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Xilinx Reports Third Quarter Fiscal Year 2021 Results

  • Revenues of $803 million exceeded the high end of guidance, representing 5% sequential and 11% year over year growth
  • Wired and Wireless Group (WWG) revenue increased 14% sequentially due to strength in the Wireless markets as 5G deployments ramped in multiple regions
  • Automotive, Broadcast & Consumer (ABC) revenue increased 27% sequentially, driven by record quarters in the Automotive and Broadcast end markets
  • Aerospace & Defense, Industrial and Test, Measurement & Emulation (AIT) revenue increased 7% sequentially, driven by strong performance in the Test, Measurement and Emulation market
  • Data Center Group (DCG) revenue declined 45% sequentially, in line with expectations, compared to a record second quarter which benefited from trade-related order acceleration
  • Free cash flow of $354 million, representing 44% of revenue
  • Returned $93 million to stockholders through dividends

 

SAN JOSE, Calif.–(BUSINESS WIRE)–Xilinx, Inc. (Nasdaq: XLNX), the leader in adaptive computing, today announced revenues of $803 million for the third quarter of fiscal year 2021.

GAAP net income for the quarter was $171 million, or $0.69 per diluted share. Non-GAAP net income was $194 million, or $0.78 per diluted share.

Additional third quarter of fiscal year 2021 comparisons are provided in the charts below.

Q3 Fiscal 2021 Financial Highlights

(In millions, except EPS)

 

GAAP

 

 

 

 

 

 

 

 

Q3

Q2

Q3

 

 

 

 

FY2021

FY2021

FY2020

 

Q-T-Q

Y-T-Y

Net revenues*

$803

$767

$723

 

5%

11%

Gross margin

$547

$542

$483

 

1%

13%

Operating income

$172

$205

$159

 

-16%

8%

Net income

$171

$194

$162

 

-12%

6%

Diluted earnings per share

$0.69

$0.79

$0.64

 

-13%

8%

 

 

 

 

 

 

 

 

Non-GAAP

 

 

 

 

 

 

 

 

Q3

Q2

Q3

 

 

 

 

FY2021

FY2021

FY2020

 

Q-T-Q

Y-T-Y

Net revenues*

$803

$767

$723

 

5%

11%

Gross margin

$554

$548

$492

 

1%

13%

Operating income

$201

$216

$174

 

-7%

16%

Net income

$194

$203

$171

 

-5%

14%

Diluted earnings per share

$0.78

$0.82

$0.68

 

-5%

15%

 

 

* No adjustment between GAAP and Non-GAAP

Third quarter revenues exceeded the high end of our guidance, delivering both sequential and annual growth, demonstrating strengthening business conditions and solid execution,” said Victor Peng, Xilinx president and CEO. “Our Wired and Wireless Group performed better than expected as 5G deployments ramped more meaningfully in North America. We achieved a record quarter in Automotive, Broadcast and Consumer end markets, driven by the ongoing economic recovery, as demand for automobiles strengthened and live media events returned. In addition, as expected, our first 7nm Versal ACAP has gone into production with a leading wireless OEM. We are excited to see the Versal product portfolio begin to contribute to Xilinx’s long-term growth.”

Our investments continue to deliver strong returns, with our Advanced Products growing 8% sequentially and representing 72% of total revenue,” said Brice Hill, Xilinx CFO. “We continue to drive our transformation to a platform company as demonstrated by our Zynq platform product revenue growing 24% sequentially, making up 27% of total revenue during the quarter. Our efficient financial model generated significant free cash flow of $354 million, or 44% of Q3 revenue.”

Net Revenues by Geography:

 

 

 

 

 

 

Percentages

Growth Rates

 

Q3

Q2

Q3

 

 

 

FY2021

FY2021

FY2020

Q-T-Q

Y-T-Y

North America

30%

29%

28%

6%

16%

Asia Pacific

44%

48%

48%

-3%

4%

Europe

19%

18%

16%

12%

28%

Japan

7%

5%

8%

44%

2%

 

 

 

 

 

 

Net Revenues by End Market:

 

 

 

 

 

 

Percentages

Growth Rates

 

Q3

Q2

Q3

 

 

 

FY2021

FY2021

FY2020

Q-T-Q

Y-T-Y

A&D, Industrial and TME

45%

44%

40%

7%

25%

Automotive, Broadcast and Consumer

19%

16%

19%

27%

14%

Wired and Wireless Group

29%

26%

31%

14%

2%

Data Center Group

7%

14%

9%

-45%

-15%

Channel

0%

0%

1%

NM

NM

 

 

 

 

 

 

Net Revenues by Product:

 

 

 

 

 

 

Percentages

Growth Rates

 

Q3

Q2

Q3

 

 

 

FY2021

FY2021

FY2020

Q-T-Q

Y-T-Y

Advanced Products

72%

70%

70%

8%

15%

Core Products

28%

30%

30%

-3%

1%

Products are classified as follows:

Advanced Products: Alveo and related products, UltraScale+, UltraScale and 7-series products.

Core Products: Virtex-6, Spartan-6, Virtex‐5, CoolRunner‐II, Virtex-4, Virtex-II, Spartan-3, Spartan-2, XC9500 products, configuration solutions, software & support/services.

Key Statistics:

(Dollars in Millions)

 

 

Q3

 

Q2

 

Q3

 

FY2021

 

FY2021

 

FY2020

 

 

 

 

 

 

Operating Cash Flow

$360

 

$248

 

$324

Depreciation Expense (including software amortization)

$31

 

$30

 

$26

Capital Expenditures (including software)

$6

 

$15

 

$34

Free Cash Flow (1)

$354

 

$232

 

$289

Inventory Days (internal)

115

 

114

 

124

Revenue Turns (%)

34

 

38

 

39

(1) Free Cash Flow = Operating Cash Flow – Capital Expenditures (including software)

Product and Financial Highlights – Fiscal Third Quarter 2021

  • Advanced Products represented 72% of total revenue, an 8% increase quarter over quarter and a 15% increase year over year. Zynq platform revenue grew 24% sequentially and 29% year over year, representing 27% of the total revenue. The sequential strength was driven by improvement in the Automotive and Broadcast end markets and the ramp of 5G in the Wireless end market.
  • Xilinx shipped its first production 7nm Versal ACAP parts to a leading wireless OEM, enabling the advanced signal processing performance and adaptability needed to deliver the next-generation 5G technologies like beamforming. Xilinx continues to make progress on broadening the Versal portfolio with additional Versal products in late-stage development.
  • Xilinx introduced Zynq RFSoC DFE, which combines hardened digital front-end (DFE) blocks and adaptable logic to build high-performance, low-power, and cost-effective 5G NR radio solutions for a broad array of use cases, ranging across low, mid and high-band spectrum.
  • Xilinx announced a collaboration with Texas Instruments to develop scalable and adaptable DFE solutions to increase energy efficiency of lower antenna count radios.
  • Xilinx and Samsung announced the availability of the Samsung SmartSSD Computational Storage Drive (CSD). Powered by Xilinx’s FPGAs, the SmartSSD CSD provides the performance, customization, and scalability required by data-intensive applications.
  • Xilinx announced the acquisition of Falcon Computing Solutions, Inc., a leading provider of high-level synthesis compiler optimization technology for hardware acceleration of software applications.

Commentary on AMD Transaction

As announced on October 27, 2020, Advanced Micro Devices, Inc. (AMD) intends to acquire Xilinx in an all-stock transaction valued at $35 billion. The combination enhances AMD’s leadership position in high performance computing, significantly expanding the breadth of AMD’s product portfolio and customer set across diverse growth markets where Xilinx is an established leader. Due to the pending acquisition, Xilinx will not hold an earnings conference call or provide forward-looking guidance. Also, pursuant to the terms of the Merger Agreement between the Company and AMD, Xilinx will suspend declaration and distribution of its quarterly dividend as well as its open market stock repurchase program.

Non-GAAP Financial Information

Fiscal third quarter 2021 results include financial measures which are not determined in accordance with the United States generally accepted accounting principles (GAAP), as indicated. Non-GAAP measures should not be considered as a substitute for, or superior to, financial measures determined in accordance with GAAP. The presentation of non-GAAP financial measures has been reconciled, in each case, to the most directly comparable GAAP measure, as indicated in the accompanying tables. Xilinx’s (the Company) calculation of such non-GAAP measures may not be comparable to similarly-titled measures used by other companies.

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

M&A related expenses: These expenses mainly consist of legal, advisory and consulting fees associated with acquisition activities, and also include fees and retention compensation related to the Company’s acquisition by AMD. The Company believes these costs do not reflect its current operating performance.

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

Income taxes: The Company excludes the income tax effects of non-GAAP adjustments reflected in operating expenses and other income, as detailed above. It also excludes other significant tax effects of post-acquisition tax integration transactions. The Company believes excluding post-acquisition tax integration items will facilitate a comparable evaluation of its current performance to its past performance.

In addition, free cash flow, which is cash flow from operations adjusted to exclude additions to software, property, plant, and equipment, is used by management when assessing the Company’s sources of liquidity, capital resources, and quality of earnings. The Company believes that this non-GAAP financial measure is helpful in understanding the Company’s capital requirements and provides an additional means to evaluate the cash flow trends of the Company’s business.

Forward-Looking Statements

This release contains forward-looking statements, which can often be identified by the use of forward-looking words such as “expect,” “believe,” “may,” “will,” “could,” “anticipate,” “estimate,” “continue,” “plan,” “intend,” “project” or other similar expressions. Statements that refer to or are based on uncertain events or assumptions also identify forward-looking statements. Such forward-looking statements include, but are not limited to, statements related to our proposed acquisition by AMD, the semiconductor market, the growth and acceptance of our products, expected revenue growth, the demand and growth in the markets we serve, and opportunity for expansion into new markets. Undue reliance should not be placed on such forward-looking statements, which speak only as of the date they are made. We undertake no obligation to update such forward-looking statements. Actual events and results may differ materially from those in the forward-looking statements and are subject to risks and uncertainties, including, among others, the impact of the ongoing COVID-19 pandemic and related mitigation measures (which, in addition to presenting its own risks and uncertainties, may also heighten the other risks and uncertainties faced by our business and decrease our visibility into all aspects of our business); closing of the proposed transaction with AMD on anticipated timing (including the risk that the conditions to the transaction are not satisfied on a timely basis or at all or the failure of the transaction to close for any other reason) and terms (including obtaining the anticipated tax treatment, regulatory approvals, required consents or authorizations); unanticipated difficulties or expenditures relating to the transaction; the response of business partners and retention as a result of the announcement and pendency of the transaction; the diversion of management time on transaction-related matters; customer acceptance of our new products; changing global economic conditions; our dependence on certain customers; trade and export restrictions; the condition and performance of our customers and the end markets in which they participate; our ability to forecast end customer demand; a high dependence on turns business; more customer volume discounts than expected; greater product mix changes than anticipated; fluctuations in manufacturing yields; our ability to deliver product in a timely manner; our ability to successfully manage production at multiple foundries; our reliance on third parties (including distributors); variability in wafer pricing; costs and liabilities associated with current and future litigation (including litigation relating to the proposed transaction with AMD); our ability to generate cost and operating expense savings in an efficient and timely manner; our ability to realize the goals contemplated by our acquisitions and strategic investments; the impact of current and future legislative and regulatory changes; the impact of new accounting pronouncements and tax laws, including the U.S. Tax Cuts and Jobs Act, and interpretations thereof; and other risk factors described in our most recent Forms 10-Q and 10-K and subsequent filings with the U.S. Securities and Exchange Commission.

About Xilinx

Xilinx, Inc. develops highly flexible and adaptive computing platforms that enable rapid innovation across a variety of technologies – from the cloud, to the edge, to the endpoint. Xilinx is the inventor of the FPGA and Adaptive SoCs (including our Adaptive Compute Acceleration Platform, or ACAP), designed to deliver the most dynamic computing technology in the industry. We collaborate with our customers to create scalable, differentiated and intelligent solutions that enable the adaptable, intelligent and connected world of the future. For more information, visit xilinx.com.

Xilinx, the Xilinx logo, Alveo, Artix, Kintex, Spartan, Versal, Vitis, Virtex, Vivado, Zynq, and other designated brands included herein are trademarks of Xilinx in the United States and/or other countries. All other trademarks are the property of their respective owners.

XLNX-F

XILINX, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In thousands, except per share amounts)
 

Three Months Ended

 

Nine Months Ended

 
 

January 2, 2021

 

September 26, 2020

 

December 28, 2019

 

January 2, 2021

 

December 28, 2019

 
Net revenues  

$

803,404

 

$

766,535

 

 

$

723,499

 

$

2,296,612

 

 

$

2,406,497

 
Cost of revenues:            
Cost of products sold  

 

249,529

 

 

218,120

 

 

 

233,324

 

 

693,753

 

 

 

804,197

 
Amortization of acquisition-related intangibles  

 

6,875

 

 

6,696

 

 

 

6,697

 

 

20,268

 

 

 

15,699

 
Total cost of revenues  

 

256,404

 

 

224,816

 

 

 

240,021

 

 

714,021

 

 

 

819,896

 
Gross margin  

 

547,000

 

 

541,719

 

 

 

483,478

 

 

1,582,591

 

 

 

1,586,601

 
Operating expenses:                      
Research and development  

 

235,018

 

 

219,647

 

 

 

211,541

 

 

664,776

 

 

 

638,621

 
Selling, general and administrative  

 

136,701

 

 

113,793

 

 

 

109,612

 

 

355,877

 

 

 

328,633

 
Amortization of acquisition-related intangibles  

 

2,856

 

 

2,862

 

 

 

2,919

 

 

8,581

 

 

 

5,488

 
Total operating expenses  

 

374,575

 

 

336,302

 

 

 

324,072

 

 

1,029,234

 

 

 

972,742

 
Operating income  

 

172,425

 

 

205,417

 

 

 

159,406

 

 

553,357

 

 

 

613,859

 
Interest and other income (expense), net  

 

3,709

 

 

(10,771

)

 

 

6,437

 

 

(19,215

)

 

 

30,378

 
Income before income taxes  

 

176,134

 

 

194,646

 

 

 

165,843

 

 

534,142

 

 

 

644,237

 
Provision for income taxes  

 

5,162

 

 

830

 

 

 

3,831

 

 

75,517

 

 

 

13,774

 
Net income  

$

170,972

 

$

193,816

 

 

$

162,012

 

$

458,625

 

 

$

630,463

 
Net income per common share:                      
Basic  

$

0.70

 

$

0.79

 

 

$

0.65

 

$

1.88

 

 

$

2.50

 
Diluted  

$

0.69

 

$

0.79

 

 

$

0.64

 

$

1.86

 

 

$

2.47

 
Cash dividends per common share  

$

0.38

 

$

0.38

 

 

$

0.37

 

$

1.14

 

 

$

1.11

 
Shares used in per share calculations:                      
Basic  

 

245,145

 

 

244,837

 

 

 

250,546

 

 

243,976

 

 

 

252,330

 
Diluted  

 

248,148

 

 

246,763

 

 

 

252,808

 

 

246,786

 

 

 

255,758

 

 

XILINX, INC.

 
CONDENSED CONSOLIDATED BALANCE SHEETS  
(In thousands)  
January 2, 2021   March 28, 2020*
(unaudited)  
ASSETS  
Current assets:  
Cash, cash equivalents and short-term investments

$

3,324,425

 

$

2,267,216

Accounts receivable, net

 

269,605

 

 

273,028

Inventories

 

300,107

 

 

304,340

Other current assets

 

73,112

 

 

64,557

Total current assets

 

3,967,249

 

 

2,909,141

Net property, plant and equipment

 

351,513

 

 

372,574

Other assets

 

1,430,203

 

 

1,411,619

Total Assets

$

5,748,965

 

$

4,693,334

   
   
LIABILITIES AND STOCKHOLDERS’ EQUITY  
Current liabilities:  
Accounts payable and accrued liabilities

$

614,227

 

$

586,421

Current portion of long-term debt

 

499,865

 

 

499,260

Total current liabilities

 

1,114,092

 

 

1,085,681

Long-term debt

 

1,492,377

 

 

747,110

Other long-term liabilities

 

543,605

 

 

545,494

Stockholders’ equity

 

2,598,891

 

 

2,315,049

Total Liabilities and Stockholders’ Equity

$

5,748,965

 

$

4,693,334

   
* Fiscal 2020 balances are derived from audited financial statements.
XILINX, INC.  
SUPPLEMENTAL FINANCIAL INFORMATION  
(Unaudited)
(In thousands)

Three Months Ended

 

Nine Months Ended

 

January 2, 2021

 

September 26, 2020

 

December 28, 2019

 

January 2, 2021

 

December 28, 2019

 
SELECTED CASH FLOW INFORMATION:          
Depreciation and amortization of software

$

30,818

 

$

30,249

 

$

26,331

 

$

92,816

 

$

68,882

 
Amortization – others

 

17,133

 

 

15,316

 

 

15,276

 

 

47,508

 

 

37,326

 
Stock-based compensation

 

66,331

 

 

58,439

 

 

50,157

 

 

175,153

 

 

142,732

 
Net cash provided by operating activities

 

360,137

 

 

247,583

 

 

323,575

 

 

853,191

 

 

845,485

 
Purchases of property, plant and equipment and software

 

6,009

 

 

15,331

 

 

34,138

 

 

36,801

 

 

96,980

 
Payment of dividends to stockholders

 

93,155

 

 

93,105

 

 

92,931

 

 

278,674

 

 

280,376

 
Repurchases of common stock

 

 

 

 

 

260,939

 

 

53,682

 

 

738,184

 
Taxes paid related to net share settlement of restricted stock units, net of proceeds from issuance of common stock

 

4,560

 

 

30,072

 

 

3,565

 

 

37,871

 

 

55,541

 
           
           
STOCK-BASED COMPENSATION INCLUDED IN:          
Cost of revenues

$

3,465

 

$

2,963

 

$

2,961

 

$

9,149

 

$

8,386

 
Research and development

 

40,228

 

 

36,110

 

 

31,543

 

 

106,707

 

 

86,119

 
Selling, general and administrative

 

22,638

 

 

19,366

 

 

15,653

 

 

59,297

 

 

48,227

 
XILINX, INC.
RECONCILIATIONS OF GAAP ACTUALS TO NON-GAAP ACTUALS
(Unaudited)
(In thousands, except per share amounts)
Three Months Ended Nine Months Ended

January 2, 2021

September 26, 2020 December 28, 2019 January 2, 2021 December 28, 2019
GAAP gross margin

$

547,000

 

$

541,719

 

$

483,478

 

$

1,582,591

 

$

1,586,601

 

Inventory valuation adjustment

 

 

 

 

 

2,114

 

 

 

 

3,856

 

Amortization of acquisition-related intangibles

 

6,875

 

 

6,696

 

 

6,697

 

 

20,268

 

 

15,699

 

M&A related expenses

 

114

 

 

 

 

 

 

114

 

 

 

Non-GAAP gross margin

$

553,989

 

$

548,415

 

$

492,289

 

$

1,602,973

 

$

1,606,156

 

 
GAAP operating income

$

172,425

 

$

205,417

 

$

159,406

 

$

553,357

 

$

613,859

 

Inventory valuation adjustment

 

 

 

 

 

2,114

 

 

 

 

3,856

 

Amortization of acquisition-related intangibles

 

9,731

 

 

9,558

 

 

9,616

 

 

28,849

 

 

21,187

 

M&A related expenses

 

19,150

 

 

1,506

 

 

3,042

 

 

22,219

 

 

12,393

 

Non-GAAP operating income

$

201,306

 

$

216,481

 

$

174,178

 

$

604,425

 

$

651,295

 

 
GAAP net income

$

170,972

 

$

193,816

 

$

162,012

 

$

458,625

 

$

630,463

 

Inventory valuation adjustment

 

 

 

 

 

2,114

 

 

 

 

3,856

 

Amortization of acquisition-related intangibles

 

9,731

 

 

9,558

 

 

9,616

 

 

28,849

 

 

21,187

 

M&A related expenses

 

19,150

 

 

1,506

 

 

3,042

 

 

22,219

 

 

12,393

 

Income tax effect of tax-related items

 

(528

)

 

 

 

(3,697

)

 

56,273

 

 

(1,838

)

Income tax effect of non-GAAP adjustments

 

(5,100

)

 

(1,470

)

 

(2,316

)

 

(8,160

)

 

(6,133

)

Non-GAAP net income

$

194,225

 

$

203,410

 

$

170,771

 

$

557,806

 

$

659,928

 

 
GAAP diluted EPS

$

0.69

 

$

0.79

 

$

0.64

 

$

1.86

 

$

2.47

 

Inventory valuation adjustment

 

 

 

 

 

0.01

 

 

 

 

0.01

 

Amortization of acquisition-related intangibles

 

0.04

 

 

0.03

 

 

0.04

 

 

0.12

 

 

0.08

 

M&A related expenses

 

0.07

 

 

0.01

 

 

0.01

 

 

0.08

 

 

0.05

 

Income tax effect of tax-related items

 

 

 

 

 

(0.01

)

 

0.23

 

 

(0.01

)

Income tax effect of non-GAAP adjustments

 

(0.02

)

 

(0.01

)

 

(0.01

)

 

(0.03

)

 

(0.02

)

Non-GAAP diluted EPS

$

0.78

 

$

0.82

 

$

0.68

 

$

2.26

 

$

2.58

 

 
GAAP cash flow from operations

$

360,137

 

$

247,583

 

$

323,575

 

$

853,191

 

$

845,485

 

Capital expenditures (including software)

 

(6,009

)

 

(15,331

)

 

(34,138

)

 

(36,801

)

 

(96,980

)

Free cash flow

$

354,128

 

$

232,252

 

$

289,437

 

$

816,390

 

$

748,505

 

 

Source: Xilinx Newsroom

Category: Corporate Announcements

Contacts

Investor Relations Contact:
Suresh Bhaskaran

Xilinx, Inc.

(408) 879-4784

ir@xilinx.com

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