| PIXELWORKS, INC. | ||||||
| RECONCILIATION OF GAAP AND NON-GAAP GROSS PROFIT MARGIN * | ||||||
| (Figures may not sum due to rounding) | ||||||
| (Unaudited) | ||||||
| Three Months Ended | ||||||
| March 31, | December 31, | March 31, | ||||
| 2020 | 2019 | 2019 | ||||
| Reconciliation of GAAP and non-GAAP gross profit margin | ||||||
| GAAP gross profit margin | 49.2% | 45.6% | 50.9% | |||
| Amortization of acquired intangible assets | 2.2% | 1.9% | 1.8% | |||
| Stock-based compensation | 0.7% | 0.6% | 0.6% | |||
| Inventory step-up and backlog amortization | —% | —% | 0.1% | |||
| Total reconciling items included in gross profit | 2.9% | 2.5% | 2.4% | |||
| Non-GAAP gross profit margin | 52.1% | 48.0% | 53.3% | |||
| *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. | ||||||
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PIXELWORKS, INC.
| ||||||||||||
| RECONCILIATION OF GAAP AND NON-GAAP FINANCIAL INFORMATION * | ||||||||||||
| (In thousands) | ||||||||||||
| (Unaudited) | ||||||||||||
| Three Months Ended | ||||||||||||
| March 31, | December 31, | March 31, | ||||||||||
| 2020 | 2019 | 2019 | ||||||||||
| Reconciliation of GAAP net income (loss) and adjusted EBITDA | ||||||||||||
| GAAP net income (loss) | $ | (5,399 | ) | $ | (4,456 | ) | $ | 133 | ||||
| Stock-based compensation | 1,822 | 1,797 | 1,689 | |||||||||
| Restructuring | 592 | — | — | |||||||||
| Amortization of acquired intangible assets | 374 | 374 | 382 | |||||||||
| Tax effect of non-GAAP adjustments | (25 | ) | (49 | ) | 219 | |||||||
| Gain on sale of patents | — | — | (3,905 | ) | ||||||||
| Inventory step-up and backlog amortization | — | — | 12 | |||||||||
| Non-GAAP net loss | $ | (2,636 | ) | $ | (2,334 | ) | $ | (1,470 | ) | |||
| EBITDA adjustments: | ||||||||||||
| Depreciation and amortization | $ | 1,022 | $ | 1,013 | $ | 913 | ||||||
| Non-GAAP interest income and other, net | (54 | ) | (324 | ) | (96 | ) | ||||||
| Non-GAAP provision (benefit) for income taxes | 201 | (69 | ) | 189 | ||||||||
| Adjusted EBITDA | $ | (1,467 | ) | $ | (1,714 | ) | $ | (464 | ) | |||
| *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. | ||||||||||||
