(in millions) |
1Q 2020 |
1Q 2019 |
Year-Over-
|
4Q 2019 |
Sequential
|
||||||||||||||||
Cash Taxes, net of indemnification |
$ |
9.9 |
|
|
$ |
15.2 |
|
|
|
(35 |
)% |
$ |
16.7 |
|
|
|
(41 |
)% |
|||
Operating Cash Flow |
$ |
166.0 |
|
|
$ |
138.2 |
|
|
|
20 |
% |
$ |
91.7 |
|
|
|
81 |
% |
|||
Free Cash Flow |
$ |
33.7 |
|
($ |
18.8 |
) |
|
279 |
% |
($ |
20.7 |
) |
|
263 |
% |
||||||
SECOND QUARTER 2020 OUTLOOK
Based on product booking trends, backlog levels, and estimated turns levels, the Company anticipates 2020 second quarter revenue to be approximately $1,100 million to $1,260 million.
GAAP and Non GAAP gross margin for second quarter of 2020 is expected to be between 29 percent and 31 percent.
The 2020 second quarter outlook also includes anticipated stock-based compensation expense of approximately $19 million to $21 million. Net cash paid for income taxes is expected to be $10 million to $13 million.
The following table outlines ON Semiconductor's projected second quarter of 2020 GAAP and non-GAAP outlook.
|
Total ON Semiconductor
|
Special
|
Total ON Semiconductor
|
|
|
|
|
Revenue |
$1,100 to $1,260 million |
|
$1,100 to $1,260 million |
|
|
|
|
Gross Margin |
29.0% to 31.0% |
|
29.0% to 31.0% |
|
|
|
|
Operating Expenses |
$340 to $360 million |
$43 to $47 million |
$297 to $313 million |
|
|
|
|
| Other Income and Expense (including interest expense), net |
$42 to $45 million |
$9 to 10 million* |
$33 to $35 million |
|
|
|
|
| Diluted Share Count ** |
413 million |
|
413 million |
|
|
|
|
| * |
Convertible Notes, Non-cash Interest Expense is calculated pursuant to FASB's Accounting Standards Codification Topic 470: Debt. |
| ** |
Diluted share count can vary as a result of, among other things, the actual exercise of options or vesting of restricted stock units, the incremental dilutive shares from the Company's convertible senior subordinated notes, and the repurchase or the issuance of stock or convertible notes or the sale of treasury shares. In periods in which the quarterly average stock price per share exceeds $18.50, the non-GAAP diluted share count and non-GAAP net income per share include the impact of the Company’s hedge transactions issued concurrently with our 1.00% convertible notes. As such, at an average stock price per share between $18.50 and $25.96, the hedging activity offsets the potentially dilutive effect of the 1.00% convertible notes. In periods when the quarterly average stock price per share exceeds $20.72, the non-GAAP diluted share count and non-GAAP net income per share include the anti-dilutive impact of the Company’s hedge transactions issued concurrently with the 1.625% convertible notes. At an average stock price per share between $20.72 and $30.70, the hedging activity offsets the potentially dilutive effect of the 1.625% convertible notes. Both GAAP and non-GAAP diluted share counts are based on the Company’s stock price as of April 3, 2020. |
| *** |
Special items may include: amortization of acquisition-related intangibles; expensing of appraised inventory fair market value step-up; purchased in-process research and development expenses; restructuring, asset impairments and other, net; goodwill impairment charges; gains and losses on debt prepayment; non-cash interest expense; actuarial (gains) losses on pension plans and other pension benefits; and certain other special items, as necessary. These special items are out of our control and could change significantly from period to period. As a result, we are not able to reasonably estimate and separately present the individual impact or probable significance of these special items, and we are similarly unable to provide a reconciliation of the non-GAAP measures. The reconciliation that is unavailable would include a forward-looking income statement, balance sheet and statement of cash flows in accordance with GAAP. For this reason, we use a projected range of the aggregate amount of special items in order to calculate our projected non-GAAP operating expense outlook. |
| **** |
We believe these non-GAAP measures provide important supplemental information to investors. We use these measures, together with GAAP measures, for internal managerial purposes and as a means to evaluate period-to-period comparisons. However, we do not, and you should not, rely on non-GAAP financial measures alone as measures of our performance. We believe that non-GAAP financial measures reflect an additional way of viewing aspects of our operations that, when taken together with GAAP results and the reconciliations to corresponding GAAP financial measures that we also provide in our releases, provide a more complete understanding of factors and trends affecting our business. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures, even if they have similar names. |
