- Stock-based compensation;
- Flow-through of business acquisition-related inventory adjustments;
- Acquisition-related costs;
- Employee severance;
- Gains and losses from settlements and patent license charges;
- Restructure and asset impairments;
- Amortization of debt discount and other costs;
- Gains and losses from debt repurchases and conversions;
- Gains and losses from business acquisition activities;
- Initial impact of inventory accounting policy change to FIFO and change in inventory cost absorption in the second quarter of 2021; and
- The estimated tax effects of above, non-cash changes in net deferred income taxes, assessments of tax exposures, certain tax matters related to prior fiscal periods, and significant changes in tax law.
Non-GAAP diluted shares are adjusted for the impact of additional shares resulting from the exclusion of stock-based compensation from non-GAAP income.
MICRON TECHNOLOGY, INC.
RECONCILIATION OF GAAP TO NON-GAAP OUTLOOK
| FQ3-22 | GAAP Outlook | Adjustments | Non-GAAP Outlook | ||||||
| Revenue | $8.7 billion ± $200 million | — | $8.7 billion ± $200 million | ||||||
| Gross margin | 47.0% ± 1% | 1% | A | 48.0% ± 1% | |||||
| Operating expenses | $1.13 billion ± $25 million | $80 million | B | $1.05 billion ± $25 million | |||||
| Diluted earnings per share(1) | $2.33 ± $0.10 | $0.13 | A, B, C | $2.46 ± $0.10 | |||||
|
Non-GAAP Adjustments
(in millions) | ||||||||
| A | Stock-based compensation – cost of goods sold | $ | 56 | |||||
| A | Other – cost of goods sold | 5 | ||||||
| B | Stock-based compensation – research and development | 47 | ||||||
| B | Stock-based compensation – sales, general, and administrative | 33 | ||||||
| C | Tax effects of the above items and other tax adjustments | 1 | ||||||
| $ | 142 | |||||||
| (1) | GAAP earnings per share based on approximately 1.13 billion diluted shares and non-GAAP earnings per share based on approximately 1.14 billion diluted shares. | |||||||
The tables above reconcile our GAAP to non-GAAP guidance based on the current outlook. The guidance does not incorporate the impact of any potential business combinations, divestitures, restructuring activities, balance sheet valuation adjustments, strategic investments, financing transactions, and other significant transactions. The timing and impact of such items are dependent on future events that may be uncertain or outside of our control.
