GlobeNewswire Inc | Jul 29, 2020 04:01PM EDT

July 29, 2020

GREENSBORO, N.C., July 29, 2020 (GLOBE NEWSWIRE) -- Qorvo (Nasdaq:QRVO), a leading provider of innovative RF solutions that connect the world, today announced financial results for the Companys fiscal 2021 first quarter, ended June27, 2020.

On a GAAP basis, revenue for Qorvos fiscal 2021 first quarter was $787 million, gross margin was 41.4%, operating income was $93 million and diluted earnings per share was $0.83. On a non-GAAP basis, gross margin was 48.6%, operating income was $204 million and diluted earnings per share was $1.50.

Bob Bruggeworth, president and chief executive officer of Qorvo, said, Qorvo delivered an exceptional June quarter, with revenue and EPS well above guidance. The Qorvo team continues to operate very well in a challenging environment. We are supporting leading customers with best-in-class products, and our technology investments are aligned with long-term market drivers in 5G handsets and infrastructure, defense, Wi-Fi 6 and IoT.

Strategic Highlights

-- Achieved record infrastructure revenue supporting 5G base station deployments and sampled GaN power amplifiers for upcoming U.S. C-band spectrum allocations -- Ramped programmable power management solution and Wi-Fi 6 FEM for a leading drone manufacturer, enabling longer flight time, greater range and larger payload -- Awarded design wins for integrated GaN multi-chip broadband Tx/Rx module and 50-watt GaN power amplifier for defense radar programs -- Experienced continued strong demand for Wi-Fi 6 products, including FEMs and BAW filters, driven by work-from-home trends -- Commenced shipments of integrated ultra-low power, multi-protocol Zigbee, BLE and Thread IoT solution supporting one of the largest providers of smart home infrastructure solutions -- Requested an emergency use authorization (EUA) from the FDA for COVID-19 antibody testing using Qorvo Biotechnologies platform featuring a unique sensor technology -- Ramped innovative antennaplexer solution addressing antenna network complexity and optimizing system efficiency for upcoming foldable smartphone -- Captured complete main path (highly integrated low-band, mid-/high-band and ultra-high-band modules) at leading Android smartphone manufacturers for upcoming 5G product launches -- Commenced high volume UWB shipments enabling superior accuracy and reliability in spatial awareness applications, including contact tracing/social distancing, for numerous customers globally -- Increased mobile power management shipments, driven by adoption of 4G/5G dual transmit

Financial Commentary and Outlook

Mark Murphy, chief financial officer of Qorvo, said, The rollout of 5G and Qorvos operational performance helped drive a June quarter well above our expectations. During the September quarter, we expect robust end market demand and ongoing operational improvements to drive healthy revenue growth, gross margin expansion to approximately 50%, and continued strong free cash flow.

Qorvo currently believes the demand environment in its end markets supports the following expectations for the September 2020 quarter:

-- Quarterly revenue in the range of $925 million to $955 million -- Non-GAAP gross margin of approximately 50% -- Non-GAAP diluted earnings per share of $1.90 at the midpoint of guidance -- Note: fiscal year 2021 is a 53-week fiscal year, and the September quarter is a 14-week fiscal quarter

Qorvos actual quarterly results may differ from these expectations and projections, and such differences may be material.

Selected Financial Information

The following tables set forth selected GAAP and non-GAAP financial information for Qorvo for the periods indicated. See the more detailed financial information for Qorvo, including reconciliations of GAAP and non-GAAP financial information, attached.



SELECTED GAAP RESULTS (Unaudited) (In millions, except for percentages and EPS) For the quarter For the quarter Change vs. ended June 27, ended March 28, Q4 FY 2020 2020 2020Revenue $ 787.5 $ 787.8 $ (0.3 ) Gross profit $ 325.8 $ 335.8 $ (10.0 ) Gross margin 41.4 % 42.6 % (1.2 ) pptOperating expenses $ 233.1 $ 233.6 $ (0.5 ) Operating income $ 92.7 $ 102.2 $ (9.5 ) Net income $ 96.9 $ 50.4 $ 46.5 Weighted average 116.8 117.8 (1.0 ) diluted sharesDiluted EPS $ 0.83 $ 0.43 $ 0.40



SELECTED NON-GAAP RESULTS^1 (Unaudited) (In millions, except for percentages and EPS) For the quarter For the quarter Change vs. ended June 27, ended March 28, Q4 FY 2020 2020 2020Gross profit $ 382.5 $ 390.9 $ (8.4 ) Gross margin 48.6 % 49.6 % (1.0 ) pptOperating expenses $ 178.7 $ 181.0 $ (2.3 ) Operating income $ 203.7 $ 209.9 $ (6.2 ) Net income $ 175.1 $ 185.3 $ (10.2 ) Weighted average 116.8 117.8 (1.0 ) diluted sharesDiluted EPS $ 1.50 $ 1.57 $ (0.07 )



SELECTED GAAP RESULTS (Unaudited) (In millions, except for percentages and EPS) For the quarter For the quarter Change vs. ended June 27, ended June 29, Q1 FY 2020 2020 2019Revenue $ 787.5 $ 775.6 $ 11.9 Gross profit $ 325.8 $ 294.3 $ 31.5 Gross margin 41.4 % 37.9 % 3.5 pptOperating expenses $ 233.1 $ 239.1 $ (6.0 ) Operating income $ 92.7 $ 55.2 $ 37.5 Net income $ 96.9 $ 39.5 $ 57.4 Weighted average 116.8 121.1 (4.3 ) diluted sharesDiluted EPS $ 0.83 $ 0.33 $ 0.50



SELECTED NON-GAAP RESULTS^1 (Unaudited) (In millions, except for percentages and EPS) For the quarter For the quarter Change vs. ended June 27, ended June 29, Q1 FY 2020 2020 2019Gross profit $ 382.5 $ 358.0 $ 24.5 Gross margin 48.6 % 46.2 % 2.4 pptOperating expenses $ 178.7 $ 167.9 $ 10.8 Operating income $ 203.7 $ 190.1 $ 13.6 Net income $ 175.1 $ 165.3 $ 9.8 Weighted average 116.8 121.1 (4.3 ) diluted sharesDiluted EPS $ 1.50 $ 1.36 $ 0.14

1Excludes stock-based compensation expense, amortization of intangible assets, restructuring related charges, acquisition and integration related costs, accelerated depreciation, loss (gain) on assets, start-up costs, gain (loss) on investments, other (income) expense and an adjustment of income taxes.

Non-GAAP Financial Measures

In addition to disclosing financial results calculated in accordance with United States (U.S.) generally accepted accounting principles (GAAP), this earnings release contains some or all of the following non-GAAP financial measures: (i) non-GAAP revenue, (ii) non-GAAP gross profit and gross margin, (iii) non-GAAP operating income and operating margin, (iv) non-GAAP net income, (v) non-GAAP net income per diluted share, (vi) non-GAAP operating expenses (research and development; selling, general and administrative), (vii) free cash flow, (viii) EBITDA, (ix) non-GAAP return on invested capital (ROIC), and (x) net debt or positive net cash. Each of these non-GAAP financial measures is either adjusted from GAAP results to exclude certain expenses or derived from multiple GAAP measures, which are outlined in the Reconciliation of GAAP to Non-GAAP Financial Measures tables, attached, and the Additional Selected Non-GAAP Financial Measures and Reconciliations tables, attached.

In managing Qorvo's business on a consolidated basis, management develops an annual operating plan, which is approved by our Board of Directors, using non-GAAP financial measures. In developing and monitoring performance against this plan, management considers the actual or potential impacts on these non-GAAP financial measures from actions taken to reduce costs with the goal of increasing gross margin and operating margin. In addition, management relies upon these non-GAAP financial measures to assess whether research and development efforts are at an appropriate level, and when making decisions about product spending, administrative budgets, and other operating expenses. Also, we believe that non-GAAP financial measures provide useful supplemental information to investors and enable investors to analyze the results of operations in the same way as management. We have chosen to provide this supplemental information to enable investors to perform additional comparisons of our operating results, to assess our liquidity and capital position and to analyze financial performance excluding the effect of expenses unrelated to operations, certain non-cash expenses and stock-based compensation expense, which may obscure trends in Qorvo's underlying performance.

We believe that these non-GAAP financial measures offer an additional view of Qorvo's operations that, when coupled with the GAAP results and the reconciliations to corresponding GAAP financial measures, provide a more complete understanding of Qorvo's results of operations and the factors and trends affecting Qorvo's business. However, these non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, the corresponding measures calculated in accordance with GAAP.

Our rationale for using these non-GAAP financial measures, as well as their impact on the presentation of Qorvo's operations, are outlined below:

Non-GAAP gross profit and gross margin. Non-GAAP gross profit and gross margin exclude stock-based compensation expense, amortization of intangible assets, accelerated depreciation, restructuring related charges and certain non-cash expenses. We believe that exclusion of these costs in presenting non-GAAP gross profit and gross margin gives management and investors a more effective means of evaluating Qorvo's historical performance and projected costs and the potential for realizing cost efficiencies. We believe that the majority of Qorvo's purchased intangibles are not relevant to analyzing current operations because they generally represent costs incurred by the acquired company to build value prior to acquisition, and thus are effectively part of transaction costs rather than ongoing costs of operating Qorvo's business. In this regard, we note that (i) once the intangibles are fully amortized, the intangibles will not be replaced with cash costs and therefore, the exclusion of these costs provides management and investors with better visibility into the actual costs required to generate revenues over time, and (ii) although we set the amortization expense based on useful life of the various assets at the time of the transaction, we cannot influence the timing and amount of the future amortization expense recognition once the lives are established. Similarly, we believe that presentation of non-GAAP gross profit and gross margin and other non-GAAP financial measures that exclude the impact of stock-based compensation expense assists management and investors in evaluating the period-over-period performance of Qorvo's ongoing operations because (i) the expenses are non-cash in nature, and (ii) although the size of the grants is within our control, the amount of expense varies depending on factors such as short-term fluctuations in stock price volatility and prevailing interest rates, which can be unrelated to the operational performance of Qorvo during the period in which the expense is incurred and generally are outside the control of management. Moreover, we believe that the exclusion of stock-based compensation expense in presenting non-GAAP gross profit and gross margin and other non-GAAP financial measures is useful to investors to understand the impact of the expensing of stock-based compensation to Qorvo's gross profit and gross margins and other financial measures in comparison to prior periods. We also believe that the adjustments to profit and margin related to accelerated depreciation, restructuring related charges and certain non-cash expenses do not constitute part of Qorvo's ongoing operations and therefore the exclusion of these items provides management and investors with better visibility into the actual revenue and actual costs required to generate revenues over time and gives management and investors a more effective means of evaluating our historical and projected performance. We believe disclosure of non-GAAP gross profit and gross margin has economic substance because the excluded expenses do not represent continuing cash expenditures and, as described above, we have little control over the timing and amount of the expenses in question.

Non-GAAP operating income and operating margin. Non-GAAP operating income and operating margin exclude stock-based compensation expense, amortization of intangible assets, restructuring related charges, acquisition and integration related costs, loss (gain) on assets, accelerated depreciation, start-up costs and certain non-cash expenses. We believe that presentation of a measure of operating income and operating margin that excludes amortization of intangible assets and stock-based compensation expense is useful to both management and investors for the same reasons as described above with respect to our use of non-GAAP gross profit and gross margin. We believe that restructuring related charges, acquisition and integration related costs, loss (gain) on assets, accelerated depreciation, start-up costs and certain non-cash expenses do not constitute part of Qorvo's ongoing operations and therefore, the exclusion of these costs provides management and investors with better visibility into the actual costs required to generate revenues over time and gives management and investors a more effective means of evaluating our historical and projected performance. We believe disclosure of non-GAAP operating income and operating margin has economic substance because the excluded expenses are either unrelated to ongoing operations or do not represent current cash expenditures.

Non-GAAP net income and non-GAAP net income per diluted share. Non-GAAP net income and non-GAAP net income per diluted share exclude the effects of stock-based compensation expense, amortization of intangible assets, restructuring related charges, acquisition and integration related costs, loss (gain) on assets, accelerated depreciation, start-up costs, certain non-cash expenses, (gain) loss on investments, other (income) expense and also reflect an adjustment of income taxes. The income tax adjustment primarily represents the use of research and development tax credit carryforwards, deferred tax expense (benefit) items not affecting taxes payable, adjustments related to the deemed and actual repatriation of historical foreign earnings, non-cash expense (benefit) related to uncertain tax positions and other items unrelated to the current fiscal year or that are not indicative of our ongoing business operations. We believe that presentation of measures of net income and net income per diluted share that exclude these items is useful to both management and investors for the reasons described above with respect to non-GAAP gross profit and gross margin and non-GAAP operating income and operating margin. We believe disclosure of non-GAAP net income and non-GAAP net income per diluted share has economic substance because the excluded expenses are either unrelated to ongoing operations or do not represent current cash expenditures.

Non-GAAP research and development and selling, general and administrative expenses. Non-GAAP research and development and selling, general and administrative expenses exclude stock-based compensation expense, amortization of intangible assets and certain non-cash expenses (primarily acquisition and integration related costs). We believe that presentation of measures of these operating expenses that exclude amortization of intangible assets and stock-based compensation expense is useful to both management and investors for the same reasons as described above with respect to our use of non-GAAP gross profit and gross margin. We believe that acquisition and integration related costs and certain non-cash expenses do not constitute part of Qorvo's ongoing operations and therefore, the exclusion of these costs provides management and investors with better visibility into the actual costs required to generate revenues over time and gives management and investors a more effective means of evaluating our historical and projected performance. We believe disclosure of these non-GAAP operating expenses has economic substance because the excluded expenses are either unrelated to ongoing operations or do not represent current cash expenditures.

Free cash flow. Qorvo defines free cash flow as net cash provided by operating activities during the period minus property and equipment expenditures made during the period. We use free cash flow as a supplemental financial measure in our evaluation of liquidity and financial strength. Management believes that this measure is useful as an indicator of our ability to service our debt, meet other payment obligations and make strategic investments. Free cash flow should be considered in addition to, rather than as a substitute for, net income as a measure of our performance and net cash provided by operating activities as a measure of our liquidity. Additionally, our definition of free cash flow is limited, in that it does not represent residual cash flows available for discretionary expenditures due to the fact that the measure does not deduct the payments required for debt service and other contractual obligations. Therefore, we believe it is important to view free cash flow as a measure that provides supplemental information to our entire statement of cash flows.

EBITDA. Qorvo defines EBITDA as earnings before interest expense and interest income, income tax expense (benefit), depreciation and intangible amortization. Management believes that this measure is useful to evaluate our ongoing operations and as a general indicator of our operating cash flow (in conjunction with a cash flow statement which also includes among other items, changes in working capital and the effect of non-cash charges).

Non-GAAP ROIC. Return on invested capital (ROIC) is a non-GAAP financial measure that management believes provides useful supplemental information for management and the investor by measuring the effectiveness of our operations' use of invested capital to generate profits. We use ROIC to track how much value we are creating for our shareholders. Non-GAAP ROIC is calculated by dividing annualized non-GAAP operating income, net of an adjustment for income taxes (as described above), by average invested capital. Average invested capital is calculated by subtracting the average of the beginning balance and the ending balance of current liabilities (excluding the current portion of long-term debt and other short-term financings) from the average of the beginning balance and the ending balance of net accounts receivable, inventories, other current assets, net property and equipment and a cash amount equal to seven days of quarterly revenue.

Net debt or positive net cash. Net debt or positive net cash is defined as unrestricted cash, cash equivalents and short-term investments minus any borrowings under our credit facility and the principal balance of our senior unsecured notes. Management believes that net debt or positive net cash provides useful information regarding the level of Qorvo's indebtedness by reflecting cash and investments that could be used to repay debt.

Forward-looking non-GAAP measures. Our earnings release contains forward-looking gross margin, income tax rate and diluted earnings per share. We provide these non-GAAP measures to investors on a prospective basis for the same reasons (set forth above) that we provide them to investors on a historical basis. We are unable to provide a reconciliation of the forward-looking non-GAAP financial measures to the most directly comparable forward-looking GAAP financial measures without unreasonable effort due to variability and difficulty in making accurate projections for items that would be required to be included in the GAAP measures, such as stock-based compensation, acquisition and integration related costs, restructuring related charges, asset impairments and the provision for income taxes. We believe such reconciliations would imply a degree of precision that would be confusing or misleading to investors.

Limitations of non-GAAP financial measures. The primary material limitations associated with the use of non-GAAP financial measures as an analytical tool compared to the most directly comparable GAAP financial measures are these non-GAAP financial measures (i) may not be comparable to similarly titled measures used by other companies in our industry, and (ii) exclude financial information that some may consider important in evaluating our performance, thus limiting their usefulness as a comparative tool. We compensate for these limitations by providing full disclosure of the differences between these non-GAAP financial measures and the corresponding GAAP financial measures, including a reconciliation of the non-GAAP financial measures to the corresponding GAAP financial measures, to enable investors to perform their own analysis of our gross profit and gross margin, operating expenses, operating income, net income, net income per diluted share and net cash provided by operating activities. We further compensate for the limitations of our use of non-GAAP financial measures by presenting the corresponding GAAP measures more prominently.

Qorvo will conduct a conference call at 5:00 p.m. ET today to discuss todays press release. The conference call will be broadcast live over the Internet and can be accessed by any interested party at http://www.qorvo.com (under Investors). A telephone playback of the conference call will be available approximately two hours after the calls completion and can be accessed by dialing 719-457-0820 and using the passcode 2952909. The playback will be available through the close of business August 5, 2020.

About Qorvo

Qorvo (Nasdaq:QRVO) makes a better world possible by providing innovative Radio Frequency (RF) solutions at the center of connectivity. We combine product and technology leadership, systems-level expertise and global manufacturing scale to quickly solve our customers most complex technical challenges. Qorvo serves diverse high-growth segments of large global markets, including advanced wireless devices, wired and wireless networks and defense radar and communications. We also leverage unique competitive strengths to advance 5G networks, cloud computing, the Internet of Things, and other emerging applications that expand the global framework interconnecting people, places and things. Visit www.qorvo.com to learn how Qorvo connects the world.

Qorvo is a registered trademark of Qorvo, Inc. in the U.S. and in other countries. All other trademarks are the property of their respective owners.

This press release includes "forward-looking statements" within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, statements about our plans, objectives, representations and contentions, and are not historical facts and typically are identified by use of terms such as "may," "will," "should," "could," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential," "continue" and similar words, although some forward-looking statements are expressed differently. You should be aware that the forward-looking statements included herein represent management's current judgment and expectations, but our actual results, events and performance could differ materially from those expressed or implied by forward-looking statements. We do not intend to update any of these forward-looking statements or publicly announce the results of any revisions to these forward-looking statements, other than as is required under U.S. federal securities laws. Our business is subject to numerous risks and uncertainties, including those relating to fluctuations in our operating results; our substantial dependence on developing new products and achieving design wins; our dependence on a few large customers for a substantial portion of our revenue; a loss of revenue if contracts with the United States government or defense and aerospace contractors are canceled or delayed or if defense spending is reduced; the COVID-19 outbreak, which has and will likely continue to negatively impact the global economy and disrupt normal business activities, and which may have an adverse effect on our results of operations; our dependence on third parties; risks related to sales through distributors; risks associated with the operation of our manufacturing facilities; business disruptions; poor manufacturing yields; increased inventory risks and costs due to timing of customer forecasts; our inability to effectively manage or maintain evolving relationships with platform providers; risks from international sales and operations; economic regulation in China; changes in government trade policies, including imposition of tariffs and export restrictions; our ability to implement innovative technologies; underutilization of manufacturing facilities as a result of industry overcapacity; we may not be able to borrow funds under our credit facility or secure future financing; we may not be able to generate sufficient cash to service all of our debt; restrictions imposed by the agreements governing our debt; volatility in the price of our common stock; damage to our reputation or brand; fluctuations in the amount and frequency of our stock repurchases; our recent and future acquisitions and other strategic investments could fail to achieve financial or strategic objectives; our ability to attract, retain and motivate key employees; our reliance on our intellectual property portfolio; claims of infringement of third-party intellectual property rights; security breaches and other similar disruptions compromising our information; theft, loss or misuse of personal data by or about our employees, customers or third parties; warranty claims, product recalls and product liability; and risks associated with environmental, health and safety regulations and climate change. Many of the foregoing risks and uncertainties are, and will continue to be, exacerbated by the COVID-19 outbreak and any worsening of the global business and economic environment as a result. These and other risks and uncertainties, which are described in more detail in Qorvo's most recent Annual Report on Form 10-K and in other reports and statements filed with the Securities and Exchange Commission, could cause actual results and developments to be materially different from those expressed or implied by any of these forward-looking statements.

Financial Tables to Follow

QORVO, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF INCOME(In thousands, except per share data)(Unaudited)

Three Months Ended June 27, 2020 June 29, 2019Revenue $ 787,451 $ 775,598 Costs and expenses: Cost of goods sold 461,662 481,309 Research and development 130,071 118,920 Selling, general and administrative 86,604 88,979 Other operating expense 16,402 31,164 Total costs and expenses 694,739 720,372 Operating income 92,712 55,226 Interest expense (18,849 ) (11,864 )Other income 23,137 1,835 Income before income taxes 97,000 45,197 Income tax expense (78 ) (5,656 )Net income $ 96,922 $ 39,541 Net income per share, diluted $ 0.83 $ 0.33 Weighted average outstanding diluted shares 116,751 121,123

QORVO, INC. AND SUBSIDIARIESRECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES(In thousands, except per share data)(Unaudited)

Three Months Ended June 27, March 28, June 29, 2020 2020 2019 GAAP operating income $ 92,712 $ 102,154 $ 55,226 Stock-based compensation expense 21,859 13,768 24,953 Amortization of intangible assets 71,944 69,183 58,182 Restructuring related charges 938 3,958 8,031 Acquisition and integration related 12,663 23,986 23,130 costsAccelerated depreciation ? 221 15,938 Loss (gain) on assets, start-up costs 3,622 (3,326 ) 4,599 and other non-cash expensesNon-GAAP operating income $ 203,738 $ 209,944 $ 190,059 GAAP net income $ 96,922 $ 50,390 $ 39,541 Stock-based compensation expense 21,859 13,768 24,953 Amortization of intangible assets 71,944 69,183 58,182 Restructuring related charges 938 3,958 8,031 Acquisition and integration related 12,663 23,986 23,130 costsAccelerated depreciation ? 221 15,938 Loss (gain) on assets, start-up costs 3,622 (3,326 ) 4,599 and other non-cash expenses(Gain) loss on investments (14,617 ) 18,789 (661 )Other (income) expense (3,039 ) 3,765 661 Adjustment of income taxes (15,212 ) 4,607 (9,105 ) Non-GAAP net income $ 175,080 $ 185,341 $ 165,269 GAAP weighted average outstanding 116,751 117,757 121,123 diluted sharesDilutive stock-based awards ? ? ? Non-GAAP weighted average outstanding 116,751 117,757 121,123 diluted shares Non-GAAP net income per share, diluted $ 1.50 $ 1.57 $ 1.36

QORVO, INC. AND SUBSIDIARIESRECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES(Unaudited)

Three Months Ended(in thousands, except June 27, 2020 March 28, 2020 June 29, 2019percentages)GAAP gross profit/margin $ 325,789 41.4 % $ 335,781 42.6 % $ 294,289 37.9 %Amortization of intangible 51,945 6.6 % 49,866 6.3 % 40,763 5.3 %assetsRestructuring related ? ? % 2,058 0.3 % 1,836 0.2 %chargesStock-based compensation 4,616 0.6 % 2,571 0.3 % 3,041 0.4 %expenseAccelerated depreciation ? ? % 221 ? % 15,938 2.1 %Other non-cash expenses 125 ? % 408 0.1 % 2,089 0.3 %Non-GAAP gross profit/ $ 382,475 48.6 % $ 390,905 49.6 % $ 357,956 46.2 %margin

Three Months EndedNon-GAAP Operating Income June 27, 2020(as a percentage of sales) GAAP operating income 11.8 %Stock-based compensation expense 2.8 %Amortization of intangible assets 9.1 %Restructuring related charges 0.1 %Acquisition and integration related costs 1.6 %Loss on assets, start-up costs and other non-cash expenses 0.5 %Non-GAAP operating income 25.9 %

Three Months EndedFree Cash Flow (1) June 27, 2020(in millions) Net cash provided by operating activities $ 214.3 Purchases of property and equipment (29.9 )Free cash flow $ 184.4

(1) Free Cash Flow is calculated as net cash provided by operating activities minus property and equipment expenditures.

QORVO, INC. AND SUBSIDIARIESADDITIONAL SELECTED NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS(In thousands)(Unaudited)

Three Months Ended June 27, March 28, June 29, 2020 2020 2019GAAP research and development $ 130,071 $ 127,029 $ 118,920 expenseLess: Stock-based compensation expense 6,964 6,242 6,063 Other non-cash expenses 526 482 487 Non-GAAP research and development $ 122,581 $ 120,305 $ 112,370 expense Three Months Ended June 27, March 28, June 29, 2020 2020 2019GAAP selling, general and $ 86,604 $ 85,111 $ 88,979 administrative expenseLess: Stock-based compensation expense 10,277 4,955 15,849 Amortization of intangible assets 19,999 19,318 17,419 Other non-cash expenses 173 182 185 Non-GAAP selling, general and $ 56,155 $ 60,656 $ 55,526 administrative expense

QORVO, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE SHEETS(In thousands)(Unaudited)

June 27, 2020 March 28, 2020ASSETS Current assets: Cash and cash equivalents $ 1,136,302 $ 714,939 Accounts receivable, net 325,993 367,172 Inventories 523,690 517,198 Other current assets 93,344 91,193 Total current assets 2,079,329 1,690,502 Property and equipment, net 1,235,676 1,259,203 Goodwill 2,615,178 2,614,274 Intangible assets, net 738,346 808,892 Long-term investments 36,921 22,515 Other non-current assets 177,236 165,296 Total assets $ 6,882,686 $ 6,560,682 LIABILITIES AND STOCKHOLDERS? EQUITY Current liabilities: Accounts payable and accrued liabilities $ 418,258 $ 464,755 Other current liabilities 91,074 74,248 Total current liabilities 509,332 539,003 Long-term debt 1,869,502 1,567,231 Other long-term liabilities 152,607 161,783 Total liabilities 2,531,441 2,268,017 Stockholders? equity 4,351,245 4,292,665 Total liabilities and stockholders? equity $ 6,882,686 $ 6,560,682

At QorvoDoug DeLietoVP, Investor Relations1.336.678.7968