CONEXANT SYSTEMS, INC.
Reconciliation of GAAP Financial Measures
to Non-GAAP Core Financial Measures
(unaudited, in thousands, except per share amounts)
Fiscal Quarter Ended
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December 28, September 28, December 29,
2007 2007 2006
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GAAP gross margin $ 99,271 $ 80,948 $109,489
Stock-based compensation (a) 114 112 103
Other (f) -- 1,211 --
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Non-GAAP Core gross margin 99,385 82,271 109,592
Royalty buyout (l) (14,700) -- --
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Non-GAAP Core gross margin
less impact of royalty buyout $ 84,685 $ 82,271 $109,592
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GAAP operating expenses $ 94,186 $ 319,158 $108,062
Stock-based compensation (a) (3,170) (4,632) (4,234)
Transitional salaries and
benefits (b) -- (620) (740)
Amortization of intangible
assets (c) (4,781) (4,784) (6,238)
Asset impairments (d) (130) (192,498) --
Special charges (e) (5,784) (26,359) (2,898)
Other (f) -- -- (400)
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Non-GAAP Core operating
expenses $ 80,321 $ 90,265 $ 93,552
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GAAP operating income (loss) $ 5,085 $(238,210) $ 1,427
Gross margin adjustment (a) 114 1,323 103
Operating expense
adjustments (a-f) 13,865 228,893 14,510
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Non-GAAP Core operating income
(loss) 19,064 (7,994) 16,040
Royalty buyout (l) (14,700) -- --
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Non-GAAP Core operating income
(loss) less impact of royalty
buyout $ 4,364 $ (7,994) $ 16,040
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GAAP net (loss) income $ (9,218) $(234,765) $ 976
Gross margin adjustments (a,
f) 114 1,323 103
Operating expense
adjustments (a-f) 13,865 228,893 14,510
(Gains) losses of equity
method investments (g) (3,773) (6,988) (4,696)
Unrealized losses (gains) on
Mindspeed warrant (h) 8,364 8,820 (3,042)
Gains on sales of equity
securities (i) -- (10,446) (431)
Other (j) -- (5,324) --
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Non-GAAP Core net income
(loss) $ 9,352 $ (18,487) $ 7,420
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Basic (loss) per share:
GAAP $ (0.02) $ (0.48) $ 0.00
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Non-GAAP Core $ 0.02 $ (0.04) $ 0.02
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Diluted net income (loss) per
share:
GAAP $ (0.02) $ (0.48) $ 0.00
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Non-GAAP Core (k) $ 0.02 $ (0.03) $ 0.02
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See "GAAP to Non-GAAP Core Adjustments" below
