizona, alleging that PI infringed six patents and seeking a permanent injunction and money damages for the alleged infringement. The lawsuit also sought a claim for a declaratory judgment that ON Semi does not infringe several of PI’s patents. Rather than responding to ON Semi’s lawsuit in Arizona, PI filed a separate lawsuit in the U.S. District Court for the Northern District of California in November 2016, alleging that ON Semi infringes six PI patents, including two of the three PI patents in ON Semi’s declaratory judgment claims from Arizona. PI also moved the Arizona court to dismiss ON Semi’s lawsuit, or in the alternative to transfer the lawsuit to California. Following various procedural motions, ON Semi’s Arizona action has been transferred to the U.S. District Court for the Northern District of California and consolidated with PI’s November 2016 lawsuit, in which PI has subsequently asserted a claim for infringement on the last of the three PI patents in ON Semi’s original declaratory judgment claims. The lawsuit is in its early stages, but the parties have begun to engage in discovery. ON Semiconductor Corporation and Semiconductor Components Industries, LLC v. Power Integrations, Inc. (March 9, 2017, District of Delaware, 1:17-cv-00247-LPS-CJB) : On March 9, 2017, ON Semi filed a lawsuit against PI in the U.S. District Court for the District of Delaware, alleging that PI’s InnoSwitch family of products infringe six of ON Semi’s U.S. patents. Following some procedural motions, PI has since counterclaimed alleging infringement by ON Semi of seven of PI’s U.S. Patents. Both parties seek money damages and a permanent injunction. The lawsuit is in its early stages, but the parties have begun to engage in discovery. Semiconductor Components Industries, LLC v. Power Integrations, Inc. (November 2017, Taiwan Intellectual Property Court, 106-Ming-min-bu-Tzu-238): In November 2017, Semiconductor Components Industries, LLC filed a lawsuit against PI in Taiwan alleging infringement by PI of certain of ON Semi’s Taiwanese patents. The lawsuit is in its early stages. Administrative Challenges to PI’s Patents In addition to the eight court proceedings described above, there are presently numerous inter partes review administrative proceedings between PI and ON Semi/Fairchild. Each of these administrative proceedings seeks to invalidate certain claims asserted in the various court proceedings. For the two proceedings filed by ON Semi involving claims asserted in the case filed in 2009 in the Northern District of California, the USPTO has issued a Final Written Decision finding that all of the claims challenged in those proceedings are unpatentable, and PI filed a notice of appeal for those decisions. The USPTO has also issued Final Written Decisions in seven additional proceedings in ON Semiconductor’s favor, and PI’s appeals in those cases are ongoing. In five of the proceedings initiated by PI, the USPTO has instituted a review of five ON Semi/Fairchild patents that are being asserted against PI, but the USPTO has not rendered a Final Written Decision in any of those five cases. All of the other proceedings remain pending or were terminated without substantive review by the USPTO. Litigation with Acbel Polytech, Inc. On November 27, 2013, Fairchild and Fairchild Semiconductor Corporation were named as defendants in a complaint filed by Acbel Polytech, Inc. (“Acbel”) in the U.S. District Court for the District of Massachusetts. The lawsuit alleged a number of causes of action, including breach of warranty, fraud, negligence and strict liability, and has been docketed as Acbel Polytech, Inc. v. Fairchild Semiconductor International, Inc. et al , Case # 1:13-CV-13046-DJC. On December 10, 2016, the Court issued an order on the Company’s motion for summary judgment dismissing all of Acbel’s claims except for claims alleging breach of implied warranties. A bench trial was held in June 2017. On December 27, 2017, the Court rendered a verdict in favor of the Fairchild defendants on the remaining implied warranty claims. On January 24, 2018, Acbel filed a notice of appeal. On February 7, 2018, Fairchild filed notice of a cross appeal. Acbel filed its appeal brief on April 9, 2018, and Fairchild filed its brief on May 29, 2018. Intellectual Property Matters The Company faces risk to exposure from claims of infringement of the IP rights of others. In the ordinary course of business, the Company receives letters asserting that the Company’s products or components breach another party’s rights. Such letters may request royalty payments from the Company, that the Company cease and desist using certain intellectual property or other remedies. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 29, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 11: Fair Value Measurements Fair Value of Financial Instruments The following table summarizes the Company's financial assets and liabilities, excluding pension assets, measured at fair value on a recurring basis (in millions): Fair Value Hierarchy Description As of June 29, 2018 Level 1 Level 2 Level 3 Assets: Cash and cash equivalents: Demand and time deposits $ 12.6 $ 12.6 $ — $ — Money market funds 0.3 0.3 — — During the quarter ended March 30, 2018, the Company reduced the contingent consideration payable relating to the second earn-out for the AXSEM acquisition to zero due to a revision in the Company's expectations regarding the likelihood that the earn-out would be achieved. The gain was recorded in other expense in the Consolidated Statements of Operations and Comprehensive Income. Fair Value Hierarchy Description As of December 31, 2017 Level 1 Level 2 Level 3 Assets: Cash and cash equivalents: Demand and time deposits $ 71.7 $ 71.7 $ — $ — Money market funds 0.2 0.2 — — Liabilities: Contingent consideration $ 2.3 $ — $ — $ 2.3 Other The carrying amounts of other current assets and liabilities, such as accounts receivable and accounts payable, approximate fair value based on the short-term nature of these instruments. Fair Value of Long-Term Debt, Including Current Portion The carrying amounts and fair values of the Company’s long-term borrowings (excluding capital lease obligations, real estate mortgages and equipment financing) are as follows (in millions): As of June 29, 2018 December 31, 2017 Carrying Amount Fair Value Carrying Amount Fair Value Long-term debt, including current portion Convertible notes $ 1,099.8 $ 1,641.3 $ 1,080.1 $ 1,596.7 Long-term debt $ 1,633.8 $ 1,636.4 $ 1,833.2 $ 1,845.4 The fair values of the Company's 1.00% Notes and 1.625% Notes were estimated based on market prices in active markets (Level 1). The fair value of other long-term debt was estimated based on discounting the remaining principal and interest payments using current market rates for similar debt (Level 2) at June 29, 2018 and December 31, 2017 . Cost and Equity Method Investments The Company accounts for investments in companies that it does not control, or have significant influence over, under the cost method, as applicable. If a decline in the fair value of a cost method investment is determined to be other than temporary, an impairment charge is recorded, and the carrying value of the cost method investment is reduced to fair value. The Company evaluates all of its cost method investments for impairment; however, it is not required to determine the fair value of its investment unless impairment indicators are present. The Company’s cost method investments had a carrying value of $7.4 million and $12.6 million as of June 29, 2018 and December 31, 2017 , respectively. On April 1, 2018 (the "second closing date”), the Company entered into an agreement to acquire a 30 percent incremental interest in AFSM for $19.8 million in cash, resulting in a 40 percent ownership interest with an aggregate investment value of $26.2 million . The Company’s investment in AFSM, which was accounted for under the cost method through the quarter ended March 30, 2018, has been accounted for under the equity method beginning April 1, 2018 following the increase in the Company's investment. Subject to the fulfillment of certain conditions, the Company will be required to increase its ownership interest to 60 percent between one and six months following the second closing date (the “third closing date”) and will be required to increase its ownership interest to 100 percent between nine and 18 months following the third closing date. AFSM, a related party beginning in the quarter ended June 29, 2018, operates a front-end fabrication facility in Aizu-Wakamatsu that manufactures 8-inch wafers based on design specification from its customers, which are primarily the Company and another investor. During the quarter ended June 29, 2018, the Company purchased inventory of approximately $7.3 million and has a payable of $1.6 million to AFSM as of June 29, 2018. |
Financial Instruments
Financial Instruments | 6 Months Ended |
Jun. 29, 2018 | |
Investments, All Other Investments [Abstract] | |
Financial Instruments | Note 12: Financial Instruments Foreign Currencies As a multinational business, the Company’s transactions are denominated in a variety of currencies. When appropriate, the Company uses forward foreign currency contracts to reduce its overall exposure to the effects of currency fluctuations on its results of operations and cash flows. The Company’s policy prohibits trading in currencies for which there are no underlying exposures and entering into trades for any currency to intentionally increase the underlying exposure. The Company primarily hedges existing assets and liabilities associated with transactions currently on its balance sheet, which are undesignated hedges for accounting purposes. As of June 29, 2018 and December 31, 2017 , the Company had net outstanding foreign exchange contracts with notional amounts of $86.4 million and $ 130.5 million , respectively. Such contracts were obtained through financial institutions and were scheduled to mature within one to three months from the time of purchase. Management believes that these financial instruments should not subject the Company to increased risks from foreign exchange movements because gains and losses on these contracts should offset losses and gains on the underlying assets, liabilities and transactions to which they are related. The following summarizes the Company’s net foreign exchange positions in U.S. dollars (in millions): As of June 29, 2018 December 31, 2017 Buy (Sell) Notional Amount Buy (Sell) Notional Amount Euro $ (4.9 ) $ 4.9 $ (22.9 ) $ 22.9 Japanese Yen — — (40.0 ) 40.0 Philippine Peso 30.6 30.6 26.4 26.4 Chinese Yuan 13.0 13.0 5.3 5.3 Czech Koruna 10.3 10.3 7.6 7.6 Other Currencies - Buy 19.6 19.6 18.0 18.0 Other Currencies - Sell (8.0 ) 8.0 (10.3 ) 10.3 $ 60.6 $ 86.4 $ (15.9 ) $ 130.5 Amounts receivable or payable under the contracts are included in other current assets or accrued expenses in the accompanying Consolidated Balance Sheets. For the quarters ended June 29, 2018 and June 30, 2017 , realized and unrealized foreign currency transactions totaled a $2.2 million loss and a $0.1 million gain, respectively. For the six months ended June 29, 2018 and June 30, 2017 , realized and unrealized foreign currency transactions totaled a $6.6 million loss and a $2.8 million loss, respectively. The realized and unrealized foreign currency transactions are included in other income and expenses in the Company's Consolidated Statements of Operations and Comprehensive Income. Cash Flow Hedges All derivatives are recognized on the balance sheet at their fair value and classified based on the instrument's maturity date. Interest rate risk The Company uses interest rate swap contracts to mitigate its exposure to interest rate fluctuations associated with the Term Loan "B" Facility. The Company does not use such swap contracts for speculative or trading purposes. These contracts effectively hedge some of the future variable rate LIBOR interest expense to a fixed rate interest expense. The derivative instruments qualified for accounting as a cash flow hedge in accordance with ASC 815, and the Company designated it as such. The Company performed effectiveness assessments and concluded that there is no ineffectiveness during the quarters ended June 29, 2018 and June 30, 2017 . Foreign currency risk The purpose of the Company's foreign currency hedging activities is to protect the Company from the risk that the eventual cash flows resulting from transactions in foreign currencies will be adversely affected by changes in exchange rates. The Company enters into forward contracts that are designated as foreign currency cash flow hedges of selected forecasted payments denominated in currencies other than U.S. dollars. For the quarters and six months ended June 29, 2018 and June 30, 2017 , the Company did not have outstanding derivatives for its foreign currency exposure designated as cash flow hedges. Convertible Note Hedges The Company entered into convertible note hedges in connection with the issuance of the 1.00% Notes and 1.625% Notes. Other At June 29, 2018 , the Company had no outstanding commodity derivatives, currency swaps or options relating to either its debt instruments or investments. The Company does not hedge the value of its equity investments in its subsidiaries or affiliated companies. The Company is exposed to credit-related losses if counterparties to hedge contracts fail to perform their obligations. As of June 29, 2018 , the counterparties to the Company’s hedge contracts are held at financial institutions which the Company believes to be highly rated, and no credit-related losses are anticipated. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 29, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 13: Income Taxes The Company has historically determined its interim income tax provision by applying the estimated effective income tax rate expected to be applicable for the full fiscal year to the income before income taxes for the period. In determining the full year estimate, the Company does not include the estimated impact of unusual and/or infrequent items, which may cause significant variations in the customary relationship between income tax expense and income before income taxes. Significant judgment is exercised in determining the income tax provision due to transactions, credits and calculations where the ultimate tax determination is uncertain. The Company’s effective tax rate for the quarter ended June 29, 2018 , was 19.2% , which differs from the U.S. federal income tax rate of 21.0% principally due to discrete benefits of $8.9 million relating to the release of reserves and interest for uncertain tax positions in the U.S. and foreign taxing jurisdictions related to prior years and $2.8 million relating to the release of a valuation allowance against deferred tax assets expected to be realized in the foreseeable future. These benefits are partially offset by foreign taxes for which the Company will not receive a U.S. tax credit as a result of U.S. tax reform and the Company’s U.S. federal net operating loss carryforwards. The Company’s effective tax rate for the six months ended June 29, 2018 was 15.3% , which differs from the U.S. federal income tax rate of 21.0% principally due to discrete benefits of $8.9 million relating to the release of reserves and interest for uncertain tax positions in the U.S. and foreign taxing jurisdictions related to prior years, $19.9 million relating to an increase in deferred tax assets and release of valuation allowance against deferred tax assets expected to be realized in the foreseeable future and $7.1 million relating to equity award excess tax benefits. These benefits are partially offset by foreign taxes for which the Company will not receive a U.S. tax credit as a result of U.S. tax reform and the Company’s U.S. federal net operating loss carryforwards. In December 2017 the SEC staff issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (“SAB 118”), which allows the Company to record provisional amounts during a measurement period not to extend beyond one year of the enactment date. As of June 29, 2018 , the Company has not completed its accounting for the tax effects of the enactment of the Tax Act; however, in certain cases, specifically as follows, the Company made a reasonable estimate of (i) the effects on its existing deferred tax balances and (ii) the effects of the one-time mandatory repatriation tax. The Company recognized a provisional tax benefit of $449.9 million in the year ended December 31, 2017, associated with the items it could reasonably estimate. For the quarter and six months ended June 29, 2018 , there have not been any adjustments made to these estimates. The Company is still analyzing the Tax Act and refining its calculations, which could potentially impact the measurement of its tax balances. The Company expects to complete its analysis within the measurement period in accordance with SAB 118. At June 29, 2018 , the Company was not able to reasonably estimate, and therefore has not recorded, deferred taxes for the Global Intangible Low-Taxed Income (“GILTI”) provisions of the Tax Act. The Company has not yet determined its policy election with respect to whether to record deferred taxes for basis differences expected to reverse as a result of the GILTI provisions in future periods or use the period cost method. The Company has, however, included an estimate of the current impact of GILTI in its tax provision for 2018. The Company recognizes interest and penalties related to unrecognized tax benefits in tax expense on the Company's Consolidated Statements of Operations and Comprehensive Income. The Company had approximately $4.0 million and $5.0 million of net interest and penalties accrued at June 29, 2018 and June 30, 2017 , respectively. Although the Company cannot predict the timing of resolution with taxing authorities, if any, it believes it is reasonably possible that $7.5 million of its unrecognized tax benefits will be reduced in the next 12 months due to settlement with tax authorities or expiration of the applicable statute of limitations. Tax years 2013 and prior are generally not subject to examination by the Internal Revenue Services (the “IRS”) except for items involving tax attributes that have been carried forward to tax years whose statute of limitations remains open. The Company is not currently under IRS examination. For state tax returns, the Company is generally not subject to income tax examinations for years 2012 and prior. The Company is also subject to routine examinations by various foreign tax jurisdictions in which it operates. With respect to major jurisdictions outside the United States, the Company's subsidiaries are no longer subject to income tax audits for years prior to 2007. The Company is currently under audit in the following significant jurisdictions: China, the Czech Republic, Malaysia, Mauritius, Singapore and Vietnam. |
Changes in Accumulated Other Co
Changes in Accumulated Other Comprehensive Loss | 6 Months Ended |
Jun. 29, 2018 | |
Equity [Abstract] | |
Changes in Accumulated Other Comprehensive Loss | Note 14: Changes in Accumulated Other Comprehensive Loss Amounts comprising the Company's accumulated other comprehensive loss and reclassifications are as follows (in millions): Currency Translation Adjustments Effects of Cash Flow Hedges Total Balance as of December 31, 2017 $ (43.2 ) $ 2.6 $ (40.6 ) Other comprehensive income prior to reclassifications 0.9 4.0 4.9 Amounts reclassified from accumulated other comprehensive loss — 0.8 0.8 Net current period other comprehensive income (1) 0.9 4.8 5.7 Balance as of June 29, 2018 $ (42.3 ) $ 7.4 $ (34.9 ) (1) Effects of cash flow hedges are net of $1.3 million of tax expense for the six months ended June 29, 2018 . Amounts which were reclassified from accumulated other comprehensive loss to the Company's Consolidated Statements of Operations and Comprehensive Income (net of tax of $0.2 million and zero for the quarters and six months ended June 29, 2018 , and June 30, 2017 , respectively, in millions): Amounts Reclassified from Accumulated Other Comprehensive Loss Quarters Ended Six Months Ended June 29, 2018 June 30, 2017 June 29, 2018 June 30, 2017 Statements of Operations and Comprehensive Income Line Item Interest rate swaps $ (0.7 ) $ — $ (0.8 ) $ 0.2 Other income and expense Total reclassifications $ (0.7 ) $ — $ (0.8 ) $ 0.2 |
Supplemental Disclosures
Supplemental Disclosures | 6 Months Ended |
Jun. 29, 2018 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Disclosures | Note 15: Supplemental Disclosures Supplemental Disclosure of Cash Flow Information The Company's non-cash activities and cash payments for interest and income taxes are as follows (in millions): Six Months Ended June 29, 2018 June 30, 2017 Non-cash activities: Capital expenditures in accounts payable and other liabilities $ 199.5 $ 196.4 Cash (received) paid for: Interest income $ (2.0 ) $ (1.1 ) Interest expense $ 41.0 $ 49.0 Income taxes $ 32.4 $ 35.5 The Company adopted ASU 2016-18 on a retrospective basis during the quarter ended March 30, 2018. The following is a reconciliation of the captions in the Consolidated Balance Sheets to the Consolidated Statements of Cash Flows (in millions): As of June 29, 2018 December 31, 2017 June 30, 2017 December 31, 2016 Consolidated Balance Sheets: Cash and cash equivalents $ 850.2 $ 949.2 $ 871.6 $ 1,028.1 Restricted cash (included in other current assets) 17.5 17.4 17.4 17.7 Cash, cash equivalents and restricted cash in Consolidated Statements of Cash Flows $ 867.7 $ 966.6 $ 889.0 $ 1,045.8 The restricted cash balance relates to the consideration held in escrow for the Aptina acquisition to be released upon satisfaction of certain outstanding items contained in the merger agreement. |
Background and Basis of Prese21
Background and Basis of Presentation (Policies) | 6 Months Ended |
Jun. 29, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Adoption of New Revenue Standard and Change in Accounting Policy | Adoption of New Revenue Standard On January 1, 2018, as required, the Company adopted ASU No. 2014-09 - Revenue from Contracts with Customers (Topic 606) ("ASU 2014-09"), ASU No. 2015-14 - Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date ("ASU 2015-14"), ASU No. 2016-08 - Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations ("ASU 2016-08"), ASU No. 2016-10 - Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing ("ASU 2016-10"), ASU No. 2016-12 - Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients ("ASU 2016-12") and ASU No. 2016-20 - Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers” ("ASU 2016-20") (collectively “the New Revenue Standard”). To conform to the New Revenue Standard, the Company modified its revenue recognition policy as described below. Change in Accounting Policy On January 1, 2018, the Company adopted the New Revenue Standard using the modified retrospective method, applying the guidance to all open contracts and recognized the cumulative effect adjustment of $2.1 million to retained earnings and accrued expenses as of that date. The comparative financial information has not been restated and continues to be presented under the accounting standards in effect for the respective periods. The Company applied the practical expedient and has not disclosed the revenues allocated to future shipments of partially completed contracts. Substantially all of the Company’s revenues continue to be recognized following the transfer of control of the products to the customer, which typically occurs upon shipment or delivery depending on the terms of the underlying contracts. Under the New Revenue Standard, revenues from certain product development agreements, which were previously deferred as delivered, are now recognized over time. ASUs Adopted: New Revenue Standard The Company adopted the New Revenue Standard on a modified retrospective basis on January 1, 2018. The cumulative-effect adjustment related to the timing of revenue recognition on certain product development agreements recorded to beginning retained earnings as of January 1, 2018, was $2.1 million . The Company expects the ongoing impact of the New Revenue Standard to be immaterial to the consolidated financial statements. ASU No. 2017-09 - Scope of Modification Accounting ("ASU 2017-09") In May 2017, the FASB issued ASU No. 2017-09 to reduce diversity in practice and provide clarity regarding existing guidance in ASC 718, “Stock Compensation.” The amendments clarify that an entity should apply modification accounting in response to a change in the terms and conditions of an entity’s share-based payment awards unless three newly specified criteria are met. The amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company adopted ASU 2017-09 during the first quarter of 2018. The adoption of this standard did not have a material impact on the consolidated financial statements. ASU No 2017-07 - Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost ("ASU 2017-07") In March 2017, the FASB issued ASU 2017-07 primarily to improve the presentation of net periodic pension cost and net periodic postretirement benefit cost. The guidance will require the net benefit cost to be split in the income statement. The service cost component will be included in operating income. The other components, including amortization of past service costs or credits and settlement and curtailments amounts, will be reported separately outside of operating income. The amendment is effective for fiscal years beginning after December 15, 2017. The Company adopted ASU 2017-07 during the first quarter of 2018, applying the standard retrospectively to all periods presented. The adoption of this standard did not have a material impact on the current period or prior period consolidated financial statements. See Note 6: ''Balance Sheet Information'' for further information on the adoption of ASU 2017-07. ASU No. 2016-18 - Statement of Cash Flows (Topic 230): Restricted Cash (a consensus of the FASB Emerging Issues Task Force) ("ASU 2016-18") In November 2016, the FASB issued ASU 2016-18, which requires entities to include in their cash and cash-equivalent balances in the statement of cash flows those amounts that are deemed to be restricted cash and restricted cash equivalents. The ASU does not define the terms “restricted cash” and “restricted cash equivalents.” The amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company adopted ASU 2016-18 during the first quarter of 2018, applying the standard retrospectively to all periods presented. The adoption of this standard did not have a material impact on the current period or prior period consolidated financial statements. See Note 15: ''Supplemental Disclosures'' for further information on the adoption of ASU 2016-18. ASU No. 2016-16 - Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory ("ASU 2016-16") In October 2016, the FASB issued ASU 2016-16, which eliminates the exception for all intra-entity sales of assets other than inventory. As a result, a reporting entity would recognize the tax expense from the sale of the asset in the seller’s tax jurisdiction when the transfer occurs, even though the pre-tax effects of that transaction are eliminated in consolidation. Any deferred tax asset that arises in the buyer’s jurisdiction would also be recognized at the time of the transfer. The new guidance does not apply to intra-entity transfers of inventory. The income tax consequences from the sale of inventory from one member of a consolidated entity to another will continue to be deferred until the inventory is sold to a third party. The amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company adopted ASU 2016-16 during the first quarter of 2018. The adoption of this standard did not have a material impact on the consolidated financial statements. ASU No. 2016-15 - Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments ("ASU 2016-15") In August 2016, the FASB issued ASU 2016-15, which changes how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company adopted ASU 2016-15 during the first quarter of 2018. The adoption of this standard did not have a material impact on the consolidated financial statements. ASUs Pending Adoption: ASU No. 2017-12 - Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities ("ASU 2017-12") In August 2017, the FASB issued ASU No. 2017-12 to better align hedge accounting with risk management strategies, and as a result, more hedging strategies will be eligible for hedge accounting. Public business entities will have until the end of the first quarter in which a hedge is designated to perform an initial assessment of a hedge’s effectiveness. After initial qualification, the new guidance permits a qualitative effectiveness assessment for certain hedges instead of a quantitative test if the company can reasonably support an expectation of high effectiveness throughout the term of the hedge. An initial quantitative test to establish that the hedge relationship is highly effective is still required. The amendments are effective for fiscal years beginning after December 15, 2018. Early adoption is permitted. The Company does not anticipate the adoption of ASU 2017-12 will have a material impact on its consolidated financial statements. ASU No. 2016-02 - Leases (Topic 842) ("ASU 2016-02") In February 2016, the FASB issued ASU 2016-02, which amends the accounting treatment for leases. Lessees (for capital and operating leases) and lessors (for sales-type leases, direct financing leases and operating leases) must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. Lessees and lessors may not apply a full retrospective transition approach. The amendments are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. The Company expects the adoption of this standard will result in a significant component of the Company's future minimum lease obligations as disclosed in Note 10: ''Commitments and Contingencies'' to be included on its Consolidated Balance Sheets. The Company is currently reviewing its service agreements and other arrangements to evaluate whether they meet the definition of a lease under ASU 2016-02 and what additional impact that the adoption of ASU 2016-02 may have on its consolidated financial statements. |
Revenue Recognition Policy | Revenue Recognition Policy In anticipation of the adoption of the New Revenue Standard, during the quarter ended March 31, 2017, the Company developed its internal systems, processes and controls to enable it to make the estimates required by the New Revenue Standard on sales to its distributors and was able to reliably estimate upfront the effects of returns and allowances and record revenues at the time of shipments to these distributors. Prior to this, the Company recognized revenues from distributors under the sell-through method as it did not have the ability to estimate the effects of returns and allowances. As a result of this change, the Company recognized an additional $155.1 million in revenues during the first quarter of 2017, which resulted in an increase of $59.0 million to income before income taxes. The Company generates revenue from sales of its semiconductor products to OEMs, electronic manufacturing service providers and distributors. The Company also generates revenue, to a much lesser extent, from product development agreements and manufacturing services provided to customers. The Company recognizes revenue when it satisfies a performance obligation in an amount reflecting the consideration to which it expects to be entitled. For sales agreements, the Company has identified the promise to transfer products, each of which is distinct, to be the performance obligation. For product development agreements, the Company has identified the completion of a service defined in the agreement to be the performance obligation. The Company applies a five-step approach in determining the amount and timing of revenue to be recognized: (1) identifying the contract with a customer; (2) identifying the performance obligations in the contract; (3) determining the transaction price; (4) allocating the transaction price to the performance obligations in the contract; and (5) recognizing revenue when the performance obligation is satisfied. Substantially all of the Company’s revenue is recognized at the time control of the products transfers to the customer. Sales agreements with customers are renewable periodically and contain terms and conditions with respect to payment, delivery, warranty and supply, but typically do not require minimum purchase commitments. In the absence of a sales agreement, the Company’s standard terms and conditions apply. The Company considers the customer purchase orders, governed by sales agreements or the Company’s standard terms and conditions, to be the contract with the customer. The Company evaluates certain factors including the customer’s ability to pay (or credit risk). Most of the Company’s OEM customers negotiate pricing terms on an annual basis, while the electronic manufacturer service providers and distributors generally negotiate pricing terms on a quarterly basis. Pricing terms on product development agreements are negotiated at the beginning of a project. The Company allocates the transaction price to each distinct product based on its relative stand-alone selling price. In determining the transaction price, the Company evaluates whether the price is subject to refund or adjustment to determine the net consideration to which the Company expects to be entitled. The Company’s OEM customers do not have the right to return products, other than pursuant to the provisions of the Company’s standard warranty. Sales to distributors, however, are typically made pursuant to agreements that provide return rights with respect to discontinued or slow-moving products, referred to as stock rotation. Sales to distributors can also be subject to price adjustment on certain products, primarily for distributors with ship and credit rights. Although payment terms vary, most distributor agreements require payment within 30 days . In addition, the Company offers cash discounts to certain customers for payments received within an agreed upon time, generally 10 days after shipment. The Company recognizes revenue when it satisfies a performance obligation. The Company recognizes revenue from sales agreements upon transferring control of a product to the customer. This typically occurs when products are shipped or delivered, depending on the delivery terms, or when products that are consigned at customer locations are consumed. The Company recognizes revenue from product development agreements over time based on the cost-to-cost method. Revenues recognized during the quarter and six months ended June 29, 2018 , for sales agreements was $1,447.9 million and $2,820.7 million , respectively, and for product development agreements was $8.0 million and $12.8 million , respectively. Sales returns and allowances are estimated based on historical experience. Provisions for discounts and rebates to customers, estimated returns and allowances, ship and credit claims and other adjustments are provided for in the same period the related revenues are recognized, and are netted against revenues. For returns, the Company recognizes a related asset for the right to recover returned products with a corresponding reduction to cost of goods sold. The Company reviews warranty and related claims activity and records provisions, as necessary. The Company records a reserve for cash discounts as a reduction to accounts receivable and a reduction to revenues, based on the experience with each customer. Frequently, the Company receives orders with multiple delivery dates that may extend across reporting periods. Since each delivery constitutes a performance obligation, the Company allocates the transaction price of the contract to each performance obligation based on the stand-alone selling price of the products. The Company invoices the customer for each delivery upon shipment and recognizes revenue in accordance with delivery terms. As scheduled delivery dates are within one year, revenue allocated to future shipments of partially completed contracts are not disclosed. The Company has elected to record freight and handling costs associated with outbound freight after control over a product has transferred to a customer as a fulfillment cost and include it in cost of revenues. Taxes assessed by government authorities on revenue-producing transactions, including value-added and excise taxes, are presented on a net basis (excluded from revenues) in the Consolidated Statements of Operations and Comprehensive Income. The Company generally warrants that products sold to its customers will, at the time of shipment, be free from defects in workmanship and materials and conform to specifications. The Company’s standard warranty extends for a period of two years from the date of delivery, except in the case of image sensor products, which are warrantied for one year from the date of delivery. At the time revenue is recognized, the Company establishes an accrual for estimated warranty expenses associated with its sales and records them as a component of the cost of revenues |
Use of Estimates | Use of Estimates The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Management evaluates these estimates and judgments on an ongoing basis and bases its estimates on experience, current and expected future conditions, third-party evaluations and various other assumptions that management believes are reasonable under the circumstances. Significant estimates have been used by management in conjunction with the following: (i) estimates of future payouts for customer incentives and estimates of amounts subject to allowances, returns and warranties; (ii) measurement of valuation allowances relating to inventories and trade receivables; (iii) future cash flows used to assess and test for impairment of goodwill and indefinite-lived intangible assets and long-lived assets, if applicable; (iv) assumptions surrounding future pension obligations; (v) fair values of share-based compensation and of financial instruments (including derivative financial instruments); (vi) measurement of valuation allowances against deferred tax assets, evaluations of uncertain tax positions and the impact of U.S. tax reform; and (vii) estimates and assumptions used in connection with business combinations. Actual results may differ from the estimates and assumptions used in the consolidated financial statements and related notes. |
Foreign Currencies | Foreign Currencies Most of the Company’s foreign subsidiaries conduct business primarily in U.S. dollars and, as a result, utilize the dollar as their functional currency. For the remeasurement of financial statements of these subsidiaries, assets and liabilities in foreign currencies that are receivable or payable in cash are remeasured at current exchange rates, while inventories and other non-monetary assets in foreign currencies are remeasured at historical rates. Gains and losses resulting from the remeasurement of such financial statements are included in the operating results, as are gains and losses incurred on foreign currency transactions. Historically, the majority of the Company’s Japanese subsidiaries utilized Japanese Yen as their functional currency. The assets and liabilities of these subsidiaries are translated at current exchange rates, while revenues and expenses are translated at the average rates in effect for the period. The related translation gains and losses are included in other comprehensive income or loss within the Consolidated Statements of Operations and Comprehensive Income. As a result of an analysis which took into account the economic indicators of these subsidiaries from a long-term perspective, the Company changed the functional currency for some of these subsidiaries from Japanese Yen to U.S. dollars effective as of January 1, 2018. |
Cost Method Investments | Cost and Equity Method Investments The Company accounts for investments in companies that it does not control, or have significant influence over, under the cost method, as applicable. If a decline in the fair value of a cost method investment is determined to be other than temporary, an impairment charge is recorded, and the carrying value of the cost method investment is reduced to fair value. The Company evaluates all of its cost method investments for impairment; however, it is not required to determine the fair value of its investment unless impairment indicators are present. |
Revenue and Segment Informati22
Revenue and Segment Information (Tables) | 6 Months Ended |
Jun. 29, 2018 | |
Segment Reporting [Abstract] | |
Revenues and Gross Profit From Reportable Segments | Revenues and gross profit for the Company’s operating and reporting segments were as follows (in millions): Power Solutions Group Analog Solutions Group Intelligent Sensing Group Total For the quarter ended June 29, 2018: Revenues from external customers $ 748.2 $ 513.2 $ 194.5 $ 1,455.9 Gross profit $ 267.1 $ 219.3 $ 82.6 $ 569.0 For the quarter ended June 30, 2017: Revenues from external customers $ 671.4 $ 468.5 $ 198.1 $ 1,338.0 Gross profit $ 228.5 $ 195.8 $ 74.9 $ 499.2 For the six months ended June 29, 2018: Revenues from external customers $ 1,440.8 $ 1,009.4 $ 383.3 $ 2,833.5 Gross profit $ 506.3 $ 426.1 $ 164.3 $ 1,096.7 For the six months ended June 30, 2017: Revenues from external customers $ 1,415.2 $ 972.1 $ 387.4 $ 2,774.7 Gross profit $ 472.5 $ 405.1 $ 142.3 $ 1,019.9 |
Reconciliation of Operating Profit (Loss) from Segments to Consolidated | Reconciliations of segment gross profit to consolidated gross profit are as follows (in millions): Quarters Ended Six Months Ended June 29, 2018 June 30, 2017 June 29, 2018 June 30, 2017 Gross profit for reporting segments $ 569.0 $ 499.2 $ 1,096.7 $ 1,019.9 Less: unallocated manufacturing costs (14.0 ) (7.2 ) (24.3 ) (24.8 ) Consolidated gross profit $ 555.0 $ 492.0 $ 1,072.4 $ 995.1 |
Disaggregation of Revenue | Revenues for the Company's operating and reporting segments disaggregated into geographic locations and sales channels were as follows (in millions): Quarter Ended June 29, 2018 Power Solutions Group Analog Solutions Group Intelligent Sensing Group Total Geographic Location United States $ 98.2 $ 85.9 $ 33.4 $ 217.5 United Kingdom 124.5 82.4 35.5 242.4 Hong Kong 229.4 133.1 42.4 404.9 Singapore 244.1 157.8 31.9 433.8 Other 52.0 54.0 51.3 157.3 Total $ 748.2 $ 513.2 $ 194.5 $ 1,455.9 Sales Channel OEM $ 219.8 $ 220.0 $ 69.0 $ 508.8 Distributors 482.0 257.5 115.3 854.8 Electronic Manufacturing Service Providers 46.4 35.7 10.2 92.3 Total $ 748.2 $ 513.2 $ 194.5 $ 1,455.9 Six Months Ended June 29, 2018 Power Solutions Group Analog Solutions Group Intelligent Sensing Group Total Geographic Location United States $ 192.7 $ 164.1 $ 59.9 $ 416.7 United Kingdom 243.1 161.5 71.4 476.0 Hong Kong 434.6 255.6 75.6 765.8 Singapore 472.5 319.0 75.2 866.7 Other 97.9 109.2 101.2 308.3 Total $ 1,440.8 $ 1,009.4 $ 383.3 $ 2,833.5 Sales Channel OEM $ 417.9 $ 427.6 $ 133.5 $ 979.0 Distributors 934.6 511.6 230.2 1,676.4 Electronic Manufacturing Service Providers 88.3 70.2 19.6 178.1 Total $ 1,440.8 $ 1,009.4 $ 383.3 $ 2,833.5 |
Summary of Property, Plant and Equipment by Geographic Location | Property, plant and equipment, net by geographic location, is summarized as follows (in millions): As of June 29, 2018 December 31, 2017 United States $ 572.9 $ 547.9 Korea 396.9 380.5 Malaysia 225.0 230.0 Philippines 464.7 439.5 China 254.9 246.0 Other 472.8 435.2 Total $ 2,387.2 $ 2,279.1 |
Acquisitions, Divestitures an23
Acquisitions, Divestitures and Licensing Transactions Acquisitions, Divestitures and Licensing Transactions (Tables) | 6 Months Ended |
Jun. 29, 2018 | |
Business Combinations [Abstract] | |
Schedule of Purchase Price Allocation | The following table presents the provisional allocation of the purchase price of SensL for the assets acquired and liabilities assumed based on their fair values (in millions): Initial Estimate Current assets (including cash and cash equivalents of $0.7 million) $ 4.2 Property, plant and equipment and other non-current assets 1.8 Goodwill 15.2 Intangible assets (excluding IPRD) 30.4 IPRD 25.0 Total assets acquired 76.6 Current liabilities 0.7 Other non-current liabilities 4.5 Total liabilities assumed 5.2 Net assets acquired/purchase price $ 71.4 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 6 Months Ended |
Jun. 29, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Goodwill by Reportable Segment | The following table summarizes goodwill by operating and reporting segments (in millions): As of June 29, 2018 December 31, 2017 Goodwill Accumulated Impairment Losses Carrying Value Goodwill Accumulated Impairment Losses Carrying Value Operating and Reporting Segments: Power Solutions Group $ 432.2 $ (31.9 ) $ 400.3 $ 432.2 $ (28.6 ) $ 403.6 Analog Solutions Group 836.7 (418.9 ) 417.8 836.7 (418.9 ) 417.8 Intelligent Sensing Group 110.7 — 110.7 95.5 — 95.5 $ 1,379.6 $ (450.8 ) $ 928.8 $ 1,364.4 $ (447.5 ) $ 916.9 The following table summarizes the change in goodwill from December 31, 2017 to June 29, 2018 (in millions): Net balance as of December 31, 2017 $ 916.9 Addition due to business combination 15.2 Goodwill impairment (3.3 ) Net balance as of June 29, 2018 $ 928.8 |
Summary of Intangible Assets, Net | Intangible assets, net, were as follows (in millions): As of June 29, 2018 Original Cost Accumulated Amortization Accumulated Impairment Losses Carrying Value Customer relationships $ 556.7 $ (343.8 ) $ (20.1 ) $ 192.8 Developed technology 686.6 (316.8 ) (2.6 ) 367.2 IPRD 79.5 — (19.0 ) 60.5 Other intangibles 79.9 (57.3 ) (15.2 ) 7.4 Total intangible assets $ 1,402.7 $ (717.9 ) $ (56.9 ) $ 627.9 As of December 31, 2017 Original Cost Accumulated Amortization Accumulated Impairment Losses Carrying Value Customer relationships $ 555.9 $ (328.5 ) $ (20.1 ) $ 207.3 Developed technology 657.6 (278.2 ) (2.6 ) 376.8 IPRD 54.5 — (19.0 ) 35.5 Other intangibles 79.8 (55.9 ) (15.2 ) 8.7 Total intangible assets $ 1,347.8 $ (662.6 ) $ (56.9 ) $ 628.3 |
Summary of Amortization Expense | Amortization expense for intangible assets, with the exception of the $60.5 million of IPRD assets that will be amortized once the corresponding projects have been completed, is expected to be as follows for the remainder of 2018 , each of the next four years and thereafter (in millions): Period Amortization Expense Remainder of 2018 $ 57.1 2019 104.9 2020 89.9 2021 75.1 2022 62.9 Thereafter 177.5 Total amortization expense $ 567.4 |
Balance Sheet Information (Tabl
Balance Sheet Information (Tables) | 6 Months Ended |
Jun. 29, 2018 | |
Balance Sheet Related Disclosures [Abstract] | |
Supplemental Balance Sheet Information | Certain significant amounts included in the Company's Consolidated Balance Sheets consist of the following (in millions): As of June 29, 2018 December 31, 2017 Receivables, net: Accounts receivable $ 700.6 $ 704.2 Less: Allowance for doubtful accounts (1.8 ) (2.7 ) $ 698.8 $ 701.5 Inventories: Raw materials $ 135.4 $ 117.7 Work in process 760.4 660.8 Finished goods 308.6 311.0 $ 1,204.4 $ 1,089.5 Property, plant and equipment, net: Land $ 148.5 $ 148.4 Buildings 770.1 744.0 Machinery and equipment 3,687.0 3,454.6 Property, plant and equipment, gross 4,605.6 4,347.0 Less: Accumulated depreciation (2,218.4 ) (2,067.9 ) $ 2,387.2 $ 2,279.1 Accrued expenses: Accrued payroll and related benefits $ 185.5 $ 201.8 Sales related reserves 261.2 280.0 Income taxes payable 20.7 29.9 Other 96.5 101.1 $ 563.9 $ 612.8 |
Schedule of Product Warranty Liability | The activity related to the Company's warranty reserves was as follows (in millions): Six Months Ended June 29, 2018 June 30, 2017 Beginning Balance $ 8.0 $ 8.8 Provision (0.3 ) 2.2 Usage (0.8 ) (3.6 ) Ending Balance $ 6.9 $ 7.4 |
Schedule of Net Benefit Costs | The components of the Company's net periodic pension expense are as follows (in millions): Quarters Ended Six Months Ended June 29, 2018 June 30, 2017 June 29, 2018 June 30, 2017 Service cost $ 2.4 $ 2.3 $ 4.9 $ 4.6 Interest cost 1.2 1.1 2.4 2.1 Expected return on plan assets (1.5 ) (1.3 ) (3.1 ) (2.6 ) Total net periodic pension cost $ 2.1 $ 2.1 $ 4.2 $ 4.1 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 6 Months Ended |
Jun. 29, 2018 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | The Company's long-term debt consists of the following (annualized interest rates, in millions): As of June 29, 2018 December 31, 2017 Amended Credit Agreement: Revolving Credit Facility due 2021, interest payable monthly at 3.34% and 3.07%, respectively $ 400.0 $ 400.0 Term Loan “B” Facility due 2023, interest payable monthly at 3.84% and 3.57%, respectively 1,154.5 1,204.5 1.00% Notes due 2020 (1) 690.0 690.0 1.625% Notes due 2023 (2) 575.0 575.0 Note payable to SMBC due 2016 through 2018, interest payable quarterly at 0% and 3.09%, respectively (3) — 122.7 Other long-term debt (4) 144.6 182.8 Gross long-term debt, including current maturities 2,964.1 3,175.0 Less: Debt discount (5) (159.2 ) (178.8 ) Less: Debt issuance costs (6) (38.1 ) (44.4 ) Net long-term debt, including current maturities 2,766.8 2,951.8 Less: Current maturities (746.4 ) (248.1 ) Net long-term debt $ 2,020.4 $ 2,703.7 _______________________ (1) Interest is payable on June 1 and December 1 of each year at 1.00% annually. (2) Interest is payable on April 15 and October 15 of each year at 1.625% annually. (3) This loan represented SCI LLC's non-collateralized loan with SMBC, which was guaranteed by the Company. (4) Consists of U.S. real estate mortgages, term loans, revolving lines of credit and other facilities at certain international locations where interest is payable weekly, monthly or quarterly, interest rates range between 1.00% and 5.00% , with maturity dates between 2018 and 2020. (5) Debt discount of $52.0 million and $62.0 million for the 1.00% Notes, $96.7 million and $104.3 million for the 1.625% Notes and $10.5 million and $12.5 million for the Term Loan "B" Facility, in each case as of June 29, 2018 and December 31, 2017 , respectively. (6) Debt issuance costs of $7.3 million and $8.6 million for the 1.00% Notes, $9.3 million and $10.0 million for the 1.625% Notes and $21.5 million and $25.8 million for the Term Loan "B" Facility, in each case as of June 29, 2018 and December 31, 2017 , respectively. |
Annual Maturities Relating To Long-Term Debt | Expected maturities relating to the Company’s long-term debt (including current maturities) as of June 29, 2018 are as follows (in millions): Period Expected Maturities Remainder of 2018 $ 802.4 2019 31.2 2020 1.0 2021 400.0 2022 — Thereafter 1,729.5 Total $ 2,964.1 |
Earnings Per Share and Equity (
Earnings Per Share and Equity (Tables) | 6 Months Ended |
Jun. 29, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Calculations of net income per common share attributable to ON Semiconductor are as follows (in millions, except per share data): Quarters Ended Six Months Ended June 29, 2018 June 30, 2017 June 29, 2018 June 30, 2017 Net income attributable to ON Semiconductor Corporation $ 155.3 $ 93.9 $ 294.9 $ 172.1 Basic weighted-average common shares outstanding 427.0 420.8 426.5 420.4 Dilutive effect of share-based awards 4.6 5.1 5.2 5.6 Dilutive effect of convertible notes 12.7 — 12.7 — Diluted weighted-average common shares outstanding 444.3 425.9 444.4 426.0 Net income per common share attributable to ON Semiconductor Corporation: Basic $ 0.36 $ 0.22 $ 0.69 $ 0.41 Diluted $ 0.35 $ 0.22 $ 0.66 $ 0.40 |
Schedule of Share Repurchase Program | Information relating to the Company's share repurchase program during the quarter and six months ended June 29, 2018 , is as follows (in millions, except per share data): Quarter Ended Six Months Ended June 29, 2018 June 29, 2018 Number of repurchased shares (1) 1.7 1.7 Aggregate purchase price $ 40.0 $ 40.0 Weighted-average purchase price per share (2) $ 23.34 $ 23.34 Available for future purchases at June 29, 2018 $ 563.2 $ 563.2 (1) None of these shares had been reissued or retired as of June 29, 2018 , but may be reissued or retired by the Company at a later date. (2) Exclusive of fees, commissions and other expenses. |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 6 Months Ended |
Jun. 29, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary Of Share-Based Compensation Expense | Total share-based compensation expense related to the Company's stock options, RSUs, stock grant awards and ESPP were recorded within the Consolidated Statements of Operations and Comprehensive Income as follows (in millions): Quarters Ended Six Months Ended June 29, 2018 June 30, 2017 June 29, 2018 June 30, 2017 Cost of revenues $ 1.8 $ 1.5 $ 3.4 $ 3.0 Research and development 4.0 3.5 7.2 6.4 Selling and marketing 4.0 3.2 7.2 6.0 General and administrative 13.3 12.6 23.7 20.5 Share-based compensation expense before income taxes $ 23.1 $ 20.8 $ 41.5 $ 35.9 Related income tax benefits (1) 4.9 7.3 8.7 12.6 Share-based compensation expense, net of taxes $ 18.2 $ 13.5 $ 32.8 $ 23.3 (1) Tax benefit was calculated using the federal statutory rate of 21% and 35% for the quarters and six months ended June 29, 2018 and June 30, 2017 , respectively. |
Summary Of Restricted Stock Units Transactions | A summary of the RSU transactions for the six months ended June 29, 2018 is as follows (in millions, except per share data): Number of Shares Weighted-Average Grant Date Fair Value Per Share Non-vested RSUs at December 31, 2017 9.8 $ 12.63 Granted 2.8 24.39 Released (2.7 ) 12.22 Forfeited (0.3 ) 14.55 Non-vested RSUs at June 29, 2018 9.6 16.17 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 6 Months Ended |
Jun. 29, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Summary of Operating Leases Future Minimum Payments Receivable | The following represents future minimum lease obligations under non-cancelable operating leases as of June 29, 2018 (in millions): Remainder of 2018 $ 19.7 2019 35.0 2020 24.5 2021 19.9 2022 15.3 Thereafter 56.5 Total (1) $ 170.9 (1) Excludes $16.5 million of expected sublease income. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 29, 2018 | |
Fair Value Disclosures [Abstract] | |
Summary of Fair Value of Assets and Liabilities | The following table summarizes the Company's financial assets and liabilities, excluding pension assets, measured at fair value on a recurring basis (in millions): Fair Value Hierarchy Description As of June 29, 2018 Level 1 Level 2 Level 3 Assets: Cash and cash equivalents: Demand and time deposits $ 12.6 $ 12.6 $ — $ — Money market funds 0.3 0.3 — — During the quarter ended March 30, 2018, the Company reduced the contingent consideration payable relating to the second earn-out for the AXSEM acquisition to zero due to a revision in the Company's expectations regarding the likelihood that the earn-out would be achieved. The gain was recorded in other expense in the Consolidated Statements of Operations and Comprehensive Income. Fair Value Hierarchy Description As of December 31, 2017 Level 1 Level 2 Level 3 Assets: Cash and cash equivalents: Demand and time deposits $ 71.7 $ 71.7 $ — $ — Money market funds 0.2 0.2 — — Liabilities: Contingent consideration $ 2.3 $ — $ — $ 2.3 |
Summary of Fair Value, by Balance Sheet Grouping | The carrying amounts and fair values of the Company’s long-term borrowings (excluding capital lease obligations, real estate mortgages and equipment financing) are as follows (in millions): As of June 29, 2018 December 31, 2017 Carrying Amount Fair Value Carrying Amount Fair Value Long-term debt, including current portion Convertible notes $ 1,099.8 $ 1,641.3 $ 1,080.1 $ 1,596.7 Long-term debt $ 1,633.8 $ 1,636.4 $ 1,833.2 $ 1,845.4 |
Financial Instruments (Tables)
Financial Instruments (Tables) | 6 Months Ended |
Jun. 29, 2018 | |
Investments, All Other Investments [Abstract] | |
Schedule of Net Foreign Exchange Positions | The following summarizes the Company’s net foreign exchange positions in U.S. dollars (in millions): As of June 29, 2018 December 31, 2017 Buy (Sell) Notional Amount Buy (Sell) Notional Amount Euro $ (4.9 ) $ 4.9 $ (22.9 ) $ 22.9 Japanese Yen — — (40.0 ) 40.0 Philippine Peso 30.6 30.6 26.4 26.4 Chinese Yuan 13.0 13.0 5.3 5.3 Czech Koruna 10.3 10.3 7.6 7.6 Other Currencies - Buy 19.6 19.6 18.0 18.0 Other Currencies - Sell (8.0 ) 8.0 (10.3 ) 10.3 $ 60.6 $ 86.4 $ (15.9 ) $ 130.5 |
Changes in Accumulated Other 32
Changes in Accumulated Other Comprehensive Loss (Tables) | 6 Months Ended |
Jun. 29, 2018 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Loss | Amounts comprising the Company's accumulated other comprehensive loss and reclassifications are as follows (in millions): Currency Translation Adjustments Effects of Cash Flow Hedges Total Balance as of December 31, 2017 $ (43.2 ) $ 2.6 $ (40.6 ) Other comprehensive income prior to reclassifications 0.9 4.0 4.9 Amounts reclassified from accumulated other comprehensive loss — 0.8 0.8 Net current period other comprehensive income (1) 0.9 4.8 5.7 Balance as of June 29, 2018 $ (42.3 ) $ 7.4 $ (34.9 ) (1) Effects of cash flow hedges are net of $1.3 million of tax expense for the six months ended June 29, 2018 . Amounts which were reclassified from accumulated other comprehensive loss to the Company's Consolidated Statements of Operations and Comprehensive Income (net of tax of $0.2 million and zero for the quarters and six months ended June 29, 2018 , and June 30, 2017 , respectively, in millions): Amounts Reclassified from Accumulated Other Comprehensive Loss Quarters Ended Six Months Ended June 29, 2018 June 30, 2017 June 29, 2018 June 30, 2017 Statements of Operations and Comprehensive Income Line Item Interest rate swaps $ (0.7 ) $ — $ (0.8 ) $ 0.2 Other income and expense Total reclassifications $ (0.7 ) $ — $ (0.8 ) $ 0.2 |
Supplemental Disclosures (Table
Supplemental Disclosures (Tables) | 6 Months Ended |
Jun. 29, 2018 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Disclosures | The Company's non-cash activities and cash payments for interest and income taxes are as follows (in millions): Six Months Ended June 29, 2018 June 30, 2017 Non-cash activities: Capital expenditures in accounts payable and other liabilities $ 199.5 $ 196.4 Cash (received) paid for: Interest income $ (2.0 ) $ (1.1 ) Interest expense $ 41.0 $ 49.0 Income taxes $ 32.4 $ 35.5 |
Summary of Restrictions on Cash and Cash Equivalents | The following is a reconciliation of the captions in the Consolidated Balance Sheets to the Consolidated Statements of Cash Flows (in millions): As of June 29, 2018 December 31, 2017 June 30, 2017 December 31, 2016 Consolidated Balance Sheets: Cash and cash equivalents $ 850.2 $ 949.2 $ 871.6 $ 1,028.1 Restricted cash (included in other current assets) 17.5 17.4 17.4 17.7 Cash, cash equivalents and restricted cash in Consolidated Statements of Cash Flows $ 867.7 $ 966.6 $ 889.0 $ 1,045.8 |
Schedule of Cash and Cash Equivalents | The following is a reconciliation of the captions in the Consolidated Balance Sheets to the Consolidated Statements of Cash Flows (in millions): As of June 29, 2018 December 31, 2017 June 30, 2017 December 31, 2016 Consolidated Balance Sheets: Cash and cash equivalents $ 850.2 $ 949.2 $ 871.6 $ 1,028.1 Restricted cash (included in other current assets) 17.5 17.4 17.4 17.7 Cash, cash equivalents and restricted cash in Consolidated Statements of Cash Flows $ 867.7 $ 966.6 $ 889.0 $ 1,045.8 |
Background and Basis of Prese34
Background and Basis of Presentation (Details) $ in Millions | 3 Months Ended | 6 Months Ended | |||||
Jun. 29, 2018USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Jun. 29, 2018USD ($)segment | Jun. 30, 2017USD ($) | Jan. 01, 2018USD ($) | Dec. 31, 2017USD ($) | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Number of operating segments | segment | 3 | ||||||
Number of reportable segments | segment | 3 | ||||||
Accumulated earnings | $ 646.9 | $ 646.9 | $ 351.5 | ||||
Income before income taxes | 193.4 | $ 143.2 | $ 350.3 | $ 258.2 | |||
Distributors, repayment period | 30 days | ||||||
Repayment period of account receivable, cash discount, after the date of shipment | 10 days | ||||||
Standard product warranty, period from the date of shipment | 2 years | ||||||
Sales Agreements | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Contract with customer, revenue recognized | 1,447.9 | $ 2,820.7 | |||||
Product Development Agreements | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Contract with customer, revenue recognized | 8 | 12.8 | |||||
Difference between Revenue Guidance in Effect before and after Topic 606 | Accounting Standards Update 2014-09 | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Accumulated earnings | $ 2.1 | ||||||
Revenues from external customers | $ 1 | $ 155.1 | $ 2.8 | ||||
Income before income taxes | $ 59 | ||||||
Intelligent Sensing Group | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Standard product warranty, period from the date of shipment | 1 year |
Revenue and Segment Informati35
Revenue and Segment Information - Segment Information Of Revenues, Gross Profit And Operating Income (Details) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2018USD ($) | Jun. 30, 2017USD ($) | Jun. 29, 2018USD ($)segment | Jun. 30, 2017USD ($) | |
Segment Reporting [Abstract] | ||||
Number of reportable segments | segment | 3 | |||
Segment Reporting Information [Line Items] | ||||
Revenues | $ 1,455.9 | $ 1,338 | $ 2,833.5 | $ 2,774.7 |
Gross profit | 569 | 499.2 | 1,096.7 | 1,019.9 |
Power Solutions Group | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 748.2 | 671.4 | 1,440.8 | 1,415.2 |
Gross profit | 267.1 | 228.5 | 506.3 | 472.5 |
Analog Solutions Group | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 513.2 | 468.5 | 1,009.4 | 972.1 |
Gross profit | 219.3 | 195.8 | 426.1 | 405.1 |
Intelligent Sensing Group | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 194.5 | 198.1 | 383.3 | 387.4 |
Gross profit | $ 82.6 | $ 74.9 | $ 164.3 | $ 142.3 |
Revenue and Segment Informati36
Revenue and Segment Information - Reconciliations Of Segment Gross Profit And Segment Operating Income (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||
Gross profit for reporting segments | $ 569 | $ 499.2 | $ 1,096.7 | $ 1,019.9 |
Gross profit | 555 | 492 | 1,072.4 | 995.1 |
Operating Segments | ||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||
Gross profit for reporting segments | 569 | 499.2 | 1,096.7 | 1,019.9 |
Less: unallocated manufacturing costs | ||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||
Less: unallocated manufacturing costs | $ (14) | $ (7.2) | $ (24.3) | $ (24.8) |
Revenue and Segment Informati37
Revenue and Segment Information - Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | |
Segment Reporting Information [Line Items] | ||||
Revenues | $ 1,455.9 | $ 1,338 | $ 2,833.5 | $ 2,774.7 |
United States | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 217.5 | 416.7 | ||
United Kingdom | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 242.4 | 476 | ||
Hong Kong | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 404.9 | 765.8 | ||
Singapore | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 433.8 | 866.7 | ||
Other | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 157.3 | 308.3 | ||
Power Solutions Group | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 748.2 | 671.4 | 1,440.8 | 1,415.2 |
Power Solutions Group | United States | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 98.2 | 192.7 | ||
Power Solutions Group | United Kingdom | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 124.5 | 243.1 | ||
Power Solutions Group | Hong Kong | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 229.4 | 434.6 | ||
Power Solutions Group | Singapore | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 244.1 | 472.5 | ||
Power Solutions Group | Other | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 52 | 97.9 | ||
Analog Solutions Group | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 513.2 | 468.5 | 1,009.4 | 972.1 |
Analog Solutions Group | United States | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 85.9 | 164.1 | ||
Analog Solutions Group | United Kingdom | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 82.4 | 161.5 | ||
Analog Solutions Group | Hong Kong | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 133.1 | 255.6 | ||
Analog Solutions Group | Singapore | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 157.8 | 319 | ||
Analog Solutions Group | Other | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 54 | 109.2 | ||
Intelligent Sensing Group | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 194.5 | $ 198.1 | 383.3 | $ 387.4 |
Intelligent Sensing Group | United States | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 33.4 | 59.9 | ||
Intelligent Sensing Group | United Kingdom | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 35.5 | 71.4 | ||
Intelligent Sensing Group | Hong Kong | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 42.4 | 75.6 | ||
Intelligent Sensing Group | Singapore | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 31.9 | 75.2 | ||
Intelligent Sensing Group | Other | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 51.3 | 101.2 | ||
OEM | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 508.8 | 979 | ||
OEM | Power Solutions Group | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 219.8 | 417.9 | ||
OEM | Analog Solutions Group | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 220 | 427.6 | ||
OEM | Intelligent Sensing Group | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 69 | 133.5 | ||
Distributor | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 854.8 | 1,676.4 | ||
Distributor | Power Solutions Group | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 482 | 934.6 | ||
Distributor | Analog Solutions Group | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 257.5 | 511.6 | ||
Distributor | Intelligent Sensing Group | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 115.3 | 230.2 | ||
Electronic Manufacturing Service Provider | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 92.3 | 178.1 | ||
Electronic Manufacturing Service Provider | Power Solutions Group | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 46.4 | 88.3 | ||
Electronic Manufacturing Service Provider | Analog Solutions Group | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 35.7 | 70.2 | ||
Electronic Manufacturing Service Provider | Intelligent Sensing Group | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | $ 10.2 | $ 19.6 |
Revenue and Segment Informati38
Revenue and Segment Information - Summary of Property, Plant and Equipment by Geographic Location (Details) - USD ($) $ in Millions | Jun. 29, 2018 | Dec. 31, 2017 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property, plant and equipment, net | $ 2,387.2 | $ 2,279.1 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property, plant and equipment, net | 572.9 | 547.9 |
Korea | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property, plant and equipment, net | 396.9 | 380.5 |
Malaysia | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property, plant and equipment, net | 225 | 230 |
Philippines | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property, plant and equipment, net | 464.7 | 439.5 |
China | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property, plant and equipment, net | 254.9 | 246 |
Other | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property, plant and equipment, net | $ 472.8 | $ 435.2 |
Recent Accounting Pronounceme39
Recent Accounting Pronouncements (Details) - USD ($) $ in Millions | Jun. 29, 2018 | Jan. 01, 2018 | Dec. 31, 2017 |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Cumulative effect | $ 646.9 | $ 351.5 | |
Difference between Revenue Guidance in Effect before and after Topic 606 | Accounting Standards Update 2014-09 | |||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Cumulative effect | $ 2.1 |
Acquisitions, Divestitures an40
Acquisitions, Divestitures and Licensing Transactions - Narrative (Details) - USD ($) $ in Millions | Jun. 25, 2018 | May 08, 2018 | Nov. 29, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | Dec. 31, 2017 |
Business Acquisition [Line Items] | ||||||||
Goodwill | $ 928.8 | $ 928.8 | $ 916.9 | |||||
Gain on divestiture of business | 4.6 | $ 0 | 4.6 | $ 0 | ||||
Licensing income recognized | 1,455.9 | $ 1,338 | 2,833.5 | $ 2,774.7 | ||||
SensL | ||||||||
Business Acquisition [Line Items] | ||||||||
Percentage acquired | 100.00% | |||||||
Purchase price of acquisition | $ 71.4 | |||||||
Developed technology, weighted-average useful life (in years) | 6 years | |||||||
Goodwill | $ 15.2 | |||||||
Other acquired intangibles | SensL | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets | 30.4 | |||||||
Developed technology | SensL | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets | $ 29 | |||||||
Developed technology, weighted-average useful life (in years) | 6 years | |||||||
IPRD | SensL | ||||||||
Business Acquisition [Line Items] | ||||||||
Intangible assets | $ 25 | |||||||
Present value, discount rate used (as a percent) | 29.50% | |||||||
Disposal Group, Disposed of by Sale, Not Discontinued Operations | Transient Voltage Suppressing Diodes | ||||||||
Business Acquisition [Line Items] | ||||||||
Proceeds from divestiture of business | $ 5.6 | |||||||
Gain on divestiture of business | $ 4.6 | |||||||
HIDM | ||||||||
Business Acquisition [Line Items] | ||||||||
Proceeds from divestiture of business | 52.5 | |||||||
Deferred licenses revenue | $ 10 | |||||||
Proceeds from license fees received | 10 | |||||||
QST Co. | ||||||||
Business Acquisition [Line Items] | ||||||||
Proceeds from license fees received | $ 13 | |||||||
Proceeds from other fees | $ 8.5 | |||||||
License and Service | QST Co. | ||||||||
Business Acquisition [Line Items] | ||||||||
Licensing income recognized | $ 18 |
Acquisitions, Divestitures an41
Acquisitions, Divestitures and Licensing Transactions - Schedule of Purchase Price Allocation (Details) - USD ($) $ in Millions | May 08, 2018 | Jun. 29, 2018 | Dec. 31, 2017 |
Business Acquisition [Line Items] | |||
Goodwill | $ 928.8 | $ 916.9 | |
SensL | |||
Business Acquisition [Line Items] | |||
Current assets (including cash and cash equivalents of $0.7 million) | $ 4.2 | ||
Cash and cash equivalents | 0.7 | ||
Property, plant and equipment and other non-current assets | 1.8 | ||
Goodwill | 15.2 | ||
Total assets acquired | 76.6 | ||
Current liabilities | 0.7 | ||
Other non-current liabilities | 4.5 | ||
Total liabilities assumed | 5.2 | ||
Net assets acquired/purchase price | 71.4 | ||
Intangible assets (excluding IPRD) | SensL | |||
Business Acquisition [Line Items] | |||
Intangible assets | 30.4 | ||
IPRD | SensL | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 25 |
Goodwill and Intangible Asset42
Goodwill and Intangible Assets - Summary of Goodwill by Reportable Segment (Details) - USD ($) $ in Millions | Jun. 29, 2018 | Dec. 31, 2017 |
Goodwill | ||
Goodwill | $ 1,379.6 | $ 1,364.4 |
Accumulated Impairment Losses | (450.8) | (447.5) |
Carrying Value | 928.8 | 916.9 |
Power Solutions Group | ||
Goodwill | ||
Goodwill | 432.2 | 432.2 |
Accumulated Impairment Losses | (31.9) | (28.6) |
Carrying Value | 400.3 | 403.6 |
Analog Solutions Group | ||
Goodwill | ||
Goodwill | 836.7 | 836.7 |
Accumulated Impairment Losses | (418.9) | (418.9) |
Carrying Value | 417.8 | 417.8 |
Intelligent Sensing Group | ||
Goodwill | ||
Goodwill | 110.7 | 95.5 |
Accumulated Impairment Losses | 0 | 0 |
Carrying Value | $ 110.7 | $ 95.5 |
Goodwill and Intangible Asset43
Goodwill and Intangible Assets - Summary of Changes in Goodwill (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended |
Jun. 29, 2018 | Jun. 29, 2018 | |
Goodwill [Roll Forward] | ||
Net balance as of December 31, 2017 | $ 916.9 | |
Addition due to business combination | 15.2 | |
Goodwill impairment | $ (3.3) | (3.3) |
Net balance as of June 29, 2018 | $ 928.8 | $ 928.8 |
Goodwill and Intangible Asset44
Goodwill and Intangible Assets - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Finite-Lived Intangible Assets [Line Items] | |||||
Goodwill impairment | $ 3.3 | $ 3.3 | |||
Amortization of acquisition-related intangible assets | 27.9 | $ 28.6 | 55.3 | $ 57.7 | |
Intangible assets, net | 627.9 | 627.9 | $ 628.3 | ||
IPRD | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Intangible assets, net | $ 60.5 | $ 60.5 | $ 35.5 |
Goodwill and Intangible Asset45
Goodwill and Intangible Assets - Summary of Intangible Assets, Net (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Jun. 29, 2018 | Dec. 31, 2017 | |
Intangible Assets, Net | ||
Original Cost | $ 1,402.7 | $ 1,347.8 |
Accumulated Amortization | (717.9) | (662.6) |
Accumulated Impairment Losses | (56.9) | (56.9) |
Carrying Value | 627.9 | 628.3 |
Customer relationships | ||
Intangible Assets, Net | ||
Original Cost | 556.7 | 555.9 |
Accumulated Amortization | (343.8) | (328.5) |
Accumulated Impairment Losses | (20.1) | (20.1) |
Carrying Value | 192.8 | 207.3 |
Developed technology | ||
Intangible Assets, Net | ||
Original Cost | 686.6 | 657.6 |
Accumulated Amortization | (316.8) | (278.2) |
Accumulated Impairment Losses | (2.6) | (2.6) |
Carrying Value | 367.2 | 376.8 |
IPRD | ||
Intangible Assets, Net | ||
Original Cost | 79.5 | 54.5 |
Accumulated Amortization | 0 | 0 |
Accumulated Impairment Losses | (19) | (19) |
Carrying Value | 60.5 | 35.5 |
Other intangibles | ||
Intangible Assets, Net | ||
Original Cost | 79.9 | 79.8 |
Accumulated Amortization | (57.3) | (55.9) |
Accumulated Impairment Losses | (15.2) | (15.2) |
Carrying Value | $ 7.4 | $ 8.7 |
Goodwill and Intangible Asset46
Goodwill and Intangible Assets - Summary of Amortization Expense (Details) $ in Millions | Jun. 29, 2018USD ($) |
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule | |
Remainder of 2018 | $ 57.1 |
2,019 | 104.9 |
2,020 | 89.9 |
2,021 | 75.1 |
2,022 | 62.9 |
Thereafter | 177.5 |
Total amortization expense | $ 567.4 |
Balance Sheet Information - Sc
Balance Sheet Information - Schedule of Balance Sheet Information (Details) - USD ($) $ in Millions | Jun. 29, 2018 | Dec. 31, 2017 |
Receivables, net: | ||
Accounts receivable | $ 700.6 | $ 704.2 |
Less: Allowance for doubtful accounts | (1.8) | (2.7) |
Receivables, net | 698.8 | 701.5 |
Inventories: | ||
Raw materials | 135.4 | 117.7 |
Work in process | 760.4 | 660.8 |
Finished goods | 308.6 | 311 |
Inventories | 1,204.4 | 1,089.5 |
Property, plant and equipment, net: | ||
Land | 148.5 | 148.4 |
Buildings | 770.1 | 744 |
Machinery and equipment | 3,687 | 3,454.6 |
Property, plant and equipment, gross | 4,605.6 | 4,347 |
Less: Accumulated depreciation | (2,218.4) | (2,067.9) |
Property, plant and equipment, net | 2,387.2 | 2,279.1 |
Accrued expenses: | ||
Accrued payroll and related benefits | 185.5 | 201.8 |
Sales related reserves | 261.2 | 280 |
Income taxes payable | 20.7 | 29.9 |
Other | 96.5 | 101.1 |
Accrued expenses | $ 563.9 | $ 612.8 |
Balance Sheet Information - Na
Balance Sheet Information - Narrative (Details) - USD ($) $ in Millions | Jun. 29, 2018 | Dec. 31, 2017 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Assets held-for-sale | $ 1.4 | $ 5.3 |
Accrued pension liability | 110.4 | 109.3 |
Current portion accrued pension liability | $ 0.3 | 0.2 |
Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Proceeds from sale of assets held-for-sale | $ 5.5 |
Balance Sheet Information - Wa
Balance Sheet Information - Warranty Reserves (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 29, 2018 | Jun. 30, 2017 | |
Warranty Reserves | ||
Beginning Balance | $ 8 | $ 8.8 |
Provision | (0.3) | 2.2 |
Usage | (0.8) | (3.6) |
Ending Balance | $ 6.9 | $ 7.4 |
Balance Sheet Information - Pe
Balance Sheet Information - Periodic Pension Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | |
Balance Sheet Related Disclosures [Abstract] | ||||
Service cost | $ 2.4 | $ 2.3 | $ 4.9 | $ 4.6 |
Interest cost | 1.2 | 1.1 | 2.4 | 2.1 |
Expected return on plan assets | (1.5) | (1.3) | (3.1) | (2.6) |
Total net periodic pension cost | $ 2.1 | $ 2.1 | $ 4.2 | $ 4.1 |
Long-Term Debt - Schedule of Lo
Long-Term Debt - Schedule of Long Term Debt (Details) - USD ($) $ in Millions | Jun. 29, 2018 | May 31, 2018 | Dec. 31, 2017 | Jun. 08, 2015 |
Debt Instrument [Line Items] | ||||
Carrying Amount | $ 2,964.1 | $ 3,175 | ||
Capital lease obligations | 104.4 | |||
Debt discount | (159.2) | (178.8) | ||
Debt issuance costs | (38.1) | $ (1.1) | (44.4) | |
Net long-term debt, including current maturities | 2,766.8 | 2,951.8 | ||
Less: Current maturities | (746.4) | (248.1) | ||
Net long-term debt | 2,020.4 | 2,703.7 | ||
Debt discount | 159.2 | 178.8 | ||
Debt issuance costs | 38.1 | $ 1.1 | 44.4 | |
Revolving Credit Facility due 2021, interest payable monthly at 3.34% and 3.07%, respectively | ||||
Debt Instrument [Line Items] | ||||
Carrying Amount | $ 400 | $ 400 | ||
Debt instrument, interest rate (as a percent) | 3.34% | 3.07% | ||
Term Loan “B” Facility due 2023, interest payable monthly at 3.84% and 3.57%, respectively | ||||
Debt Instrument [Line Items] | ||||
Carrying Amount | $ 1,154.5 | $ 1,204.5 | ||
Debt discount | (10.5) | (12.5) | ||
Debt issuance costs | $ (21.5) | $ (25.8) | ||
Debt instrument, interest rate (as a percent) | 3.84% | 3.57% | ||
Debt discount | $ 10.5 | $ 12.5 | ||
Debt issuance costs | 21.5 | 25.8 | ||
Note payable to SMBC due 2016 through 2018, interest payable quarterly at 0% and 3.09%, respectively | ||||
Debt Instrument [Line Items] | ||||
Carrying Amount | $ 0 | $ 122.7 | ||
Debt instrument, interest rate (as a percent) | 0.00% | 3.09% | ||
Other Debt | ||||
Debt Instrument [Line Items] | ||||
Capital lease obligations | $ 144.6 | $ 182.8 | ||
1.00% Notes | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, interest rate (as a percent) | 1.00% | |||
1.00% Notes | Convertible Debt | ||||
Debt Instrument [Line Items] | ||||
Carrying Amount | $ 690 | 690 | ||
Debt discount | (52) | (62) | ||
Debt issuance costs | (7.3) | (8.6) | ||
Less: Current maturities | $ (630.7) | |||
Debt instrument, interest rate (as a percent) | 1.00% | 1.00% | ||
Debt discount | $ 52 | 62 | ||
Debt issuance costs | 7.3 | 8.6 | ||
1.625% Notes | Convertible Debt | ||||
Debt Instrument [Line Items] | ||||
Carrying Amount | 575 | 575 | ||
Debt discount | (96.7) | (104.3) | ||
Debt issuance costs | $ (9.3) | (10) | ||
Debt instrument, interest rate (as a percent) | 1.625% | |||
Debt discount | $ 96.7 | 104.3 | ||
Debt issuance costs | $ 9.3 | $ 10 | ||
Minimum | Other Debt | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, interest rate (as a percent) | 1.00% | |||
Maximum | Other Debt | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, interest rate (as a percent) | 5.00% |
Long-Term Debt - Annual Maturit
Long-Term Debt - Annual Maturities Relating To Long-Term Debt (Details) $ in Millions | Jun. 29, 2018USD ($) |
Long-term Debt, Fiscal Year Maturity [Abstract] | |
Remainder of 2018 | $ 802.4 |
2,019 | 31.2 |
2,020 | 1 |
2,021 | 400 |
2,022 | 0 |
Thereafter | 1,729.5 |
Total | $ 2,964.1 |
Long-Term Debt - Narrative (Det
Long-Term Debt - Narrative (Details) | May 31, 2018USD ($) | Jun. 08, 2015USD ($)d$ / shares | Jan. 31, 2013USD ($) | Jun. 29, 2018USD ($)$ / shares | Jun. 29, 2018USD ($)d$ / shares | Jun. 30, 2017USD ($) | Dec. 31, 2017USD ($) |
Debt Instrument [Line Items] | |||||||
Debt issuance costs | $ 1,100,000 | $ 38,100,000 | $ 38,100,000 | $ 44,400,000 | |||
Unamortized debt discount and debt issuance costs | 1,500,000 | ||||||
Debt extinguishment charge | 2,600,000 | ||||||
Unamortized debt discount and issuance costs expensed | 1,100,000 | $ 2,400,000 | |||||
Current portion of long-term debt | 746,400,000 | 746,400,000 | 248,100,000 | ||||
Long-term debt | $ 2,964,100,000 | $ 2,964,100,000 | $ 3,175,000,000 | ||||
Notes Payable to Banks | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, interest rate (as a percent) | 0.00% | 0.00% | 3.09% | ||||
Debt instrument, term | 7 years | ||||||
Long-term debt | $ 0 | $ 0 | $ 122,700,000 | ||||
1.00% Notes | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, interest rate (as a percent) | 1.00% | 1.00% | |||||
1.00% Notes | Convertible Debt | |||||||
Debt Instrument [Line Items] | |||||||
Debt issuance costs | $ 7,300,000 | $ 7,300,000 | 8,600,000 | ||||
Debt instrument, face amount | $ 690,000,000 | ||||||
Debt instrument, interest rate (as a percent) | 1.00% | 1.00% | 1.00% | ||||
Conversion ratio (in shares) | 0.0540643 | ||||||
Conversion price per share (in dollars per share) | $ / shares | $ 18.50 | $ 24.05 | $ 24.05 | ||||
Current portion of long-term debt | $ 630,700,000 | $ 630,700,000 | |||||
Long-term debt | 690,000,000 | $ 690,000,000 | $ 690,000,000 | ||||
Debt Conversion, Period One | 1.00% Notes | Convertible Debt | |||||||
Debt Instrument [Line Items] | |||||||
Convertible debt instrument, threshold trading days | d | 20 | 20 | |||||
Convertible debt instrument threshold consecutive trading days | d | 30 | 30 | |||||
Convertible debt instrument threshold percentage of stock price trigger | 130.00% | 130.00% | |||||
Debt Conversion, Period Two | 1.00% Notes | Convertible Debt | |||||||
Debt Instrument [Line Items] | |||||||
Convertible debt instrument threshold consecutive trading days | d | 5 | ||||||
Convertible debt instrument period after consecutive trading days | 5 days | ||||||
Convertible debt instrument, ratio of trading price per 1000 principal amount | 0.98 | ||||||
SANYO Electric | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, face amount | $ 377,500,000 | ||||||
Line of Credit | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit facility, borrowing capacity | 1,000,000,000 | ||||||
Line of Credit | Term Loan B Facility | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit facility, borrowing capacity | $ 2,400,000,000 | ||||||
Prepayment of debt | 50,000,000 | ||||||
Unamortized debt discount and issuance costs expensed | $ 1,400,000 | ||||||
Line of Credit | London Interbank Offered Rate (LIBOR) | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate | 1.25% | ||||||
Line of Credit | London Interbank Offered Rate (LIBOR) | Term Loan B Facility | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate | 1.75% | ||||||
Line of Credit | Federal Funds Rate | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate | 0.50% | ||||||
Line of Credit | Adjusted LIBOR | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate | 1.00% | ||||||
Line of Credit | Adjusted LIBOR | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate | 0.25% | ||||||
Line of Credit | Adjusted LIBOR | Term Loan B Facility | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate | 0.75% |
Earnings Per Share and Equity -
Earnings Per Share and Equity - Income per Share Calculations (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | |
Earnings Per Share [Abstract] | ||||
Net income attributable to ON Semiconductor Corporation | $ 155.3 | $ 93.9 | $ 294.9 | $ 172.1 |
Basic weighted average common shares outstanding (in shares) | 427 | 420.8 | 426.5 | 420.4 |
Dilutive effect of share-based awards (in shares) | 4.6 | 5.1 | 5.2 | 5.6 |
Dilutive effect of convertible notes (in shares) | 12.7 | 0 | 12.7 | 0 |
Diluted weighted average common shares outstanding (in shares) | 444.3 | 425.9 | 444.4 | 426 |
Net income per common share attributable to ON Semiconductor Corporation: | ||||
Basic (in dollars per share) | $ 0.36 | $ 0.22 | $ 0.69 | $ 0.41 |
Diluted (in dollars per share) | $ 0.35 | $ 0.22 | $ 0.66 | $ 0.40 |
Earnings Per Share and Equity55
Earnings Per Share and Equity - Narrative (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | Jun. 08, 2015 | |
Dividends Payable [Line Items] | ||||||
Anti-dilutive shares | 0 | 0 | 300,000 | 500,000 | ||
Payments of tax withholding for restricted shares | $ 1,100,000 | $ 600,000 | $ 19,900,000 | $ 13,600,000 | ||
Common stock withheld underlying restricted stock units (less than) | 100,000 | 100,000 | 800,000 | 900,000 | ||
Treasury stock, shares, reissued or retired during period | 0 | |||||
Non-controlling interest in consolidated subsidiary | $ 24,100,000 | $ 24,100,000 | $ 22,200,000 | |||
Non-controlling interest share of earnings | $ 1,000,000 | $ 500,000 | $ 1,900,000 | $ 1,000,000 | ||
1.00% Notes | ||||||
Dividends Payable [Line Items] | ||||||
Debt instrument, interest rate (as a percent) | 1.00% | 1.00% | ||||
Convertible Debt | 1.00% Notes | ||||||
Dividends Payable [Line Items] | ||||||
Debt instrument, interest rate (as a percent) | 1.00% | 1.00% | 1.00% | |||
Average price of common stock to exceed to include effect of additional potential shares (in dollars per share) | $ 25.96 | |||||
Conversion price per share (in dollars per share) | $ 24.05 | 24.05 | $ 18.50 | |||
Convertible Debt | 1.00% Notes | Embedded Derivative Financial Instruments | ||||||
Dividends Payable [Line Items] | ||||||
Conversion price per share (in dollars per share) | $ 18.5 | $ 18.5 | ||||
Convertible Debt | 1.625% Notes | ||||||
Dividends Payable [Line Items] | ||||||
Debt instrument, interest rate (as a percent) | 1.625% | 1.625% | ||||
Average price of common stock to exceed to include effect of additional potential shares (in dollars per share) | $ 30.70 | |||||
Convertible Debt | 1.625% Notes | Embedded Derivative Financial Instruments | ||||||
Dividends Payable [Line Items] | ||||||
Conversion price per share (in dollars per share) | $ 20.72 | $ 20.72 | ||||
Leshan | ||||||
Dividends Payable [Line Items] | ||||||
Percentage of ownership on domestic subsidiaries | 80.00% | 80.00% | ||||
Share Repurchase Program | ||||||
Dividends Payable [Line Items] | ||||||
Common stock repurchased, amount | $ 40,000,000 | $ 0 | $ 40,000,000 | $ 25,000,000 | ||
Stock repurchase program, authorized amount | 1,000,000,000 | $ 1,000,000,000 | ||||
Stock repurchase program period | 4 years | |||||
Remaining authorized amount available for repurchase | $ 563,200,000 | $ 563,200,000 |
Earnings Per Share and Equity56
Earnings Per Share and Equity - Summary of Share Repurchase Program Activity (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | |
Jun. 29, 2018 | Jun. 29, 2018 | Jun. 30, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Aggregate purchase price | $ 40 | $ 25 | |
Share Repurchase Program | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of repurchased shares | 1.7 | 1.7 | |
Aggregate purchase price | $ 40 | $ 40 | |
Weighted-average purchase price per share | $ 23.34 | $ 23.34 | |
Available for future purchases at June 29, 2018 | $ 563.2 | $ 563.2 |
Share-Based Compensation - Sum
Share-Based Compensation - Summary Of Share-Based Compensation Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense before income taxes | $ 23.1 | $ 20.8 | $ 41.5 | $ 35.9 |
Related income tax benefits | 4.9 | 7.3 | 8.7 | 12.6 |
Share-based compensation expense, net of taxes | $ 18.2 | $ 13.5 | $ 32.8 | $ 23.3 |
U.S. federal statutory rate (as a percent) | 21.00% | 35.00% | 21.00% | 35.00% |
Cost of revenues | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense before income taxes | $ 1.8 | $ 1.5 | $ 3.4 | $ 3 |
Research and development | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense before income taxes | 4 | 3.5 | 7.2 | 6.4 |
Selling and marketing | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense before income taxes | 4 | 3.2 | 7.2 | 6 |
General and administrative | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense before income taxes | $ 13.3 | $ 12.6 | $ 23.7 | $ 20.5 |
Share-Based Compensation - Nar
Share-Based Compensation - Narrative (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Cash received from exercise of stock options | $ 4.3 | $ 9.2 | |||
Options outstanding (in shares) | 0.5 | 0.5 | 1.1 | ||
Weighted average exercise price, outstanding (in dollars per share) | $ 6.87 | $ 6.87 | $ 6.95 | ||
Options exercised during period (in shares) | 0.6 | ||||
Weighted average exercise price, exercised (in dollars per share) | $ 7.01 | ||||
Amended And Restated Stock Incentive Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Aggregate of common stock available for grant | 35 | 35 | 39 | ||
Restricted Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Unrecognized share-based compensation expense on non-vested stock options | $ 112 | $ 112 | |||
Stock option, weighted average period for recognition | 1 year 9 months 5 days | ||||
Options pre-vesting forfeitures estimated | 5.00% | 5.00% | 5.00% | 5.00% | |
Maximum award vesting period (in years) | 3 years | ||||
Employee Stock Options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Total intrinsic value of stock options exercised | $ 1.1 | $ 10.5 | |||
Cash received from exercise of stock options | $ 0.6 | $ 4.3 | |||
Options pre-vesting forfeitures estimated | 11.00% | 11.00% | 11.00% | 11.00% | |
Employee Stock Purchase Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Aggregate of common stock available for grant | 7.6 | 7.6 | 8 | ||
Less than $22.24 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Exercise price range, upper range limit (in dollars per share) | $ 22.24 |
Share-Based Compensation - S59
Share-Based Compensation - Summary Of Restricted Stock Units Transactions (Details) - Restricted Stock Units shares in Millions | 6 Months Ended |
Jun. 29, 2018$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Nonvested shares underlying restricted stock units, beginning (in shares) | shares | 9.8 |
Restricted stock units granted (in shares) | shares | 2.8 |
Restricted stock units released (in shares) | shares | (2.7) |
Restricted stock units forfeited (in shares) | shares | (0.3) |
Nonvested shares underlying restricted stock units, ending (in shares) | shares | 9.6 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | |
Weighted Average Grant Date Fair Value, Nonvested, beginning (in dollars per share) | $ / shares | $ 12.63 |
Weighted Average Grant Date Fair Value, Granted (in dollars per share) | $ / shares | 24.39 |
Weighted-Average Grant Date Fair Value, Released (in dollars per share) | $ / shares | 12.22 |
Weighted Average Grant Date Fair Value, Forfeited (in dollars per share) | $ / shares | 14.55 |
Weighted Average Grant Date Fair Value, Nonvested, ending (in dollars per share) | $ / shares | $ 16.17 |
Commitments and Contingencies
Commitments and Contingencies - Operating Leases Future Minimum Payments Receivable (Details) $ in Millions | 6 Months Ended |
Jun. 29, 2018USD ($) | |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
Remainder of 2018 | $ 19.7 |
2,019 | 35 |
2,020 | 24.5 |
2,021 | 19.9 |
2,022 | 15.3 |
Thereafter | 56.5 |
Total | 170.9 |
Sublease Income | $ 16.5 |
Commitments and Contingencies61
Commitments and Contingencies - Narrative (Details) $ in Thousands | Mar. 09, 2017patent | Aug. 11, 2016patent | Oct. 14, 2008claim | Dec. 31, 2016claim | Nov. 30, 2016patent | Dec. 31, 2015USD ($) | May 31, 2015USD ($) | Nov. 30, 2014USD ($) | Mar. 31, 2013USD ($) | May 31, 2012patent | Apr. 30, 2012claim | Jan. 31, 2011USD ($) | Dec. 31, 2008USD ($) | Jun. 29, 2018USD ($)claimreview | Dec. 31, 2015patent | Dec. 31, 2014USD ($)patent | Dec. 31, 2009patent | Dec. 31, 2008claim | Dec. 31, 2006USD ($) |
Loss Contingencies [Line Items] | |||||||||||||||||||
Outstanding guarantees and letters of credit | $ 6,100 | ||||||||||||||||||
Guarantees related to capital lease obligations | 104,400 | ||||||||||||||||||
Revolving Credit Facility | Line of Credit | |||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||
Line of credit, current borrowing capacity | 15,000 | ||||||||||||||||||
Letter of Credit | Line of Credit | |||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||
Credit commitment outstanding | $ 100 | ||||||||||||||||||
Power Integrations, Inc. | |||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||
Number of outstanding proceedings | claim | 8 | ||||||||||||||||||
Power Integrations, Inc. | Minimum | |||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||
Loss contingency, estimate of possible loss | $ 4,000 | ||||||||||||||||||
Power Integrations, Inc. | Maximum | |||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||
Loss contingency, estimate of possible loss | $ 20,000 | ||||||||||||||||||
Power Integrations, Northern District of California, 2016 | |||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||
Loss contingency, number of patents allegedly infringed upon | patent | 6 | ||||||||||||||||||
Number of patents requiring declaratory judgment | patent | 2 | ||||||||||||||||||
Power Integrations, Arizona, 2016 | |||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||
Gain contingency, number of patents allegedly infringed upon | patent | 6 | ||||||||||||||||||
Number of patents requiring declaratory judgment | patent | 3 | ||||||||||||||||||
Power Integrations, Delaware, 2017 | |||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||
Loss contingency, number of patents allegedly infringed upon | patent | 7 | ||||||||||||||||||
Gain contingency, number of patents allegedly infringed upon | patent | 6 | ||||||||||||||||||
Power Integrations, Inc., USPTO | |||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||
Patents reviewed and found unpatentable | review | 2 | ||||||||||||||||||
Inter party review | review | 5 | ||||||||||||||||||
Fairchild | |||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||
Maximum remediation cost recoveries receivable | $ 150,000 | ||||||||||||||||||
Fairchild | Power Integrations, Inc. | |||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||
Number of outstanding proceedings | claim | 5 | ||||||||||||||||||
Fairchild | Power Integrations, Delaware, 2004 | |||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||
Litigation settlement, amount paid | $ 12,200 | $ 6,100 | $ 34,000 | ||||||||||||||||
Loss contingency, number of patents allegedly infringed upon | claim | 2 | ||||||||||||||||||
Fairchild | Power Integrations, Delaware, 2004 | Maximum | |||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||
Value of sales and imports of affected products | $ 750 | ||||||||||||||||||
Fairchild | Power Integrations, Delaware, 2008 | |||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||
Loss contingency, number of patents allegedly infringed upon | claim | 4 | ||||||||||||||||||
Gain contingency, number of patents found infringed upon | claim | 1 | ||||||||||||||||||
Gain contingency, number of patents allegedly infringed upon | claim | 2 | ||||||||||||||||||
Loss contingency, number of patents infringed upon | claim | 2 | ||||||||||||||||||
Loss contingency, number of patents found not infringed upon | claim | 1 | ||||||||||||||||||
Fairchild | Power Integrations, Northern District of California, 2009 | |||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||
Litigation settlement, amount paid | $ 139,800 | $ 105,000 | |||||||||||||||||
Loss contingency, number of patents allegedly infringed upon | patent | 3 | ||||||||||||||||||
Gain contingency, number of patents allegedly infringed upon | patent | 2 | ||||||||||||||||||
Loss contingency, number of patents infringed upon | patent | 2 | ||||||||||||||||||
Litigation settlement, amount vacated | $ 105,000 | ||||||||||||||||||
Litigation settlement interest | $ 7,000 | ||||||||||||||||||
Fairchild | Power Integrations, Delaware, 2012 | |||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||
Loss contingency, number of patents allegedly infringed upon | patent | 5 | ||||||||||||||||||
Loss contingency, number of patents found not infringed upon | patent | 1 | ||||||||||||||||||
Litigation settlement, amount awarded from other party | $ 2,400 | ||||||||||||||||||
Fairchild | Power Integrations, Delaware, 2012, 2 | |||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||
Litigation settlement, amount paid | $ 100 | ||||||||||||||||||
Fairchild | Power Integrations, Northern District of California, 2015 | |||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||
Loss contingency, number of patents allegedly infringed upon | patent | 2 | ||||||||||||||||||
Gain contingency, number of patents allegedly infringed upon | patent | 4 | ||||||||||||||||||
Fairchild | |||||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||||
Business acquisition, maximum indemnification period | 6 years |
Fair Value Measurements - Summ
Fair Value Measurements - Summary of Fair Value of Assets and Liabilities Measured on Recurring Basis (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Millions | Jun. 29, 2018 | Dec. 31, 2017 |
Fair Value, Inputs, Level 1 | ||
Liabilities | ||
Contingent consideration | $ 0 | |
Fair Value, Inputs, Level 1 | Demand and time deposits | ||
Assets | ||
Cash and cash equivalents | $ 12.6 | 71.7 |
Fair Value, Inputs, Level 1 | Money market funds | ||
Assets | ||
Cash and cash equivalents | 0.3 | 0.2 |
Fair Value, Inputs, Level 2 | ||
Liabilities | ||
Contingent consideration | 0 | |
Fair Value, Inputs, Level 2 | Demand and time deposits | ||
Assets | ||
Cash and cash equivalents | 0 | 0 |
Fair Value, Inputs, Level 2 | Money market funds | ||
Assets | ||
Cash and cash equivalents | 0 | 0 |
Fair Value, Inputs, Level 3 | ||
Liabilities | ||
Contingent consideration | 2.3 | |
Fair Value, Inputs, Level 3 | Demand and time deposits | ||
Assets | ||
Cash and cash equivalents | 0 | 0 |
Fair Value, Inputs, Level 3 | Money market funds | ||
Assets | ||
Cash and cash equivalents | 0 | 0 |
Estimate of Fair Value | ||
Liabilities | ||
Contingent consideration | 2.3 | |
Estimate of Fair Value | Demand and time deposits | ||
Assets | ||
Cash and cash equivalents | 12.6 | 71.7 |
Estimate of Fair Value | Money market funds | ||
Assets | ||
Cash and cash equivalents | $ 0.3 | $ 0.2 |
Fair Value Measurements - Su63
Fair Value Measurements - Summary of Carrying Amounts and Fair Values of Long-Term Borrowings (Details) - USD ($) $ in Millions | Jun. 29, 2018 | Dec. 31, 2017 |
Carrying Amount | $ 2,964.1 | $ 3,175 |
Convertible notes | ||
Carrying Amount | 1,099.8 | 1,080.1 |
Fair Value | 1,641.3 | 1,596.7 |
Long-term debt | ||
Carrying Amount | 1,633.8 | 1,833.2 |
Fair Value | $ 1,636.4 | $ 1,845.4 |
Fair Value Measurements - Narr
Fair Value Measurements - Narrative (Details) - USD ($) | Apr. 01, 2018 | Jun. 29, 2018 | Mar. 30, 2018 | Dec. 31, 2017 | Jun. 08, 2015 |
Debt Instrument [Line Items] | |||||
Cost method investments, fair value | $ 7,400,000 | $ 12,600,000 | |||
Incremental ownership share of AFSM | 30.00% | ||||
Purchase price of production facility | $ 19,800,000 | ||||
Ownership interest in AFSM following transaction (as a percent) | 40.00% | ||||
Aggregate investment in AFSM | $ 26,200,000 | ||||
Required increase in ownership percentage, period of one to six months | 60.00% | ||||
Required increase in ownership percentage, period of nine and eighteen months | 100.00% | ||||
1.00% Notes | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, interest rate (as a percent) | 1.00% | ||||
Convertible Debt | 1.00% Notes | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, interest rate (as a percent) | 1.00% | 1.00% | |||
Convertible Debt | 1.625% Notes | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, interest rate (as a percent) | 1.625% | ||||
AXSEM | |||||
Debt Instrument [Line Items] | |||||
Contingent consideration relating to the second earn-out | $ 0 | ||||
Purchase Of Inventory | Affiliated Entity | |||||
Debt Instrument [Line Items] | |||||
Inventory purchased from related party | $ 7,300,000 | ||||
Payable to AFSM | $ 1,600,000 |
Financial Instruments - Narrat
Financial Instruments - Narrative (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Derivatives, Fair Value [Line Items] | |||||
Foreign currency transaction gain (loss) realized | $ (2,200,000) | $ 100,000 | $ (6,600,000) | $ (2,800,000) | |
Hedge ineffectiveness | 0 | $ 0 | |||
Foreign currency exchange contracts | |||||
Derivatives, Fair Value [Line Items] | |||||
Notional amount | $ 86,400,000 | $ 86,400,000 | $ 130,500,000 | ||
Foreign currency exchange contracts | Minimum | |||||
Derivatives, Fair Value [Line Items] | |||||
Derivative, term of contract (in months) | 1 month | ||||
Foreign currency exchange contracts | Maximum | |||||
Derivatives, Fair Value [Line Items] | |||||
Derivative, term of contract (in months) | 3 months | ||||
Convertible Debt | 1.00% Notes | |||||
Derivatives, Fair Value [Line Items] | |||||
Debt instrument, interest rate (as a percent) | 1.00% | 1.00% | |||
Convertible Debt | 1.625% Notes | |||||
Derivatives, Fair Value [Line Items] | |||||
Debt instrument, interest rate (as a percent) | 1.625% | 1.625% |
Financial Instruments - Schedu
Financial Instruments - Schedule of Net Foreign Exchange Positions (Details) - Foreign currency exchange contracts - USD ($) $ in Millions | Jun. 29, 2018 | Dec. 31, 2017 |
Derivatives, Fair Value [Line Items] | ||
Buy (Sell) | $ 60.6 | $ (15.9) |
Notional Amount | 86.4 | 130.5 |
Other Currencies - Buy | ||
Derivatives, Fair Value [Line Items] | ||
Buy (Sell) | 19.6 | 18 |
Notional Amount | 19.6 | 18 |
Other Currencies - Sell | ||
Derivatives, Fair Value [Line Items] | ||
Buy (Sell) | (8) | (10.3) |
Notional Amount | 8 | 10.3 |
Euro | ||
Derivatives, Fair Value [Line Items] | ||
Buy (Sell) | (4.9) | (22.9) |
Notional Amount | 4.9 | 22.9 |
Japanese Yen | ||
Derivatives, Fair Value [Line Items] | ||
Buy (Sell) | 0 | (40) |
Notional Amount | 0 | 40 |
Philippine Peso | ||
Derivatives, Fair Value [Line Items] | ||
Buy (Sell) | 30.6 | 26.4 |
Notional Amount | 30.6 | 26.4 |
Chinese Yuan | ||
Derivatives, Fair Value [Line Items] | ||
Buy (Sell) | 13 | 5.3 |
Notional Amount | 13 | 5.3 |
Czech Koruna | ||
Derivatives, Fair Value [Line Items] | ||
Buy (Sell) | 10.3 | 7.6 |
Notional Amount | $ 10.3 | $ 7.6 |
Income Taxes Income Taxes (Deta
Income Taxes Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||||
Effective income tax rate (as a percent) | 19.20% | 15.30% | |||
U.S. federal statutory rate (as a percent) | 21.00% | 35.00% | 21.00% | 35.00% | |
Deferred tax assets, release of reserves and interest for uncertain tax positions | $ 8.9 | $ 8.9 | |||
Change in deferred tax asset valuation allowance and release of allowance against deferred tax assets | 2.8 | 19.9 | |||
Release of valuation allowance against deferred tax assets | 7.1 | ||||
Provisional tax benefit | $ 449.9 | ||||
Unrecognized tax benefits, income tax penalties and interest accrued | 4 | $ 5 | 4 | $ 5 | |
Possible reduction in unrecognized tax benefits in next twelve months | $ 7.5 | $ 7.5 |
Changes in Accumulated Other 68
Changes in Accumulated Other Comprehensive Loss - Components of Other Comprehensive Income (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | |
Accumulated Other Comprehensive Income [Roll Forward] | ||||
Balance, beginning | $ 2,801 | |||
Other comprehensive income (loss) prior to reclassifications | 4.9 | |||
Amounts reclassified from accumulated other comprehensive loss | 0.8 | |||
Other comprehensive income (loss), net of tax | $ (0.5) | $ (0.7) | 5.7 | $ 6.4 |
Balance, ending | 3,096.8 | 3,096.8 | ||
Cash flow hedges, tax | 1.3 | |||
Currency Translation Adjustments | ||||
Accumulated Other Comprehensive Income [Roll Forward] | ||||
Balance, beginning | (43.2) | |||
Other comprehensive income (loss) prior to reclassifications | 0.9 | |||
Amounts reclassified from accumulated other comprehensive loss | 0 | |||
Other comprehensive income (loss), net of tax | 0.9 | |||
Balance, ending | (42.3) | (42.3) | ||
Effects of Cash Flow Hedges | ||||
Accumulated Other Comprehensive Income [Roll Forward] | ||||
Balance, beginning | 2.6 | |||
Other comprehensive income (loss) prior to reclassifications | 4 | |||
Amounts reclassified from accumulated other comprehensive loss | 0.8 | |||
Other comprehensive income (loss), net of tax | 4.8 | |||
Balance, ending | 7.4 | 7.4 | ||
Total | ||||
Accumulated Other Comprehensive Income [Roll Forward] | ||||
Balance, beginning | (40.6) | |||
Balance, ending | $ (34.9) | $ (34.9) |
Changes in Accumulated Other 69
Changes in Accumulated Other Comprehensive Loss - Reclassifications from Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 29, 2018 | Jun. 30, 2017 | Jun. 29, 2018 | Jun. 30, 2017 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Reclassifications, tax | $ 0.2 | $ 0 | $ 0.2 | $ 0 |
Other income and expense | 3.8 | 10.8 | 32.6 | 78.9 |
Net income | (156.3) | (94.4) | (296.8) | (173.1) |
Reclassification out of Accumulated Other Comprehensive Income | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Net income | (0.7) | 0 | (0.8) | 0.2 |
Effects of Cash Flow Hedges | Reclassification out of Accumulated Other Comprehensive Income | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Other income and expense | $ (0.7) | $ 0 | $ (0.8) | $ 0.2 |
Supplemental Disclosures - Non
Supplemental Disclosures - Non-Cash Financing Activities And Cash Payments (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 29, 2018 | Jun. 30, 2017 | |
Non-cash activities: | ||
Capital expenditures in accounts payable and other liabilities | $ 199.5 | $ 196.4 |
Cash (received) paid for: | ||
Interest income | (2) | (1.1) |
Interest expense | 41 | 49 |
Income taxes | $ 32.4 | $ 35.5 |
Supplemental Disclosures - Rec
Supplemental Disclosures - Reconciliation of Cash in the Balance Sheet and Statement of Cash Flows (Details) - USD ($) $ in Millions | Jun. 29, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | Dec. 31, 2016 |
Supplemental Cash Flow Elements [Abstract] | ||||
Cash and cash equivalents | $ 850.2 | $ 949.2 | $ 871.6 | $ 1,028.1 |
Restricted cash (included in other current assets) | 17.5 | 17.4 | 17.4 | 17.7 |
Cash, cash equivalents and restricted cash in Consolidated Statements of Cash Flows | $ 867.7 | $ 966.6 | $ 889 | $ 1,045.8 |