<PAGE>1
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM 10-Q
(Mark One)
[X] Quarterly Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the quarterly period ended October 2, 1995 or
[ ] Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the transition period from
__________to__________.
Commission file number 1-10079
-------
CYPRESS SEMICONDUCTOR CORPORATION
- - -------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 94-2885898
---------------------------- ---------------------------
(State or other jurisdiction (I.R.S. employer
of incorporation or identification No.)
organization)
3901 North First Street, San Jose, California 95134-1599
- - -------------------------------------------------------------------------------
(address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (408) 943-2600
----------------
NOT APPLICABLE
- - -------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since
last report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for at least the past 90 days.
Yes X No
--- ---
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
October 2, 1995 (all one class): 83,828,000
--------------------------------------------
1
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CYPRESS SEMICONDUCTOR CORPORATION
FORM 10-Q
Quarter Ended October 2, 1995
Index
Part I - Financial Information
- - --------------------------------
Item 1. Condensed Consolidated Financial Statements Pages 3 - 8
Item 2. Management's Discussion and Analysis Pages 9 - 12
Part II - Other Information
- - --------------------------------
Item 1. Legal Proceedings Page 13
Item 6. Exhibits and Reports on Form 8-K Pages 14 - 15
2
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<TABLE>
CYPRESS SEMICONDUCTOR CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
(Unaudited)
<CAPTION>
Oct. 2, Jan. 2,
1995 1995
---------- ----------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 3,706 $ 33,308
Short-term investments 179,948 159,967
---------- ----------
Total cash, cash equivalents and
short-term investments 183,654 193,275
Accounts receivable, net of allowances of
$1,893 at October 2, 1995 and $1,393 at
January 2, 1995 100,944 67,763
Inventories 29,521 28,372
Other current assets 31,251 27,704
---------- ----------
Total current assets 345,370 317,114
Property, plant and equipment (net) 304,384 201,590
Other assets 56,261 36,995
---------- ----------
Total assets $ 706,015 $ 555,699
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 64,218 $ 55,777
Accrued liabilities 43,542 22,258
Deferred income on sales to distributors 11,595 9,688
Income taxes payable 24,266 3,439
---------- ----------
Total current liabilities 143,621 91,162
Convertible subordinated notes 95,306 93,653
Deferred income taxes 11,209 11,209
Other long-term liabilities 6,199 6,676
---------- ----------
Total liabilities 256,335 202,700
---------- ----------
3
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CYPRESS SEMICONDUCTOR CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS (Continued)
(In thousands, except share data)
(Unaudited)
Oct. 2, Jan. 2,
1995 1995
---------- ----------
<S> <C> <C>
Commitments and contingencies (Note 4)
Stockholders' equity:
Preferred stock, $.01 par value, 5,000,000
shares authorized; none issued and
outstanding -- --
Common stock, $.01 par value, 250,000,000
shares authorized; 88,601,000 and
82,594,000 issued; 83,828,000 and
77,821,000 outstanding 886 826
Additional paid-in capital 267,967 238,272
Retained earnings 226,911 159,985
---------- ----------
495,764 399,083
Less shares of common stock held in
treasury, at cost: 4,773,000 at
October 2, 1995 and January 2, 1995 (46,084) (46,084)
---------- ----------
Total stockholders' equity 449,680 352,999
---------- ----------
Total liabilities and stockholders'
equity $ 706,015 $ 555,699
========== ==========
See accompanying notes to condensed consolidated financial statements.
</TABLE>
4
<PAGE>5
<TABLE>
CYPRESS SEMICONDUCTOR CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
(Unaudited)
<CAPTION>
Three Months Ended Nine Months Ended
---------------------- ----------------------
Oct. 2, Oct. 3, Oct. 2, Oct. 3,
1995 1994 1995 1994
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Revenues $ 161,155 $ 104,013 $ 418,793 $ 295,187
---------- ---------- ---------- ----------
Costs and expenses:
Cost of revenues 73,860 56,763 195,594 163,655
Research and development 18,305 13,402 50,367 39,596
Marketing, general and
administrative 17,908 13,246 50,705 39,150
Other non-recurring
costs (Note 4) -- -- 17,800 --
---------- ---------- ---------- ----------
Total operating costs
and expenses 110,073 83,411 314,466 242,401
---------- ---------- ---------- ----------
Operating income 51,082 20,602 104,327 52,786
Interest expense (1,560) (1,295) (4,708)
(2,623)
Interest and other income 1,215 2,299 5,774 4,928
---------- ---------- ---------- ----------
Income before income taxes 50,737 21,606 105,393 55,091
Provision for income taxes (18,518) (7,994) (38,467)
(20,384)
---------- ---------- ---------- ----------
Net income $ 32,219 $ 13,612 $ 66,926 $ 34,707
========== ========== ========== ==========
Net income per share:
Primary $ 0.35 $ 0.16 $ 0.75 $ 0.43
Fully diluted $ 0.33 $ 0.16 $ 0.71 $ 0.42
Weighted average common and
common equivalent shares
outstanding:
Primary 91,681 82,780 89,487 81,468
Fully diluted 99,621 90,720 97,824 86,881
See accompanying notes to condensed consolidated financial statements.
</TABLE>
5
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<TABLE>
CYPRESS SEMICONDUCTOR CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
<CAPTION>
Nine Months Ended
----------------------
Oct. 2, Oct. 3,
1995 1994
---------- ----------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 66,926 $ 34,707
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 44,433 33,364
Provision for other non-recurring costs 17,800 --
Non-cash interest and amortization of debt
issuance costs 1,963 996
Changes in operating assets and liabilities:
Receivables (32,140) (11,510)
Inventories (1,149) (1,895)
Other assets (13,347) 1,243
Accounts payable and accrued liabilities 11,447 24,670
Deferred income 1,907 94
Income taxes payable and deferred income taxes 20,827 1,589
---------- ----------
Net cash generated by operations 118,667 83,258
---------- ----------
Cash flows from investing activities:
Increase in short-term investments (net) (19,981) (149,127)
Acquisition of property, plant and equipment (143,969) (84,052)
Sale of plant and equipment -- 7,918
Acquisition of CONTAQ Microsystems, Inc. -- (969)
---------- ----------
Net cash used for investing activities (163,950) (226,230)
---------- ----------
Cash flows from financing activities:
Issuance of common stock 29,755 20,672
Restricted investments related to building lease
agreement (14,074) --
Issuance of convertible subordinated notes (net) -- 89,443
Other -- 525
---------- ----------
Net cash provided by financing activities 15,681 110,640
---------- ----------
Net decrease in cash and cash equivalents (29,602) (32,332)
Cash and cash equivalents, beginning of year 33,308 37,657
---------- ----------
Cash and cash equivalents, end of quarter $ 3,706 $ 5,325
========== ==========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
6
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CYPRESS SEMICONDUCTOR CORPORATION
Notes to Condensed Consolidated Financial Statements
(Unaudited)
1. Interim Statements
In the opinion of management, the accompanying, unaudited condensed
consolidated financial statements contain all adjustments (consisting solely of
normal recurring adjustments) necessary to present fairly the financial
information included therein. While the Company believes that the disclosures
are adequate to make the information not misleading, it is suggested that this
financial data be read in conjunction with the audited financial statements and
notes thereto for the year ended January 2, 1995 included in the Company's
1994 Annual Report on Form 10-K.
For interim financial reporting purposes, the Company reports on a 13-week
quarter. The results of operations for the three and nine month periods ended
October 2, 1995 are not necessarily indicative of the results to be expected
for the full year.
2. Inventories
October 2, January 2,
1995 1995
---------- ----------
Raw materials $ 8,475 $ 8,519
Work in process 15,943 12,325
Finished goods 5,103 7,528
---------- ----------
$ 29,521 $ 28,372
========== ==========
3. Net Income Per Share
Net income per share is computed using the weighted average number of shares of
outstanding common stock and common equivalent shares, when dilutive. Common
equivalent shares include shares issuable under the Company's stock option
plans as determined by the treasury stock method. Fully diluted earnings per
share assumes full conversion of the convertible subordinated notes into common
shares and the elimination of the related interest requirements (net of income
taxes).
4. Impact of Litigation
In the normal course of business, the Company receives and makes inquiries with
regard to possible patent infringement. Where deemed advisable, the Company
may seek or extend licenses or negotiate settlements.
In May 1995, in a case before the U.S. District Court in Dallas, Texas, a jury
delivered a verdict of $17.8 million against the Company in a patent
infringement lawsuit filed by Texas Instruments ("TI"). In August, the judge
reversed the decision stating TI failed to prove that Cypress infringed on TI's
7
<PAGE>8
patents covering the plastic encapsulation process used to package
semiconductor devices. TI has filed an appeal, in which the Company will
continue to defend itself. In the first quarter ended April 3, 1995 the
Company recorded a one-time pre-tax charge of $17.8 million with respect to
the original decision. The Company continues to hold this reserve pending
further resolution of this matter.
In June 1995, the U.S. District Court of Northern California dismissed by a
summary judgement the class-action lawsuit filed against the Company and
certain of its officers. The suit filed was for alleged violations of the
Securities Exchange Act of 1934 and certain provisions of state law regarding
disclosure of short-term business prospects. The plaintiffs have filed for an
appeal, in which the Company will continue to defend itself.
In June 1995, Advanced Micro Devices ("AMD") charged the Company with patent
infringement and filed suit in the U.S. District Court in Delaware. The suit
filed by AMD claims that the Company infringed on several of AMD's Programmable
Logic Patents. No trial date has been set.
The Company will vigorously defend itself in these lawsuits and, subject to
the inherent uncertainties of litigation and based upon discovery completed to
date, management believes that the possibility of a material adverse impact on
the Company's financial position as a result of these lawsuits is remote.
However, should the outcome of any of these actions be unfavorable, the
Company may be required to pay damages and other expenses, which could have a
material adverse effect on the Company's results of operations and financial
position.
5. Stock Dividend
In August 1995, the Company announced a two-for-one stock split in the form of
a 100% common stock dividend to stockholders of record as of October 19, 1995.
In October, the stockholders approved an amendment to the Company's Certificate
of Incorporation increasing the number of authorized common stock from
75,000,000 to 250,000,000 in conjunction with the stock dividend. Stockholders
of record as of October 19, 1995 will receive certificates representing one
additional share for every share held at that time. The shares were distributed
on October 31, 1995. All share and per share amounts in the accompanying
condensed consolidated financial statements and notes thereto have been adjusted
for all periods presented to give effect to this stock dividend except for the
amounts disclosed for treasury shares which, for accounting purposes, are stated
at their historical amounts.
8
<PAGE>9
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS:
- - --------------------------
Revenues for the quarter and nine month periods ended October 2, 1995 increased
54.9% and 41.9%, respectively, over the comparable periods a year ago,
increasing to $161.2 million and $418.8 million in 1995 compared to $104.0
million and $295.2 million in 1994. Market demand for the Company's products,
along with increased manufacturing capacity, has allowed revenues to grow each
quarter of 1995. Revenues generated from the sale of Static Random Access
Memory ("SRAM") products, particularly in the telecommunication and personal
computer markets, have increased significantly as the sales volume of SRAM
products in the first nine months of 1995 grew approximately 88% in comparison
to the first nine months last year. Revenues from the Company's Data
Communications Division ("Datacom") also increased period to period as demand
for Datacom's Specialty Memory and Channel line of products increased volume
by approximately 48% over the comparable period last year.
The Company's cost of revenues as a percentage of revenues for the quarter and
nine month periods ended October 2, 1995 decreased to 45.8% and 46.7%,
respectively, in comparison with 54.6% and 55.4%, respectively, for the
comparable periods in 1994. Manufacturing costs as a percentage of revenues
continue to decline due to lower unit cost experienced in backend manufacturing
(assembly and test), increased volume, resulting in lower fixed cost per unit
and a die size reduction program in the Company's domestic wafer fabrication
plants ("fab"). The increase in the corresponding gross margin was partially
offset by the significant growth in depreciation expense in manufacturing which
resulted from Fab IV achieving production status during the third quarter of
1995 and the purchase of manufacturing equipment throughout the Company to
expand capacity.
Research and development ("R & D") expenses were 11.4% and 12.0% of revenues
for the quarter and nine month periods ended October 2, 1995, versus 12.9% and
13.4% in the comparable periods for 1994. Although R & D spending increased
$4.9 million and $10.8 million, respectively, from the comparable quarter and
nine month periods in the prior year, its rate of growth has been less than
the rate of growth in revenues. The Company expects R & D spending to continue
to increase in absolute dollars as a consequence of opening two new design
centers in Austin, Texas and Bangalore, India, and increased activity in many
of its existing design centers to develop new products and process
technologies.
Selling, general and administrative ("SG&A") expenses as a percent of revenues
for the quarter and nine month periods ended October 2, 1995 decreased to
11.1% and 12.1%, respectively, compared to 12.7% and 13.3%, respectively, in
the comparable periods a year ago. Although absolute spending in SG&A
increased from the prior year, the rate of growth has been less than the rate
of growth in revenues. The Company has incurred increased costs related
primarily to the growth in sales and marketing efforts by increasing headcount
and associated spending in order to support its Field Programmable Gate Array
("FPGA") and Complex Programmable Logic Device ("CPLD") product families. The
Company expects absolute spending in sales and marketing to continue to
increase.
9
<PAGE>10
General and administrative expense for the first nine months of 1995 increased
31.2% in comparison to the comparable period in 1994. The Company incurred
legal expenditures in excess of those normally incurred related to the Texas
Instruments and the shareholders class-action lawsuits (Note 4).
Operating income for the quarter and nine month periods ended October 2, 1995
was $51.1 million, or 31.7% of revenues, and $104.3 million, or 24.9% of
revenues, respectively. This is an increase from the comparable periods in
1994 which recorded operating income of $20.6 million, or 19.8% of revenues,
and $52.8 million, or 17.9% of revenues, respectively. Revenue growth and
improved gross margins have led to record operating income. During the first
quarter of 1995, the Company recorded a one-time charge of $17.8 million
($11.3 million net of taxes) related to the verdict issued against the Company
in the patent infringement lawsuit filed by Texas Instruments. Although the
verdict was reversed in favor of the Company in August, the Company continues
to hold the reserve pending further resolution of this matter. Without the
one-time charge, operating income for the nine month period ended October 2,
1995 would have been $122.1 million, or 29.2% of revenues.
For the quarter ended October 2, 1995, the Company recorded net interest and
other expense of $0.3 million compared to net interest and other income of
$1.0 million in the comparable period for 1994. The Company recorded a $1.2
million loss from foreign exchange transactions in the third quarter of 1995,
primarily related to accounts receivable recorded in yen. In the third
quarter of 1994, the Company recorded a foreign exchange gain of $0.3 million.
For the nine month period ended October 2, 1995, the Company recorded net
interest and other income of $1.1 million, compared to $2.3 million recorded
in the comparable period in 1994. The decrease in net interest and other
income in the first nine months of 1995 compared to the comparable period in
1994 is attributed to the declining value of the yen in which the Company
recorded a foreign exchange transaction loss of $0.4 million compared to a
$0.8 million foreign transaction gain recorded in the first nine months of the
prior year.
FACTORS AFFECTING FUTURE RESULTS:
- - -----------------------------------
A number of uncertainties exist that could have an impact on the Company's
future results of operations, including general economic conditions, the rate
of growth of the networking, computer and telecommunications markets, the
ramping up of manufacturing capacity and the acceleration of new product
introductions. The Company's products continue to experience increased
competition and as a result, are subject to decreases in average selling prices.
Typically, the Company requires new orders in a quarter to meet that quarter's
revenue plan. In addition, the semiconductor industry is generally
characterized by a highly competitive, rapidly changing environment, where
results are often significantly impacted by the introduction of new products
and new manufacturing technologies. Also, rapid changes in the demand for
products can lead to unpredictability in quarterly revenues. Due to the
effect of these forces on the Company's future operations, past performance
should be only one indicator of future performance and investors should not use
historical trends to anticipate results in future periods. Current pending
litigation and claims are set forth in Note 4 of the Notes to the Condensed
10
<PAGE>11
Consolidated Financial Statements. The Company plans to vigorously defend
itself in these matters and, subject to the inherent uncertainties of
litigation and based upon discovery completed to date, management believes
that the possibility of a material adverse impact on the Company's financial
position as a result of these lawsuits is remote. However, should the outcome
of any of these actions be unfavorable, the Company may be required to pay
damages and other expenses, which could have a material adverse effect on the
Company's financial position. In addition, the Company could be required to
alter certain of its production processes or products as a result of these
matters.
LIQUIDITY AND CAPITAL RESOURCES:
- - ---------------------------------
The Company's financial condition remained strong throughout the first nine
months of 1995. Cash, cash equivalents and short-term investments totaled
$183.7 million at October 2, 1995, a decrease of $9.6 million compared to the
end of 1994. The decrease in cash, cash equivalents and short-term
investments is primarily due to the purchase of capital equipment. During the
first nine months of 1995, the use of cash from investing activities was
significantly offset by the increase in cash from operations and financing
activities.
During the first nine months of 1995, the Company generated $118.7 million in
cash from operations, compared to $83.3 million generated during the
comparable period in 1994. A majority of the increase in cash from operations
is attributable to the significant increase in revenues and earnings recorded
in the first nine months of 1995.
Cash used for investing activity was $164.0 million for the nine month period
ending October 2, 1995 compared to a cash use for investing activities of
$226.2 million for the comparable period in 1994. During the first nine
months of 1995, the Company purchased $144.0 million in capital equipment,
primarily to increase capacity in the Company's production fabrication
facilities (fabs) in Minnesota, Texas and San Jose. Purchases of capital
equipment for the next six months are expected to be approximately $170.0
million as the Company continues to buy equipment to expand capacity,
particularly in backend manufacturing.
Cash generated from financing activity for the first nine months of 1995 was
$15.7 million compared to $110.6 million generated in 1994 over the same
period of time. In 1994, the Company received $89.4 million from the issuance
of the Company's 3.15% Convertible Subordinated Notes due 2001. In 1995, cash
from financing activities was primarily generated through the exercise of
employee stock options.
In May 1995, in a case before the District Court in Dallas, Texas, a jury
delivered a verdict of $17.8 million against the Company in a patent
infringement lawsuit filed by Texas Instruments. In August, the judge
reversed the decision. The plaintiff has filed an appeal which is pending.
In the first quarter of 1995, the Company recorded a one-time pretax charge of
$17.8 million with respect to the original decision. The Company continues to
hold this reserve pending further resolution of this matter.
11
<PAGE>12
In 1994, the Company entered into three operating lease agreements with
respect to its office and manufacturing facilities in San Jose and Minnesota.
These agreements require quarterly payments which vary based on the London
interbank offering rate (LIBOR). These leases provide the Company with the
option of either acquiring the properties at their original cost or arranging
for the property to be acquired at the end of the respective lease terms. The
Company must maintain a specific level of restricted cash or investments to
serve as collateral for these leases and maintain compliance with certain
financial covenants. In the first nine months of 1995, the Company added
$14.1 million to the restricted investments, bringing the total to $32.6
million. Restricted cash is classified as a non-current asset on the balance
sheet.
The Company may continue its stock repurchase plan in the future. As of
October 2, 1995, 4,773,000 shares have been repurchased under the current plan
and there are a total of approximately 600,000 authorized shares remaining to
be purchased. The Company expects to utilize a portion of the repurchased
shares for issuance in connection with the Company's stock programs.
While the Company plans to fund working capital requirements through existing
capital resources and internally generated cash flow, the Company may, based
upon favorable market conditions, choose to raise additional capital through
the issuance of equity or debt securities of the Company. The Company may also
from time to time consider using available funds to acquire complementary
technologies and businesses.
12
<PAGE>13
PART II - OTHER INFORMATION
ITEM 1. The information required by this item is included in Part I in Note 4
of Notes to the Condensed Consolidated Financial Statements.
ITEM 6:
(a) Exhibit - 11.1 "Computation of Net Income Per Share and Dilutive
Common Share Equivalents"
(b) Reports on Form 8-K - None
13
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<TABLE>
CYPRESS SEMICONDUCTOR CORPORATION
EXHIBIT 11.1
COMPUTATION OF NET INCOME PER COMMON SHARE AND DILUTIVE
COMMON SHARE EQUIVALENTS
(In thousands, except per share data)
(Unaudited)
<CAPTION>
Three Months Ended Nine Months Ended
---------------------- ----------------------
Oct. 2, Oct. 3, Oct. 2, Oct. 3,
1995 1994 1995 1994
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
PRIMARY:
- - ----------------------------
Weighted average number of
common shares outstanding 83,520 76,342 81,201 74,972
Common share equivalents from
dilutive effect of
outstanding stock options 8,161 6,438 8,286 6,496
---------- ---------- ---------- ----------
Weighted average number of
common shares and dilutive
common share equivalents
outstanding 91,681 82,780 89,487 81,468
========== ========== ========== ==========
Net income used in per share
computation $ 32,219 $ 13,612 $ 66,926 $ 34,707
========== ========== ========== ==========
Net income per common and
common equivalent share $ 0.35 $ 0.16 $ 0.75 $ 0.43
========== ========== ========== ==========
FULLY DILUTED:
- - ----------------------------
Weighted average number of
common shares outstanding 83,520 76,342 81,201 74,972
Common share equivalents from
dilutive effect of
outstanding stock options 8,161 6,438 8,683 6,497
Shares issuable upon
conversion of convertible
subordinated notes 7,940 7,940 7,940 5,412
---------- ---------- ---------- ----------
Weighted average number of
common shares and dilutive
common share equivalents
outstanding 99,621 90,720 97,824 86,881
========== ========== ========== ==========
14
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CYPRESS SEMICONDUCTOR CORPORATION
EXHIBIT 11.1
COMPUTATION OF NET INCOME PER COMMON SHARE AND DILUTIVE
COMMON SHARE EQUIVALENTS (Continued)
(In thousands, except per share data)
(Unaudited)
<CAPTION>
Three Months Ended Nine Months Ended
---------------------- ----------------------
Oct. 2, Oct. 3, Oct. 2, Oct. 3,
1995 1994 1995 1994
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Net income used in per share
computation $ 33,122 $ 14,415 $ 69,624 $ 36,314
========== ========== ========== ==========
Net income per common and
common equivalent share $ 0.33 $ 0.16 $ 0.71 $ 0.42
========== ========== ========== ==========
</TABLE>
15
<PAGE>16
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CYPRESS SEMICONDUCTOR CORPORATION
Date: November 16, 1995 /s/ T.J. Rodgers
----------------------- ---------------------------------
T.J. Rodgers
President and Chief Executive
Officer
/s/ Emmanuel Hernandez
---------------------------------
Emmanuel Hernandez
Vice President, Finance and
Administration and Chief Financial
Officer
16
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE QUARTER AND NINE MONTH
PERIODS ENDED OCTOBER 2, 1995.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 9-MOS
<FISCAL-YEAR-END> JAN-01-1996 JAN-01-1996
<PERIOD-START> JUL-04-1995 JAN-03-1995
<PERIOD-END> OCT-02-1995 OCT-02-1995
<CASH> 3,706 3,706
<SECURITIES> 179,948 179,948
<RECEIVABLES> 100,944 100,944
<ALLOWANCES> 1,893 1,893
<INVENTORY> 29,521 29,521
<CURRENT-ASSETS> 345,370 345,370
<PP&E> 510,344 510,344
<DEPRECIATION> 205,960 205,960
<TOTAL-ASSETS> 706,015 706,015
<CURRENT-LIABILITIES> 143,621 143,621
<BONDS> 95,306 95,306
<COMMON> 886 886
0 0
0 0
<OTHER-SE> 448,794 448,794
<TOTAL-LIABILITY-AND-EQUITY> 706,015 706,015
<SALES> 161,155 418,793
<TOTAL-REVENUES> 161,155 418,793
<CGS> 73,860 195,594
<TOTAL-COSTS> 73,860 195,594
<OTHER-EXPENSES> 18,305 50,367
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 1,560 4,708
<INCOME-PRETAX> 50,737 105,393
<INCOME-TAX> 18,518 38,467
<INCOME-CONTINUING> 32,219 66,926
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 32,219 66,926
<EPS-PRIMARY> 0.35 0.75
<EPS-DILUTED> 0.33 0.71
</TABLE>
