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Share Name | Share Symbol | Market | Type |
---|---|---|---|
MACOM Technology Solutions Holdings Inc | NASDAQ:MTSI | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
-0.045 | -0.04% | 102.805 | 102.74 | 102.95 | 107.00 | 102.59 | 104.11 | 292,020 | 17:52:39 |
|
|
ý
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
Delaware
|
|
27-0306875
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
|
Large accelerated filer
|
x
|
|
|
Accelerated filer
|
¨
|
Non-accelerated filer
|
¨
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(Do not check if a smaller reporting company)
|
|
Smaller reporting company
|
¨
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|
|
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Page No.
|
Item 1.
|
|||
|
|
||
|
|
||
|
|
||
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Item 2.
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|||
Item 3.
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|||
Item 4.
|
|||
Item 1.
|
|||
Item1A.
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|||
Item 2.
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|||
Item 6.
|
|||
ITEM 1.
|
FINANCIAL STATEMENTS
|
|
December 30,
2016 |
|
September 30,
2016 |
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
353,917
|
|
|
$
|
332,977
|
|
Short term investments
|
23,750
|
|
|
23,776
|
|
||
Accounts receivable (less allowances of $3,455 and $3,279, respectively)
|
112,245
|
|
|
108,331
|
|
||
Inventories
|
115,219
|
|
|
114,935
|
|
||
Income tax receivable
|
21,025
|
|
|
21,607
|
|
||
Prepaid and other current assets
|
15,619
|
|
|
11,318
|
|
||
Total current assets
|
$
|
641,775
|
|
|
$
|
612,944
|
|
Property and equipment, net
|
101,845
|
|
|
99,167
|
|
||
Goodwill
|
118,082
|
|
|
120,024
|
|
||
Intangible assets, net
|
240,933
|
|
|
259,602
|
|
||
Deferred income taxes
|
88,565
|
|
|
89,606
|
|
||
Other long-term assets
|
5,495
|
|
|
7,208
|
|
||
TOTAL ASSETS
|
$
|
1,196,695
|
|
|
$
|
1,188,551
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Current portion of lease payable
|
$
|
1,047
|
|
|
$
|
1,152
|
|
Current portion of long-term debt
|
6,051
|
|
|
6,051
|
|
||
Accounts payable
|
31,686
|
|
|
30,579
|
|
||
Accrued liabilities
|
48,279
|
|
|
54,368
|
|
||
Total current liabilities
|
$
|
87,063
|
|
|
$
|
92,150
|
|
Lease payable, less current portion
|
14,147
|
|
|
2,463
|
|
||
Long-term debt, less current portion
|
572,963
|
|
|
573,882
|
|
||
Warrant liability
|
43,076
|
|
|
38,253
|
|
||
Deferred income taxes
|
9,564
|
|
|
11,765
|
|
||
Other long-term liabilities
|
6,923
|
|
|
7,254
|
|
||
Total liabilities
|
$
|
733,736
|
|
|
$
|
725,767
|
|
Stockholders’ equity:
|
|
|
|
||||
Common stock
|
54
|
|
|
54
|
|
||
Treasury stock, at cost
|
(330
|
)
|
|
(330
|
)
|
||
Accumulated other comprehensive (loss) income
|
(604
|
)
|
|
9,039
|
|
||
Additional paid-in capital
|
562,292
|
|
|
551,509
|
|
||
Accumulated deficit
|
(98,453
|
)
|
|
(97,488
|
)
|
||
Total stockholders’ equity
|
$
|
462,959
|
|
|
$
|
462,784
|
|
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
|
$
|
1,196,695
|
|
|
$
|
1,188,551
|
|
|
Three Months Ended
|
||||||
|
December 30,
2016 |
|
January 1,
2016 |
||||
Revenue
|
$
|
151,752
|
|
|
$
|
115,774
|
|
Cost of revenue
|
73,257
|
|
|
55,456
|
|
||
Gross profit
|
78,495
|
|
|
60,318
|
|
||
Operating expenses:
|
|
|
|
||||
Research and development
|
30,174
|
|
|
25,322
|
|
||
Selling, general and administrative
|
36,496
|
|
|
34,686
|
|
||
Restructuring charges
|
1,287
|
|
|
157
|
|
||
Total operating expenses
|
67,957
|
|
|
60,165
|
|
||
Income from operations
|
10,538
|
|
|
153
|
|
||
Other (expense) income
|
|
|
|
||||
Warrant liability expense
|
(4,823
|
)
|
|
(14,878
|
)
|
||
Interest expense, net
|
(7,350
|
)
|
|
(4,346
|
)
|
||
Other (expense) income
|
(4
|
)
|
|
100
|
|
||
Total other expense, net
|
(12,177
|
)
|
|
(19,124
|
)
|
||
Loss before income taxes
|
(1,639
|
)
|
|
(18,971
|
)
|
||
Income tax expense (benefit)
|
532
|
|
|
(2,201
|
)
|
||
Loss from continuing operations
|
(2,171
|
)
|
|
(16,770
|
)
|
||
Income from discontinued operations
|
1,206
|
|
|
1,199
|
|
||
Net loss
|
$
|
(965
|
)
|
|
$
|
(15,571
|
)
|
|
|
|
|
||||
Net income (loss) per share:
|
|
|
|
||||
Basic income (loss) per share:
|
|
|
|
||||
Loss from continuing operations
|
$
|
(0.04
|
)
|
|
$
|
(0.32
|
)
|
Income from discontinued operations
|
0.02
|
|
|
0.02
|
|
||
Loss per share - basic
|
$
|
(0.02
|
)
|
|
$
|
(0.29
|
)
|
Diluted income (loss) per share:
|
|
|
|
||||
Loss from continuing operations
|
$
|
(0.04
|
)
|
|
$
|
(0.32
|
)
|
Income from discontinued operations
|
0.02
|
|
|
0.02
|
|
||
Loss per share - diluted
|
$
|
(0.02
|
)
|
|
$
|
(0.29
|
)
|
Shares used:
|
|
|
|
||||
Basic
|
53,737
|
|
|
53,015
|
|
||
Diluted
|
53,737
|
|
|
53,015
|
|
|
Three Months Ended
|
||||||
|
December 30,
2016 |
|
January 1,
2016 |
||||
Net loss
|
$
|
(965
|
)
|
|
$
|
(15,571
|
)
|
Unrealized loss on short term investments, net of tax
|
(46
|
)
|
|
(61
|
)
|
||
Foreign currency translation loss, net of tax
|
(9,597
|
)
|
|
(109
|
)
|
||
Other comprehensive loss, net of tax
|
(9,643
|
)
|
|
(170
|
)
|
||
Total comprehensive loss
|
$
|
(10,608
|
)
|
|
$
|
(15,741
|
)
|
|
|
|
|
|
Accumulated
Other
Comprehensive Income
(Loss)
|
|
Additional
Paid-in
Capital
|
Accumulated
Deficit
|
|
Total
Stockholders’
Equity
|
||||||||||||||||||
|
Common Stock
|
|
Treasury Stock
|
|||||||||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|||||||||||||||||||||
Balance at September 30, 2016
|
53,709
|
|
|
$
|
54
|
|
|
23
|
|
|
$
|
(330
|
)
|
|
$
|
9,039
|
|
|
$
|
551,509
|
|
$
|
(97,488
|
)
|
|
$
|
462,784
|
|
Stock options exercises
|
36
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
180
|
|
—
|
|
|
180
|
|
||||||
Issuance of common stock pursuant to employee stock purchase plan
|
77
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,420
|
|
—
|
|
|
2,420
|
|
||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,183
|
|
—
|
|
|
8,183
|
|
||||||
Other comprehensive loss, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9,643
|
)
|
|
—
|
|
—
|
|
|
(9,643
|
)
|
||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
(965
|
)
|
|
(965
|
)
|
||||||
Balance at December 30, 2016
|
53,822
|
|
|
$
|
54
|
|
|
23
|
|
|
$
|
(330
|
)
|
|
$
|
(604
|
)
|
|
$
|
562,292
|
|
$
|
(98,453
|
)
|
|
$
|
462,959
|
|
MACOM TECHNOLOGY SOLUTIONS HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
|
|||||||
|
Three Months Ended
|
||||||
|
December 30, 2016
|
|
January 1, 2016
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
||||
Net loss
|
$
|
(965
|
)
|
|
$
|
(15,571
|
)
|
Adjustments to reconcile net loss to net cash provided by (used in) operating activities (net of acquisitions):
|
|
|
|
||||
Depreciation and intangibles amortization
|
18,475
|
|
|
15,893
|
|
||
Stock-based compensation
|
8,183
|
|
|
7,382
|
|
||
Warrant liability expense
|
4,823
|
|
|
14,878
|
|
||
Acquired inventory step-up amortization
|
—
|
|
|
(394
|
)
|
||
Deferred financing cost amortization
|
702
|
|
|
405
|
|
||
Prepaid compensation amortization
|
506
|
|
|
2,634
|
|
||
Deferred income taxes
|
(1,054
|
)
|
|
(1,548
|
)
|
||
Other adjustments, net
|
76
|
|
|
84
|
|
||
Change in operating assets and liabilities (net of acquisitions):
|
|
|
|
||||
Accounts receivable
|
(4,488
|
)
|
|
(1,409
|
)
|
||
Inventories
|
(1,583
|
)
|
|
(3,827
|
)
|
||
Prepaid expenses and other assets
|
(673
|
)
|
|
(608
|
)
|
||
Accounts payable
|
931
|
|
|
(266
|
)
|
||
Accrued and other liabilities
|
(5,547
|
)
|
|
(1,512
|
)
|
||
Income taxes
|
1,021
|
|
|
(627
|
)
|
||
Net cash provided by operating activities
|
20,407
|
|
|
15,514
|
|
||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
||||
Acquisition of businesses, net
|
875
|
|
|
(85,517
|
)
|
||
Purchases of property and equipment
|
(4,942
|
)
|
|
(6,230
|
)
|
||
Proceeds from sale of assets
|
104
|
|
|
—
|
|
||
Proceeds from sales and maturities of investments
|
8,822
|
|
|
9,543
|
|
||
Purchases of investments
|
(8,902
|
)
|
|
—
|
|
||
Acquisition of intellectual property
|
—
|
|
|
(476
|
)
|
||
Net cash used in investing activities
|
(4,043
|
)
|
|
(82,680
|
)
|
||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
||||
Proceeds from corporate facility financing obligation
|
4,250
|
|
|
—
|
|
||
Proceeds from stock option exercises and employee stock purchases
|
2,600
|
|
|
2,817
|
|
||
Payments on notes payable
|
(1,513
|
)
|
|
(875
|
)
|
||
Payments of capital leases and assumed debt
|
(288
|
)
|
|
(8,731
|
)
|
||
Repurchase of common stock
|
—
|
|
|
(339
|
)
|
||
Other adjustments
|
(38
|
)
|
|
—
|
|
||
Net cash provided by (used in) financing activities
|
5,011
|
|
|
(7,128
|
)
|
||
Foreign currency effect on cash
|
(435
|
)
|
|
(210
|
)
|
||
NET CHANGE IN CASH AND CASH EQUIVALENTS
|
20,940
|
|
|
(74,504
|
)
|
||
CASH AND CASH EQUIVALENTS — Beginning of period
|
$
|
332,977
|
|
|
$
|
122,312
|
|
CASH AND CASH EQUIVALENTS — End of period
|
$
|
353,917
|
|
|
$
|
47,808
|
|
1.
|
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|
|
Preliminary Allocation
as of September 30, 2016
|
|
Allocation Adjustments
|
|
Final Allocation
|
||||||
|
|
|
|
|
|
||||||
Current assets
|
$
|
10,445
|
|
|
$
|
—
|
|
|
$
|
10,445
|
|
Intangible assets
|
45,650
|
|
|
—
|
|
|
45,650
|
|
|||
Other assets
|
3,317
|
|
|
—
|
|
|
3,317
|
|
|||
Total assets acquired
|
59,412
|
|
|
—
|
|
|
59,412
|
|
|||
Liabilities assumed:
|
|
|
|
|
|
||||||
Debt
|
11,627
|
|
|
—
|
|
|
11,627
|
|
|||
Deferred income taxes
|
11,658
|
|
|
(106
|
)
|
|
11,552
|
|
|||
Other liabilities
|
3,968
|
|
|
326
|
|
|
4,294
|
|
|||
Total liabilities assumed
|
27,253
|
|
|
220
|
|
|
27,473
|
|
|||
Net assets acquired
|
32,159
|
|
|
(220
|
)
|
|
31,939
|
|
|||
Consideration:
|
|
|
|
|
|
||||||
Cash paid upon closing, net of cash acquired
|
47,517
|
|
|
—
|
|
|
47,517
|
|
|||
Goodwill
|
$
|
15,358
|
|
|
$
|
220
|
|
|
$
|
15,578
|
|
|
Amount
|
|
Useful Lives (Years)
|
||
Developed technology
|
$
|
9,400
|
|
|
7
|
Customer relationships
|
36,250
|
|
|
10
|
|
|
$
|
45,650
|
|
|
|
|
|
Amount
|
|
Revenue
|
$
|
2,670
|
|
Loss before income taxes
|
|
(811
|
)
|
|
January 1, 2016
|
||
Revenue
|
$
|
123,400
|
|
Net loss
|
(15,127
|
)
|
|
Preliminary Allocation as of September 30, 2016
|
|
Allocation Adjustments
|
|
Final Allocation
|
||||||
|
|
|
|
|
|
||||||
Current assets
|
$
|
12,614
|
|
|
$
|
—
|
|
|
$
|
12,614
|
|
Intangible assets
|
20,900
|
|
|
—
|
|
|
20,900
|
|
|||
Other assets
|
3,089
|
|
|
—
|
|
|
3,089
|
|
|||
Total assets acquired
|
36,603
|
|
|
—
|
|
|
36,603
|
|
|||
Liabilities assumed:
|
|
|
|
|
|
||||||
Other liabilities
|
7,201
|
|
|
—
|
|
|
7,201
|
|
|||
Total liabilities assumed
|
7,201
|
|
|
—
|
|
|
7,201
|
|
|||
Net assets acquired
|
29,402
|
|
|
—
|
|
|
29,402
|
|
|||
Consideration:
|
|
|
|
|
|
||||||
Cash paid upon closing, net of cash acquired
|
37,125
|
|
|
—
|
|
|
37,125
|
|
|||
Goodwill
|
$
|
7,723
|
|
|
$
|
—
|
|
|
$
|
7,723
|
|
|
Amount
|
|
Useful Lives (Years)
|
||
Developed technology
|
$
|
1,000
|
|
|
7
|
Customer relationships
|
19,900
|
|
|
10
|
|
|
$
|
20,900
|
|
|
|
|
|
Amount
|
||
Revenue
|
|
$
|
1,907
|
|
Income before income taxes
|
|
(46
|
)
|
|
|
January 1, 2016
|
||
Revenue
|
|
$
|
124,610
|
|
Net loss
|
|
(15,583
|
)
|
|
|
Three Months Ended
|
||||||
|
|
December 30, 2016
|
|
January 1, 2016
|
||||
Income from operations
|
|
—
|
|
|
—
|
|
||
Other income
|
|
1,875
|
|
|
1,875
|
|
||
Gain on sale
|
|
—
|
|
|
—
|
|
||
Income before income taxes
|
|
1,875
|
|
|
1,875
|
|
||
Income tax provision
|
|
669
|
|
|
676
|
|
||
Income from discontinued operations
|
|
$
|
1,206
|
|
|
$
|
1,199
|
|
|
|
|
|
|
||||
Cash flow from operating activities
|
|
—
|
|
|
—
|
|
|
December 30, 2016
|
||||||||||||||
|
Amortized
Cost
|
|
Gross
Unrealized
Holding Gains
|
|
Gross
Unrealized
Holding Losses
|
|
Aggregate Fair
Value
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Corporate bonds
|
$
|
14,948
|
|
|
$
|
—
|
|
|
$
|
(160
|
)
|
|
$
|
14,788
|
|
Commercial Paper
|
5,970
|
|
|
—
|
|
|
(6
|
)
|
|
5,964
|
|
||||
Agency bonds
|
3,002
|
|
|
—
|
|
|
(4
|
)
|
|
2,998
|
|
||||
Total investments
|
$
|
23,920
|
|
|
$
|
—
|
|
|
$
|
(170
|
)
|
|
$
|
23,750
|
|
|
September 30, 2016
|
||||||||||||||
|
Amortized
Cost
|
|
Gross
Unrealized
Holding Gains
|
|
Gross
Unrealized
Holding Losses
|
|
Aggregate Fair
Value
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Corporate bonds
|
$
|
14,894
|
|
|
$
|
9
|
|
|
$
|
(103
|
)
|
|
$
|
14,800
|
|
Commercial Paper
|
2,978
|
|
|
—
|
|
|
(4
|
)
|
|
2,974
|
|
||||
Agency bonds
|
6,004
|
|
|
1
|
|
|
(3
|
)
|
|
6,002
|
|
||||
Total investments
|
$
|
23,876
|
|
|
$
|
10
|
|
|
$
|
(110
|
)
|
|
$
|
23,776
|
|
|
December 30, 2016
|
|
September 30, 2016
|
||||
Less than 1 year
|
$
|
8,961
|
|
|
$
|
8,976
|
|
Over 1 year
|
14,789
|
|
|
14,800
|
|
||
Total investments
|
$
|
23,750
|
|
|
$
|
23,776
|
|
Level 1
- Quoted prices in active markets for identical assets or liabilities.
|
Level 2
- Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets with insufficient volume or infrequent transactions (less active markets), or model-driven valuations in which all significant inputs are observable or can be derived principally from, or corroborated with, observable market data.
|
Level 3
- Fair value is derived from valuation techniques in which one or more significant inputs are unobservable, including assumptions and judgments made by us.
|
|
December 30, 2016
|
||||||||||||||
|
Fair Value
|
|
Active Markets for Identical Assets (Level 1)
|
|
Observable Inputs (Level 2)
|
|
Unobservable Inputs (Level 3)
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
1,182
|
|
|
$
|
1,182
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Commercial Paper
|
106,086
|
|
|
—
|
|
|
106,086
|
|
|
—
|
|
||||
Agency bonds
|
2,998
|
|
|
—
|
|
|
2,998
|
|
|
—
|
|
||||
Corporate bonds
|
14,788
|
|
|
—
|
|
|
14,788
|
|
|
—
|
|
||||
Total assets measured at fair value
|
$
|
125,054
|
|
|
$
|
1,182
|
|
|
$
|
123,872
|
|
|
$
|
—
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Contingent consideration
|
$
|
866
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
866
|
|
Common stock warrant liability
|
43,076
|
|
|
—
|
|
|
—
|
|
|
43,076
|
|
||||
Total liabilities measured at fair value
|
$
|
43,942
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
43,942
|
|
|
September 30, 2016
|
||||||||||||||
|
Fair Value
|
|
Active Markets for Identical Assets (Level 1)
|
|
Observable Inputs (Level 2)
|
|
Unobservable Inputs (Level 3)
|
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
1,172
|
|
|
$
|
1,172
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Commercial Paper
|
102,928
|
|
|
—
|
|
|
102,928
|
|
|
—
|
|
||||
US treasuries and agency bonds
|
6,002
|
|
|
—
|
|
|
6,002
|
|
|
—
|
|
||||
Corporate bonds
|
14,799
|
|
|
—
|
|
|
14,799
|
|
|
—
|
|
||||
Total assets measured at fair value
|
$
|
124,901
|
|
|
$
|
1,172
|
|
|
$
|
123,729
|
|
|
$
|
—
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Contingent consideration
|
$
|
848
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
848
|
|
Common stock warrant liability
|
38,253
|
|
|
—
|
|
|
—
|
|
|
38,253
|
|
||||
Total liabilities measured at fair value
|
$
|
39,101
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
39,101
|
|
|
|
|
|
|
Inputs
|
||
Liabilities
|
Valuation Technique
|
|
Unobservable Input
|
|
December 30, 2016
|
|
September 30, 2016
|
Contingent consideration
|
Discounted cash flow
|
|
Discount rate
|
|
12.9%
|
|
12.9%
|
|
|
|
Probability of achievement
|
|
75% - 100%
|
|
75%
|
|
|
|
Timing of cash flows
|
|
8 months
|
|
1 year
|
|
|
|
|
|
|
|
|
Warrant liability
|
Black-scholes model
|
|
Volatility
|
|
40.4%
|
|
43.2%
|
|
|
|
Discount rate
|
|
1.70%
|
|
1.14%
|
|
|
|
Expected life
|
|
3.98 years
|
|
4.23 years
|
|
|
|
Exercise price
|
|
$14.05
|
|
$14.05
|
|
September 30,
2016 |
|
Net Realized/Unrealized Losses Included in Earnings
|
|
Purchases
and
Issuances
|
|
Sales and
Settlements
|
|
Transfers in
and/or (out)
of Level 3
|
|
December 30,
2016 |
||||||||||||
Contingent consideration
|
$
|
848
|
|
|
$
|
18
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
866
|
|
Common stock warrant liability
|
$
|
38,253
|
|
|
$
|
4,823
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
43,076
|
|
|
October 2,
2015 |
|
Net Realized/Unrealized Losses Included in Earnings
|
|
Purchases
and
Issuances
|
|
Sales and
Settlements
|
|
Transfers in
and/or (out)
of Level 3
|
|
January 1,
2016 |
||||||||||||
Contingent consideration
|
$
|
1,150
|
|
|
$
|
20
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,170
|
|
Common stock warrant liability
|
$
|
21,822
|
|
|
$
|
14,878
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
36,700
|
|
|
December 30,
2016 |
|
September 30,
2016 |
||||
Raw materials
|
$
|
64,120
|
|
|
$
|
67,378
|
|
Work-in-process
|
8,864
|
|
|
9,157
|
|
||
Finished goods
|
42,235
|
|
|
38,400
|
|
||
Total
|
$
|
115,219
|
|
|
$
|
114,935
|
|
|
December 30,
2016 |
|
September 30,
2016 |
||||
Land, buildings and improvements
|
$
|
16,618
|
|
|
$
|
12,572
|
|
Construction in process
|
10,341
|
|
|
9,415
|
|
||
Machinery and equipment
|
132,928
|
|
|
129,639
|
|
||
Leasehold improvements
|
12,177
|
|
|
12,152
|
|
||
Furniture and fixtures
|
1,529
|
|
|
1,469
|
|
||
Computer equipment and software
|
13,042
|
|
|
12,954
|
|
||
Total property and equipment
|
$
|
186,635
|
|
|
$
|
178,201
|
|
Less accumulated depreciation and amortization
|
(84,790
|
)
|
|
(79,034
|
)
|
||
Property and equipment, net
|
$
|
101,845
|
|
|
$
|
99,167
|
|
Principal balance
|
$
|
589,974
|
|
Unamortized discount
|
(3,830
|
)
|
|
Total term loans
|
$
|
586,144
|
|
Current portion
|
6,051
|
|
|
Long-term, less current portion
|
$
|
580,093
|
|
2017 (rest of fiscal year)
|
$
|
4,538
|
|
2018
|
6,051
|
|
|
2019
|
6,051
|
|
|
2020
|
6,051
|
|
|
2021
|
567,283
|
|
|
Total
|
$
|
589,974
|
|
Fiscal year ending:
|
|
Amount
|
||
2017
|
|
$
|
1,694
|
|
2018
|
|
1,900
|
|
|
2019
|
|
1,795
|
|
|
2020
|
|
1,622
|
|
|
2021
|
|
1,487
|
|
|
Thereafter
|
|
20,541
|
|
|
Total minimum capital lease obligation payments
|
|
$
|
29,039
|
|
|
Three Months Ended
|
||||||
|
December 30,
2016 |
|
January 1,
2016 |
||||
Cost of revenue
|
$
|
6,001
|
|
|
$
|
7,167
|
|
Selling, general and administrative
|
6,467
|
|
|
4,423
|
|
||
Total
|
$
|
12,468
|
|
|
$
|
11,590
|
|
|
December 30,
2016 |
|
September 30,
2016 |
||||
Acquired technology
|
$
|
164,173
|
|
|
$
|
165,397
|
|
Customer relationships
|
202,697
|
|
|
207,674
|
|
||
In-process research and development
|
8,000
|
|
|
8,000
|
|
||
Trade name
|
3,400
|
|
|
3,400
|
|
||
Total
|
$
|
378,270
|
|
|
$
|
384,471
|
|
Less accumulated amortization
|
(137,337
|
)
|
|
(124,869
|
)
|
||
Intangible assets — net
|
$
|
240,933
|
|
|
$
|
259,602
|
|
|
Total
|
|
Acquired
Technology
|
|
Customer
Relationships |
|
In-Process Research and Development
|
|
Trade Name
|
|
Goodwill
|
||||||||||||
Balance at September 30, 2016
|
$
|
504,495
|
|
|
$
|
165,397
|
|
|
$
|
207,674
|
|
|
$
|
8,000
|
|
|
$
|
3,400
|
|
|
$
|
120,024
|
|
Fair value adjustment
|
220
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
220
|
|
||||||
Currency translation adjustment
|
(8,363
|
)
|
|
(1,224
|
)
|
|
(4,977
|
)
|
|
—
|
|
|
—
|
|
|
(2,162
|
)
|
||||||
Balance at December 30, 2016
|
$
|
496,352
|
|
|
$
|
164,173
|
|
|
$
|
202,697
|
|
|
$
|
8,000
|
|
|
$
|
3,400
|
|
|
$
|
118,082
|
|
|
2017 Remaining
|
2018
|
2019
|
2020
|
2021
|
Thereafter
|
Total
|
|||||||||
Amortization expense
|
$
|
38,413
|
|
47,499
|
|
40,891
|
|
32,997
|
|
26,900
|
|
42,833
|
|
$
|
229,533
|
|
Balance at September 30, 2016
|
$
|
38,253
|
|
Change in estimated fair value
|
4,823
|
|
|
Balance at December 30, 2016
|
$
|
43,076
|
|
|
Three Months Ended
|
||||||
|
December 30, 2016
|
|
January 1, 2016
|
||||
Numerator:
|
|
|
|
||||
Loss from continuing operations
|
$
|
(2,171
|
)
|
|
$
|
(16,770
|
)
|
Income from discontinued operations
|
1,206
|
|
|
1,199
|
|
||
Net loss
|
$
|
(965
|
)
|
|
$
|
(15,571
|
)
|
Net loss attributable to common stockholders
|
$
|
(965
|
)
|
|
$
|
(15,571
|
)
|
Denominator:
|
|
|
|
||||
Weighted average common shares outstanding-basic
|
53,737
|
|
|
53,015
|
|
||
Dilutive effect of options and warrants
|
—
|
|
|
—
|
|
||
Weighted average common shares outstanding-diluted
|
$
|
53,737
|
|
|
$
|
53,015
|
|
Common stock (loss) earnings per share-basic:
|
|
|
|
||||
Continuing operations
|
$
|
(0.04
|
)
|
|
$
|
(0.32
|
)
|
Discontinued operations
|
0.02
|
|
|
0.02
|
|
||
Net common stock loss per share-basic
|
$
|
(0.02
|
)
|
|
$
|
(0.29
|
)
|
Common stock (loss) earnings per share-diluted:
|
|
|
|
||||
Continuing operations
|
$
|
(0.04
|
)
|
|
$
|
(0.32
|
)
|
Discontinued operations
|
0.02
|
|
|
0.02
|
|
||
Net common stock loss per share-diluted
|
$
|
(0.02
|
)
|
|
$
|
(0.29
|
)
|
Balance as of September 30, 2016
|
$
|
3,104
|
|
Current period adjustments
|
1,287
|
|
|
Payments
|
(2,346
|
)
|
|
Balance as of December 30, 2016
|
$
|
2,045
|
|
|
Three Months Ended
|
||||||
|
December 30,
2016 |
|
January 1,
2016 |
||||
Cost of revenue
|
$
|
720
|
|
|
$
|
457
|
|
Research and development
|
1,945
|
|
|
1,837
|
|
||
Selling, general and administrative
|
5,518
|
|
|
5,088
|
|
||
Total share-based compensation expense
|
$
|
8,183
|
|
|
$
|
7,382
|
|
|
Number of RSUs
|
|
Weighted-
Average
Grate Date Fair Value
|
|
Aggregate
Intrinsic
Value
(in thousands)
|
|||||
Balance at September 30, 2016
|
1,707,695
|
|
|
$
|
32.76
|
|
|
$
|
72,165
|
|
Granted
|
208,505
|
|
|
41.38
|
|
|
|
|||
Vested and released
|
(27
|
)
|
|
15.14
|
|
|
|
|||
Forfeited, canceled or expired
|
(13,927
|
)
|
|
37.02
|
|
|
|
|||
Balance at December 30, 2016
|
1,902,246
|
|
|
$
|
33.68
|
|
|
$
|
87,884
|
|
|
Three Months Ended
|
||||||
|
December 30,
2016 |
|
January 1,
2016 |
||||
Cash paid for interest
|
$
|
5,426
|
|
|
$
|
4,120
|
|
Cash (refunded) paid for income taxes
|
$
|
(712
|
)
|
|
$
|
611
|
|
|
Three Months Ended
|
||||||
Revenue by Geographic Region
|
December 30,
2016 |
|
January 1,
2016 |
||||
United States
|
$
|
43,961
|
|
|
$
|
34,482
|
|
China
|
47,477
|
|
|
30,719
|
|
||
Asia Pacific, excluding China (1)
|
49,753
|
|
|
41,733
|
|
||
Other Countries (2)
|
10,561
|
|
|
8,840
|
|
||
Total
|
$
|
151,752
|
|
|
$
|
115,774
|
|
|
|
As of
|
||||||
Long-Lived Assets by Geographic Region
|
|
December 30,
2016 |
|
September 30,
2016 |
||||
United States
|
|
$
|
83,085
|
|
|
$
|
79,832
|
|
Asia Pacific (1)
|
|
15,895
|
|
|
16,614
|
|
||
Other Countries (2)
|
|
2,865
|
|
|
2,721
|
|
||
Total
|
|
$
|
101,845
|
|
|
$
|
99,167
|
|
(1)
|
Asia Pacific represents Taiwan, Hong Kong, Japan, Singapore, India, Thailand, South Korea, Australia, Malaysia and the Philippines.
|
(2)
|
No international country or region represented greater than 10% of the total net long-lived assets or revenue as of the dates presented, other than the Asia-Pacific region as presented above.
|
Accounts Receivable
|
December 30,
2016 |
|
September 30,
2016 |
||
Customer A
|
19
|
%
|
|
11
|
%
|
Customer B
|
15
|
%
|
|
11
|
%
|
Customer C
|
14
|
%
|
|
16
|
%
|
ITEM 2.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
•
|
engaging early with our lead customers to develop products and solutions that can be driven across multiple growth markets;
|
•
|
leveraging our core strength and leadership position in standard, catalog products that service all of our end applications;
|
•
|
increasing content of our semiconductor solutions in our customers’ systems through cross-selling of our more than 40 product lines;
|
•
|
introducing new products through internal development and acquisitions with market reception that command higher prices based on the application of advanced technologies such as GaN, added features, higher levels of integration and improved performance; and
|
•
|
continued growth in the market for high-performance analog and optical semiconductors in our three primary markets in particular.
|
|
Three Months Ended
|
||||||
|
December 30,
2016 |
|
January 1,
2016 |
||||
Revenue
|
$
|
151,752
|
|
|
$
|
115,774
|
|
Cost of revenue (1)
|
73,257
|
|
|
55,456
|
|
||
Gross profit
|
$
|
78,495
|
|
|
$
|
60,318
|
|
Operating expenses:
|
|
|
|
||||
Research and development (1)
|
30,174
|
|
|
25,322
|
|
||
Selling, general and administrative (1) (2)
|
36,496
|
|
|
34,686
|
|
||
Restructuring charges
|
1,287
|
|
|
157
|
|
||
Total operating expenses
|
$
|
67,957
|
|
|
$
|
60,165
|
|
Income from operations
|
$
|
10,538
|
|
|
$
|
153
|
|
Other (expense) income
|
|
|
|
||||
Warrant liability expense (3)
|
(4,823
|
)
|
|
(14,878
|
)
|
||
Interest expense
|
(7,350
|
)
|
|
(4,346
|
)
|
||
Other (expense) income
|
(4
|
)
|
|
100
|
|
||
Total other expense, net
|
$
|
(12,177
|
)
|
|
$
|
(19,124
|
)
|
Loss before income taxes
|
(1,639
|
)
|
|
(18,971
|
)
|
||
Income tax expense (benefit)
|
532
|
|
|
(2,201
|
)
|
||
Loss from continuing operations
|
$
|
(2,171
|
)
|
|
$
|
(16,770
|
)
|
Income from discontinued operations (4)
|
1,206
|
|
|
1,199
|
|
||
Net loss
|
$
|
(965
|
)
|
|
$
|
(15,571
|
)
|
(1)
|
Includes (a) Amortization expense related to intangible assets arising from acquisitions and (b) Stock-based compensation expense included in our consolidated statements of operations as set forth below (in thousands):
|
|
Three Months Ended
|
||||||
|
December 30,
2016 |
|
January 1,
2016 |
||||
(a) Intangible amortization expense:
|
|
|
|
||||
Cost of revenue
|
$
|
6,001
|
|
|
$
|
7,167
|
|
Selling, general and administrative
|
6,467
|
|
|
4,423
|
|
||
(b) Stock-based compensation expense:
|
|
|
|
||||
Cost of revenue
|
$
|
720
|
|
|
$
|
457
|
|
Research and development
|
1,945
|
|
|
1,837
|
|
||
Selling, general and administrative
|
5,518
|
|
|
5,088
|
|
|
|
Three Months Ended
|
||||||
|
|
December 30, 2016
|
|
January 1, 2016
|
||||
Cash and cash equivalents, beginning of period
|
|
$
|
332,977
|
|
|
$
|
122,312
|
|
Net cash provided by operating activities
|
|
20,407
|
|
|
15,514
|
|
||
Net cash used in investing activities
|
|
(4,043
|
)
|
|
(82,680
|
)
|
||
Net cash provided by (used in) financing activities
|
|
5,011
|
|
|
(7,128
|
)
|
||
Foreign currency effect on cash
|
|
(435
|
)
|
|
(210
|
)
|
||
Cash and cash equivalents, end of period
|
|
$
|
353,917
|
|
|
$
|
47,808
|
|
•
|
changes in environmental or health and safety laws or regulations;
|
•
|
the manner in which environmental or health and safety laws or regulations will be enforced, administered or interpreted;
|
•
|
our ability to enforce and collect under any indemnity agreements and insurance policies relating to environmental liabilities; or,
|
•
|
the cost of compliance with future environmental or health and safety laws or regulations or the costs associated with any future environmental claims, including the cost of clean-up of currently unknown environmental conditions.
|
Period
|
Total Number of Shares (or Units) Purchased (1)
|
|
Average Price Paid per Share (or Unit)
|
|
Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs
|
|
Maximum Number that May Yet Be Purchased Under the Plans or Programs
|
|||||
October 1, 2016 - October 28, 2016
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
—
|
|
October 29, 2016 - November 25, 2016
|
7
|
|
|
41.51
|
|
|
—
|
|
|
—
|
|
|
November 26, 2016 - December 30, 2016
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
7
|
|
|
$
|
—
|
|
|
—
|
|
|
—
|
|
(1)
|
We employ “withhold to cover” as a tax payment method for vesting of restricted stock awards for our employees, pursuant to which, we withheld from employees the shares noted in the table above to cover tax withholding related to the vesting of their awards. The average prices listed in the above table are averages of the fair market prices at which we valued shares withheld for purposes of calculating the number of shares to be withheld.
|
Exhibit
Number
|
Description
|
2.1
|
Agreement and Plan of Merger and Reorganization, dated as of November 21, 2016, by and among MACOM Technology Solutions Holdings, Inc., Montana Merger Sub I, Inc., MACOM Connectivity Solutions, LLC (f/k/a Montana Merger Sub II, LLC) and Applied Micro Circuits Corporation (incorporated by reference to Exhibit 2.1 to our Current Report on Form 8-K filed on November 21, 2016).
|
3.1
|
Fifth Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to our Current Report on Form 8-K filed on June 2, 2016).
|
3.2
|
Third Amended and Restated Bylaws (incorporated by reference to Exhibit 3.2 to our Current Report on Form 8-K filed on June 2, 2016).
|
10.1
|
First, Second and Third Amendments to Purchase And Sale Agreement and Escrow Instructions by and between MACOM Technology Solutions Inc. and Calare Properties, Inc. dated July 22, 2016, September 20, 2016 and September 22, 2016, respectively (incorporated by reference to Exhibit 10.23 to our Annual Report on Form 10-K filed on November 17, 2016).
|
10.2
|
Lease Agreement for 100 Chelmsford Street by and between MACOM Technology Solutions Holdings, Inc., CPI 100 Chelmsford, LLC and CPI 144 Chelmsford, LLC, dated December 28, 2016 (incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed on January 5, 2017).
|
10.3
|
Lease Agreement for 144 Chelmsford Street by and between MACOM Technology Solutions Holdings, Inc., CPI 100 Chelmsford, LLC and CPI 144 Chelmsford, LLC, dated December 28, 2016 (incorporated by reference to Exhibit 10.2 to our Current Report on Form 8-K filed on January 5, 2017).
|
31.1
|
Certification of Principal Executive Officer Required Under Rule 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as amended.
|
31.2
|
Certification of Principal Financial Officer Required Under Rule 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as amended.
|
32.1
|
Certification of Principal Executive Officer and Principal Financial Officer Required Under Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended, and 18 U.S.C. §1350.
|
99.1
|
Form of Support Agreement (incorporated by reference to Exhibit 99.1 to our Current Report on Form 8-K filed on November 21, 2016).
|
101.INS
|
XBRL Instance Document
|
101.SCH
|
XBRL Taxonomy Schema Document
|
101.CAL
|
XBRL Taxonomy Calculation Linkbase Document
|
101.DEF
|
XBRL Taxonomy Definition Linkbase Document
|
101.LAB
|
XBRL Taxonomy Label Linkbase Document
|
101.PRE
|
XBRL Taxonomy Presentation Linkbase Document
|
|
MACOM TECHNOLOGY SOLUTIONS HOLDINGS, INC.
|
|
Dated: February 1, 2017
|
By:
|
/s/John Croteau
|
|
|
John Croteau
|
|
|
President and Chief Executive Officer
(Principal Executive Officer)
|
|
|
|
Dated: February 1, 2017
|
By:
|
/s/Robert J. McMullan
|
|
|
Robert J. McMullan
|
|
|
Senior Vice President and Chief Financial Officer
(Principal Financial Officer)
|
1 Year MACOM Technology Solutions Chart |
1 Month MACOM Technology Solutions Chart |
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