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|
|
x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
|
|
00-0000000
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(State or Other Jurisdiction of
Incorporation or Organization)
|
|
(I.R.S. Employer
Identification No.)
|
|
|
|
2655 Seely Avenue, Building 5, San Jose, California
|
|
95134
|
(Address of Principal Executive Offices)
|
|
(Zip Code)
|
Large accelerated filer
|
|
x
|
|
Accelerated filer
|
|
o
|
|
|
|
|
|||
Non-accelerated filer
|
|
¨
(Do not check if a smaller reporting company)
|
|
Smaller reporting company
|
|
o
|
|
|
Page
|
PART I.
|
FINANCIAL INFORMATION
|
|
|
|
|
Item 1.
|
|
|
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
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|
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Item 2.
|
||
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|
|
Item 3.
|
||
|
|
|
Item 4.
|
||
|
|
|
PART II.
|
OTHER INFORMATION
|
|
|
|
|
Item 1.
|
||
|
|
|
Item 1A.
|
||
|
|
|
Item 2.
|
||
|
|
|
Item 3.
|
||
|
|
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Item 4.
|
||
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|
|
Item 5.
|
||
|
|
|
Item 6.
|
||
|
|
|
|
|
As of
|
||||||
|
July 4,
2015 |
|
January 3,
2015 |
||||
ASSETS
|
|||||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
647,851
|
|
|
$
|
932,161
|
|
Short-term investments
|
96,560
|
|
|
90,445
|
|
||
Receivables, net
|
131,325
|
|
|
122,492
|
|
||
Inventories
|
62,172
|
|
|
56,394
|
|
||
2015 notes hedges
|
—
|
|
|
523,930
|
|
||
Prepaid expenses and other
|
129,320
|
|
|
126,313
|
|
||
Total current assets
|
1,067,228
|
|
|
1,851,735
|
|
||
Property, plant and equipment, net of accumulated depreciation of $569,202 and $552,551, respectively
|
229,838
|
|
|
230,112
|
|
||
Goodwill
|
553,831
|
|
|
553,767
|
|
||
Acquired intangibles, net of accumulated amortization of $185,382 and $154,814, respectively
|
328,338
|
|
|
360,932
|
|
||
Long-term receivables
|
1,628
|
|
|
3,644
|
|
||
Other assets
|
199,790
|
|
|
209,366
|
|
||
Total assets
|
$
|
2,380,653
|
|
|
$
|
3,209,556
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|||||||
Current liabilities:
|
|
|
|
||||
Convertible notes
|
$
|
—
|
|
|
$
|
342,499
|
|
2015 notes embedded conversion derivative
|
—
|
|
|
523,930
|
|
||
Accounts payable and accrued liabilities
|
202,794
|
|
|
225,375
|
|
||
Current portion of deferred revenue
|
324,569
|
|
|
301,287
|
|
||
Total current liabilities
|
527,363
|
|
|
1,393,091
|
|
||
Long-term liabilities:
|
|
|
|
||||
Long-term portion of deferred revenue
|
36,402
|
|
|
54,726
|
|
||
Long-term debt
|
348,733
|
|
|
348,676
|
|
||
Other long-term liabilities
|
70,940
|
|
|
79,489
|
|
||
Total long-term liabilities
|
456,075
|
|
|
482,891
|
|
||
Commitments and contingencies (Note 11)
|
|
|
|
|
|
||
Stockholders’ equity:
|
|
|
|
||||
Common stock and capital in excess of par value
|
1,886,421
|
|
|
1,851,427
|
|
||
Treasury stock, at cost
|
(256,476
|
)
|
|
(203,792
|
)
|
||
Accumulated deficit
|
(231,989
|
)
|
|
(326,408
|
)
|
||
Accumulated other comprehensive income (loss)
|
(741
|
)
|
|
12,347
|
|
||
Total stockholders’ equity
|
1,397,215
|
|
|
1,333,574
|
|
||
Total liabilities and stockholders’ equity
|
$
|
2,380,653
|
|
|
$
|
3,209,556
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
July 4,
2015 |
|
June 28,
2014 |
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
Product and maintenance
|
$
|
384,951
|
|
|
$
|
354,468
|
|
|
$
|
768,588
|
|
|
$
|
711,818
|
|
Services
|
30,932
|
|
|
24,320
|
|
|
58,661
|
|
|
45,520
|
|
||||
Total revenue
|
415,883
|
|
|
378,788
|
|
|
827,249
|
|
|
757,338
|
|
||||
Costs and expenses:
|
|
|
|
|
|
|
|
||||||||
Cost of product and maintenance
|
31,715
|
|
|
37,707
|
|
|
73,774
|
|
|
79,904
|
|
||||
Cost of services
|
20,040
|
|
|
16,706
|
|
|
38,566
|
|
|
31,608
|
|
||||
Marketing and sales
|
96,662
|
|
|
98,611
|
|
|
196,930
|
|
|
196,934
|
|
||||
Research and development
|
157,974
|
|
|
152,672
|
|
|
320,970
|
|
|
299,138
|
|
||||
General and administrative
|
27,467
|
|
|
32,042
|
|
|
55,109
|
|
|
60,786
|
|
||||
Amortization of acquired intangibles
|
6,119
|
|
|
5,579
|
|
|
12,350
|
|
|
10,789
|
|
||||
Restructuring and other charges (credits)
|
(498
|
)
|
|
(26
|
)
|
|
3,861
|
|
|
370
|
|
||||
Total costs and expenses
|
339,479
|
|
|
343,291
|
|
|
701,560
|
|
|
679,529
|
|
||||
Income from operations
|
76,404
|
|
|
35,497
|
|
|
125,689
|
|
|
77,809
|
|
||||
Interest expense
|
(8,180
|
)
|
|
(7,369
|
)
|
|
(19,934
|
)
|
|
(14,637
|
)
|
||||
Other income, net
|
1,347
|
|
|
1,635
|
|
|
6,128
|
|
|
5,017
|
|
||||
Income before provision for income taxes
|
69,571
|
|
|
29,763
|
|
|
111,883
|
|
|
68,189
|
|
||||
Provision for income taxes
|
11,411
|
|
|
6,500
|
|
|
17,464
|
|
|
11,856
|
|
||||
Net income
|
$
|
58,160
|
|
|
$
|
23,263
|
|
|
$
|
94,419
|
|
|
$
|
56,333
|
|
Net income per share – basic
|
$
|
0.20
|
|
|
$
|
0.08
|
|
|
$
|
0.33
|
|
|
$
|
0.20
|
|
Net income per share – diluted
|
$
|
0.19
|
|
|
$
|
0.08
|
|
|
$
|
0.30
|
|
|
$
|
0.19
|
|
Weighted average common shares outstanding – basic
|
285,297
|
|
|
283,344
|
|
|
284,910
|
|
|
282,480
|
|
||||
Weighted average common shares outstanding – diluted
|
313,665
|
|
|
305,755
|
|
|
312,756
|
|
|
303,395
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
July 4,
2015 |
|
June 28,
2014 |
||||||||
Net income
|
$
|
58,160
|
|
|
$
|
23,263
|
|
|
$
|
94,419
|
|
|
$
|
56,333
|
|
Other comprehensive income (loss), net of tax effects:
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments
|
(4,528
|
)
|
|
2,377
|
|
|
(13,418
|
)
|
|
6,828
|
|
||||
Changes in unrealized holding gains or losses on available-for-sale securities, net of reclassification adjustment for realized gains and losses
|
(52
|
)
|
|
775
|
|
|
13
|
|
|
595
|
|
||||
Changes in defined benefit plan liabilities
|
26
|
|
|
(21
|
)
|
|
317
|
|
|
387
|
|
||||
Total other comprehensive income (loss), net of tax effects
|
(4,554
|
)
|
|
3,131
|
|
|
(13,088
|
)
|
|
7,810
|
|
||||
Comprehensive income
|
$
|
53,606
|
|
|
$
|
26,394
|
|
|
$
|
81,331
|
|
|
$
|
64,143
|
|
|
Six Months Ended
|
||||||
|
July 4,
2015 |
|
June 28,
2014 |
||||
Cash and cash equivalents at beginning of period
|
$
|
932,161
|
|
|
$
|
536,260
|
|
Cash flows from operating activities:
|
|
|
|
||||
Net income
|
94,419
|
|
|
56,333
|
|
||
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
58,963
|
|
|
53,609
|
|
||
Amortization of debt discount and fees
|
8,971
|
|
|
9,814
|
|
||
Stock-based compensation
|
43,564
|
|
|
37,941
|
|
||
Gain on investments, net
|
(1,590
|
)
|
|
(5,128
|
)
|
||
Deferred income taxes
|
7,097
|
|
|
4,778
|
|
||
Other non-cash items
|
1,142
|
|
|
3,694
|
|
||
Changes in operating assets and liabilities, net of effect of acquired businesses:
|
|
|
|
||||
Receivables
|
(8,078
|
)
|
|
5,336
|
|
||
Inventories
|
(6,243
|
)
|
|
(12,266
|
)
|
||
Prepaid expenses and other
|
(8,036
|
)
|
|
(13,602
|
)
|
||
Other assets
|
1,117
|
|
|
(1,273
|
)
|
||
Accounts payable and accrued liabilities
|
(20,653
|
)
|
|
(13,550
|
)
|
||
Deferred revenue
|
5,827
|
|
|
(23,740
|
)
|
||
Other long-term liabilities
|
(8,058
|
)
|
|
(4,983
|
)
|
||
Net cash provided by operating activities
|
168,442
|
|
|
96,963
|
|
||
Cash flows from investing activities:
|
|
|
|
||||
Purchases of available-for-sale securities
|
(59,516
|
)
|
|
(77,490
|
)
|
||
Proceeds from the sale of available-for-sale securities
|
37,586
|
|
|
54,601
|
|
||
Proceeds from the maturity of available-for-sale securities
|
15,600
|
|
|
23,799
|
|
||
Proceeds from the sale of long-term investments
|
2,293
|
|
|
—
|
|
||
Purchases of property, plant and equipment
|
(24,067
|
)
|
|
(17,715
|
)
|
||
Cash paid in business combinations and asset acquisitions, net of cash acquired
|
—
|
|
|
(163,685
|
)
|
||
Net cash used for investing activities
|
(28,104
|
)
|
|
(180,490
|
)
|
||
Cash flows from financing activities:
|
|
|
|
||||
Proceeds from revolving credit facility
|
—
|
|
|
100,000
|
|
||
Payment of convertible notes
|
(349,999
|
)
|
|
—
|
|
||
Payment of convertible notes embedded conversion derivative liability
|
(530,643
|
)
|
|
—
|
|
||
Proceeds from convertible notes hedges
|
530,643
|
|
|
—
|
|
||
Payment of acquisition-related contingent consideration
|
—
|
|
|
(1,835
|
)
|
||
Excess tax benefits from stock-based compensation
|
10,097
|
|
|
2,642
|
|
||
Proceeds from issuance of common stock
|
38,167
|
|
|
36,482
|
|
||
Stock received for payment of employee taxes on vesting of restricted stock
|
(15,814
|
)
|
|
(12,292
|
)
|
||
Payments for repurchases of common stock
|
(93,076
|
)
|
|
(25,032
|
)
|
||
Net cash provided by (used for) financing activities
|
(410,625
|
)
|
|
99,965
|
|
||
Effect of exchange rate changes on cash and cash equivalents
|
(14,023
|
)
|
|
4,718
|
|
||
Increase (decrease) in cash and cash equivalents
|
(284,310
|
)
|
|
21,156
|
|
||
Cash and cash equivalents at end of period
|
$
|
647,851
|
|
|
$
|
557,416
|
|
|
|
|
|
||||
Supplemental cash flow information:
|
|
|
|
||||
Cash paid for interest
|
$
|
12,006
|
|
|
$
|
4,831
|
|
Cash paid for taxes, net
|
$
|
16,373
|
|
|
$
|
10,231
|
|
Non-cash investing and financing activities:
|
|
|
|
||||
Available-for-sale securities received from customer
|
$
|
—
|
|
|
$
|
1,695
|
|
|
July 4, 2015
|
|
January 3, 2015
|
||||||||||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
|
Principal
|
|
Unamortized Discount
|
|
Carrying Value
|
|
Principal
|
|
Unamortized Discount
|
|
Carrying Value
|
||||||||||||
2015 Notes
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
349,999
|
|
|
$
|
(7,500
|
)
|
|
$
|
342,499
|
|
2024 Notes
|
350,000
|
|
|
(1,267
|
)
|
|
348,733
|
|
|
350,000
|
|
|
(1,324
|
)
|
|
348,676
|
|
||||||
Revolving credit facility
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total outstanding debt
|
$
|
350,000
|
|
|
$
|
(1,267
|
)
|
|
$
|
348,733
|
|
|
$
|
699,999
|
|
|
$
|
(8,824
|
)
|
|
$
|
691,175
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
July 4,
2015 |
|
June 28,
2014 |
||||||||
|
(In thousands, except percentages)
|
||||||||||||||
Effective interest rate
|
8.1
|
%
|
|
8.1
|
%
|
|
8.1
|
%
|
|
8.1
|
%
|
||||
Contractual interest expense
|
$
|
1,178
|
|
|
$
|
2,289
|
|
|
$
|
2,987
|
|
|
$
|
4,578
|
|
Amortization of debt discount
|
$
|
2,470
|
|
|
$
|
4,275
|
|
|
$
|
7,500
|
|
|
$
|
8,507
|
|
|
As of
|
||||||
|
July 4,
2015 |
|
January 3,
2015 |
||||
|
(In thousands)
|
||||||
Cash and cash equivalents
|
$
|
647,851
|
|
|
$
|
932,161
|
|
Short-term investments
|
96,560
|
|
|
90,445
|
|
||
Cash, cash equivalents and short-term investments
|
$
|
744,411
|
|
|
$
|
1,022,606
|
|
|
As of
|
||||||
|
July 4,
2015 |
|
January 3,
2015 |
||||
|
(In thousands)
|
||||||
Cash and interest bearing deposits
|
$
|
232,408
|
|
|
$
|
203,665
|
|
Money market funds
|
415,443
|
|
|
728,496
|
|
||
Total cash and cash equivalents
|
$
|
647,851
|
|
|
$
|
932,161
|
|
|
As of July 4, 2015
|
||||||||||||||
|
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Fair
Value
|
||||||||
|
(In thousands)
|
||||||||||||||
Corporate debt securities
|
$
|
36,272
|
|
|
$
|
8
|
|
|
$
|
(22
|
)
|
|
$
|
36,258
|
|
Bank certificates of deposit
|
13,100
|
|
|
7
|
|
|
—
|
|
|
13,107
|
|
||||
United States Treasury securities
|
33,972
|
|
|
69
|
|
|
(1
|
)
|
|
34,040
|
|
||||
United States government agency securities
|
7,157
|
|
|
2
|
|
|
—
|
|
|
7,159
|
|
||||
Commercial paper
|
4,188
|
|
|
7
|
|
|
—
|
|
|
4,195
|
|
||||
Marketable debt securities
|
94,689
|
|
|
93
|
|
|
(23
|
)
|
|
94,759
|
|
||||
Marketable equity securities
|
1,817
|
|
|
—
|
|
|
(16
|
)
|
|
1,801
|
|
||||
Total short-term investments
|
$
|
96,506
|
|
|
$
|
93
|
|
|
$
|
(39
|
)
|
|
$
|
96,560
|
|
|
As of January 3, 2015
|
||||||||||||||
|
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Fair
Value
|
||||||||
|
(In thousands)
|
||||||||||||||
Corporate debt securities
|
$
|
34,919
|
|
|
$
|
6
|
|
|
$
|
(31
|
)
|
|
$
|
34,894
|
|
Bank certificates of deposit
|
21,900
|
|
|
10
|
|
|
—
|
|
|
21,910
|
|
||||
United States Treasury securities
|
19,375
|
|
|
12
|
|
|
(13
|
)
|
|
19,374
|
|
||||
United States government agency securities
|
9,209
|
|
|
3
|
|
|
(4
|
)
|
|
9,208
|
|
||||
Commercial paper
|
3,184
|
|
|
4
|
|
|
(2
|
)
|
|
3,186
|
|
||||
Marketable debt securities
|
88,587
|
|
|
35
|
|
|
(50
|
)
|
|
88,572
|
|
||||
Marketable equity securities
|
1,817
|
|
|
56
|
|
|
—
|
|
|
1,873
|
|
||||
Total short-term investments
|
$
|
90,404
|
|
|
$
|
91
|
|
|
$
|
(50
|
)
|
|
$
|
90,445
|
|
|
Amortized
Cost
|
|
Fair
Value
|
||||
|
(In thousands)
|
||||||
Due in less than one year
|
$
|
52,956
|
|
|
$
|
52,990
|
|
Due in one to three years
|
41,733
|
|
|
41,769
|
|
||
Total marketable debt securities included in short-term investments
|
$
|
94,689
|
|
|
$
|
94,759
|
|
•
|
Level 1
– Quoted prices for identical instruments in active markets;
|
•
|
Level 2
– Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and
|
•
|
Level 3
– Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
|
|
Fair Value Measurements as of July 4, 2015:
|
||||||||||||||
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
|
(In thousands)
|
||||||||||||||
Assets
|
|
||||||||||||||
Cash equivalents:
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
415,443
|
|
|
$
|
415,443
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Short-term investments:
|
|
|
|
|
|
|
|
||||||||
Corporate debt securities
|
36,258
|
|
|
—
|
|
|
36,258
|
|
|
—
|
|
||||
Bank certificates of deposit
|
13,107
|
|
|
—
|
|
|
13,107
|
|
|
—
|
|
||||
United States Treasury securities
|
34,040
|
|
|
34,040
|
|
|
—
|
|
|
—
|
|
||||
United States government agency securities
|
7,159
|
|
|
7,159
|
|
|
—
|
|
|
—
|
|
||||
Commercial paper
|
4,195
|
|
|
—
|
|
|
4,195
|
|
|
—
|
|
||||
Marketable equity securities
|
1,801
|
|
|
1,801
|
|
|
—
|
|
|
—
|
|
||||
Trading securities held in Non-Qualified Deferred Compensation, or NQDC, trust
|
24,226
|
|
|
24,226
|
|
|
—
|
|
|
—
|
|
||||
Total Assets
|
$
|
536,229
|
|
|
$
|
482,669
|
|
|
$
|
53,560
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
|
(In thousands)
|
||||||||||||||
Liabilities
|
|
||||||||||||||
Foreign currency exchange contracts
|
536
|
|
|
—
|
|
|
536
|
|
|
—
|
|
||||
Total Liabilities
|
$
|
536
|
|
|
$
|
—
|
|
|
$
|
536
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Fair Value Measurements as of January 3, 2015:
|
||||||||||||||
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
|
(In thousands)
|
||||||||||||||
Assets
|
|
||||||||||||||
Cash equivalents:
|
|
|
|
|
|
|
|
|
|||||||
Money market funds
|
$
|
728,496
|
|
|
$
|
728,496
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Short-term investments:
|
|
|
|
|
|
|
|
||||||||
Corporate debt securities
|
34,894
|
|
|
—
|
|
|
34,894
|
|
|
—
|
|
||||
Bank certificates of deposit
|
21,910
|
|
|
—
|
|
|
21,910
|
|
|
—
|
|
||||
United States Treasury securities
|
19,374
|
|
|
19,374
|
|
|
—
|
|
|
—
|
|
||||
United States government agency securities
|
9,208
|
|
|
9,208
|
|
|
—
|
|
|
—
|
|
||||
Commercial paper
|
3,186
|
|
|
—
|
|
|
3,186
|
|
|
—
|
|
||||
Marketable equity securities
|
1,873
|
|
|
1,873
|
|
|
—
|
|
|
—
|
|
||||
Trading securities held in NQDC trust
|
27,034
|
|
|
27,034
|
|
|
—
|
|
|
—
|
|
||||
2015 Notes Hedges
|
523,930
|
|
|
—
|
|
|
523,930
|
|
|
—
|
|
||||
Total Assets
|
$
|
1,369,905
|
|
|
$
|
785,985
|
|
|
$
|
583,920
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
|
(In thousands)
|
||||||||||||||
Liabilities
|
|
||||||||||||||
2015 Notes Embedded Conversion Derivative
|
523,930
|
|
|
—
|
|
|
523,930
|
|
|
—
|
|
||||
Foreign currency exchange contracts
|
3,163
|
|
|
—
|
|
|
3,163
|
|
|
—
|
|
||||
Total Liabilities
|
$
|
527,093
|
|
|
$
|
—
|
|
|
$
|
527,093
|
|
|
$
|
—
|
|
|
As of
|
||||||
|
July 4,
2015 |
|
January 3,
2015 |
||||
|
(In thousands)
|
||||||
Accounts receivable
|
$
|
85,007
|
|
|
$
|
79,410
|
|
Unbilled accounts receivable
|
46,318
|
|
|
43,082
|
|
||
Long-term receivables
|
1,628
|
|
|
3,644
|
|
||
Total receivables
|
$
|
132,953
|
|
|
$
|
126,136
|
|
Less allowance for doubtful accounts
|
—
|
|
|
—
|
|
||
Total receivables, net
|
$
|
132,953
|
|
|
$
|
126,136
|
|
|
Gross Carrying
Amount
|
||
|
(In thousands)
|
||
Balance as of January 3, 2015
|
$
|
553,767
|
|
Effect of foreign currency translation
|
64
|
|
|
Balance as of July 4, 2015
|
$
|
553,831
|
|
|
Gross Carrying
Amount
|
|
Accumulated
Amortization
|
|
Acquired
Intangibles, Net
|
||||||
|
(In thousands)
|
||||||||||
Existing technology
|
$
|
328,447
|
|
|
$
|
(104,637
|
)
|
|
$
|
223,810
|
|
Agreements and relationships
|
173,554
|
|
|
(75,905
|
)
|
|
97,649
|
|
|||
Tradenames, trademarks and patents
|
10,119
|
|
|
(4,840
|
)
|
|
5,279
|
|
|||
Total acquired intangibles with definite lives
|
512,120
|
|
|
(185,382
|
)
|
|
326,738
|
|
|||
In-process technology
|
1,600
|
|
|
—
|
|
|
1,600
|
|
|||
Total acquired intangibles
|
$
|
513,720
|
|
|
$
|
(185,382
|
)
|
|
$
|
328,338
|
|
|
Gross Carrying
Amount
|
|
Accumulated
Amortization
|
|
Acquired
Intangibles, Net
|
||||||
|
(In thousands)
|
||||||||||
Existing technology
|
$
|
328,325
|
|
|
$
|
(84,822
|
)
|
|
$
|
243,503
|
|
Agreements and relationships
|
175,202
|
|
|
(65,512
|
)
|
|
109,690
|
|
|||
Tradenames, trademarks and patents
|
10,619
|
|
|
(4,480
|
)
|
|
6,139
|
|
|||
Total acquired intangibles with definite lives
|
514,146
|
|
|
(154,814
|
)
|
|
359,332
|
|
|||
In-process technology
|
1,600
|
|
|
—
|
|
|
1,600
|
|
|||
Total acquired intangibles
|
$
|
515,746
|
|
|
$
|
(154,814
|
)
|
|
$
|
360,932
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
July 4,
2015 |
|
June 28,
2014 |
||||||||
|
(In thousands)
|
||||||||||||||
Cost of product and maintenance
|
$
|
10,105
|
|
|
$
|
8,613
|
|
|
$
|
20,278
|
|
|
$
|
16,189
|
|
Amortization of acquired intangibles
|
6,119
|
|
|
5,579
|
|
|
12,350
|
|
|
10,789
|
|
||||
Total amortization of acquired intangibles
|
$
|
16,224
|
|
|
$
|
14,192
|
|
|
$
|
32,628
|
|
|
$
|
26,978
|
|
|
(In thousands)
|
||
2015 – remaining period
|
$
|
31,600
|
|
2016
|
57,330
|
|
|
2017
|
52,627
|
|
|
2018
|
48,944
|
|
|
2019
|
42,935
|
|
|
Thereafter
|
93,302
|
|
|
Total estimated amortization expense
|
$
|
326,738
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
July 4,
2015 |
|
June 28,
2014 |
||||||||
|
(In thousands)
|
||||||||||||||
Cost of product and maintenance
|
$
|
558
|
|
|
$
|
485
|
|
|
$
|
1,127
|
|
|
$
|
967
|
|
Cost of services
|
815
|
|
|
709
|
|
|
1,647
|
|
|
1,412
|
|
||||
Marketing and sales
|
5,236
|
|
|
4,560
|
|
|
10,683
|
|
|
9,156
|
|
||||
Research and development
|
11,401
|
|
|
9,701
|
|
|
22,778
|
|
|
19,368
|
|
||||
General and administrative
|
3,693
|
|
|
3,622
|
|
|
7,329
|
|
|
7,038
|
|
||||
Total stock-based compensation expense
|
$
|
21,703
|
|
|
$
|
19,077
|
|
|
$
|
43,564
|
|
|
$
|
37,941
|
|
|
Severance
and
Benefits
|
|
Excess
Facilities
|
|
Other
|
|
Total
|
||||||||
|
(In thousands)
|
||||||||||||||
Balance, January 3, 2015
|
$
|
4,462
|
|
|
$
|
1,267
|
|
|
$
|
481
|
|
|
$
|
6,210
|
|
Restructuring and other charges (credits):
|
|
|
|
|
|
|
|
||||||||
2015 Restructuring Plan
|
3,862
|
|
|
—
|
|
|
—
|
|
|
3,862
|
|
||||
Prior restructuring plans
|
(559
|
)
|
|
558
|
|
|
—
|
|
|
(1
|
)
|
||||
Cash payments
|
(5,832
|
)
|
|
(428
|
)
|
|
—
|
|
|
(6,260
|
)
|
||||
Effect of foreign currency translation
|
(16
|
)
|
|
(41
|
)
|
|
—
|
|
|
(57
|
)
|
||||
Balance, July 4, 2015
|
$
|
1,917
|
|
|
$
|
1,356
|
|
|
$
|
481
|
|
|
$
|
3,754
|
|
|
As of
|
||
|
July 4, 2015
|
||
|
(In thousands)
|
||
Accounts payable and accrued liabilities
|
$
|
3,549
|
|
Other long-term liabilities
|
205
|
|
|
Total liabilities
|
$
|
3,754
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
July 4,
2015 |
|
June 28,
2014 |
||||||||
|
(In thousands, except per share amounts)
|
||||||||||||||
Net income
|
$
|
58,160
|
|
|
$
|
23,263
|
|
|
$
|
94,419
|
|
|
$
|
56,333
|
|
Weighted average common shares used to calculate basic net income per share
|
285,297
|
|
|
283,344
|
|
|
284,910
|
|
|
282,480
|
|
||||
2015 Warrants
|
20,635
|
|
|
15,054
|
|
|
19,773
|
|
|
13,815
|
|
||||
Stock-based awards
|
7,733
|
|
|
7,357
|
|
|
8,073
|
|
|
7,100
|
|
||||
Weighted average common shares used to calculate diluted net income per share
|
313,665
|
|
|
305,755
|
|
|
312,756
|
|
|
303,395
|
|
||||
Net income per share - basic
|
$
|
0.20
|
|
|
$
|
0.08
|
|
|
$
|
0.33
|
|
|
$
|
0.20
|
|
Net income per share - diluted
|
$
|
0.19
|
|
|
$
|
0.08
|
|
|
$
|
0.30
|
|
|
$
|
0.19
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
July 4,
2015 |
|
June 28,
2014 |
||||
|
(In thousands)
|
||||||||||
Options to purchase shares of common stock
|
1,503
|
|
|
4,399
|
|
|
1,308
|
|
|
4,517
|
|
Non-vested shares of restricted stock
|
23
|
|
|
8
|
|
|
18
|
|
|
9
|
|
Total potential common shares excluded
|
1,526
|
|
|
4,407
|
|
|
1,326
|
|
|
4,526
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
July 4,
2015 |
|
June 28,
2014 |
||||||||
|
(In thousands)
|
||||||||||||||
Shares repurchased
|
2,887
|
|
|
768
|
|
|
4,889
|
|
|
1,595
|
|
||||
Total cost of repurchased shares
|
$
|
56,279
|
|
|
$
|
12,515
|
|
|
$
|
93,076
|
|
|
$
|
25,032
|
|
|
As of
|
||||||
|
July 4,
2015 |
|
January 3,
2015 |
||||
|
(In thousands)
|
||||||
Foreign currency translation gain
|
$
|
2,289
|
|
|
$
|
15,707
|
|
Changes in defined benefit plan liabilities
|
(3,084
|
)
|
|
(3,401
|
)
|
||
Unrealized holding gains on available-for-sale securities
|
54
|
|
|
41
|
|
||
Total accumulated other comprehensive income (loss)
|
$
|
(741
|
)
|
|
$
|
12,347
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
July 4,
2015 |
|
June 28,
2014 |
||||||||
|
(In thousands)
|
||||||||||||||
Americas:
|
|
|
|
|
|
|
|
||||||||
United States
|
$
|
192,176
|
|
|
$
|
161,874
|
|
|
$
|
379,383
|
|
|
$
|
325,202
|
|
Other Americas
|
7,425
|
|
|
6,050
|
|
|
12,839
|
|
|
11,834
|
|
||||
Total Americas
|
199,601
|
|
|
167,924
|
|
|
392,222
|
|
|
337,036
|
|
||||
Asia
|
96,426
|
|
|
88,286
|
|
|
195,208
|
|
|
175,302
|
|
||||
Europe, Middle East and Africa
|
82,014
|
|
|
82,074
|
|
|
160,584
|
|
|
159,606
|
|
||||
Japan
|
37,842
|
|
|
40,504
|
|
|
79,235
|
|
|
85,394
|
|
||||
Total
|
$
|
415,883
|
|
|
$
|
378,788
|
|
|
$
|
827,249
|
|
|
$
|
757,338
|
|
|
As of
|
||||||
|
July 4,
2015 |
|
January 3,
2015 |
||||
|
(In thousands)
|
||||||
Americas:
|
|
|
|
||||
United States
|
$
|
194,071
|
|
|
$
|
200,760
|
|
Other Americas
|
448
|
|
|
578
|
|
||
Total Americas
|
194,519
|
|
|
201,338
|
|
||
Asia
|
22,846
|
|
|
22,145
|
|
||
Europe, Middle East and Africa
|
11,870
|
|
|
5,951
|
|
||
Japan
|
603
|
|
|
678
|
|
||
Total
|
$
|
229,838
|
|
|
$
|
230,112
|
|
•
|
Functional Verification, including Emulation Hardware;
|
•
|
Digital IC Design and Signoff;
|
•
|
Custom IC Design;
|
•
|
System Interconnect and Analysis; and
|
•
|
IP.
|
•
|
increased product and maintenance revenue, primarily because of increased business levels and incremental revenue recognized from our fiscal 2014 acquisitions;
|
•
|
continued investment in research and development activities;
|
•
|
favorable changes in foreign currency exchange rates on our operating expenses;
|
•
|
decreased acquisition-related costs;
|
•
|
increased stock-based compensation; and
|
•
|
increased amortization of acquired intangibles resulting from our fiscal 2014 acquisitions.
|
|
Three Months Ended
|
|
Change
|
|||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
Amount
|
|
Percentage
|
|||||||
|
(In millions, except percentages)
|
|||||||||||||
Product and maintenance
|
$
|
385.0
|
|
|
$
|
354.5
|
|
|
$
|
30.5
|
|
|
9
|
%
|
Services
|
30.9
|
|
|
24.3
|
|
|
6.6
|
|
|
27
|
%
|
|||
Total revenue
|
$
|
415.9
|
|
|
$
|
378.8
|
|
|
$
|
37.1
|
|
|
10
|
%
|
|
Six Months Ended
|
|
Change
|
|||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
Amount
|
|
Percentage
|
|||||||
|
(In millions, except percentages)
|
|||||||||||||
Product and maintenance
|
$
|
768.6
|
|
|
$
|
711.8
|
|
|
$
|
56.8
|
|
|
8
|
%
|
Services
|
58.6
|
|
|
45.5
|
|
|
13.1
|
|
|
29
|
%
|
|||
Total revenue
|
$
|
827.2
|
|
|
$
|
757.3
|
|
|
$
|
69.9
|
|
|
9
|
%
|
|
Three Months Ended
|
|||||||||||||
|
June 28,
2014 |
|
September 27,
2014 |
|
January 3,
2015 |
|
April 4,
2015 |
|
July 4,
2015 |
|||||
Functional Verification, including Emulation Hardware
|
21
|
%
|
|
23
|
%
|
|
21
|
%
|
|
23
|
%
|
|
21
|
%
|
Digital IC Design and Signoff
|
30
|
%
|
|
29
|
%
|
|
28
|
%
|
|
28
|
%
|
|
29
|
%
|
Custom IC Design
|
28
|
%
|
|
27
|
%
|
|
28
|
%
|
|
27
|
%
|
|
27
|
%
|
System Interconnect and Analysis
|
11
|
%
|
|
10
|
%
|
|
11
|
%
|
|
11
|
%
|
|
11
|
%
|
IP
|
10
|
%
|
|
11
|
%
|
|
12
|
%
|
|
11
|
%
|
|
12
|
%
|
Total
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
Three Months Ended
|
|
Change
|
|||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
Amount
|
|
Percentage
|
|||||||
|
(In millions, except percentages)
|
|||||||||||||
United States
|
$
|
192.2
|
|
|
$
|
161.9
|
|
|
$
|
30.3
|
|
|
19
|
%
|
Other Americas
|
7.4
|
|
|
6.1
|
|
|
1.3
|
|
|
21
|
%
|
|||
Asia
|
96.4
|
|
|
88.3
|
|
|
8.1
|
|
|
9
|
%
|
|||
Europe, Middle East and Africa
|
82.0
|
|
|
82.1
|
|
|
(0.1
|
)
|
|
—
|
%
|
|||
Japan
|
37.9
|
|
|
40.4
|
|
|
(2.5
|
)
|
|
(6
|
)%
|
|||
Total revenue
|
$
|
415.9
|
|
|
$
|
378.8
|
|
|
$
|
37.1
|
|
|
10
|
%
|
|
Six Months Ended
|
|
Change
|
|||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
Amount
|
|
Percentage
|
|||||||
|
(In millions, except percentages)
|
|||||||||||||
United States
|
$
|
379.4
|
|
|
$
|
325.2
|
|
|
$
|
54.2
|
|
|
17
|
%
|
Other Americas
|
12.8
|
|
|
11.8
|
|
|
1.0
|
|
|
8
|
%
|
|||
Asia
|
195.2
|
|
|
175.3
|
|
|
19.9
|
|
|
11
|
%
|
|||
Europe, Middle East and Africa
|
160.6
|
|
|
159.6
|
|
|
1.0
|
|
|
1
|
%
|
|||
Japan
|
79.2
|
|
|
85.4
|
|
|
(6.2
|
)
|
|
(7
|
)%
|
|||
Total revenue
|
$
|
827.2
|
|
|
$
|
757.3
|
|
|
$
|
69.9
|
|
|
9
|
%
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
July 4,
2015 |
|
June 28,
2014 |
||||
United States
|
46
|
%
|
|
43
|
%
|
|
46
|
%
|
|
43
|
%
|
Other Americas
|
2
|
%
|
|
1
|
%
|
|
1
|
%
|
|
2
|
%
|
Asia
|
23
|
%
|
|
23
|
%
|
|
24
|
%
|
|
23
|
%
|
Europe, Middle East and Africa
|
20
|
%
|
|
22
|
%
|
|
19
|
%
|
|
21
|
%
|
Japan
|
9
|
%
|
|
11
|
%
|
|
10
|
%
|
|
11
|
%
|
Total
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
Three Months Ended
|
|
Change
|
|||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
Amount
|
|
Percentage
|
|||||||
|
(In millions, except percentages)
|
|||||||||||||
Cost of product and maintenance
|
$
|
31.7
|
|
|
$
|
37.7
|
|
|
$
|
(6.0
|
)
|
|
(16
|
)%
|
Cost of services
|
20.0
|
|
|
16.7
|
|
|
3.3
|
|
|
20
|
%
|
|
Six Months Ended
|
|
Change
|
|||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
Amount
|
|
Percentage
|
|||||||
|
(In millions, except percentages)
|
|||||||||||||
Cost of product and maintenance
|
$
|
73.8
|
|
|
$
|
79.9
|
|
|
$
|
(6.1
|
)
|
|
(8
|
)%
|
Cost of services
|
38.6
|
|
|
31.6
|
|
|
7.0
|
|
|
22
|
%
|
|
Three Months Ended
|
|
Change
|
|||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
Amount
|
|
Percentage
|
|||||||
|
(In millions, except percentages)
|
|||||||||||||
Product and maintenance-related costs
|
$
|
21.6
|
|
|
$
|
29.1
|
|
|
$
|
(7.5
|
)
|
|
(26
|
)%
|
Amortization of acquired intangibles
|
10.1
|
|
|
8.6
|
|
|
1.5
|
|
|
17
|
%
|
|||
Total cost of product and maintenance
|
$
|
31.7
|
|
|
$
|
37.7
|
|
|
$
|
(6.0
|
)
|
|
(16
|
)%
|
|
Six Months Ended
|
|
Change
|
|||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
Amount
|
|
Percentage
|
|||||||
|
(In millions, except percentages)
|
|||||||||||||
Product and maintenance-related costs
|
$
|
53.5
|
|
|
$
|
63.7
|
|
|
$
|
(10.2
|
)
|
|
(16
|
)%
|
Amortization of acquired intangibles
|
20.3
|
|
|
16.2
|
|
|
4.1
|
|
|
25
|
%
|
|||
Total cost of product and maintenance
|
$
|
73.8
|
|
|
$
|
79.9
|
|
|
$
|
(6.1
|
)
|
|
(8
|
)%
|
|
Change
|
||||||
|
Three Months Ended
|
|
Six Months Ended
|
||||
|
(In millions)
|
||||||
Emulation hardware costs
|
$
|
(8.0
|
)
|
|
$
|
(12.5
|
)
|
Materials and other pre-production costs
|
0.9
|
|
|
1.7
|
|
||
Other items
|
(0.4
|
)
|
|
0.6
|
|
||
|
$
|
(7.5
|
)
|
|
$
|
(10.2
|
)
|
|
Three Months Ended
|
|
Change
|
|||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
Amount
|
|
Percentage
|
|||||||
|
(In millions, except percentages)
|
|||||||||||||
Marketing and sales
|
$
|
96.7
|
|
|
$
|
98.6
|
|
|
$
|
(1.9
|
)
|
|
(2
|
)%
|
Research and development
|
158.0
|
|
|
152.7
|
|
|
5.3
|
|
|
3
|
%
|
|||
General and administrative
|
27.5
|
|
|
32.0
|
|
|
(4.5
|
)
|
|
(14
|
)%
|
|||
Total operating expenses
|
$
|
282.2
|
|
|
$
|
283.3
|
|
|
$
|
(1.1
|
)
|
|
—
|
%
|
|
Six Months Ended
|
|
Change
|
|||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
Amount
|
|
Percentage
|
|||||||
|
(In millions, except percentages)
|
|||||||||||||
Marketing and sales
|
$
|
196.9
|
|
|
$
|
196.9
|
|
|
$
|
—
|
|
|
—
|
%
|
Research and development
|
321.0
|
|
|
299.1
|
|
|
21.9
|
|
|
7
|
%
|
|||
General and administrative
|
55.1
|
|
|
60.8
|
|
|
(5.7
|
)
|
|
(9
|
)%
|
|||
Total operating expenses
|
$
|
573.0
|
|
|
$
|
556.8
|
|
|
$
|
16.2
|
|
|
3
|
%
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
July 4,
2015 |
|
June 28,
2014 |
||||
Marketing and sales
|
23
|
%
|
|
26
|
%
|
|
24
|
%
|
|
26
|
%
|
Research and development
|
38
|
%
|
|
40
|
%
|
|
39
|
%
|
|
39
|
%
|
General and administrative
|
7
|
%
|
|
8
|
%
|
|
7
|
%
|
|
8
|
%
|
Total operating expenses
|
68
|
%
|
|
74
|
%
|
|
70
|
%
|
|
73
|
%
|
|
Change
|
||||||
|
Three Months Ended
|
|
Six Months Ended
|
||||
|
(In millions)
|
||||||
Salary, benefits and other employee-related costs
|
$
|
0.9
|
|
|
$
|
2.0
|
|
Stock-based compensation
|
0.7
|
|
|
1.5
|
|
||
Professional services
|
(0.8
|
)
|
|
(1.3
|
)
|
||
Severance and other termination costs, including voluntary early retirement program
|
(1.9
|
)
|
|
(1.9
|
)
|
||
Other items
|
(0.8
|
)
|
|
(0.3
|
)
|
||
|
$
|
(1.9
|
)
|
|
$
|
—
|
|
|
Change
|
||||||
|
Three Months Ended
|
|
Six Months Ended
|
||||
|
(In millions)
|
||||||
Materials and other pre-production costs
|
$
|
3.3
|
|
|
$
|
8.5
|
|
Facilities and other infrastructure costs
|
4.2
|
|
|
8.4
|
|
||
Stock-based compensation
|
1.7
|
|
|
3.4
|
|
||
Salary, benefits and other employee-related costs
|
0.9
|
|
|
3.1
|
|
||
Software license and maintenance costs
|
1.5
|
|
|
2.9
|
|
||
Severance and other termination costs, including voluntary early retirement program
|
(5.9
|
)
|
|
(5.9
|
)
|
||
Other items
|
(0.4
|
)
|
|
1.5
|
|
||
|
$
|
5.3
|
|
|
$
|
21.9
|
|
|
Change
|
||||||
|
Three Months Ended
|
|
Six Months Ended
|
||||
|
(In millions)
|
||||||
Professional services
|
$
|
(3.3
|
)
|
|
$
|
(4.7
|
)
|
Severance and other termination costs, including voluntary early retirement program
|
(1.5
|
)
|
|
(1.5
|
)
|
||
Other items
|
0.3
|
|
|
0.5
|
|
||
|
$
|
(4.5
|
)
|
|
$
|
(5.7
|
)
|
|
Three Months Ended
|
|
Change
|
|||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
Amount
|
|
Percentage
|
|||||||
|
(In millions, except percentages)
|
|||||||||||||
Amortization of acquired intangibles
|
$
|
6.1
|
|
|
$
|
5.6
|
|
|
$
|
0.5
|
|
|
9
|
%
|
|
Six Months Ended
|
|
Change
|
|||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
Amount
|
|
Percentage
|
|||||||
|
(In millions, except percentages)
|
|||||||||||||
Amortization of acquired intangibles
|
$
|
12.4
|
|
|
$
|
10.8
|
|
|
$
|
1.6
|
|
|
15
|
%
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
July 4,
2015 |
|
June 28,
2014 |
||||||||
|
(In millions)
|
||||||||||||||
Contractual interest expense:
|
|
|
|
|
|
|
|
||||||||
2015 Notes
|
$
|
1.2
|
|
|
$
|
2.3
|
|
|
$
|
3.0
|
|
|
$
|
4.6
|
|
2024 Notes
|
3.8
|
|
|
—
|
|
|
7.6
|
|
|
—
|
|
||||
Revolving credit facility
|
0.1
|
|
|
0.2
|
|
|
0.3
|
|
|
0.3
|
|
||||
Amortization of debt discount:
|
|
|
|
|
|
|
|
||||||||
2015 Notes
|
2.5
|
|
|
4.3
|
|
|
7.5
|
|
|
8.5
|
|
||||
2024 Notes
|
—
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
||||
Amortization of deferred financing costs:
|
|
|
|
|
|
|
|
||||||||
2015 Notes
|
0.3
|
|
|
0.6
|
|
|
1.0
|
|
|
1.2
|
|
||||
2024 Notes
|
0.1
|
|
|
—
|
|
|
0.3
|
|
|
—
|
|
||||
Other
|
0.2
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
||||
Total interest expense
|
$
|
8.2
|
|
|
$
|
7.4
|
|
|
$
|
19.9
|
|
|
$
|
14.6
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
July 4,
2015 |
|
June 28,
2014 |
||||||||
|
(In millions, except percentages)
|
||||||||||||||
Provision for income taxes
|
$
|
11.4
|
|
|
$
|
6.5
|
|
|
$
|
17.5
|
|
|
$
|
11.9
|
|
Effective tax rate
|
16.4
|
%
|
|
21.8
|
%
|
|
15.6
|
%
|
|
17.4
|
%
|
|
As of
|
|
|
||||||||
|
July 4,
2015 |
|
January 3,
2015 |
|
Change
|
||||||
|
(In millions)
|
||||||||||
Cash, cash equivalents and short-term investments
|
$
|
744.4
|
|
|
$
|
1,022.6
|
|
|
$
|
(278.2
|
)
|
Net working capital
|
$
|
539.9
|
|
|
$
|
458.6
|
|
|
$
|
81.3
|
|
|
Six Months Ended
|
|
|
||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
Change
|
||||||
|
(In millions)
|
||||||||||
Cash provided by operating activities
|
$
|
168.4
|
|
|
$
|
97.0
|
|
|
$
|
71.4
|
|
|
Six Months Ended
|
|
|
||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
Change
|
||||||
|
(In millions)
|
||||||||||
Cash used for investing activities
|
$
|
(28.1
|
)
|
|
$
|
(180.5
|
)
|
|
$
|
152.4
|
|
|
Six Months Ended
|
|
|
||||||||
|
July 4,
2015 |
|
June 28,
2014 |
|
Change
|
||||||
|
(In millions)
|
||||||||||
Cash provided by (used for) financing activities
|
$
|
(410.6
|
)
|
|
$
|
100.0
|
|
|
$
|
(510.6
|
)
|
|
Notional
Principal
|
|
Weighted
Average
Contract
Rate
|
|||
|
(In millions)
|
|
|
|||
Forward Contracts:
|
|
|
|
|||
European Union euro
|
$
|
51.5
|
|
|
0.89
|
|
Israeli shekel
|
18.6
|
|
|
3.84
|
|
|
Japanese yen
|
16.4
|
|
|
123.33
|
|
|
Taiwan dollar
|
12.8
|
|
|
30.91
|
|
|
Canadian dollar
|
11.2
|
|
|
1.23
|
|
|
Chinese renminbi
|
6.1
|
|
|
6.22
|
|
|
Indian rupee
|
5.0
|
|
|
64.40
|
|
|
Other
|
13.1
|
|
|
N/A
|
|
|
Total
|
$
|
134.7
|
|
|
|
|
Estimated fair value
|
$
|
(0.5
|
)
|
|
|
|
Shares
|
|
|
(In millions)
|
|
$15.00
|
13.0
|
|
$16.00
|
15.1
|
|
$17.00
|
17.0
|
|
$18.00
|
18.6
|
|
$19.00
|
20.1
|
|
$20.00
|
21.4
|
|
$21.00
|
22.6
|
|
$22.00
|
23.7
|
|
$23.00
|
24.6
|
|
$24.00
|
25.5
|
|
$25.00
|
26.4
|
|
•
|
changes in the design and manufacturing of ICs, including migration to advanced process nodes and the introduction of three dimensional transistors, such as fin-based, multigate transistors, or FinFETs, present major challenges to the semiconductor industry, particularly in IC design, design automation, design of manufacturing equipment, and the manufacturing process itself. With migration to advanced process nodes, the industry must adapt to more complex physics and manufacturing challenges such as the need to draw features on silicon that are many times smaller than the wavelength of light used to draw the features via lithography. Models of each component’s electrical properties and behavior also become more complex as do requisite analysis, design, verification and manufacturing capabilities. Novel design tools and methodologies must be invented and enhanced quickly to remain competitive in the design of electronics in the smallest nanometer ranges;
|
•
|
the challenges of advanced node design are leading some customers to work with more mature, less risky manufacturing processes that may reduce their need to upgrade or enhance their EDA products and design flows;
|
•
|
the ability to design SoCs increases the complexity of managing a design that, at the lowest level, is represented by billions of shapes on fabrication masks. In addition, SoCs typically incorporate microprocessors and digital signal processors that are programmed with software, requiring simultaneous design of the IC and the related software embedded on the IC;
|
•
|
with the availability of seemingly endless gate capacity, there is an increase in design reuse, or the combining of off-the-shelf design IP with custom logic to create ICs or SoCs. The unavailability of a broad range of high-quality design IP (including our own) that can be reliably incorporated into a customer’s design with our software products and services could lead to reduced demand for our products and services;
|
•
|
increased technological capability of the Field-Programmable Gate Array, or FPGA, which is a programmable logic chip, creates an alternative to IC implementation for some electronics companies. This could reduce demand for our IC implementation products and services;
|
•
|
a growing number of low-cost engineering services businesses could reduce the need for some IC companies to invest in EDA products; and
|
•
|
adoption of cloud computing technologies with accompanying new business models for an increasing number of software categories, including EDA.
|
•
|
the failure to realize anticipated benefits such as cost savings and revenue enhancements;
|
•
|
overlapping customers and product sets that impact our ability to maintain revenue at historical rates;
|
•
|
the failure to integrate and manage acquired products and businesses effectively;
|
•
|
the failure to retain key employees of the acquired company or business;
|
•
|
difficulties in combining previously separate companies or businesses into a single unit;
|
•
|
the substantial diversion of management’s attention from day-to-day business when evaluating and negotiating these transactions and integrating an acquired company or business;
|
•
|
the discovery, after completion of the acquisition, of unanticipated liabilities assumed from the acquired company, business or assets, such that we cannot realize the anticipated value of the acquisition;
|
•
|
difficulties related to integrating the products of an acquired company or business in, for example, distribution, engineering, licensing models or customer support areas;
|
•
|
unanticipated costs;
|
•
|
customer dissatisfaction with existing license agreements with us, possibly dissuading customers from licensing or buying products acquired by us after the expiration date of the existing license; or
|
•
|
the failure to understand, compete and operate effectively in markets where we have limited experience.
|
•
|
the development by others of competitive EDA products or platforms and engineering services, possibly resulting in a shift of customer preferences away from our products and services and significantly decreased revenue;
|
•
|
aggressive pricing competition by some of our competitors may cause us to lose our competitive position, which could result in lower revenues or profitability and could adversely impact our ability to realize the revenue and profitability forecasts for our software or emulation hardware systems products;
|
•
|
the challenges of developing (or acquiring externally developed) technology solutions, including emulation hardware and IP offerings, that are adequate and competitive in meeting the rapidly evolving requirements of next-generation design challenges;
|
•
|
the significant number of current and potential competitors in the EDA industry and the low cost of entry;
|
•
|
intense competition to attract acquisition targets, possibly making it more difficult for us to acquire companies or technologies at an acceptable price, or at all;
|
•
|
the combination of our EDA competitors or collaboration among many EDA companies to deliver more comprehensive offerings than they could individually; and
|
•
|
decisions by electronics manufacturers to perform engineering services or IP development internally, rather than purchase these services from outside vendors due to budget constraints or excess engineering capacity.
|
•
|
quarterly or annual operating or financial results or forecasts that fail to meet or are inconsistent with earlier projections or the expectations of our securities analysts or investors;
|
•
|
changes in our forecasted bookings, revenue, earnings or operating cash flow estimates;
|
•
|
market conditions in the IC, electronics systems and semiconductor industries;
|
•
|
announcements of a restructuring plan;
|
•
|
changes in management;
|
•
|
a gain or loss of a significant customer or market segment share;
|
•
|
litigation; and
|
•
|
announcements of new products or acquisitions of new technologies by us, our competitors or our customers.
|
•
|
the adoption or expansion of government trade restrictions, including tariffs and other trade barriers;
|
•
|
limitations on repatriation of earnings;
|
•
|
limitations on the conversion of foreign currencies;
|
•
|
reduced protection of intellectual property rights in some countries;
|
•
|
performance of national economies;
|
•
|
longer collection periods for receivables and greater difficulty in collecting accounts receivable;
|
•
|
difficulties in managing foreign operations;
|
•
|
political and economic instability;
|
•
|
unexpected changes in regulatory requirements;
|
•
|
inability to continue to offer competitive compensation in certain growing regions;
|
•
|
differing employment practices and labor issues;
|
•
|
United States’ and other governments’ licensing requirements for exports, which may lengthen the sales cycle or restrict or prohibit the sale or licensing of certain products; and
|
•
|
variations in costs or expenses associated with our international operations, including as a result of changes in foreign tax laws or devaluation of the U.S. dollar relative to other foreign currencies.
|
•
|
pay damages (including the potential for treble damages), license fees or royalties (including royalties for past periods) to the party claiming infringement;
|
•
|
stop licensing products or providing services that use the challenged intellectual property;
|
•
|
obtain a license from the owner of the infringed intellectual property to sell or use the relevant technology, which license may not be available on reasonable terms, or at all; or
|
•
|
redesign the challenged technology, which could be time consuming and costly, or impossible.
|
•
|
the timing of customers’ competitive evaluation processes; or
|
•
|
customers’ budgetary constraints and budget cycles.
|
•
|
changes in tax laws or the interpretation of such tax laws in the United States, Ireland, Hungary, the United Kingdom and other international locations where we have operations;
|
•
|
earnings being lower than anticipated in countries where we are taxed at lower rates as compared to the United States federal and state statutory tax rates;
|
•
|
an increase in expenses not deductible for tax purposes, including certain stock-based compensation and impairment of goodwill;
|
•
|
changes in the valuation allowance against our deferred tax assets;
|
•
|
changes in judgment from the evaluation of new information that results in a recognition, derecognition or change in measurement of a tax position taken in a prior period;
|
•
|
increases to interest or penalty expenses classified in the financial statements as income taxes;
|
•
|
new accounting standards or interpretations of such standards;
|
•
|
a change in our decision to indefinitely reinvest foreign earnings outside the United States; or
|
•
|
results of tax examinations by the Internal Revenue Service, or IRS, state, and foreign tax authorities.
|
•
|
loss of customers;
|
•
|
loss of market share;
|
•
|
damage to our reputation;
|
•
|
failure to attract new customers or achieve market acceptance;
|
•
|
diversion of development resources to resolve the problem;
|
•
|
loss of or delay in revenue;
|
•
|
increased service costs; and
|
•
|
liability for damages.
|
•
|
Our certificate of incorporation allows our Board of Directors to issue, at any time and without stockholder approval, preferred stock with such terms as it may determine. No shares of preferred stock are currently outstanding. However, the rights of holders of any of our preferred stock that may be issued in the future may be superior to the rights of holders of our common stock.
|
•
|
Section 203 of the Delaware General Corporation Law generally prohibits a Delaware corporation from engaging in any business combination with a person owning 15% or more of its voting stock, or who is affiliated with the corporation and owned 15% or more of its voting stock at any time within three years prior to the proposed business combination, for a period of three years from the date the person became a 15% owner, unless specified conditions are met.
|
•
|
making it more difficult for us to satisfy our obligations to service our debt as described above;
|
•
|
limiting our ability to obtain additional financing to fund future working capital, capital expenditures,
|
•
|
requiring a substantial portion of our cash flows to be dedicated to debt service payments instead of other
|
•
|
utilizing large portions of our U.S. cash to service our debt obligations because those payments are made in the United States, which may require us to repatriate cash from outside the United States and incur unanticipated or unfavorable tax expenses;
|
•
|
increasing our vulnerability to general adverse economic and industry conditions;
|
•
|
exposing us to the risk of increased interest rates as certain of our borrowings, including borrowings under
|
•
|
limiting our flexibility in planning for and reacting to changes in the industry in which we compete;
|
•
|
placing us at a disadvantage compared to other, less leveraged competitors and competitors that have greater access to capital resources; and
|
•
|
increasing our cost of borrowing.
|
•
|
incur additional indebtedness and guarantee indebtedness;
|
•
|
pay dividends or make other distributions or repurchase or redeem capital stock;
|
•
|
prepay, redeem or repurchase certain debt;
|
•
|
issue certain preferred stock or similar equity securities;
|
•
|
make certain investments;
|
•
|
sell assets;
|
•
|
incur liens;
|
•
|
enter into sale and leaseback transactions;
|
•
|
enter into transactions with affiliates;
|
•
|
alter the businesses we conduct;
|
•
|
enter into agreements restricting our subsidiaries’ ability to pay dividends; and
|
•
|
consolidate, merge or sell all or substantially all of our assets.
|
•
|
limited in how we conduct our business;
|
•
|
unable to raise additional debt or equity financing to operate during general economic or business downturns; or
|
•
|
unable to compete effectively or to take advantage of new business opportunities.
|
Period
|
|
Total Number
of Shares
Purchased
(1)
|
|
Average
Price Paid
Per Share
|
|
Total Number of
Shares Purchased
as Part of
Publicly Announced Plan or Program
|
|
Maximum Dollar
Value of Shares that
May Yet
Be Purchased Under
Publicly Announced
Plan or Program
(1)
(In millions)
|
||||||
April 5, 2015 – May 9, 2015
|
|
836,717
|
|
|
$
|
18.90
|
|
|
807,100
|
|
|
$
|
662.2
|
|
May 10, 2015 – June 6, 2015
|
|
1,044,429
|
|
|
$
|
19.46
|
|
|
1,025,800
|
|
|
$
|
642.2
|
|
June 7, 2015 – July 4, 2015
|
|
1,079,856
|
|
|
$
|
19.96
|
|
|
1,054,417
|
|
|
$
|
1,200.0
|
|
Total
|
|
2,961,002
|
|
|
$
|
19.49
|
|
|
2,887,317
|
|
|
|
(1)
|
Shares purchased that were not part of our publicly announced repurchase programs represent employee surrender of shares of restricted stock to satisfy employee income tax withholding obligations due upon vesting, and do not reduce the dollar value that may yet be purchased under our publicly announced repurchase programs.
|
(a)
|
The following exhibits are filed herewith:
|
|
|
|
|
Incorporated by Reference
|
||||||||
Exhibit
Number
|
|
Exhibit Title
|
|
Form
|
|
File No.
|
|
Exhibit
No.
|
|
Filing Date
|
|
Provided
Herewith
|
10.01
|
|
The Registrant's Omnibus Equity Incentive Plan.
|
|
S-8
|
|
333-204278
|
|
99.01
|
|
5/18/2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
31.01
|
|
Certification of the Registrant’s Chief Executive Officer, Lip-Bu Tan, pursuant to Rule 13a-14 of the Securities Exchange Act of 1934.
|
|
|
|
|
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
|
31.02
|
|
Certification of the Registrant’s Chief Financial Officer, Geoffrey G. Ribar, pursuant to Rule 13a-14 of the Securities Exchange Act of 1934.
|
|
|
|
|
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
|
32.01
|
|
Certification of the Registrant’s Chief Executive Officer, Lip-Bu Tan, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
|
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
|
32.02
|
|
Certification of the Registrant’s Chief Financial Officer, Geoffrey G. Ribar, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
|
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
|
101.INS
|
|
XBRL Instance Document.
|
|
|
|
|
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document.
|
|
|
|
|
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
|
|
|
|
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
|
101.DEF
|
|
XBRL Definition Linkbase Document.
|
|
|
|
|
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document.
|
|
|
|
|
|
|
|
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
|
|
|
|
|
|
|
|
|
X
|
|
|
|
|
CADENCE DESIGN SYSTEMS, INC.
(Registrant)
|
|
|
|
|
|
|
|
DATE:
|
July 27, 2015
|
|
|
By:
|
/s/ Lip-Bu Tan
|
|
|
|
|
|
Lip-Bu Tan
|
|
|
|
|
|
President, Chief Executive Officer and Director
|
|
|
|
|
|
|
DATE:
|
July 27, 2015
|
|
|
By:
|
/s/ Geoffrey G. Ribar
|
|
|
|
|
|
Geoffrey G. Ribar
|
|
|
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
|
|
Incorporated by Reference
|
||||||||
Exhibit
Number
|
|
Exhibit Title
|
|
Form
|
|
File No.
|
|
Exhibit
No.
|
|
Filing Date
|
|
Provided
Herewith
|
10.01
|
|
The Registrant's Omnibus Equity Incentive Plan.
|
|
S-8
|
|
333-204278
|
|
99.01
|
|
5/18/2015
|
|
|
|
|
|
|
|
|
|
|
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31.01
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Certification of the Registrant’s Chief Executive Officer, Lip-Bu Tan, pursuant to Rule 13a-14 of the Securities Exchange Act of 1934.
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X
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31.02
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Certification of the Registrant’s Chief Financial Officer, Geoffrey G. Ribar, pursuant to Rule 13a-14 of the Securities Exchange Act of 1934.
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X
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32.01
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Certification of the Registrant’s Chief Executive Officer, Lip-Bu Tan, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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X
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32.02
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Certification of the Registrant’s Chief Financial Officer, Geoffrey G. Ribar, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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X
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101.INS
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XBRL Instance Document.
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X
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101.SCH
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XBRL Taxonomy Extension Schema Document.
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X
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101.CAL
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XBRL Taxonomy Extension Calculation Linkbase Document.
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X
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101.DEF
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XBRL Definition Linkbase Document.
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X
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101.LAB
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XBRL Taxonomy Extension Label Linkbase Document.
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X
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101.PRE
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XBRL Taxonomy Extension Presentation Linkbase Document.
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X
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No information found
* THE VALUE IS THE MARKET VALUE AS OF THE LAST DAY OF THE QUARTER FOR WHICH THE 13F WAS FILED.
FUND | NUMBER OF SHARES | VALUE ($) | PUT OR CALL |
---|
DIRECTORS | AGE | BIO | OTHER DIRECTOR MEMBERSHIPS |
---|
No information found
Customers
Suppliers
Supplier name | Ticker |
---|---|
Trinseo S.A. | TSE |
Price
Yield
Owner | Position | Direct Shares | Indirect Shares |
---|