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Xilinx Announces First Quarter Fiscal 2009 Results; Sales Increase 3% Sequentially

- Record sales of $488.2 million in fiscal Q1 - Gross margin of 63.8% - Industrial and Other sales reach record level

SAN JOSE, Calif., July 16 /PRNewswire-FirstCall/ -- Xilinx, Inc. (NASDAQ: XLNX) today announced record net revenues of $488.2 million in the first quarter of fiscal 2009, up 3% sequentially from the prior quarter and up 9% compared to the same quarter a year ago. First quarter net income was $83.9 million, or $0.30 per diluted share, including previously announced pre-tax restructuring charges of $19.5 million as well as a pre-tax charge of $4.6 million related to impairment losses on equity investments. Collectively these charges totaled $24.1 million, or approximately $0.07 per diluted share.

(Logo: http://www.newscom.com/cgi-bin/prnh/20020822/XLNXLOGO)

The Xilinx Board of Directors declared a quarterly cash dividend of $0.14 per outstanding share of common stock, payable on August 27, 2008 to all stockholders of record at the close of business on August 6, 2008.

    Additional first quarter comparisons are represented in the charts below:


    GAAP Results
    (In millions, except EPS)
                                                                Growth Rates
                        Q1 FY 2009   Q4 FY 2008   Q1 FY 2008   Q-T-Q    Y-T-Y
    Net revenues          $488.2        $475.8      $445.9       3%       9%
    Operating income      $107.0        $117.0       $97.5      -9%      10%
    Net income             $83.9         $96.5       $84.3     -13%       0%
    Diluted earnings
     per share             $0.30         $0.34       $0.28     -12%       7%

Sales from New Products increased 15% sequentially in the June quarter representing 42% of total sales, up from 28% in the same quarter a year ago. Virtex(R)-4 FPGA sales were particularly strong during the quarter driven by applications in the communications, defense and medical end markets.

Sales from the Asia Pacific region increased 15% sequentially in the June quarter reaching a record 32% of total sales, up from 29% in the same quarter a year ago. Strong sales growth was driven primarily by communications customers within the region as well as US-based communications customers with manufacturing operations in Asia Pacific.

"We reported a solid quarter in spite of macroeconomic headwinds," said Moshe Gavrielov, Xilinx President and Chief Executive Officer. "In addition to achieving record sales in the June quarter, our gross margin continued to improve due to disciplined efforts in the areas of yield improvement and cost reduction. Gross margin in the June quarter was 63.8%, up from 63.4% in the prior quarter and up from 62.2% in the same quarter a year ago."


    Net Revenues by Geography:
                               Percentages                  Growth Rates
                        Q1         Q4         Q1
                      FY 2009    FY 2008    FY 2008        Q-T-Q     Y-T-Y
    North America       35%        38%       39%            -4%       -1%
    Asia Pacific        32%        28%       29%            15%       21%
    Europe              23%        23%       22%             1%       14%
    Japan               10%        11%       10%            -3%        9%


    Net Revenues by End Market:
                                    Percentages             Growth Rates
                              Q1        Q4        Q1
                            FY 2009   FY 2008   FY 2008    Q-T-Q     Y-T-Y
    Communications            42%       42%       45%        3%        2%
    Industrial & Other        33%       33%       32%        5%       16%
    Consumer & Automotive     16%       17%       15%       -2%       13%
    Data Processing            9%        8%        8%        3%       17%


    Net Revenues by Product*:
                                  Percentages                   Growth Rates
                            Q1         Q4          Q1
                          FY 2009    FY 2008     FY 2008      Q-T-Q     Y-T-Y
    New                     42%        38%         28%         15%        64%
    Mainstream              40%        42%         50%         -2%       -12%
    Base                    12%        14%         16%        -14%       -19%
    Support                  6%         6%          6%         -5%         8%

    *Products are classified as follows:

    New Products: Virtex-5, Virtex-4, Spartan(R)-3, and CoolRunner(TM)-II
     products
    Mainstream Products: Virtex-II, Spartan-II, CoolRunner and Virtex-E
     products
    Base Products: Virtex, Spartan, XC4000 and XC9500 products
    Support Products: Configuration solutions, HardWire, Software &
     Support/Services


    Highlights -- June Quarter Fiscal 2009

-- Sales from products manufactured using 90nm and 65nm process technologies reached record levels in the June quarter exceeding 40% of total sales, up from 26% in the same quarter a year ago. Xilinx's successful introduction of the Virtex-5 family in May 2006 has enabled the Company to achieve significant 65nm sales leadership over PLD competitors. Xilinx estimates that it currently supplies approximately 90% of the PLD industry's 65nm sales. Virtex-5 devices continue to generate strong design win momentum across a broad range of end markets.

-- Industrial and Other sales reached record levels in the June quarter driven by growth from the defense, industrial, scientific and medical applications. Xilinx FPGAs are ideally suited for many of the applications in this space due to their high DSP performance, embedded processing functionality and integration capabilities. Sales from Industrial and Other applications represented 33% of total sales in the June quarter, up from 22% three years ago.


    Key Statistics:
                                            Q1          Q4            Q1
                                         FY 2009      FY 2008      FY 2008

    Annual Return on Equity (%)*            20           22           18

    Operating Cash Flow ($M)               158          102          126

    Depreciation Expense ($M)               15           14           12
    Capital Expenditures ($M)               10            6           16

    Combined Inventory Days                 93           92          101

    Revenue Turns (%)                       59           60           57

    *Return on equity calculation: Annualized net income/average stockholders'
     equity


    Business Outlook -- September Quarter Fiscal 2009

    -- Revenues are expected to be between up 1% to down 3% sequentially.
    -- Gross margin is expected to be in the range of 63% to 64%.
    -- Operating expenses are expected to be approximately $180 million
       including $1 million to $2 million of previously announced
       restructuring charges.
    -- Other income including interest expense is expected to be approximately
       $5 million.
    -- Tax rate is expected to be approximately 22%.
    -- Fully diluted share count is expected to be approximately 277 million
       shares.

This release contains forward-looking statements and projections. Forward-looking statements and projections can often be identified by the use of forward-looking words such as "expect," "may," "will," "could," "believe," "anticipate," "estimate," "continue," "plan," "intend," "project" or other similar words. Undue reliance should not be placed on such forward-looking statements and projections, which speak only as of the date they are made. We undertake no obligation to update such forward-looking statements. Actual events and results may differ materially from those in the forward-looking statements and are subject to risks and uncertainties including the general health of global economies as well as of the semiconductor industry, the health of our end markets and our customers' customers, our ability to forecast end customer demand, customer acceptance of our new products, the ability of our customers to manage their inventories, a high dependence on turns business, more customer volume discounts than expected, greater product mix changes than anticipated, fluctuations in manufacturing yields, our ability to deliver product in a timely manner, our ability to successfully manage production at multiple foundries, variability in wafer pricing, and other risk factors listed in our most recent Form 10-K.

About Xilinx

Xilinx, Inc. (NASDAQ: XLNX) is the worldwide leader of programmable logic solutions. Additional information about Xilinx is available at http://www.xilinx.com.

Xilinx, the Xilinx logo, Virtex, Spartan, ISE, and other brands designated herein are trademarks of Xilinx in the United States and other countries. All other trademarks are the property of their respective owners.

    #0866F

     Investor Relations Contact:
     Lori Owen
     Xilinx, Inc.
     (408) 879-6911
     ir@xilinx.com



    XILINX, INC.
    CONDENSED CONSOLIDATED STATEMENTS OF INCOME
    (Unaudited)
    (In thousands, except per share amounts)

                                                    Three Months Ended
                                             June 28,   March 29,    June 30,
                                              2008        2008        2007
    Net revenues                            $488,246    $475,760    $445,912
    Cost of revenues                         176,506     173,974     168,478
    Gross margin                             311,740     301,786     277,434
    Operating expenses:
       Research and development               90,734      90,888      87,870
       Selling, general and
        administrative                        93,004      92,469      90,199
       Amortization of acquisition-
        related intangibles                    1,425       1,426       1,897
       Restructuring charges                  19,536         -           -
          Total operating expenses           204,699     184,783     179,966

    Operating income                         107,041     117,003      97,468
    Impairment loss on investments            (4,621)     (2,850)        -
    Interest and other, net                    5,705       5,328      13,533

    Income before income taxes               108,125     119,481     111,001
    Provision for income taxes                24,196      23,002      26,723
    Net income                               $83,929     $96,479     $84,278

    Net income per common share:
      Basic                                    $0.30       $0.34       $0.28
      Diluted                                  $0.30       $0.34       $0.28

    Cash dividends declared per common
     share                                     $0.14       $0.12       $0.12

    Shares used in per share calculations:
      Basic                                  278,165     284,523     297,720
      Diluted                                280,881     286,321     303,198



    XILINX, INC.
    CONDENSED CONSOLIDATED BALANCE SHEETS
    (In thousands)

                                                   June 28,          March 29,
                                                    2008               2008
                                                 (Unaudited)           (1)
    ASSETS
    Current assets:
      Cash, cash equivalents and short-
       term investments                         $1,238,713        $1,296,435
      Accounts receivable, net                     205,480           249,147
      Inventories                                  140,372           130,250
      Deferred tax assets and other
       current assets                              147,933           144,364
    Total current assets                         1,732,498         1,820,196
    Net property, plant and equipment              398,882           404,430
    Long-term investments                          607,253           564,269
    Other assets                                   352,422           348,212
    Total Assets                                $3,091,055        $3,137,107

    LIABILITIES AND STOCKHOLDERS' EQUITY
    Current liabilities:
      Accounts payable and accrued
       liabilities                                $237,681          $228,988
      Deferred income on shipments to
       distributors                                 99,789           111,678
    Total current liabilities                      337,470           340,666
    Convertible debentures                         999,552           999,851
    Deferred tax liabilities                       100,548            84,486
    Other long-term liabilities                     43,894            40,281
    Stockholders' equity                         1,609,591         1,671,823
    Total Liabilities and Stockholders'
     Equity                                     $3,091,055        $3,137,107

      (1) Derived from audited financial statements



    XILINX, INC.
    SUPPLEMENTAL FINANCIAL INFORMATION
    (Unaudited)
    (In thousands)
                                                     Three Months Ended
                                              June 28,   March 29,    June 30,
                                                2008       2008         2007

    SELECTED CASH FLOW INFORMATION:
      Depreciation                           $15,420     $13,876     $12,446
      Amortization                             4,226       4,219       4,605
      Stock-based compensation                14,164      17,697      16,521
      Net cash provided by operating
       activities                            158,497     101,841     126,324
      Purchases of property, plant and
       equipment                              (9,873)     (6,238)    (15,599)
      Payment of dividends to
       stockholders                          (38,928)    (34,093)    (35,718)
      Repurchases of common stock           (150,000)   (200,000)     -
      Proceeds from issuance of common
       stock to employees and excess tax
       benefit                                31,531      57,700      48,046

    STOCK-BASED COMPENSATION INCLUDED IN:
       Cost of revenues                       $1,582      $1,820      $2,171
       Research and development                6,354       8,908       7,301
       Selling, general and administrative     6,228       6,970       7,048

Web site: http://www.xilinx.com/