Xilinx, Inc. reports 25.5% Net Income decline in 2018 while 5.0% Revenue growth
04/25/2018 • About Xilinx, Inc. (
$XLNX) • By InTwits
Xilinx, Inc. reported FY2018 financial results today. Here are the key drivers of the company's long term financial model:
- Xilinx, Inc. has low CAPEX intensity: 5 year average CAPEX/Revenue was 2.0%. At the same time it's a lot of higher than industry average of 5.2%.
- CAPEX is quite volatile: $50m in FY2018, $72m in FY2017, $34m in FY2016, $30m in FY2015, $45m in FY2014
- In the last 5 years the company invested considerably less than D&A: $230m vs. $378m. In FY2018 this situation was still the same: CAPEX was 50 while D&A was 97
- The company has highly profitable business model: ROIC is 16.6%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
Xilinx, Inc.'s Revenue increased on 5.0%. Revenue growth showed small slowdown in FY18Q4 - it was 4.7% YoY. Despite revenue decline the EBITDA margin expanded. EBITDA Margin surged on 15.7 pp from 20.9% to 36.5% in 2018. EBITDA Margin stuck to a declining trend at -0.82 pp per annum in FY2014-FY2018.
Gross Margin showed almost no change in FY2018. SG&A as a % of Revenue showed almost no change in FY2018. Stock Based Compensation (SBC) as a % of Revenue increased slightly on 1.0 pp from 5.2% to 6.2% in FY2018. SBC as a % of Revenue stuck to a growing trend at 0.82 pp per annum in the last 5 years.
Net Income margin decreased on 7.7 pp from 26.5% to 18.8% in FY2018. The efficient tax rate was 32.9% in FY2018 while the average for the last five years was 15.9%.
Investments (CAPEX, working capital and M&A)
Xilinx, Inc.'s CAPEX/Revenue was 2.0% in FY2018. The company's CAPEX/Revenue increased slightly on 0.78 pp from 1.2% in FY2015 to 2.0% in FY2018. It's average CAPEX/Revenue for the last three years was 2.2%.
Accounts receivable as a % of Revenue increased on 5.1 pp from 10.4% to 15.5% in FY2018. Inventories as a % of Revenue showed almost no change at 9.6% in FY2018. Accounts payable as a % of Revenue decreased slightly on 2.0 pp from 15.3% to 13.3% in FY2018.
Xilinx, Inc. has spent
$1m on M&A in FY2018 which accounts for 0.055% of revenue.
Return on investment
The company operates at good ROIC (16.6%) and ROE (19.1%). ROIC showed almost no change in FY2018. ROE decreased on 5.4 pp from 24.4% to 19.1% in FY2018. During the last 5 years ROIC bottomed in FY2016 at 15.2% and was growing since that time.
Leverage (Debt)
Company's Net Debt / EBITDA is -0.6x and Debt / EBITDA is 2.2x. Debt surged on 18.1% while cash jumped on 125%.
Xilinx, Inc. has good short term financial stability: Interest coverage ratio (ICR) is 15.0x. Xilinx, Inc. has no short term refinancing risk: cash is higher than short term debt (436.6%).
Average interest expence paid by the company was 2.7% in FY2018.
Valuation and dividends
The company's trades at EV/EBITDA 20.5x and P/E 35.6x.
The company paid 76.1% of Net Income as dividends in FY2018. Dividends grew on average at 5.7% per annum in the last 5 years).
Management team
Victor Peng is a the company's CEO. Victor Peng is a founder and has spent 1 year with the company. CEO total compensation was
$26,851,802 in FY2018 which included
$1,246,475 salary. Xilinx, Inc.'s CFO Lorenzo A Flores has spent 3 years with the company.
At the end of financial year the company had 0.22% shares owned by insiders. Insider ownership didn't change in 2018.
The company has 4,014 employees. The number of employees increased on 4.8%. Average revenue per employee in FY2018 was
$614,605 and it showed almost no change in 2018.
Financial and operational results
FY ended 03/31/2018
Xilinx, Inc. ($XLNX) key annual financial indicators| mln. $ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 2,383 | 2,377 | 2,214 | 2,349 | 2,467 | 5.0% |
| Gross Profit | 1,639 | 1,669 | 1,542 | 1,641 | 1,724 | 5.0% |
| SG&A | 379 | 354 | 332 | 335 | 362 | 8.1% |
| EBITDA | 824 | 830 | 738 | 762 | 783 | 2.7% |
| EBIT | 749 | 755 | 670 | 699 | 686 | -1.9% |
| Interest expence | 54 | 55 | 55 | 54 | 46 | -15.0% |
| Tax | 79 | 92 | 86 | 69 | 227 | 231.6% |
| Net Income | 630 | 648 | 551 | 623 | 464 | -25.5% |
| Stock Based Compensation | 64 | 100 | 112 | 123 | 154 | 25.2% |
Balance Sheet
|
|---|
| Cash | 974 | 893 | 504 | 967 | 2,179 | 125.4% |
| Accounts Receivable | 268 | 247 | 307 | 244 | 382 | 56.7% |
| Inventory | 234 | 231 | 179 | 227 | 236 | 4.0% |
| Accounts Payable | 150 | 80 | 102 | 108 | 99 | -8.6% |
| Short Term Debt | 565 | 576 | 585 | 456 | 499 | 9.4% |
| Long Term Debt | 994 | 995 | 994 | 995 | 1,214 | 22.0% |
Cash flow
|
|---|
| Capex | 45 | 30 | 34 | 72 | 50 | -30.7% |
| Dividends | 267 | 306 | 319 | 333 | 353 | 6.0% |
| Acquisitions | | | | | 1 | |
Ratios
|
|---|
| Revenue growth | 9.9% | -0.2% | -6.9% | 6.1% | 5.0% | |
| EBITDA growth | 26.0% | 0.7% | -11.0% | 3.2% | 2.7% | |
|
|---|
| Gross Margin | 68.8% | 70.2% | 69.7% | 69.9% | 69.9% | 0.0% |
| EBITDA Margin | 34.6% | 34.9% | 33.3% | 32.4% | 31.7% | -0.7% |
| EBIT Margin | 31.4% | 31.8% | 30.3% | 29.8% | 27.8% | -2.0% |
| SG&A, % of revenue | 15.9% | 14.9% | 15.0% | 14.3% | 14.7% | 0.4% |
| SBC, % of revenue | 2.7% | 4.2% | 5.1% | 5.2% | 6.2% | 1.0% |
| Net Income Margin | 26.5% | 27.3% | 24.9% | 26.5% | 18.8% | -7.7% |
| CAPEX, % of revenue | 1.9% | 1.2% | 1.5% | 3.1% | 2.0% | -1.0% |
|
|---|
| ROIC | 17.1% | 16.9% | 15.2% | 16.3% | 16.6% | 0.4% |
| ROE | 22.1% | 24.2% | 21.2% | 24.4% | 19.1% | -5.4% |
| Net Debt/EBITDA | 0.7x | 0.8x | 1.5x | 0.6x | -0.6x | -1.2x |
| Interest expence / Average debt | 3.5% | 3.5% | 3.5% | 3.6% | 2.7% | -0.9% |
People
|
|---|
| Insider ownership | 0.2% | 0.2% | 0.2% | 0.2% | 0.2% | 0.0% |
| Employees | 3,500 | 3,451 | 3,458 | 3,831 | 4,014 | 4.8% |
| Revenue/Employee, th. $ | 681 | 689 | 640 | 613 | 615 | 0.2% |
Xilinx, Inc. ($XLNX) key quoterly financial indicators
| mln. $ | FY18Q1 | FY18Q2 | FY18Q3 | FY18Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 603 | 627 | 599 | 638 | | 4.8% | 8.3% | 2.2% | 4.7% |
| EBITDA | 184 | 207 | 178 | 213 | | -8.7% | 8.0% | -0.4% | 12.5% |
| Net Income | 157 | 174 | -12 | 145 | | -3.6% | 5.8% | -108.8% | -5.2% |
Balance Sheet
|
|---|
| Cash | 1,059 | 1,070 | 911 | 2,179 | | 81.9% | 55.0% | 8.6% | 125.4% |
| Short Term Debt | 0 | 0 | 0 | 499 | | -100.0% | -100.0% | -100.0% | 9.4% |
| Long Term Debt | 1,737 | 1,739 | 1,730 | 1,214 | | 74.8% | 74.8% | 73.9% | 22.0% |
Ratios
|
|---|
| Gross Margin | 68.3% | 70.4% | 70.3% | 70.4% | | -2.4% | 0.8% | 0.7% | 0.9% |
| EBITDA Margin | 30.5% | 33.0% | 29.8% | 33.4% | | -4.5% | -0.1% | -0.8% | 2.3% |
| Net Income Margin | 26.1% | 27.7% | -2.1% | 22.8% | | -2.3% | -0.7% | -26.3% | -2.4% |
Peers in Semiconductors
Below you can find Xilinx, Inc. benchmarking vs. other companies in Semiconductors industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by Revenue growth, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| NanoFlex Power Corp ($OPVS) | | | | 72.5% | 354.8% |
| MoSys, Inc. ($MOSY) | | -18.4% | 37.2% | 46.8% | 87.7% |
| SMART Global Holdings, Inc. ($SGH) | | | -16.9% | 42.5% | 69.3% |
| Micron Technology, Inc. ($MU) | | -1.0% | -23.4% | 63.9% | 49.5% |
| Adesto Technologies Corporation ($IOTS) | | 4.3% | 1.6% | 27.6% | 48.8% |
| |
|---|
| Median (67 companies) | 54.6% | 9.7% | 5.2% | 11.0% | 4.7% |
|---|
| Xilinx, Inc. ($XLNX) | | -0.2% | -6.9% | 6.1% | 5.0% |
Top companies by Gross margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| CEVA, Inc. ($CEVA) | 90.2% | 90.9% | 91.6% | 92.1% | 89.8% |
| NVE Corporation ($NVEC) | 77.9% | 80.3% | 76.1% | 78.5% | 79.0% |
| Rambus, Inc. ($RMBS) | 85.9% | 84.7% | 80.1% | 79.9% | 76.8% |
| Universal Display Corporation ($OLED) | 76.0% | 64.2% | 83.9% | 80.8% | 75.5% |
| Intermolecular, Inc. ($IMI) | 48.3% | 57.4% | 66.5% | 67.5% | 70.3% |
| |
|---|
| Median (65 companies) | 45.3% | 47.0% | 47.2% | 48.6% | 50.4% |
|---|
| Xilinx, Inc. ($XLNX) | 68.8% | 70.2% | 69.7% | 69.9% | 69.9% |
Top companies by EBITDA margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| NVE Corporation ($NVEC) | 58.8% | 66.0% | 61.8% | 65.6% | 65.1% |
| Micron Technology, Inc. ($MU) | 31.7% | 35.0% | 25.4% | 47.9% | 65.0% |
| NXP Semiconductors N.V. ($NXPI) | 25.7% | 41.5% | 21.6% | 46.2% | 49.9% |
| Texas Instruments Incorporated ($TXN) | 39.7% | 42.0% | 43.5% | 46.7% | 48.6% |
| Intel Corp ($INTC) | 42.8% | 41.0% | 35.2% | 41.7% | 45.7% |
| |
|---|
| Median (66 companies) | 9.6% | 11.3% | 9.2% | 10.7% | 9.8% |
|---|
| Xilinx, Inc. ($XLNX) | 34.6% | 34.9% | 33.3% | 32.4% | 31.7% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Alpha and Omega Semiconductor Limited ($AOSL) | 3.0% | 6.6% | 6.5% | 12.2% | 42.2% |
| Renesola Ltd. ($SOL) | 3.5% | 0.0% | 0.0% | 78.0% | 41.7% |
| First Solar, Inc. ($FSLR) | 7.6% | 4.0% | 7.9% | 17.5% | 33.0% |
| Sigma Designs Inc ($SIGM) | 11.0% | 6.5% | 6.2% | 14.1% | 29.3% |
| Micron Technology, Inc. ($MU) | 19.0% | 24.8% | 46.9% | 23.3% | 29.2% |
| |
|---|
| Median (66 companies) | 3.6% | 4.0% | 3.7% | 4.7% | 4.6% |
|---|
| Xilinx, Inc. ($XLNX) | 1.9% | 1.2% | 1.5% | 3.1% | 2.0% |
Top companies by ROIC, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| SMART Global Holdings, Inc. ($SGH) | | | 2.5% | 21.5% | 51.7% |
| Texas Instruments Incorporated ($TXN) | 25.1% | 29.8% | 34.9% | 43.1% | 47.5% |
| Micron Technology, Inc. ($MU) | 18.8% | 15.8% | 0.8% | 21.5% | 42.9% |
| Applied Materials Inc ($AMAT) | 15.8% | 15.2% | 19.0% | 31.2% | 36.4% |
| NVIDIA Corporation ($NVDA) | 9.2% | 13.3% | 13.1% | 27.3% | 35.3% |
| |
|---|
| Median (73 companies) | 5.0% | 3.8% | 1.4% | 3.2% | 3.0% |
|---|
| Xilinx, Inc. ($XLNX) | 17.1% | 16.9% | 15.2% | 16.3% | 16.6% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| MACOM Technology Solutions Holdings, Inc. ($MTSI) | 25.4x | 3.3x | 3.0x | 7.2x | 98.6x |
| Inphi Corporation ($IPHI) | | -6.4x | 4.5x | 33.7x | 32.2x |
| JinkoSolar Holding Company Limited ($JKS) | 4.2x | 3.3x | 4.1x | 11.0x | 8.2x |
| Lattice Semiconductor Corporation ($LSCC) | -1.8x | | 6.5x | 19.0x | 3.9x |
| Renesola Ltd. ($SOL) | 7.0x | 35.0x | 123.6x | 2.3x | 3.3x |
| |
|---|
| Median (45 companies) | -0.6x | -0.3x | -0.0x | 0.4x | 0.3x |
|---|
| Xilinx, Inc. ($XLNX) | 0.7x | 0.8x | 1.5x | 0.6x | -0.6x |
