Reconciliation of GAAP to Non-GAAP Operating Results
(in thousands, except percentages and per ADS data, unaudited)
| For Three Months Ended | For the Year Ended | ||||||||||||||
| Dec. 31, | Sep. 30, | Dec. 31, | Dec. 31, | Dec. 31, | |||||||||||
|
2019
| 2020 | 2020 | 2019 | 2020 | |||||||||||
| ($) | ($) | ($) | ($) | ($) | |||||||||||
| Gross profit (GAAP) | 73,633 | 61,826 | 66,044 | 222,172 | 260,156 | ||||||||||
| Gross margin (GAAP) | 48.1 | % | 49.1 | % | 45.9 | % | 48.6 | % | 48.2 | % | |||||
| Stock-based compensation (A) | 141 | 55 | 157 | 305 | 253 | ||||||||||
| SSD solutions restructuring | 1,618 | - | 4,772 | 8,175 | 4,772 | ||||||||||
| Gross profit (non-GAAP) (B) | 75,392 | 61,881 | 70,973 | 230,652 | 265,181 | ||||||||||
| Gross margin (non-GAAP) (C) | 49.3 | % | 49.1 | % | 49.3 | % | 50.2 | % | 49.2 | % | |||||
| Operating expenses (GAAP) | 46,314 | 35,983 | 65,645 | 170,027 | 179,682 | ||||||||||
| Stock-based compensation (A) | (7,209 | ) | (3,076 | ) | (8,572 | ) | (14,286 | ) | (14,335 | ) | |||||
| Amortization of intangible assets | - | - | - | (766 | ) | - | |||||||||
| SSD solutions restructuring | (928 | ) | - | (17,613 | ) | (16,898 | ) | (17,613 | ) | ||||||
| Litigation expense | - | - | - | 2 | - | ||||||||||
| Operating expenses (non-GAAP) (B) | 38,177 | 32,907 | 39,460 | 138,079 | 147,734 | ||||||||||
| Operating profit (GAAP) | 27,319 | 25,843 | 399 | 52,145 | 80,474 | ||||||||||
| Operating margin (GAAP) | 17.8 | % | 20.5 | % | 0.3 | % | 11.4 | % | 14.9 | % | |||||
| Total adjustments to operating profit | 9,896 | 3,131 | 31,114 | 40,428 | 36,973 | ||||||||||
| Operating profit (non-GAAP) (B) | 37,215 | 28,974 | 31,513 | 92,573 | 117,447 | ||||||||||
| Operating margin (non-GAAP) (C) | 24.3 | % | 23.0 | % | 21.9 | % | 20.1 | % | 21.8 | % | |||||
| Non-operating income (expense) (GAAP) | 1,678 | 1,386 | 1,245 | 19,929 | 5,084 | ||||||||||
| Foreign exchange loss (gain), net | (84 | ) | (551 | ) | (692 | ) | (148 | ) | (619 | ) | |||||
| Gain on disposal of long-term investments | - | - | 293 | (12,941 | ) | 293 | |||||||||
| Non-operating income (expense) (non-GAAP) (B) | 1,594 | 835 | 846 | 6,840 | 4,758 | ||||||||||
| Net income (GAAP) | 25,430 | 24,267 | 1,354 | 64,398 | 79,746 | ||||||||||
| Total pre-tax impact of non-GAAP adjustments (B) | 9,812 | 2,580 | 30,715 | 27,339 | 36,647 | ||||||||||
| Income tax impact of non-GAAP adjustments (B) | (1,430 | ) | (171 | ) | (2,152 | ) | (2,708 | ) | (2,845 | ) | |||||
| Net income (non-GAAP) (B), (C) | 33,812 | 26,676 | 29,917 | 89,029 | 113,548 | ||||||||||
| Earnings per diluted ADS (GAAP) | $0.73 | $0.70 | $0.04 | $1.82 | $2.28 | ||||||||||
| Earnings per diluted ADS (non-GAAP) (B), (C) | $0.96 | $0.76 | $0.86 | $2.51 | $3.24 | ||||||||||
| Shares used in computing earnings per diluted ADS (GAAP) | 35,021 | 34,891 | 34,761 | 35,296 | 34,978 | ||||||||||
| Non-GAAP Adjustments | 171 | 163 | 219 | 106 | 121 | ||||||||||
| Shares used in computing earnings per diluted ADS (non-GAAP) | 35,192 | 35,054 | 34,980 | 35,402 | 35,099 | ||||||||||
| (A) Excludes stock-based compensation as follows: | |||||||||||||||
| Cost of Sales | 141 | 55 | 157 | 305 | 253 | ||||||||||
| Research & development | 5,178 | 2,163 | 6,196 | 9,927 | 10,132 | ||||||||||
| Sales & marketing | 790 | 405 | 933 | 1,789 | 1,758 | ||||||||||
| General & administrative | 1,241 | 508 | 1,443 | 2,570 | 2,445 | ||||||||||
| (B) FCI divestiture items previously excluded from non-GAAP: | |||||||||||||||
| Revenue | - | - | - | 10,359 | - | ||||||||||
| Gross Profit | - | - | - | 5,687 | - | ||||||||||
| Operating Expenses | - | - | - | 8,542 | - | ||||||||||
| Operating Profit | - | - | - | (2,855 | ) | - | |||||||||
| Non-Operating Income | - | - | - | 9 | - | ||||||||||
| Taxes | - | - | - | 8 | - | ||||||||||
| Net income | - | - | - | (2,854 | ) | - | |||||||||
| EPS | - | - | - | (0.08 | ) | - | |||||||||
| (C) Reconciliation with previous non-GAAP disclosures: | |||||||||||||||
| Revenue (GAAP) | 153,196 | 126,043 | 143,897 | 457,253 | 539,521 | ||||||||||
| SSD solutions restructuring | (162 | ) | - | - | 2,494 | - | |||||||||
| Revenue (non-GAAP) | 153,034 | 126,043 | 143,897 | 459,747 | 539,521 | ||||||||||
| FCI | - | - | - | (10,359 | ) | - | |||||||||
| Revenue (non-GAAP) less FCI | 153,034 | 126,043 | 143,897 | 449,388 | 539,521 | ||||||||||
| Gross Margin (non-GAAP) less FCI | 49.3 | % | 49.1 | % | 49.3 | % | 50.1 | % | 49.2 | % | |||||
| Operating Margin (non-GAAP) less FCI | 24.3 | % | 23.0 | % | 21.9 | % | 21.2 | % | 21.8 | % | |||||
| EPS (non-GAAP) less FCI | $0.96 | $0.76 | $0.86 | US$2.60 | $3.24 | ||||||||||
