01—Abstract
Summary
Summary of the 10-K/A filed January 27, 2023. Cited figures are marked; the original filing is the authoritative source.
This Part III section of Skyworks Solutions, Inc.'s annual report on Form 10-K for the fiscal year ended September 30, 2022 covers directors, executive officers, executive and director compensation, security ownership, related-party transactions, and auditor fees.
Liam K. Griffin serves as Chairman, Chief Executive Officer and President, and Christine King is Lead Independent Director. The filing reports that Mr. Griffin's total fiscal 2022 compensation was $16,667,162,a roughly 552 times the $30,180 annual total compensation of the company's median employee.
The Board determined that seven of its eight members are independent. Compensation outcomes tied to fiscal 2022 performance were mixed. The first-half short-term incentive award paid at 200% of target, based on revenue of $2,846 millionb and non-GAAP operating income of $1,077 million.
The second half reached $2,640 millionc of revenue and $968 million of non-GAAP operating income, which produced an award at 68% of target. Emerging revenue growth of 59% exceeded the maximum performance level and resulted in 200% of target shares for that metric. The FY20 performance share awards tied to three-year total shareholder return were cancelled after the company ranked at the 23rd percentile against its peer group.
The Compensation Committee retained its prior approach and did not exercise discretion over incentive payouts. Stockholder engagement was substantial. About 86%d of votes cast at the 2022 Annual Meeting approved the say-on-pay proposal.
Following that meeting, the company contacted about 20 institutional stockholders representing approximately 41% of shares outstanding. The filing also reports 158,974,105 shares outstanding as of January 20, 2023, with The Vanguard Group at 11.28% and BlackRock at 9.0%. KPMG LLP's total fees were $2,518,078 for fiscal 2022, compared with $2,866,000 for fiscal 2021.
02—Key points
Key Highlights
- Fiscal 2022 first-half short-term incentive paid at 200% of target on revenue of $2,846 million and non-GAAP operating income of $1,077 million; second-half award was 68% of target on revenue of $2,640 million and non-GAAP operating income of $968 million.
- CEO Liam K. Griffin's total fiscal 2022 compensation was $16,667,162, with the filing estimating his pay at about 552 times that of the median employee ($30,180).
- Emerging revenue growth of 59% in fiscal 2022 exceeded the maximum performance level, yielding 200% of target shares for that metric.
- FY20 performance share awards were cancelled because three-year TSR ranked at the 23rd percentile, below the threshold.
- Approximately 86% of votes cast at the 2022 Annual Meeting approved the say-on-pay proposal; management reached out to about 20 institutional holders representing roughly 41% of shares.
- Board: seven of eight directors are independent; Christine King serves as Lead Independent Director and Chairman of the Compensation Committee.
- KPMG LLP fees totaled $2,518,078 in fiscal 2022 versus $2,866,000 in fiscal 2021, with audit fees at 98.5% of the fiscal 2022 total.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2022, Skyworks Solutions kept $0.23.
- Revenue$5.49B100.0%
- Cost of revenue−$2.88B52.5%
- Gross profit$2.60B47.5%
- Operating costs−$1.08B19.6%
- Operating income$1.53B27.8%
- Interest, other & tax−$251.8M4.6%
- Net income$1.28B23.2%
Where FY2022 revenue went
$5.49B- Cost of revenue: $2.88B, 53% of revenue
- Net income: $1.28B, 23% of revenue
- R&D: $617.9M, 11% of revenue
- SG&A: $329.8M, 6.0% of revenue
- Other operating costs: $129.6M, 2.4% of revenue
- Interest, other & tax: $251.8M, 4.6% of revenue
Kept 23% as net incomeOther operating costs $129.6M · 2.4%
Full revenue history →04—Financials
Financial Highlights
Figures from 10-K/AFY2022filed January 27, 2023Financial Statements
FY2022 against FY2021
| Line item | FY2022FY2021 | Change |
|---|---|---|
| Revenue | $5.49B$5.11B | +7.4% |
| Cost of Revenue | $2.88B$2.60B | +11.0% |
| Gross Profit | $2.60B$2.51B | +3.7% |
| R&D Expenses | $617.90M$532.30M | +16.1% |
| SG&A Expenses | $329.80M$322.50M | +2.3% |
| Operating Expenses | $1.08B$899.70M | +19.7% |
| Operating Income | $1.53B$1.61B | −5.3% |
| Interest Expense | $47.90M-$13.40M | +457.5% |
| Net Income | $1.28B$1.50B | −14.9% |
| EPS (Basic) | $7.85$9.07 | −13.5% |
| EPS (Diluted) | $7.81$8.97 | −12.9% |
| Shares Outstanding (Basic) | 162.40M165.20M | −1.7% |
| Shares Outstanding (Diluted) | 163.30M167.00M | −2.2% |
05—Questions
Frequently Asked Questions
How did fiscal 2022 performance affect executive bonuses?
Bonuses were split across two six-month periods. The first half paid at 200% of target after revenue of $2,846 million and non-GAAP operating income of $1,077 million were achieved. The second half paid at 68% of target after revenue of $2,640 million and non-GAAP operating income of $968 million were achieved. The Compensation Committee did not use discretion to adjust either payout.
What was the CEO's pay in fiscal 2022?
Liam K. Griffin's total fiscal 2022 compensation in the Summary Compensation Table was $16,667,162, including $13,087,793 in stock awards and $2,423,906 in non-equity incentive plan compensation. Base salary was $1,130,000 as of the fiscal year-end base salary adjustments.
Did long-term equity awards pay out?
Mixed results. Emerging revenue growth awards paid at 200% of target because growth of 59% exceeded the maximum. The FY20 TSR-based awards were cancelled because the company's three-year TSR ranked at the 23rd percentile, below the threshold. Some FY21 and FY22 awards remain in performance periods, with the FY21 TSR metric currently below threshold as of January 20, 2023.
How did stockholders respond to executive pay?
About 86% of votes cast at the 2022 Annual Meeting approved the say-on-pay proposal. After the meeting, the company contacted about 20 institutional stockholders representing approximately 41% of shares outstanding, and management met with holders representing about 7%. Those holders expressed support for strategy, performance, management and compensation policies, and the Compensation Committee kept its existing approach.
Who are the largest shareholders and how many shares are outstanding?
As of January 20, 2023, there were 158,974,105 shares outstanding. The Vanguard Group, Inc. beneficially owned 17,932,949 shares, or 11.28%, and BlackRock, Inc. beneficially owned 14,307,628 shares, or 9.0%. All current directors and executive officers as a group held 544,543 shares.
06—Continue