UNITED STATES
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 March 29, 1998
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission file number 0-21970
--------------------------------------
ACTEL CORPORATION
(Exact name of Registrant as specified in its charter)
California 77-0097724
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
955 East Arques Avenue
Sunnyvale, California 94086-4533
(Address of principal executive offices) (Zip Code)
(408) 739-1010
(Registrant's telephone number, including area code)
--------------------------------------
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 the past 90 days. Yes X No
<PAGE>
Number of shares of Common Stock outstanding as of May 12, 1998:
21,265,894.
<PAGE>
PART I -- FINANCIAL INFORMATION
Item 1. Financial Statements.
ACTEL CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(unaudited, in thousands except per share amounts)
<TABLE>
<CAPTION>
Three Months Ended
----------------------------------------
Mar. 29, Mar. 30, Dec. 28,
1998 1997 1997
------------ ------------ ------------
<S> <C> <C> <C>
Net revenues............................................................ $ 38,465 $ 39,803 $ 37,012
Costs and expenses:
Cost of revenues..................................................... 15,785 16,439 15,287
Research and development............................................. 7,250 6,547 6,816
Selling, general, and administrative................................. 10,581 10,131 10,313
------------ ------------ ------------
Total costs and expenses....................................... 33,616 33,117 32,416
------------ ------------ ------------
Income from operations.................................................. 4,849 6,686 4,596
Interest income and other, net.......................................... 544 340 530
------------ ------------ ------------
Income before tax provision............................................. 5,393 7,026 5,126
Tax provision........................................................... 1,780 2,495 1,744
------------ ------------ ------------
Net income.............................................................. $ 3,613 $ 4,531 $ 3,382
============ ============ ============
Net income per share:
Basic................................................................ $ 0.17 $ 0.24 $ 0.16
============ ============ ============
Diluted.............................................................. $ 0.17 $ 0.21 $ 0.16
============ ============ ============
Shares used in computing net income per share:
Basic................................................................ 21,163 18,636 21,032
============ ============ ============
Diluted.............................................................. 21,864 22,082 21,623
============ ============ ============
</TABLE>
<PAGE>
ACTEL CORPORATION
CONSOLIDATED CONDENSED BALANCE SHEETS
(unaudited unless otherwise indicated, in thousands)
<TABLE>
<CAPTION>
Mar. 29, Dec. 28,
1998 1997
------------ ------------
(audited)
ASSETS
<S> <C> <C>
Current assets:
Cash and cash equivalents........................................................... $ 6,421 $ 7,763
Short-term investments.............................................................. 58,784 51,272
Accounts receivable, net............................................................ 21,186 25,135
Inventories, net.................................................................... 20,712 20,472
Other current assets................................................................ 24,039 22,621
------------ ------------
Total current assets.......................................................... 131,142 127,263
Property and equipment, net............................................................ 14,653 15,081
Investment in foundry.................................................................. 10,680 10,680
Other assets, net...................................................................... 6,837 6,970
------------ ------------
$ 163,312 $ 159,994
============ ============
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND SHAREHOLDERS' EQUITY
<S> <C> <C>
Current liabilities:
Accounts payable.................................................................... $ 9,927 $ 12,440
Accrued salaries and employee benefits.............................................. 3,125 4,718
Other accrued liabilities........................................................... 5,036 2,898
Deferred income..................................................................... 30,521 30,928
------------ ------------
Total current liabilities..................................................... 48,609 50,984
Shareholders' equity:
Preferred stock..................................................................... -- --
Common stock........................................................................ 21 21
Additional paid-in capital.......................................................... 88,066 85,965
Retained earnings................................................................... 26,616 23,024
------------ ------------
Total shareholders' equity.................................................... 114,703 109,010
------------ ------------
$ 163,312 $ 159,994
============ ============
</TABLE>
<PAGE>
ACTEL CORPORATION
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(unaudited, in thousands)
<TABLE>
<CAPTION>
Three Months Ended
------------ ------------
Mar. 29, Mar. 30,
1998 1997
------------ ------------
<S> <C> <C>
Operating activities:
Net income.......................................................................... $ 3,613 $ 4,531
Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation and amortization..................................................... 2,423 2,442
Changes in operating assets and liabilities:
Accounts receivable............................................................. 3,949 2,853
Inventories..................................................................... (240) 1,672
Other current assets............................................................ (1,418) (1,174)
Accounts payable, accrued salaries, employee benefits,
and other accrued liabilities................................................. (1,968) (4,934)
Deferred income................................................................. (407) (320)
------------ ------------
Net cash provided by operating activities......................................... 5,952 5,070
------------ ------------
Investing activities:
Purchases of property and equipment................................................. (1,776) (1,124)
Purchases of short-term investments................................................. (53,882) (30,859)
Sales of short-term investments .................................................... 46,388 31,131
Other assets........................................................................ (125) (660)
------------ ------------
Net cash used in investing activities............................................. (9,395) (1,512)
------------ ------------
Financing activities:
Sale of common stock................................................................ 2,101 1,582
------------ ------------
Net cash provided by financing activities......................................... 2,101 1,582
------------ ------------
Net increase in cash and cash equivalents........................................... (1,342) 5,140
Cash and cash equivalents, beginning of period...................................... 7,763 3,543
------------ ------------
Cash and cash equivalents, end of period............................................ $ 6,421 $ 8,683
============ ============
Supplemental disclosures of cash flows information and non-cash investing and
financing activities:
Cash paid for taxes................................................................. 45 3,059
Conversion of preferred stock....................................................... -- 18,147
</TABLE>
<PAGE>
ACTEL CORPORATION
Notes To Consolidated Condensed Interim Financial Statements
(unaudited unless otherwise indicated)
1. Basis of Presentation and Summary of Significant Accounting Policies
The accompanying unaudited consolidated condensed financial statements
of Actel Corporation (the "Company") have been prepared in accordance with
generally accepted accounting principles for interim financial information and
with the instructions to Form 10-Q and Article 10 of Regulation S-X.
Accordingly, these financial statements do not include all of the information
and footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included.
The consolidated financial statements include the accounts of the
Company and its wholly-owned subsidiaries. All significant intercompany accounts
and transactions have been eliminated in consolidation.
The interim financial statements should be read in conjunction with the
audited financial statements included in the Company's Annual Report on Form
10-K for the year ended December 28, 1997.
The results of operations for the three months ended March 29, 1998,
are not necessarily indicative of results that may be expected for the entire
year ending January 3, 1999.
2. Recent Accounting Pronouncements
As of January 1, 1998, the Company adopted Statement of Financial
Accounting Standards No. 130, "Reporting Comprehensive Income" ("SFAS 130").
SFAS 130 establishes new rules for the reporting and display of comprehensive
income and its components; however, the adoption of SFAS 130 had no impact on
the Company's net income or shareholders' equity. SFAS 130 requires unrealized
gains or losses on the Company's available-for-sale securities, which prior to
adoption were reported separately in shareholders' equity, to be included in
other comprehensive income. No amounts have been reported for other
comprehensive income due to the immateriality of the amounts.
3. Inventories
Inventories consist of the following:
<TABLE>
<CAPTION>
Mar. 29, Dec. 28,
1998 1997
------------ ------------
(audited)
<S> <C> <C>
Inventories:
Purchased parts and raw materials.................................................. $ 2,294 $ 3,681
Work-in-process.................................................................... 7,839 8,438
Finished goods..................................................................... 10,579 8,353
------------ ------------
$ 20,712 $ 20,472
============ ============
</TABLE>
Inventories are stated at the lower of cost (first-in, first-out) or
market (net realizable value). Given the volatility of the market for the
Company's products, the Company makes inventory provisions for potentially
excess and obsolete inventory based on backlog and forecast demand. However,
such backlog demand is subject to revisions, cancellations, and rescheduling.
Actual demand will inevitably differ from such backlog and forecast demand, and
such differences may be material to the financial statements. Excess inventory
increases handling costs and the risk of obsolescence, is a non-productive use
of capital resources, and delays realization of the price and performance
benefits associated with more advanced manufacturing processes.
4. Earnings Per Share
In February 1997, the Financial Accounting Standards Board issued
Statement No. 128, "Earnings per Share" ("SFAS 128"), which is applicable to all
financial statements issued for periods ending after December 15, 1997. Under
SFAS 128, the Company was required to change the method it has used to compute
earnings per share and to restate all prior periods. The new requirements
include a calculation of basic earnings per share, from which the dilutive
effect of stock options, warrants, and convertible debt are excluded; and a
calculation of diluted earnings per share, which does not differ from previously
reported net income (loss) per share. The Company adopted the provisions of SFAS
128 beginning with the financial statements for the year ended December 31,
1997, and all share and per share data for prior periods have been adjusted
retroactively to comply with the new requirement.
The following table sets forth the computation of basic and diluted
earnings per share:
<TABLE>
<CAPTION>
Three Months Ended
Mar. 29, Mar. 30,
1998 1997
------------ ------------
(in thousands, except per
share amounts)
<S> <C> <C>
Basic:
Average common shares outstanding...................................................... 21,163 18,636
Shares used in computing net income per share.......................................... 21,163 18,636
============ ============
Net income............................................................................. $ 3,613 $ 4,531
============ ============
Net income per share................................................................... $ 0.17 $ 0.24
============ ============
Diluted:
Average common shares outstanding...................................................... 21,163 18,636
Net effect of dilutive stock options and convertible preferred stock - based on the
treasury stock method............................................................... 701 3,446
------------ ------------
Shares used in computing net income per share.......................................... 21,864 22,082
============ ============
Net income............................................................................. $ 3,613 $ 4,531
============ ============
Net income per share................................................................... $ 0.17 $ 0.21
============ ============
</TABLE>
5. Conversion of Preferred Stock
On March 12, 1997, Texas Instruments Incorporated converted all of the
outstanding shares of Series A Preferred Stock into 2,631,578 shares of Common
Stock.
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
Results of Operations
Net Revenues
Net revenues for the first quarter of fiscal 1998 were $38.5 million,
which represents an increase of 4% compared with the fourth quarter of 1997 and
a decline of 3% compared with the first quarter of 1997. The Company derives its
revenues primarily from the sale of field programmable gate arrays ("FPGAs").
The sequential growth in quarterly net revenues resulted primarily from
an increase of 3% in unit sales of FPGAs coupled with an increase of 1% in the
overall selling price of FPGAs. Unit sales of the Company's new product families
(defined as ACT 3, XL, DX, RH, and MX) increased sequentially, while unit sales
of the Company's mature product families (defined as ACT 1 and ACT 2) was flat.
The overall average selling price of the Company's new product families
increased sequentially, while the overall average selling price of the mature
product families declined.
The year-to-year decline in quarterly net revenues resulted primarily
from a decline of 13% in the overall average selling price of FPGAs, which was
partially offset by an increase of 10% in FPGA unit sales. The overall average
selling price of the Company's new and mature product families both declined
year-to-year. Unit sales of the Company's new product families increased
year-to-year, while unit sales of the mature product families declined.
As is typical in the semiconductor industry, the average selling prices
of the Company's products generally decline over the lives of such products. To
increase revenues, the Company seeks to increase unit sales of existing
products, principally by reducing prices, and to introduce and sell new
products. There can be no assurance that these efforts will be successful.
Gross Margin
Gross margin for the first quarter of 1998 was 59.0% of net revenues,
compared with 58.7% for both the fourth and first quarter of 1997. A large
number of factors affect gross margins, many of which improved during the first
quarter of 1998 and might be said to account for the sequential and
year-over-year improvement in quarterly gross margin. The Company believes these
were normal improvements made in the ordinary course of business, which were
mostly offset by the normal manufacturing efficiencies and lower yields
associated with the ramping of new products. More specifically, the Company has
begun ramping production of its MX family of FPGAs, which had an adverse effect
on gross margin during the first quarter of 1998.
As is typical in the semiconductor industry, margins on the Company's
products often decline as the average selling prices of such products decline.
The Company seeks to offset margin erosion by reducing costs and by selling a
higher percentage of new products, which tend to have higher margins than more
mature products after satisfactory, sustainable yields are achieved. The Company
seeks to reduce costs by improving wafer yields, negotiating price reductions
with suppliers, increasing the level and efficiency of its testing and packaging
operations, achieving economies of scale by means of higher production levels,
and increasing the number of die produced per wafer by shrinking the die size of
its products. There can be no assurance that these efforts will be successful.
The ability of the Company to shrink the die size of its FPGAs is dependent on
the availability of more advanced manufacturing processes. Because of the custom
steps involved in manufacturing antifuse-based FPGAs, the Company typically
obtains access to new manufacturing processes later than its competitors using
standard manufacturing processes.
With its customized antifuse manufacturing process requirements, Actel
almost invariably experiences difficulties and delays in achieving satisfactory,
sustainable yields on new processes or at new foundries. The Company introduced
the first members of the MX family in the fourth quarter of 1997 and is
currently scheduled to introduce new members of the MX family and the first
members of the SX family in 1998. Until satisfactory yields are achieved on
these new product families, they generally will be sold at lower gross margins
than Actel's mature product families. Depending upon the rate at which sales of
these new products ramp (and the MX family is directed at high-volume users) and
the extent to which they displace mature products, the lower gross margins could
have a materially adverse effect on the Company's operating results.
Research and Development
Research and development expenditures for the first quarter of 1998
were $7.3 million, or 19% of net revenues, compared with $6.8 million, or 18% of
net revenues, for the fourth quarter of 1997 and $6.5 million, or 16% of net
revenues, for the first quarter of 1997. Research and development expenditures
for the first quarter of 1998 increased by 6% compared with the fourth quarter
of 1997 and by 11% compared with the first quarter of 1997, primarily due to a
heightened level of activity in support of new products. The Company currently
intends to boost its research and development expenditures in support of new
products. As a result, research and development expenditures may again increase
as a percentage of net revenues.
The Company's research and development consists of circuit design,
software development, and process technology activities. The Company believes
that continued substantial investment in research and development is critical to
maintaining a strong technological position in the industry and, therefore,
expects to continue increasing its research and development expenditures. Since
the Company's antifuse FPGAs are manufactured using a customized process, the
Company's research and development expenditures will probably always be higher
as a percentage of net revenues than that of its major competitors.
Selling, General, and Administrative
Selling, general, and administrative expenses for the first quarter of
1998 were $10.6 million, or 27.5% of net revenues, compared with $10.3 million,
or 27.9% of net revenues, for the fourth quarter of 1997 and $10.1 million, or
25% of net revenues, for the first quarter of 1997. Selling, general, and
administrative expenses for first quarter of 1998 increased by 3% compared with
the fourth quarter of 1997, but declined as a percentage of the Company's net
revenues. Selling, general, and administrative expenses for the first quarter of
1998 increased by 4% compared with the first quarter of 1997, and increased as a
percentage of the Company's net revenues. Selling, general, and administrative
expenses for the first quarter of 1998 increased principally because of an
increased level of sales and marketing activity in support of new products. The
Company currently intends to continue increasing its sales and marketing
expenditures in support of new products. In addition, the Company believes that
its legal expenses will increase as a percentage of net revenues, principally
because of an anticipated escalation in spending related to the Company's
continuing litigation with QuickLogic Corporation. As a result, selling,
general, and administrative expenditures may increase as a percentage of net
revenues.
Tax Provision
The Company's effective tax rate for the three months ended March 29,
1998, was 33%. This rate is based on the estimated annual tax rate complying
with Statement of Financial Accounting Standards No. 109, "Accounting for Income
Taxes." This rate differs from the federal statutory rate due primarily to state
income taxes (net of federal benefit), the benefits of research and development
credits and tax exempt income, and recognition of certain deferred tax assets
subject to valuation allowances and R&D credits as of December 29, 1997.
The Company's effective tax rate for the three months ended March 30,
1997, was 35.5%. This rate is higher than the effective tax for the three months
ended March 29, 1998, primarily because of the reinstatement of research and
development credits.
Liquidity and Capital Resources
At the end of the first quarter of 1998, the Company's cash, cash
equivalents, and short-term investments were $65.2 million, compared with $59.0
million at the beginning of fiscal 1998. The amount of cash, cash equivalents,
and short-term investments increased principally because of cash provided by
operations, including net income of $3.6 million and a reduction of $3.9 million
in net accounts receivable.
The Company believes that existing cash, cash equivalents, and
short-term investments, together with cash from operations, will be sufficient
to meet its cash requirements for fiscal 1998. A portion of available cash may
be used for investment in or acquisition of complementary businesses, products,
or technologies.
The Company has a line of credit with a bank that provides for
borrowings not to exceed $5,000,000. The agreement contains covenants that
require the Company to maintain certain financial ratios and levels of net
worth. As of May 12, 1998, the Company was in compliance with the covenants for
the line of credit. Borrowings against the line of credit bear interest at the
bank's prime rate. There were no borrowings against the line of credit at May
12, 1998. The line of credit, which expires in May 1999, may be terminated by
either party upon not less than thirty days' prior written notice.
The Company currently has no material financial obligations to its
current wafer suppliers. However, wafer manufacturers are increasingly demanding
financial support from customers in the form of equity investments and advance
purchase price deposits, which in some cases are substantial. Should the Company
require additional capacity, it may be required to incur significant
expenditures to secure such capacity.
The Company believes that the availability of adequate financial
resources is a substantial competitive factor. To take advantage of
opportunities as they arise, or to withstand adverse business conditions should
they occur, it may become prudent or necessary for the Company to raise
additional capital. The Company intends to continue monitoring the availability
and cost of potential capital resources, including equity, debt, and off-balance
sheet financing arrangements, and may consider raising additional capital on
terms that are acceptable to the Company. There can be no assurance that
additional capital will become available on acceptable terms.
Additional Quarterly Information
The following table presents certain unaudited quarterly results for
each of the eight quarters in the period ended March 29, 1998. In the opinion of
management, all necessary adjustments (consisting only of normal recurring
accruals) have been included in the amounts stated below to present fairly the
unaudited quarterly results when read in conjunction with the audited
consolidated financial statements of the Company and notes thereto included in
the Company's Annual Report on Form 10-K for the year ended December 28, 1997.
These quarterly operating results are not necessarily indicative of the results
for any future period.
<PAGE>
<TABLE>
<CAPTION>
Three Months Ended
-------------------------------------------------------------------------------------------
Mar. 29, Dec. 28, Sept. 28, June 29, Mar. 30, Dec. 29, Sept. 29 June 30,
1998 1997 1997 1997 1997 1996 1996 1996
---------- --------- ---------- ---------- --------- ---------- --------- ----------
(unaudited, in thousands except per share amounts)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Statements of Operations Data:
Net revenues.......................... $ 38,465 $ 37,012 $ 38,220 $ 40,823 $ 39,803 $ 39,027 $ 38,014 $ 36,694
Cost of revenue....................... 15,785 15,287 15,788 16,731 16,439 16,381 16,164 16,105
Gross profit.......................... 22,680 21,725 22,432 24,092 23,364 22,646 21,850 20,589
---------- --------- ---------- ---------- --------- ---------- --------- ----------
Research and development.............. 7,250 6,816 6,641 6,461 6,547 5,855 6,417 5,650
Selling, general, and administrative.. 10,581 10,313 10,355 10,394 10,131 10,651 9,854 9,582
---------- --------- ---------- ---------- --------- ---------- --------- ----------
Income from operations................ 4,849 4,596 5,436 7,237 6,686 6,140 5,579 5,357
Net income............................ $ 3,613 $ 3,382 $ 3,921 $ 4,934 $ 4,531 $ 4,153 $ 3,905 $ 3,606
Net income per share:
Basic............................... $ 0.17 $ 0.16 $ 0.19 $ 0.24 $ 0.24 $ 0.23 $ 0.22 $ 0.20
========== ========= ========== ========== ========= ========== ========= ==========
Diluted............................. $ 0.17 $ 0.16 $ 0.18 $ 0.23 $ 0.21 $ 0.19 $ 0.18 $ 0.17
========== ========= ========== ========== ========= ========== ========= ==========
Shares used in computing net income
per share:
Basic............................... 21,163 21,032 20,956 20,834 18,636 17,971 17,890 17,761
========== ========= ========== ========== ========= ========== ========= ==========
Diluted............................. 21,864 21,623 22,172 21,890 22,082 21,893 21,475 21,467
========== ========= ========== ========== ========= ========== ========= ==========
Three Months Ended
-------------------------------------------------------------------------------------------
Mar. 29, Dec. 28, Sept. 28, June 29, Mar. 30, Dec. 29, Sept. 29 June 30,
1998 1997 1997 1997 1997 1996 1996 1996
---------- --------- ---------- ---------- --------- ---------- --------- ----------
As a Percentage of Net Revenues:
Net revenues.......................... 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Cost of revenues...................... 41.0 41.3 41.3 41.0 41.3 42.0 42.5 43.9
---------- --------- ---------- ---------- --------- ---------- --------- ----------
Gross margin.......................... 59.0 58.7 58.7 59.0 58.7 58.0 57.5 56.1
Research and development.............. 18.9 18.4 17.4 15.8 16.4 15.0 16.9 15.4
Selling, general, and administrative.. 27.5 27.9 27.1 25.5 25.5 27.3 25.9 26.1
---------- --------- ---------- ---------- --------- ---------- --------- ----------
Income from operations................ 12.6 12.4 14.2 17.7 16.8 15.7 14.7 14.6
Net income............................ 9.4 9.1 10.3 12.1 11.4 10.6 10.3 9.8
</TABLE>
<PAGE>
Year 2000 Compliance and Other Factors Affecting Future Operating Results
Like most other companies, the year 2000 computer issue creates risk
for the Company. If internal systems do not correctly recognize date information
when the year changes to 2000, there could be an adverse impact on the Company's
operations. The Company has initiated a comprehensive project to prepare its
computer systems for the year 2000 and plans to have changes to critical systems
completed by the first quarter of 1999 to allow time for testing. The Company is
also assessing the capability of its products sold to customers over a period of
years to handle the year 2000, but does not currently believe there are product
issues. Management believes that the likelihood of a material adverse impact due
to problems with internal systems or products sold to customers is remote and
expects that the cost of these projects over the next two years will not have a
material effect on the Company's financial position or overall trends in results
of operations. The Company is also developing a plan to contact critical
suppliers of products and services to determine that the suppliers' operations
and the products and services they provide are year 2000 capable or to monitor
their progress toward year 2000 capability. There can be no assurance that
another company's failure to ensure year 2000 capability will not have an
adverse effect on the Company.
The Company's operating results are subject to general economic
conditions and a variety of risks characteristic of the semiconductor industry
(including booking and shipment uncertainties, wafer supply fluctuations, and
price erosion) or specific to the Company, any of which could cause the
Company's operating results to differ materially from past results. For a
discussion of such risks, see "Risk Factors" in Part I of the Company's Annual
Report on Form 10-K for 1997, which is incorporated herein by this reference.
PART II -- OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
The following exhibits are filed as part of, or incorporated by
reference into, this Quarterly Report on Form 10-Q:
None
(b) Reports on Form 8-K
None
SIGNATURE
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.
ACTEL CORPORATION
Date: May 13, 1998 /s/ Henry L. Perret
--------------------------------------------------------
Henry L. Perret
Vice President of Finance
and Chief Financial Officer
(as principal financial officer
and on behalf of Registrant)
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JAN-03-1999
<PERIOD-START> DEC-29-1997
<PERIOD-END> MAR-29-1998
<CASH> 6,641
<SECURITIES> 58,784
<RECEIVABLES> 23,493
<ALLOWANCES> 2,307
<INVENTORY> 20,712
<CURRENT-ASSETS> 131,142
<PP&E> 42,088
<DEPRECIATION> 27,435
<TOTAL-ASSETS> 163,312
<CURRENT-LIABILITIES> 48,609
<BONDS> 0
<COMMON> 88,083
0
0
<OTHER-SE> 26,616
<TOTAL-LIABILITY-AND-EQUITY> 163,312
<SALES> 38,465
<TOTAL-REVENUES> 38,465
<CGS> 15,785
<TOTAL-COSTS> 33,616
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 544
<INCOME-PRETAX> 5,393
<INCOME-TAX> 1,780
<INCOME-CONTINUING> 3,613
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3,613
<EPS-PRIMARY> .17
<EPS-DILUTED> .17
</TABLE>
