0001104659-22-111394 | 10-Q | XBRL Viewer

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Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Oct. 01, 2022	Oct. 17, 2022
Document and Entity Information
Entity Registrant Name	SILICON LABORATORIES INC.
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Oct. 01, 2022
Document Transition Report	false
Entity File Number	000-29823
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	74-2793174
Entity Address, Address Line One	400 West Cesar Chavez
Entity Address, City or Town	Austin
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	78701
City Area Code	512
Local Phone Number	416-8500
Title of 12(b) Security	Common Stock, $0.0001 par value
Trading Symbol	SLAB
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		33,282,898
Entity Central Index Key	0001038074
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q3
Amendment Flag	false

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Oct. 01, 2022	Jan. 01, 2022
Current assets:
Cash and cash equivalents	$ 483,277	$ 1,074,623
Short-term investments	893,131	964,582
Accounts receivable, net	76,672	98,313
Inventories	88,447	49,307
Prepaid expenses and other current assets	84,109	51,748
Total current assets	1,625,636	2,238,573
Property and equipment, net	151,610	146,516
Goodwill	376,389	376,389
Other intangible assets, net	91,650	118,978
Other assets, net	91,012	77,839
Total assets	2,336,297	2,958,295
Current liabilities:
Accounts payable	81,676	47,327
Current portion of convertible debt, net		450,599
Deferred revenue and returns liability	11,705	13,849
Other current liabilities	112,320	157,052
Total current liabilities	205,701	668,827
Convertible debt, net	529,062
Other non-current liabilities	49,890	77,044
Total liabilities	784,653	745,871
Commitments and contingencies
Stockholders' equity:
Preferred stock - $0.0001 par value; 10,000 shares authorized; no shares issued
Common stock - $0.0001 par value; 250,000 shares authorized; 33,530 and 38,481 shares issued and outstanding at October 1, 2022 and January 1, 2022, respectively	3	4
Retained earnings	1,568,108	2,214,839
Accumulated other comprehensive loss	(16,467)	(2,419)
Total stockholders' equity	1,551,644	2,212,424
Total liabilities and stockholders' equity	$ 2,336,297	$ 2,958,295

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares shares in Thousands	Oct. 01, 2022	Jan. 01, 2022
Condensed Consolidated Balance Sheets
Preferred stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	10,000	10,000
Preferred stock, shares issued	0	0
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized	250,000	250,000
Common stock, shares issued	33,530	38,481
Common stock, shares outstanding	33,530	38,481

Condensed Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 01, 2022	Oct. 02, 2021	Oct. 01, 2022	Oct. 02, 2021
Condensed Consolidated Statements of Income
Revenues	$ 269,817	$ 184,831	$ 766,781	$ 512,180
Cost of revenues	104,232	75,322	281,521	214,619
Gross profit	165,585	109,509	485,260	297,561
Operating expenses:
Research and development	84,624	72,656	245,677	201,503
Selling, general and administrative	50,738	46,128	144,398	131,535
Operating expenses	135,362	118,784	390,075	333,038
Operating income (loss)	30,223	(9,275)	95,185	(35,477)
Other income (expense):
Interest income and other, net	4,672	1,476	9,616	3,100
Interest expense	(1,527)	(6,595)	(4,874)	(24,405)
Income (loss) from continuing operations before income taxes	33,368	(14,394)	99,927	(56,782)
Provision for income taxes	14,188	9,386	36,871	12,543
Equity-method earnings	1,819	4,040	2,985	5,938
Income (loss) from continuing operations	20,999	(19,740)	66,041	(63,387)
Income from discontinued operations, net of income taxes		2,106,796		2,183,884
Net income	$ 20,999	$ 2,087,056	$ 66,041	$ 2,120,497
Basic earnings (loss) per share:
Continuing operations	$ 0.62	$ (0.45)	$ 1.84	$ (1.44)
Net income	0.62	48.11	1.84	48.08
Diluted earnings (loss) per share:
Continuing operations	0.60	(0.45)	1.79	(1.44)
Net income	$ 0.60	$ 46.76	$ 1.79	$ 46.71
Weighted-average common shares outstanding:
Basic	34,079	43,385	35,935	44,103
Diluted	34,779	44,634	36,968	45,394

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 01, 2022	Oct. 02, 2021	Oct. 01, 2022	Oct. 02, 2021
Condensed Consolidated Statements of Comprehensive Income
Net income	$ 20,999	$ 2,087,056	$ 66,041	$ 2,120,497
Net changes to available-for-sale securities
Unrealized losses arising during the period	(3,359)	(492)	(16,064)	(1,892)
Reclassification for (gains) losses included in net income	56	25	479	(372)
Net changes to cash flow hedges
Unrealized losses arising during the period	(1,574)	(246)	(5,119)	(516)
Reclassification for (gains) losses included in net income	1,821	30	2,913	(290)
Other comprehensive loss, before tax	(3,056)	(683)	(17,791)	(3,070)
Provision (benefit) for income taxes	(644)	(143)	(3,743)	(645)
Other comprehensive loss	(2,412)	(540)	(14,048)	(2,425)
Comprehensive income	$ 18,587	$ 2,086,516	$ 51,993	$ 2,118,072

Condensed Consolidated Statements of Changes in Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands	Common Stock	Additional Paid-In Capital	Retained Earnings Cumulative effect of adoption of accounting standard	Retained Earnings	Accumulated Other Comprehensive Income (Loss)	Cumulative effect of adoption of accounting standard	Total
Balance at Jan. 02, 2021	$ 4	$ 204,359		$ 993,664	$ 1,814		$ 1,199,841
Balance (in shares) at Jan. 02, 2021	43,925
Increase (Decrease) in Stockholders' Equity
Net income				2,120,497			2,120,497
Other comprehensive loss					(2,425)		(2,425)
Stock issuances, net of shares withheld for taxes		(12,774)					(12,774)
Stock issuances, net of shares withheld for taxes (in shares)	484
Repurchases of common stock		(229,187)		(465,971)			(695,158)
Repurchases of common stock (in shares)	(4,390)
Stock-based compensation		38,350					38,350
Convertible debt activity		(748)					(748)
Convertible debt activity (in shares)	528
Balance at Oct. 02, 2021	$ 4	0		2,648,190	(611)		2,647,583
Balance (in shares) at Oct. 02, 2021	40,547
Balance at Jul. 03, 2021	$ 4	200,716		1,027,105	(71)		1,227,754
Balance (in shares) at Jul. 03, 2021	44,764
Increase (Decrease) in Stockholders' Equity
Net income				2,087,056			2,087,056
Other comprehensive loss					(540)		(540)
Stock issuances, net of shares withheld for taxes		(1,430)					(1,430)
Stock issuances, net of shares withheld for taxes (in shares)	30
Repurchases of common stock		(210,204)		(465,971)			(676,175)
Repurchases of common stock (in shares)	(4,247)
Stock-based compensation		10,918					10,918
Balance at Oct. 02, 2021	$ 4	0		2,648,190	(611)		2,647,583
Balance (in shares) at Oct. 02, 2021	40,547
Balance at Jan. 01, 2022	$ 4	0	$ (59,963)	2,214,839	(2,419)	$ (59,963)	$ 2,212,424
Balance (in shares) at Jan. 01, 2022	38,481						38,481
Increase (Decrease) in Stockholders' Equity
Net income				66,041			$ 66,041
Other comprehensive loss					(14,048)		(14,048)
Stock issuances, net of shares withheld for taxes		(8,367)					(8,367)
Stock issuances, net of shares withheld for taxes (in shares)	316
Repurchases of common stock	$ (1)	(34,885)		(652,809)	0		(687,695)
Repurchases of common stock (in shares)	(5,267)
Stock-based compensation		43,252					43,252
Balance at Oct. 01, 2022	$ 3	0		1,568,108	(16,467)		$ 1,551,644
Balance (in shares) at Oct. 01, 2022	33,530						33,530
Balance at Jul. 02, 2022	$ 3	0		1,619,396	(14,055)		$ 1,605,344
Balance (in shares) at Jul. 02, 2022	34,223
Increase (Decrease) in Stockholders' Equity
Net income				20,999			20,999
Other comprehensive loss					(2,412)		(2,412)
Stock issuances, net of shares withheld for taxes		(773)					(773)
Stock issuances, net of shares withheld for taxes (in shares)	15
Repurchases of common stock		(15,211)		(72,287)			(87,498)
Repurchases of common stock (in shares)	(708)
Stock-based compensation		15,984					15,984
Balance at Oct. 01, 2022	$ 3	$ 0		$ 1,568,108	$ (16,467)		$ 1,551,644
Balance (in shares) at Oct. 01, 2022	33,530						33,530

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Oct. 01, 2022	Oct. 02, 2021
Operating Activities
Net income	$ 66,041	$ 2,120,497
Adjustments to reconcile net income to net cash provided by operating activities of continuing operations:
Income from discontinued operations, net of income taxes		(2,183,884)
Depreciation of property and equipment	16,514	12,925
Amortization of other intangible assets	27,328	33,971
Amortization of debt discount and debt issuance costs	1,492	17,278
Loss on extinguishment of convertible debt	3	3,370
Stock-based compensation expense	43,213	36,916
Equity-method earnings	(2,985)	(5,938)
Deferred income taxes	(13,126)	(3,132)
Changes in operating assets and liabilities:
Accounts receivable	21,641	22,573
Inventories	(39,100)	(11,320)
Prepaid expenses and other assets	(28,404)	33,536
Accounts payable	26,694	(4,522)
Other current liabilities and income taxes	17,962	(10,981)
Deferred revenue and returns liability	(2,144)	(1,657)
Other non-current liabilities	(7,713)	(11,388)
Net cash provided by operating activities of continuing operations	127,416	48,244
Investing Activities
Purchases of marketable securities	(579,507)	(1,212,572)
Sales of marketable securities	42,952	194,492
Maturities of marketable securities	597,399	173,924
Purchases of property and equipment	(20,057)	(19,468)
Purchases of other assets		(578)
Net cash provided by (used in) investing activities of continuing operations	40,787	(864,202)
Financing Activities
Payments on debt	(21)	(140,572)
Repurchases of common stock	(681,695)	(688,373)
Payment of taxes withheld for vested stock awards	(14,732)	(21,393)
Proceeds from the issuance of common stock	6,366	8,619
Net cash used in financing activities of continuing operations	(690,082)	(841,719)
Discontinued Operations
Operating activities	(69,467)	69,685
Investing activities	0	2,747,684
Net cash provided by (used in) discontinued operations	(69,467)	2,817,369
Increase (decrease) in cash and cash equivalents	(591,346)	1,159,692
Cash and cash equivalents at beginning of period	1,074,623	202,720
Cash and cash equivalents at end of period	$ 483,277	$ 1,362,412

Significant Accounting Policies

9 Months Ended

Oct. 01, 2022

Significant Accounting Policies

Significant Accounting Policies

1.	Significant Accounting Policies

Basis of Presentation and Principles of Consolidation

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles (U.S. GAAP) for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. The information included herein contains all normal recurring accruals and adjustments which, in the opinion of management, are necessary to present fairly Silicon Laboratories Inc.’s (the “Company”) financial position, results of its operations, comprehensive income, stockholders’ equity and cash flows. The Condensed Consolidated Balance Sheet as of January 1, 2022 was derived from the Company’s audited Consolidated Financial Statements. All intercompany balances and transactions have been eliminated in consolidation. The condensed consolidated results of operations for the three and nine months ended October 1, 2022 are not necessarily indicative of the results to be expected for the full year.

These Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and notes thereto for the year ended January 1, 2022, included in the Company’s Form 10-K filed with the Securities and Exchange Commission (SEC) on February 2, 2022.

The Company prepares financial statements on a 52- or 53-week fiscal year that ends on the Saturday closest to December 31. Fiscal 2022 will have 52 weeks and fiscal 2021 had 52 weeks. In a 52-week year, each fiscal quarter consists of 13 weeks.

Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Among the significant estimates affecting the financial statements are those related to inventories, goodwill, acquired intangible assets, other long-lived assets, revenue recognition, stock-based compensation and income taxes. Actual results could differ from those estimates, and such differences could be material to the financial statements. The Company periodically reviews the assumptions used in its financial statement estimates.

Revenue Recognition

Revenue is recognized when control of the promised goods or services is transferred to the customer, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Substantially all of the Company’s contracts with customers contain a single performance obligation, the sale of mixed-signal integrated circuit (IC) products. This performance obligation is satisfied when control of the product is transferred to the customer, which typically occurs upon delivery. Unsatisfied performance obligations primarily represent contracts for products with future delivery dates. The Company has opted to not disclose the amount of unsatisfied performance obligations as these contracts have original expected durations of less than one year.

The transaction price reflects the Company’s expectations about the consideration it will be entitled to receive from the customer and may include fixed or variable amounts. Variable consideration primarily includes sales made to distributors under agreements allowing certain rights of return, referred to as stock rotation, and credits issued to the distributor due to price protection. The Company estimates variable consideration at the most likely amount to which it expects to be entitled. The estimate is based on information available to the Company, including recent sales activity and pricing data. The Company applies a constraint to its variable consideration estimate which considers both the likelihood of a return and the amount of a potential price concession. Variable consideration that does not meet revenue recognition criteria is deferred. The Company records a right of return asset in prepaid expenses and other current assets for the costs of distributor inventory not meeting revenue recognition criteria. A corresponding deferred revenue and returns liability amount is recorded for unrecognized revenue associated with such costs. The Company’s products carry a one-year replacement warranty. Payments are typically due within 30 days of invoicing and do not include a significant financing component.

1.	Significant Accounting Policies (Continued)

Adoption of New Accounting Standard

Convertible Instruments

The Company adopted Financial Accounting Standards Board (FASB) Accounting Standards Update (ASU) No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging— Contracts in Entity’s Own Equity (Subtopic 815-40, on January 2, 2022, the first day of its fiscal year ending December 31, 2022. The Company elected the modified retrospective transition method of adoption at the beginning of the period of adoption through a cumulative-effect adjustment. Prior periods have not been adjusted. The following reflects the material changes recorded in connection with the cumulative-effect adjustment (in thousands):


	Increase
Financial Statement Line Item	(Decrease)
Current portion of convertible debt, net	$	76,991
Other non-current liabilities	$	(17,028)
Retained earnings	$	(59,963)

The primary impact of the Company’s adoption of ASU 2020-06 was to increase the carrying value of its convertible debt, representing the unamortized debt discount, and reduce deferred tax liabilities related to convertible debt. The adoption reduced reported interest expense recorded in connection with convertible debt, which increased basic earnings per share and diluted earnings per share by $0.12 and $0.12, respectively, for the three months ended October 1, 2022, and by $0.34 and $0.33, respectively, for the nine months ended October 1, 2022.

Discontinued Operations

9 Months Ended

Oct. 01, 2022

Discontinued Operations.

Discontinued Operations

2.Discontinued Operations

On July 26, 2021, the Company sold its infrastructure and automotive business to Skyworks Solutions, Inc. for $2.75 billion in cash. The financial results of the infrastructure and automotive business, which are readily distinguishable from other components of the Company, have been presented as discontinued operations in the Condensed Consolidated Financial Statements because the sale represented a strategic shift for the Company.

The following table presents the financial results of the infrastructure and automotive business (the “discontinued operations”) in the Company’s Condensed Consolidated Statements of Income (in thousands, except per share data):


	Three Months Ended		Nine Months Ended
	October 2,		October 2,
	2021		2021
Revenues	$	28,203	$	233,915
Costs of revenues		11,891		95,800
Operating expenses		(496)		46,512
Operating income from discontinued operations		16,808		91,603
Gain on sale of discontinued operations		2,423,161		2,423,161
Income from discontinued operations before income taxes		2,439,969		2,514,764
Provision for income taxes		333,173		330,880
Income from discontinued operations	$	2,106,796	$	2,183,884

Income from discontinued operations per share:
Basic	$	48.56	$	49.52
Diluted	$	47.20	$	48.11

2.Discontinued Operations (Continued)

Continuing Involvement

In connection with the closing of the sale, the Company entered into certain ancillary agreements with Skyworks, including a Transition Services Agreement (“TSA”). Through the TSA, the Company has subleased certain premises to Skyworks and will provide or provides various temporary support services for three to eighteen months after the close of the transaction, depending on the service provided. Although the services provided under the TSA will generate continuing cash flows between the Company and Skyworks for the duration of the TSA, the amounts have not been nor are expected to be material to the ongoing operations of either entity. Fees received by the Company under the TSA were approximately $4.8 million for the nine months ended October 1, 2022.

Earnings (Loss) Per Share

9 Months Ended

Oct. 01, 2022

Earnings (Loss) Per Share

Earnings (Loss) Per Share

3.	Earnings (Loss) Per Share

The following table sets forth the computation of basic and diluted earnings (loss) per share from continuing operations (in thousands, except per share data):


	Three Months Ended				Nine Months Ended
	October 1,		October 2,		October 1,		October 2,
	2022		2021		2022		2021
Income (loss) from continuing operations	$	20,999	$	(19,740)	$	66,041	$	(63,387)

Shares used in computing basic earnings (loss) per share		34,079		43,385		35,935		44,103

Effect of dilutive securities:
Stock-based awards and convertible debt		700		—		1,033		—
Shares used in computing diluted earnings (loss) per share		34,779		43,385		36,968		44,103

Earnings (loss) per share:
Basic	$	0.62	$	(0.45)	$	1.84	$	(1.44)
Diluted	$	0.60	$	(0.45)	$	1.79	$	(1.44)

Diluted shares for the three and nine months ended October 2, 2021 excluded 1.2 million and 1.3 million shares, respectively, due to the Company’s loss from continuing operations for the periods.

The Company has irrevocably elected to settle the principal amount of its convertible senior notes in cash and intends to settle any excess value in shares in the event of a conversion. For the three months ended October 1, 2022 and October 2, 2021 and the nine months ended October 1, 2022 and October 2, 2021, approximately 0.4 million, 0.7 million, 0.7 million and 0.8 million shares, respectively, were included in the denominator for the calculation of diluted earnings per share. See Note 7, Debt, to the Condensed Consolidated Financial Statements for additional information.

Fair Value of Financial Instruments

9 Months Ended

Oct. 01, 2022

Fair Value of Financial Instruments

Fair Value of Financial Instruments

4.	Fair Value of Financial Instruments

The fair values of the Company’s financial instruments are recorded using a hierarchical disclosure framework based upon the level of subjectivity of the inputs used in measuring assets and liabilities. The three levels are described below:

Level 1 – Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date.

Level 2 – Inputs other than Level 1 that are directly or indirectly observable, such as quoted prices for similar assets or liabilities and quoted prices in less active markets.

Level 3 – Inputs are unobservable for the asset or liability and are developed based on the best information available in the circumstances, which might include the Company’s own data.

4.	Fair Value of Financial Instruments (Continued)

The following summarizes the valuation of the Company’s financial instruments (in thousands). The tables do not include either cash on hand or assets and liabilities that are measured at historical cost or any basis other than fair value.


	Fair Value Measurements
	at October 1, 2022 Using
	Quoted Prices in		Significant Other
	Active Markets for		Observable
	Identical Assets		Inputs
Description	(Level 1)		(Level 2)		Total
Assets:
Cash equivalents:
Money market funds	$	301,640	$	—	$	301,640
Government debt securities		12,988		—		12,988
Corporate debt securities		—		27,230		27,230
Total cash equivalents	$	314,628	$	27,230	$	341,858

Short-term investments:
Government debt securities	$	207,560	$	99,051	$	306,611
Corporate debt securities		—		586,520		586,520
Total short-term investments	$	207,560	$	685,571	$	893,131

Total	$	522,188	$	712,801	$	1,234,989


	Fair Value Measurements
	at January 1, 2022 Using
	Quoted Prices in		Significant Other		Significant
	Active Markets for		Observable		Unobservable
	Identical Assets		Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Cash equivalents:
Money market funds	$	845,740	$	—	$	—	$	845,740
Corporate debt securities		—		3,552		—		3,552
Government debt securities		—		2,950		—		2,950
Total cash equivalents	$	845,740	$	6,502	$	—	$	852,242

Short-term investments:
Government debt securities	$	71,509	$	119,612	$	—	$	191,121
Corporate debt securities		—		773,461		—		773,461
Total short-term investments	$	71,509	$	893,073	$	—	$	964,582

Other assets, net:
Auction rate securities	$	—	$	—	$	4,980	$	4,980
Total	$	—	$	—	$	4,980	$	4,980

Total	$	917,249	$	899,575	$	4,980	$	1,821,804

4.	Fair Value of Financial Instruments (Continued)

Valuation methodology

The Company’s cash equivalents and short-term investments that are classified as Level 2 are valued using non-binding market consensus prices that are corroborated with observable market data; quoted market prices for similar instruments in active markets; quoted prices in less active markets; or pricing models, such as a discounted cash flow model, with all significant inputs derived from or corroborated with observable market data. Investments classified as Level 3 are valued using a discounted cash flow model. The assumptions used in preparing the discounted cash flow model include estimates for interest rates, amount of cash flows, expected holding periods of the securities and a discount to reflect the Company’s inability to liquidate the securities. The Company’s foreign currency derivative instruments are valued using discounted cash flow models. The assumptions used in preparing the valuation models include foreign exchange rates, forward and spot prices for currencies and market observable data of similar instruments.

Contractual maturities of investments

The Company’s investments are reported at fair value, with unrealized gains and losses, net of tax, recorded as a component of accumulated other comprehensive loss in the Consolidated Balance Sheet. The following summarizes the contractual underlying maturities of the Company’s available-for-sale investments at October 1, 2022 (in thousands):


			Fair
	Cost		Value
Due in one year or less	$	611,264	$	601,513
Due after one year through ten years		315,952		307,056
Due after ten years		24,780		24,780
	$	951,996	$	933,349

Available-for-sale investments

The available-for-sale investments that were in a continuous unrealized loss position, aggregated by length of time that individual securities have been in a continuous loss position, were as follows (in thousands):


	Less Than 12 Months				12 Months or Greater				Total
			Gross				Gross				Gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
As of October 1, 2022	Value		Losses		Value		Losses		Value		Losses
Government debt securities	$	225,388	$	(3,880)	$	55,508	$	(2,599)	$	280,896	$	(6,479)
Corporate debt securities		470,762		(9,524)		104,386		(2,647)		575,148		(12,171)
	$	696,150	$	(13,404)	$	159,894	$	(5,246)	$	856,044	$	(18,650)


	Less Than 12 Months				12 Months or Greater				Total
			Gross				Gross				Gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
As of January 1, 2022	Value		Losses		Value		Losses		Value		Losses
Government debt securities	$	126,957	$	(750)	$	—	$	—	$	126,957	$	(750)
Corporate debt securities		418,917		(1,451)		326		(1)		419,243		(1,452)
Auction rate securities		—		—		4,980		(1,020)		4,980		(1,020)
	$	545,874	$	(2,201)	$	5,306	$	(1,021)	$	551,180	$	(3,222)

The gross unrealized losses as of October 1, 2022 were due primarily to changes in market interest rates. The gross unrealized losses as of January 1, 2022 were due primarily to changes in market interest rates and the illiquidity of the Company’s auction-rate securities.

4.	Fair Value of Financial Instruments (Continued)

The Company records an allowance for credit loss when a decline in investment market value is due to credit-related factors. When evaluating an investment for impairment, the Company reviews factors such as the severity of the impairment, changes in underlying credit ratings, forecasted recovery, the Company’s intent to sell or the likelihood that it would be required to sell the investment before its anticipated recovery in market value and the probability that the scheduled cash payments will continue to be made. As of October 1, 2022, there were no material declines in the market value of available-for-sale investments due to credit-related factors.

At October 1, 2022 and January 1, 2022, there were no material unrealized gains associated with the Company’s available-for-sale investments.

Level 3 fair value measurements

The following summarizes the activity in Level 3 financial instruments for the nine months ended October 1, 2022 (in thousands):

Assets


	Nine Months
Auction Rate Securities	Ended
Beginning balance	$	4,980
Sales (1)		(6,000)
Loss recognized in earnings		300
Gain included in other comprehensive loss		720
Balance at October 1, 2022	$	—

(1)On May 31, 2022, the Company sold its prior remaining holding of auction-rate securities for $5.7 million.

Fair values of other financial instruments

The Company’s debt is recorded at cost, but is measured at fair value for disclosure purposes. The fair value of the Company’s convertible senior notes is determined using observable market prices. The notes are traded in less active markets and are therefore classified as a Level 2 fair value measurement. As of October 1, 2022 and January 1, 2022, the fair value of the notes was $636.2 million and $944.3 million, respectively.

The Company’s other financial instruments, including cash, accounts receivable and accounts payable, are recorded at amounts that approximate their fair values due to their short maturities.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Derivative Financial Instruments

9 Months Ended

Oct. 01, 2022

Derivative Financial Instruments

Derivative Financial Instruments

5.	Derivative Financial Instruments

The Company uses derivative financial instruments to manage certain exposures to the variability of foreign currency exchange rates. The Company’s objective is to offset increases and decreases in expenses resulting from these exposures with gains and losses on the derivative contracts, thereby reducing volatility of earnings. The Company does not use derivative contracts for speculative or trading purposes. The Company recognizes derivatives, on a gross basis, in the Consolidated Balance Sheet at fair value. Cash flows from derivatives are classified according to the nature of the cash receipt or payment in the Consolidated Statement of Cash Flows.

5.	Derivative Financial Instruments (Continued)

Cash Flow Hedges

Foreign Currency Forward Contracts

The Company uses foreign currency forward contracts to reduce the earnings impact that exchange rate fluctuations have on operating expenses denominated in currencies other than the U.S. dollar. Changes in the fair value of the contracts are recorded in accumulated other comprehensive loss in the Consolidated Balance Sheet and subsequently reclassified into earnings in the period during which the hedged transaction is recognized. The reclassified amount is reported in the same financial statement line item as the hedged item. If the foreign currency forward contracts are terminated or can no longer qualify as hedging instruments prior to maturity, the fair value of the contracts recorded in accumulated other comprehensive loss may be recognized in the Consolidated Statement of Income based on an assessment of the contracts at the time of termination.

The Company has entered into foreign currency forward contracts for a portion of its forecasted operating expenses denominated in the Euro, Hungarian Forint, Indian Rupee and Norwegian Krone. As of October 1, 2022, the contracts had maturities of one to three months and an aggregate notional value of $16.3 million. Gains and losses expected to be reclassified into earnings in the next twelve months were not material. The fair value of the contracts, contract gains or losses recognized in other comprehensive loss and amounts reclassified from accumulated other comprehensive loss into earnings were not material for any of the periods presented.

Supplemental Information

9 Months Ended

Oct. 01, 2022

Supplemental Information

Supplemental Information

6.	Supplemental Information

The following shows the details of selected Condensed Consolidated Balance Sheet items (in thousands):

Inventories


	October 1,		January 1,
	2022		2022
Work in progress	$	65,161	$	36,078
Finished goods		23,286		13,229
	$	88,447	$	49,307

Lease income

The Company leases a portion of its headquarter facilities to other tenants. Lease income from operating leases was $5.4 million and $3.1 million during the nine months ended October 1, 2022 and October 2, 2021, respectively.

Debt

9 Months Ended

Oct. 01, 2022

Debt

Debt

Debt

0.625% Convertible Senior Notes

On June 1, 2020, the Company completed a private placement of $535 million principal amount convertible senior notes (the “2025 Notes”). The 2025 Notes bear interest semi-annually at a rate of 0.625% per year and mature on June 15, 2025.

The 2025 Notes are convertible at a conversion rate of 8.1980 shares of common stock per $1,000 principal amount of the 2025 Notes, or approximately 4.4 million shares of common stock, which is equivalent to a conversion price of approximately $121.98 per share. The conversion rate is subject to adjustment under certain circumstances. Holders may convert the 2025 Notes under the following circumstances: during any calendar quarter after the calendar quarter ended on September 30, 2020 if the closing price of the Company’s common stock for at least 20 trading days in the 30 consecutive trading days ending on the last trading day of the preceding calendar quarter is greater than or equal to $159.51 per share, representing 130% of the conversion price of the 2025 Notes (“the Sales Price Trigger”); during the five business day period after any ten consecutive trading day period (the “measurement period”) in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the closing sale price of our common stock and the conversion rate on each such trading day; if specified distributions or corporate events occur; if the Notes are called for redemption; or at any time after March 15, 2025. The Company may redeem all or any portion of the 2025 Notes, at its option, on or after June 20, 2023, if the last reported sale price of the Company’s common stock has been at least 130% of the conversion price then in effect for at least 20 trading days during any 30 consecutive trading day period. As of January 1, 2022, upon conversion, the 2025 Notes could be settled in cash, shares of the Company’s common stock or a combination of cash and shares, at the Company’s election. On January 2, 2022, the Company irrevocably elected cash settlement for the principal amount of the 2025 Notes. The Company intends to settle any excess value in shares in the event of a conversion.

The 2025 Notes were classified as current liabilities at January 1, 2022 due to the Sales Price Trigger condition being met on January 1, 2022. The Sales Price Trigger condition has not been met during the nine months ended October 1, 2022, therefore the net carrying amount of the 2025 Notes is now classified as a non-current liability.

The principal balance of the 2025 Notes was initially separated into liability and equity components, and recorded at fair value. The excess of the principal amount of the liability component over its carrying amount represented the debt discount, which was amortized to interest expense over the term of the 2025 Notes using the effective interest method. With the Company’s adoption of ASU 2020-06 in fiscal 2022, the principal balance of the 2025 Notes is no longer separated between liability and equity components. This resulted in an increase to the carrying value of its convertible debt, representing the unamortized debt discount as of January 2, 2022, with an offsetting reduction in stockholders’ equity.

The Company incurred debt issuance costs of approximately $10.4 million, which were allocated to the liability and equity components in proportion to the allocation of the proceeds. Upon the adoption of ASU 2020-06, the equity component was reclassified to liabilities and remeasured to reflect cumulative amortization since the issuance of the 2025 Notes.

7.	Debt (Continued)

The carrying amount of the 2025 Notes consisted of the following (in thousands):


	October 1,		January 1,
	2022		2022
Liability component
Principal	$	534,980	$	535,000
Unamortized debt discount		—		(78,519)
Unamortized debt issuance costs		(5,918)		(5,882)
Net carrying amount	$	529,062	$	450,599

Equity component
Net carrying amount	$	—	$	107,928

The liability component of the 2025 Notes is recorded in convertible debt on the Consolidated Balance Sheet. Prior to the Company’s adoption of ASU 2020-06, the equity component of the 2025 Notes was recorded in stockholders’ equity. The effective interest rate for the liability component was 5.336%. As of October 1, 2022, the remaining period over which the debt issuance costs will be amortized was 2.7 years.

Interest expense related to the notes was comprised of the following (in thousands):


	Three Months Ended				Nine Months Ended
	October 1,		October 2,		October 1,		October 2,
	2022		2021		2022		2021
Contractual interest expense	$	826	$	836	$	2,511	$	2,835
Amortization of debt discount		—		5,076		—		16,005
Amortization of debt issuance costs		498		380		1,492		1,273
	$	1,324	$	6,292	$	4,003	$	20,113

Credit Facility

The Company and certain of its domestic subsidiaries (the “Guarantors”) have a $400 million revolving credit facility with a maturity date of August 7, 2024. The credit facility includes a $25 million letter of credit sublimit and a $10 million swingline loan sublimit. The Company also has an option to increase the size of the borrowing capacity by up to the greater of an aggregate of $250 million and 100% of EBITDA of the last four fiscal quarters, plus an amount that would not cause a secured leverage ratio (funded debt secured by assets/EBITDA) to exceed 3.25 to 1.00, subject to certain conditions.

The credit facility, other than swingline loans, will bear interest at the Eurodollar rate plus an applicable margin or, at the option of the Company, a base rate (defined as the highest of the Wells Fargo prime rate, the Federal Funds rate plus 0.50% and the Eurodollar Base Rate plus 1.00%) plus an applicable margin. Swingline loans accrue interest at the base rate plus the applicable margin for base rate loans. The applicable margins for the Eurodollar rate loans range from 1.00% to 1.75% and for base rate loans range from 0.00% to 0.75%, depending in each case, on the leverage ratio as defined in the credit facility.

The credit facility contains various conditions, covenants and representations with which the Company must be in compliance in order to borrow funds and to avoid an event of default, including financial covenants that the Company must maintain a net leverage ratio (funded indebtedness/EBITDA) of no more than 4.25 to 1, a secured leverage ratio of no more than 3.50 to 1, and a minimum interest coverage ratio (EBITDA/interest payments) of no less than 2.50 to 1. As of October 1, 2022, the Company was in compliance with all covenants of the credit facility. The Company’s obligations under the credit facility are guaranteed by the Guarantors and are secured by a security interest in substantially all assets of the Company and the Guarantors. As of October 1, 2022, no amounts were outstanding on the credit facility.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

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+ Details

Commitments and Contingencies

9 Months Ended

Oct. 01, 2022

Commitments and Contingencies

Commitments and Contingencies

8.	Commitments and Contingencies

Litigation

On August 11, 2022, August 26, 2022 and October 11, 2022, Bell Semiconductor, LLC (“Bell”) filed three separate patent infringement actions against the Company in the U.S. District Court for the District of Massachusetts. Bell alleges in these actions that four U.S. patents are infringed by the use of certain computer-aided-design (CAD) tools to design integrated circuits. The patents in these suits are U.S. Patent Nos. 7,007,259, 7,149,989, 7,260,803 and 7,396,760. In each of these actions, Bell seeks unspecified damages, attorney fees and a permanent injunction. On October 14, 2022, Bell filed a complaint with the U.S. International Trade Commission (“ITC”) alleging violations of Section 337 of the Tariff Act of 1930 based on alleged importation of articles and components that infringe U.S. Patent No. 7,396,760. The ITC complaint seeks institution of an investigation and an exclusion order to prevent the importation and sale of allegedly infringing products in the U.S. The Company intends to vigorously defend against these allegations. Bell has brought similar claims against Skyworks Solutions, Inc. (“Skyworks”), and Skyworks has requested indemnification from the Company under the Asset Purchase Agreement dated April 22, 2021. The Company is unable to predict the outcome of these matters due to the many uncertainties associated with such actions, nor is it able to reasonably estimate the amount or range of possible losses, if any. As of October 1, 2022, no loss contingencies have been accrued for these matters in the Company’s Condensed Consolidated Financial Statements.

Other

The Company is involved in various other legal proceedings that have arisen in the normal course of business. While the ultimate results cannot be predicted with certainty, the Company does not expect them to have a material adverse effect on its Consolidated Financial Statements.

Revenues

9 Months Ended

Oct. 01, 2022

Revenues

Revenues

9.	Revenues

The Company groups its products as Industrial & Commercial or Home & Life based on the target markets they address. The following represents revenue by product category (in thousands):


	Three Months Ended				Nine Months Ended
	October 1,		October 2,		October 1,		October 2,
	2022		2021		2022		2021
Industrial & Commercial	$	145,661	$	93,339	$	416,475	$	261,475
Home & Life		124,156		91,492		350,306		250,705
	$	269,817	$	184,831	$	766,781	$	512,180

A portion of the Company’s sales are made to distributors under agreements allowing certain rights of return and/or price protection related to the final selling price to the end customers. These factors impact the timing and uncertainty of revenues and cash flows. During the three months ended October 1, 2022 and October 2, 2021 and the nine months ended October 1, 2022 and October 2, 2021, the Company recognized revenue of $4.5 million, $10.0 million, $30.7 million and $10.9 million, respectively, from performance obligations that were satisfied in previous reporting periods. The following disaggregates the Company's revenue by sales channel (in thousands):


	Three Months Ended				Nine Months Ended
	October 1,		October 2,		October 1,		October 2,
	2022		2021		2022		2021
Distributors	$	217,355	$	148,773	$	621,563	$	414,692
Direct customers		52,462		36,058		145,218		97,488
	$	269,817	$	184,831	$	766,781	$	512,180

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

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+ Details

Stock-Based Compensation

9 Months Ended

Oct. 01, 2022

Stock-Based Compensation

Stock-Based Compensation

10.

Stock-Based Compensation

Stock-based compensation costs are based on the fair values on the date of grant for stock awards and stock options and on the date of enrollment for the employee stock purchase plans. The fair values of stock awards (such as restricted stock units (RSUs), performance stock units (PSUs) and restricted stock awards (RSAs)) are estimated based on their intrinsic values. The fair values of market stock awards (MSUs) are estimated using a Monte Carlo simulation. The fair values of stock options and employee stock purchase plans are estimated using the Black-Scholes option-pricing model.

The following table presents details of stock-based compensation costs recognized in the Condensed Consolidated Statements of Income (in thousands):


	Three Months Ended				Nine Months Ended
	October 1,		October 2,		October 1,		October 2,
	2022		2021		2022		2021
Cost of revenues	$	288	$	261	$	834	$	696
Research and development		8,788		7,071		23,482		18,190
Selling, general and administrative		6,874		6,964		18,897		18,030
		15,950		14,296		43,213		36,916
Income tax (provision) benefit		1,230		(627)		4,444		632
Share-based compensation – continuing operations		14,720		14,923		38,769		36,284
Share-based compensation – discontinued operations, net		—		(4,115)		—		(1,006)
Total	$	14,720	$	10,808	$	38,769	$	35,278

The Company had approximately $123.4 million of total unrecognized compensation cost related to equity grants as of October 1, 2022 that is expected to be recognized over a weighted-average period of approximately 2.3 years. There were no significant stock-based compensation costs capitalized into assets in any of the periods presented.

Income Taxes

9 Months Ended

Oct. 01, 2022

Income Taxes

Income Taxes

11.

Income Taxes

Provision for income taxes includes both domestic and foreign income taxes at the applicable tax rates adjusted for non-deductible expenses, research and development tax credits and other permanent differences. Income tax expense was $14.2 million and $9.4 million for the three months ended October 1, 2022 and October 2, 2021, resulting in effective tax rates of 40.3% and (90.7)%, respectively. Income tax expense was $36.9 million and $12.5 million for the nine months ended October 1, 2022 and October 2, 2021, resulting in effective tax rates of 35.8% and (24.7)%, respectively. The increase in the effective tax rate for the three and nine months ended October 1, 2022 was primarily due to the recognition of certain tax benefits for the three and nine months ended October 2, 2021 in discontinued operations under FASB ASU 2019-12, Simplifying the Accounting for Income Taxes, and the required adoption of new U.S. tax rules regarding the capitalization of research and experimental costs in the current fiscal year.

Under ASU 2019-12, the income tax benefit of a loss from continuing operations should be recognized in discontinued operations if the Company would be unable to benefit from the loss without considering the income from discontinued operations. As such, tax benefits associated with losses incurred for the three and nine months ended October 2, 2021 were recognized in discontinued operations.

The Tax Cuts and Jobs Act (the “Act”) was enacted on December 22, 2017. Under the Act, research and experimental expenditures incurred for tax years beginning after December 31, 2021 must be capitalized and amortized ratably over five or fifteen years for tax purposes, depending on where the research activities are conducted. The Company has elected to treat global intangible low-taxed income (GILTI) as a period cost so the capitalization of research and experimental costs in GILTI increases the Company’s provision for income taxes.

11.

Income Taxes (Continued)

Uncertain Tax Positions

As of October 1, 2022, the Company had gross unrecognized tax benefits, inclusive of interest, of $4.6 million, all of which would affect the effective tax rate if recognized. During the nine months ended October 1, 2022, the Company did not release any unrecognized tax benefits.

The Company recognizes interest and penalties related to unrecognized tax benefits in the provision for income taxes. These amounts were not material for any of the periods presented.

Following the completion of the Norwegian Tax Administration (“NTA”) examination of the Company’s Norwegian subsidiary for income tax matters relating to fiscal years 2013 - 2016, the Company received an assessment from the NTA in December 2017 concerning an adjustment to its 2013 taxable income related to the pricing of an intercompany transaction. The Company is currently appealing the assessment. The adjustment to the pricing of the intercompany transaction results in approximately 141.3 million Norwegian kroner, or $13.1 million, additional Norwegian income tax. The Company disagrees with the NTA’s assessment and believes the Company’s position on this matter is more likely than not to be sustained. The Company plans to exhaust all available administrative remedies, and if unable to resolve this matter through administrative remedies with the NTA, the Company plans to pursue judicial remedies.

The Company believes that it has accrued adequate reserves related to all matters contained in tax periods open to examination. Should the Company experience an unfavorable outcome in the NTA matter, however, such an outcome could have a material impact on its financial statements.

Tax years 2015 through 2022 remain open to examination by the major taxing jurisdictions in which the Company operates. The Company is not currently under audit in any major taxing jurisdiction.

The Company believes it is reasonably possible that its gross unrecognized tax benefits will decrease by approximately $0.5 million, inclusive of interest, in the next 12 months due to the lapse of the statute of limitations.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

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+ Details

Significant Accounting Policies (Policies)

9 Months Ended

Oct. 01, 2022

Significant Accounting Policies

Use of Estimates

Use of Estimates

Revenue Recognition

Revenue Recognition

Adoption of New Accounting Standard

Adoption of New Accounting Standard

Convertible Instruments


	Increase
Financial Statement Line Item	(Decrease)
Current portion of convertible debt, net	$	76,991
Other non-current liabilities	$	(17,028)
Retained earnings	$	(59,963)

- Definition

Disclosure of accounting policy for revenue from contract with customer.

+ References

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-Topic 606
-SubTopic 10
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+ Details

Significant Accounting Policies (Tables)

9 Months Ended

Oct. 01, 2022

Significant Accounting Policies

Schedule of material changes recorded in connection with the cumulative-effect adjustment

The following reflects the material changes recorded in connection with the cumulative-effect adjustment (in thousands):


	Increase
Financial Statement Line Item	(Decrease)
Current portion of convertible debt, net	$	76,991
Other non-current liabilities	$	(17,028)
Retained earnings	$	(59,963)

Discontinued Operations (Tables)

9 Months Ended

Oct. 01, 2022

Discontinued Operations.

Schedule of financial results, assets and liabilities from discontinued operations


	Three Months Ended		Nine Months Ended
	October 2,		October 2,
	2021		2021
Revenues	$	28,203	$	233,915
Costs of revenues		11,891		95,800
Operating expenses		(496)		46,512
Operating income from discontinued operations		16,808		91,603
Gain on sale of discontinued operations		2,423,161		2,423,161
Income from discontinued operations before income taxes		2,439,969		2,514,764
Provision for income taxes		333,173		330,880
Income from discontinued operations	$	2,106,796	$	2,183,884

Income from discontinued operations per share:
Basic	$	48.56	$	49.52
Diluted	$	47.20	$	48.11

- Definition

Tabular disclosure of information related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component.

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+ Details

Earnings (Loss) Per Share (Tables)

9 Months Ended

Oct. 01, 2022

Earnings (Loss) Per Share

Schedule of computation of basic and diluted earnings (loss) per share

The following table sets forth the computation of basic and diluted earnings (loss) per share from continuing operations (in thousands, except per share data):


	Three Months Ended				Nine Months Ended
	October 1,		October 2,		October 1,		October 2,
	2022		2021		2022		2021
Income (loss) from continuing operations	$	20,999	$	(19,740)	$	66,041	$	(63,387)

Shares used in computing basic earnings (loss) per share		34,079		43,385		35,935		44,103

Effect of dilutive securities:
Stock-based awards and convertible debt		700		—		1,033		—
Shares used in computing diluted earnings (loss) per share		34,779		43,385		36,968		44,103

Earnings (loss) per share:
Basic	$	0.62	$	(0.45)	$	1.84	$	(1.44)
Diluted	$	0.60	$	(0.45)	$	1.79	$	(1.44)

Fair Value of Financial Instruments (Tables)

9 Months Ended

Oct. 01, 2022

Fair Value of Financial Instruments

Summary of valuation of the financial instruments


	Fair Value Measurements
	at October 1, 2022 Using
	Quoted Prices in		Significant Other
	Active Markets for		Observable
	Identical Assets		Inputs
Description	(Level 1)		(Level 2)		Total
Assets:
Cash equivalents:
Money market funds	$	301,640	$	—	$	301,640
Government debt securities		12,988		—		12,988
Corporate debt securities		—		27,230		27,230
Total cash equivalents	$	314,628	$	27,230	$	341,858

Short-term investments:
Government debt securities	$	207,560	$	99,051	$	306,611
Corporate debt securities		—		586,520		586,520
Total short-term investments	$	207,560	$	685,571	$	893,131

Total	$	522,188	$	712,801	$	1,234,989


	Fair Value Measurements
	at January 1, 2022 Using
	Quoted Prices in		Significant Other		Significant
	Active Markets for		Observable		Unobservable
	Identical Assets		Inputs		Inputs
Description	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Cash equivalents:
Money market funds	$	845,740	$	—	$	—	$	845,740
Corporate debt securities		—		3,552		—		3,552
Government debt securities		—		2,950		—		2,950
Total cash equivalents	$	845,740	$	6,502	$	—	$	852,242

Short-term investments:
Government debt securities	$	71,509	$	119,612	$	—	$	191,121
Corporate debt securities		—		773,461		—		773,461
Total short-term investments	$	71,509	$	893,073	$	—	$	964,582

Other assets, net:
Auction rate securities	$	—	$	—	$	4,980	$	4,980
Total	$	—	$	—	$	4,980	$	4,980

Total	$	917,249	$	899,575	$	4,980	$	1,821,804

Schedule of maturities of the Company's available-for-sale investments and money market funds

The following summarizes the contractual underlying maturities of the Company’s available-for-sale investments at October 1, 2022 (in thousands):


			Fair
	Cost		Value
Due in one year or less	$	611,264	$	601,513
Due after one year through ten years		315,952		307,056
Due after ten years		24,780		24,780
	$	951,996	$	933,349

Schedule of available-for-sale investments in continuous unrealized loss position


	Less Than 12 Months				12 Months or Greater				Total
			Gross				Gross				Gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
As of October 1, 2022	Value		Losses		Value		Losses		Value		Losses
Government debt securities	$	225,388	$	(3,880)	$	55,508	$	(2,599)	$	280,896	$	(6,479)
Corporate debt securities		470,762		(9,524)		104,386		(2,647)		575,148		(12,171)
	$	696,150	$	(13,404)	$	159,894	$	(5,246)	$	856,044	$	(18,650)


	Less Than 12 Months				12 Months or Greater				Total
			Gross				Gross				Gross
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized
As of January 1, 2022	Value		Losses		Value		Losses		Value		Losses
Government debt securities	$	126,957	$	(750)	$	—	$	—	$	126,957	$	(750)
Corporate debt securities		418,917		(1,451)		326		(1)		419,243		(1,452)
Auction rate securities		—		—		4,980		(1,020)		4,980		(1,020)
	$	545,874	$	(2,201)	$	5,306	$	(1,021)	$	551,180	$	(3,222)

Summary of activity in Level 3 financial instruments

The following summarizes the activity in Level 3 financial instruments for the nine months ended October 1, 2022 (in thousands):

Assets


	Nine Months
Auction Rate Securities	Ended
Beginning balance	$	4,980
Sales (1)		(6,000)
Loss recognized in earnings		300
Gain included in other comprehensive loss		720
Balance at October 1, 2022	$	—

(1)On May 31, 2022, the Company sold its prior remaining holding of auction-rate securities for $5.7 million.

Supplemental Information (Tables)

9 Months Ended

Oct. 01, 2022

Supplemental Information

Schedule of Inventories

The following shows the details of selected Condensed Consolidated Balance Sheet items (in thousands):

Inventories


	October 1,		January 1,
	2022		2022
Work in progress	$	65,161	$	36,078
Finished goods		23,286		13,229
	$	88,447	$	49,307

Debt (Tables)

9 Months Ended

Oct. 01, 2022

Debt

Summary of information about the equity and liability components of convertible debt

The carrying amount of the 2025 Notes consisted of the following (in thousands):


	October 1,		January 1,
	2022		2022
Liability component
Principal	$	534,980	$	535,000
Unamortized debt discount		—		(78,519)
Unamortized debt issuance costs		(5,918)		(5,882)
Net carrying amount	$	529,062	$	450,599

Equity component
Net carrying amount	$	—	$	107,928

Schedule of components of interest expense

Interest expense related to the notes was comprised of the following (in thousands):


	Three Months Ended				Nine Months Ended
	October 1,		October 2,		October 1,		October 2,
	2022		2021		2022		2021
Contractual interest expense	$	826	$	836	$	2,511	$	2,835
Amortization of debt discount		—		5,076		—		16,005
Amortization of debt issuance costs		498		380		1,492		1,273
	$	1,324	$	6,292	$	4,003	$	20,113

Revenues (Tables)

9 Months Ended

Oct. 01, 2022

Revenues

Schedule of disaggregation of revenue

The following represents revenue by product category (in thousands):


	Three Months Ended				Nine Months Ended
	October 1,		October 2,		October 1,		October 2,
	2022		2021		2022		2021
Industrial & Commercial	$	145,661	$	93,339	$	416,475	$	261,475
Home & Life		124,156		91,492		350,306		250,705
	$	269,817	$	184,831	$	766,781	$	512,180

The following disaggregates the Company's revenue by sales channel (in thousands):


	Three Months Ended				Nine Months Ended
	October 1,		October 2,		October 1,		October 2,
	2022		2021		2022		2021
Distributors	$	217,355	$	148,773	$	621,563	$	414,692
Direct customers		52,462		36,058		145,218		97,488
	$	269,817	$	184,831	$	766,781	$	512,180

Stock-Based Compensation (Tables)

9 Months Ended

Oct. 01, 2022

Stock-Based Compensation

Schedule of stock-based compensation costs recognized in the Condensed Consolidated Statements of Income

The following table presents details of stock-based compensation costs recognized in the Condensed Consolidated Statements of Income (in thousands):


	Three Months Ended				Nine Months Ended
	October 1,		October 2,		October 1,		October 2,
	2022		2021		2022		2021
Cost of revenues	$	288	$	261	$	834	$	696
Research and development		8,788		7,071		23,482		18,190
Selling, general and administrative		6,874		6,964		18,897		18,030
		15,950		14,296		43,213		36,916
Income tax (provision) benefit		1,230		(627)		4,444		632
Share-based compensation – continuing operations		14,720		14,923		38,769		36,284
Share-based compensation – discontinued operations, net		—		(4,115)		—		(1,006)
Total	$	14,720	$	10,808	$	38,769	$	35,278

Significant Accounting Policies - Basis of Presentation and Principles of Consolidation (Details)	9 Months Ended	12 Months Ended
	Oct. 01, 2022	Jan. 01, 2022
Significant Accounting Policies
Length of fiscal year	364 days	364 days
Number of days in each fiscal quarter for 52-week fiscal year	91 days
Minimum
Significant Accounting Policies
Length of fiscal year	364 days
Maximum
Significant Accounting Policies
Length of fiscal year	371 days

Significant Accounting Policies - Adoption of New Accounting Standards (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 01, 2022	Oct. 02, 2021	Oct. 01, 2022	Oct. 02, 2021	Jan. 02, 2022	Jan. 01, 2022
Significant Accounting Policies
Current portion of convertible debt, net						$ 450,599
Other non-current liabilities	$ 49,890		$ 49,890			77,044
Retained earnings	$ 1,568,108		$ 1,568,108			$ 2,214,839
Basic (in dollars per share)	$ 0.62	$ 48.11	$ 1.84	$ 48.08
Diluted (in dollars per share)	0.60	$ 46.76	1.79	$ 46.71
ASU 2020-06 \| Cumulative effect of adoption of accounting standard
Significant Accounting Policies
Current portion of convertible debt, net					$ 76,991
Other non-current liabilities					(17,028)
Retained earnings					$ (59,963)
Basic (in dollars per share)	0.12		0.34
Diluted (in dollars per share)	$ 0.12		$ 0.33

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

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+ Details

- Definition

The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

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+ Details

Discontinued Operations (Details) - Discontinued operations - USD ($) $ / shares in Units, $ in Thousands		3 Months Ended	9 Months Ended
	Jul. 26, 2021	Oct. 02, 2021	Oct. 01, 2022	Oct. 02, 2021
Transition Services Agreement
Continuing Involvement
TSA fees			$ 4,800
Infrastructure and automotive business
Discontinued Operations
Asset Purchase Agreement sale amount	$ 2,750,000
Financial results of the infrastructure and automotive business
Revenues		$ 28,203		$ 233,915
Costs of revenues		11,891		95,800
Operating expenses		(496)		46,512
Operating income from discontinued operations		16,808		91,603
Gain on sale of discontinued operations		2,423,161		2,423,161
Income from discontinued operations before income taxes		2,439,969		2,514,764
Provision for income taxes		333,173		330,880
Income from discontinued operations		$ 2,106,796		$ 2,183,884
Income from discontinued operations per share:
Basic		$ 48.56		$ 49.52
Diluted		$ 47.20		$ 48.11
Infrastructure and automotive business \| Transition Services Agreement \| Minimum
Continuing Involvement
Term of continuing involvement	3 months
Infrastructure and automotive business \| Transition Services Agreement \| Maximum
Continuing Involvement
Term of continuing involvement	18 months

Earnings (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 01, 2022	Oct. 02, 2021	Oct. 01, 2022	Oct. 02, 2021
Earnings (Loss) Per Share
Income (loss) from continuing operations	$ 20,999	$ (19,740)	$ 66,041	$ (63,387)
Shares used in computing basic earnings (loss) per share	34,079	43,385	35,935	44,103
Effect of dilutive securities:
Stock-based awards and convertible debt	700		1,033
Shares used in computing diluted earnings (loss) per share	34,779	43,385	36,968	44,103
Basic	$ 0.62	$ (0.45)	$ 1.84	$ (1.44)
Diluted	$ 0.60	$ (0.45)	$ 1.79	$ (1.44)
Income (loss) per share:
Shares excluded from calculation of diluted shares due to loss from continuing operations		1,200		1,300
Shares attributable to dilutive effect of conversion of debt securities	400	700	700	800

Fair Value of Financial Instruments - Summary of financial instruments (Details) - USD ($) $ in Thousands	Oct. 01, 2022	Jan. 01, 2022
Financial assets and liabilities measured at fair value on a recurring basis
Short-term investments	$ 893,131	$ 964,582
Recurring
Financial assets and liabilities measured at fair value on a recurring basis
Cash equivalents	341,858	852,242
Short-term investments	893,131	964,582
Other assets, net		4,980
Total	1,234,989	1,821,804
Recurring \| Money market funds
Financial assets and liabilities measured at fair value on a recurring basis
Cash equivalents	301,640	845,740
Recurring \| Government debt securities
Financial assets and liabilities measured at fair value on a recurring basis
Cash equivalents	12,988	2,950
Short-term investments	306,611	191,121
Recurring \| Corporate debt securities
Financial assets and liabilities measured at fair value on a recurring basis
Cash equivalents	27,230	3,552
Short-term investments	586,520	773,461
Recurring \| Auction rate securities
Financial assets and liabilities measured at fair value on a recurring basis
Other assets, net		4,980
Recurring \| Quoted Prices in Active Markets for Identical Assets (Level 1)
Financial assets and liabilities measured at fair value on a recurring basis
Cash equivalents	314,628	845,740
Short-term investments	207,560	71,509
Total	522,188	917,249
Recurring \| Quoted Prices in Active Markets for Identical Assets (Level 1) \| Money market funds
Financial assets and liabilities measured at fair value on a recurring basis
Cash equivalents	301,640	845,740
Recurring \| Quoted Prices in Active Markets for Identical Assets (Level 1) \| Government debt securities
Financial assets and liabilities measured at fair value on a recurring basis
Cash equivalents	12,988
Short-term investments	207,560	71,509
Recurring \| Significant Other Observable Inputs (Level 2)
Financial assets and liabilities measured at fair value on a recurring basis
Cash equivalents	27,230	6,502
Short-term investments	685,571	893,073
Total	712,801	899,575
Recurring \| Significant Other Observable Inputs (Level 2) \| Government debt securities
Financial assets and liabilities measured at fair value on a recurring basis
Cash equivalents		2,950
Short-term investments	99,051	119,612
Recurring \| Significant Other Observable Inputs (Level 2) \| Corporate debt securities
Financial assets and liabilities measured at fair value on a recurring basis
Cash equivalents	27,230	3,552
Short-term investments	$ 586,520	773,461
Recurring \| Significant Unobservable Inputs (Level 3)
Financial assets and liabilities measured at fair value on a recurring basis
Other assets, net		4,980
Total		4,980
Recurring \| Significant Unobservable Inputs (Level 3) \| Auction rate securities
Financial assets and liabilities measured at fair value on a recurring basis
Other assets, net		$ 4,980

Fair Value of Financial Instruments - Contractual maturities of investments (Details) $ in Thousands	Oct. 01, 2022 USD ($)
Cost
Due in one year or less, Cost	$ 611,264
Due after one year through ten years, Cost	315,952
Due after ten years, Cost	24,780
Total Cost	951,996
Fair Value
Due in one year or less, Fair Value	601,513
Due after one year through ten years, Fair Value	307,056
Due after ten years, Fair Value	24,780
Total Fair Value	$ 933,349

Fair Value of Financial Instruments - Available-for-sale investments (Details) - USD ($) $ in Thousands	Oct. 01, 2022	Jan. 01, 2022
Continuous unrealized loss position, Fair Value
Fair value of available-for-sale securities, continuous loss position for less than twelve months	$ 696,150	$ 545,874
Fair value of available-for-sale securities, continuous loss position for twelve months or greater	159,894	5,306
Total fair value of available-for-sale securities, continuous loss position	856,044	551,180
Continuous unrealized loss position, Gross Unrealized Losses
Available-for-sale securities, continuous loss position for less than 12 months, gross unrealized losses	(13,404)	(2,201)
Available-for-sale securities, continuous loss position for 12 months or greater, gross unrealized losses	(5,246)	(1,021)
Available-for-sale securities, total gross unrealized losses	(18,650)	(3,222)
Government debt securities
Continuous unrealized loss position, Fair Value
Fair value of available-for-sale securities, continuous loss position for less than twelve months	225,388	126,957
Fair value of available-for-sale securities, continuous loss position for twelve months or greater	55,508
Total fair value of available-for-sale securities, continuous loss position	280,896	126,957
Continuous unrealized loss position, Gross Unrealized Losses
Available-for-sale securities, continuous loss position for less than 12 months, gross unrealized losses	(3,880)	(750)
Available-for-sale securities, continuous loss position for 12 months or greater, gross unrealized losses	(2,599)
Available-for-sale securities, total gross unrealized losses	(6,479)	(750)
Corporate debt securities
Continuous unrealized loss position, Fair Value
Fair value of available-for-sale securities, continuous loss position for less than twelve months	470,762	418,917
Fair value of available-for-sale securities, continuous loss position for twelve months or greater	104,386	326
Total fair value of available-for-sale securities, continuous loss position	575,148	419,243
Continuous unrealized loss position, Gross Unrealized Losses
Available-for-sale securities, continuous loss position for less than 12 months, gross unrealized losses	(9,524)	(1,451)
Available-for-sale securities, continuous loss position for 12 months or greater, gross unrealized losses	(2,647)	(1)
Available-for-sale securities, total gross unrealized losses	$ (12,171)	(1,452)
Auction rate securities
Continuous unrealized loss position, Fair Value
Fair value of available-for-sale securities, continuous loss position for twelve months or greater		4,980
Total fair value of available-for-sale securities, continuous loss position		4,980
Continuous unrealized loss position, Gross Unrealized Losses
Available-for-sale securities, continuous loss position for 12 months or greater, gross unrealized losses		(1,020)
Available-for-sale securities, total gross unrealized losses		$ (1,020)

Fair Value of Financial Instruments - Activity in Level 3 financial instruments (Details) - Significant Unobservable Inputs (Level 3) - Recurring - Auction rate securities - USD ($) $ in Thousands		3 Months Ended	9 Months Ended
	May 31, 2022	Oct. 01, 2022	Oct. 01, 2022
Fair value assets reconciliation of changes
Beginning balance			$ 4,980
Sales	$ (5,700)		(6,000)
Loss recognized in earnings			$ 300
Loss recognized in earnings, Statements of Income location		Interest income and other, net	Interest income and other, net
Gain included in other comprehensive loss			$ 720
Gain included in other comprehensive loss, Statements of Comprehensive Income location		Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, before Tax	Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, before Tax
Ending balance		$ 0	$ 0

Fair Value of Financial Instruments - Fair values of other financial instruments (Details) - USD ($) $ in Millions	Oct. 01, 2022	Jan. 01, 2022
Convertible Senior Notes
Fair values of other financial instruments
Fair value of debt	$ 636.2	$ 944.3

Derivative Financial Instruments (Details) - Cash flow hedges - Foreign currency forward contracts $ in Millions	9 Months Ended
	Oct. 01, 2022 USD ($)
Derivative Financial Instruments
Derivative, notional amount	$ 16.3
Minimum
Derivative Financial Instruments
Maturity of contracts	1 month
Maximum
Derivative Financial Instruments
Maturity of contracts	3 months

Supplemental Information (Details) - USD ($) $ in Thousands	9 Months Ended
Supplemental Information (Details) - USD ($) $ in Thousands	Oct. 01, 2022	Oct. 02, 2021	Jan. 01, 2022
Inventories
Work in progress	$ 65,161		$ 36,078
Finished goods	23,286		13,229
Inventories	88,447		$ 49,307
Lease income
Lease income	$ 5,400	$ 3,100
Lease income, Statements of Income location	Selling, general and administrative	Selling, general and administrative

Debt - Convertible Senior Notes (Details) - 0.625% Convertible Senior Notes (2025 Notes) $ / shares in Units, $ in Millions	Jun. 01, 2020 USD ($) D $ / shares
Debt
Principal amount \| $	$ 535.0
Semi-annual interest rate	0.625%
Conversion rate, shares per $1,000 principal	8.1980
Conversion, number of shares of common stock \| $	4.4
Initial conversion price \| $ / shares	$ 121.98
Debt issuance costs \| $	$ 10.4
Conversion of Notes, Holders
Debt
Number of trading days within 30 trading day period	20
Number of consecutive trading days	30
Stock price trigger per share \| $ / shares	$ 159.51
Stock price trigger, as a percentage of conversion price	130.00%
Number of consecutive business days after the 10 consecutive trading day period	5
Number of consecutive trading days before the five consecutive business days	10
Maximum threshold stock price, as a percentage of conversion price	98.00%
Conversion of Notes, Company
Debt
Number of trading days within 30 trading day period	20
Number of consecutive trading days	30
Stock price trigger, as a percentage of conversion price	130.00%

Debt - Convertible Debt, Net (Details) - 0.625% Convertible Senior Notes (2025 Notes) - USD ($) $ in Thousands	Oct. 01, 2022	Jan. 01, 2022
Equity component
Effective interest rate	5.336%
Amortization period of debt discount and debt issuance costs	2 years 8 months 12 days
Convertible Senior Notes
Liability component
Principal	$ 534,980	$ 535,000
Unamortized debt discount		(78,519)
Unamortized debt issuance costs	(5,918)	(5,882)
Net carrying amount	$ 529,062	450,599
Equity component
Net carrying amount		$ 107,928

Debt - Interest expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Debt - Interest expense (Details) - USD ($) $ in Thousands	Oct. 01, 2022	Oct. 02, 2021	Oct. 01, 2022	Oct. 02, 2021
Interest expense related to the notes
Interest Expense, Total	$ 1,527	$ 6,595	$ 4,874	$ 24,405
Convertible Senior Notes
Interest expense related to the notes
Contractual interest expense	826	836	2,511	2,835
Amortization of debt discount		5,076		16,005
Amortization of debt issuance costs	498	380	1,492	1,273
Interest Expense, Total	$ 1,324	$ 6,292	$ 4,003	$ 20,113

Debt - Credit Facility (Details) $ in Millions	9 Months Ended
Debt - Credit Facility (Details) $ in Millions	Oct. 01, 2022 USD ($)
Credit Facility
Debt
Amount outstanding	$ 0
Credit Facility \| Scenario: Company's option to increase borrowing capacity
Debt
Additional increase in borrowing capacity of the line of credit available at the entity's option	$ 250
Additional increase in borrowing capacity based on EBITDA (as a percent)	100.00%
Maximum secured leverage ratio	3.25
Credit Facility \| Scenario: Credit facility debt covenants
Debt
Maximum net leverage ratio	4.25
Maximum secured leverage ratio	3.50
Minimum interest coverage ratio	2.50
Revolving Credit Facility
Debt
Maximum borrowing capacity	$ 400
Revolving credit facility, other than swingline loans \| Federal Funds
Debt
Interest rate margin (as a percent)	0.50%
Revolving credit facility, other than swingline loans \| Eurodollar Rate
Debt
Interest rate margin (as a percent)	1.00%
Revolving credit facility, other than swingline loans \| Eurodollar Rate \| Minimum
Debt
Interest rate margin (as a percent)	1.00%
Revolving credit facility, other than swingline loans \| Eurodollar Rate \| Maximum
Debt
Interest rate margin (as a percent)	1.75%
Revolving credit facility, other than swingline loans \| Base Rate \| Minimum
Debt
Interest rate margin (as a percent)	0.00%
Revolving credit facility, other than swingline loans \| Base Rate \| Maximum
Debt
Interest rate margin (as a percent)	0.75%
Letter of Credit
Debt
Maximum borrowing capacity	$ 25
Swingline Loans
Debt
Maximum borrowing capacity	$ 10

Commitments and Contingencies (Details)	Oct. 01, 2022 USD ($)
Commitments and Contingencies
Loss contingency accrual	$ 0

Revenues (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Revenues (Details) - USD ($) $ in Thousands	Oct. 01, 2022	Oct. 02, 2021	Oct. 01, 2022	Oct. 02, 2021
Revenues
Revenues	$ 269,817	$ 184,831	$ 766,781	$ 512,180
Revenue from performance obligations that were satisfied in previous reporting periods	4,500	10,000	30,700	10,900
Distributors
Revenues
Revenues	217,355	148,773	621,563	414,692
Direct customers
Revenues
Revenues	52,462	36,058	145,218	97,488
Industrial and Commercial
Revenues
Revenues	145,661	93,339	416,475	261,475
Home and Life
Revenues
Revenues	$ 124,156	$ 91,492	$ 350,306	$ 250,705

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

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-URI https://asc.fasb.org/extlink&oid=6472922&loc=d3e499488-122856

+ Details

Stock-Based Compensation (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Stock-Based Compensation (Details) - USD ($) $ in Thousands	Oct. 01, 2022	Oct. 02, 2021	Oct. 01, 2022	Oct. 02, 2021
Stock-based compensation costs
Stock based compensation costs	$ 15,950	$ 14,296	$ 43,213	$ 36,916
Income tax (provision) benefit	1,230	(627)	4,444	632
Share based compensation costs after tax	14,720	10,808	38,769	35,278
Total unrecognized compensation costs related to awards	123,400		$ 123,400
Weighted-average period of recognition of unrecognized compensation costs			2 years 3 months 18 days
Continuing operations
Stock-based compensation costs
Share based compensation costs after tax	14,720	14,923	$ 38,769	36,284
Discontinued operations
Stock-based compensation costs
Share based compensation costs after tax		(4,115)		(1,006)
Cost of revenues
Stock-based compensation costs
Stock based compensation costs	288	261	834	696
Research and development
Stock-based compensation costs
Stock based compensation costs	8,788	7,071	23,482	18,190
Selling, general and administrative
Stock-based compensation costs
Stock based compensation costs	$ 6,874	$ 6,964	$ 18,897	$ 18,030

Income Taxes (Details) $ in Thousands, kr in Millions	3 Months Ended		9 Months Ended
Income Taxes (Details) $ in Thousands, kr in Millions	Oct. 01, 2022 USD ($)	Oct. 02, 2021 USD ($)	Oct. 01, 2022 USD ($)	Oct. 01, 2022 NOK (kr)	Oct. 02, 2021 USD ($)
Income Taxes
Income tax expense (benefit)	$ 14,188	$ 9,386	$ 36,871		$ 12,543
Effective income tax rate (as a percent)	40.30%	(90.70%)	35.80%	35.80%	(24.70%)
Gross unrecognized tax benefits which would affect the effective tax rate if recognized	$ 4,600		$ 4,600
Reasonably possible amount of decrease in gross unrecognized tax benefits over the next 12 months	$ (500)		(500)
Norwegian Tax Administration \| 2013 \| Under appeal
Income Taxes
Estimate of additional income tax expense			$ 13,100	kr 141.3

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

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