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PIXELWORKS, INC.
RECONCILIATION OF GAAP AND NON-GAAP GROSS PROFIT MARGIN * (Figures may not sum due to rounding) (Unaudited) | ||||||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||
| December 31, | September 30, | December 31, | December 31, | December 31, | ||||||||||||
| 2019 | 2019 | 2018 | 2019 | 2018 | ||||||||||||
| Reconciliation of GAAP and non-GAAP gross profit margin | ||||||||||||||||
| GAAP gross profit margin | 45.6 | % | 51.8 | % | 53.1 | % | 50.2 | % | 51.6 | % | ||||||
| Amortization of acquired intangible assets | 1.9 | % | 1.7 | % | 1.5 | % | 1.7 | % | 1.6 | % | ||||||
| Stock-based compensation | 0.6 | % | 0.5 | % | 0.5 | % | 0.5 | % | 0.4 | % | ||||||
| Inventory step-up and backlog amortization | — | % | — | % | 0.1 | % | — | % | 0.6 | % | ||||||
| Deferred revenue fair value adjustment | — | % | — | % | — | % | — | % | 0.1 | % | ||||||
| Total reconciling items included in gross profit | 2.5 | % | 2.1 | % | 2.0 | % | 2.3 | % | 2.7 | % | ||||||
| Non-GAAP gross profit margin | 48.0 | % | 53.9 | % | 55.1 | % | 52.5 | % | 54.2 | % | ||||||
| *Set forth above are reconciliations of the non-GAAP financial measure to the most directly comparable GAAP financial measure. The non-GAAP financial measure disclosed by the company has limitations and should not be considered a substitute for, or superior to, the financial measure prepared in accordance with GAAP, and the reconciliations from GAAP to Non-GAAP actuals should be carefully evaluated. Please refer to "Non-GAAP Financial Measures” in this document for an explanation of the adjustments made to the comparable GAAP measures, the ways management uses the non-GAAP measures, and the reasons why management believes the non-GAAP measures provide useful information for investors. | ||||||||||||||||
