Financial: Xilinx Reports Record Results; Announces 2 for 1 Stock Split - Company Financial Information

Edge: Work-Group Computing Report, Jan 25, 1999

Xilinx, Inc. (NASDAQ:XLNX) Tuesday announced record revenues, net income and diluted EPS for the third fiscal quarter ended January 2, 1999. Revenues for the quarter were $167.4 million, up 7.0% from $156.4 million in the prior fiscal quarter, and up 12.5% from $148.7 million in the third fiscal quarter last year. Net income for the quarter was a record $33.9 million, or $0.45 per diluted share, up 21.9% from $27.8 million, or $0.37 per diluted share, reported in the prior fiscal quarter. This quarter's results included a $0.7 million, or $0.01 per diluted share, start-up loss associated with Xilinx's joint venture investment in a United Microelectronics Corporation wafer fabrication facility. Net income for the third fiscal quarter of last year was $31.6 million, or $0.40 per diluted share. Excluding the impact of the joint venture, earnings per diluted share for the quarter were $0.46, up $0.06 from the prior fiscal quarter and up $0.09 from the same period last year. "The December quarter exceeded our expectations. We had strong bookings throughout the quarter," remarked Wim Roelandts, Xilinx's chief executive officer. "For the fourth quarter in a row, Xilinx sales to networking customers increased and were a record 26% of total revenues. Xilinx chips are increasingly being used in the infrastructure equipment that is building the foundation for the Internet." Mr. Roelandts continued, "Twenty-six percent of our total revenues came from products manufactured at 0.35(mu) and below--more than any other PLD supplier. During the quarter, we commenced volume shipments of two members of our new 0.22(mu) Virtex FPGA family. Revenues for this family during the quarter approached $1 million, exceeding our expectations. Our cost-optimized Spartan family of FPGAs also posted strong results for the quarter with revenues increasing over 35% sequentially. Xilinx CPLD product revenues for the December quarter grew approximately 20% sequentially and now represent over 7% of total Xilinx revenues. We are exceptionally pleased that the strong design wins and software seat sales of the past 18 months have translated into record revenues for both our FPGA and CPLD products." Xilinx also announced Tuesday that its Board of Directors has approved a 2 for 1 split of the Company's Common Stock. On March 11, 1999 shareholders of record as of February 18, 1999 will receive one additional share of Common Stock for every share currently held. The numbers reported for the third fiscal quarter do not reflect the split.

Business Review - Third Quarter FY'99

Revenue by Geography:

Region                Q3 FY'99          Q2 FY'99

North America         71%               69%
Europe                20%               21%
Japan                  5%                6%
ROW                    4%                4%


Revenue by End Market(1):

End Market                Q3 FY'99(1)       Q2 FY'99 - R

Networking                26%               17%
Communications            39%               40%
Data Processing           20%               25%
Industrial/other          15%               18%

(1)  End Market Data reported on a worldwide basis beginning
     Q3 FY'99; Q2FY'99 numbers restated


Revenue Breakdown by Product Segment:

Product Family                 Q3 FY'99          Q2 FY'99

Base (greater than 0.5(mu))    22%               23%
Mainstream  (0.5(mu))          41%               43%
Advanced (less than 0.5(mu))   26%               21%
Support                        11%               13%

Business Review: o Backlog grew during the quarter. o Turns bookings averaged 64% for the quarter. o At the end of the quarter, accounts receivables were $80.7M, or 44 days of sales outstanding, up slightly from $74.1M, or 43 days of sales outstanding reported at the end of the September quarter. o Inventory days at Xilinx were approximately 66 days. This represents a 27% decrease from 90 days reported in the prior quarter. Inventory days at worldwide distributors were approximately 65 days, down from approximately 75 days reported in the prior quarter. o For the first time in the Company's history, total assets exceeded $1 billion. o Capital expenditures and depreciation were approximately $11.1 million and $8.4 million, respectively, during the quarter. o On January 8, 1999, the Company announced its intention to redeem in full its 5 1/4% convertible subordinated notes due 2002. Product News: o During the December quarter, Xilinx commenced volume shipments of two members of its next generation of FPGAs: the Virtex series. This family is the industry's first to achieve densities of up to one million system gates and is designed to address the challenges faced by system-level designers. o In November, Xilinx announced its Internet-based Silicon Xpresso initiative that enables Xilinx customers to leverage the Internet and the Java programming language in developing and deploying their products. As part of this initiative, Xilinx recently announced the availability of WebFitter, the industry's first Internet-based CPLD design tool. o In November, Xilinx and UMC Group announced the co-development of the PLD industry's first 0.18(mu) prototype. FMI: http://www.xilinx.com/finance/irpage.htm. Xilinx is the leading innovator of complete programmable logic solutions, including advanced integrated circuits, software design tools, predefined system functions delivered as cores, and field engineering support. Founded in 1984 and headquartered in San Jose, Calif., Xilinx invented the field programmable gate array (FPGA) and commands more than half of the world market for these devices today. Xilinx solutions enable customers to reduce significantly the time required to develop products for the computer, peripheral, telecommunications, networking, industrial control, instrumentation, high-reliability/military, and consumer markets. For more information, visit the Xilinx web site at www.xilinx.com.