Broadcom Limited Announces First Quarter Fiscal Year 2016

Broadcom Limited Announces First Quarter Fiscal Year 2016 Financial Results

BROADCOM LIMITED
FINANCIAL RECONCILIATION: GAAP TO NON-GAAP - UNAUDITED
(IN MILLIONS, EXCEPT DAYS)


	Fiscal Quarter Ended
	January 31,			November 1,			February 1,
		2016			2015			2015


Net revenue on GAAP basis	$	1,771		$	1,840		$	1,635
Acquisition-related purchase accounting revenue adjustment		11			13			22
Net revenue on non-GAAP basis	$	1,782		$	1,853		$	1,657

Gross margin on GAAP basis	$	941		$	997		$	826
Acquisition-related purchase accounting revenue adjustment		11			13			22
Purchase accounting effect on inventory		-			-			4
Amortization of intangible assets		130			129			113
Share-based compensation expense		6			7			6
Restructuring charges		1			2			2
Acquisition-related costs		-			1			1
Gross margin on non-GAAP basis	$	1,089		$	1,149		$	974

Research and development on GAAP basis	$	267		$	287		$	235
Share-based compensation expense		28			30			19
Acquisition-related costs		1			-			6
Research and development on non-GAAP basis	$	238		$	257		$	210

Selling, general and administrative expense on GAAP basis	$	114		$	118		$	117
Share-based compensation expense		23			26			24
Acquisition-related costs		23			11			10
Selling, general and administrative expense on non-GAAP basis	$	68		$	81		$	83

Total operating expenses on GAAP basis	$	466		$	483		$	425
Amortization of intangible assets		54			63			59
Share-based compensation expense		51			56			43
Restructuring and disposal charges		31			15			14
Acquisition-related costs		24			11			16
Total operating expenses on non-GAAP basis	$	306		$	338		$	293

Operating income on GAAP basis	$	475		$	514		$	401
Acquisition-related purchase accounting revenue adjustment		11			13			22
Purchase accounting effect on inventory		-			-			4
Amortization of intangible assets		184			192			172
Share-based compensation expense		57			63			49
Restructuring and disposal charges		32			17			16		-
Acquisition-related costs		24			12			17
Operating income on non-GAAP basis	$	783		$	811		$	681

Interest expense on GAAP basis	$	(84	)	$	(41	)	$	(54	)
Acquisition-related costs		43			-			-
Interest expense on non-GAAP basis	$	(41	)	$	(41	)	$	(54	)

Other income, net on GAAP basis	$	3		$	12		$	4
Other		-			(2	)		-
Other income, net on non-GAAP basis	$	3		$	10		$	4

Income from continuing operations before income taxes on GAAP basis	$	394		$	485		$	351
Acquisition-related purchase accounting revenue adjustment		11			13			22
Purchase accounting effect on inventory		-			-			4
Amortization of intangible assets		184			192			172
Share-based compensation expense		57			63			49
Restructuring and disposal charges		32			17			16
Acquisition-related costs		67			12			17
Other		-			(2	)		-
Income before income taxes on non-GAAP basis	$	745		$	780		$	631

Provision for income taxes on GAAP basis	$	17		$	15		$	13
Income tax effects of non-GAAP reconciling adjustments		18			28			22
Provision for income taxes on non-GAAP basis	$	35		$	43		$	35

Net income on GAAP basis	$	377		$	429		$	351
Acquisition-related purchase accounting revenue adjustment		11			13			22
Purchase accounting effect on inventory		-			-			4
Amortization of intangible assets		184			192			172
Share-based compensation expense		57			63			49
Restructuring and disposal charges		32			17			16
Acquisition-related costs		67			12			17
Income tax effects of non-GAAP reconciling adjustments		(18	)		(28	)		(22	)
Discontinued operations, net of income taxes		-			41			(13	)
Other		-			(2	)		-
Net income on non-GAAP basis	$	710		$	737		$	596


Shares used in per share calculation - diluted on GAAP basis		289			287			278
Non-GAAP adjustment		6			7			7
Shares used in per share calculation - diluted on non-GAAP basis ⁽¹⁾		295			294			285

Days sales outstanding on GAAP basis		55			50			40
Non-GAAP adjustment		(1	)		-			(1	)
Days sales outstanding on non-GAAP basis ⁽²⁾		54			50			39

Inventory Days on Hand on GAAP basis		64			67			66
Non-GAAP adjustment		-			1			1
Inventory Days on Hand on non-GAAP basis ⁽³⁾		64			68			67


(1) The number of shares used in the diluted per share calculations on a non-GAAP basis excludes the impact of share-based compensation expense expected to be incurred in future periods and not yet recognized in the financial statements, which would otherwise be assumed to be used to repurchase shares under the GAAP treasury stock method.
(2) Days sales outstanding on a non-GAAP basis includes the impact of the acquisition-related purchase accounting revenue adjustment and excludes the impact of accounts receivable related to discontinued operations.
(3) Inventory days on hand on a non-GAAP basis excludes the impact of purchase accounting on inventory, amortization of intangible assets, share-based compensation expense, restructuring charges, acquisition-related costs, and cost of products sold attributable to discontinued operations.

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