SAN JOSE, Calif., July 25, 2018 -- Xilinx, Inc. (Nasdaq: XLNX) today announced record revenues of $684 million for the first quarter of fiscal year 2019, up 7% from the prior quarter and up 14% from first quarter of the prior fiscal year. June quarter net income was $190 million, or a record $0.74 per diluted share.
The Xilinx Board of Directors declared a quarterly cash dividend of $0.36 per outstanding share of common stock payable on August 28, 2018 to all stockholders of record at the close of business on August 8, 2018.
Additional first quarter of fiscal year 2019 comparisons are represented in the charts below. Due to the adoption of the new revenue recognition standard in the first quarter of fiscal year 2019, all prior period results have been restated to conform to the new standard:
GAAP Results
(In millions, except EPS)
| | Q1 FY 2019 | Q4 FY 2018 | Q1 FY 2018 | | Q-T-Q | Y-T-Y |
| Net revenues | $684 | $638 | $603 | | 7% | 14% |
| Operating income | $216 | $163 | $169 | | 32% | 28% |
| Net income | $190 | $145 | $157 | | 31% | 21% |
| Diluted earnings per share | $0.74 | $0.56 | $0.59 | | 32% | 25% |
"It's great to see our efforts to accelerate growth in our core markets pay off with a record revenue and earnings quarter. During the first quarter, we posted revenues of $684 million representing 14% year over year growth. Given the strength we see across our end markets, we are raising our revenue guidance for the full year to approximately 15% growth, compared to the prior year," said Victor Peng, President and Chief Executive Officer. "We made excellent progress executing to our Data Center strategy with significant design wins with hyperscalers, training an additional 500 AWS F1 developers and completing multiple investments in our ecosystem. We also acquired DeePhi Tech, an Artificial Intelligence (AI) company with innovative Deep Neural Network (DNN) technology for the cloud and the edge."
Net Revenues by Geography:
| | Percentages | Growth Rates |
| | Q1 FY 2019 | Q4 FY 2018 | Q1 FY 2018 | | Q-T-Q | Y-T-Y |
| North America | 28% | 31% | 29% | | (1%) | 12% |
| Asia Pacific | 45% | 39% | 44% | | 22% | 15% |
| Europe | 19% | 22% | 19% | | (5%) | 14% |
| Japan | 8% | 8% | 8% | | 2% | 12% |
Net Revenues by End Market:
The table below reflects our new market classification methodology that groups businesses with similar market drivers. Also, we believe, having four primary categories below provides additional visibility compared to the prior methodology.
| | Percentages | | Growth Rates | |
| | Q1 FY 2019 | Q4 FY 2018 | Q1 FY 2018 | | Q-T-Q | Y-T-Y | |
| Data Center and TME | 19% | 25% | 19% | | (20%) | 11% | |
| Automotive, Broadcast and Consumer | 16% | 15% | 17% | | 18% | 13% | |
| Communications | 31% | 31% | 38% | | 7% | (7%) | |
| Industrial, Aerospace & Defense | 33% | 35% | 28% | | 1% | 30% | |
| Channel | 1% | (6%) | (2%) | | NM | NM | |
Net Revenues by Product:
| | Percentages | | Growth Rates | |
| | Q1 FY 2019 | Q4 FY 2018 | Q1 FY 2018 | | Q-T-Q | Y-T-Y | |
| Advanced Products | 56% | 57% | 53% | | 6% | 21% | |
| Core Products | 44% | 43% | 47% | | 9% | 5% | |
Products are classified as follows:
Advanced Products: UltraScale+, Ultrascale and 7-series products.
Core Products: Virtex-6, Spartan-6, Virtex‐5, CoolRunner‐II, Virtex-4, Virtex-II, Spartan-3, Spartan-2, XC9500 products, configuration solutions, software & support/services.
Key Statistics:
(Dollars in millions)
| | Q1 FY 2019 | Q4 FY 2018 | Q1 FY 2018 |
| Annual Return on Equity (%)* | 32 | 19 | 24 |
| Operating Cash Flow | $176 | $242 | $191 |
| Depreciation Expense | $12 | $12 | $11 |
| Capital Expenditures (including software) | $26 | $21 | $10 |
| Combined Inventory Days | 113 | 117 | 112 |
| Revenue Turns (%) | 37 | 33 | 41 |
*Return on equity calculation: Annualized year to date net income/average stockholders' equity
Product and Financial Highlights – Fiscal First Quarter 2019
- Data Center and Test, Measurement & Emulation (TME) revenues, excluding cryptocurrency and TME, increased both sequentially and year over year. Data Center business momentum continued to strengthen with key design wins from hyperscalers globally for accelerating applications beyond FPGA as a Service (FaaS). Progress also continued on the AWS FaaS offering with the training of an additional 500 developers, bringing the cumulative number trained to date to over 900. We are on track to achieve our goal of over 1,500 developers trained by the end of the year.
- Xilinx recently acquired DeePhi Tech, strengthening the Company's capabilities in AI from the cloud to the edge. DeePhi Tech is a Beijing-based technology company with industry-leading capabilities in machine learning, specializing in compression, pruning, and system-level optimizations for neural networks. DeePhi has been developing its machine learning solutions on Xilinx platforms since their inception in 2016. In addition to the DeePhi acquisition, Xilinx made multiple investments in private companies during the quarter to expand the Xilinx ecosystem across a breadth of applications including data analytics, video transcoding and network intelligence.
- Highlighting the Company's continued transformation into a platform company, Zynq based revenues grew 76% year over year driven largely by a broad set of applications in Advanced Driver Assist (ADAS), Industrial, Communications, and Data Center. The Zynq SoC Platform, which includes Zynq at 28nm and both MPSoC and RFSoC at 16nm, now represents 17% of total revenues.
- Xilinx announced a partnership with Daimler AG for developing a custom AI inference platform. Powered by a Xilinx automotive platform consisting of SoC devices and AI acceleration software, the scalable solution will deliver high performance, low latency and power efficient embedded AI for automotive applications. Further, the Company has cumulatively shipped more than 50 million ADAS units to OEMs and Tier 1 suppliers.
- The Advanced Products category in the first quarter increased 21% year over year and constituted approximately 56% of total sales. Revenues from the 20nm node increased more than 30% year over year and the 16nm node continued its accelerated ramp with sales increasing over 2.5x during the same period.
- Everest, the industry's first Adaptive Compute Acceleration Platform (ACAP), has won the "Semiconductor of the Year 2018" award from Electronic Device Industry News, a Japanese news outlet. The Everest ACAP is a highly integrated multi-core heterogeneous compute platform that can be programmed at the hardware and software level. Xilinx remains on track to tape out Everest later this year.
Business Outlook – Fiscal Q2 2019 & Fiscal Year 2019
"We are raising our revenue guidance for the full year based on strong performance across our business. Our strategy is delivering significant results and we expect momentum to continue through the fiscal year," said Lorenzo Flores, Executive Vice President and Chief Financial Officer.
The following statements are based on current expectations, and as indicated, are presented on a GAAP and non-GAAP basis. These statements are forward-looking and actual results may differ materially, as a result of, among other things, the important factors discussed at the end of this release.
Fiscal Q2 2019
| | GAAP | Non-GAAP Adjustments | Non-GAAP |
| Revenues | $700M - $720M | - | $700M - $720M |
| Gross Margin | ~ 69.5% | - | ~ 69.5% |
| Operating Expenses | $281M | $2M (1) | $279M |
| Other Income | $11M | $8M (2) | $3M |
| Tax Rate | 10% - 14% | - | 10% -14% |
Fiscal Year 2019
| | GAAP | Non-GAAP Adjustments | Non-GAAP |
| Revenues | $2,800M - $2,900M | - | $2,800M - $2,900M |
| Gross Margin | 68.5% - 70.5% | - | 68.5% - 70.5% |
| Operating Expenses | $1,147M - $1,167M | $27M (3) | $1,120M - $1,140M |
| Other Income | $18M - $23M | $8M (2) | $10M - $15M |
| Tax Rate | 10% - 14% | - | 10% - 14% |
| Diluted Share count | 256M | | 256M |
Notes regarding Non-GAAP Adjustments:
(1) Excludes an estimated amount of $2 million in amortization of acquired intangibles and certain non-recurring expenses.
(2) Excludes an estimated amount of $8 million from an expected gain on an investment.
(3) Excludes an estimated amount of $27 million in amortization of acquired intangibles and certain non-recurring expenses.
About Xilinx
Xilinx develops highly flexible and adaptive processing platforms that enable rapid innovation across a variety of technologies – from the endpoint to the edge to the cloud. Xilinx is the inventor of the FPGA, hardware programmable SoCs and the ACAP, designed to deliver the most dynamic processor technology in the industry and enable the adaptable, intelligent and connected world of the future. For more information, visit www.xilinx.com.
