Discontinued Operations excluding consulting income - includes the profit and loss amounts of discontinued operations, with the exception of consulting income associated with a consulting agreement we entered into at the time of our Automotive business divestiture. We believe excluding gains and losses associated with historically divested businesses from our net income provides management with a comparable basis to our current ongoing operating activities. We do not exclude the consulting agreement income classified as discontinued operations because management views this income as part of our ongoing operations and correlated with future operations.
Other - historical amounts are primarily associated with the impairment of a minority investment of $3.5 million during the second fiscal quarter of 2015 as well as income associated with transition service agreements entered in connection with divested businesses. We believe these amounts are not correlated to future business operations and including such charges does not reflect our ongoing operations.
Tax Effect of Non-GAAP Adjustments - adjustments to arrive at an estimate of our Adjusted Non-GAAP cash tax rate associated with our Adjusted Non-GAAP income over a period of time. These adjustments have resulted in an estimated Adjusted Non-GAAP cash tax rate of 15% for our fiscal years 2016 and 2015, respectively. We believe it is beneficial for our management to review Adjusted Non-GAAP cash tax rate on a consistent basis over periods of time. Certain items including many of the items noted above may have a significant impact on our US GAAP tax expense and associated tax rate during a specific period of time.
Adjusted EBITDA - is a calculation that adds depreciation expense and consulting agreement income to our Adjusted Non-GAAP Income from Operations. Adjusted EBITDA is a measure that management reviews and utilizes for operational analysis purposes. We believe competitors and others in the financial industry utilize this Non-GAAP measure for analysis purposes.
Free Cash Flow - is a calculation that starts with cash flow from operating activities and reduces this amount by our capital expenditures in the applicable period. Free Cash Flow is a measure that management reviews and utilizes for cash flow analysis purposes. We believe competitors and others in the financial industry utilize this Non-GAAP measure for analyzing a company's cash flow.
MACOM TECHNOLOGY SOLUTIONS HOLDINGS, INC. |
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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
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(unaudited and in thousands, except per share data) |
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Three Months Ended | Fiscal Year Ended | ||||||||||||||||||||||||
September 30, | July 1, | October 2, | September 30, | October 2, | |||||||||||||||||||||
2016 | 2016 | 2015 | 2016 | 2015 | |||||||||||||||||||||
Revenue | $ | 152,697 | $ | 142,288 | $ | 112,564 | $ | 544,338 | $ | 420,609 | |||||||||||||||
Cost of revenue | 70,893 | 68,326 | 55,603 | 262,729 | 217,019 | ||||||||||||||||||||
Gross profit | 81,804 | 73,962 | 56,961 | 281,609 | 203,590 | ||||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||||
Research and development | 30,109 | 26,064 | 22,002 | 107,698 | 82,188 | ||||||||||||||||||||
Selling, general and administrative | 40,265 | 35,866 | 29,964 | 145,433 | 110,030 | ||||||||||||||||||||
Impairment charges | — | 760 | — | 11,765 | — | ||||||||||||||||||||
Restructuring charges | 1,365 | 1,092 | 308 | 3,465 | 1,280 | ||||||||||||||||||||
Total operating expenses | 71,739 | 63,782 | 52,274 | 268,361 | 193,498 | ||||||||||||||||||||
Income from operations | 10,065 | 10,180 | 4,687 | 13,248 | 10,092 | ||||||||||||||||||||
Other income (expense): | |||||||||||||||||||||||||
Warrant liability gain (expense) | (12,691 | ) | 15,339 | 9,651 | (16,431 | ) | (6,020 | ) | |||||||||||||||||
Interest expense, net | (5,310 | ) | (4,363 | ) | (4,425 | ) | (18,427 | ) | (18,376 | ) | |||||||||||||||
Other income (expense), net | 5 | 16 | 131 | 39 | (1,096 | ) | |||||||||||||||||||
Total other (expense) income | (17,996 | ) | 10,992 | 5,357 | (34,819 | ) | (25,492 | ) | |||||||||||||||||
(Loss) income before income taxes | (7,931 | ) | 21,172 | 10,044 | (21,571 | ) | (15,400 | ) | |||||||||||||||||
Income tax benefit | (11,804 | ) | (181 | ) | (3,797 | ) | (17,983 | ) | (9,858 | ) | |||||||||||||||
Income (loss) from continuing operations | 3,873 | 21,353 | 13,841 | (3,588 | ) | (5,542 | ) | ||||||||||||||||||
Income from discontinued operations | 1,228 | 1,199 | 40,564 | 5,022 | 54,131 | ||||||||||||||||||||
Net income | $ | 5,101 | $ | 22,552 | $ | 54,405 | $ | 1,434 | $ | 48,589 | |||||||||||||||
Net income (loss) per share: | |||||||||||||||||||||||||
Basic: | |||||||||||||||||||||||||
Income (loss) from continuing operations | $ | 0.07 | $ | 0.40 | $ | 0.26 | $ | (0.07 | ) | $ | (0.11 | ) | |||||||||||||
Income from discontinued operations | 0.02 | 0.02 | 0.76 | 0.09 | 1.06 | ||||||||||||||||||||
Income per share - basic | $ | 0.10 | $ | 0.42 | $ | 1.02 | $ | 0.03 | $ | 0.95 | |||||||||||||||
Diluted: | |||||||||||||||||||||||||
Income (loss) from continuing operations | $ | 0.07 | $ | 0.11 | $ | 0.08 | $ | (0.07 | ) | $ | (0.11 | ) | |||||||||||||
Income from discontinued operations | 0.02 | 0.02 | 0.74 | 0.09 | 1.06 | ||||||||||||||||||||
Income per share - diluted | $ | 0.09 | $ | 0.13 | $ | 0.81 | $ | 0.03 | $ | 0.95 | |||||||||||||||
Shares - Basic | 53,676 | 53,516 | 53,287 | 53,364 | 51,146 | ||||||||||||||||||||
Shares - Diluted | 55,285 | 55,288 | 54,991 | 53,364 | 51,146 | ||||||||||||||||||||