CAVIUM, INC.

Unaudited Reconciliation of Non-GAAP Adjustments

(in thousands, except per share data and percentages)

Three Months Ended

December 31,
2017

September 30,
2017

Reconciliation of GAAP income (loss) from operations to non-GAAP income from operations:

GAAP income (loss) from operations

$

(12,133)

$

488

Stock-based compensation and related payroll taxes

26,443

27,351

Inventory charges

543

(18)

Amortization of acquisition related assets

29,873

29,950

Acquisition and integration related costs

18,176

4,740

Non-GAAP income from operations

$

62,902

$

62,511

Non-GAAP income from operations as a percentage of revenue

24.2

%

24.8

%

Reconciliation of GAAP net loss to non-GAAP net income:

GAAP net loss

$

(1,050)

$

(6,214)

Non-GAAP adjustments:

Stock-based compensation and related payroll taxes

26,443

27,351

Inventory charges

543

(18)

Amortization of acquisition related assets

29,873

29,950

Acquisition and integration related costs

18,176

4,740

Tax reform impact and acquisition related tax adjustment

(13,232)

-

Total of non-GAAP adjustments

61,803

62,023

Non-GAAP net income

$

60,753

$

55,809

GAAP net loss per share, diluted

$

(0.02)

$

(0.09)

Non-GAAP adjustments detailed above

0.85

0.85

Non-GAAP net income per share, diluted

$

0.83

$

0.76

GAAP weighted average shares, diluted

69,044

68,675

Non-GAAP share adjustment

4,190

4,488

Non-GAAP weighted average shares, diluted

73,234

73,163