<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
of
THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter ended September 28, 1996
Commission File Number 0-22660
TRIQUINT SEMICONDUCTOR, INC.
(Registrant)
Incorporated in the State of California
I.R.S. Employer Identification Number 95-3654013
3625A SW Murray Blvd., Beaverton, OR 97005
Telephone: (503) 644-3535
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
--- ---
On September 27, 1996, 8,113,629 shares of the registrant's common stock were
issued and outstanding.
<PAGE>
TRIQUINT SEMICONDUCTOR, INC.
INDEX
<TABLE>
<S> <C> <C>
PART I. FINANCIAL INFORMATION PAGE NO.
- -----------------------------------------------------------------------------------------------------
Item 1. Financial Statements
Condensed Statements of Operations -- Three and nine months
ended September 30, 1996 and 1995 3
Condensed Balance Sheets -- September 30, 1996
and December 31, 1995 4
Condensed Statements of Cash Flows -- Nine months
ended September 30, 1996 and 1995 5
Notes to condensed financial statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
PART II. OTHER INFORMATION
- -----------------------------------------------------------------------------------------------------
Item 1. Legal Proceedings 14
Item 6. Exhibits and Reports on Form 8-K 14
SIGNATURES 15
</TABLE>
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1: FINANCIAL STATEMENTS
TRIQUINT SEMICONDUCTOR, INC.
CONDENSED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
<TABLE>
THREE MONTHS ENDED NINE MONTHS ENDED
----------------------------- -----------------------------
SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30,
1996 1995 1996 1995
------------- ------------- ------------ -------------
<S> <C> <C> <C> <C>
Total revenues $ 15,104 $ 12,745 $ 43,315 $ 33,322
Operating costs and expenses:
Cost of goods sold 8,829 6,516 25,120 17,106
Research, development and engineering 2,868 2,299 8,017 6,848
Selling, general and administrative 2,722 2,579 7,927 6,858
------------- ------------- ------------ -------------
Total operating costs and expenses 14,419 11,394 41,064 30,812
------------- ------------- ------------ -------------
Income from operations 685 1,351 2,251 2,510
------------- ------------- ------------ -------------
Other income (expense):
Interest income 838 255 2,665 646
Interest expense (277) (131) (723) (364)
Other, net 664 (22) 658 (68)
------------- ------------- ------------ -------------
Total other income, net 1,225 102 2,600 214
------------- ------------- ------------ -------------
Income before income taxes 1,910 1,453 4,851 2,724
Income tax expense 58 44 225 83
------------- ------------- ------------ -------------
Net income $ 1,852 $ 1,409 $ 4,626 $ 2,641
============= ============= ============ =============
Net income per common and common
equivalent share $ 0.21 $ 0.20 $ 0.53 $ 0.39
============ ============= ============ =============
Weighted average common and common
equivalent shares outstanding 8,798 7,134 8,732 6,758
============ ============= ============ =============
</TABLE>
See notes to Condensed Financial Statements.
3
<PAGE>
TRIQUINT SEMICONDUCTOR, INC.
CONDENSED BALANCE SHEETS
(In thousands)
(Unaudited)
<TABLE>
SEPTEMBER 30, DECEMBER 31,
1996 1995(1)
------------- ------------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 4,682 $ 35,051
Investments 39,825 27,921
Accounts receivable, net 10,555 7,388
Inventories, net 10,033 8,709
Prepaid expenses and other assets 676 432
------------- ------------
Total current assets 65,771 79,501
------------- ------------
Property, plant and equipment, net 17,629 14,460
Restricted investments 19,846 -
Other non-current assets 89 63
------------- ------------
Total assets $ 103,335 $ 94,024
------------- ------------
------------- ------------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current installments of capital lease obligations $ 3,123 $ 2,329
Accounts payable and accrued expenses 12,282 11,443
Other current liabilities 141 216
------------- ------------
Total current liabilities 15,546 13,988
Capital lease obligations, less current installments 9,632 7,392
------------- ------------
Total liabilities 25,178 21,380
------------- ------------
Shareholders' equity:
Common stock 108,699 107,813
Accumulated deficit (30,542) (35,169)
------------- ------------
Total shareholders' equity 78,157 72,644
------------- ------------
Total liabilities and shareholders' equity $ 103,335 $ 94,024
============= ============
</TABLE>
(1) The information in this column was derived from the Company's audited
financial statements as of December 31, 1995.
See notes to Condensed Financial Statements.
4
<PAGE>
TRIQUINT SEMICONDUCTOR, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
<TABLE>
Nine Months Ended
-----------------------------
September 30, September 30,
1996 1995
------------- -------------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 4,626 $ 2,641
Adjustments to reconcile net income to
net cash provided (used) by operating activities:
Depreciation and amortization 2,025 2,196
Gain on sale of assets (728) (19)
Change in assets and liabilities
Decrease (Increase) in:
Accounts receivable (3,167) (3,156)
Inventories (1,324) (3,274)
Prepaid expense and other assets (270) 205
Increase (decrease) in:
Accounts payable and accrued expenses 839 1,678
Other current liabilities (75) 363
------------- -------------
NET CASH PROVIDED BY OPERATING ACTIVITIES 1,926 634
Cash flows from investing activities:
Purchase of investments (49,870) (11,739)
Purchase of restricted investments (19,846) -
Sale/Maturity of investments 37,966 4,508
Capital expenditures (22) (417)
Proceeds from sale of assets 728 19
------------- -------------
NET CASH USED BY INVESTING ACTIVITIES (31,044) (7,629)
Cash flows from financing activities:
Principal payments under capital lease obligations (2,137) (1,258)
Issuance of common stock, net 886 48,800
------------- -------------
NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES (1,251) 47,542
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (30,369) 40,547
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD 35,051 9,443
------------- -------------
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD $ 4,682 $ 49,990
============= =============
</TABLE>
See notes to Condensed Financial Statements.
5
<PAGE>
TRIQUINT SEMICONDUCTOR, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(In thousands except share amounts)
(Unaudited)
1. BASIS OF PRESENTATION
The accompanying financial statements have been prepared in conformity with
generally accepted accounting principles. However, certain information or
footnote disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been
condensed, or omitted, pursuant to the rules and regulations of the
Securities and Exchange Commission. In the opinion of management, the
statements include all adjustments necessary (which are of a normal and
recurring nature) for the fair presentation of the results of the interim
periods presented. These financial statements should be read in
conjunction with the TriQuint Semiconductor, Inc. ("Company") audited
consolidated financial statements for the year ended December 31, 1995, as
included in the Company's 1995 Annual Report to Shareholders.
The Company's fiscal year ends on the Saturday nearest December 31. For
convenience, the Company has indicated in this quarterly report on Form
10-Q that its fiscal year ended on December 31. In addition, the Company's
quarters end on the Saturday nearest the end of the calendar quarter. For
convenience, the Company has indicated that its third quarter ended on
September 30.
2. NET INCOME PER COMMON AND COMMON EQUIVALENT SHARE
Net income per common and common equivalent share is computed using the
weighted average number of common and dilutive common equivalent shares
assumed to be outstanding during the period. Common equivalent shares
consist of options and warrants to purchase common stock.
3. RESEARCH AND DEVELOPMENT COSTS
The Company charges all research and development costs associated with the
development of new products to expense when incurred. Engineering and
design costs related to revenues on non-recurring engineering services
billed to customers are classified as research, development and engineering
expense. Additionally, certain related contract engineering costs are also
included in research, development and engineering expense.
4. INCOME TAXES
The provision for income taxes has been recorded based on the current
estimate of the Company's annual effective tax rate. For periods of
income, this rate differs from the federal statutory rate primarily because
of the utilization of net operating loss carryforwards.
<PAGE>
5. INVENTORIES
Inventories, net of reserves, stated at the lower of cost or market consist
of:
September 30, December 31,
1996 1995
------------- ------------
Raw material $ 3,164 $ 2,198
Work in progress 5,856 5,908
Finished goods 1,013 603
------------- ------------
Total inventories $ 10,033 $ 8,709
============= ============
6. SHAREHOLDERS' EQUITY
Shares authorized and outstanding are as follows:
SHARES OUTSTANDING
September 30, December 31,
1996 1995
------------- ------------
Preferred stock, no par value,
5,000,000 shares authorized - -
Common stock, no par value,
25,000,000 shares authorized 8,113,629 7,929,881
7. SUPPLEMENTAL CASH FLOW INFORMATION
NINE MONTHS ENDED
September 30, September 30,
1996 1995
------------- -------------
Cash Transactions:
Cash paid for interest $ 722 $ 364
Cash paid for income taxes 17 9
Non-Cash Transactions:
Purchase of assets through capital leases $ 5,171 -
9. LITIGATION
See Part II, Item 1, of this Quarterly Report on Form 10-Q for a
description of legal proceedings.
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following Management's Discussion and Analysis of Financial Condition
and Results of Operations contains forward looking statements that involve risks
and uncertainties. The Company's actual results could differ materially from
those anticipated in these forward looking statements as a result of certain
factors discussed herein.
INTRODUCTION
TriQuint Semiconductor, Inc. ("TriQuint" or the "Company") designs,
develops, manufactures and markets a broad range of high performance analog and
mixed signal integrated circuits for the wireless communications,
telecommunications and computing markets. The Company utilizes its proprietary
gallium arsenide ("GaAs") technology to enable its products to overcome the
performance barriers of silicon devices in a variety of applications. The
Company sells its products on a worldwide basis and the Company's end user
customers include Alcatel, Cirrus Logic, Digital Equipment, DSC Communications,
Ericsson, Hughes, IBM, Lucent Technologies, Motorola, Northern Telecom, Philips,
Rockwell, Siemens, Storage Technology and Stratacom.
RESULTS OF OPERATIONS
The following table sets forth the statement of operations data of the
Company expressed as a percentage of total revenues for the periods indicated.
<TABLE>
Three Months Ended Nine Months Ended
------------------------------ -----------------------------
September 30, September 30, September 30, September 30,
1996 1995 1996 1995
------------- ------------- ------------ -------------
<S> <C> <C> <C> <C>
Total revenues 100.0% 100.0% 100.0% 100.0%
Operating costs and expenses:
Cost of goods sold 58.5 51.1 58.0 51.3
Research, development and engineering 19.0 18.1 18.5 20.6
Selling, general and administrative 18.0 20.2 18.3 20.6
------------- ------------- ------------ ------------
Total operating costs and expenses 95.5 89.4 94.8 92.5
------------- ------------- ------------ ------------
Income from operations 4.5 10.6 5.2 7.5
Other income, net 8.1 0.8 6.0 0.6
------------- ------------- ------------ ------------
Income before income taxes 12.6 11.4 11.2 8.1
Income tax expense 0.4 0.3 0.5 0.2
------------- ------------- ------------ ------------
Net income 12.2% 11.1% 10.7% 7.9%
============= ============= ============ ============
</TABLE>
TOTAL REVENUES
The Company derives revenues from the sale of standard and customer-
specific products and services. The Company's revenues also include non-
recurring engineering (NRE) revenues relating to customer-specific products.
Although revenues from standard products are separately identifiable by
<PAGE>
reference to the Company's standard product catalog, it is not practical to
differentiate between customer-specific product revenue and NRE revenue because
(i) the Company's contracts generally state a total contract price without
differentiating between engineering and production activity, (ii) it is
difficult to determine when engineering activity has transitioned to production
activity and (iii) it is difficult to determine whether certain manufacturing
services should be classified as engineering activity or customer-specific
products.
Total revenues for the three and nine months ended September 30, 1996
increased 18.5% and 30.0% to $15.1 million and $43.3 million, respectively, over
the comparable three and nine month periods ended September 30, 1995. The
increase in revenues during the three and nine months ended September 30, 1996
reflected an overall increase in the volume of product sales to existing and new
customers, primarily from product sales in the wireless communications,
telecommunications and computing markets.
COST OF GOODS SOLD
Cost of goods sold includes all direct material, labor and overhead
expenses and certain production costs related to NRE revenues. In general, the
Company believes that gross profit generated from the sale of customer-specific
products and from NRE revenues is typically higher than gross profit generated
from the sale of standard products. The factors affecting product mix include
the relative demand in the markets served by customer-specific and standard
products, as well as the number of NRE projects which result in volume
requirements for customer-specific products.
Cost of goods sold as a percentage of the total revenues for the three
months ended September 30, 1996 increased to 58.5% from 51.1% for the comparable
three month period ended September 30, 1995. For the nine months ended September
30, 1996 the cost of goods sold as a percentage of the total revenues increased
to 58.0% from 51.3% for the comparable nine month period ended September 30,
1995. The increase in cost of goods sold as a percentage of total revenues,
from the three and nine months comparable periods ended September 30, 1995, was
primarily attributable to lower than expected production yields and an increase
in certain manufacturing costs related to employee hiring and training and
consulting services.
The Company has in the past experienced lower than expected production
yields which have delayed shipments of a given product and adversely affected
gross margins. For example, in the fourth quarter of 1995, the Company
announced that reduced production yields had materially affected its operating
results. Although the Company has made some improvement in yields since that
time, further improvement is needed to achieve previous performance levels.
There can be no assurance that the Company will be able to maintain acceptable
production yields in the future and, to the extent that it does not achieve
acceptable production yields, its operating results would be materially
adversely affected. In addition, the Company's operation of its own wafer
fabrication facility entails a high degree of fixed costs and requires an
adequate volume of production and sales to be profitable. During periods of
decreased demand, high fixed wafer fabrication costs would have a material
adverse effect on the Company's operating results.
RESEARCH, DEVELOPMENT AND ENGINEERING
Research, development and engineering expenses include the costs incurred
in the design of products associated with NRE revenues, as well as ongoing
product development and research and development expenses. The Company's
research, development and engineering expenses for the three
<PAGE>
and nine months ended September 30, 1996 increased 24.7% and 17.1% to
$2.9 million and $8.0 million, respectively, from the comparable three and
nine month periods ended September 30, 1995. Research, development and
engineering expenses as a percentage of total revenues for the three months
ended September 30, 1995 increased to 19.0% from 18.0% for the comparable three
month period ended September 30, 1995; for the nine months ended September 30,
1995, research, development and engineering expenses as a percentage of total
revenues decreased to 18.5% from 20.6% for the comparable nine month period
ended September 30, 1995. The increase in research, development and engineering
expenses in absolute dollar level was primarily due to increased product
development activities and NRE expenses. The decrease in research, development
and engineering expenses as a percentage of total revenues resulted from revenue
growth that outpaced the growth of research, development and engineering
expenses. The Company is committed to substantial investments in research,
development, and engineering and expects such expenses shall increase in
absolute dollar amount in the future.
SELLING, GENERAL AND ADMINISTRATIVE
Selling, general and administrative expenses for the three and nine months
ended September 30, 1996 increased 5.5% and 15.6% to approximately $2.7 million
and $7.9 million, respectively, from the comparable three and nine month periods
ended September 30, 1995. Selling, general and administrative expenses as a
percentage of revenue for the three months ended September 30, 1996 decreased to
18.0% from 20.2% for the comparable three month period ended September 30,
1995; for the nine months ended September 30, 1996, selling, general and
administrative expenses as a percentage of revenue decreased to 18.3% from 20.6%
for the comparable nine month period ended September 30, 1995. The increase in
absolute dollar level of selling, general and administrative expenses was
primarily due to increased sales commissions in connection with the increase in
total revenues and increased personnel expenses. The decrease in selling,
general and administrative expenses as a percentage of total revenues resulted
from revenue growth that outpaced the growth of selling, general and
administrative expenses.
OTHER INCOME, NET
Other income, net for the three and nine months ended September 30, 1996
increased to an approximate net other income of $1.2 million and $2.6 million,
respectively, as compared to net other income of $102,000 and $214,000 for the
comparable three and nine month periods ended September 30, 1995. This
improvement resulted from interest income earned on higher cash, cash
equivalents and investment balances due primarily to the net proceeds of the
follow-on stock offering in September, 1995 and from a $680,000 gain from the
sale of the Company's minority interest in its primary distributor in Europe.
INCOME TAX EXPENSE
The effective tax rate for the nine months ended September 30, 1996 was
5.0%, which is less than the federal and state statutory rate of approximately
40% due to the use of net operating loss carryforwards. Income tax expense for
the three and nine months ended September 30, 1996 increased to approximately
$58,000 and $225,000, respectively, compared to $44,000 and $83,000 for the
comparable three and nine month periods ended September 30, 1995. This increase
in income tax expenses was attributable to higher profits partially offset by
the use of net operating losses.
<PAGE>
VARIABILITY OF OPERATING RESULTS AND CYCLICALITY OF SEMICONDUCTOR INDUSTRY
The Company's quarterly and annual results may vary significantly in the
future due to a number of factors including timing, cancellation or delay of
customer orders; market acceptance of the Company's and its customers' products;
variations in manufacturing yields; timing of announcement and introduction of
new products by the Company and its competitors; changes in revenues and product
mix; competitive factors; changes in manufacturing capacity and variations in
the utilization of this capacity; variations in average selling prices;
variations in operating expenses; the long sales cycles associated with the
Company's customer-specific products; the timing and level of product and
process development costs; cyclicality of the semiconductor industry; the
timing and level of NRE revenues and expenses relating to customer-specific
products; and changes in inventory levels. Any unfavorable changes in these or
other factors could have a material adverse effect on the Company's operating
results.
A significant portion of the Company's revenues in each fiscal period has
historically been concentrated among a limited number of customers. In recent
periods, sales to the Company's major customers as a percentage of total
revenues have fluctuated. For the three months ended September 30, 1996, Cirrus
Logic and Northern Telecom accounted for 19% and 8% respectively, of total
revenues. The Company anticipates that its sales to Cirrus Logic will decrease
in the fourth quarter of 1996 and in 1997 to less than 10% of total revenues.
The Company's revenues, to a certain extent, depend upon its customers
successfully introducing and marketing new products. Certain of these products
are consumer products and there is no guarantee purchases by consumers will meet
TriQuint customers' expectations. The Company does not have long-term purchase
agreements with any of its customers. Customers generally purchase the
Company's products pursuant to cancelable short-term purchase orders. The
Company's business, financial condition, and results of operations have been
materially adversely affected in the past by the failure of anticipated orders
to materialize and by deferrals or cancellations of orders.
The semiconductor industry has historically been characterized by wide
fluctuations in product supply and demand. From time to time, the industry has
also experienced significant downturns, often in connection with, or in
anticipation of, declines in general economic conditions. These downturns have
been characterized by diminished product demand, production overcapacity and
subsequent accelerated erosion of average selling prices, and, in some cases,
have lasted for extended periods of time. The Company's business has in the past
been and could in the future be materially adversely affected by such industry-
wide fluctuations.
LIQUIDITY AND CAPITAL RESOURCES
The Company completed a follow on public offering in September 1995 raising
approximately $48.1 million, net of offering expenses. In December 1993 and
January 1994, the Company completed its initial public offering raising
approximately $16.7 million, net of offering expenses. In addition, the Company
has funded its operations to date through other sales of equity, bank borrowing,
capital equipment leases and cash flow from operations. As of September 30,
1996, the Company had working capital of approximately $50.2 million, including
$44.5 million in cash, cash equivalents, and unrestricted investments. The
Company has a $10.0 million unsecured revolving line of credit with a financial
institution. Restrictive covenants included in the line of credit require the
Company to maintain (i) a total liability to tangible net worth ratio of not
more than 0.75 to 1.00, (ii) a current ratio of not less than 1.75 to 1.00,
(iii) minimum tangible net worth greater than $50.0 million and (iv) cash and
investments, including restricted investments, greater than $45.0 million. As of
September 30, 1996 the Company was in compliance with the covenants contained
in this line of credit.
<PAGE>
The Company's current wafer fabrication facility lease expires in January
1998. In May 1996, the Company obtained financing in the form of a five year
operating lease to arrange for the construction of a new wafer fabrication and
office complex at Dawson Creek ("the Dawson Creek Facility"), in Hillsboro,
Oregon. The Company entered into several agreements each dated May 17, 1996 in
connection with the operating lease. Pursuant to that certain Participation
Agreement among the Company, Wolverine Leasing Corp. ("Wolverine"), Matisse
Holding Company ("Matisse") and United States National Bank ("Bank"), Wolverine
shall lease certain real property owned by Wolverine to the Company under an
operating lease with an option by the Company to purchase such property. In
addition, the Participation Agreement provides that Wolverine will make advances
to the Company to cover the costs of certain improvements to such real property
and to pay certain related financing costs, transaction costs, and other costs
and expenses; Wolverine will use the proceeds of loans from the Bank and
Matisse, as well as certain equity funds provided by Matisse, in order to
provide the Company with such advances and such other costs and expenses. The
Bank loans are collateralized by pledged investments from the Company,
classified as restricted investments on the Company's balance sheet ($19.8
million as of September 30, 1996). Restrictive covenants included in the
Participation Agreement between the Company and the Bank require the Company to
maintain (i) a total liability to tangible net worth ratio of not more than 0.75
to 1.00, (ii) minimum tangible net worth greater than $50.0 million and (iii)
cash and liquid investments, including restricted investments, greater than
$45.0 million. As of September 30, 1996 the Company was in compliance with the
covenants contained in the Participation Agreement.
<TABLE>
The following table presents a summary of the Company's cash flows (IN THOUSANDS):
Nine Months Ended September 30,
-------------------------------
1996 1995
----------- -----------
<S> <C> <C>
Net cash and cash equivalents provided
by operating activities $ 1,926 $ 634
Net cash and cash equivalents
used by investing activities (31,044) (7,629)
Net cash and cash equivalents provided
(used) by financing activities (1,251) 47,542
----------- -----------
Net increase (decrease) in cash and cash equivalents $ (30,369) $ 40,547
=========== ===========
</TABLE>
The cash provided by operating activities for the nine month period ended
September 30, 1996, $1.9 million, related to cash generated from profitable
operations partially offset by increased accounts receivable, inventories and
prepaid expenses.
The cash used by investing activities for the nine month period ended
September 30, 1996, $31.0 million, related to the purchase of restricted
investments pledged to collateralize the operating lease on the Dawson Creek
Facility and the net purchase of non-restricted investments. These were
partially offset by the sale of the Company's interest in its primary European
distributor.
The cash used by financing activities for the nine month period ended
September 30, 1996, $1.3 million, related primarily to the payment of principal
under capital leases partially offset by the issuance of common stock under
employee stock purchase programs.
For the nine months ended September 30, 1996, the Company established
approximately $5.2 million in new capital leases. Since 1991, the Company has
financed approximately $19.1 million of machinery and equipment through capital
lease obligations. The Company expects to make continued investments in its
capital equipment, including manufacturing and test equipment and computer
hardware
<PAGE>
and software, in order to enhance its technology and competitive position.
In addition, the Company's move to the new Dawson Creek Facility will require
expenditures for capital equipment above normal operating levels. The Company
expects to make additional capital expenditures of approximately $12.0 million
over the next twelve months.
The Company believes that its current cash and investment balances,
together with cash anticipated to be generated from operations, additional
equipment leases and the operating lease with Wolverine, will satisfy the
Company's projected working capital and capital expenditure requirements through
the end of 1997. However, the Company may be required to finance any additional
requirements through additional equity, debt financings, or credit facilities.
There can be no assurance that such additional financings or credit facilities
will be available, or if available, that they will be on satisfactory terms.
<PAGE>
PART II - OTHER INFORMATION
ITEM 1: LEGAL PROCEEDINGS.
On June 9, 1994 the Company issued a press release indicating softness in
the Company's revenues which would adversely affect the Company's financial
results. The cause for the reduction in revenues was due somewhat to a general
softness in orders in the telecommunications market; however, it was primarily
the result of a decision by the Company's largest customer to delay shipment of
certain products. As a result of this announcement, the Company's stock price
dropped 48% on June 10, 1994. On July 12, 1994, a shareholder class action
lawsuit was filed against the Company in the United States District Court for
the Northern District of California. On June 21, 1996, the court granted the
Company's motion to transfer the litigation to the District of Oregon. The suit
alleges that the Company, its underwriters, and certain of its officers,
directors and investors, intentionally misled the investing public regarding the
financial prospects of the Company. Since the Company and its management have
striven to keep investors current on the Company's progress at all times, the
Company strongly denies any claims of wrongdoing and will defend this lawsuit
vigorously.
ITEM 6: EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits:
Exhibit 27.1 Financial Data Schedule
(b) Reports on Form 8-K.
No reports on Form 8-K were filed by the Company for the Quarter
ended September 30, 1996.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
TriQuint Semiconductor, Inc.
Dated: November 5, 1996 /s/ Steven J. Sharp
---------------------------
STEVEN J. SHARP
President, Chief Executive Officer and
Chairman (Principal Executive Officer)
Dated: November 5, 1996 /s/ Edward C.V. Winn
---------------------------
EDWARD C.V. WINN
Executive Vice President, Finance and
Administration and Chief Financial
Officer
(Principal Financial and Accounting Officer)
<PAGE>
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION
- ------------------------------------------------
27.1 Financial Data Schedule
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONDENSED BALANCE SHEET AS OF SEPTEMBER 30, 1996 AND THE CONDENSED STATEMENT OF
OPERATIONS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1996 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JUL-01-1996
<PERIOD-END> SEP-30-1996
<CASH> 4,682
<SECURITIES> 39,825
<RECEIVABLES> 10,760
<ALLOWANCES> (205)
<INVENTORY> 10,033
<CURRENT-ASSETS> 65,771
<PP&E> 49,464
<DEPRECIATION> (31,835)
<TOTAL-ASSETS> 103,335
<CURRENT-LIABILITIES> 15,546
<BONDS> 9,632
0
0
<COMMON> 108,699
<OTHER-SE> (30,542)
<TOTAL-LIABILITY-AND-EQUITY> 103,335
<SALES> 43,315
<TOTAL-REVENUES> 43,315
<CGS> 25,120
<TOTAL-COSTS> 41,064
<OTHER-EXPENSES> (658)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 723
<INCOME-PRETAX> 4,851
<INCOME-TAX> 225
<INCOME-CONTINUING> 4,626
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,626
<EPS-PRIMARY> 0.53
<EPS-DILUTED> 0.53
</TABLE>
