GAAP gross margin percentage for the fourth quarter of fiscal 2016 was 50.9 percent, compared to 43.8 percent for the third quarter of fiscal 2016 and 51.4 percent for the fourth quarter of fiscal 2015. GAAP gross margin for fiscal year 2016 was 45.2 percent as compared to 50.3 percent in fiscal year 2015.

Non-GAAP gross margin percentage for the fourth quarter of fiscal 2016 was 51.9 percent, compared to 46.0 percent for the third quarter of fiscal 2016 and 51.8 percent for the fourth quarter of fiscal 2015. The sequential improvement in fourth quarter GAAP and Non-GAAP gross margin percentages was mainly due to a more lower mix of lower margin mobile handset platform-related revenues relative the prior quarter. Non-GAAP gross margin for fiscal year 2016 was 49.1 percent compared to 50.5 percent in fiscal year 2015.  The decline in GAAP and non-GAAP gross margin percentages in fiscal year 2016 was mainly due to a higher mix of lower margin mobile handset platform-related revenues relative to fiscal year 2015.  Refer to the GAAP to Non-GAAP reconciliation table and related footnotes at the end of this press release for more details.

Operating expenses on a GAAP basis for the fourth quarter of fiscal 2016 were $311 million, or 12 percent lower compared with $355 million in the third quarter of fiscal year 2016, and 14 percent lower compared to $360 million in the fourth quarter of fiscal 2015. Operating expenses on a GAAP basis for fiscal year 2016 were $2 billion, or 41 percent higher compared to $1.5 billion in fiscal year 2015.  GAAP operating expenses for fiscal 2016 include approximately $655 million related to the Carnegie Mellon University litigation settlement, with $78.9 million of the $750 million settlement recorded in COGS.  Operating expenses for the third and fourth quarters of fiscal year 2016 include $6 million and $11 million, respectively, of legal and accounting fees related to the Audit Committee investigation, and the related shareholder litigation and inquiries by the SEC and United States Attorney's Office.

Non-GAAP operating expenses were $267 million in the fourth quarter compared to $283 million in the third quarter, a 6 percent decline, and $315 million in the fourth quarter of fiscal 2015, a 15 percent decline. For fiscal year 2016, non-GAAP operating expenses were $1.2 billion (excluding the impact of $655 million related to Carnegie Mellon University litigation settlement recorded in operating expenses), a decline of 10 percent from $1.3 billion in fiscal year 2015.  Refer to the GAAP to Non-GAAP reconciliation table and related footnotes contained in this press release for more details.

Shares used to compute GAAP net income per diluted share for the fourth quarter of fiscal 2016 were 509 million shares, compared with 505 million shares in the third quarter of fiscal 2016 and 522 million shares in the fourth quarter of fiscal 2015.  Shares used to compute GAAP net income per diluted share for fiscal year 2016 were 511 million shares as compared with 521 million shares for fiscal year 2015.

Shares used to compute non-GAAP net income per diluted share for the fourth quarter of fiscal 2016 were 519 million shares, compared with 519 million shares for the third quarter of fiscal 2016 and 533 million shares for the fourth quarter of fiscal 2015.  Shares used to compute non-GAAP net income per diluted share for fiscal year 2016 were 526 million shares as compared with 532 million shares for fiscal year 2015.

Cash flow from operations for the fourth quarter of fiscal 2016 was $53 million, compared to $67 million in the third quarter of fiscal 2016 and $155 million reported in the fourth quarter of fiscal 2015.  Cash flow from operations for fiscal year 2016 was $205 million, compared to $729 million in fiscal year 2015. Free cash flow for the fourth quarter of fiscal 2016 was $47 million, compared to the $64 million in the third quarter of fiscal 2016 and the $135 million reported in the fourth quarter of fiscal 2015.  Free cash flow for fiscal year 2016 was $147 million, compared to $636 million in fiscal year 2015.  Free cash flow as presented above is defined as cash flow from operations, less capital expenditures and purchases of technology licenses reported under investing and financing activities in the consolidated statement of cash flows. 

Marvell made no share repurchases in the fourth quarter of fiscal 2016.  In fiscal year 2016, under the company's authorized share repurchase program, Marvell repurchased approximately 19.7 million shares for about $261 million. The remaining authorized amount for share repurchases at the end of fiscal 2016 was approximately $183 million. 

Marvell paid a quarterly dividend of $0.06 per share on December 29, 2015 to all shareholders of record as of December 16, 2015.  On March 16 and May 18, 2016, the Company declared cash dividends of $0.06 per share that were paid on April 22 and July 12, 2016, respectively.

The payment of future quarterly cash dividends on Marvell's common shares is subject to, among other things, the best interests of the company and its shareholders, its results of operations, cash balances and future cash requirements, financial condition, developments in ongoing litigation, statutory requirements of Bermuda law, and other factors that the board of directors may deem relevant.

Key Third Quarter of Fiscal 2016 Financial Highlights (Updated)

• Revenue: Q3 FY 2016, $675 Million
• GAAP Net Loss: Q3 FY 2016, ($58) Million
• GAAP Diluted Loss Per Share: Q3 FY 2016, ($0.11)
• Non-GAAP Net Income: Q3 FY 2016, $29 Million
• Non-GAAP Diluted EPS: Q3 FY 2016, $0.06
• Cash Flow from Operations: Q3 FY 2016, $67 Million

On December 7, 2015, Marvell released preliminary financial results for the third quarter of fiscal 2016, ended October 31, 2015. Due to the Company's delayed filing of its Form 10-Q, the Company is obligated to continue to adjust its financial results to account for subsequent activities (Type 1 subsequent events) occurring after December 7, 2015. For the third quarter of fiscal 2016, adjustments that have been recorded to the Company's preliminary financial results after December 7, 2015 are detailed in the footnotes to the condensed consolidated statements of operations at the end of this press release.  Accordingly, the Company's GAAP net loss and GAAP diluted loss per share for the third quarter of fiscal 2016 are approximately ($4) million and ($0.01) less than previously reported, respectively. Due to the delayed filing and as a result of future subsequent events, there may be additional adjustments to these preliminary financial results through the date of the Company's filing of its Form 10-Q for the third quarter of fiscal 2016.

Key Second Quarter of Fiscal 2016 Financial Highlights (Updated)               

• Revenue: Q2 FY 2016, $710 Million
• GAAP Net Loss: Q2 FY 2016, ($772) Million
• GAAP Diluted Loss Per Share: Q2 FY 2016, ($1.49)
• Non-GAAP Net Income: Q2 FY 2016, $39 Million
• Non-GAAP Diluted EPS: Q2 FY 2016, $0.07
• Cash Flow from Operations: Q2 FY 2016, $27 Million

On December 7, 2015, Marvell released updated preliminary financial results for the second quarter of fiscal 2016, ended August 1, 2015 . Due to the Company's delayed filing of its Form 10-Q, the Company is obligated to continue to adjust its financial results to account for subsequent activities (Type 1 subsequent events) occurring after September 11, 2015 .  For the second quarter of fiscal 2016, adjustments that that have been recorded to the Company's preliminary financial results after December 7, 2015 are detailed in the footnotes to the condensed consolidated statements of operations at the end of this press release including an additional $350.5 million charge due to the subsequent settlement in February 2016 for the Carnegie Mellon litigation (of which $78.9 million was recorded to COGS).   Accordingly, the Company's GAAP net loss and GAAP diluted loss per share for the second quarter of fiscal 2016 are approximately ($369) million and ($0.71) more than previously reported, respectively. Due to the delayed filing and as a result of future subsequent events, there may be additional adjustments to these preliminary financial results through the date of the Company's filing of its Form 10-Q for the second quarter of fiscal 2016.