Macom completes Auto Business sell-off
Macom has completed the previously announced sell-off of its automotive business to Autoliv ASP. This was for approximately $100 million in cash, plus the opportunity to receive up to an additional $30 million in cash based on the achievement of revenue-and customer order based earn-out targets through 2019.
In conjunction with closing the divestiture, Macom announced financial guidance for its fiscal fourth quarter ending October 2, 2015, excluding the Automotive business, which is now classified as discontinued operations. Macom expects revenue to be in the range of $110 to $114 million, or an increase of 1.0 percent to 4.5 percent, compared to the fiscal third quarter 2015 without Automotive. Non-GAAP gross margin is expected to be between 56 percent and 59 percent, and non-GAAP earnings per diluted share between $0.32 and $0.34 on an anticipated 55.5 million shares outstanding.
Commenting on the closing, John Croteau, president and CEO stated: "We are pleased to complete the divestiture of our Automotive business, which we believe represents a key step towards realizing our full potential as a pure play high-performance analog semiconductor company. Since announcing the transaction, we have become increasingly confident in the accelerated growth of our business, which we now expect to replace the pre-divestiture earnings contribution from the Auto business within a few quarters.
He added: "With our remaining business well aligned with our high-growth, high margin model, we expect to achieve our target of 60 percent non-GAAP gross margin in the first half of fiscal 2016 and 30 percent non-GAAP operating margin as we exit fiscal 2016. This exceptional financial profile will position Macom in the highest performing segment of our industry and serve as a key differentiator with both customers and investors alike."