Xilinx Reports Third Quarter Fiscal Year 2021 Results

Xilinx Reports Third Quarter Fiscal Year 2021 Results Jan 27, 2021

Revenues of $803 million exceeded the high end of guidance, representing 5% sequential and 11% year over year growth

Wired and Wireless Group (WWG) revenue increased 14% sequentially due to strength in the Wireless markets as 5G deployments ramped in multiple regions

Automotive, Broadcast & Consumer (ABC) revenue increased 27% sequentially, driven by record quarters in the Automotive and Broadcast end markets

Aerospace & Defense, Industrial and Test, Measurement & Emulation (AIT) revenue increased 7% sequentially, driven by strong performance in the Test, Measurement and Emulation market

Data Center Group (DCG) revenue declined 45% sequentially, in line with expectations, compared to a record second quarter which benefited from trade-related order acceleration

Free cash flow of $354 million, representing 44% of revenue

Returned $93 million to stockholders through dividends

SAN JOSE, Calif.--(BUSINESS WIRE)-- Xilinx, Inc. (Nasdaq: XLNX), the leader in adaptive computing, today announced revenues of $803 million for the third quarter of fiscal year 2021.

GAAP net income for the quarter was $171 million, or $0.69 per diluted share. Non-GAAP net income was $194 million, or $0.78 per diluted share.

Additional third quarter of fiscal year 2021 comparisons are provided in the charts below.

Q3 Fiscal 2021 Financial Highlights

(In millions, except EPS)

GAAP

Q3

Q2

Q3

FY2021

FY2021

FY2020

Q-T-Q

Y-T-Y

Net revenues*

$803

$767

$723

5%

11%

Gross margin

$547

$542

$483

1%

13%

Operating income

$172

$205

$159

-16%

8%

Net income

$171

$194

$162

-12%

6%

Diluted earnings per share

$0.69

$0.79

$0.64

-13%

8%

Non-GAAP

Q3

Q2

Q3

FY2021

FY2021

FY2020

Q-T-Q

Y-T-Y

Net revenues*

$803

$767

$723

5%

11%

Gross margin

$554

$548

$492

1%

13%

Operating income

$201

$216

$174

-7%

16%

Net income

$194

$203

$171

-5%

14%

Diluted earnings per share

$0.78

$0.82

$0.68

-5%

15%

* No adjustment between GAAP and Non-GAAP

Third quarter revenues exceeded the high end of our guidance, delivering both sequential and annual growth, demonstrating strengthening business conditions and solid execution, said Victor Peng, Xilinx president and CEO. Our Wired and Wireless Group performed better than expected as 5G deployments ramped more meaningfully in North America. We achieved a record quarter in Automotive, Broadcast and Consumer end markets, driven by the ongoing economic recovery, as demand for automobiles strengthened and live media events returned. In addition, as expected, our first 7nm Versal ACAP has gone into production with a leading wireless OEM. We are excited to see the Versal product portfolio begin to contribute to Xilinx's long-term growth.

Our investments continue to deliver strong returns, with our Advanced Products growing 8% sequentially and representing 72% of total revenue, said Brice Hill, Xilinx CFO. We continue to drive our transformation to a platform company as demonstrated by our Zynq platform product revenue growing 24% sequentially, making up 27% of total revenue during the quarter. Our efficient financial model generated significant free cash flow of $354 million, or 44% of Q3 revenue.

Net Revenues by Geography:

Percentages

Growth Rates

Q3

Q2

Q3

FY2021

FY2021

FY2020

Q-T-Q

Y-T-Y

North America

30%

29%

28%

6%

16%

Asia Pacific

44%

48%

48%

-3%

4%

Europe

19%

18%

16%

12%

28%

Japan

7%

5%

8%

44%

2%

Net Revenues by End Market:

Percentages

Growth Rates

Q3

Q2

Q3

FY2021

FY2021

FY2020

Q-T-Q

Y-T-Y

A&D, Industrial and TME

45%

44%

40%

7%

25%

Automotive, Broadcast and Consumer

19%

16%

19%

27%

14%

Wired and Wireless Group

29%

26%

31%

14%

2%

Data Center Group

7%

14%

9%

-45%

-15%

Channel

0%

0%

1%

NM

NM

Net Revenues by Product:

Percentages

Growth Rates

Q3

Q2

Q3

FY2021

FY2021

FY2020

Q-T-Q

Y-T-Y

Advanced Products

72%

70%

70%

8%

15%

Core Products

28%

30%

30%

-3%

1%

Products are classified as follows:

Advanced Products: Alveo and related 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)

Q3

Q2

Q3

FY2021

FY2021

FY2020

Operating Cash Flow

$360

$248

$324

Depreciation Expense (including software amortization)

$31

$30

$26

Capital Expenditures (including software)

$6

$15

$34

Free Cash Flow (1)

$354

$232

$289

Inventory Days (internal)

115

114

124

Revenue Turns (%)

34

38

39

(1) Free Cash Flow = Operating Cash Flow - Capital Expenditures (including software)

Product and Financial Highlights - Fiscal Third Quarter 2021

Advanced Products represented 72% of total revenue, an 8% increase quarter over quarter and a 15% increase year over year. Zynq platform revenue grew 24% sequentially and 29% year over year, representing 27% of the total revenue. The sequential strength was driven by improvement in the Automotive and Broadcast end markets and the ramp of 5G in the Wireless end market.

Xilinx shipped its first production 7nm Versal ACAP parts to a leading wireless OEM, enabling the advanced signal processing performance and adaptability needed to deliver the next-generation 5G technologies like beamforming. Xilinx continues to make progress on broadening the Versal portfolio with additional Versal products in late-stage development.

Xilinx introduced Zynq RFSoC DFE, which combines hardened digital front-end (DFE) blocks and adaptable logic to build high-performance, low-power, and cost-effective 5G NR radio solutions for a broad array of use cases, ranging across low, mid and high-band spectrum.

Xilinx announced a collaboration with Te

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