Intersil Corporation

Non-GAAP Results

Unaudited

(In thousands, except percentages)

Quarter Ended

Sep. 30

Jul. 1

Oct. 2

2016

2016

2015

Q3 2016

Q2 2016

Q3 2015

Non-GAAP gross profit:

  GAAP gross profit

$             84,220

$    79,588

$      76,058

  Equity-based compensation COS

207

284

304

Non-GAAP gross profit

$             84,427

$    79,872

$      76,362

Non-GAAP gross margin:

GAAP gross margin

60.6%

59.4%

59.2%

  Excluded items as a percent of revenue

0.1%

0.2%

0.3%

Non-GAAP gross margin

60.7%

59.6%

59.5%

Non-GAAP R&D expenses:

  GAAP R&D expenses

$             31,315

$    34,211

$      31,252

  Equity-based compensation

(2,779)

(3,834)

(2,390)

Non-GAAP R&D expenses:

$             28,536

$    30,377

$      28,862

Non-GAAP SG&A expenses:

GAAP SG&A expenses

$             22,782

$    25,248

$      23,532

  Equity-based compensation

(2,577)

(4,004)

(2,871)

Non-GAAP SG&A expenses:

$             20,205

$    21,244

$      20,661

Non-GAAP operating expenses:

GAAP operating expenses

$             61,419

$    77,089

$      58,561

  Restructuring and related costs

(14)

(13,508)

-

  Provision for the TAOS litigation

-

(1,255)

-

  Equity-based compensation (excl. COS)

(5,356)

(7,838)

(5,261)

  Amortization of purchased intangibles

(2,669)

(2,867)

(3,777)

  Merger related expenses

(4,639)

-

-

Non-GAAP operating expenses

$             48,741

$    51,621

$      49,523

Non-GAAP operating income:

GAAP operating income

$             22,801

$      2,499

$      17,497

  Restructuring and related costs

14

13,508

-

  Provision for the TAOS litigation

-

1,255

-

  Equity-based compensation

5,563

8,122

5,565

  Amortization of purchased intangibles

2,669

2,867

3,777

  Merger related expenses

4,639

-

-

Non-GAAP operating income

$             35,686

$    28,251

$      26,839

Non-GAAP operating margin:

GAAP operating margin

16.4%

1.9%

13.6%

  Excluded items as a percent of revenue

9.3%

19.2%

7.3%

Non-GAAP operating margin 

25.7%

21.1%

20.9%