MaxLinear, Inc. Announces Second Quarter 2021 Financial Results

In addition to these risks and uncertainties, investors should review the risks and uncertainties contained in our filings with the Securities and Exchange Commission (SEC), including our Annual Report on Form 10-K for the year ended December 31, 2020 filed with the SEC on February 11, 2021, and our Current Reports on Form 8-K, as well as the information to be set forth under the caption “Risk Factors” in MaxLinear’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2021, which we expect to file soon. All forward-looking statements are based on the estimates, projections and assumptions of management as of July 28, 2021, and MaxLinear is under no obligation (and expressly disclaims any such obligation) to update or revise any forward-looking statements whether as a result of new information, future events, or otherwise.

Use of Non-GAAP Financial Measures

To supplement our unaudited consolidated financial statements presented on a basis consistent with GAAP, we disclose certain non-GAAP financial measures, including non-GAAP gross margin, operating expenses, operating expenses as a percentage of revenue, income from operations as percentage of revenue, and diluted earnings per share. These supplemental measures exclude the effects of (i) stock-based compensation expense; (ii) accruals related to our performance based bonus plan for 2021, which we currently intend to settle in shares of our common stock; (iii) accruals related to our performance based bonus plan for 2020, which we settled in shares of common stock in 2021; (iv) amortization of purchased intangible assets; (v) research and development funded by others; (vi) acquisition and integration costs related to our acquisitions; (vii) professional fees and settlement costs related to IP and commercial litigation matters; (viii) severance and other restructuring charges; (ix) impairment losses on intangible assets; (x) loss from extinguishment of debt; (xi) other non-recurring interest and other income (expenses), net attributable to acquisitions and (xii) non-cash income tax benefits and expenses. These non-GAAP measures are not in accordance with and do not serve as an alternative for GAAP. We believe that these non-GAAP measures have limitations in that they do not reflect all of the amounts associated with our GAAP results of operations. These non-GAAP measures should only be viewed in conjunction with corresponding GAAP measures. We compensate for the limitations of non-GAAP financial measures by relying upon GAAP results to gain a complete picture of our performance.

We believe that non-GAAP financial measures can provide useful information to both management and investors by excluding certain non-cash and other one-time expenses that are not indicative of our core operating results. Among other uses, our management uses non-GAAP measures to compare our performance relative to forecasts and strategic plans and to benchmark our performance externally against competitors. In addition, management’s incentive compensation will be determined in part using these non-GAAP measures because we believe non-GAAP measures better reflect our core operating performance.

The following are explanations of each type of adjustment that we incorporate into non-GAAP financial measures:

Stock-based compensation expense relates to equity incentive awards granted to our employees, directors, and consultants. Our equity incentive plans are important components of our employee incentive compensation arrangements and are reflected as expenses in our GAAP results. Stock-based compensation expense has been and will continue to be a significant recurring expense for MaxLinear. While we include the dilutive impact of equity awards in weighted average shares outstanding, the expense associated with stock-based awards reflects a non-cash charge that we exclude from non-GAAP net income.

Bonuses under our executive and non-executive bonus programs have been excluded from our non-GAAP net income for all periods reported. Bonus payments for the 2020 performance periods were settled through the issuance of shares of common stock under our equity incentive plans in March 2021. We currently expect that bonus awards under our fiscal 2021 program will be settled in common stock in the first quarter of fiscal 2022.

Expenses incurred in relation to acquisitions include amortization of purchased intangible assets, acquisition and integration costs primarily consisting of professional and consulting fees, and amortization of discount on deferred purchase price payments to interest expense.

Research and development funded by others represents proceeds received under a contract for a jointly funded R&D project to develop technology that may be commercialized into a product in the future. Such proceeds have not yet been recognized in GAAP results as the Company may be required to repay all or a portion of the funds provided by the other party under certain conditions. Management believes it is not probable that it will trigger such conditions.

Impairment losses relate to certain intangible assets.

Restructuring charges incurred are related to our restructuring plans which eliminate redundancies and primarily include severance and restructuring costs related to impairment of leased right-of-use assets or from exiting certain facilities.

Loss on extinguishment of debt is related to the charge-off of remaining unamortized debt discount and issuance costs on debt we repaid early with proceeds from a new term loan in June 2021.

Expenses incurred in relation to our intellectual property and commercial litigation include professional fees incurred.

Income tax benefits and expense adjustments are those that do not affect cash income taxes payable.

Reconciliations of non-GAAP measures for the historic periods disclosed in this press release appear below. Because of the inherent uncertainty associated with our ability to project future charges, particularly related to stock-based compensation and its related tax effects as well as potential impairments, we have not provided a reconciliation for non-GAAP guidance provided for the third quarter 2021.

About MaxLinear, Inc.

MaxLinear, Inc. (NYSE: MXL) is a leading provider of radio frequency (RF), analog, digital and mixed-signal integrated circuits for access and connectivity, wired and wireless infrastructure, and industrial and multi-market applications. MaxLinear is headquartered in Carlsbad, California. For more information, please visit www.maxlinear.com.

MXL is MaxLinear’s registered trademark. Other trademarks appearing herein are the property of their respective owners.

MAXLINEAR, INC. UNAUDITED GAAP CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data)

	Three Months Ended
	June 30, 2021			March 31, 2021			June 30, 2020
Net revenue	$	205,376		$	209,359		$	65,220
Cost of net revenue	92,833			97,640			32,477
Gross profit	112,543			111,719			32,743
Operating expenses:
Research and development	74,416			63,166			27,984
Selling, general and administrative	35,885			36,469			27,470
Restructuring charges	38			2,166			64
Total operating expenses	110,339			101,801			55,518
Income (loss) from operations	2,204			9,918			(22,775		)
Interest income	18			—			31
Interest expense	(3,741		)	(4,206		)	(2,183		)
Loss on extinguishment of debt	(5,221		)	—			—
Other income (expense), net	(537		)	(104		)	(81		)
Total other income (expense), net	(9,481		)	(4,310		)	(2,233		)
Income (loss) before income taxes	(7,277		)	5,608			(25,008		)
Income tax provision (benefit)	(8,010		)	1,806			(3,201		)
Net income (loss)	$	733		$	3,802		$	(21,807	)
Net income (loss) per share:
Basic	$	0.01		$	0.05		$	(0.30	)
Diluted	$	0.01		$	0.05		$	(0.30	)
Shares used to compute net income (loss) per share:
Basic	75,930			74,852			72,740
Diluted	79,026			78,283			72,740

MAXLINEAR, INC. UNAUDITED GAAP CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data)

	Six Months Ended
	June 30, 2021			June 30, 2020
Net revenue	$	414,735		$	127,247
Cost of net revenue	190,473			63,742
Gross profit	224,262			63,505
Operating expenses:
Research and development	137,582			53,673
Selling, general and administrative	72,354			52,102
Impairment losses	—			86
Restructuring charges	2,204			553
Total operating expenses	212,140			106,414
Income (loss) from operations	12,122			(42,909		)
Interest income	18			256
Interest expense	(7,947		)	(4,659		)
Loss on extinguishment of debt	(5,221		)	—
Other income (expense), net	(641		)	99
Total other income (expense), net	(13,791		)	(4,304		)
Loss before income taxes	(1,669		)	(47,213		)
Income tax benefit	(6,204		)	(9,937		)
Net income (loss)	$	4,535		$	(37,276	)
Net income (loss) per share:
Basic	$	0.06		$	(0.51	)
Diluted	$	0.06		$	(0.51	)
Shares used to compute net income (loss) per share:
Basic	75,394			72,389
Diluted	78,657			72,389

MAXLINEAR, INC. UNAUDITED GAAP CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands)

	Three Months Ended
	June 30, 2021			March 31, 2021			June 30, 2020
Operating Activities
Net income (loss)	$	733		$	3,802		$	(21,807	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Amortization and depreciation	21,997			22,325			16,532
Amortization of debt issuance costs and accretion of discount on debt and leases	918			1,153			397
Stock-based compensation	13,966			12,955			12,085
Deferred income taxes	(6,002		)	541			(2,879		)
Loss on disposal of property and equipment	20			368			—
Impairment of leasehold improvements	—			226			—
Impairment of leased right-of-use assets	—			429			—
Loss on extinguishment of debt	5,221			—			—
Loss on foreign currency and other	387			21			20
Excess tax benefits on stock based awards	(2,822		)	(1,809		)	(472		)
Changes in operating assets and liabilities:
Accounts receivable	(47,800		)	(20,079		)	3,362
Inventory	(6,254		)	5,658			(3,184		)
Prepaid expenses and other assets	3,588			29,860			(669		)
Leased right-of-use assets	36			36			(314		)
Accounts payable, accrued expenses and other current liabilities	8,652			(2,341		)	6,020
Accrued compensation	13,857			1,376			4,396
Accrued price protection liability	(344		)	7,299			(2,132		)
Lease liabilities	(2,345		)	(2,002		)	(1,279		)
Other long-term liabilities	4,043			454			(816		)
Net cash provided by operating activities	7,851			60,272			9,260
Investing Activities
Purchases of property and equipment	(11,158		)	(6,152		)	(3,901		)
Purchases of intangible assets	—			(1,112		)	(13		)
Cash used in acquisitions, net of cash acquired	(7,500		)	(20,000		)	—
Purchases of long-term investments	—			(5,000		)	—
Net cash used in investing activities	(18,658		)	(32,264		)	(3,914		)
Financing Activities
Proceeds from the issuance of debt	350,000			—			—
Payment of debt issuance cost	(4,127		)	—			—
Repayment of debt	(349,813		)	(20,000		)	—
Net proceeds from issuance of common stock	4,796			1,298			4,154
Minimum tax withholding paid on behalf of employees for restricted stock units	(2,663		)	(7,442		)	(1,024		)
Repurchase of common stock	(4,464		)	(2,673		)	—
Net cash provided by (used in) financing activities	(6,271		)	(28,817		)	3,130
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(681		)	(32		)	513
Increase (decrease) in cash, cash equivalents and restricted cash	(17,759		)	(841		)	8,989
Cash, cash equivalents and restricted cash at beginning of period	149,193			150,034			98,440
Cash, cash equivalents and restricted cash at end of period	$	131,434		$	149,193		$	107,429

MAXLINEAR, INC. UNAUDITED GAAP CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands)

	Six months ended
	June 30, 2021			June 30, 2020
Operating Activities
Net income (loss)	$	4,535		$	(37,276	)
Adjustments to reconcile net income (loss) to cash provided by operating activities:
Amortization and depreciation	44,322			33,265
Impairment losses	—			86
Amortization of debt issuance costs and accretion of discount on debt and leases	2,071			807
Stock-based compensation	26,921			18,912
Deferred income taxes	(5,461		)	(9,087		)
Loss on disposal of property and equipment	388			—
Impairment of leasehold improvements	226			163
Impairment of leased right-of-use assets	429			44
Loss on extinguishment of debt	5,221			—
(Gain) loss on foreign currency	408			(226		)
Excess tax benefits on stock-based awards	(4,631		)	(378		)
Changes in operating assets and liabilities, net of effects of acquisitions:
Accounts receivable	(67,879		)	8,977
Inventory	(596		)	(2,831		)
Prepaid expenses and other assets	33,448			774
Leased right-of-use assets	72			326
Accounts payable, accrued expenses and other current liabilities	6,311			5,235
Accrued compensation	15,233			7,757
Accrued price protection liability	6,955			(6,669		)
Lease liabilities	(4,347		)	(2,709		)
Other long-term liabilities	4,497			(1,262		)
Net cash provided by operating activities	68,123			15,908
Investing Activities
Purchases of property and equipment	(17,310		)	(4,936		)
Purchases of intangible assets	(1,112		)	(13		)
Cash used in acquisitions, net of cash acquired	(27,500		)	—
Purchases of available-for-sale securities	(5,000		)	—
Net cash used in investing activities	(50,922		)	(4,949		)
Financing Activities
Proceeds from the issuance of debt	350,000			—
Payment of debt issuance cost	(4,127		)	—
Repayment of debt	(369,813		)	—
Net proceeds from issuance of common stock	6,094			4,642
Minimum tax withholding paid on behalf of employees for restricted stock units	(10,105		)	(1,499		)
Repurchase of common stock	(7,137		)	—
Net cash provided by (used in) financing activities	(35,088		)	3,143
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(713		)	210
Increase (decrease) in cash, cash equivalents and restricted cash	(18,600		)	14,312
Cash, cash equivalents and restricted cash at beginning of period	150,034			93,117
Cash, cash equivalents and restricted cash at end of period	$	131,434		$	107,429

MAXLINEAR, INC. UNAUDITED GAAP CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands)

	June 30, 2021		March 31, 2021		June 30, 2020
Assets
Current assets:
Cash and cash equivalents	$	130,312	$	148,095	$	107,362
Short-term restricted cash	107		114		9
Accounts receivable, net	135,321		87,521		41,434
Inventory	98,502		92,154		34,284
Prepaid expenses and other current assets	13,866		17,096		7,489
Total current assets	378,108		344,980		190,578
Long-term restricted cash	1,015		984		58
Property and equipment, net	48,104		40,787		18,059
Leased right-of-use assets	22,847		24,403		8,942
Intangible assets, net	174,964		191,542		159,441
Goodwill	302,828		302,828		238,330
Deferred tax assets	91,526		85,524		76,371
Other long-term assets	7,235		7,551		1,281
Total assets	$	1,026,627	$	998,599	$	693,060

Liabilities and stockholders’ equity
Current liabilities	$	211,789	$	197,637	$	69,964
Long-term lease liabilities	20,445		22,419		6,833
Long-term debt	343,022		344,116		207,486
Other long-term liabilities	17,704		13,649		6,802
Stockholders’ equity	433,667		420,778		401,975
Total liabilities and stockholders’ equity	$	1,026,627	$	998,599	$	693,060

MAXLINEAR, INC. UNAUDITED RECONCILIATION OF NON-GAAP ADJUSTMENTS (in thousands, except per share data)

	Three Months Ended
	June 30, 2021			March 31, 2021			June 30, 2020
GAAP gross profit	$	112,543		$	111,719		$	32,743
Stock-based compensation	148			169			126
Performance based equity	127			82			109
Amortization of purchased intangible assets	10,743			10,747			8,581
Non-GAAP gross profit	123,561			122,717			41,559

GAAP R&D expenses	74,416			63,166			27,984
Stock-based compensation	(7,268		)	(7,162		)	(5,040		)
Performance based equity	(8,249		)	(4,598		)	(2,054		)
Research and development funded by others	(3,800		)	—			—
Acquisition and integration costs	(38		)	(92		)	—
Non-GAAP R&D expenses	55,061			51,314			20,890

GAAP SG&A expenses	35,885			36,469			27,470
Stock-based compensation	(6,551		)	(5,624		)	(6,920		)
Performance based equity	(3,357		)	(1,890		)	(1,144		)
Amortization of purchased intangible assets	(5,816		)	(6,070		)	(5,549		)
Acquisition and integration costs	(25		)	(1,561		)	(2,090		)
IP litigation costs, net	—			(11		)	(54		)
Non-GAAP SG&A expenses	20,136			21,313			11,713

GAAP restructuring expenses	38			2,166			64
Restructuring charges	(38		)	(2,166		)	(64		)
Non-GAAP restructuring expenses	—			—			—

GAAP income (loss) from operations	2,204			9,918			(22,775		)
Total non-GAAP adjustments	46,160			40,172			31,731
Non-GAAP income from operations	48,364			50,090			8,956

GAAP loss on extinguishment of debt	(5,221		)	—			—
Loss on extinguishment of debt	5,221			—			—
Non-GAAP loss on extinguishment of debt	—			—			—

GAAP and non-GAAP interest and other income (expense), net	(4,260		)	(4,310		)	(2,233		)
Non-recurring interest and other income (expense), net	133			310			—
Non-GAAP interest and other income (expense), net	(4,127		)	(4,000		)	(2,233		)

GAAP income (loss) before income taxes	(7,277		)	5,608			(25,008		)
Total non-GAAP adjustments	51,514			40,482			31,731
Non-GAAP income before income taxes	44,237			46,090			6,723

GAAP income tax provision (benefit)	(8,010		)	1,806			(3,201		)
Adjustment for non-cash tax benefits/expenses	10,665			959			3,605
Non-GAAP income tax provision	2,655			2,765			404

GAAP net income (loss)	733			3,802			(21,807		)
Total non-GAAP adjustments before income taxes	51,514			40,482			31,731
Less: total tax adjustments	10,665			959			3,605
Non-GAAP net income	$	41,582		$	43,325		$	6,319

Shares used in computing non-GAAP basic net income per share	75,930			74,852			72,740
Shares used in computing non-GAAP diluted net income per share	79,026			78,283			73,772
Non-GAAP basic net income per share	$	0.55		$	0.58		$	0.09
Non-GAAP diluted net income per share	$	0.53		$	0.55		$	0.09

MAXLINEAR, INC. UNAUDITED RECONCILIATION OF NON-GAAP ADJUSTMENTS (in thousands, except per share data)

	Six Months Ended
	June 30, 2021			June 30, 2020
GAAP gross profit	$	224,262		$	63,505
Stock-based compensation	317			274
Performance based equity	209			178
Amortization of purchased intangible assets	21,490			17,162
Non-GAAP gross profit	246,278			81,119

GAAP R&D expenses	137,582			53,673
Stock-based compensation	(14,430		)	(8,786		)
Performance based equity	(12,847		)	(3,804		)
Research and development funded by others	(3,800		)	—
Acquisition and integration costs	(130		)	—
Non-GAAP R&D expenses	106,375			41,083

GAAP SG&A expenses	72,354			52,102
Stock-based compensation	(12,175		)	(9,853		)
Performance based equity	(5,247		)	(2,280		)
Amortization of purchased intangible assets	(11,886		)	(11,272		)
Acquisition and integration costs	(1,586		)	(5,360		)
IP litigation costs, net	(11		)	(114		)
Non-GAAP SG&A expenses	41,449			23,223

GAAP impairment losses	—			86
Impairment losses	—			(86		)
Non-GAAP impairment losses	—			—

GAAP restructuring expenses	2,204			553
Restructuring charges	(2,204		)	(553		)
Non-GAAP restructuring expenses	—			—

GAAP income (loss) from operations	12,122			(42,909		)
Total non-GAAP adjustments	86,332			59,722
Non-GAAP income from operations	98,454			16,813

GAAP loss on extinguishment of debt	(5,221		)	—
Loss on extinguishment of debt	5,221			—
Non-GAAP loss on extinguishment of debt	—			—

GAAP and non-GAAP interest and other income (expense), net	(8,570		)	(4,304		)
Non-recurring interest and other income (expense), net	443			—
Non-GAAP interest and other income (expense), net	(8,127		)	(4,304		)

GAAP income (loss) before income taxes	(1,669		)	(47,213		)
Total non-GAAP adjustments	91,996			59,722
Non-GAAP income before income taxes	90,327			12,509

GAAP income tax provision (benefit)	(6,204		)	(9,937		)
Adjustment for non-cash tax benefits/expenses	11,624			10,688
Non-GAAP income tax provision	5,420			751

GAAP net income (loss)	4,535			(37,276		)
Total non-GAAP adjustments before income taxes	91,996			59,722
Less: total tax adjustments	11,624			10,688
Non-GAAP net income	$	84,907		$	11,758

Shares used in computing non-GAAP basic net income per share	75,394			72,389
Shares used in computing non-GAAP diluted net income per share	78,657			73,223
Non-GAAP basic net income per share	$	1.13		$	0.16
Non-GAAP diluted net income per share	$	1.08		$	0.16

MAXLINEAR, INC. UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

	Three Months Ended
	June 30, 2021		March 31, 2021		June 30, 2020
GAAP gross profit	54.8	%	53.4	%	50.2	%
Stock-based compensation	0.1	%	0.1	%	0.2	%
Performance based equity	0.1	%	—	%	0.2	%
Amortization of purchased intangible assets	5.2	%	5.1	%	13.2	%
Non-GAAP gross profit	60.2	%	58.6	%	63.7	%

GAAP R&D expenses	36.2	%	30.2	%	42.9	%
Stock-based compensation	(3.5	)%	(3.4	)%	(7.7	)%
Performance based equity	(4.0	)%	(2.2	)%	(3.1	)%
Research and development funded by others	(1.9	)%	—	%	—	%
Acquisition and integration costs	—	%	—	%	—	%
Non-GAAP R&D expenses	26.8	%	24.5	%	32.0	%

GAAP SG&A expenses	17.5	%	17.4	%	42.1	%
Stock-based compensation	(3.2	)%	(2.7	)%	(10.6	)%
Performance based equity	(1.6	)%	(0.9	)%	(1.8	)%
Amortization of purchased intangible assets	(2.8	)%	(2.9	)%	(8.5	)%
Acquisition and integration costs	—	%	(0.8	)%	(3.2	)%
IP litigation costs, net	—	%	—	%	(0.1	)%
Non-GAAP SG&A expenses	9.8	%	10.2	%	18.0	%

GAAP restructuring expenses	—	%	1.0	%	0.1	%
Restructuring charges	—	%	(1.0	)%	(0.1	)%
Non-GAAP restructuring expenses	—	%	—	%	—	%

GAAP income (loss) from operations	1.1	%	4.7	%	(34.9	)%
Total non-GAAP adjustments	22.5	%	19.2	%	48.7	%
Non-GAAP income from operations	23.6	%	23.9	%	13.7	%

GAAP loss on extinguishment of debt	(2.5	)%	—	%	—	%
Loss on extinguishment of debt	2.5	%	—	%	—	%
Non-GAAP loss on extinguishment of debt	—	%	—	%	—	%

GAAP and non-GAAP interest and other income (expense), net	(2.1	)%	(2.1	)%	(3.4	)%
Non-recurring interest and other income (expense), net	0.1	%	0.1	%	—	%
Non-GAAP interest and other income (expense), net	(2.0	)%	(1.9	)%	(3.4	)%

GAAP income (loss) before income taxes	(3.5	)%	2.7	%	(38.3	)%
Total non-GAAP adjustments before income taxes	25.1	%	19.3	%	48.7	%
Non-GAAP income before income taxes	21.5	%	22.0	%	10.3	%

GAAP income tax provision (benefit)	(3.9	)%	0.9	%	(4.9	)%
Adjustment for non-cash tax benefits/expenses	5.2	%	0.5	%	5.5	%
Non-GAAP income tax provision	1.3	%	1.3	%	0.6	%

GAAP net income (loss)	0.4	%	1.8	%	(33.4	)%
Total non-GAAP adjustments before income taxes	25.1	%	19.3	%	48.7	%
Less: total tax adjustments	5.2	%	0.5	%	5.5	%
Non-GAAP net income	20.3	%	20.7	%	9.7	%

MAXLINEAR, INC. UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

	Six Months Ended
	June 30, 2021		June 30, 2020
GAAP gross profit	54.1	%	49.9	%
Stock-based compensation	0.1	%	0.2	%
Performance based equity	0.1	%	0.1	%
Amortization of purchased intangible assets	5.2	%	13.5	%
Non-GAAP gross profit	59.4	%	63.7	%

GAAP R&D expenses	33.2	%	42.2	%
Stock-based compensation	(3.5	)%	(6.9	)%
Performance based equity	(3.1	)%	(3.0	)%
Research and development funded by others	(0.9	)%	—	%
Acquisition and integration costs	—	%	—	%
Non-GAAP R&D expenses	25.7	%	32.3	%

GAAP SG&A expenses	17.4	%	40.9	%
Stock-based compensation	(2.9	)%	(7.7	)%
Performance based equity	(1.3	)%	(1.8	)%
Amortization of purchased intangible assets	(2.9	)%	(8.9	)%
Acquisition and integration costs	(0.4	)%	(4.2	)%
IP litigation costs, net	—	%	(0.1	)%
Non-GAAP SG&A expenses	10.0	%	18.3	%

GAAP impairment losses	—	%	0.1	%
Impairment losses	—	%	(0.1	)%
Non-GAAP impairment losses	—	%	—	%

GAAP restructuring expenses	0.5	%	0.4	%
Restructuring charges	(0.5	)%	(0.4	)%
Non-GAAP restructuring expenses	—	%	—	%

GAAP income (loss) from operations	2.9	%	(33.7	)%
Total non-GAAP adjustments	20.8	%	46.9	%
Non-GAAP income from operations	23.7	%	13.2	%

GAAP loss on extinguishment of debt	(1.3	)%	—	%
Loss on extinguishment of debt	1.3	%	—	%
Non-GAAP loss on extinguishment of debt	—	%	—	%

GAAP and non-GAAP interest and other income (expense), net	(2.1	)%	(3.4	)%
Non-recurring interest and other income (expense), net	0.1	%	—	%
Non-GAAP interest and other income (expense), net	(2.0	)%	(3.4	)%

GAAP income (loss) before income taxes	(0.4	)%	(37.1	)%
Total non-GAAP adjustments	22.2	%	46.9	%
Non-GAAP income before income taxes	21.8	%	9.8	%

GAAP income tax provision (benefit)	(1.5	)%	(7.8	)%
Adjustment for non-cash tax benefits/expenses	2.8	%	8.4	%
Non-GAAP income tax provision	1.3	%	0.6	%

GAAP net income (loss)	1.1	%	(29.3	)%
Total non-GAAP adjustments before income taxes	22.2	%	46.9	%
Less: total tax adjustments	2.8	%	8.4	%
Non-GAAP net income	20.5	%	9.2	%

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