Applied Materials Announces Second Quarter Results
(Thomson Reuters ONE) -
* Second consecutive quarter with more than $2 billion in new orders
* Net sales of $1.97 billion up 25 percent sequentially
* Non-GAAP adjusted EPS of 16 cents exceeded high end of outlook; GAAP loss of
11 cents per share reflected impairment charges in Energy and Environmental
Solutions
SANTA CLARA, Calif., May 16, 2013 - Applied Materials, Inc. (NASDAQ:AMAT), the
global leader in manufacturing solutions for the semiconductor, display and
solar industries, today reported results for its second quarter of fiscal 2013
ended April 28, 2013.
Applied generated orders of $2.27 billion, up 7 percent from the prior quarter,
with Silicon Systems Group orders up 14 percent from the first quarter and
Display orders up 41 percent sequentially. Net sales were $1.97 billion, up 25
percent sequentially.
Applied reported non-GAAP adjusted operating income of $285 million and non-GAAP
adjusted net income of $199 million or 16 cents per diluted share. The company
recorded a GAAP operating loss of $68 million and a GAAP net loss of $129
million or 11 cents per diluted share. The GAAP net loss included $278 million
in goodwill and intangible asset impairment charges associated with the Energy
and Environmental Solutions (EES) segment, which were primarily the result of
the further deterioration in solar equipment market conditions, along with $10
million in charges related to previously announced restructuring plans. The
company continues to aggressively reduce spending in the EES segment.
"For the second quarter in a row, Applied had strong order performance of over
$2 billion," said Mike Splinter, chairman and chief executive officer. "We are
seeing increasing pull from some of our largest strategic customers for our key
enabling technologies. We remain committed to driving profitable growth."
Quarterly Results Summary
GAAP Results Q2 FY2013 Q1 FY2013 Q2 FY2012
------------------------------- ---------------- --------------- --------------
Net sales $1.97 billion $1.57 billion $2.54 billion
Operating income (loss) $(68) million $39 million $409 million
Net income (loss) $(129) million $34 million $289 million
Diluted earnings (loss) per
share (EPS) $(0.11) $0.03 $0.22
Non-GAAP Adjusted Results
-------------------------------
Non-GAAP adjusted operating
income $285 million $112 million $490 million
Non-GAAP adjusted net income $199 million $69 million $349 million
Non-GAAP adjusted diluted EPS $0.16 $0.06 $0.27
Applied's non-GAAP adjusted results exclude the impact of the following, where
applicable: certain discrete tax items; restructuring charges and any associated
adjustments; certain acquisition-related costs; and impairments of assets,
goodwill, or investments. A reconciliation of the GAAP and non-GAAP adjusted
results is provided in the financial tables included in this release. See also
"Use of Non-GAAP Adjusted Financial Measures" below.
Second Quarter Reportable Segment Results and Comparisons to the Prior Quarter
Silicon Systems Group (SSG) orders were $1.55 billion, up 14 percent, with
growth primarily driven by memory. Net sales were $1.29 billion, up 33 percent,
led by foundry. Non-GAAP adjusted operating income increased to $329 million or
25.5 percent of net sales. GAAP operating income increased to $283 million or
21.9 percent of net sales. New order composition was: foundry 66 percent;
logic/other 13 percent; flash 11 percent; and DRAM 10 percent.
Applied Global Services (AGS) orders were $481 million, down 12 percent
primarily due to the timing of service contract renewals which are typically
concentrated in the first fiscal quarter. Net sales were $517 million, up 10
percent. Non-GAAP adjusted operating income increased to $120 million and rose
by 3.9 points to 23.2 percent of net sales. GAAP operating income increased to
$118 million or 22.8 percent of net sales.
Display orders were $195 million, up 41 percent driven by the initial recovery
in TV equipment investment. Net sales were $127 million, up 46 percent. Non-GAAP
adjusted operating income increased to $21 million or 16.5 percent of net sales.
GAAP operating income increased to $19 million or 15.0 percent of net sales.
Energy and Environmental Solutions (EES) orders were $39 million, down 43
percent. Net sales were $38 million, down 17 percent. EES had a non-GAAP
adjusted operating loss of $34 million; EES recorded a GAAP operating loss of
$322 million, which included impairment charges of $278 million.
Additional Quarterly Financial Information
* Backlog increased by 9 percent sequentially to $2.30 billion including
negative adjustments of $102 million.
* Gross margin was 43.2 percent on a non-GAAP adjusted basis, up from 39.8
percent in the prior quarter reflecting higher net sales and lower inventory
charges. GAAP gross margin was 41.0 percent.
* RD&E increased by $40 million or 13 percent sequentially. On a year-over-
year basis, RD&E as a proportion of RD&E plus SG&A increased by 5 points to
59 percent, reflecting the impact of structural changes aimed at funding
growth initiatives.
* The effective tax rate was 24.9 percent on a non-GAAP adjusted basis. The
GAAP effective tax rate was (43.3) percent, reflecting the effects of the
goodwill impairment charge, which were not deductible.
* The company paid $108 million in cash dividends and used $100 million to
repurchase 8 million shares of its common stock.
* Cash, cash equivalents and investments ended the quarter at $2.85 billion,
up slightly from the prior quarter.
Business Outlook
For the third quarter of fiscal 2013, Applied expects net sales to be up
slightly from the previous quarter. The company expects non-GAAP adjusted EPS to
be in the range of $0.16 to $0.20. The non-GAAP adjusted EPS outlook excludes
known charges related to completed acquisitions of approximately $0.04 per share
but does not exclude other non-GAAP adjustments that may arise subsequent to
this release.
Use of Non-GAAP Adjusted Financial Measures
Management uses non-GAAP adjusted results to evaluate the company's operating
and financial performance in light of business objectives and for planning
purposes. These measures are not in accordance with GAAP and may differ from
non-GAAP methods of accounting and reporting used by other companies. Applied
believes these measures enhance investors' ability to review the company's
business from the same perspective as the company's management and facilitate
comparisons of this period's results with prior periods. The presentation of
this additional information should not be considered a substitute for results
prepared in accordance with GAAP.
Webcast Information
Applied Materials will discuss these results during an earnings call that begins
at 1:30 p.m. Pacific Time today. A live webcast will be available at
www.appliedmaterials.com. A replay will be available on the website beginning at
5:00 p.m. Pacific Time today.
Forward-Looking Statements
This press release contains forward-looking statements, including statements
regarding Applied's performance, customer demand, industry conditions, market
outlooks, and business outlooks for the third quarter of fiscal 2013, as well as
the assumptions that underlie such statements. These statements are subject to
known and unknown risks and uncertainties that could cause actual results to
differ materially from those expressed or implied by such statements, including
but not limited to: the level of demand for Applied's products, which is subject
to many factors, including uncertain global economic and industry conditions,
end-demand for electronic products and semiconductors, and customers' new
technology and capacity requirements; variability of operating expenses and
results among the company's segments caused by differing conditions in the
served markets; the concentrated nature of Applied's customer base; Applied's
ability to (i) develop, deliver and support a broad range of products, expand
its markets and develop new markets, (ii) timely align its cost structure with
business conditions and achieve the intended objectives of cost-reduction
activities, (iii) plan and manage its resources and production capability,
(iv) obtain and protect intellectual property rights in key technologies,
(v) attract, motivate and retain key employees, and (vi) accurately forecast
future results, which depends on multiple assumptions related to, without
limitation, market conditions, customer requirements and business needs; and
other risks described in Applied's SEC filings, including its most recent Form
10-Q. All forward-looking statements are based on management's estimates,
projections and assumptions as of the date hereof. The company undertakes no
obligation to update any forward-looking statements.
About Applied Materials
Applied Materials, Inc. (Nasdaq:AMAT) is the global leader in providing
innovative equipment, services and software to enable the manufacture of
advanced semiconductor, flat panel display and solar photovoltaic products. Our
technologies help make innovations like smartphones, flat screen TVs and solar
panels more affordable and accessible to consumers and businesses around the
world. Learn more at www.appliedmaterials.com.
Contact:
Kevin Winston (editorial/media) 408.235.4498
Michael Sullivan (financial community) 408.986.7977
APPLIED MATERIALS, INC.
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
Three Months Ended Six Months Ended
------------------------------------- ----------------------
(In millions,
except per share April 28, January 27, April 29, April 28, April 29,
amounts) 2013 2013 2012 2013 2012
----------- ------------- ----------- ----------- ----------
Net sales $ 1,973 $ 1,573 $ 2,541 $ 3,546 $ 4,730
Cost of products
sold 1,165 991 1,530 2,156 2,933
----------- ------------- ----------- ----------- ----------
Gross margin 808 582 1,011 1,390 1,797
Operating
expenses:
Research,
development
and
engineering 344 304 321 648 625
Selling,
general and
administrative 244 230 281 474 584
Impairment of
goodwill and
intangible
assets 278 - - 278 -
Restructuring
charges and
asset
impairments 10 9 - 19 -
----------- ------------- ----------- ----------- ----------
Total operating
expenses 876 543 602 1,419 1,209
Income (loss)
from operations (68 ) 39 409 (29 ) 588
Impairments of
strategic
investments 2 - 3 2 3
Interest and
other expenses 24 24 23 48 47
Interest and
other income,
net 4 3 4 7 8
----------- ------------- ----------- ----------- ----------
Income (loss)
before income
taxes (90 ) 18 387 (72 ) 546
Provision
(benefit) for
income taxes 39 (16 ) 98 23 140
----------- ------------- ----------- ----------- ----------
Net income
(loss) $ (129 ) $ 34 $ 289 $ (95 ) $ 406
----------- ------------- ----------- ----------- ----------
Earnings (loss)
per share:
Basic and
diluted $ (0.11 ) $ 0.03 $ 0.22 $ (0.08 ) $ 0.31
Weighted average
number of
shares:
Basic 1,203 1,198 1,289 1,200 1,294
1,203 1,212 1,301 1,200 1,305
Diluted
APPLIED MATERIALS, INC.
UNAUDITED CONSOLIDATED CONDENSED BALANCE SHEETS
April 28, January 27, October 28,
(In millions) 2013 2013 2012
------------ ------------- ------------
ASSETS
Current assets:
Cash and cash equivalents $ 1,545 $ 1,523 $ 1,392
Short-term investments 225 230 545
Accounts receivable, net 1,275 1,109 1,220
Inventories 1,318 1,278 1,272
Other current assets 750 625 673
------------ ------------- ------------
Total current assets 5,113 4,765 5,102
Long-term investments 1,080 1,062 1,055
Property, plant and equipment, net 886 900 910
Goodwill 3,294 3,518 3,518
Purchased technology and other
intangible assets, net 1,194 1,302 1,355
Deferred income taxes and other
assets 128 167 162
------------ ------------- ------------
Total assets $ 11,695 $ 11,714 $ 12,102
------------ ------------- ------------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued
expenses $ 1,462 $ 1,287 $ 1,510
Customer deposits and deferred
revenue 739 678 755
------------ ------------- ------------
Total current liabilities 2,201 1,965 2,265
Long-term debt 1,946 1,946 1,946
Other liabilities 650 662 656
------------ ------------- ------------
Total liabilities 4,797 4,573 4,867
------------ ------------- ------------
Total stockholders' equity 6,898 7,141 7,235
------------ ------------- ------------
Total liabilities and stockholders'
equity $ 11,695 $ 11,714 $ 12,102
------------ ------------- ------------
APPLIED MATERIALS, INC.
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
Three Months Ended Six Months Ended
------------------------------------- ----------------------
April 28, January 27, April 29, April 28, April 29,
(In millions) 2013 2013 2012 2013 2012
----------- ------------- ----------- ----------- ----------
Cash flows from
operating
activities:
Net income
(loss) $ (129 ) $ 34 $ 289 $ (95 ) $ 406
Adjustments
required to
reconcile net
income (loss) to
cash provided by
operating
activities:
Depreciation
and
amortization 106 106 108 212 220
Impairment of
goodwill and
intangible
assets 278 - - 278 -
Restructuring
charges and
asset
impairments 10 9 - 19 -
Deferred
income taxes
and other 32 (78 ) 14 (46 ) 53
Share-based
compensation 39 42 43 81 96
Net change in
operating
assets and
liabilities,
net of amounts
acquired (112 ) (97 ) 149 (209 ) 9
----------- ------------- ----------- ----------- ----------
Cash provided by
operating
activities 224 16 603 240 784
----------- ------------- ----------- ----------- ----------
Cash flows from
investing
activities:
Capital
expenditures (51 ) (49 ) (39 ) (100 ) (76 )
Cash paid for
acquisition, net
of cash acquired (1 ) - (7 ) (1 ) (4,186 )
Proceeds from
sales and
maturities of
investments 158 445 247 603 560
Purchases of
investments (167 ) (143 ) (460 ) (310 ) (714 )
----------- ------------- ----------- ----------- ----------
Cash provided by
(used in)
investing
activities (61 ) 253 (259 ) 192 (4,416 )
----------- ------------- ----------- ----------- ----------
Cash flows from
financing
activities:
Proceeds from
common stock
issuances 67 18 43 85 45
Common stock
repurchases (100 ) (48 ) (200 ) (148 ) (400 )
Payments of
dividends to
stockholders (108 ) (108 ) (104 ) (216 ) (208 )
----------- ------------- ----------- ----------- ----------
Cash used in
financing
activities (141 ) (138 ) (261 ) (279 ) (563 )
----------- ------------- ----------- ----------- ----------
Effect of exchange
rate changes on
cash and cash
equivalents - - (3 ) - (4 )
----------- ------------- ----------- ----------- ----------
Increase
(decrease) in cash
and cash
equivalents 22 131 80 153 (4,199 )
Cash and cash
equivalents -
beginning of
period 1,523 1,392 1,681 1,392 5,960
----------- ------------- ----------- ----------- ----------
Cash and cash
equivalents - end
of period $ 1,545 $ 1,523 $ 1,761 $ 1,545 $ 1,761
----------- ------------- ----------- ----------- ----------
Supplemental cash
flow information:
Cash payments
for income taxes $ 122 $ 32 $ 146 $ 154 $ 179
Cash refunds
from income
taxes $ 2 $ 65 $ 1 $ 67 $ 4
Cash payments $ 7 $ 39 $ 7 $ 46 $ 48
for interest
APPLIED MATERIALS, INC.
UNAUDITED SUPPLEMENTAL INFORMATION
Reportable Segment Results
Q2 FY2013 Q1 FY2013 Q2 FY2012
------------------------------- ------------------------------- ------------------------------
Operating Operating Operating
(In New Net Income New Net Income New Net Income
millions) Orders Sales (Loss) Orders Sales (Loss) Orders Sales (Loss)
--------- --------- ----------- --------- --------- ----------- --------- --------- ----------
SSG $ 1,551 $ 1,291 $ 283 $ 1,363 $ 969 $ 134 $ 1,969 $ 1,777 $ 504
AGS 481 517 118 544 471 89 650 551 109
Display 195 127 19 138 87 3 84 134 7
EES* 39 38 (322 ) 68 46 (54 ) 62 79 (63 )
Corporate - - (166 ) - - (133 ) - - (148 )
--------- --------- ----------- --------- --------- ----------- --------- --------- ----------
Consolidated $ 2,266 $ 1,973 $ (68 ) $ 2,113 $ 1,573 $ 39 $ 2,765 $ 2,541 $ 409
--------- --------- ----------- --------- --------- ----------- --------- --------- ----------
* Operating loss for the second quarter of fiscal 2013 includes $278 million in
goodwill and intangible asset impairment charges
Corporate Unallocated Expenses
Q2 Q1 Q2
(In millions) FY2013 FY2013 FY2012
--------- --------- --------
Restructuring charges and asset impairments, net $ 4 $ 4 $ -
Share-based compensation 39 42 43
Other unallocated expenses 123 87 105
--------- --------- --------
Corporate $ 166 $ 133 $ 148
--------- --------- --------
APPLIED MATERIALS, INC.
UNAUDITED SUPPLEMENTAL INFORMATION
Additional Information
Q2 FY2013 Q1 FY2013 Q2 FY2012
---------------- ---------------- ---------------
New Orders and Net Sales by
Geography
New Net New Net New Net
(In $ millions) Orders Sales Orders Sales Orders Sales
-------- ------- -------- ------- -------- ------
United States 398 362 391 401 673 518
% of Total 18 % 18 % 19 % 25 % 24 % 20 %
Europe 173 144 134 119 271 229
% of Total 8 % 7 % 6 % 8 % 10 % 9 %
Japan 191 157 181 98 121 169
% of Total 8 % 8 % 9 % 6 % 4 % 7 %
Korea 259 226 198 205 704 750
% of Total 11 % 12 % 9 % 13 % 26 % 30 %
Taiwan 902 828 906 565 810 654
% of Total 40 % 42 % 43 % 36 % 29 % 26 %
Southeast Asia 67 73 65 58 68 64
% of Total 3 % 4 % 3 % 4 % 3 % 2 %
China 276 183 238 127 118 157
% of Total 12 % 9 % 11 % 8 % 4 % 6 %
Employees (In thousands)
Regular Full Time 13.6 13.7 14.6
APPLIED MATERIALS, INC.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ADJUSTED RESULTS
Three Months Ended Six Months Ended
------------------------------------- ----------------------
(In millions,
except April 28, January 27, April 29, April 28, April 29,
percentages) 2013 2013 2012 2013 2012
----------- ------------- ----------- ----------- ----------
Non-GAAP
Adjusted Gross
Margin
Reported gross
margin (GAAP
basis) $ 808 $ 582 $ 1,011 $ 1,390 $ 1,797
Certain items
associated with
acquisitions(1) 43 43 59 86 163
Acquisition
integration and
deal costs 1 1 - 2 -
----------- ------------- ----------- ----------- ----------
Non-GAAP
adjusted gross
margin $ 852 $ 626 $ 1,070 $ 1,478 $ 1,960
----------- ------------- ----------- ----------- ----------
Non-GAAP
adjusted gross
margin percent
(% of net sales) 43.2 % 39.8 % 42.1 % 41.7 % 41.4 %
Non-GAAP
Adjusted
Operating Income
Reported
operating income
(loss) (GAAP
basis) $ (68 ) $ 39 $ 409 $ (29 ) $ 588
Impairment of
goodwill and
intangible
assets 278 - - 278 -
Certain items
associated with
acquisitions(1) 53 54 71 107 186
Acquisition
integration and
deal costs 12 10 10 22 60
Restructuring
charges and
asset
impairments(2,
3, 4) 10 9 - 19 -
----------- ------------- ----------- ----------- ----------
Non-GAAP
adjusted
operating income $ 285 $ 112 $ 490 $ 397 $ 834
----------- ------------- ----------- ----------- ----------
Non-GAAP
adjusted
operating margin
percent (% of
net sales) 14.4 % 7.1 % 19.3 % 11.2 % 17.6 %
Non-GAAP
Adjusted Net
Income
Reported net
income (loss)
(GAAP basis) $ (129 ) $ 34 $ 289 $ (95 ) $ 406
Impairment of
goodwill and
intangible
assets 278 - - 278 -
Certain items
associated with
acquisitions(1) 53 54 71 107 186
Acquisition
integration and
deal costs 12 10 10 22 60
Restructuring
charges and
asset
impairments(2,
3, 4) 10 9 - 19 -
Impairment of
strategic
investments 2 - 3 2 3
Reinstatement of
federal R&D tax
credit (3 ) (10 ) - (13 ) -
Resolution of
audits of prior
years' income
tax filings - (11 ) (7 ) (11 ) (7 )
Income tax
effect of non-
GAAP adjustments (24 ) (17 ) (17 ) (41 ) (59 )
----------- ------------- ----------- ----------- ----------
Non-GAAP
adjusted net
income $ 199 $ 69 $ 349 $ 268 $ 589
----------- ------------- ----------- ----------- ----------
1 These items are incremental charges attributable to acquisitions,
consisting of inventory fair value adjustments on products sold, and
amortization of purchased intangible assets.
2 Results for the three months ended April 28, 2013 included $4 million of
employee-related costs related to the restructuring program announced on
October 3, 2012 and restructuring and asset impairment charges of $6
million related to the restructuring program announced on May 10, 2012.
3 Results for the three months ended January 27, 2013 included $4 million of
employee-related costs, net, related to the restructuring program announced
on October 3, 2012, asset impairment charges of $3 million related to the
restructuring program announced on May 10, 2012 and severance charges of $2
million related to the integration of Varian.
4 Results for the six months ended April 28, 2013 included $8 million of
employee-related costs, net, related to the restructuring program announced
on October 3, 2012, restructuring and asset impairment charges of $9
million related to the restructuring program announced on May 10, 2012 and
severance charges of $2 million related to the integration of Varian
APPLIED MATERIALS, INC.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ADJUSTED RESULTS
Three Months Ended Six Months Ended
------------------------------------- ----------------------
(In millions
except per share April 28, January 27, April 29, April 28, April 29,
amounts) 2013 2013 2012 2013 2012
----------- ------------- ----------- ----------- ----------
Non-GAAP
Adjusted
Earnings Per
Diluted Share
Reported
earnings (loss)
per diluted
share (GAAP
basis) $ (0.11 ) $ 0.03 $ 0.22 $ (0.08 ) $ 0.31
Impairment of
goodwill and
intangible
assets 0.22 - - 0.22 -
Certain items
associated with
acquisitions 0.04 0.03 0.04 0.07 0.11
Acquisition
integration and
deal costs 0.01 0.01 0.01 0.02 0.03
Restructuring
charges and
asset
impairments - 0.01 - 0.01 -
Reinstatement of
federal R&D tax
credit and
resolution of
audits of prior
years' income
tax filings - (0.02 ) - (0.02 ) -
----------- ------------- ----------- ----------- ----------
Non-GAAP
adjusted
earnings per
diluted share $ 0.16 $ 0.06 $ 0.27 $ 0.22 $ 0.45
----------- ------------- ----------- ----------- ----------
Weighted average
number of
diluted shares 1,217 1,212 1,301 1,216 1,305
APPLIED MATERIALS, INC.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ADJUSTED RESULTS
Three Months Ended Six Months Ended
------------------------------------- ----------------------
(In millions,
except April 28, January 27, April 29, April 28, April 29,
percentages) 2013 2013 2012 2013 2012
----------- ------------- ----------- ----------- ----------
SSG Non-GAAP
Adjusted
Operating Income
Reported
operating income
(GAAP basis) $ 283 $ 134 $ 504 $ 417 $ 775
Certain items
associated with
acquisitions(1) 45 44 60 89 161
Acquisition
integration and
deal costs 1 1 10 2 24
Restructuring
charges and
asset
impairments(3,
4) - 1 - 1 -
----------- ------------- ----------- ----------- ----------
Non-GAAP
adjusted
operating income $ 329 $ 180 $ 574 $ 509 $ 960
----------- ------------- ----------- ----------- ----------
Non-GAAP
adjusted
operating margin
percent (% of
net sales) 25.5 % 18.6 % 32.3 % 22.5 % 30.8 %
AGS Non-GAAP
Adjusted
Operating Income
Reported
operating income
(GAAP basis) $ 118 $ 89 $ 109 $ 207 $ 216
Certain items
associated with
acquisitions(1) 1 1 2 2 8
Restructuring
charges and
asset
impairments(2,
3, 4) 1 1 - 2 -
----------- ------------- ----------- ----------- ----------
Non-GAAP
adjusted
operating income $ 120 $ 91 $ 111 $ 211 $ 224
----------- ------------- ----------- ----------- ----------
Non-GAAP
adjusted
operating margin
percent (% of
net sales) 23.2 % 19.3 % 20.1 % 21.4 % 20.6 %
Display Non-GAAP
Adjusted
Operating Income
Reported
operating income
(GAAP basis) $ 19 $ 3 $ 7 $ 22 $ 12
Certain items
associated with
acquisitions(1) 2 2 2 4 4
----------- ------------- ----------- ----------- ----------
Non-GAAP
adjusted
operating income $ 21 $ 5 $ 9 $ 26 $ 16
----------- ------------- ----------- ----------- ----------
Non-GAAP
adjusted
operating margin
percent (% of
net sales) 16.5 % 5.7 % 6.7 % 12.1 % 6.7 %
EES Non-GAAP
Adjusted
Operating Loss
Reported
operating loss
(GAAP basis) $ (322 ) $ (54 ) $ (63 ) $ (376 ) $ (86 )
Impairment of
goodwill and
intangible
assets 278 - - 278 -
Certain items
associated with
acquisitions(1) 5 7 6 12 12
Restructuring
charges and
asset
impairments(2,
3, 4) 5 3 - 8 -
----------- ------------- ----------- ----------- ----------
Non-GAAP
adjusted
operating loss $ (34 ) $ (44 ) $ (57 ) $ (78 ) $ (74 )
----------- ------------- ----------- ----------- ----------
Non-GAAP
adjusted
operating margin
percent (% of
net sales) (89.5 )% (95.7 )% (72.2 )% (92.9 )% (25.9 )%
1 These items are incremental charges attributable to acquisitions,
consisting of inventory fair value adjustments on products sold, and
amortization of purchased intangible assets.
2 Results for the three months ended April 28, 2013 included restructuring
and asset impairment charges of $6 million related to the restructuring
program announced on May 10, 2012.
3 Results for the three months ended January 27, 2013 included asset
impairment charges of $3 million related to the restructuring program
announced on May 10, 2012 and severance charges of $2 million related to
the integration of Varian.
4 Results for the six months ended April 28, 2013 included restructuring and
asset impairment charges of $9 million related to the restructuring program
announced on May 10, 2012 and severance charges of $2 million related to
the integration of Varian.
APPLIED MATERIALS, INC.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ADJUSTED OPERATING EXPENSES
Three Months Ended
--------------------------
April 28, January 27,
(In millions) 2013 2013
------------ -------------
Operating expenses (GAAP basis) $ 876 $ 543
Impairment of goodwill and intangible assets (278 ) -
Acquisition integration and deal costs (11 ) (9 )
Certain items associated with acquisitions (10 ) (11 )
Restructuring charges and asset impairments (10 ) (9 )
------------ -------------
Non-GAAP adjusted operating expenses $ 567 $ 514
------------ -------------
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ADJUSTED EFFECTIVE INCOME TAX RATE
Three Months Ended
(In millions, except percentages) April 28, 2013
---------------------
Provision for income taxes (GAAP basis) (a) $ 39
Reinstatement of federal R&D tax credit 3
Income tax effect of non-GAAP adjustments 24
---------------------
Non-GAAP adjusted provision for income taxes (b) $ 66
---------------------
Income (loss) before income taxes (GAAP basis) (c) $ (90 )
Impairment of goodwill and intangible assets 278
Certain items associated with acquisitions 53
Acquisition integration costs 12
Restructuring charges and asset impairments 10
Impairment of strategic investments 2
---------------------
Non-GAAP adjusted income before income taxes (d) $ 265
---------------------
Effective income tax rate (GAAP basis) (a/c) (43.3 )%
---------------------
Non-GAAP adjusted effective income tax rate (b/d) 24.9 %
---------------------
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Applied Materials via Thomson Reuters ONE
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Datum: 16.05.2013 - 21:58 Uhr
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