Qorvo

FY22

ANNUAL REPORT

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K

Í ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended April 2, 2022
or

‘ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from

to

Commission File Number 001-36801

®

Qorvo, Inc.
(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction of incorporation or organization)

46-5288992
(I.R.S. Employer Identification No.)
7628 Thorndike Road
Greensboro, North Carolina
(Address of principal executive office)
27409-9421
(Zip Code)
(336) 664-1233
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Trading Symbol(s)
QRVO

Title of each class
Common Stock, $0.0001 par value

Name of each exchange on which registered
The Nasdaq Stock Market LLC

the registrant

the Securities

is a well-known seasoned issuer, as defined in Rule 405 of

Indicate by check mark if
Act. Yes Í No ‘
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the
Act. Yes ‘ No Í
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90 days. Yes Í No ‘
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted
pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period
that the registrant was required to submit such files). Yes Í No ‘
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller
reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller
reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer Í Accelerated filer ‘ Non-accelerated filer ‘ Smaller reporting company ‘ Emerging growth company ‘
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ‘
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the
effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by
the registered public accounting firm that prepared or issued its audit report. Í
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ‘ No Í
The aggregate market value of the registrant’s common stock held by non-affiliates of the registrant was approximately
$18,621,370,109 as of October 2, 2021. For purposes of such calculation, shares of common stock held by persons who held
more than 10% of the outstanding shares of common stock and shares held by directors and officers of the registrant and their
immediate family members have been excluded because such persons may be deemed to be affiliates. This determination is not
necessarily conclusive.
As of May 13, 2022, there were 106,027,384 shares of the registrant’s common stock outstanding.

DOCUMENTS INCORPORATED BY REFERENCE
The registrant has incorporated by reference into Part III of this report certain portions of its proxy statement for its 2022 annual
meeting of stockholders, which is expected to be filed within 120 days after the end of the registrant’s fiscal year ended April 2,
2022.

QORVO, INC.

FORM 10-K

FOR THE FISCAL YEAR ENDED APRIL 2, 2022

TABLE OF CONTENTS

Forward-Looking Information.

Item 1. Business.
Item 1A. Risk Factors.
Item 1B. Unresolved Staff Comments.
Item 2.
Item 3.
Item 4. Mine Safety Disclosures.

Properties.
Legal Proceedings.

PART I

PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer

Purchases of Equity Securities.
[Reserved]

Item 6.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of

Operations.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk.
Item 8.
Item 9. Changes in and Disagreements With Accountants on Accounting and Financial

Financial Statements and Supplementary Data.

Disclosure.

Item 9A. Controls and Procedures.
Item 9B. Other Information.
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.

PART III

Item 10. Directors, Executive Officers and Corporate Governance.
Item 11. Executive Compensation.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related

Stockholder Matters.

Item 13. Certain Relationships and Related Transactions, and Director Independence.
Item 14. Principal Accounting Fees and Services.

Item 15. Exhibits and Financial Statement Schedules.
Item 16. Form 10-K Summary.
Exhibit Index.
Signatures.

PART IV

2

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3

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76

In this Annual Report on Form 10-K,
the words
“Qorvo,” “we,” “our,” “ours” and “us” refer only to
Qorvo,
Inc. and its subsidiaries and not any other
person or entity. The following discussion should be
read in conjunction with the consolidated financial
statements and notes thereto included elsewhere in
this Annual Report on Form 10-K.

Forward-Looking Information

some

These

“expect,”

“should,”

“believe,”

“estimate,”

of Operations.”

This Annual Report on Form 10-K contains forward-
looking statements within the meaning of the federal
securities laws, particularly in Item 1: “Business,”
Item 1A: “Risk Factors” and Item 7: “Management’s
Discussion and Analysis of Financial Condition and
forward-looking
Results
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 the use of terms such as “may,”
“will,”
“plan,”
“could,”
“anticipate,”
“forecast,”
“predict,” “potential,” “continue” and similar words,
although
are
forward-looking
statements
expressed
concerning
future
business, prospects, results of operations, financial
condition or research and development or technology
investments; new or enhanced products, services or
technologies; emerging industries or business models;
design wins or product launches; industry, market or
technology trends, dynamics or transitions, such as
the transition to 5G; potential
the
COVID-19 pandemic, legal or regulatory matters, U.S./
in Ukraine, or national
China trade,
security
our
customers;
statements
regarding matters that are not historical are also
forward-looking statements.

differently.
future matters

integration
other

such as our

competition;

the conflict

Additionally,

impacts of

statements

tensions;

vertical

and

by

reflect

Although forward-looking statements in this Annual
Report
the good faith judgment of our
management, such statements can only be based on
facts and factors currently known and understood by
us. Consequently, forward-looking statements involve
inherent risks and uncertainties, and actual financial
results and outcomes may differ materially and
adversely from the results and outcomes discussed in
or anticipated by the forward-looking statements.
Material
factors that could cause actual results to
differ materially from our expectations are summarized
and disclosed under “Risk Factors” in Part I, Item 1A
of this Annual Report on Form 10-K.

We undertake no obligation to revise or update any
forward-looking statements in order
to reflect any
event or circumstance that may arise after the date of
this Annual Report. Readers are cautioned to review
carefully and consider the various disclosures made in
this Annual Report, which attempt to advise interested
parties of the risks and factors that may affect our
results of operations
business,
and prospects.

financial condition,

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

PART I

ITEM 1. BUSINESS.

Company Overview
Qorvo® is a global
leader in the development and
commercialization of technologies and products for
wireless, wired and power markets.

laptops,

We have two reportable segments: Mobile Products
(“MP”) and Infrastructure and Defense Products
(“IDP”). MP is a global supplier of cellular, ultra-
wideband 802.15.4z (“UWB”), Wi-Fi and other wireless
including
solutions for a variety of applications,
smartphones, wearables,
tablets and the
Internet of Things (“IoT”). IDP is a global supplier of
radio frequency (“RF”), system-on-a-chip (“SoC”) and
power management solutions for a wide range of
markets,
including cellular and IT infrastructure,
automotive, renewable energy, defense and IoT. Our
MP segment supplies RF solutions to global consumer
product companies, and our IDP segment supplies a
more diverse portfolio of products with generally longer
life cycles to a broader base of customers and end
markets.

Our design expertise and manufacturing capabilities
span multiple process technologies. Our primary wafer
fabrication facilities are in North Carolina, Oregon and
Texas. Our primary assembly and test facilities are in
China, Costa Rica, Germany and Texas. We also
source products and materials through external
suppliers. We
other
manufacturing facilities throughout Asia, Europe and
North America.

design,

sales

have

and

of

assets

acquisition

businesses,

In addition to organic growth, our strategy may include
the
and
technologies that allow us to complement our existing
product offerings and design capabilities to drive
growth in new or existing markets. During fiscal 2022,
we acquired United Silicon Carbide,
(“United
SiC”), a provider of silicon carbide (“SiC”) power
products, and NextInput, Inc. (“NextInput”), a provider
of microelectromechanical system (“MEMS”)-based
sensing products.

Inc.

and

data

form factors,

traffic
throughput and efficiency. At

Industry Trends, Markets and Products
Global demand for wireless and wired connectivity,
supported by the proliferation of smarter, data-driven,
connected devices in a variety of
is
raising
increasing
network
requirements for
the
initiatives and
same time, global environmental
technology advancements related to energy efficiency,
sustainability and conservation are driving investments
across
industrial
applications that demand maximum power efficiency,
including in electric vehicles (“EVs”) and renewable
energy systems. These trends support multiyear
technology upgrade cycles in our markets and
increase the demand for our
technologies and
products.

consumer

range

and

of

a

3

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

Our business is diversified primarily across the
following end markets: mobile devices, cellular base
stations, power management and conversion, wireless
connectivity, defense and aerospace, automotive
To solve our
connectivity and other markets.
power-related
customers’ most
enhance performance,
challenges,
improve efficiency,
reduce
complexity, enable smaller form factors and address
other critical challenges.

increase functionality,

critical RF

products

and

our

Mobile Devices
Qorvo’s largest market is mobile devices, which is a
It
global market characterized by large volumes.
tablets
includes smartphones, wearables,
and other devices.

laptops,

Advances in mobile devices have transformed how end
users around the world access content, interact with
their physical and virtual communities and transact
commerce. Mobile devices are migrating to 5G
architectures and technologies which increase data
throughput, reduce signal latency and enable massive
machine-to-machine connectivity. 5G devices operate
over a wide range of frequencies and face challenges
related to efficiency,
linearity, signal coexistence,
signal integrity and form factor. 5G architectures are
more complex and include Multiple-Input/Multiple-
higher
secondary
Output
frequencies with wider bandwidths and new receive
paths featuring carrier aggregation. In each instance,
the increased functionality and greater complexity
increase RF content and favor high performance and
highly integrated solutions.

(“MIMO”),

transmit,

Mobile device original equipment manufacturers
(“OEMs”) are adopting UWB technology to enhance
functionality, including indoor navigation and secure
leveraging UWB’s precision-location
remote access,
accuracy. They are also seeking to adopt force-sensing
touch sensor technology to enhance human-machine
touch interfaces, create new consumer experiences
and advance industrial design.

amplifiers, multiplexers

Qorvo’s products for mobile devices include highly
integrated RF solutions which incorporate filters,
switches,
other
components in a single package. Our product portfolio
also includes RF power management
integrated
circuits, UWB SoC and system-in-package (“SiP”)
solutions, MEMS-based sensors, antenna tuners,
antennaplexers, as well as discrete multiplexers,
duplexers, filters, and switches.

and

Cellular Base Stations
Operators of cellular base stations are migrating to 5G
in order to increase capacity, expand coverage and
lower
the cost per bit of data delivered. This is
enabling new data-driven intelligent applications that
combine
artificial
intelligence and machine learning capabilities. New
robotics,
use cases include industrial automation,

hyper-connectivity with

global

4

remote medical care, autonomous vehicles and
augmented reality/virtual reality (“AR/VR”).

factors.

5G networks operate over a wide range of frequencies,
and deployments can vary with spectrum allocation,
regional demographics, geopolitical considerations
the completion of
In the U.S.,
and other
C-band auctions signaled the start of significant
growth for base stations in the sub-7 GHz frequency
range. Many of these base stations will be configured
with massive MIMO active antenna arrays which
increase the number of RF transmit and receive
channels. Base stations operating over millimeter
wave frequencies are also being deployed to address
the
high-density
requirements
environments and improve applications such as fixed
wireless access.

capacity

in

The continuing migration to 5G is increasing the
content opportunity
for Qorvo’s high-performance
infrastructure products, including those featuring our
gallium nitride (“GaN”), gallium arsenide (“GaAs”) and
bulk acoustic wave (“BAW”)
technologies. Qorvo
supports the world’s leading cellular base station
OEMs with a broad portfolio of infrastructure solutions
to address requirements for increased data capacity
and throughput and improved efficiency. Qorvo’s
products for cellular base stations include switch-low
noise amplifier
variable gain
(“LNA”) modules,
amplifiers, integrated power amplifier (“PA”) Doherty
modules, discrete LNAs and high power GaN
amplifiers.

is a core requirement

Power Management and Conversion
Power efficiency
in all
electronics, and power management and power
conversion are critical to enhancing efficiency. Industry
trends in EVs/hybrid-EVs, renewable energy systems,
portable devices, EV chargers/
battery-operated
on-board chargers, data storage, circuit protection and
similar applications, are sharpening the focus on
power efficiency and increasing the demand for our
power management and power conversion solutions.

Qorvo’s SiC power devices provide state-of-the-art
efficiency in a range of power conversion applications.
Our SiC portfolio includes Schottky diodes and
transistors ranging in voltage from 650V to 1700V.
Power
levels vary from 650 watts to hundreds of
kilowatts, and markets include automotive, industrial,
IT infrastructure and renewable energy.

solutions

power management

include
Qorvo’s
programmable power management integrated circuits
(“ICs”) and power application controllers (PACs®). Our
programmable
provide
power management
customers digital and analog power control. They
improve system
reduce solution size,
reliability
product
development time. Our power management products
manage voltages from 1.8V to 600V and power up to
4,000 watts.

lower cost,
our

customers’

shorten

and

ICs

Wireless Connectivity
The proliferation of data-driven connected devices that
sense, process and communicate is increasing
demand for wireless connectivity solutions that
improve speed, capacity and efficiency. Use cases in
consumer, commercial and industrial IoT applications
include connected cars,
cloud gaming, AR/VR,
telemedicine and factory automation. Each benefit
from faster throughput, lower latency, more security,
greater reliability and smaller form factors.

IoT connected devices allow remote access and
control of various functions, including entertainment,
comfort, security, energy usage and health or general
status monitoring, in home and office environments.
These devices can be controlled through a computer,
tablet or smartphone, or
through a more direct
peer-to-peer device such as a voice-enabled remote
control.

In Wi-Fi, new standards feature higher order MIMO
architectures and offer greater range and capacity. The
adoption of new standards, such as 802.11ax (Wi-Fi
6), Wi-Fi 6E and Wi-Fi 7, increases data throughput
and enable new use cases. In the U.S., the Federal
Communications Commission approved the use of 5.9
GHz to 7.1 GHz spectrum for Wi-Fi 6E, and countries
outside the U.S. are also making spectrum available
for Wi-Fi 6E. The upcoming Wi-Fi 7 standard will double
the channel bandwidth and number of spatial streams
available with Wi-Fi 6E and use multi-link operation to
combine portions of the 5 GHz and 6 GHz bands into a
single link. This will enable faster speeds over longer
distances than previous standards. As standards and
architectures evolve, requirements increase for more
functional and more highly integrated RF front end
solutions. Qorvo’s Wi-Fi portfolio includes PAs,
switches, LNAs and BAW filters, as well as integrated
solutions including front end modules (“FEMs”) and
integrated FEMs.

In lower power applications, smart device OEMs
increasingly prefer multi-protocol integrated SoCs that
enable multiple radios to connect concurrently. The
coexistence of low power wireless protocols, such as
Bluetooth Low Energy, Zigbee, and Thread, in single-
placement SoCs reduces form factor, extends battery
IoT devices.
life and advances the proliferation of
Similarly, Matter is an open and universal smart home
protocol
accelerate
interoperability across IoT devices and platforms.
Lastly, new use cases leveraging the ultra-precise
location accuracy and secure access enabled by UWB
are advancing the proliferation of UWB in a widening
range of applications.

expected

simplify

and

to

These trends are increasing demand for Qorvo’s low
power wireless and UWB solutions. Qorvo offers multi-
standard (Bluetooth Low Energy, Zigbee and Thread)
SoC solutions and single standard UWB SoC and SiP
solutions, consisting of SoC hardware, firmware and
application software.

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

the shift

Defense and Aerospace
Within the defense and aerospace markets, we focus
primarily on high-power phased array radar, electronic
military applications and communications systems.
The trend toward phased array radar,
to
frequencies and the sharing of existing
higher
frequency bands with cellular communications are
expanding the content opportunity for Qorvo’s high-
performance defense RF technologies and solutions.
We are a leading supplier of RF products and
compound semiconductor foundry services to defense
primes and other global defense and aerospace
customers. We also engage directly with defense
customers to develop next-generation semiconductor
and packaging technologies.

Our power amplifiers support phased array radars and
communication systems. Our solid-state, high-power
products provide highly reliable, efficient broadband
solutions for complex applications across a broad
frequency spectrum. Our premium filters optimize
frequency spectrum to expand network capacity and
extend coverage. We also offer
industry-leading
standard products and integrated multi-chip modules
such as LNAs, mixers, phase shifters, switches,
multiplexers and attenuators.

and

compute

technologies.

Automotive Connectivity
The automotive industry continues to adopt advanced
connectivity
Next-
generation wireless technologies are enabling new use
cases in automotive wireless connectivity, including
vehicle-to-everything (“V2X”) applications that enable
direct, high-speed communication. These new use
cases require complex RF solutions supporting a
range of wireless technologies,
including cellular,
Wi-Fi, GPS, satellite radio and UWB. UWB enables
more secure access than current
technologies,
helping to prevent so-called “man-in-the-middle” or
“relay” attacks.

We provide a variety of automotive RF connectivity
products, including BAW filters, LNAs, switches, PAs
and front-end solutions as well as UWB SoC solutions.
Our products meet or exceed automotive AEC-Q100
quality and reliability standards, and our customers
include the leading automotive OEMs, tier-1 suppliers
and chipset vendors.

compete

in which we

Other Markets
include
Other markets
broadband cable and biotechnology
In
broadband cable, our DOCSIS solutions increase
bandwidth to the home to optimize upstream and
downstream data
biotechnology
connectivity.
testing, we have developed a proprietary BAW-based
diagnostic test platform which received an Emergency
Use Authorization from the U.S. Food and Drug
Administration in fiscal 2022.

testing.

In

5

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

key

customers, which

Research and Development
in research and development (“R&D”) to
We invest
develop advanced technologies and products to best
serve our markets. Our R&D activities support large
competitive design win opportunities for major programs
best-in-class
at
performance, size, cost and functional density. We also
invest in R&D to develop new products for broader
market applications. Our R&D efforts require us to focus
on both continuous improvement and innovation in
software,
fundamental
semiconductor process technologies, simulation and
modeling, systems architecture, circuit design, device
packaging, module integration and test.

including materials,

require

areas

We have developed multiple generations of GaAs, GaN,
BAW and surface acoustic wave (“SAW”) process
technologies that we manufacture. We invest in these
technologies to improve device performance, reduce die
size and reduce manufacturing costs. We also source
technologies in cooperation with key suppliers, including
for switches and tuners,
silicon on insulator (“SOI”)
silicon
amplifiers,
complementary metal oxide semiconductor (“CMOS”) for
power management devices and SoC solutions, MEMS
technology for switches and force-sensing and SiC for
high voltage power conversion devices. We combine
these technologies with proprietary design methods,
intellectual property (“IP”) and other expertise to improve
performance, increase integration and reduce the size
and cost of our products.

germanium

(“SiGe”)

for

and

qualify

develop

advanced

packaging
We
improve
technologies to reduce component size,
performance and reduce package costs. We also invest
in large scale module assembly and test capabilities to
bring these technologies to market in very high volumes.

Raw Materials and Manufacturing
We purchase numerous raw materials and parts, such
as silicon, passive components and substrates, for our
manufacturing processes.
In our GaN and GaAs
manufacturing operations, we use several raw materials,
including GaN on SiC wafers and GaAs wafers. In our
acoustic filter manufacturing operations, raw materials
include silicon, lithium niobate and lithium tantalate.

We procure our materials, parts and supplies from a
large number of sources through established purchase
contracts with suppliers or on a purchase order basis.
As the semiconductor industry continued to experience
supply constraints for certain items during fiscal
2022, we have entered into certain supply agreements
to address short- and long-term supply requirements.

Our manufacturing strategy includes a balance of
internal and external capacity. Our manufacturing sites
are geographically distributed, as are our suppliers.
We routinely qualify additional manufacturing sites and
sources of supply to reduce the risk of supply
interruptions or price increases, and we closely
monitor our suppliers’ key performance indicators. We
seek to ensure that materials and manufacturing

6

services are available from multiple sources and
geographic locations.

The majority of our products are multi-chip modules
utilizing multiple semiconductor and acoustic material
processing technologies. These products have varying
degrees of complexity and contain semiconductors
and
are manufactured
internally or sourced from outside supply chain
partners.

components

other

that

GaN,

GaAs,

SAW and

We operate fabrication facilities for the production of
BAW,
Temperature
Compensated SAW wafers in North Carolina, Oregon
and Texas. We also use multiple silicon-based process
including SOI, SiGe and bulk CMOS,
technologies,
which are principally sourced from leading silicon
foundries located throughout the world. We have a
global supply chain and ship millions of units per day.

We have our own flip chip, wire bond and wafer-level
packaging technologies. We primarily use internal
assembly facilities in China, Costa Rica, Germany and
the U.S., and we also use external suppliers for these
and other packaging technologies.

factors,

Manufacturing yields can vary significantly between
products, based on a number of
including
product complexity, performance requirements and the
maturity of our manufacturing processes. To maximize
wafer yields and quality, we test products multiple
times, maintain continuous reliability monitoring and
conduct
inspections
quality
numerous
throughout the production flow.

control

internal manufacturing facilities require a high
Our
level of fixed costs, consisting primarily of occupancy
costs, maintenance, repair, equipment depreciation,
and labor costs related to manufacturing and process
engineering.

Semiconductor fabrication requires highly controlled
and clean environments. Die on a wafer can be found
to be nonfunctional or wafers can be rejected due to a
number of
including minute impurities,
variances in the fabrication process or defects in the
masks used to transfer circuit patterns onto the
wafers.

reasons,

Our manufacturing facilities worldwide are certified to
the International Organization for Standardization
(“ISO”) 9001 quality standard, and select locations
are certified to additional automotive (IATF 16949),
aerospace (AS 9100) and environmental (ISO 14001)
standards. These stringent standards are audited and
certified by third-party auditors in addition to our
continuous
ISO 9001
standard is based on a number of quality management
principles including a strong customer
the
motivation of top management, the process approach
and continual improvement. IATF 16949 is the highest
international quality standard for the global automotive
industry
additional
requirements for the automotive industry. AS 9100 is
the standardized quality management system for the

incorporates

self-audits.

specific

internal

focus,

and

The

upon

aerospace industry. ISO 14001 is an internationally
environmental
agreed
management system. We require that all of our key
vendors and suppliers be compliant with applicable
standards.

standard

for

an

Customers
We design, develop, manufacture and market products
for leading U.S. and international OEMs and original
design manufacturers (“ODMs”). We also collaborate
with leading reference design partners.

We provide products to our largest end customer,
Apple Inc. (“Apple”), through sales to multiple contract
manufacturers, which in the aggregate accounted for
33% and 30% of total revenue in fiscal years 2022
and 2021, respectively. Samsung Electronics Co., Ltd.
(“Samsung”) accounted for 11% and 7% of
total
revenue in fiscal years 2022 and 2021, respectively.
These customers primarily purchase RF solutions for a
variety of mobile devices.

Sales and Marketing
We sell our products worldwide both directly to
customers and through a network of U.S. and foreign
sales representative firms and distributors. We select
our sales representatives based on technical skills
and sales experience, the presence of complementary
lines and the customer base served. We
product
training about our
provide ongoing educational
products
sales
representatives and distributors. We maintain an
internal sales and marketing organization that
is
responsible for key account management, application
engineering
and
advertising literature, and technical presentations for
industry conferences. Our sales and customer support
centers are located near our customers throughout the
world.

customers,

external

support

internal

sales

and

our

for

to

Our website contains extensive product information
and includes an online store where customers can
learn about our products, download product catalogs,
order product samples and request evaluation boards.
Our global team of application engineers interacts with
customers during all stages of design and production,
maintains regular contact with customer engineers,
provides product application notes and engineering
data, and assists in the resolution of
technical
problems. We maintain close relationships with our
customers and chipset suppliers and provide them
strong technical support to enhance their customer
experience and help anticipate future product needs.

Seasonality
Our sales are the result of standard purchase orders
or specific agreements with customers. Our revenue
fluctuates based on consumer demand for devices as
well as the timing of customer device launches. Other
factors such as macroeconomic effects and the timing
of the next generation of technologies can also impact
the fluctuations in demand.

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

introductions. Our customers’ product

Competition
We operate in a competitive industry generally
characterized by rapid advances in technology and new
product
life
cycles can be short, and our competitiveness depends
on our ability to improve our products and processes
faster
than our competitors, anticipate changing
customer requirements and successfully develop and
launch new products while reducing our costs. Our
competitiveness is also affected by the quality of our
customer service and technical support and our ability
to design customized products that address each
customer’s particular
requirements. The selection
process for our products is highly competitive, and our
customers provide no guarantees that our products
will be included in the next-generation of products
introduced.

and

Inc.;

MP competes primarily with Broadcom Inc.; Murata
Manufacturing Co., Ltd.; NXP Semiconductors N.V.;
Qualcomm Technologies,
Skyworks
Solutions,
IDP competes primarily with Analog
Inc.
Devices, Inc.; Broadcom Inc.; Infineon Technologies
AG; MACOM Technology Solutions Inc.; Murata
Manufacturing Co., Ltd.; Nordic Semiconductor; NXP
Semiconductors N.V.; ON Semiconductor Corporation;
Inc.; Silicon Laboratories
Qualcomm Technologies,
Inc.; Skyworks Solutions,
Inc.; STMicroelectronics
N.V.; Sumitomo Electric Device Innovations; and
Wolfspeed, Inc.

and

positions

Many of our current and potential competitors have
entrenched market
customer
relationships, established patents and other IP and
substantial technological capabilities. In some cases,
our competitors are also our customers or suppliers.
Additionally, many of our competitors may have
significant
technical, manufacturing and
marketing resources, which may allow them to more
quickly implement new technologies and develop new
products.

financial,

Intellectual Property
Our IP, including patents, copyrights, trademarks and
trade secrets, is important to our business, and we
actively seek opportunities to leverage our IP portfolio
to promote our business interests. We also actively
monitor and protect our global
IP rights to deter
unauthorized use of our IP and other assets. These
efforts can be difficult because of the absence of
consistent
In
addition, the laws of some foreign countries do not
protect IP rights to the same extent as U.S. laws. We
respect the IP rights of others and have implemented
policies and procedures to mitigate the risk of
infringing or misappropriating third-party IP.

international standards and laws.

Patent applications are filed within the U.S. and in
other countries where we have a market presence. On
occasion, some applications do not mature into
patents for
including rejections
based on prior art. We have approximately 2,200
patents that expire from 2022 to 2041. We also
continue to acquire patents through acquisitions or

various reasons,

7

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

the

and

comparative

direct prosecution efforts and engage in licensing
transactions to secure the right to use third-parties’
patents. In view of our rapid innovation and product
pace
development
of
governments’ patenting processes,
there is no
guarantee that our products will not be obsolete
before the related patents expire or are granted.
However, we believe the duration and scope of our
most relevant patents are sufficient to support our
business, which as a whole is not significantly
dependent on any particular patent or other IP right.
As we expand our products and offerings, we also
seek to expand our patent prosecution efforts to cover
such products.

on

rely

non-disclosure

We periodically register federal trademarks, service
marks and trade names that distinguish our product
brand names in the market. We also monitor these
marks for their proper and intended use. Additionally,
confidentiality
we
agreements to protect our interest in confidential and
proprietary information that gives us a competitive
advantage, including business strategies, unpatented
inventions, designs and process technology. Such
information is closely monitored and made available
only
to those employees whose responsibilities
require access to the information.

and

Human Capital
We believe that our employees are our greatest
assets, and we must continue to attract, develop,
retain and motivate our employees to remain
competitive and execute our business strategy. We
strive to meet these objectives by offering competitive
pay and benefits in a diverse,
inclusive and safe
workplace and by providing opportunities for our
employees to grow and develop their careers.

As of April 2, 2022, we employed over 8,900 full and
part-time employees in 22 countries. By
region,
approximately 57% of our total employees were in the
Americas, 37% in
Europe.
Approximately 60% of our global population was in
engineering or technician roles.

and 6% in

Asia

Competitive Pay and Benefits
We provide compensation and benefits packages that
we believe are competitive within the applicable
market. We use a combination of compensation and
other programs (which vary by region and salary grade)
to attract, motivate and retain our employees,
including semiannual performance bonuses, stock
awards, an employee stock purchase plan, retirement
programs, health savings and flexible spending
family care
accounts, paid time off,
resources,
employee
assistance programs, tuition assistance, health and
wellness benefits and programs, and on-site fitness
centers. We benchmark our
compensation and
benefits packages annually to ensure we remain
competitive with our peers and continue to attract and
retain talent throughout our organization.

family leave,
schedules,

flexible

work

8

Employee Recruitment, Retention and Development
retaining,
We are committed to recruiting, hiring,
promoting and engaging a diverse workforce to best
serve our global customers. We have established
relationships with professional associations and
industry groups to proactively attract talent, and we
partner with universities for our internship program.
We believe that our commitment to our internship
program and university partnerships contributes to
developing the next generation of
including
engineers in our industry, and provides a pipeline of
talent pool. We
recent college graduates into our
offered
internship
opportunities during the last
two fiscal years that
enabled us to continue building our talent pipeline
despite the COVID-19 pandemic.

remote

talent,

hybrid

both

and

We support a high-performance culture through
learning and development solutions aligned with our
strategic priorities. We offer e-learning libraries and
on-demand training that provide our employees with
real-time learning opportunities to help them achieve
their career goals, build management skills and lead
their organizations.

We believe our competitive compensation and benefits
programs, along with career growth and development
opportunities promote longer employee tenure and
reduce turnover. We monitor employee turnover rates
as our success depends upon retaining and investing
in our worldwide talent. Our global attrition rate has
consistently been below the technology
industry
average.

and

inclusion.

advocate
groups

for
called Qorvo

Diversity, Equity and Inclusion
At Qorvo, we value diversity, equity and inclusion and
respect the unique talents, experiences, cultures and
ideas of our global
team members. Diversity and
inclusion principles are threaded across the entire
company, and employees are equipped with the
knowledge and capabilities to welcome and embrace
Through
diversity
employee-driven
Employee
Networks, our employees have an opportunity to
connect through shared interests and goals and spur
growth
personal
professional
development. Our efforts to foster a diverse and
inclusive
with
organizations in our surrounding communities that
advocate
ethnicity,
socioeconomic, disability and LGBTQ+ equality. These
and other efforts help promote an inclusive workplace
employee
talented
of
engagement.

employees

partnering

workplace

through

gender,

include

drive

race

and

and

and

for

Safety, Health and Wellness
We are a member of
the Responsible Business
Alliance (“RBA”), an industry coalition dedicated to
driving sustainable value for workers in global supply
chains, among other things. As a member of the RBA,
we have adopted the RBA Code of Conduct, which
that working
to
establishes
conditions are safe, that employees are treated with

standards

ensure

respect and dignity, and that business operations are
environmentally responsible and conducted ethically.
The RBA Code of Conduct has been reflected in our
employee policies and procedures.

for

provide

training

prioritize

conditions

safe working

We
our
employees as well as our on-site contractors and
visitors. We are committed to an injury-free workplace
and
and
dedicated workplace
leadership support to reduce or eliminate health and
safety risks. In response to the COVID-19 pandemic,
we instituted comprehensive safety protocols for all
Qorvo facilities. We successfully
transitioned a
considerable number of our employees to work from
home, and we invested in additional wellness
benefits, including reimbursement programs to help
employees improve home workspaces. In fiscal 2022,
we achieved our safety goal for the fourth consecutive
year, while providing a safe working environment for
our many essential workers on-site through the
COVID-19 pandemic. As we make plans to transition
to return to the office, we will provide our employees
with work arrangements that support flexibility, while
maintaining
innovation,
collaboration, openness and camaraderie, in addition
to a safe working environment for our employees.

culture

strong

our

of

The success of our business is fundamentally
connected to the well-being of our employees. We
provide our employees and their families access to a
variety of health and wellness programs that support
their physical and mental health. These programs
provide tools and resources that emphasize preventive
care, encourage healthy behaviors, such as health
coaches and wellness incentives, and are designed to
help cultivate a productive work environment, while
also focusing on the well-being of our employees.

Government Regulations
We are subject to a variety of extensive and changing
domestic and international
federal, state and local
governmental laws, regulations and ordinances related
to the discharge of pollutants into the environment;
the treatment, transport, and disposal of hazardous
waste; recycling and product packaging; worker health
and
the
environment, our workforce, and the management of
our manufacturing operations.

activities

affecting

safety;

other

and

We continuously improve the environmental aspects of
our manufacturing processes and are dedicated to:
‰ providing a safe and healthy work environment for

our employees;

‰ complying with regulatory and other requirements;
‰ using natural
efficiently;

resources, energy, and materials

‰ substituting sustainable resources in place of

non-renewable resources;

‰ reusing or recycling materials wherever technically

possible and economically reasonable;

‰ minimizing waste and disposing of waste safely and

responsibly;

‰ sourcing raw material responsibly; and

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

‰ implementing specific measures to prevent and
minimize hazards to humans and the environment
including pollution prevention.

For

our

products

We believe that our operations and facilities comply in
respects with applicable environmental
all material
laws and worker health and safety laws, and our
efforts help to ensure that our products are compliant
with the requirements of the markets into which the
products will be sold and with our customers’
are
example,
requirements.
compliant with the European Union RoHS Directive
(2011/65/EU on the Restriction of Use of Hazardous
Substances), which prohibits the sale in the European
Union market of new electrical and electronic
equipment containing certain families of substances
above a specified threshold. We are an ISO
14001:2015
a
comprehensive Environmental Management System
the
(“EMS”)
environmental aspects of the manufacturing process.
Our EMS mandates compliance and establishes
appropriate checks and balances to minimize the
potential for non-compliance with environmental laws
and regulations.

in place to help ensure control of

manufacturer

certified

with

We are also subject to import/export controls, tariffs
and other trade-related regulations and restrictions in
countries in which we have operations or otherwise do
business. These controls,
regulations, and
restrictions (including those related to, or affected by,
United States-China relations, as discussed below in
Item 1A, “Risk Factors”) may have a material impact
on our business, including our ability to sell products
and to manufacture or source components.

tariffs,

Government regulations are subject to change, and
accordingly we are unable to assess the possible
effect of compliance with future requirements or
whether our compliance with such regulations will
materially impact our business, results of operations
or financial condition.

Cybersecurity
Qorvo’s cybersecurity program is built around the ISO
and National Institute for Standards and Technology
frameworks. Cybersecurity risks are routinely identified
in the Qorvo Enterprise Risk Management Program
and cybersecurity assessment and planning. Senior
management and the Audit Committee of the Board of
Directors receives regular briefings on cybersecurity
matters. Qorvo’s cybersecurity program includes, but
is not limited to:
‰ annual cybersecurity budget planning across all

information technology disciplines;

‰ enterprise security policies and procedures that

guide our protection strategy;

‰ a combination of broad cybersecurity training (all
specific

employees) and targeted training
sensitive roles and functions;

for

9

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

‰ prioritization of system and process criticality to
apply enhanced security protections to the most
business-critical areas of the company;

‰ reviewing and continually monitoring the security
posture of critical third parties (e.g., suppliers and
service providers);
‰ exercising Qorvo’s

incidents
through incident response exercises and root cause
analysis of actual and near-miss incidents;

preparedness

for

‰ integration of

in-house cybersecurity services with

third-party security service providers; and

‰ regular internal and external cybersecurity audits and
the Audit

assessments,
at
Committee of the Board of Directors.

direction

the

of

Access to Public Information
We make available, free of charge through our website
(https://www.qorvo.com), our annual and quarterly
reports on Forms 10-K and 10-Q (including exhibits
and related filings in iXBRL format) and current reports
on Form 8-K and amendments to these reports filed or
furnished pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934, as amended (the
“Exchange Act”) as soon as reasonably practicable
after we electronically file these reports with, or
furnish them to,
the United States Securities and
Exchange Commission (“SEC”). The SEC maintains a
website at https://www.sec.gov that contains reports,
other
proxy
information regarding issuers that file electronically
with the SEC. The public may also request a copy of
our forms filed with the SEC, without charge upon
written request, directed to:

statements,

information

and

and

Investor Relations Department
Qorvo, Inc.
7628 Thorndike Road
Greensboro, NC 27409-9421

The information contained on, or that can be accessed
through, our website is not incorporated by reference
or considered to be a part of this Annual Report on
Form 10-K.

ITEM 1A. RISK FACTORS.

You should carefully consider
the risks described
below in addition to the other information contained in
this report before making an investment decision with
to any of our securities. Our business,
respect
financial condition or results of operations could be
materially impacted by any of these risks. The risks
and uncertainties described below are not the only
ones we face. Additional risks not currently known to
us, or other factors not perceived by us to present
material risks to our business at this time, may impair
our business operations, financial condition, or results
of operations.

as

our

Risk Factors Summary
The following is a summary of the principal risks that
could adversely affect our business, financial condition
or results of operations.
‰ Our operating results fluctuate and are substantially
and
dependent
achieving
customers’
requirements can change rapidly and product life
cycles can be short.

developing
wins

new products

on
design

‰ We depend on several

large customers for a
substantial portion of our revenue and the loss of
one or more of
these customers could have a
material adverse effect on our business, financial
condition and results of operations.

‰ We face risks of 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.

‰ We may be subject

to continued volatility and
uncertainty
worldwide
economies and financial markets resulting from the
ongoing impact of the COVID-19 pandemic.

customer

demand,

‰ We depend heavily on third parties.
‰ We face risks related to sales through distributors.
‰ We face risks associated with the operation of our
manufacturing facilities, and if we experience poor
manufacturing yields, our operating results may
suffer.

‰ We are subject to inventory risks and costs because
we purchase materials and build our products based
on forecasts provided by customers before receiving
purchase orders for the products.

‰ We sell certain of our products based on reference
designs of chipset suppliers, and our inability to
effectively manage
evolving
relationships with these companies may have an
adverse effect on our business.

or maintain

‰ We are subject to risks from international sales and

our

in

operations.

‰ We may not be able to generate sufficient cash to
service all of our debt or to fund capital expenditures
and may be forced to take other actions to satisfy
our debt obligations and financing requirements,
which may not be successful or on terms favorable
to us.

10

‰ Our acquisitions and other strategic investments
financial or strategic
could fail
objectives, disrupt our ongoing business, and
adversely impact our results of operations.

to achieve our

‰ In order to compete, we must attract, retain, and
motivate key employees, and our failure to do so
could harm our business and our
results of
operations.

‰ We rely on our intellectual property portfolio and may
not be able to successfully protect against the use
of our intellectual property by third parties, and we
may be subject to claims of infringement of third-
party intellectual property rights.

‰ Security breaches and other disruptions could
compromise our proprietary information, expose us
to liability or disrupt our ability to operate critical
business functions, which would cause our business
and reputation to suffer.

For a more complete discussion of the material risks
facing our business, see below.

Risks Related to Our Business and Industry

for other

Our operating results fluctuate.
Our revenue, earnings, margins and other operating
results have fluctuated significantly in the past and
may fluctuate significantly in the future. If demand for
our products fluctuates as a result of economic
revenue and
conditions or
profitability could be impacted. Our future operating
results will depend on many factors,
including the
following:
‰ business and macroeconomic changes,

including
trade restrictions and recession or slowing growth in
the semiconductor industry and the overall global
economy;

reasons, our

‰ political and/or civil unrest, acts of war or other
military actions, including any resulting sanctions or
other restrictive actions;

‰ changes in consumer confidence caused by many
factors, including changes in interest rates, credit
levels, energy or other
markets, unemployment
commodity prices as well as changes in existing and
expected rates of inflation;

‰ fluctuations in demand for our customers’ products;
‰ our ability to forecast our customers’ demand for our

products accurately;

‰ the ability of third-party foundries and other third-
party suppliers to manufacture, assemble and test
our products and otherwise deliver on their
commitments to us in a timely and cost-effective
manner;

‰ our customers’ and distributors’ ability to manage
they hold and to forecast

the inventory
accurately their demand for our products;

‰ delays in the widespread deployment of commercial
5G networks or in consumer adoption of 5G-enabled
devices;

‰ our ability to achieve cost savings and improve
yields and margins on our new and existing
products;

that

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

‰ our ability

to successfully

integrate into our
business, and realize the expected benefits of, our
acquisitions and strategic investments; and

‰ our ability to utilize our capacity efficiently or to
acquire additional capacity in response to customer
demand.

Our operating results have been and our
future
operating results could be adversely affected by one or
more of the factors set forth above or other similar
factors. If our future operating results are below the
expectations of
stock market analysts or our
investors, our stock price may decline.

Our operating results are substantially dependent on
developing new products and achieving design wins
as our customers’ requirements can change rapidly
and product life cycles can be short.
Our largest markets are characterized by the frequent
introduction of new products in response to evolving
product requirements, driven by end user demand for
more functionality, improved performance, lower costs
and a variety of
largest MP
customers typically refresh some or all of their product
portfolios by releasing new models each year. In some
cases, product designs we pursue represent either
opportunities to substantially increase our revenue by
winning a new design or a risk of a substantial
decrease in revenue by losing a product on which we
are the incumbent.

form factors. Our

Our success depends on our ability to develop and
introduce new products in a timely and cost-effective
manner and secure production orders from our
customers. The development of new products is a
highly complex process, and we have experienced
delays in completing the development and introduction
times. Our successful product
of new products at
factors,
development depends on a number of
including the following:
‰ our ability to predict market requirements and define
and design new products that address those
requirements;

to design products that meet our
performance

cost,

size

and

‰ our ability
customers’
requirements;

‰ our ability to introduce new products that are
competitive and can be manufactured at lower costs
or that command higher prices based on superior
performance;

‰ acceptance of our new product designs;
‰ the availability of qualified product design engineers;
‰ our timely completion of product designs and ramp
up of new products according to our customers’
needs with acceptable manufacturing yields; and
‰ market acceptance of our customers’ products and

the duration of the life cycle of such products.

We may not be able to design and introduce new
products in a timely or cost-efficient manner, and our
new products may fail to meet market or customer
design
requirements.
product
involve multiple
opportunities

Most
that we

major
pursue

11

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

competitors, and we could lose a new product design
opportunity to a competitor that offers a lower cost or
equal or superior performance. If we are unsuccessful
in achieving design wins, our revenue and operating
results will be adversely affected. Even when a design
win is achieved, our success is not assured. Design
wins may require significant expenditures by us and
typically precede a higher volume revenue by six to
nine months or more. Many customers seek a second
source for all major components in their devices,
which can significantly reduce the revenue obtained
from a design win. In many cases, the average selling
prices of our products decline over the products’ lives,
and we must achieve yield improvements, cost
reductions and other productivity enhancements in
order to maintain profitability. The actual value of a
design win to us will ultimately depend on the
commercial success of our customers’ products.

We depend on several large customers for a
substantial portion of our revenue and the loss of one
or more of these customers could have a material
adverse effect on our business, financial condition
and results of operations.
A substantial portion of our MP revenue is currently
from several
large customers. Our future operating
results will be affected by both the success of our
largest customers and on our success in diversifying
our products and customer base. Collectively, our two
largest end customers accounted for an aggregate of
approximately 44%, 39% and 43% of our revenue for
fiscal years 2022, 2021 and 2020, respectively. If
demand for their products increases, our results are
favorably impacted, while if demand for their products
decreases, they may reduce their purchases of, or
stop purchasing, our products and our operating
results would suffer. Even if we achieve a design win,
our customers can delay or cancel the release of a
new handset for any reason. Most of our customers
can cease incorporating our products into their
devices with little notice to us and with little or no
penalty. The loss of a large customer and failure to
add new customers to replace lost revenue would
have a material adverse effect on our business,
financial condition and results of operations.

States

We face risks of 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.
We receive a portion of our revenue from the United
States government and from prime contractors on
United
programs,
principally for defense and aerospace applications.
These programs are subject to delays or cancellation.
Further, spending on defense and aerospace programs
can vary significantly depending on funding from the
United States government. We believe our government
and defense and aerospace business has been
negatively affected in the past by external factors such
as sequestration and political pressure to reduce

government-sponsored

12

federal defense spending. Reductions in defense and
aerospace funding or the loss of a significant defense
and aerospace program or contract would have a
material adverse effect on our operating results.

We may be subject to continued volatility and
uncertainty in customer demand, worldwide
economies and financial markets resulting from the
ongoing impact of the COVID-19 pandemic.
The COVID-19 pandemic has caused government
authorities to implement numerous public health
measures, including quarantines, business closures,
travel bans and lockdowns to contain the virus. We
have
to
experience disruptions to our business as these
measures have, and may continue to have, an effect
on our customer demand and operations.

experienced

continue

expect

and

to

of

the

the

industry

in
and

demand,

(including

customer
financial markets. We

The COVID-19 pandemic
recent
COVID-19 lockdowns in China) has been a contributing
factor
supply
semiconductor
constraints and may continue to cause volatility and
worldwide
uncertainty
economies
have
experience,
experienced, and may
disruptions to our supply chain and increased costs in
with
connection
of materials,
components,
logistics services and other services
caused in part by the pandemic. To date, any negative
impact of COVID-19 on the overall demand for our
products, cash flows from operations, need for capital
liquidity position has been
expenditures and our
limited,
capacity
are
although we
constraints in our supply chain.

addressing

continue

sources

our

to

practices

(including

employee

The spread of COVID-19 caused us to modify our
business
travel,
employee work locations, and cancellation of events
and conferences), and we may reinstitute these and
take further actions as may be required by government
authorities or
that we determine are in the best
interests of our employees, customers, partners, and
suppliers. There is no certainty that such measures
will be sufficient to mitigate the risks posed by the
virus, and our ability to perform critical functions could
be harmed.

The degree to which COVID-19 and its variants impact
our results will depend on future developments, which
are highly uncertain and cannot be predicted,
including, but not limited to, the duration and spread
its severity, and the actions to
of
the pandemic,
its
contain the virus or
impact.

immunize against or

treat

We depend heavily on third parties.
We purchase numerous component parts, substrates
and silicon-based products from external suppliers.
We also utilize third-party suppliers for numerous
services, including die processing, wafer bumping, test
and tape and reel. The use of external suppliers
involves a number of risks, including the possibility of
material disruptions in the supply of key components

and the lack of control over delivery schedules,
capacity constraints, manufacturing yields, product
quality and cost increases. Furthermore, the COVID-19
pandemic and related supply chain disruptions and
labor market constraints have created heightened risk
that external suppliers may be unable to meet their
obligations to us.
If we experience any significant
difficulty in obtaining the materials or services used in
the conduct of our business, these supply challenges
may limit our ability to fully satisfy customer demand.

supply

achieve

commitments,

As the semiconductor industry continued to experience
supply constraints for certain items during fiscal
2022, we have entered into certain supply agreements
to address short- and long-term supply requirements.
However, even with supply agreements, we are still
subject to risks that a supplier will be unable to meet
its
anticipated
manufacturing yields, produce wafers on a timely
basis, or provide additional wafer capacity beyond its
current contractual commitments sufficient to meet
our supply needs. If so, we may experience delays in
product
launches or supply shortages for certain
products, which could cause an unanticipated decline
in our sales and damage our existing customer
relationships and our ability to establish new customer
relationships.
if a supplier experiences
financial difficulties or goes into bankruptcy, it could
be difficult or impossible, or may require substantial
time and expense, for us to recover any or all of our
fees and deposits made as part of any supply
agreement.

In addition,

to us to be
Although our key suppliers commit
compliant with applicable ISO 9001 and/or TS-16949
quality standards, we have experienced quality and
reliability issues with suppliers in the past. Quality or
reliability issues in our supply chain could negatively
affect our products, our reputation and our results of
operations.

on

depend

distributors. We

We face risks related to sales through distributors.
We sell a significant portion of our products through
third-party
these
distributors to help us create end customer demand,
provide technical support and other
value-added
services to customers, fill customer orders, and stock
our products. We may rely on one or more key
distributors for a product, and a material change in our
relationship with one or more of these distributors or
their failure to perform as expected could reduce our
revenue. Our ability to add or replace distributors for
some of our products may be limited because our end
customers may be hesitant to accept the addition or
replacement of a distributor due to advantages in the
incumbent
and
favorable business terms related to payments,
discounts and stocking of acceptable inventory levels.
Using third parties for distribution exposes us to many
risks, including competitive pressure, concentration,
credit risk, and compliance risks. Other third parties
may use one of our distributors to sell products that

distributors’

technical

support

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

to

and

other

financial

incentives

distributors may

compete with our products, and we may need to
the
provide
distributors to focus them on the sale of our products.
Our
face financial difficulties,
including bankruptcy, which could harm our collection
of accounts receivable and financial results. Violations
of the Foreign Corrupt Practices Act or similar laws by
our distributors or other
third-party intermediaries
could have a material impact on our business. Failure
to manage risks related to our use of distributors may
increase expenses, and weaken our
reduce sales,
competitive position.

We face risks associated with the operation of our
manufacturing facilities.
We operate wafer
fabrication facilities in North
Carolina, Oregon and Texas. We currently use several
international and domestic assembly suppliers, as
well as internal assembly facilities in China, Costa
Rica, Germany and the U.S., to assemble and test our
products. We currently have our own test and tape and
reel facilities located in China, Costa Rica and the
U.S., and we also utilize contract suppliers and
partners in Asia to test our products.

results,

A number of factors related to our facilities will affect
our business and financial
including the
following:
‰ our ability to adjust production capacity in a timely
fashion in response to changes in demand for our
products;

‰ the significant fixed costs of operating the facilities;
‰ factory utilization rates;
‰ our ability to qualify our facilities for new products

and new technologies in a timely manner;

‰ the availability of raw materials, the impact of the
volatility of commodity pricing and tariffs imposed on
raw materials, including substrates, gold, platinum
and high purity source materials such as gallium,
aluminum, arsenic, indium, silicon, phosphorous and
palladium;

‰ our manufacturing cycle times;
‰ our manufacturing yields;
‰ the
political,
associated with our
operations;

regulatory

and

risks
international manufacturing

economic

‰ potential violations by our international employees or
laws

international or U.S.

third-party agents of
relevant to foreign operations;

train and manage qualified

‰ our ability to hire,
production personnel;

‰ our compliance with applicable environmental and

other laws and regulations; and

‰ our ability to avoid prolonged periods of down-time in
our facilities for any reason, including but not limited
to, COVID-19.

Business disruptions could harm our business, lead
to a decline in revenues and increase our costs.
Our worldwide operations and business could be, and
in some cases have been, disrupted by natural
cybersecurity
disasters,

accidents,

industrial

13

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

incidents, telecommunications failures, power or water
shortages, extreme weather conditions, public health
issues (including the COVID-19 pandemic), terrorist
attacks, political and/or civil unrest, acts of war or
other military actions, political or regulatory issues and
other man-made disasters or catastrophic events.
Global climate change could result in certain natural
disasters occurring more frequently or with greater
intensity, such as drought, wildfires, storms and
flooding. We carry commercial property damage and
business interruption insurance against various risks,
with limits we deem adequate, for reimbursement for
damage to our fixed assets and resulting disruption of
our operations. However, the occurrence of any of
these business disruptions could harm our business
and result in significant losses, a decline in revenue
and an increase in our costs and expenses. Any
disruptions
require
substantial expenditures and recovery time in order to
resume operations and could also have a
fully
material adverse effect on our operations and financial
results to the extent that losses are uninsured or
exceed insurance recoveries and to the extent that
such disruptions adversely impact our relationships
with our customers. Furthermore, even if our own
operations are unaffected or recover quickly, if our
customers or suppliers cannot timely resume their
own operations due to a business disruption, natural
disaster or catastrophic event, customers may reduce
or cancel
their orders and suppliers may delay
manufacturing and delivery of our products, which may
adversely affect our results of operations.

from these

events

could

for

their

exact

specifications

If we experience poor manufacturing yields, our
operating results may suffer.
Our products have unique designs and are fabricated
using multiple process technologies that are highly
complex. In many cases, our products are assembled
in customized packages. Many of our products consist
of multiple components in a single module and feature
enhanced levels of
integration and complexity. Our
customers insist that our products be designed to
meet
quality,
performance and reliability. Our manufacturing yield is
a combination of yields across the entire supply chain,
including wafer fabrication, assembly and test yields.
in an assembled
Defects in a single component
module product can impact the yield for the entire
module, which means the adverse economic impacts
of an individual defect can be multiplied many times
over if we fail to discover the defect before the module
is assembled. Due to the complexity of our products,
we periodically experience difficulties in achieving
acceptable yields and other quality issues, particularly
with respect to new products. Furthermore, as our
customers test our products once assembled into
their products, we may be exposed to additional
quality issues and costs.

14

The number of usable products that result from our
production process can fluctuate as a result of many
factors, including:
‰ design errors;
‰ defects in photomasks (which are used to print

circuits on a wafer);

‰ minute impurities and variations in materials used;
‰ contamination of the manufacturing environment;
‰ equipment failure or variations in the manufacturing

processes;

‰ losses from broken wafers or other human error; and
‰ defects in substrates and packaging.

We constantly seek to improve our manufacturing
yields. Typically, for a given level of sales, when our
yields improve, our gross margins improve, and when
our yields decrease, our unit costs are higher, our
margins are lower, and our operating results are
adversely affected. Costs of product defects and
deviations from required specifications include the
following:
‰ writing off inventory;
‰ scrapping products that cannot be reworked;
‰ accepting returns of products that have been

shipped;

‰ providing product replacements at no charge;
‰ reimbursement of direct and indirect costs incurred
reworking their

by our customers in recalling or
products due to defects in our products;

‰ travel and personnel costs to investigate potential
product quality issues and to identify or confirm the
failure mechanism or root cause of product defects;
and

‰ defending against litigation.

These costs could be significant and could reduce our
gross margins. Our reputation with customers also
could be damaged as a result of product defects and
quality issues, and product demand could be reduced,
which could harm our business and financial results.

We are subject to inventory risks and costs because
we purchase materials and build our products based
on forecasts provided by customers before receiving
purchase orders for the products.
In order to ensure availability of our products for some
of our largest end customers, we purchase materials
and start manufacturing certain products in advance of
receiving purchase orders based on forecasts provided
by these customers. However, these forecasts do not
represent binding purchase commitments and we do
not recognize sales for these products until they are
shipped to or consumed by the customer. As a result,
we incur significant inventory and manufacturing costs
in advance of anticipated sales. For example, amidst
ongoing industry-wide supply constraints, we entered
into a capacity reservation agreement with a foundry
supplier during the second quarter ended October 2,
2021. Under
the agreement we are required to
purchase, and the supplier is required to supply, a
certain number of wafers for calendar years 2022
the Notes to
through 2025. See Note 11 of

Consolidated Financial Statements for additional
information. Because demand for our products may
not materialize, or may be lower
than expected,
purchasing materials and manufacturing based on
forecasts subjects us to heightened risks of higher
inventory carrying costs, increased obsolescence and
higher operating costs. These inventory risks are
exacerbated when our customers purchase indirectly
through contract manufacturers or hold component
inventory levels greater than their consumption rate
because this reduces our visibility regarding the
customers’ accumulated levels of inventory. If product
demand decreases or we fail
to forecast demand
accurately, we could be required to write off inventory,
which would have a negative impact on our gross
margin and other operating results.

We sell certain of our products based on reference
designs of chipset suppliers, and our inability to
effectively manage or maintain our evolving
relationships with these companies may have an
adverse effect on our business.
Chipset suppliers are typically large companies that
provide system reference designs for OEMs and ODMs
that include the chipset supplier’s baseband and other
complementary products. A chipset supplier may own
or control IP that gives it a strong market position for
its baseband products for
interface
standards, which provides it with significant influence
and control over sales of RF products for
these
standards. Chipset suppliers historically looked to us
and our competitors to provide RF products to their
customers as part of the overall system design, and
we competed with other RF companies to have our
products included in the chipset supplier’s system
reference design. This market dynamic has evolved as
chipset suppliers have worked to develop more fully
include their own RF
integrated solutions that
technologies and components.

certain air

if

they offer

Chipset suppliers may be in a different business from
ours or we may be their customer or direct competitor.
Accordingly, we must balance our interest in obtaining
new business with competitive and other
factors.
Because chipset suppliers control the overall system
reference design,
competitive RF
technologies or their own RF solutions as a part of
their reference design and exclude our products from
the design, we are at a distinct
competitive
disadvantage with OEMs and ODMs that are seeking a
turn-key design solution, even if our products offer
superior performance. This requires us to work more
closely with OEMs and ODMs to secure the design of
our products in their handsets and other devices.

Our relationships with chipset suppliers are complex
and evolving, and the inability to effectively manage or
maintain these relationships could have an adverse
effect on our business, financial condition and results
of operations.

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

We operate in a very competitive industry and must
continue to innovate.
We compete with several companies primarily engaged
in the business of designing, manufacturing and selling
RF solutions, as well as suppliers of discrete
In addition to our
integrated circuits and modules.
direct competitors, some of our largest end customers
and leading platform partners also compete with us to
some extent by designing and manufacturing their own
products. Increased competition from any source could
adversely affect our operating results through lower
prices for our products,
reduced demand for our
products,
losses of existing design slots with key
customers and a corresponding reduction in our ability
and
recover
to
manufacturing costs.

development,

engineering

The

Many of our existing and potential competitors have
entrenched market positions, historical affiliations with
OEMs, considerable internal manufacturing capacity,
technological
established IP rights and substantial
capabilities.
has
experienced increased industry consolidation over the
last several years, a trend we expect to continue. Many
of our existing and potential competitors may have
greater financial, technical, manufacturing or marketing
resources than we do. We cannot be sure that we will
be able to compete successfully with our competitors.

semiconductor

industry

Overcapacity could cause us to underutilize our
manufacturing facilities and have a material adverse
effect on our financial performance.
It is difficult to predict future demand for our products,
future
which makes
requirements for production capacity and avoid
periods of overcapacity. Fluctuations in the growth rate
of
industry capacity relative to the growth rate in
demand for our products also can lead to overcapacity
and contribute to cyclicality in the semiconductor
market.

estimate

difficult

to

it

trends and demand well

Capacity expansion projects have long lead times and
require capital commitments based on forecasted
product
in advance of
production orders from customers. In recent years, we
have made significant capital
investments to expand
our premium filter capacity to address forecasted
these
future demand patterns.
capacity additions exceeded the near-term demand
requirements, leading to overcapacity situations and
underutilization of our manufacturing facilities.

In certain cases,

during

periods

experienced

As many of our manufacturing costs are fixed, these
costs cannot be reduced in proportion to the reduced
revenues
of
underutilization. Underutilization of our manufacturing
facilities can adversely affect our gross margin and
other operating results. If demand for our products
experiences a prolonged decrease, we may be required
to close or idle facilities and write down our long-lived
lives of underutilized
assets or shorten the useful
depreciation,
and
assets

accelerate

15

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

which would increase our expenses. For example, to
in the third
address manufacturing overcapacity,
quarter of
fiscal 2019 we commenced a phased
closure of a SAW filter manufacturing facility in Florida
and a transfer of production to our North Carolina
facility, which was completed in fiscal 2020. In fiscal
2021, we temporarily idled a BAW manufacturing
facility in Texas. These actions resulted in impairment
charges,
other
restructuring related charges and expenses.

depreciation

accelerated

and

Unfavorable changes in interest rates, pricing of
certain precious metals, utility rates and foreign
currency exchange rates may adversely affect our
financial condition, liquidity and results of
operations.
We may utilize hedging strategies from time to time to
mitigate the impact due to underlying exposures such
as interest rates, precious metal prices, utility rates,
or currency exchange rates. However, the impact from
these
be
predicted or hedged, and there can be no assurance
that our hedging strategies will be effective in
minimizing risk.

exposures

underlying

cannot

always

offer

growth

technical capabilities, or

Our acquisitions and other strategic investments
could fail to achieve our financial or strategic
objectives, disrupt our ongoing business, and
adversely impact our results of operations.
As part of our business strategy, we expect
to
continue to review potential acquisitions and strategic
investments that could complement our current
product offerings, augment our market coverage or
enhance our
that may
otherwise
or margin improvement
opportunities. In the event of future acquisitions of
businesses, products or technologies, we could issue
current
equity securities that would dilute our
stockholders’ ownership,
incur substantial debt or
financial obligations or assume contingent
other
liabilities. Such actions could harm our
results of
the price of our common stock.
operations or
Acquisitions and strategic investments also entail
numerous other risks that could adversely affect our
business,
financial
results
condition, including:
‰ failure to complete a transaction in a timely manner,
if at all, due to our
inability to obtain required
government or other approvals, IP disputes or other
litigation, difficulty in obtaining financing on terms
acceptable to us, or other unforeseen factors;

‰ controls, processes, and procedures of an acquired
business may not adequately ensure compliance
with laws and regulations, and we may fail to identify
compliance issues or liabilities;

‰ unanticipated costs, capital expenditures or working

operations

and

of

capital requirements;

‰ acquisition-related charges and amortization of

acquired technology and other intangibles;

‰ the potential loss of key employees from a company

we acquire or in which we invest;

16

‰ diversion of management’s attention from our

business;

‰ disruption of our ongoing operations;
‰ dis-synergies or other harm to existing business

relationships with suppliers and customers;

‰ losses

or

impairment
research

of
and

investments

development

from
by

unsuccessful
companies in which we invest;

‰ failure

to

successfully

acquired
businesses, operations, products, technologies and
personnel; and

integrate

‰ unrealized expected synergies.

Moreover, our resources are limited and our decision
to pursue a transaction has opportunity costs;
accordingly, if we pursue a particular transaction, we
may need to forgo the prospect of entering into other
transactions that could help us achieve our financial
or strategic objectives. Any of these risks could have a
material adverse effect on our business, results of
operations,
flows,
particularly in the case of a large acquisition.

condition,

financial

cash

or

In order to compete, we must attract, retain, and
motivate key employees, and our failure to do so
could harm our business and our results of
operations.
In order to compete effectively, we must hire and retain
qualified employees, continue to develop leaders for
key business units and functions, expand our presence
in international locations and adapt to cultural norms
of
foreign locations and train and motivate our
employee base. Labor is further subject to external
including our
factors that are beyond our control,
industry’s highly competitive market for skilled workers
and leaders, cost inflation, the COVID-19 pandemic
and workforce participation rates. Our future operating
results and success depend on keeping key technical
personnel and management and expanding our sales
and marketing, R&D and administrative support. We do
not have employment agreements with the vast
majority of our employees. We must also continue to
The competition for
attract qualified personnel.
qualified personnel
is intense, and the number of
people with experience, particularly in RF engineering,
integrated circuit and filter
software engineering,
is
design, and technical marketing and support,
limited. In addition, existing or new immigration laws,
policies or regulations in the U.S. may limit the pool of
available talent. Travel bans, difficulties obtaining visas
and other
travel could
restrictions on international
to effectively manage our
make it more difficult
international operations, operate as a global company
or service our international customer base. Changes in
the interpretation and application of employment-
related laws to our workforce practices may also result
in increased operating costs and less flexibility in how
we meet our changing workforce needs. We cannot be
sure that we will be able to attract and retain skilled
personnel in the future, which could harm our business
and our results of operations.

We are subject to warranty claims, product recalls
and product liability.
From time to time, we may be subject to warranty or
product liability claims that could lead to significant
expense. We may also be exposed to such claims as
a result of any acquisition we may undertake in the
future. Although we maintain reserves for reasonably
estimable liabilities and purchase product
liability
insurance, we may elect to self-insure with respect to
certain matters and our reserves may be inadequate
to cover the uninsured portion of such claims.

contain

typically

liability insurance is subject

Product
to significant
deductibles, and such insurance may be unavailable
or inadequate to protect against all claims. If one of
our customers recalls a product containing one of our
devices, we may incur significant costs and expenses,
including replacement costs, direct and indirect
product recall-related costs, diversion of technical and
other resources and reputational harm. Our customer
contracts
and
indemnification provisions, and in certain cases may
also contain liquidated damages provisions, relating to
product
liabilities
associated with such provisions are significant, and in
some cases, including in agreements with some of our
largest end customers, are potentially unlimited. Any
such liabilities may greatly exceed any revenue we
receive from sale of the relevant products. Costs,
payments or damages incurred or paid by us in
connection with warranty and product liability claims
and product
recalls could materially and adversely
affect our financial condition and results of operations.

potential

warranty

issues.

quality

The

the U.S. and numerous other

Changes in our effective tax rate may adversely
impact our results of operations.
We are subject
Singapore,
jurisdictions. Our effective tax rate is subject
fluctuations and impacted by a number of
including the following:
‰ changes in our overall profitability and the amount of
profit determined to be earned and taxed in
jurisdictions with differing statutory tax rates;

to taxation in China, Germany,
foreign
to
factors,

‰ the resolution of issues arising from tax audits with
various tax authorities, including those described in
the Notes to Consolidated Financial
Note 13 of
Statements;

‰ changes in the valuation of either our gross deferred

tax assets or gross deferred tax liabilities;

‰ adjustments to income taxes upon finalization of

various tax returns;

‰ changes
purposes;

in expenses not deductible for

tax

‰ changes in available tax credits; and
‰ changes in tax laws, domestic and foreign, or the
interpretation of such tax laws, and changes in
generally accepted accounting principles.

Any significant
increase in our
rates could reduce net income for future periods.

future effective tax

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

Changes in the favorable tax status of our
subsidiaries in Costa Rica and Singapore would have
an adverse impact on our operating results.
Our subsidiaries in Costa Rica and Singapore have
been granted tax holidays that minimize our
tax
expense and that are expected to be effective through
December 2027 and December 2031, respectively. In
their efforts to deal with budget deficits, governments
around the world are focusing on increasing tax
revenues through increased audits and, potentially,
increased tax rates for corporations. As part of this
effort, governments continue to review their policies
on granting tax holidays. Future changes in the status
of either tax holiday could have a negative effect on
our net income in future years.

and

other

In 2017,

The enactment of international or domestic tax
legislation, or changes in regulatory guidance, may
adversely impact our results of operations.
reform, base-erosion efforts, and
Corporate tax
increased tax
transparency continue to be high
priorities in many tax jurisdictions in which we have
business operations.
the U.S. enacted
comprehensive tax legislation, commonly referred to
as the Tax Cuts and Jobs Act (the “Tax Act”), which
included a number of changes to U.S. tax laws that
impacted us, including the one-time transition tax on
certain unrepatriated earnings of foreign subsidiaries
(the “Transitional Repatriation Tax”) and the Global
Intangible Low-Taxed Income (“GILTI”) provisions. In
addition, other countries are beginning to implement
legislation
their
tax rules with the Organisation for
international
Economic Co-operation and Development’s Base
Erosion and Profit Shifting recommendations and
action plan, which aim to standardize and modernize
global corporate tax policy, including changes to cross-
transfer pricing documentation rules,
border
nexus-based tax incentive practices, allocating greater
taxing rights to countries where customers are
located, and establishing a minimum tax on global
interpretations and
income. Legislative changes,
guidance, and changes in prior
tax rulings and
decisions by tax authorities regarding treatments and
positions of corporate income taxes resulting from
these initiatives, could increase tax uncertainty,
increase our effective tax rate, and result in taxes we
previously paid being subject to change, which may
adversely impact our financial position and results of
operations.

guidance

align

tax,

to

We are subject to risks associated with
environmental, health and safety regulations,
including those related to climate change.
We are subject to a broad array of U.S. and foreign
environmental, health and safety laws and regulations.
These laws and regulations include those related to
the use, transportation, storage, handling, emission,
discharge and recycling or disposal of hazardous
materials used in our manufacturing, assembly and
testing processes. Our failure to comply with any of

17

regulations could

Risks Related to Our International Sales and
Operations

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

future laws or

these existing or
result in:
‰ regulatory penalties and fines;
‰ legal

remedial measures
contaminated;
to

secure
governmental approvals;

‰ expenses

liabilities, including financial responsibility for
are

properties

our

if

required

permits

and

‰ reputational damage;
‰ suspension or curtailment of our manufacturing,

assembly and test processes; and

‰ increased costs to acquire pollution abatement or
remediation equipment or to modify our equipment,
facilities or manufacturing processes to bring them
into compliance with applicable laws and regulations.

often

which

exceed

policies,

Existing and future environmental laws and regulations
could also impact our product designs and limit or
restrict the materials or components that are included
in our products. In addition, many of our largest end
customers require us to comply with corporate social
responsibility
include
employment, health, safety, environmental and other
requirements
legal
that
Further, an increasing number of
requirements.
investors are also expecting companies to disclose
environmental,
(“ESG”)
and
policies, practices and metrics, on topics such as
climate change, carbon emissions, water usage,
waste management, and human capital. Compliance
with these policies increases our operating expenses,
and non-compliance can adversely affect customer
and investor relationships and harm our business and
the price of our common stock.

governance

applicable

social

Regulations in the U.S. currently require that we
determine whether certain materials used in our
products, referred to as conflict minerals, originated in
the Democratic Republic of the Congo or adjoining
countries, or were from recycled or scrap sources. We
may face challenges with government regulators and
our customers and suppliers if we are unable to
sufficiently make any required determination that the
metals used in our products are conflict free.

to procure.

New climate change laws and regulations could
require us to change our manufacturing processes or
procure substitute raw materials that may cost more
or be more difficult
In addition, new
restrictions on emissions of carbon dioxide or other
greenhouse gases could result in increased costs for
us and our suppliers. Various jurisdictions are
developing other climate change-based regulations
that also may increase our expenses and adversely
affect our operating results. We expect
increased
worldwide regulatory activity relating to climate change
in the future. Future compliance with these laws and
regulations, as well as meeting related customer and
investor expectations, may adversely affect our
business and results of operations.

18

We are subject to risks from international sales and
operations.
We operate globally with sales offices and R&D
activities as well as manufacturing, assembly and test
facilities in multiple countries, and some of our
business activities are concentrated in Asia. As a
result, we are subject to regulatory, geopolitical and
other risks associated with doing business outside the
U.S., including:
‰ global and local economic, social and political

conditions and uncertainty;

‰ currency

fluctuations;

controls and currency exchange rate

‰ inflation, as well as changes in existing and
expected rates of inflation, which vary across the
jurisdictions in which we do business;

‰ formal or informal
doing-business
sanctions, tariffs and other related restrictions;

imposition of export, import or
trade

regulations,

‰ labor market conditions and workers’ rights affecting
those of our

our manufacturing operations or
customers or suppliers;

including

‰ disruptions

in
commodities trading markets;

capital

and

securities

and

‰ occurrences of geopolitical crises such as terrorist
activity, armed conflict, civil or military unrest or
instability such as the conflict in Ukraine,
political
which may
assembly,
logistics, security and communications and result in
reduced demand for our products;

disrupt manufacturing,

‰ compliance with laws and regulations that differ
among jurisdictions, including those covering taxes,
intellectual property ownership and infringement,
imports and exports, anti-corruption and anti-bribery,
and
antitrust
environment, health, and safety;

competition,

‰ markets for 5G infrastructure not developing in the
manner or
in the time periods we anticipate,
including as a result of unfavorable developments
with evolving laws and regulations worldwide; and
‰ pandemics and similar major health concerns,
including COVID-19 and related mitigation actions
(such as the recent lockdowns in China), which could
adversely affect our business and our customer
order patterns.

privacy,

data

and

to customers

Sales
located outside the U.S.
accounted for approximately 58% of our revenue in
fiscal 2022, of which approximately 32% was
attributable to sales to customers located in China.
We expect that revenue from international sales to
China and other markets will continue to be a
significant part of our total revenue. Any weakness in
the Chinese economy could result in a decrease in
demand for consumer products that contain our
products, which could materially and adversely affect
our business. The imposition by the U.S. of tariffs on
goods
countermeasures
from China,
imposed by China in response, U.S. export restrictions

imported

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

on sales of products to China and other government
actions that restrict or otherwise adversely affect our
ability to sell our products to Chinese customers may
have a material impact on our business, including our
ability to sell products and to manufacture or source
components.

and other items in certain countries, particularly in
China. For example, the imposition of tariffs has not
had a direct, material adverse impact on our business;
however, the direct and indirect effects of tariffs and
other restrictive trade actions are difficult to measure
and are only one part of economic and trade policy.

time as our

As a global company, our
results are affected by
movements in currency exchange rates. Our exposure
may increase or decrease over
foreign
business levels fluctuate in the countries where we have
operations, and these changes could have a material
impact on our financial results. The functional currency for
most of our international operations is the U.S. dollar. We
have foreign operations in Asia, Europe and Central
America, and a substantial portion of our revenue is
derived from sales to customers outside the U.S. Our
international revenue is primarily denominated in U.S.
dollars. Operating expenses and certain working capital
items related to our foreign-based operations are, in some
instances, denominated in the local foreign currencies
and therefore are affected by changes in the U.S. dollar
exchange rate in relation to foreign currencies, such as
the Costa Rican Colon, Euro, Pound Sterling, Renminbi
the U.S. dollar weakens
and Singapore Dollar.
compared to these and other currencies, our operating
expenses for
foreign operations will be higher when
remeasured back into U.S. dollars.

If

currency

including

Economic regulation in China could adversely impact
our business and results of operations.
We have a significant portion of our assembly and
testing capacity in China. For many years, the Chinese
economy has experienced periods of rapid growth and
wide fluctuations in the rate of inflation. In response to
these factors, the Chinese government has, from time to
time, adopted measures to regulate growth and to
controls and
contain inflation,
measures designed to restrict credit, control prices or
set currency exchange rates. Such actions in the future,
as well as other changes in Chinese laws and
regulations, including actions in furtherance of China’s
stated policy of reducing its dependence on foreign
semiconductor manufacturers, could increase the cost
of doing business in China, foster the emergence of
Chinese-based competitors, decrease the demand for
our products in China and reduce the supply of critical
materials for our products, which could have a material
adverse effect on our business and results of
operations.

Changes in government trade policies, including the
imposition of tariffs and export restrictions, have
limited and could continue to limit our ability to sell or
provide our products and other items to certain
customers and suppliers, which may materially
adversely affect our sales and results of operations.
The U.S. or foreign governments have taken and may
continue to take administrative, legislative or regulatory
action that could materially interfere with our ability to
products
and
export,

reexport,

transfer

from exporting,

Furthermore, we have experienced and may continue
to experience restrictions on our ability to export,
reexport, and transfer our products and other items to
certain foreign customers and suppliers where
exports, reexports, or transfers of products require
export
licenses or are prohibited by government
action. The U.S. government has in the past imposed
export restrictions that effectively banned American
and
companies
transferring products to certain of our customers. If
such restrictions are imposed again in the future and
even if subsequently lifted, any financial or other
penalties could have a continuing negative impact on
our
In
future revenue and results of operations.
addition, our customers or suppliers affected by future
U.S. government sanctions or threats of sanctions
may respond by developing their own solutions to
foreign
replace our products or by adopting our
competitors’ solutions.

reexporting,

to tariffs or other

We cannot predict what further actions may ultimately
be taken with respect
trade
measures between the U.S. and China or other
countries, what products or entities may be subject to
such actions, or what actions may be taken by other
countries in response. The loss of foreign customers
or suppliers or the imposition of restrictions on our
ability to sell or transfer products to such customers
or suppliers as a result of tariffs, export restrictions or
other U.S.
could materially
adversely affect our sales, business and results of
operations.

regulatory

actions

Risks Related to Our Indebtedness

We may not be able to generate sufficient cash to
service all of our debt or to fund capital expenditures
and may be forced to take other actions to satisfy our
debt obligations and financing requirements, which
may not be successful or on terms favorable to us.
Our ability to make scheduled payments on or
to
refinance our debt obligations and to fund working
capital, planned capital expenditures and expansion
efforts and any strategic alliances or acquisitions we
may make in the future depends on our ability to
financial
generate cash in the future and on our
condition and operating performance, which are
subject
to prevailing economic and competitive
conditions and to certain financial, business and other
factors beyond our control. We cannot be sure that we
will maintain a level of cash flows from operating
activities sufficient to permit us to pay our debt. If our
cash flows and capital resources are insufficient to
fund our debt service obligations, we may face liquidity
issues and be forced to reduce or delay investments
to sell assets, seek
and capital expenditures, or

19

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

the use of

additional capital or restructure or refinance our debt.
These alternative measures may not be successful
and may not permit us to meet our scheduled debt
service and other obligations. Additionally, our credit
agreement and the indentures governing our senior
the proceeds from any
notes limit
disposition; as a result, we may not be allowed under
these documents to use proceeds from such
dispositions to satisfy our debt service obligations.
Further, we may need to refinance all or a portion of
our debt at or before maturity, and we cannot be sure
that we will be able to refinance any of our debt on
commercially reasonable terms or at all.

The agreements and instruments governing our debt
impose restrictions that may limit our operating and
financial flexibility.
The credit agreement governing our revolving facility
and term loan and the indentures governing our senior
notes contain a number of significant restrictions and
covenants that limit our ability to:
‰ incur additional debt;
‰ pay

dividends, make

distributions

other

or

repurchase or redeem our capital stock;
‰ prepay, redeem or repurchase certain debt;
‰ make loans and investments;
‰ sell, transfer or otherwise dispose of assets;
‰ incur or permit to exist certain liens;
‰ enter

into certain types of

transactions with

affiliates;

‰ enter into agreements restricting our subsidiaries’

ability to pay dividends; and

‰ consolidate, amalgamate, merge or sell all or

substantially all of our assets.

certain

including a significant

financial maintenance

These covenants could have the effect of limiting our
flexibility in planning for or reacting to changes in our
business and the markets in which we compete. In
addition, our credit agreement requires us to comply
with
covenants.
Operating results below current levels or other adverse
factors,
increase in interest
rates, could result in our being unable to comply with
the financial covenants contained in our
revolving
facility.
If we violate covenants under our credit
agreement and are unable to obtain a waiver from our
lenders, our debt under our revolving facility would be
in default and could be accelerated by our lenders.
Because of cross-default provisions in the agreements
and instruments governing our debt, a default under
one agreement or instrument could result in a default
under, and the acceleration of, our other debt. If our
debt is accelerated, we may not be able to repay our
debt or borrow sufficient funds to refinance it. Even if
we are able to obtain new financing, it may not be on
commercially reasonable terms, or
terms that are
acceptable to us. If our debt is in default for any
reason, our business, financial condition and results
of operations could be materially and adversely
affected. In addition, complying with these covenants
may also cause us to take actions that are not
favorable to holders of the notes and may make it

20

more difficult
for us to successfully execute our
business strategy and compete against companies
that are not subject to such restrictions.

Risks Related to Intellectual Property, Information
Technology and Data Privacy

We rely on our intellectual property portfolio and may
not be able to successfully protect against the use of
our intellectual property by third parties.
We rely on a combination of patents, trademarks,
laws, confidentiality procedures and
trade secret
licensing arrangements to protect our
intellectual
property rights. We cannot be certain that patents will
be issued from any of our pending applications or that
patents will be issued in all countries where our
products can be sold. Further, we cannot be certain
that any claims allowed from pending applications will
be of sufficient scope or strength to provide
meaningful protection against our competitors. Our
competitors may also be able to design around our
patents.

The laws of some countries in which our products are
developed, manufactured or sold may not protect our
products or intellectual property rights to the same
extent as U.S. laws. This increases the possibility of
misappropriation or infringement of our technology and
products. Although we intend to vigorously defend our
intellectual property rights, we may not be able to
technology.
prevent misappropriation
Additionally,
to
able
independently develop non-infringing technologies that
are substantially equivalent or superior to ours.

competitors may

our

our

be

of

intellectual property

We may need to engage in legal actions to enforce or
defend our
rights. Generally,
intellectual property litigation is both expensive and
unpredictable. Our involvement in intellectual property
litigation could divert the attention of our management
and technical personnel and have a material, adverse
effect on our business.

We may be subject to claims of infringement of third-
party intellectual property rights.
Our operating results may be adversely affected if
third parties were to assert claims that our products
infringed their patent, copyright or other intellectual
property
rights. Such assertions could lead to
expensive and unpredictable litigation, diverting the
attention of management and technical personnel. An
unsuccessful result in any such litigation could have
adverse effects on our business, which may include
injunctions, exclusion orders and royalty payments to
third parties. In addition, if one of our customers or
another supplier to one of our customers were found
to be infringing on third-party intellectual property
rights, such a finding could adversely affect
the
demand for our products.

Security breaches and other disruptions could
compromise our proprietary information, expose us to
liability or disrupt our ability to operate critical
business functions, which would cause our business
and reputation to suffer.
technical know-how and
We rely on trade secrets,
other unpatented proprietary information relating to
our product development and manufacturing activities
to provide us with competitive advantages. We protect
this
into confidentiality
consultants,
agreements with
strategic partners and other third parties. We also
design our computer systems and networks and
implement various procedures to restrict unauthorized
access to dissemination of our proprietary information.

information by entering

employees,

our

We face internal and external data security threats.
Current, departing or former employees or third parties
could attempt to improperly use or access our computer
systems and networks to copy, obtain or misappropriate
our proprietary information or otherwise interrupt our
business. Like others, we are also subject to significant
system or network disruptions from numerous causes,
including computer viruses and other cyber-attacks,
facility access issues, new system implementations and
energy blackouts.

breaches,

computer malware,

Security
phishing,
spoofing, and other cyber-attacks have become more
prevalent and sophisticated in recent years. While we
defend against these threats on a daily basis, we do not
believe that such attacks to date have caused us any
material damage. Because the techniques used by
computer hackers and others to access or sabotage
networks constantly evolve and generally are not
recognized until launched against a target, we may be
unable to anticipate, counter or ameliorate all of these
techniques. As a result, our and our customers’
proprietary information may be misappropriated and the
impact of any future incident cannot be predicted. Any
loss of such information could harm our competitive
position, result in a loss of customer confidence in the
threat mitigation and detection
adequacy of our
processes and procedures, cause us to incur significant
costs to remedy the damages caused by the incident,
and divert management and other
resources. We
routinely
improvements to our network
security safeguards and we are devoting increasing
resources to the security of our information technology
systems. We cannot, however, assure that such system
improvements will be sufficient to prevent or limit the
damage from any
future cyber-attack or network
disruptions.

implement

Furthermore, we rely on products and services provided
by
third-party suppliers to operate certain critical
business systems, including without limitation, cloud-
based infrastructure, encryption and authentication
technology, employee email, and other functions, which
exposes us to supply-chain attacks or other business
disruptions. We cannot guarantee that third parties and
or
infrastructure

supply

chain

our

in

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

our partners’ supply chains have not been compromised
or that they do not contain exploitable defects or bugs
that could result in a breach of or disruption to our
information technology systems, including our products
and services, or the third-party information technology
systems that support our services. Our ability to monitor
these third parties’
information security practices is
limited, and these may not have adequate information
security measures in place. In addition, if one of our
third- party suppliers suffers a security breach, our
response may be limited or more difficult because we
may not have direct access to their systems, logs and
other information related to the security breach.

If any of our systems are damaged, fail to function
properly or otherwise become unavailable, we may
incur substantial costs to repair or replace them and
may experience loss or corruption of critical data and
interruptions or delays in our ability to perform critical
functions, which could affect adversely our business
and results of operations. Furthermore,
the costs
related to cyber-attacks or other security threats or
computer systems disruptions typically would not be
fully insured or indemnified by others. Occurrence of
any of the events described above could also result in
loss of competitive advantages derived from our R&D
efforts or our IP. Moreover, these events may result in
the early obsolescence of our products, product
development delays, or diversion of the attention of
management and key information technology and
other
resources, or otherwise adversely affect our
internal operations and reputation.

We may be subject to theft, loss, or misuse of
personal data by or about our employees, customers
or other third parties, which could increase our
expenses, damage our reputation, or result in legal
or regulatory proceedings.
In the ordinary course of our business, we have
access to sensitive, confidential or personal data or
information regarding our employees and others that
is subject to privacy and security laws and regulations,
as well as our own policies and standards. The theft,
loss, or misuse of personal data collected, used,
stored, or transferred by us to run our business, or by
our third-party service providers,
including business
process software applications providers and other
vendors that have access to sensitive data, could
result in damage to our reputation, disruption of our
business activities, significantly increased business
and security costs or costs related to defending legal
claims.

Global privacy legislation, enforcement, and policy
activity in this area are rapidly expanding and creating
a complex regulatory compliance environment. For
example, the European Union has adopted the General
Data Protection Regulation (“GDPR”), which requires
companies to comply with rules regarding the handling
of personal data, including its use, protection and the
ability of persons whose data is stored to correct or

21

price of our common stock offered by a bidder in a
takeover context and may also make it more difficult
for a third party to replace directors on our board of
directors. Further, the existence of these provisions
may adversely affect the prevailing market price of our
they are viewed as discouraging
common stock if
takeover attempts in the future.

be

The price of our common stock has recently been
and may in the future be volatile.
The price of our common stock, which is traded on the
Nasdaq Global Select Market, has been and may
continue
to wide
to
fluctuations.
In addition, the trading volume of our
common stock may fluctuate and cause significant
price variations to occur. Some of the factors that
could cause fluctuations in the stock price or trading
volume of our common stock include:
‰ general market
economic

subject

volatile

and

and

and
including market

political
conditions in the

conditions,
semiconductor industry;

‰ actual or expected variations in quarterly operating

results;

‰ pandemics and similar major health concerns,

including the COVID-19 pandemic;

‰ differences between actual operating results and

those expected by investors and analysts;

‰ changes in recommendations by securities analysts;
‰ operations and stock performance of competitors

and major customers;

‰ accounting charges, including charges relating to the

impairment of goodwill and restructuring;

‰ significant acquisitions, strategic alliances, capital
commitments, or new products announced by us or
by our competitors;

‰ differences, whether actual or perceived, between
our corporate social responsibility and ESG practices
and disclosure and investor expectations;

‰ sales of our common stock, including sales by our

directors and officers or significant investors;

‰ repurchases of our common stock;
‰ recruitment or departure of key personnel; and
‰ loss of key customers.

We cannot assure that the price of our common stock
will not fluctuate or decline significantly in the future.
can
In addition,
experience considerable price and volume fluctuations
that are unrelated to our performance.

the stock market

in general

ITEM 1B. UNRESOLVED STAFF COMMENTS.

None.

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

In

addition,

delete such data about themselves. Failure to meet
GDPR requirements could result in penalties of up to
4% of worldwide
the
revenue.
interpretation and application of consumer and data
protection laws in the U.S., Europe and elsewhere are
often uncertain and fluid, and may be interpreted and
applied in a manner that is inconsistent with our data
practices. Complying with these changing laws has
caused, and could continue to cause, us to incur
substantial costs, which could have an adverse effect
on our business and results of operations. Further,
failure to comply with existing or new rules may result
in significant penalties or orders to stop the alleged
non-compliant activity. Finally, even our
inadvertent
failure to comply with federal, state, or international
privacy-related or data protection laws and regulations
could
or
proceedings against us by governmental entities or
others.

regulatory

inquiries

audits,

result

in

Risks Related to Owning our Common Stock

Our certificate of incorporation and bylaws and the
General Corporation Law of the State of Delaware
may discourage takeovers and business
combinations that our stockholders might consider
to be in their best interests.
Certain provisions in our amended and restated
certificate of incorporation and amended and restated
bylaws may have the effect of delaying, deterring,
preventing or rendering more difficult, a change in
control of Qorvo that our stockholders might consider
to be in their best interests. These provisions include:
‰ granting to the board of directors sole power to set
the number of directors and fill any vacancy on the
board of directors, whether such vacancy occurs as
a result of an increase in the number of directors or
otherwise;

‰ the ability of the board of directors to designate and
issue one or more series of preferred stock without
stockholder approval, the terms of which may be
determined at the sole discretion of the board of
directors;

‰ the inability of stockholders to call special meetings

of stockholders;

‰ establishment of advance notice requirements for
stockholder proposals and nominations for election
to the board of directors at stockholder meetings;
and

‰ the inability of stockholders to act by written

consent.

that

contains

provisions

In addition, the General Corporation Law of the State
of Delaware
regulate
“business combinations” between corporations and
interested stockholders who own 15% or more of the
corporation’s voting stock, except under certain
circumstances.
also
discourage potential acquisition proposals and delay
or prevent a change in control.

provisions

These

could

These provisions may prevent our stockholders from
receiving the benefit of any premium to the market

22

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

ITEM 2. PROPERTIES.

Our corporate headquarters (leased) and our MP headquarters (owned) are in Greensboro, North Carolina, and our
IDP headquarters (owned) is in Richardson, Texas.

The following table sets forth our primary production facilities as of April 2, 2022:

Location

Greensboro, North Carolina
Hillsboro, Oregon
Richardson, Texas
Beijing, China (1)
Dezhou, China
Heredia, Costa Rica
Nuremberg, Germany

Owned/Leased

Primary Function

Owned
Owned
Owned
Owned
Leased
Owned
Leased

Wafer fabrication
Wafer fabrication
Wafer fabrication, assembly and test
Module assembly and test
Module assembly and test
Module and filter assembly and test
Packaging and test

(1) We hold land-use rights for the land associated with this property.

In fiscal 2021, we temporarily idled a BAW manufacturing facility (owned) in Farmers Branch, Texas.

We believe our properties have been well-maintained, are in sound operating condition and contain all equipment
and facilities necessary to operate at present levels. While we believe all our facilities are suitable and adequate
for our present purposes, we continually evaluate our business and facilities and may decide to expand, add or
dispose of facilities in the future. The majority of our production facilities are shared by our operating segments.

ITEM 3.

LEGAL PROCEEDINGS.

See the information under the heading “Legal Matters” in Note 11 of the Notes to Consolidated Financial
Statements.

ITEM 4. MINE SAFETY DISCLOSURES.

Not Applicable.

PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER

PURCHASES OF EQUITY SECURITIES.

Our common stock is traded on the Nasdaq Global Select Market under the symbol “QRVO.” As of May 13, 2022,
there were 653 holders of record of our common stock, which does not include beneficial owners of stock held in
street name (i.e., through a brokerage firm, bank, broker-dealer, trust or other similar organization).

We have never declared or paid any dividends on our common stock. We currently intend to retain any future
earnings to invest in the growth and operation of our business and do not intend to pay any dividends for the
foreseeable future. Any future determination related to our dividend policy will be made at the discretion of our
board of directors.

The following graph and table compare the cumulative total shareholder return of our common stock, the S&P 500
Index, the Nasdaq Electronic Components Index (former industry index) and the S&P Semiconductors Index (new
industry index), for the five years ended April 2, 2022. We believe the new industry index is more representative of
the industry in which we operate. The graph and table assume an initial investment of $100 was made on April 1,
2017 in each of our common stock and the indexes, reflecting compounded daily returns as well as reinvestment
of all dividends. The indexes are reweighted daily using the market capitalization on the previous trading day. The
comparisons in the graph and table are based on historical data and are not indicative of, or intended to forecast,
the possible future performance of our common stock.

23

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

PERFORMANCE GRAPH

COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN
Among Qorvo, Inc., the S&P 500 lndex,
the NASDAQ Electronic Components Index and the S&P Semiconductors Index

$400

$350

$300

$250

$200

$150

$100

$50

$0
4/1/17

3/31/18

3/30/19

3/28/20

4/3/21

4/2/22

Qorvo, Inc.

S&P 500

S&P Semiconductors

NASDAQ Electronic Components

Qorvo, Inc.
S&P 500
S&P Semiconductors (new industry index)
Nasdaq Electronic Components

(former industry index)

April 1,
2017
$100.00
$100.00
$100.00
$100.00

March 31,
2018
$102.76
$113.99
$136.49
$135.34

March 30,
2019
$104.62
$124.82
$143.09
$133.28

March 28,
2020
$117.69
$116.11
$152.66
$139.93

April 3,
2021

April 2,
2022

$281.36 $177.23
$181.54 $209.94
$269.43 $343.53
$272.10 $324.18

The graph and the table above shall not be deemed “filed” with the SEC for the purpose of Section 18 of the
Exchange Act or otherwise subject to the liabilities of that section, nor shall they be deemed incorporated by
reference in any filings made by us with the SEC, regardless of any general incorporation language in such filing.

24

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

Issuer Purchases of Equity Securities

Period
January 2, 2022 to January 29, 2022
January 30, 2022 to February 26, 2022
February 27, 2022 to April 2, 2022

Total number
of shares
purchased
(in thousands)
284
1,039
1,138

Average
price paid
per share
$140.92
132.89
130.80

Total number of
shares purchased as
part of publicly
announced plans or
programs
(in thousands)
284
1,039
1,138

Approximate dollar value
of shares that may yet
be purchased under the
plans or programs
$1,148.5 million
1,010.5 million
861.7 million

Total

2,461

$132.85

2,461

$ 861.7 million

On May 5, 2021, we announced that our Board of Directors authorized a share repurchase program to repurchase
up to $2.0 billion of our outstanding common stock, which included approximately $236.9 million authorized under
a prior program terminated concurrent with the new authorization. Under this program, share repurchases are made
in accordance with applicable securities laws on the open market or in privately negotiated transactions. The extent
to which we repurchase our shares, the number of shares and the timing of any repurchases depends on general
market conditions, regulatory requirements, alternative investment opportunities and other considerations. The
program does not require us to repurchase a minimum number of shares, does not have a fixed term, and may be
modified, suspended or terminated at any time without prior notice. See Note 16 of the Notes to Consolidated
Financial Statements for further discussion of our share repurchase program.

ITEM 6. [RESERVED]

25

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

ITEM 7. MANAGEMENT’S DISCUSSION AND

ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.

The following discussion should be read in conjunction
with, and is qualified in its entirety by reference to, our
including
audited consolidated financial statements,
the notes thereto, set forth in Part II, Item 8 of this
report.

OVERVIEW

Company
Qorvo® is a global
leader in the development and
commercialization of technologies and products for
wireless, wired and power markets.

We design, develop, manufacture and market our
products to U.S. and international OEMs and ODMs in
two operating segments, MP and IDP, which are also
our reportable segments. MP is a global supplier of
cellular, UWB, Wi-Fi and other wireless solutions for a
variety
smartphones,
wearables, laptops, tablets and IoT. IDP is a global
supplier of RF, SoC and power management solutions
for a wide range of markets, including cellular and IT
infrastructure, automotive, renewable energy, defense
and IoT.

applications,

including

of

In fiscal 2022, the semiconductor industry continued
to experience supply constraints, and we have taken
actions to address short and long-term supply
requirements. During the second quarter ended
October 2, 2021, we entered into a long-term capacity
to reserve
agreement with a foundry
manufacturing supply capacity. Under the agreement
we are required to purchase, and the foundry supplier
is required to supply, a certain number of wafers for
calendar years 2022 through 2025. See Note 11 of
the Notes to Consolidated Financial Statements for
additional information regarding this agreement.

supplier

in

of

the

the

industry

demand,

customer

(including

The COVID-19 pandemic
recent
COVID-19 lockdowns in China) has been a contributing
supply
semiconductor
factor
constraints and may continue to cause volatility and
uncertainty
worldwide
economies and financial markets for an extended
time. To date, any negative impact of
period of
COVID-19 on the overall demand for our products,
cash
capital
liquidity position has been
expenditures and our
limited,
capacity
although we
constraints in our supply chain as described above.
However,
the recent COVID-19 lockdowns in China
could negatively impact the overall demand for our
products, cash flows from operations, need for capital
liquidity position in future
expenditures and our
periods.

from operations,

addressing

flows

need

are

for

26

our

and

Fiscal 2022 Financial Highlights
‰ Revenue increased 15.7% in fiscal 2022 to
$4,645.7 million, compared to $4,015.3 million in
fiscal 2021, driven primarily by higher demand for
our
power
solutions
management, automotive and broadband products,
partially offset by lower demand for our base station
and defense and aerospace products.

5G mobile

‰ Gross margin for fiscal 2022 was 49.2%, compared
to 46.9% in fiscal 2021, primarily due to lower
intangible amortization expense as well as lower unit
costs on higher
volume and productivity. The
increase in gross margin was partially offset by
average selling price erosion.

‰ Operating income was $1,226.1 million in fiscal
2022, compared to $906.6 million in fiscal 2021.
This increase was primarily due to higher revenue
and favorable gross margin, partially offset by higher
operating expenses. Operating expenses increased
primarily due to higher personnel costs, a goodwill
product
and
impairment
development
lower
partially
intangible amortization expense and lower incentive-
based compensation.

increased
offset

charge
spend,

‰ Net income per diluted share was $9.26 for fiscal
2022, compared to net income per diluted share of
$6.32 for fiscal 2021.

‰ Cash flows from operations was $1,049.2 million for
fiscal 2022, compared to $1,301.9 million for fiscal
2021. This year-over-year decrease was primarily
due to increased inventory as well as prepayments
of certain fees and deposits associated with a long-
term capacity reservation agreement. The increased
inventory related to the lower demand for 5G
handsets from China-based OEMs and the build of
inventory
in anticipation of certain customers’
product ramps.

‰ Capital expenditures were $213.5 million in fiscal
2022, compared to $187.0 million in fiscal 2021.
Our capital expenditures in fiscal 2022 included
investments in premium filter capacity.

‰ We completed the acquisitions of NextInput and
United SiC for a total of $389.1 million, net of cash
acquired.

by

‰ We recorded a $48.0 million goodwill

impairment

charge associated with the NextInput acquisition.
‰ We issued $500.0 million aggregate principal
amount of 1.750% senior notes due 2024 (the
“2024 Notes”).

‰ We repaid $197.5 million on the 2020 Term Loan
(as defined below), plus accrued and unpaid
interest.

‰ We repurchased approximately 7.3 million shares of
approximately
stock

for

our
common
$1,152.3 million.

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

RESULTS OF OPERATIONS

Consolidated
The table below presents a summary of our results of operations for fiscal years 2022 and 2021 along with a year-
over-year comparison. See Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and
Results of Operations” of our Annual Report on Form 10-K for the fiscal year ended April 3, 2021, filed with the
SEC on May 24, 2021, which is incorporated by reference herein, for a summary of our results of operations for the
fiscal year ended March 28, 2020 along with a year-over-year comparison between fiscal years 2021 and 2020.

(In thousands, except percentages)
Revenue

Cost of goods sold

Gross profit

Research and development
Selling, general and administrative
Other operating expense

Fiscal 2022

Fiscal 2021

Increase (Decrease)

Dollars

% of
Revenue

Dollars

% of
Revenue

Dollars

Percentage
Change

$4,645,714
2,359,546

100.0% $4,015,307
2,131,741

50.8

100.0% $630,407
227,805

53.1

15.7%
10.7

2,286,168
623,636
349,718
86,745

49.2
13.4
7.5
1.9

1,883,566
570,395
367,238
39,306

46.9
14.2
9.1
1.0

402,602
53,241
(17,520)
47,439

21.4
9.3
(4.8)
120.7

Operating income

$1,226,069

26.4% $ 906,627

22.6% $319,442

35.2%

REVENUE

Revenue increased primarily due to higher demand for
our 5G mobile solutions and our power management,
automotive and broadband products, partially offset by
lower demand for our base station and defense and
aerospace products. The higher demand for our mobile
solutions was driven by 5G content increases with our
largest customers, and the increased demand for our
power management products was driven by
the
migration to smaller and more efficient power
solutions. The increased demand for our automotive
and broadband products was driven by the proliferation
of connected devices and the increasing requirements
for higher efficiency, greater throughput and smaller
size. The lower demand for our base station products
was attributed to fewer 5G massive Multiple-Input/
Multiple-Output (“mMIMO”) deployments in China, and
the lower demand for our defense and aerospace
products was due to the timing of programs.

sales

through

to multiple

We provided our products to our largest end customer
(Apple)
contract
manufacturers, which in the aggregate accounted for
approximately 33% and 30% of total revenue in fiscal
respectively. Samsung
years 2022 and 2021,
accounted for approximately 11% and 7% of
total
revenue in fiscal years 2022 and 2021, respectively.
These customers primarily purchase RF solutions for a
variety of mobile devices.

International shipments amounted to $2,717.3 million
in fiscal 2022 (approximately 58% of
revenue)
compared to $2,384.2 million in fiscal 2021
(approximately 59% of revenue). Shipments to Asia

totaled $2,465.7 million in fiscal 2022 (approximately
revenue) compared to $2,191.2 million in
53% of
fiscal 2021 (approximately 55% of revenue).

GROSS MARGIN

Gross margin increased primarily due to lower intangible
amortization expense as well as lower unit costs on
higher volume and productivity. The increase in gross
margin was partially offset by average selling price
erosion.

OPERATING EXPENSES

Research and Development
R&D spending increased primarily due to additional
headcount and higher design and development costs
associated with our UWB solutions, biotechnology
testing solutions and 5G mobile solutions as well as the
acquisition of United SiC. These increases were partially
offset by lower incentive-based compensation.

Selling, General and Administrative
Selling, general and administrative expense decreased
primarily due to lower intangible amortization expense
and lower
These
decreases were partially offset by higher personnel
and commission expenses.

incentive-based compensation.

Other Operating Expense
Other operating expense increased in fiscal 2022
primarily due to a goodwill
impairment charge of
$48.0 million. See Note 6 of the Notes to Consolidated
Financial Statements for additional information.

27

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

Operating Segments

Mobile Products

(In thousands, except percentages)
Revenue
Operating income
Operating income as a % of revenue

Fiscal Year

Increase

2022

2021

Dollars

Percentage
Change

$3,545,253 $2,856,813
1,008,171

1,290,132

$688,440
281,961

24.1%
28.0

36.4%

35.3%

MP revenue increased primarily due to higher demand for our mobile solutions driven by 5G content increases with
our largest customers.

MP operating income increased primarily due to the effects of increased revenue and lower unit costs on higher
volume and productivity. These increases were partially offset by average selling price erosion and higher operating
expenses. Operating expenses increased primarily due to additional headcount and higher design and development
costs associated with our UWB solutions and 5G mobile solutions as well as the acquisition of NextInput. These
increases were partially offset by lower incentive-based compensation.

Infrastructure and Defense Products

(In thousands, except percentages)
Revenue
Operating income
Operating income as a % of revenue

Fiscal Year

Decrease

2022

2021

Dollars

$1,100,461 $1,158,494 $(58,033)
(21,996)

261,511

283,507

23.8%

24.5%

Percentage
Change

(5.0)%
(7.8)

IDP revenue decreased primarily due to lower demand for our base station and defense and aerospace products,
partially offset by increased demand for our power management, automotive and broadband products. The lower
demand for our base station products was attributed to fewer 5G mMIMO deployments in China, and the lower
demand for our defense and aerospace products was due to the timing of programs. The increased demand for our
power management products was driven by the migration to smaller and more efficient power solutions. The
increased demand for our automotive and broadband products was driven by the proliferation of connected devices
and the increasing requirements for higher efficiency, greater throughput and smaller size.

IDP operating income decreased primarily due to decreased revenue and higher operating expenses, partially offset
by favorable changes in gross margin. Operating expenses increased primarily due to increased expenses
associated with the design and development of our biotechnology testing solutions as well as the acquisition of
United SiC, partially offset by lower incentive-based compensation. Gross margin was favorable primarily due to
improved product mix, average selling price expansion and lower costs from improved factory utilization.

See Note 17 of the Notes to Consolidated Financial Statements for a reconciliation of segment operating income to
the consolidated operating income for fiscal years 2022, 2021 and 2020.

28

INTEREST, OTHER INCOME (EXPENSE) AND INCOME
TAXES

domestic tax credits. For fiscal 2021, this resulted in
an annual effective tax rate of 9.1%.

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

Fiscal Year

2022

2021

(In thousands)
Interest expense
Other income (expense), net
Income tax expense

$ (63,326) $(75,198)
(24,049)
(73,769)

18,341
(147,731)

Interest expense
During fiscal 2022, we recorded interest expense
primarily related to our 4.375% senior notes due 2029
(the “2029 Notes”) and our 3.375% senior notes due
2031 (the “2031 Notes”). During fiscal 2021, we
recorded interest expense primarily related to our
5.50% senior notes due July 15, 2026 (the “2026
Notes”),
the 2029 Notes and the 2031 Notes.
Interest expense in the preceding table for fiscal years
2022 and 2021 is net of capitalized interest of
$3.7 million and $4.1 million, respectively.

Other income (expense), net
Other income (expense) includes realized or unrealized
gains and losses from investments, interest income,
foreign currency
changes and losses on debt
extinguishments.

During fiscal 2022, we recorded $12.0 million of
income based on our share of the earnings from our
limited partnership investments, and we recorded net
gains of $2.7 million from other investments.

During fiscal 2021, we recorded $21.5 million of
income based on our share of the earnings from our
limited partnership investments, and we recorded net
gains of $9.1 million from other
In
addition, we recognized a loss on debt extinguishment
of $62.0 million primarily related to the redemption of
our 2026 Notes on October 16, 2020.

investments.

A valuation allowance has been established against
deferred tax assets in the taxing jurisdictions where,
based upon the positive and negative evidence
available, it is more likely than not that the related
deferred tax assets will not be realized. Realization is
dependent upon generating future income in the taxing
jurisdictions in which the operating loss carryovers,
credit carryovers, depreciable tax basis and other
deferred tax assets exist. Management reevaluates
the ability to realize the benefit of these deferred tax
assets on a quarterly basis. As of the end of fiscal
years 2022 and 2021,
the valuation allowance
against domestic and foreign deferred tax assets was
$36.3 million and $36.5 million, respectively.

See Note 13 of the Notes to Consolidated Financial
Statements
regarding
income taxes.

information

additional

for

STOCK-BASED COMPENSATION

Under Accounting Standards Codification (“ASC”) 718,
“Compensation – Stock Compensation,” stock-based
compensation cost is measured at the grant date,
based on the estimated fair value of the award using
an option pricing model
for stock options (Black-
Scholes) and market price for restricted stock units,
and is recognized as expense over the employee’s
requisite service period.

total

remaining unearned
As of April 2, 2022,
related to unvested restricted
compensation cost
stock units was $121.0 million, which will be
amortized over the weighted-average remaining service
period of approximately 1.2 years.

LIQUIDITY AND CAPITAL RESOURCES

for

tax

fiscal

2022

expense

Income tax expense
Income
was
$147.7 million. This was primarily comprised of tax
expense related to domestic and international
operations generating pre-tax book income (exclusive
of nondeductible expenses associated with acquisition
related adjustments), the impact of the Tax Act’s GILTI
provisions and an increase in gross unrecognized tax
benefits, offset by a tax benefit related to international
operations
losses and
generating pre-tax book
domestic tax credits. For fiscal 2022, this resulted in
an annual effective tax rate of 12.5%.

Income tax expense for fiscal 2021 was $73.8 million.
This was primarily comprised of tax expense related to
international operations
generating pre-tax book
income, the impact of the Tax Act’s GILTI provisions,
the reversal of the permanent reinvestment assertion
with regards to certain unrepatriated foreign earnings
and an increase in gross unrecognized tax benefits,
related to international
offset by a tax benefit
losses and
operations

generating pre-tax book

Cash generated by operations is our primary source of
liquidity. As of April 2, 2022, we had working capital of
including
approximately
$972.6 million in cash and cash equivalents,
compared
approximately
$1,802.2 million, including $1,397.9 million in cash
and cash equivalents, as of April 3, 2021.

to working

$1,774.7

million,

capital

of

Our $972.6 million of total cash and cash equivalents
as of April 2, 2022, includes $831.8 million held by
our foreign subsidiaries, of which $709.5 million is
held by Qorvo International Pte. Ltd. in Singapore. If
the undistributed earnings of our foreign subsidiaries
are needed in the U.S., we may be required to pay
state income and/or foreign local withholding taxes to
repatriate these earnings.

Credit Agreement
On September 29, 2020, we and certain of our U.S.
subsidiaries (the “Guarantors”) entered into a five-year
unsecured senior credit facility pursuant to a credit
restated, modified or
agreement

(as amended,

29

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

as

credit

dated

previous

agreement

otherwise supplemented from time to time, the “2020
Credit Agreement”) with Bank of America, N.A., acting
as administrative agent, and a syndicate of lenders.
The 2020 Credit Agreement amended and restated
the
of
December 5, 2017 (the “2017 Credit Agreement”).
The 2020 Credit Agreement included a senior term
loan (the “2020 Term Loan”) of $200.0 million and a
senior revolving line of credit (the “Revolving Facility”)
of up to $300.0 million (collectively the “Credit
a
Facility”).
$25.0 million sublimit for the issuance of standby
letters of credit and a $10.0 million sublimit for swing
line loans. The Credit Facility is available to finance
working capital, capital expenditures and other general
corporate purposes.

Revolving

includes

Facility

The

Pursuant
to the 2020 Credit Agreement, we may
request one or more additional tranches of term loans
increases to the Revolving Facility, up to an
or
aggregate of $500.0 million and subject to, among
other things, securing additional funding commitments
from the existing or new lenders.

During fiscal 2022, there were no borrowings under
the Revolving Facility.

During fiscal 2021, we made principal payments
totaling $2.5 million on the term loan under the 2017
Credit Agreement (the “2017 Term Loan”). On the
closing date of the 2020 Credit Agreement, we repaid
the remaining principal balance of $97.5 million on
the 2017 Term Loan
drew
$200.0 million under the 2020 Term Loan.

concurrently

and

During fiscal 2021, we made principal payments
totaling $2.5 million on the 2020 Term Loan, and
during fiscal 2022, we repaid the remaining principal
balance of $197.5 million on the 2020 Term Loan.

contains

The 2020 Credit
various
Agreement
conditions, covenants and representations with which
we must be in compliance in order to borrow funds
and to avoid an event of default. As of April 2, 2022,
we were in compliance with these covenants. See
Note 9 of
the Notes to Consolidated Financial
Statements for further information about the Credit
Agreement, including applicable interest rates.

Stock Repurchases
On October 31, 2019, we announced that our Board
of Directors authorized a share repurchase program to
repurchase up to $1.0 billion of our outstanding
approximately
common
$117.0 million authorized under a prior program which
was terminated concurrent with this authorization.

included

stock,

which

On May 5, 2021, we announced that our Board of
Directors authorized a new share repurchase program
to repurchase up to $2.0 billion of our outstanding
approximately
common
stock,
$236.9 million
program
the
announced on October 31, 2019, which was
terminated concurrent with the new authorization. As

which
authorized

included
under

30

of April 2, 2022,
availability under the share repurchase program.

there was $861.7 million of

Under our share repurchase programs, repurchases
are made in accordance with applicable securities
laws on the open market or in privately negotiated
transactions. The extent to which we repurchase our
shares, the number of shares and the timing of any
repurchases depends on general market conditions,
regulatory
investment
opportunities and other considerations. The current
program does not require us to repurchase a minimum
number of shares, does not have a fixed term, and
may be modified, suspended or terminated at any time
without prior notice.

requirements,

alternative

We repurchased 7.3 million shares, 3.6 million shares
and 6.4 million shares of our common stock during
fiscal years 2022, 2021 and 2020, respectively, at an
aggregate cost of $1,152.3 million, $515.1 million
and $515.1 million, respectively.

Cash Flows from Operating Activities
Operating activities in fiscal 2022 generated cash of
$1,049.2 million, compared to $1,301.9 million in
fiscal 2021. This decrease in cash provided by
operating activities was primarily due to increased
inventory as well as prepayments of certain fees and
deposits
long-term capacity
inventory
reservation
related to the lower demand for 5G handsets from
inventory in
China-based OEMs and the build of
anticipation of certain customers’ product
ramps.
These decreases to cash provided by operating
activities were partially offset by increased profitability
as a result of demand and revenue growth.

associated with
agreement.

increased

The

a

Cash Flows from Investing Activities
Net cash used in investing activities in fiscal 2022
was $596.0 million, compared to $218.7 million in
fiscal 2021. This increase in cash used in investing
activities was primarily due to the acquisitions of
NextInput and United SiC in fiscal 2022, which
resulted in net cash outflows of $389.1 million, as
compared to the acquisition of 7Hugs Labs S.A.S. in
fiscal 2021, which resulted in net cash outflows of
$47.7 million. See Note 5 of
the Notes to
Consolidated Financial Statements for additional
information regarding our business acquisitions.

Cash Flows from Financing Activities
Net cash used in financing activities in fiscal 2022
was $875.5 million, compared to $401.9 million in
fiscal 2021. This increase in cash used in financing
activities was primarily due to stock repurchases. See
the Notes to Consolidated Financial
Note 16 of
information regarding our
Statements for additional
stock repurchases.

Our future capital requirements may differ materially
from those currently anticipated and will depend on
including market acceptance of and
many factors,

demand for our products, acquisition opportunities,
relationships with
technological advances and our
suppliers and customers. Based on current and
projected levels of cash flows from operations,
coupled with our existing cash and cash equivalents
and our Credit Facility, we believe that we have
sufficient liquidity to meet both our short-term and
long-term cash requirements. However, if there is a
significant decrease in demand for our products, or if
our revenue grows faster than we anticipate, operating

CONTRACTUAL OBLIGATIONS

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

cash flows may be insufficient to meet our needs. If
existing resources and cash from operations are not
sufficient to meet our future requirements or if we
perceive conditions to be favorable, we may seek
additional debt or equity financing. Additional debt or
equity financing could be dilutive to holders of our
common stock. Further, we cannot be sure that
additional debt or equity financing, if required, will be
available on favorable terms, if at all.

The following table summarizes our significant contractual obligations and commitments (in thousands) as of
April 2, 2022, and the effect such obligations are expected to have on our liquidity and cash flows in future
periods.

Capital commitments (1)
Purchase obligations (2)
Leases
Long-term debt obligations (3)

Payments Due By Fiscal Period

Total
Payments

2023

2024-2025

2026-2027

$ 137,176 $ 116,482 $

20,694 $

— $

2,019,516
104,886
2,586,399

902,162
20,839
69,587

880,450
30,581
627,313

236,904
22,062
133,437

2028 and
thereafter

—
—
31,404
1,756,062

Total

$4,847,977 $1,109,070 $1,559,038 $392,403 $1,787,466

(1) Capital commitments represent obligations for the purchase of property and equipment, a majority of which are not recorded as

liabilities on our Consolidated Balance Sheet because we had not received the related goods or services as of April 2, 2022.

(2) Purchase obligations represent payments due related to the purchase of materials and manufacturing services, a majority of which
are not recorded as liabilities on our Consolidated Balance Sheet because we had not received the related goods or services as of
April 2, 2022. See Note 11 of the Notes to Consolidated Financial Statements for further information.

(3) Long-term debt obligations represent future cash payments of principal and interest over the life of the 2024 Notes, the 2029 Notes
and the 2031 Notes, including anticipated interest payments not recorded as liabilities on our Consolidated Balance Sheet as of
April 2, 2022. Debt obligations are classified based on their stated maturity date, and any future redemptions would impact our cash
payments. See Note 9 of the Notes to Consolidated Financial Statements for further information.

Other Contractual Obligations
As of April 2, 2022, in addition to the amounts shown
in the contractual obligations table above, we have
$13.8 million of unrecognized income tax benefits and
accrued interest and penalties which has been
recorded as a liability. We are uncertain as to if, or
when, such amounts may be settled. We also have an
obligation related to the Transitional Repatriation Tax
that we elected to pay over eight years which has
been recorded as a liability. The remaining obligation
of $5.4 million is to be paid over the next four years.

As discussed in Note 10 of the Notes to Consolidated
Financial Statements, we have two pension plans in
Germany with a combined benefit obligation of
approximately $12.1 million as of April 2, 2022.
Pension benefit payments are not
included in the
schedule above due to the uncertainty regarding the
amount and timing of any future cash outflows.
approximately
Pension
$0.3 million in fiscal 2022 and are expected to be
approximately $0.3 million in fiscal 2023.

payments were

benefit

We also offer a non-qualified deferred compensation
plan to eligible participants to defer and invest a

an

for

the

plan

under

obligation

specified percentage of their cash compensation. We
the
record
distributions to be made to participants upon certain
triggering events. Although participants are required to
make distribution elections at the time of enrollment,
the amount and timing of any future cash outflows is
uncertain until such triggering events occur. The total
deferred compensation obligation as of April 2, 2022
was $39.4 million, of which $1.5 million is estimated
to be paid in fiscal 2023. See Note 10 of the Notes to
further
Consolidated
information.

Statements

Financial

for

SUPPLEMENTAL PARENT AND GUARANTOR
FINANCIAL INFORMATION

In accordance with the indentures governing the 2024
Notes, the 2029 Notes and the 2031 Notes (together,
the “Notes”), our obligations under the Notes are fully
and unconditionally guaranteed on a joint and several
unsecured basis by the Guarantors, which are listed
on Exhibit 22 to this Annual Report on Form 10-K.
Each Guarantor is 100% owned, directly or indirectly,
by Qorvo, Inc. (“Parent”). A Guarantor can be released
in certain customary circumstances. Our other U.S.

31

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

subsidiaries and our non-U.S. subsidiaries do not
guarantee the Notes (such subsidiaries are referred to
as the “Non-Guarantors”).

following

presents

summarized

The
financial
information for the Parent and the Guarantors on a
combined basis as of and for the periods indicated,
after eliminating (i)
intercompany transactions and
balances among the Parent and Guarantors, and
(ii) equity earnings from, and investments in, any
Non-Guarantor. The summarized financial information
may not necessarily be indicative of
the financial
position and results of operations had the combined
Parent and Guarantors operated independently from
the Non-Guarantors.

Summarized Balance Sheets

(in thousands)
ASSETS
Current assets (1)
Non-current assets
LIABILITIES
Current liabilities
Long-term liabilities (2)

April 2, 2022

April 3, 2021

$ 771,528 $1,143,086
$2,624,454 $2,450,960

$ 241,674 $ 240,943
$2,634,501 $2,250,666

(1) Includes net amounts due from Non-Guarantor subsidiaries
of $286.8 million and $532.4 million as of April 2, 2022 and
April 3, 2021, respectively.

(2) Includes net amounts due to Non-Guarantor subsidiaries of
$433.5 million and $395.3 million as of April 2, 2022 and
April 3, 2021, respectively.

Summarized Statement of Income

(in thousands)
Revenue
Gross profit
Net loss

Fiscal Year 2022

$1,126,193
$ 268,025
$ (93,405)

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The preparation of consolidated financial statements
requires management to use judgment and estimates.
The level of uncertainty in estimates and assumptions
increases with the length of time until the underlying
transactions are completed. Actual
results could
materially differ from those estimates. The accounting
policies that are most critical in the preparation of our
consolidated financial statements are those that are
both important to the presentation of our financial
condition and results of operations and require
judgment and estimates on the part of
significant
management. Our critical accounting policies are
reviewed periodically with the Audit Committee of the
Board of Directors. We also have other policies that
we consider key accounting policies; however, these
policies typically do not require us to make estimates
or judgments that are difficult or subjective. See Note
1 of the Notes to Consolidated Financial Statements.

32

Inventory Reserves. The valuation of inventory requires
us to estimate obsolete or excess inventory. The
determination of obsolete or excess inventory requires
us to estimate the future demand for our products
within specific time horizons, generally 12 to 24
months. The estimates of future demand that we use
in the valuation of inventory reserves are the same as
those used in our revenue forecasts and are also
consistent with
our
manufacturing plans to enable consistency between
inventory valuations and build decisions. Product-
specific facts and circumstances reviewed in the
inventory valuation process include a review of the
customer base, market conditions and customer
acceptance of our products and technologies, as well
as an assessment of the selling price in relation to
the product cost.

estimates

used

the

in

Historically, inventory reserves have fluctuated as new
technologies have been introduced and customers’
demand has shifted. Inventory reserves had an impact
on margins of less than 2% in fiscal years 2022 and
2021.

Property and Equipment. Periodically, we evaluate the
period over which we expect to recover the economic
value of our property and equipment, considering
factors such as changes in machinery and equipment
technology, our ability to re-use equipment across
generations of process technology and historical
usage trends. When we determine that the useful lives
of assets are shorter or longer than we had originally
estimated, we adjust the rate of depreciation to reflect
the revised useful lives of the assets.

We assess property and equipment for impairment
when events or changes in circumstances indicate
that the carrying value of the assets or the asset
group may not be recoverable. Factors that we
consider in deciding when to perform an impairment
review include an adverse change in our use of the
assets or an expectation that the assets will be sold
or otherwise disposed. We assess the recoverability of
the assets held and used by comparing the projected
undiscounted net cash flows associated with the
related asset or group of assets over their remaining
estimated useful lives against their respective carrying
amounts. Assets identified as “held for sale” are
recorded at the lesser of their carrying value or their
fair market value less costs to sell. Impairment, if any,
is based on the excess of the carrying amount over
the fair value of
those assets. The process of
evaluating property and equipment for impairment is
highly subjective and requires significant judgment as
we are required to make assumptions about items
such as future demand for our products and industry
trends.

Business Acquisitions. We allocate the fair value of the
purchase price to the assets acquired and liabilities
assumed based on their estimated fair value. The
excess of the purchase price over the fair values of
is
the

identifiable

liabilities

assets

and

recorded to goodwill. Goodwill
is assigned to the
reporting unit that is expected to benefit from the
synergies of the business combination.

A number of assumptions, estimates and judgments
are used in determining the fair value of acquired
assets and liabilities, particularly with respect to the
intangible assets acquired. The valuation of intangible
assets requires the use of valuation techniques such
as the income approach. The income approach
future cash
includes management’s estimation of
flows (including expected revenue growth rates and
profitability), the underlying product or technology life
cycles and the discount rates applied to future cash
flows.

Judgment is also required in estimating the fair values
of deferred tax assets and liabilities, uncertain tax
positions and tax-related valuation allowances, which
are initially estimated as of the acquisition date, as
well as inventory, property and equipment, pre-existing
liabilities or
legal claims, deferred revenue and
contingent consideration, each as may be applicable.

While we use our best estimates and assumptions to
value assets acquired and liabilities
accurately
assumed at the acquisition date as well as contingent
consideration, where applicable, our estimates are
inherently uncertain and subject to refinement. As a
result, during the measurement period, which may be
up to one year from the acquisition date, we may
record adjustments to the assets acquired and
liabilities assumed with the corresponding offset to
goodwill. After the measurement period, any purchase
price adjustments are recognized in our Consolidated
Statements of Income.

Impairment Testing.

Goodwill
In accordance with ASC
350, “Intangibles—Goodwill and Other” (“ASC 350”),
is not amortized, but rather is reviewed for
goodwill
impairment at the reporting unit level on the first day
of our fourth quarter of each fiscal year, or when there
is evidence that events or changes in circumstances
indicate that the carrying amount of the goodwill may
not be recovered.

Under ASC 350, we have the option to first assess
qualitatively whether it is more likely than not that the
fair value of a reporting unit is less than its carrying
amount, including goodwill.

We establish our reporting units based on our current
organizational
structure, product and technology
characteristics and segment management’s view of
the business. As of January 2, 2022, we identified
three reporting units within the MP operating segment
and two reporting units within the IDP operating
segment, and we performed the optional qualitative
assessment to determine whether the existence of
events or circumstances indicated that it was more
likely than not that the fair value of each reporting unit
was less than its respective carrying value.

In performing qualitative assessments, we consider
(i) our overall historical and projected future operating

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

results, (ii) if there was a significant decline in our
stock price for a sustained period, (iii) if there was a
significant change in our market capitalization relative
to our net book value, and (iv) if there was a prolonged
or more significant slowdown in the worldwide
economy of the semiconductor industry, as well as
other
relevant events and factors affecting the
reporting unit.

that

their

related

carrying

exceeded

four of our five reporting units’

In fiscal 2022, we completed our annual qualitative
assessments and concluded that based on the
relevant events and circumstances, it was more likely
than not
fair
values
values.
However,
for one of our MP reporting units (the
acquired NextInput business), it was determined that
the market adoption of the acquired technology into
mobile handsets is expected to be delayed compared
to
Therefore, we
determined that it was more likely than not that the
fair value of
the reporting unit was less than its
carrying amount, and we performed a quantitative
assessment to calculate the fair value of the reporting
unit.

assumptions.

previous

the

Our quantitative assessment considered both the
income and market approaches to estimate the fair
value of the reporting unit. The income approach is
based on the discounted cash flow method that uses
the reporting unit’s forecasted future
estimates of
financial performance including revenues, operating
taxes and capital expenditures. These
expenses,
estimates are developed as part of our
long-term
planning process based on assumed market segment
growth rates and our assumed market segment share,
estimated costs based on historical data and various
internal estimates. Projected cash flows are then
discounted to a present value employing a discount
rate that properly accounts for the estimated market
weighted-average cost of capital, as well as any risk
unique to the cash flows. The market approach is
based on financial multiples (i.e., multiples of revenue
or earnings before income taxes, depreciation and
amortization) of comparable companies.

Based on the quantitative assessment performed, we
determined that the carrying amount of the reporting
unit exceeded its fair value, which resulted in a
goodwill
approximately
impairment charge is
$48.0 million. The goodwill
recorded in “Other operating expense”
in the
Statement of Income for the fiscal year ended April 2,
2022.

impairment

charge

of

Inherent in the fair value determination are significant
judgments and estimates,
including assumptions
about our future revenue, profitability and cash flows,
our operational plans and our interpretation of current
economic indicators and market valuations. To the
extent these assumptions are incorrect or there are
further declines in our business outlook, additional
goodwill impairment charges may be recorded in future
periods.

33

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

In fiscal 2021, we completed qualitative assessments
and concluded that based on the relevant events and
circumstances, it was more likely than not that each
of the reporting unit’s fair value exceeded its related
carrying value, and no further impairment testing was
required.

Identified Intangible Assets. We amortize definite-lived
intangible assets (including developed technology,
customer relationships, technology licenses, backlog
lives.
and trade names) over their estimated useful
In-process research and development (“IPRD”) assets
represent the fair value of incomplete R&D projects
that had not reached technological feasibility as of the
date of the acquisition; initially, these are classified
as IPRD and are not subject to amortization. Upon
completion
are
transferred to developed technology and are amortized
over their useful lives. The asset balances relating to
abandoned projects are impaired and expensed to
R&D.

IPRD assets

development,

of

indicate that

We evaluate definite-lived intangible assets for
impairment
in accordance with ASC 360-10-35,
“Impairment or Disposal of Long-Lived Assets” to
determine whether facts and circumstances (including
external factors such as industry and economic trends
and internal factors such as changes in our business
strategy and forecasts)
the carrying
amount of the assets may not be recoverable. If such
facts and circumstances exist, we assess the
recoverability of
identified intangible assets by
comparing the projected undiscounted net cash flows
associated with the related asset or group of assets
over
respective
carrying amounts. Impairments, if any, are based on
the excess of the carrying amounts over the fair value
of those assets and occur in the period in which the
impairment determination was made.

remaining lives against

their

their

In connection with completing our fiscal 2022 annual
goodwill
impairment assessment, we also evaluated
our long-lived intangible assets and determined that
the forecasted undiscounted net cash flows related to
these assets were in excess of their carrying values.
No definite-lived intangible asset impairment charges
were recorded for fiscal years 2022 or 2021.

Revenue Recognition. We generate revenue primarily
from the sale of semiconductor products, either
directly to a customer or
to a distributor, or at
completion of a consignment process. Revenue is
recognized when control of the promised goods or
services is transferred to our customers, in an amount
that reflects the consideration we expect to be entitled
in exchange for those goods or services. A majority of
our revenue is recognized at a point in time, either on
shipment or delivery of the product, depending on
individual customer terms and conditions. Revenue
from sales to our distributors is recognized upon
shipment of the product to the distributors (sell-in).
consignment
Revenue
programs at a point in time when the products are

recognized

from our

is

34

from Contracts with Customers,”

pulled from consignment inventory by the customer.
Revenue recognized for products and services over-
time is immaterial (less than 3% of overall revenue).
We apply a five-step approach as defined in ASC 606,
“Revenue
in
determining the amount and timing of revenue to be
recognized:
the contract with a
customer; (2) identifying the performance obligations
in the contract; (3) determining the transaction price;
(4) allocating the transaction price to the performance
obligations in the contract; and (5) recognizing revenue
when the corresponding performance obligation is
satisfied.

identifying

(1)

Sales agreements are in place with certain customers
to
and contain terms and conditions with respect
payment, delivery, warranty and supply, but typically do
not require minimum purchase commitments. In the
absence of a sales agreement, our standard terms
and conditions apply. We consider a customer’s
purchase order, which is governed by a sales
agreement or our standard terms and conditions, to
be the contract with the customer.

to

or

determine

likely amount of consideration we expect

Our pricing terms are negotiated independently, on a
stand-alone basis.
In determining the transaction
price, we evaluate whether the price is subject to a
the
refund
net
adjustment
consideration to which we expect
to be entitled.
Variable consideration in the form of rebate programs
is offered to certain customers, including distributors,
and represents less than 7% of net
revenue. We
determine variable consideration by estimating the
to
most
receive from the customer. Our terms and conditions
do not give our customers a right of return associated
with the original sale of our products. However, we
may
certain
circumstances, which include courtesy returns and
like-kind exchanges. We reduce revenue and record
reserves for product returns and allowances, rebate
programs and scrap allowance based on historical
experience or specific identification depending on the
contractual terms of the arrangement.

authorize

returns

under

sales

Our accounts receivable balance is from contracts with
customers and represents our unconditional right to
receive consideration from our customers. Payments
are due upon completion of
the performance
obligation and subsequent invoicing. Substantially all
payments are collected within our standard terms,
which do not include any financing components. To
date, there have been no material impairment losses
on accounts receivable. Contract assets and contract
liabilities recorded on the Consolidated Balance
Sheets were immaterial as of April 2, 2022 and
April 3, 2021.

We invoice customers upon shipment and recognize
revenues in accordance with delivery terms. As of
April 2, 2022, we had $424.7 million in remaining
unsatisfied performance obligations with an original
duration greater than one year, of which the majority is

expected to be recognized as income over the next 12
months.

We include shipping charges billed to customers in
“Revenue” and include the related shipping costs in
“Cost of goods sold” in the Consolidated Statements
of Income. Taxes assessed by government authorities
on revenue-producing transactions,
including tariffs,
value-added and excise taxes, are excluded from
revenue in the Consolidated Statements of Income.

contracts

customers.

We incur commission expense that is incremental to
obtaining
Sales
with
commissions (which are recorded in the “Selling,
general and administrative” expense line item in the
Income) are expensed
Consolidated Statements of
when incurred because such commissions are not
owed until
the performance obligation is satisfied,
which coincides with the end of the contract term;
therefore, no remaining period exists over which to
amortize the commissions.

In determining income for

Income Taxes.
financial
statement purposes, we must make certain estimates
and judgments in the calculation of tax expense, the
liabilities and the recoverability of
resultant
deferred tax assets that arise from temporary
differences between the tax and financial statement
recognition of revenue and expense.

tax

As part of our financial process, we assess on a tax
jurisdictional basis the likelihood that our deferred tax
assets can be recovered. If recovery is not more likely
than not (a likelihood of less than 50 percent), the
provision for taxes must be increased by recording a
reserve in the form of a valuation allowance for the
deferred tax assets that are estimated not
to
ultimately be recoverable.
In this process, certain
relevant criteria are evaluated including: the amount of
income or loss in prior years, the existence of deferred
tax liabilities that can be used to absorb deferred tax
assets, the taxable income in prior carryback years
that can be used to absorb net operating losses and
credit carrybacks, future expected taxable income and
prudent and feasible tax planning strategies. Changes
in taxable income, market
conditions, U.S. or
international tax laws and other factors may change
our judgment regarding whether we will be able to
realize the deferred tax assets. These changes, if any,
may require material adjustments to the net deferred
tax assets and an accompanying reduction or increase
in income tax expense which will
in a
corresponding increase or decrease in net income in
the period when such determinations are made. See
the Notes to Consolidated Financial
Note 13 of
Statements
regarding
for
changes in the valuation allowance and net deferred
tax assets.

information

additional

result

As part of our financial process, we also assess the
likelihood that our
reporting positions will
ultimately be sustained. To the extent it is determined
it is more likely than not (a likelihood of more than 50
percent) that some portion, or all, of a tax reporting

tax

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

tax

position will ultimately not be recognized and
sustained, a provision for unrecognized tax benefit is
provided by either reducing the applicable deferred tax
asset or accruing an income tax liability. Our judgment
regarding the sustainability of our
reporting
positions may change in the future due to changes in
U.S. or international tax laws and other factors. These
changes, if any, may require material adjustments to
the related deferred tax assets or accrued income tax
liabilities and an accompanying reduction or increase
in a
in income tax expense which will
corresponding increase or decrease in net income in
the period when such determinations are made. See
the Notes to Consolidated Financial
Note 13 of
information regarding our
Statements for additional
uncertain
of
positions
tax
unrecognized tax benefits.

amount

result

and

the

ITEM 7A. QUANTITATIVE AND QUALITATIVE

DISCLOSURES ABOUT MARKET RISK.

Financial Risk Management
The primary objective of our financial risk management
activities is to reduce the negative financial
impact
foreign
rates,
resulting from changes in interest
currency exchange rates, equity prices and commodity
prices (the “Underlying Exposures”). We manage these
Underlying Exposures through operational means as
financial
well as
instruments when deemed appropriate. The method
and extent to which we are able to reduce the financial
impact related to the Underlying Exposures may vary
over time. Similarly, there can be no assurance that
risk management activities will be
our
successful in mitigating the financial impact resulting
from movements in the Underlying Exposures.

through the use of

financial

various

Interest Rate Risk
We may be exposed to interest rate risk via the terms
of our Credit Facility. If the Credit Facility were to be
drawn (through a term loan or our Revolving Facility), it
would bear interest at a variable rate. See Note 9 of
the Notes to Consolidated Financial Statements for
further information. As of April 2, 2022, we did not
have any outstanding borrowings under
the Credit
Facility.

Foreign Currency Exchange Rate Risk
As a global company, our
results are affected by
movements in currency exchange rates. Our exposure
may increase or decrease over time as our foreign
business levels fluctuate in the countries where we
have operations, and these changes could have a
material impact on our financial results. The functional
currency for most of our international operations is the
U.S. dollar. We have foreign operations in Asia,
Central America and Europe, and a substantial portion
of our revenue is derived from sales to customers
outside the U.S. Our international revenue is primarily
denominated in U.S. dollars. Operating expenses and
items related to our foreign-
certain working capital

35

2022. If the U.S. dollar increased in value 10% in
currency
re-measured
relation
instruments, our net income would have increased by
approximately $3.6 million in fiscal 2022.

foreign

the

to

Equity Price Risk
Our marketable equity investments in publicly traded
companies are subject to equity market price risk.
Accordingly, a fluctuation in the price of each equity
security could have an adverse impact on the fair
value of our investments. As of April 2, 2022, our
marketable equity investments were immaterial. See
Note 7 of
the Notes to Consolidated Financial
Statements for further information.

commodities. We

Commodity Price Risk
We routinely use precious metals in the manufacture
of our products. Supplies for such commodities may
from time to time become restricted, or general
market factors and conditions may affect the pricing of
such
active
reclamation process to capture any unused gold.
While we attempt to mitigate the risk of increases in
commodities-related costs, there can be no assurance
that we will be able to successfully safeguard against
potential short-term and long-term commodity price
fluctuations.

have

also

an

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

some

based
are,
operations
in
instances,
foreign currencies and
denominated in the local
therefore are affected by changes in the U.S. dollar
exchange rate in relation to foreign currencies, such
as the Costa Rican Colon, Euro, Pound Sterling,
the U.S. dollar
Renminbi, and Singapore Dollar.
weakens compared to these and other currencies, our
operating expenses for
foreign operations will be
higher when remeasured back into U.S. dollars. We
seek to manage our foreign currency exchange risk in
part through operational means.

If

For fiscal 2022, we incurred a foreign currency loss of
$1.5 million as compared to a loss of $3.8 million in
fiscal 2021, which is recorded in “Other
income
(expense), net.”

financial

instrument holdings,

Our
including foreign
receivables, cash and payables at April 2, 2022, were
analyzed to determine their sensitivity to foreign
exchange rate changes. In this sensitivity analysis, we
assumed that
the change in one currency’s rate
relative to the U.S. dollar would not have an effect on
other currencies’ rates relative to the U.S. dollar. All
other factors were held constant. If the U.S. dollar
declined in value 10% in relation to the re-measured
foreign currency instruments, our net income would
have decreased by approximately $4.4 million in fiscal

36

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

ITEM 8.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Balance Sheets

Consolidated Statements of Income

Consolidated Statements of Comprehensive Income

Consolidated Statements of Stockholders’ Equity

Consolidated Statements of Cash Flows

Notes to Consolidated Financial Statements

Reports of Independent Registered Public Accounting Firm PCAOB ID:42

Page

38

39

40

41

42

43

72

37

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

CONSOLIDATED BALANCE SHEETS

(In thousands, except per share data)

ASSETS
Current assets:

April 2, 2022

April 3, 2021

Cash and cash equivalents
Accounts receivable, net of allowance of $402 and $331 as of April 2, 2022 and

$ 972,592 $1,397,880

April 3, 2021, respectively

Inventories
Prepaid expenses
Other receivables
Other current assets

Total current assets
Property and equipment, net
Goodwill
Intangible assets, net
Long-term investments
Other non-current assets

Total assets

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:

Accounts payable
Accrued liabilities
Other current liabilities

Total current liabilities
Long-term debt
Other long-term liabilities

Total liabilities
Commitments and contingent liabilities (Note 11)
Stockholders’ equity:

568,850
755,748
49,839
32,151
70,685

2,449,865
1,253,591
2,775,634
674,786
31,086
324,110

457,431
507,787
41,572
27,324
51,810

2,483,804
1,266,031
2,642,708
611,155
35,370
182,402

$7,509,072 $7,221,470

$ 327,915 $ 313,868
255,060
112,653

240,186
107,026

675,127
2,047,098
233,629

681,581
1,742,550
167,914

2,955,854

2,592,045

Preferred stock, $.0001 par value; 5,000 shares authorized; no shares issued and

outstanding

—

—

Common stock and additional paid-in capital, $.0001 par value; 405,000 shares
authorized; 106,303 and 112,557 shares issued and outstanding at April 2,
2022 and April 3, 2021, respectively
Accumulated other comprehensive income
Retained earnings

Total stockholders’ equity

Total liabilities and stockholders’ equity

4,035,849
5,232
512,137

4,244,740
29,649
355,036

4,553,218

4,629,425

$7,509,072 $7,221,470

See accompanying notes.

38

CONSOLIDATED STATEMENTS OF INCOME

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

(In thousands, except per share data)

Revenue

Cost of goods sold

Gross profit

Operating expenses:

Research and development

Selling, general and administrative

Other operating expense

Total operating expenses

Operating income

Interest expense

Other income (expense), net

Income before income taxes

Income tax expense

Net income

Net income per share:

Basic

Diluted

Weighted average shares of common stock outstanding:

Basic

Diluted

2022

Fiscal Year
2021

2020

$4,645,714 $4,015,307 $3,239,141

2,359,546

2,131,741

1,917,378

2,286,168

1,883,566

1,321,763

623,636

349,718

86,745

570,395

367,238

39,306

484,414

343,569

70,564

1,060,099

976,939

898,547

1,226,069

906,627

423,216

(63,326)

18,341

(75,198)

(24,049)

(60,392)

32,265

1,181,084

807,380

395,089

(147,731)

(73,769)

(60,764)

$1,033,353 $ 733,611 $ 334,325

$

$

9.38 $

6.43 $

9.26 $

6.32 $

2.86

2.80

110,196

114,034

117,007

111,546

116,016

119,293

See accompanying notes.

39

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

Net income

Other comprehensive (loss) income, net of tax:

Change in pension liability

Foreign currency translation adjustment, including intra-entity foreign
currency transactions that are of a long-term investment nature

Reclassification adjustments, net of tax:

Foreign currency (gain) loss realized upon liquidation of subsidiary

Amortization of pension actuarial loss

Other comprehensive (loss) income

Total comprehensive income

Fiscal Year

2022

2021

2020

$1,033,353 $733,611 $334,325

857

(597)

501

(25,033)

27,859

7,923

(359)

118

16

83

353

135

(24,417)

27,361

8,912

$1,008,936 $760,972 $343,237

See accompanying notes.

40

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

Common Stock

Shares

Amount

Accumulated
Other
Comprehensive
Income (Loss)

Retained
Earnings
(Accumulated
Deficit)

Total

(In thousands)

Balance, March 30, 2019

119,063 $4,687,455

$ (6,624)

$ (321,152) $ 4,359,679

Net income

Other comprehensive income

Exercise of stock options and vesting
of restricted stock units, net of
shares withheld for employee taxes

Issuance of common stock in

connection with employee stock
purchase plan

Cumulative-effect adoption of ASU

2016-02

Repurchase of common stock,
including transaction costs

Stock-based compensation

Other

—

—

—

—

—

8,912

1,551

(974)

452

28,657

—

—

(6,441)

(501,868)

—

—

77,107

—

—

—

—

—

—

—

334,325

334,325

—

—

—

69

8,912

(974)

28,657

69

(13,263)

(515,131)

—

21

77,107

21

Balance, March 28, 2020

114,625 $4,290,377

$ 2,288

$

— $ 4,292,665

—

733,611

Net income

Other comprehensive income

Exercise of stock options and vesting
of restricted stock units, net of
shares withheld for employee taxes

Issuance of common stock in

connection with employee stock
purchase plan

Cumulative-effect adoption of ASU

2016-13

Repurchase of common stock,
including transaction costs

Stock-based compensation

Other

—

—

—

—

1,157

(29,163)

417

31,366

—

—

(3,642)

(136,568)

—

—

88,728

—

27,361

—

—

—

—

—

—

733,611

27,361

(29,163)

31,366

—

—

—

(38)

(38)

(378,516)

(515,084)

—

(21)

88,728

(21)

Balance, April 3, 2021

112,557 $4,244,740

$ 29,649

$ 355,036 $ 4,629,425

Net income

Other comprehensive loss

Exercise of stock options and vesting
of restricted stock units, net of
shares withheld for employee taxes

Issuance of common stock in

connection with employee stock
purchase plan

Repurchase of common stock,
including transaction costs

Stock-based compensation

—

—

—

—

779

(49,798)

273

33,288

(7,306)

(276,035)

—

83,654

—

1,033,353

1,033,353

(24,417)

—

—

—

—

—

—

—

(24,417)

(49,798)

33,288

(876,252)

(1,152,287)

—

83,654

Balance, April 2, 2022

106,303 $4,035,849

$ 5,232

$ 512,137 $ 4,553,218

See accompanying notes.

41

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

Cash flows from operating activities:
Net income
Adjustments to reconcile net income to net cash provided by

operating activities:
Depreciation
Intangible assets amortization
Loss on debt extinguishment
Deferred income taxes
Gain on Cavendish investment
Impairment of equity investment
Goodwill impairment
Stock-based compensation expense
Other, net
Changes in operating assets and liabilities:

Accounts receivable, net
Inventories
Prepaid expenses and other assets
Accounts payable
Accrued liabilities
Income taxes payable and receivable
Other liabilities

Net cash provided by operating activities

Cash flows from investing activities:

Purchases of property and equipment
Purchases of businesses, net of cash acquired
Other investing activities

Net cash used in investing activities

Cash flows from financing activities:
Repurchase and payment of debt
Proceeds from borrowings and debt issuances
Repurchase of common stock, including transaction costs
Proceeds from the issuance of common stock
Tax withholding paid on behalf of employees for restricted stock

units

Other financing activities

Net cash (used in) provided by financing activities
Effect of exchange rate changes on cash, cash equivalents and

restricted cash

Net (decrease) increase in cash, cash equivalents and restricted

cash

Cash, cash equivalents and restricted cash at the beginning of the

period

Cash, cash equivalents and restricted cash at the end of the period

Reconciliation of cash, cash equivalents and restricted cash:

Cash and cash equivalents
Restricted cash included in “Other current assets” and “Other

non-current assets”

Total cash, cash equivalents and restricted cash

Supplemental disclosure of cash flow information:

Cash paid during the year for interest, net of amounts capitalized
Cash paid during the year for income taxes, net of refunds
Capital expenditures included in liabilities

$

$

$

$
$
$

See accompanying notes.

42

Fiscal Year

2022

2021

2020

$ 1,033,353 $

733,611 $

334,325

210,949
150,466
744
31,875
—
—
48,000
83,507
14,150

203,206
252,898
61,991
(18,136)
—
2,775
—
89,322
(2,151)

(107,896)
(236,196)
(176,742)
33,950
(11,815)
(3,139)
(21,963)
1,049,243

(91,275)
9,390
(18,490)
34,201
30,671
34,618
(20,778)
1,301,853

221,632
247,299
—
(11,099)
(43,008)
18,339
—
75,978
23,531

21,029
10,252
(14,513)
15,425
48,670
12,935
(15,149)
945,646

(213,466)
(389,136)
6,646
(595,956)

(186,960)
(47,069)
15,371
(218,658)

(164,104)
(946,043)
4,405
(1,105,742)

(197,500)
499,070
(1,152,287)
38,303

(1,087,994)
1,206,750
(515,084)
42,598

—
659,000
(515,131)
50,198

(53,382)
(9,714)

(38,658)
(9,535)

(21,791)
(6,717)

(875,510)

(401,923)

165,559

(3,281)

1,425

(1,233)

(425,504)

682,697

4,230

1,398,309

715,612

711,382

972,805 $ 1,398,309 $

715,612

972,592 $ 1,397,880 $

714,939

213

429

673

972,805 $ 1,398,309 $

715,612

59,393 $
125,322 $
36,069 $

81,232 $
53,236 $
56,469 $

48,871
55,513
22,904

Qorvo, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
April 2, 2022

1.

THE COMPANY AND ITS SIGNIFICANT
ACCOUNTING POLICIES

Qorvo, Inc. was formed as the result of a business
combination (the “Business Combination”) of RF Micro
Devices, Inc. (“RFMD”) and TriQuint Semiconductor,
Inc. (“TriQuint”), which closed on January 1, 2015.

The Company is a global
leader in the development
and commercialization of technologies and products
for wireless, wired and power markets.

The Company’s design expertise and manufacturing
capabilities span multiple process technologies. The
Company’s primary wafer fabrication facilities are in
North Carolina, Oregon and Texas. The Company’s
primary assembly and test
facilities are in China,
Costa Rica, Germany and Texas. The Company also
sources products and materials through external
suppliers. The Company operates design, sales and
other manufacturing facilities throughout Asia, Europe
and North America.

Principles of Consolidation and Basis of Presentation
The consolidated financial statements include the
the Company and its wholly owned
accounts of
intercompany accounts
subsidiaries. All significant
and
in
been
consolidation. Certain items in the fiscal years 2021
and 2020 financial statements have been reclassified
to conform to the fiscal 2022 presentation.

transactions

eliminated

have

Accounting Periods
The Company uses a 52- or 53-week fiscal year ending
on the Saturday closest to March 31 of each year. The
most recent three fiscal years ended on April 2, 2022,
April 3, 2021 and March 28, 2020. Fiscal years 2022
and 2020 were 52-week years, and fiscal 2021 was a
53-week year.

of

consolidated

Use of Estimates
The
financial
the
preparation
statements in conformity with U.S. generally accepted
accounting principles requires management to make
estimates and assumptions that affect the reported
amounts of assets, liabilities, revenue and expenses,
and the disclosure of contingent
liabilities. The
Company evaluates its estimates on an ongoing basis,
including those related to revenue recognition, product
warranty obligations, valuation of
tax
related contingencies, valuation of
long-lived and
intangible assets, other contingencies and litigation,
among others. The Company generally bases its
estimates on historical experience, expected future
conditions and third-party evaluations. The inputs into
certain of these estimates and assumptions include
the
the consideration of

the economic impact of

inventories,

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

results could differ
COVID-19 pandemic. Actual
materially from these estimates, and such differences
could affect the operations reported in future periods.
As the impact of the COVID-19 pandemic continues to
develop, many of
these estimates could require
increased judgment and carry a higher degree of
variability and volatility, and may change materially in
future periods.

Cash and Cash Equivalents
Cash and cash equivalents consist of demand deposit
accounts, money market funds, and other temporary,
highly liquid investments with original maturities of
three months or less when purchased.

Investments
Marketable equity securities consist of common stock
in publicly-traded companies and are carried at fair
value with both the realized and unrealized gains and
losses reported in “Other income (expense), net.” Fair
values
are
determined using quoted prices in active markets. The
marketable equity securities are classified as short-
term based on their highly liquid nature and are
recorded in “Other current assets” in the Consolidated
Balance Sheets.

publicly-traded

securities

equity

of

The Company invests in limited partnerships which are
accounted for using the equity method. These equity
method investments are classified as “Long-term
investments” in the Consolidated Balance Sheets. The
Company records its share of the financial results of
the limited partnerships in “Other income (expense),
net” in the Company’s Consolidated Statements of
Income.

The Company also invests in privately held companies
for which the fair value of the investment is not readily
determinable. These equity investments without a
readily determinable fair value are measured at cost
less impairment, adjusted for any
changes in
observable prices, and are classified as “Long-term
investments” in the Consolidated Balance Sheets. The
Company assesses these investments for impairment
on a quarterly basis and considers both qualitative
and quantitative factors that may have a significant
impact on the investee’s fair value. Qualitative factors
considered include the investee’s financial condition
and business outlook, market for technology and other
relevant events and factors affecting the investee.
Investments are impaired when their fair value is less
than their carrying value.

Fair Value Measurement
The Company measures and reports certain financial
assets and liabilities on a recurring basis. Fair value is
the price that would be received to sell an asset or

43

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

Notes to Consolidated Financial Statements

paid to transfer a liability in an orderly transaction
between market participants at the measurement date.
The Company categorizes its financial
instruments
carried at fair value into a three-level fair value hierarchy,
based on the priority of
inputs to the respective
valuation technique. The three-level hierarchy for fair
value measurement is described as follows:
‰ Level 1—includes instruments for which inputs are
quoted prices in active markets for identical assets or
liabilities that the Company has the ability to access.
‰ Level 2—includes instruments for which the inputs are
other than quoted prices that are observable for the
asset or liability, either directly or indirectly, and fair
value can be determined through the use of models or
require
other valuation methodologies that do not
significant judgment since the inputs are corroborated
by readily observable data.

‰ Level 3—includes instruments for which the valuations
are based on inputs that are unobservable and
fair value measurement.
significant
These inputs are supported by little or no market
activity and reflect the use of significant management
judgment.

to the overall

The Company also holds assets whose fair value is
measured and recorded on a nonrecurring basis. These
assets include equity method investments, equity
investments without a readily determinable fair value
and certain non-financial assets, such as intangible
assets and property and equipment.
The carrying values of cash, cash equivalents and
restricted cash, accounts receivable, accounts payable
and other accrued liabilities approximate fair values
because of the relatively short-term maturities of these
instruments.

Inventories
Inventories are stated at
the lower of cost or net
realizable value (cost is based on standard cost, which
approximates actual average cost). Cost includes labor,
materials and manufacturing overhead related to the
purchase and production of
inventories. Abnormal
production levels are charged to “Cost of goods sold” in
the period incurred rather than as a portion of inventory
cost.
The Company’s business is subject
to the risk of
technological and design changes. The Company
evaluates inventory levels quarterly against demand
forecasts on a material or product
family basis to
evaluate its overall inventory risk. Reserves are adjusted
to reflect
inventory values in excess of demand
forecasts and management’s analysis and assessment
of overall inventory risk. In the event the Company sells
inventory that had been covered by a specific inventory
reserve, the sale is recorded at the actual selling price
and the related cost of goods sold is recorded at the full
inventory cost, net of the reserve.

44

against

defects

in materials

Product Warranty
The Company generally sells products with a limited
warranty
and
workmanship and non-conformance to applicable
specifications. The majority of the Company’s product
warranty claims are settled through the return of the
defective product and the shipment of replacement
product. Accruals are estimated based upon both our
historical experience as well as specifically identified
claims. If there is a material increase in the rate of
customer claims compared with the Company’s
historical experience or if the Company’s estimates of
probable losses relating to specifically
identified
warranty exposures require revision, the Company may
record a charge against future cost of sales. Product
warranty
expenses were
immaterial for the periods presented.

accruals

related

and

Property and Equipment
less
Property and equipment are stated at cost,
accumulated depreciation. Depreciation of property
and equipment
is computed using the straight-line
method over the estimated useful lives of the assets,
ranging from one to 39 years. The Company
capitalizes interest on borrowings related to eligible
capital expenditures. Capitalized interest is added to
the cost of qualified assets and depreciated together
with that asset cost. The Company’s assets acquired
under finance leases and leasehold improvements are
amortized over the lesser of the asset life or lease
term (which is reasonably assured) and included in
depreciation. The Company records capital-related
government grants earned as a reduction to property
and equipment and depreciates such grants over the
estimated useful lives of the associated assets.

The Company periodically evaluates the period over
which it expects to recover the economic value of the
Company’s property and equipment,
considering
factors such as changes in machinery and equipment
technology,
the ability to re-use equipment across
generations of process technology and historical
If the Company determines that the
usage trends.
lives of its assets are shorter or longer than
useful
the rate of depreciation is
originally estimated,
adjusted to reflect
the
assets.

the revised useful

lives of

The Company assesses property and equipment for
impairment when events or changes in circumstances
indicate that the carrying amount of its assets may not
be recoverable. Factors that are considered in
review
deciding when to perform an impairment
include an adverse change in the use of
the
Company’s assets or an expectation that the assets
will be sold or otherwise disposed. The Company

Notes to Consolidated Financial Statements

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

assesses the recoverability of the assets held and
used by comparing the projected undiscounted net
cash flows associated with the related asset or group
of assets over their remaining estimated useful lives
against
respective carrying amounts. Assets
identified as “held for sale” are recorded at the lesser
of their carrying value or their fair market value less
costs to sell.
is based on the
excess of the carrying amount over the fair value of
those assets.

Impairment,

if any,

their

Leases
The Company determines that a contract contains a
lease at lease inception if the contract conveys the
right to control the use of an identified asset for a
period of
In
evaluating whether the right to control an identified
asset exists, the Company assesses whether it has
the right to direct the use of the identified asset and
obtain substantially all of the economic benefit from
the use of the identified asset.

time in exchange for consideration.

Right-of-use assets and liabilities are recognized at the
lease commencement date based on the present
value of lease payments over the lease term. The
Company uses its estimated incremental borrowing
rate in determining the present value of
lease
payments considering the term of the lease, which is
the lease
derived from information available at
commencement date. The lease term includes renewal
options when it is reasonably certain that the option
will be exercised and excludes termination options. To
the Company’s agreements have
that
the extent
variable lease payments,
includes
the Company
variable lease payments that depend on an index or a
rate and excludes those that depend on facts or
circumstances occurring after
the commencement
date, other than the passage of time. The Company
elected the practical expedient not to separate lease
and non-lease components for substantially all of its
classes of leases and to account for the combined
lease and non-lease components as a single lease
the Company made an
component.
accounting policy election to exclude leases with an
initial term of 12 months or less from the balance
sheet.

In addition,

Business Acquisitions
The Company allocates the fair value of the purchase
price to the assets acquired and liabilities assumed
based on their estimated fair value. The excess of the
purchase price over the fair values of the identifiable
assets and liabilities is recorded to goodwill. Goodwill
is assigned to the Company’s reporting unit that is
expected to benefit from the synergies of the business
combination.

A number of assumptions, estimates and judgments
are used in determining the fair value of acquired
assets and liabilities, particularly with respect to the
intangible assets acquired. The valuation of intangible
assets requires the Company
to use valuation
techniques such as the income approach. The income
approach includes management’s estimation of future
cash flows (including expected revenue growth rates
and profitability), the underlying product or technology
life cycles and the discount rates applied to future
cash flows.

Judgment is also required in estimating the fair values
of deferred tax assets and liabilities, uncertain tax
positions and tax-related valuation allowances, which
are initially estimated as of the acquisition date, as
well as inventory, property and equipment, pre-existing
liabilities or
legal claims, deferred revenue and
contingent consideration, each as may be applicable.

applicable,

consideration, where

While the Company uses its best estimates and
assumptions to accurately value assets acquired and
liabilities assumed at the acquisition date as well as
contingent
the
Company’s estimates are inherently uncertain and
subject
to refinement. As a result, during the
measurement period, which may be up to one year
from the acquisition date, the Company may record
adjustments to the assets acquired and liabilities
assumed with the corresponding offset to goodwill.
After
the measurement period, any purchase price
adjustments are recognized in the Consolidated
Statements of Income.

Goodwill Impairment Testing
In accordance with Accounting Standards Codification
(“ASC”) 350, “Intangibles—Goodwill and Other” (“ASC
350”), goodwill
is
reviewed for impairment at the reporting unit level on
the first day of the Company’s fourth quarter of each
fiscal year, or when there is evidence that events or
changes in circumstances indicate that the carrying
amount of the goodwill may not be recovered.

is not amortized, but

rather

Under ASC 350, the Company has the option to first
assess qualitatively whether it is more likely than not
that the fair value of a reporting unit is less than its
carrying amount, including goodwill.

and

characteristics

The Company establishes its reporting units based on
its current organizational structure, product and
technology
segment
management’s view of the business. As of January 2,
2022, the Company identified three reporting units
within the Mobile Products (“MP”) operating segment
and two reporting units within the Infrastructure and
Defense Products (“IDP”) operating segment, and the
optional qualitative assessment under ASC 350 was

the

45

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

Notes to Consolidated Financial Statements

the existence of
performed to determine whether
events or circumstances indicated that it was more
likely than not that the fair value of each reporting unit
was less than its respective carrying value.

In performing qualitative assessments, the Company
considers (i) its overall historical and projected future
operating results, (ii) if there was a significant decline
in its stock price for a sustained period, (iii) if there
was a significant change in its market capitalization
relative to its net book value, and (iv) if there was a
prolonged or more significant slowdown in the
worldwide economy of the semiconductor industry, as
well as other relevant events and factors affecting the
reporting unit.

their

related

carrying

exceeded

In fiscal 2022, the Company completed its annual
qualitative assessments and concluded that based on
the relevant events and circumstances, it was more
likely than not that four of its five reporting units’ fair
values.
values
However, for one of the Company’s MP reporting units
(the acquired NextInput, Inc. (“NextInput”) business),
it was determined that the market adoption of the
acquired technology into mobile handsets is expected
to be delayed compared to the previous assumptions.
Therefore, it was determined that it was more likely
than not that the fair value of the reporting unit was
less than its carrying amount, and a quantitative
assessment was performed to calculate the fair value
of the reporting unit.

The quantitative assessment considered both the
income and market approaches to estimate the fair
value of the reporting unit. The income approach is
based on the discounted cash flow method that uses
estimates of
the reporting unit’s forecasted future
financial performance including revenues, operating
taxes and capital expenditures. These
expenses,
estimates are developed as part of the Company’s
long-term planning process based on assumed market
segment growth rates and its assumed market
segment share, estimated costs based on historical
data and various internal estimates. Projected cash
flows are then discounted to a present
value
employing a discount rate that properly accounts for
the estimated market weighted-average cost of
capital, as well as any risk unique to the cash flows.
The market approach is based on financial multiples
(i.e., multiples of revenue or earnings before income
taxes, depreciation and amortization) of comparable
companies.

Based on the quantitative assessment performed, it
was determined that
the
reporting unit exceeded its fair value, which resulted in
impairment charge of $48.0 million. The
a goodwill
impairment charge is recorded in “Other
goodwill

the carrying amount of

46

operating expense” in the Statement of Income for the
fiscal year ended April 2, 2022.

in such fair value determinations of

Inherent
the
Company’s reporting units are significant judgments
including assumptions about future
and estimates,
revenue, profitability and cash flows, operational plans
and the Company’s interpretation of current economic
indicators and market valuations. To the extent these
assumptions are incorrect or there are further declines
in the Company’s business outlook, additional
goodwill impairment charges may be recorded in future
periods.

In fiscal 2021, the Company completed qualitative
assessments and concluded that based on the
relevant events and circumstances, it was more likely
than not that each of the reporting unit’s fair value
exceeded its related carrying value, and no further
impairment testing was required.

definite-lived

Identified Intangible Assets
The Company
intangible
amortizes
assets (including developed technology, customer
relationships, technology licenses, backlog and trade
names) over their estimated useful
lives. In-process
research and development (“IPRD”) assets represent
the fair value of incomplete research and development
(“R&D”) projects that had not reached technological
feasibility as of the date of the acquisition and are
initially not subject to amortization. Upon completion
of development,
IPRD assets are transferred to
developed technology and are amortized over their
useful lives. The asset balances relating to abandoned
projects are impaired and expensed to R&D.

The Company evaluates definite-lived intangible assets
for impairment in accordance with ASC 360-10-35,
“Impairment or Disposal of Long-Lived Assets” to
determine whether facts and circumstances (including
external factors such as industry and economic trends
and internal
factors such as changes in the
Company’s business strategy and forecasts) indicate
that the carrying amount of the assets may not be
recoverable. If such facts and circumstances exist, the
identified
Company assesses the recoverability of
intangible
projected
the
by
undiscounted net cash flows associated with the
related asset or group of assets over their remaining
lives against
respective carrying amounts.
Impairments, if any, are based on the excess of the
carrying amounts over the fair value of those assets
in the period in which the impairment
and occur
determination was made.

comparing

assets

their

In connection with completing the Company’s fiscal
2022 annual goodwill
impairment assessment, the
Company also evaluated its long-lived intangible

Notes to Consolidated Financial Statements

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

and

that

determined

forecasted
assets
undiscounted net cash flows related to these assets
were in excess of their carrying values. No definite-
lived intangible asset
charges were
recorded for fiscal years 2022 or 2021.

impairment

the

Accrued Liabilities
The “Accrued liabilities” balance as of April 2, 2022
and April 3, 2021,
includes accrued compensation
and benefits of $113.6 million and $135.4 million,
respectively, and interest payable of $19.8 million and
$17.5 million, respectively.

Other Current Liabilities
The “Other current liabilities” balance as of April 2,
includes income taxes
2022 and April 3, 2021,
payable
and $86.7 million,
respectively.

of $87.8 million

Revenue Recognition
The Company generates revenue primarily from the
sale of semiconductor products, either directly to a
customer or to a distributor, or at completion of a
consignment process. Revenue is recognized when
the promised goods or services is
control of
transferred to the Company’s customers,
in an
amount that reflects the consideration to which the
Company expects to be entitled in exchange for those
goods or services. A majority of
the Company’s
revenue is recognized at a point in time, either on
shipment or delivery of the product, depending on
individual customer terms and conditions. Revenue
from sales to the Company’s distributors is recognized
upon shipment of
to the distributors
the product
(sell-in). Revenue is recognized from the Company’s
consignment programs at a point in time when the
products are pulled from consignment inventory by the
customer. Revenue recognized for products and
services over time is immaterial
(less than 3% of
overall
revenue). The Company applies a five-step
approach as defined in ASC 606, “Revenue from
Contracts with Customers,” in determining the amount
and timing of revenue to be recognized: (1) identifying
identifying the
the contract with a customer;
performance
contract;
in
(3) determining the transaction price; (4) allocating the
transaction price to the performance obligations in the
contract; and (5)
recognizing revenue when the
corresponding performance obligation is satisfied.

obligations

the

(2)

Sales agreements are in place with certain customers
and contain terms and conditions with respect
to
payment, delivery, warranty and supply, but typically do
not require minimum purchase commitments. In the
absence of a sales agreement,
the Company’s
standard terms and conditions apply. The Company

considers a customer’s purchase order, which is
governed by a sales agreement or the Company’s
standard terms and conditions, to be the contract with
the customer.

are

terms

pricing

to refund or adjustment

negotiated
The Company’s
independently, on a stand-alone basis. In determining
the transaction price, the Company evaluates whether
the price is subject
to
determine the net consideration to which the Company
expects to be entitled. Variable consideration in the
form of
rebate programs is offered to certain
customers, including distributors, and represents less
than 7% of net revenue. The Company determines
variable consideration by estimating the most likely
amount of consideration it expects to receive from the
customer. The Company’s terms and conditions do
not give its customers a right of return associated with
the original sale of
the
Company may authorize sales returns under certain
circumstances, which include courtesy returns and
like-kind exchanges. The Company reduces revenue
and records reserves
returns and
for product
rebate programs and scrap allowance
allowances,
specific
experience
on
based
identification depending on the contractual terms of
the arrangement.

its products. However,

historical

or

of

the

due

and

customers

represents

are
obligation

customers. Payments
performance

The Company’s accounts receivable balance is from
the
contracts with
Company’s unconditional right to receive consideration
upon
from its
completion
and
subsequent invoicing. Substantially all payments are
collected within the Company’s standard terms, which
do not include any financing components. To date,
there have been no material
impairment losses on
accounts receivable. Contract assets and contract
liabilities recorded on the Consolidated Balance
Sheets were immaterial as of April 2, 2022 and
April 3, 2021.

The Company invoices customers upon shipment and
recognizes revenue in accordance with delivery terms.
As of April 2, 2022, the Company had $424.7 million
in remaining unsatisfied performance obligations with
an original duration greater than one year, of which the
majority is expected to be recognized as income over
the next 12 months.

The Company includes shipping charges billed to
customers in “Revenue” and includes the related
shipping costs in “Cost of goods sold” in the
Consolidated Statements of Income. Taxes assessed
by
government authorities on revenue-producing
transactions, including tariffs, value-added and excise
taxes, are excluded from revenue in the Consolidated
Statements of Income.

47

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

Notes to Consolidated Financial Statements

is
The Company incurs commission expense that
incremental
to obtaining contracts with customers.
Sales commissions (which are recorded in the
“Selling, general and administrative” expense line
item in the Consolidated Statements of Income) are
expensed when incurred because such commissions
are not owed until
the performance obligation is
satisfied, which coincides with the end of the contract
term, and therefore, no remaining period exists over
which to amortize the commissions.

Research and Development
The Company charges all R&D costs to expense as
incurred.

Income Taxes
The Company accounts for income taxes under the
liability method, which requires recognition of deferred
tax assets and liabilities for the temporary differences
reporting and tax basis of
between the financial
assets and liabilities and for
tax carryforwards.
Deferred tax assets and liabilities for each tax
jurisdiction are measured using the enacted statutory
the years in which the
tax rates in effect
differences are expected to reverse. A valuation
allowance is provided against deferred tax assets to
the extent the Company determines it is more likely
than not that some portion or all of its deferred tax
assets will not be realized.

for

A more likely than not recognition threshold is required
to be met before the Company recognizes the benefit
of an income tax position in its financial statements.
The Company’s policy is to recognize accrued interest
and penalties, if incurred, on any unrecognized tax
benefits as a component of income tax expense.

is the Company’s current

It
intent and policy to
repatriate certain previously taxed earnings of foreign
subsidiaries from outside the U.S. Accordingly, the
Company recognizes a deferred tax liability for income
taxes on certain unremitted foreign earnings of foreign
subsidiaries. For earnings which remain permanently
to estimate the
reinvested,
additional tax that would be incurred, if any, if the
permanently reinvested earnings were repatriated.

is not practical

it

ASC

718,

“Compensation

Stock-Based Compensation
Stock
Under
Compensation,” stock-based compensation cost
is
measured at the grant date, based on the estimated
fair value of the award using an option pricing model
for stock options (Black-Scholes) and market price for
restricted stock units, and is recognized as expense
over the employee’s requisite service period.

–

As of April 2, 2022,
compensation cost

remaining unearned
related to unvested restricted

total

48

stock units was $121.0 million, which will be
amortized over the weighted-average remaining service
period of approximately 1.2 years.

of

the

remainder

the Company’s

Foreign Currency Translation
The financial statements of foreign subsidiaries have
been translated into U.S. dollars in accordance with
ASC 830, “Foreign Currency Matters.” The functional
currency for most of
the Company’s international
operations is the U.S. dollar. The functional currency
foreign
for
subsidiaries is the local
currency. Assets and
liabilities denominated in foreign currencies are
translated using the exchange rates on the balance
sheet dates. Revenues and expenses are translated
using the weighted average exchange rates throughout
the
shown
separately as a component of “Accumulated other
comprehensive income” within “Stockholders’ equity”
in the Consolidated Balance Sheets. Foreign currency
transaction gains or losses (transactions denominated
in a currency other than the functional currency) are
reported in “Other
income (expense), net” in the
Consolidated Statements of Income.

adjustments

Translation

year.

are

2019,

Financial

Accounting Pronouncements Recently Adopted
In December
Accounting
the
Standards Board issued Accounting Standards Update
Income
2019-12, “Simplifying the Accounting for
Taxes,” which eliminated certain exceptions within
ASC 740, “Income Taxes” and clarified and simplified
other aspects of the current accounting guidance. The
Company adopted this standard in the first quarter of
fiscal 2022, and it did not have a material impact on
the Company’s consolidated financial statements.

2. CONCENTRATIONS OF CREDIT RISK

The Company’s principal financial instrument subject
to potential concentration of credit risk is accounts
receivable, which is unsecured. The Company provides
an allowance for doubtful accounts equal to estimated
losses expected to be incurred in the collection of
accounts receivable. The Company’s trade receivables
are evaluated on a collective (pool) basis and
aggregated on the basis of similar risk characteristics,
adjusting for broad-based economic indicators as well
as customer specific factors. The Company has
adopted credit policies and standards intended to
accommodate industry growth and inherent risk and it
believes that credit
risks are moderated by the
financial stability of its major customers, conservative
payment
terms and the Company’s strict credit
policies.

The Company provides products to its largest end
through sales to multiple
customer, Apple Inc.,

Notes to Consolidated Financial Statements

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

Samsung

contract manufacturers, which in the aggregate
accounted for approximately 33%, 30% and 33% of
total revenue in fiscal years 2022, 2021 and 2020,
respectively.
Ltd.,
accounted for approximately 11%, 7% and 8% of total
revenue in fiscal years 2022, 2021 and 2020,
respectively. These customers primarily purchase
radio frequency (“RF”) solutions for a variety of mobile
devices.

Electronics

Co.,

The Company’s three largest accounts receivable
balances comprised approximately 57% and 58% of
aggregate gross accounts receivable as of April 2,
2022 and April 3, 2021, respectively.

3.

INVENTORIES

The components of inventories, net of reserves, are
as follows (in thousands):

Raw materials
Work in process
Finished goods

Total inventories

April 2, 2022 April 3, 2021
$134,959
$236,095
283,067
357,332
162,321
89,761
$507,787
$755,748

4. PROPERTY AND EQUIPMENT

The components of property and equipment are as
follows (in thousands):

Land
Building and leasehold

improvements

Machinery and
equipment

Construction in progress
Total property and

April 2, 2022 April 3, 2021
25,842
$

25,842 $

432,305

411,180

2,401,735
128,317

2,282,059
108,563

equipment, gross

2,988,199

2,827,644

Less accumulated
depreciation
Total property and
equipment, net

(1,734,608) (1,561,613)

$ 1,253,591 $ 1,266,031

5. BUSINESS ACQUISITIONS

During fiscal 2022,
the Company completed the
acquisitions of United Silicon Carbide, Inc. (“United
SiC”) and NextInput. During fiscal 2021, the Company
completed the acquisition of 7Hugs Labs S.A.S.
(“7Hugs”). During
the Company
completed the acquisitions of Decawave Limited
Inc.
(“Decawave”), Custom MMIC Design Services,
Limited
(“Custom MMIC”),
Cavendish
Inc.
(“Cavendish”) and Active-Semi

Kinetics
International,

2020,

fiscal

resulting from these
(“Active-Semi”). The goodwill
acquisitions is attributed to synergies and other
benefits that are expected to be generated from these
transactions.

The operating results of these companies, which were
not material either individually or in the aggregate,
have been included in the Company’s consolidated
financial statements as of the acquisition dates. As a
result, pro forma results of operations for
these
acquisitions have not been presented.

of

silicon

United Silicon Carbide, Inc.
On October 19, 2021, the Company acquired all the
outstanding equity interests of United SiC, a leading
manufacturer
power
for a total purchase price of
semiconductors,
$236.6 million.
the
Company’s offerings to include SiC power products for
a range of applications such as electric vehicles,
battery charging,
renewables and
IT infrastructure,
circuit protection.

acquisition

expands

carbide

(“SiC”)

The

of

purchase

comprised

price was

The
cash
consideration of $227.1 million and contingent
consideration of up to $31.3 million which is expected
to be paid to the sellers (in the first quarter of fiscal
2024) if certain revenue and gross margin targets are
achieved over the period beginning on the acquisition
date through December 31, 2022. The estimated fair
value of the contingent consideration was $9.5 million
as of
the
contingent consideration liability was remeasured to a
fair value of $17.6 million and is included in “Other
long-term liabilities” in the Consolidated Balance
Sheet. The increase in the fair value was recognized in
in the Consolidated
“Other operating expense”
further
Statement of
information related to the fair value measurement.

the acquisition date. At April 2, 2022,

Income. See Note 7 for

The purchase price was preliminarily allocated based
on the estimated fair values of the assets acquired
and liabilities assumed as follows (in thousands):

Intangible assets
Goodwill
Net tangible assets (1)
Deferred tax liability, net

Total purchase price

$145,780
96,755
18,127
(24,036)

$236,626

(1) Includes cash acquired of $5.5 million.

intangible assets acquired
The more significant
included developed technology of $126.1 million and
customer relationships of $19.2 million.

The fair value of the developed technology acquired
was determined based on an income approach using

49

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

Notes to Consolidated Financial Statements

the “excess earnings method” which estimated the
value of the intangible asset by discounting the future
projected earnings of the asset to present value as of
the valuation date. The acquired developed technology
asset is being amortized on a straight-line basis over
its estimated useful life of eleven years.

The fair value of the customer relationships acquired
was determined based on an income approach using
the “with and without method” in which the value of
the intangible asset is determined by the difference in
discounted cash flows of
the
Company “with” the asset and the profitability of the
Company
These customer
relationships are being amortized on a straight-line
basis over their estimated useful life of three years.

the profitability of

the asset.

“without”

The Company will continue to evaluate certain assets,
liabilities and tax estimates over the measurement
period (up to one year from the acquisition date).
Goodwill recognized from the acquisition of United SiC
has been assigned to the IDP segment and is not
deductible for income tax purposes.

During fiscal 2022, the Company recorded acquisition
and integration related costs associated with the
acquisition of United SiC totaling $12.2 million in
in the Consolidated
“Other operating expense”
Statement of
the
Company also recorded $3.6 million of acquisition and
integration related costs in “Cost of goods sold” in the
Consolidated Statement of Income.

Income. During fiscal 2022,

the Company acquired all

NextInput, Inc.
On April 5, 2021,
the
outstanding equity interests of NextInput, a leader in
microelectromechanical
(“MEMS”)-based
sensing solutions, for a total cash purchase price of
the
$173.3 million.
Company’s offerings of MEMS-based products for
mobile applications and provides sensing solutions for
a broad range of applications in other markets.

acquisition

expands

system

The

The fair value of the developed technology acquired
was determined based on an income approach using
the “excess earnings method” described above. The
acquired
being
amortized on a straight-line basis over its estimated
useful life of seven years.

technology

developed

asset

is

The fair value of the customer relationships acquired
was determined based on an income approach using
the “with and without method” described above.
These customer relationships are being amortized on
a straight-line basis over their estimated useful life of
one year.

Goodwill recognized from the acquisition of NextInput
has been assigned to the MP segment and is not
deductible for income tax purposes.

During fiscal years 2022 and 2021, the Company
recorded acquisition and integration related costs
associated with the acquisition of NextInput totaling
$2.7 million and $1.8 million, respectively, in “Other
operating expense” in the Consolidated Statements of
Income.

In connection with the Company’s annual qualitative
goodwill
impairment assessment, it was determined
that the market adoption of the acquired NextInput
technology into mobile handsets is expected to be
delayed compared to the previous assumptions. As a
quantitative
result,
assessment of its reporting unit, which resulted in a
goodwill impairment charge of $48.0 million. See Note
6 for further information on this goodwill impairment
charge.

the Company

completed

a

the Company acquired all

7Hugs Labs S.A.S.
In fiscal 2021,
the
outstanding equity interests of 7Hugs, a private
developer of ultra-wideband (“UWB”) software and
solutions,
cash purchase price of
$48.7 million.

for a total

The purchase price was preliminarily allocated based
on the estimated fair values of the assets acquired
and liabilities assumed as follows (in thousands):

Intangible assets
Goodwill
Net tangible assets (1)
Deferred tax liability, net

Total purchase price

$ 81,000
95,211
7,261
(10,158)

$173,314

(1) Includes cash acquired of $5.8 million.

The more significant
intangible assets acquired
included developed technology of $73.0 million and
customer relationships of $7.5 million.

50

During fiscal years 2022 and 2021, the Company
recorded acquisition and integration related costs
associated with the acquisition of 7Hugs totaling
$0.2 million and $2.4 million, respectively, in “Other
operating expense” in the Consolidated Statements of
Income.

the Company acquired all

Decawave Limited
In fiscal 2020,
the
outstanding equity interests of Decawave, a pioneer in
UWB technology and provider of UWB solutions for
mobile, automotive and Internet of Things (“IoT”)
applications,
for a total cash purchase price of
$372.2 million.

Notes to Consolidated Financial Statements

the
During fiscal years 2022, 2021 and 2020,
Company recorded acquisition and integration related
costs associated with the acquisition of Decawave
totaling $6.7 million, $11.3 million and $12.4 million,
respectively,
in “Other operating expense” in the
Consolidated Statements of Income.

the Company acquired all

Custom MMIC Design Services, Inc.
In fiscal 2020,
the
outstanding equity interests of Custom MMIC, a
supplier of high-performance gallium arsenide and
gallium nitride monolithic microwave integrated circuits
for defense, aerospace and commercial applications,
for a total purchase price of $91.7 million.

During fiscal years 2021 and 2020, the Company
recorded acquisition and integration related costs
associated with the acquisition of Custom MMIC
totaling $10.3 million and $9.4 million, respectively, in
in the Consolidated
“Other operating expense”
Statements of Income.

fiscal 2020,

Cavendish Kinetics Limited
the
the Company
In
acquisition of the remaining issued and outstanding
capital of Cavendish for
cash consideration of
$198.4 million. The purchase of the remaining equity
interest
in Cavendish was considered to be an
acquisition achieved in stages, whereby the previously

completed

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

held equity interest was remeasured at its acquisition-
date fair value. This resulted in recognition of a gain of
$43.0 million in fiscal 2020, which is recorded in
“Other income (expense), net” in the Consolidated
Statement of Income.

During fiscal years 2022, 2021 and 2020,
the
Company recorded acquisition and integration related
costs associated with the acquisition of Cavendish
totaling less than $0.1 million, $0.7 million and
operating
$3.8 million,
expense” in the Consolidated Statements of Income.

respectively,

“Other

in

the Company acquired all

Active-Semi International, Inc.
the
In fiscal 2020,
outstanding equity interests of Active-Semi, a private
fabless supplier of programmable analog power
management solutions, for a total cash purchase price
of $307.9 million.

During fiscal years 2022, 2021 and 2020,
the
Company recorded acquisition and integration related
costs associated with the acquisition of Active-Semi of
$0.2 million, $0.8 million and $25.3 million,
in “Other operating expense” in the
respectively,
Consolidated Statements of
Income. During fiscal
2020, the Company also recorded $4.2 million of
acquisition and integration related costs in “Cost of
goods sold” in the Consolidated Statement of Income.

6. GOODWILL AND INTANGIBLE ASSETS

The changes in the carrying amount of goodwill for fiscal 2022 are as follows (in thousands):

Balance as of April 3, 2021 (1)
Goodwill resulting from NextInput acquisition (Note 5)
Goodwill impairment
Goodwill resulting from United SiC acquisition (Note 5)
7Hugs measurement period adjustments
Effect of changes in foreign currency exchange rates
Balance as of April 2, 2022 (1)

Mobile
Products
$2,034,383
95,211
(48,000)
—
(97)
(10,943)
$2,070,554

Infrastructure
and Defense
Products
$608,325
—
—
96,755
—
—
$705,080

Total
$2,642,708
95,211
(48,000)
96,755
(97)
(10,943)
$2,775,634

(1) The Company’s goodwill balance is presented net of accumulated impairment losses and write-offs totaling $669.6 million and
$621.6 million as of April 2, 2022 and April 3, 2021, respectively, which were recognized in fiscal years 2009, 2013, 2014 and
2022.

In accordance with ASC 350, the Company reviewed its goodwill for impairment at the reporting unit level on the first
day of its fourth quarter of fiscal 2022. The Company first performed the optional qualitative impairment assessments
and concluded that based on the relevant events and circumstances it was more likely than not that four of its five
reporting units’ fair values exceeded their related carrying values. However, for one of its reporting units within the MP

51

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

Notes to Consolidated Financial Statements

segment (the NextInput business), it was determined that the adoption of the acquired NextInput technology into mobile
handsets is expected to be delayed compared to the previous assumptions. As a result, the Company determined that
it was more likely than not that the fair value of the reporting unit was less than its carrying amount. Therefore, the
Company performed a quantitative assessment to calculate the fair value of the reporting unit.

The quantitative assessment considered both the income and market approaches to estimate the fair value of the
reporting unit. The income approach is based on the discounted cash flow method that uses estimates of the reporting
unit’s forecasted future financial performance including revenues, operating expenses, taxes and capital expenditures.
These estimates are developed as part of the Company’s long-term planning process based on assumed market
segment growth rates and its assumed market segment share, estimated costs based on historical data and various
internal estimates. Projected cash flows are then discounted to a present value employing a discount rate that properly
accounts for the estimated market weighted-average cost of capital, as well as any risk unique to the cash flows. The
market approach is based on financial multiples (i.e., multiples of revenue or earnings before income taxes,
depreciation and amortization) of comparable companies.

Based on the quantitative assessment performed, the carrying amount of the reporting unit exceeded its fair value,
which resulted in a goodwill impairment charge of $48.0 million. The goodwill impairment charge is recorded in “Other
operating expense” in the fiscal 2022 Statement of Income.

The following summarizes information regarding the gross carrying amounts and accumulated amortization of
intangible assets (in thousands):

Developed technology
Customer relationships
Technology licenses
Backlog
Trade names
IPRD

Total (1)

April 2, 2022

April 3, 2021

Gross
Carrying Amount
$1,026,690
104,778
2,641
—
1,933
9,734
$1,145,776

Accumulated
Amortization
$420,255
47,208
2,169
—
1,358
N/A
$470,990

Gross
Carrying Amount
$1,295,113
459,052
2,368
1,600
1,090
9,695
$1,768,918

Accumulated
Amortization
$ 750,044
403,407
2,076
1,600
636
N/A
$1,157,763

(1) Amounts include the impact of foreign currency translation.

At the beginning of each fiscal year, the Company removes the gross asset and accumulated amortization amounts
of intangible assets that have reached the end of their useful lives and have been fully amortized. Useful lives are
estimated based on the expected economic benefit to be derived from the intangible assets.

Total intangible assets amortization expense was $150.5 million, $252.9 million and $247.3 million in fiscal years
2022, 2021 and 2020, respectively.

The following table provides the Company’s estimated amortization expense for intangible assets based on current
amortization periods for the periods indicated (in thousands):

Fiscal Year
2023
2024
2025
2026
2027

Estimated
Amortization
Expense
$134,000
122,000
105,000
94,000
82,000

7.

INVESTMENTS AND FAIR VALUE OF FINANCIAL INSTRUMENTS

Equity Method Investments
The Company invests in limited partnerships and accounts for these investments using the equity method. The
carrying amounts of these investments as of April 2, 2022 and April 3, 2021 were $27.1 million and $29.8 million,
respectively, and are classified as “Long-term investments” in the Consolidated Balance Sheets. During fiscal

52

Notes to Consolidated Financial Statements

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

years 2022 and 2021, the Company recorded income of $12.0 million and $21.5 million, respectively, based on
its share of the limited partnerships’ earnings in “Other income (expense), net” in the Consolidated Statements of
Income. The Company received cash distributions totaling $14.8 million and $5.9 million during fiscal years 2022
and 2021, respectively. The cash distributions were recognized as reductions to the carrying value of the
investments and included in the cash flows from investing activities in the Consolidated Statements of Cash Flows.

Fair Value of Financial Instruments
The fair value of the financial assets and liabilities measured on a recurring basis as determined using the
following levels of inputs (in thousands):

April 2, 2022

Marketable equity securities
Invested funds in deferred compensation plan (1)
Contingent earn-out liability (2)

April 3, 2021

Marketable equity securities
Invested funds in deferred compensation plan (1)
Contingent earn-out liability (3)

Quoted Prices In
Active Markets For
Identical Assets
(Level 1)

Significant
Other Observable
Inputs
(Level 2)

Significant
Unobservable
Inputs
(Level 3)

$ 2,906
39,356
—

$ 3,802
32,824
—

$

$

—
—
—

—
—
—

$

—
—
(17,600)

$

—
—
(10,000)

Total

$ 2,906
39,356
(17,600)

$ 3,802
32,824
(10,000)

(1) Invested funds under the Company’s non-qualified deferred compensation plan are held in a rabbi trust and consist of mutual funds. The fair
value of the mutual funds is calculated using the net asset value per share as determined by quoted active market prices of the underlying
investments. See Note 10 for further information on the Company’s non-qualified deferred compensation plan.

(2) The Company recorded a contingent earn-out liability in conjunction with the acquisition of United SiC (see Note 5). The fair value of this

liability is estimated using an option pricing model.

(3) The Company recorded a contingent earn-out liability in conjunction with the acquisition of Custom MMIC. As of April 3, 2021, the fair value of

the contingent consideration liability was equal to the maximum amount payable which was paid during fiscal 2022.

8.

LEASES

The Company leases certain of its corporate, manufacturing and other facilities from multiple third-party real estate
developers. The Company also leases various machinery and office equipment. These operating leases expire at
various dates through 2036, and some of these leases have renewal options, with the longest ranging up to two,
ten-year periods.

Operating leases are classified as follows (in thousands):

Other non-current assets
Other current liabilities
Other long-term liabilities

April 2, 2022 April 3, 2021

$73,683
$17,393
$61,511

$62,925
$15,068
$53,172

Details of operating leases are as follows (in thousands):

Fiscal Year

Operating lease expense
Short-term lease expense
Variable lease expense

2022

2021

2020

$19,178 $17,382 $15,184
$ 7,726 $ 7,062 $ 6,878
$ 4,886 $ 3,972 $ 3,098

Cash paid for amounts included in the measurement of operating lease liabilities

$20,536 $18,697 $16,504

Right-of-use assets obtained in exchange for new operating lease liabilities

$29,210 $12,899 $13,201

53

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

Notes to Consolidated Financial Statements

The weighted-average remaining lease term and
weighted-average discount rates for operating leases
are as follows:

April 2, 2022 April 3, 2021

Weighted-average

remaining lease term
(years)

Weighted-average
discount rate

6.9

7.9

2.99%

3.82%

The aggregate future lease payments for operating
leases as of April 2, 2022 are as follows (in
thousands):

Fiscal Year
2023
2024
2025
2026
2027
Thereafter

Total future lease payments

Less imputed interest

Present value of lease liabilities

Lease
Payments
$19,449
16,305
11,555
10,430
9,055
21,522
88,316
(9,412)
$78,904

In fiscal 2018, the Company entered into a lease for a
facility in Beijing, China that will allow the Company to
consolidate several leased facilities as well as provide
additional manufacturing space. The lease term is
expected to commence in fiscal 2023 and therefore,
is not recorded on the Consolidated Balance Sheets
as of April 2, 2022 and April 3, 2021. The lease has
an initial
five years and includes multiple
renewal options, with the maximum lease term not to
exceed 30 years. Upon lease commencement,
right-of-use assets and lease
$10.0 million of
liabilities is expected to be recognized by
the
Company.

term of

9. LONG-TERM DEBT

Long-term debt is as follows (in thousands):

Term loan

1.750% senior notes due 2024

4.375% senior notes due 2029

3.375% senior notes due 2031

Finance leases and other

Unamortized premium, discount

April 2, 2022

April 3, 2021

$

— $ 197,500

500,000

850,000

700,000

2,581

—

850,000

700,000

1,617

and issuance costs, net

(4,692)

(1,475)

Less current portion of

long-term debt

Total long-term debt

(791)

(5,092)

$2,047,098

$1,742,550

54

Credit Agreement
On September 29, 2020, the Company and certain of
its U.S. subsidiaries (the “Guarantors”) entered into a
five-year unsecured senior credit facility pursuant to a
credit agreement (as amended, restated, modified or
otherwise supplemented from time to time, the “2020
Credit Agreement”) with Bank of America, N.A., acting
as administrative agent (the “Administrative Agent”),
and a syndicate of
lenders. The 2020 Credit
Agreement amended and restated the previous credit
agreement dated as of December 5, 2017 (the “2017
Credit Agreement”). The 2020 Credit Agreement
included a senior term loan (the “2020 Term Loan”) of
$200.0 million and a senior revolving line of credit
(the “Revolving Facility”) of up to $300.0 million
(collectively the “Credit Facility”). The Revolving Facility
includes a $25.0 million sublimit for the issuance of
standby letters of credit and a $10.0 million sublimit
for swing line loans. The Credit Facility is available to
finance working capital, capital expenditures and other
general corporate purposes.

Pursuant to the 2020 Credit Agreement, the Company
may request one or more additional tranches of term
loans or increases to the Revolving Facility, up to an
aggregate of $500.0 million and subject to, among
other things, securing additional funding commitments
from the existing or new lenders.

(ii)

(the “LIBOR Transition Amendment”)

On April 6, 2022, the Company and the Administrative
Agent entered into an amendment to the 2020 Credit
Agreement
to
replace the London Interbank Offered Rate as a
reference rate available for use in the computation of
interest under the 2020 Credit Agreement. As a result
of the LIBOR Transition Amendment, at the Company’s
option, loans under the 2020 Credit Agreement will
bear interest at (i) the Applicable Rate (as defined in
the 2020 Credit Agreement) plus the Term SOFR (as
defined in the 2020 Credit Agreement) or
the
Applicable Rate plus a rate equal to the highest of
(a) the federal funds rate plus 0.50%, (b) the prime
rate as set by the Administrative Agent, and (c) the
Term SOFR plus 1.0% (the “Base Rate”). All swing line
loans will bear
to the
Applicable Rate plus the Base Rate. The Term SOFR is
the rate per annum equal
to the forward-looking
Secured Overnight Financing Rate term rate for
interest periods of one,
three or six months (as
selected by the Company) plus an adjustment (as
defined in the 2020 Credit Agreement). The Applicable
Rate for Term SOFR loans ranges from 1.000% per
annum to 1.250% per annum, and the Applicable Rate
for Base Rate loans ranges from 0.000% per annum
to 0.250% per annum. Undrawn amounts under the
Credit Facility are subject to a commitment fee ranging
from 0.150% to 0.200%.

interest at a rate equal

Notes to Consolidated Financial Statements

During fiscal 2022, there were no borrowings under
the Revolving Facility.

During fiscal 2021,
the Company made principal
payments totaling $2.5 million on the term loan under
the 2017 Credit Agreement (the “2017 Term Loan”).
On the closing date of the 2020 Credit Agreement, the
Company repaid the remaining principal balance of
$97.5 million
and
concurrently drew $200.0 million under
the 2020
Term Loan.

the 2017 Term Loan

on

During fiscal 2021,
the Company made principal
payments totaling $2.5 million on the 2020 Term
Loan. During fiscal 2022, the Company repaid the
remaining principal balance of $197.5 million on the
2020 Term Loan. Interest paid on the 2017 Term
Loan and the 2020 Term Loan during fiscal years
2022, 2021 and 2020 was $1.7 million, $2.1 million
and $2.4 million, respectively.

contains

The 2020 Credit
various
Agreement
conditions, covenants and representations with which
the Company must be in compliance in order to borrow
funds and to avoid an event of default. As of April 2,
2022, the Company was in compliance with these
covenants.

the Company

Senior Notes due 2024
issued
On December 14, 2021,
$500.0 million aggregate principal amount of
its
1.750% senior notes due 2024 (the “2024 Notes”).
Interest is payable on the 2024 Notes on June 15 and
December 15 of each year, commencing June 15,
2022. The 2024 Notes will mature on December 15,
2024, unless earlier redeemed in accordance with
their terms. The 2024 Notes are senior unsecured
obligations of the Company and are guaranteed, jointly
and severally, by the Guarantors.

The Company used a portion of the net proceeds of
the offering of the 2024 Notes to repay all of the
outstanding 2020 Term Loan, as described above,
and will use the remainder of the net proceeds for
general corporate purposes.

The 2024 Notes were issued pursuant
to an
indenture, dated as of December 14, 2021 (the
“2021 Indenture”), by and among the Company, the
Guarantors and Computershare Trust Company, N.A.,
as trustee. The 2021 Indenture contains customary
events of default, including payment default, exchange
default, failure to provide certain notices thereunder
and certain provisions related to bankruptcy events.
The 2021 Indenture also contains customary negative
covenants.

The 2024 Notes have not been registered under the
Securities Act of 1933, as amended (the “Securities

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

Act”), or any state securities laws, and, unless so
registered, may not be offered or sold in the United
States absent registration or an applicable exemption
from the registration requirements of the Securities
Act and applicable state securities laws.

a

into

entered

In connection with the offering of the 2024 Notes, the
Company
Rights
Agreement, dated as of December 14, 2021 (the
“Registration Rights Agreement”), by and among the
Company and the Guarantors, on the one hand, and
BofA Securities, Inc., as representative of the initial
purchasers of the 2024 Notes, on the other hand.

Registration

(the

statement

registration

Agreement,

the Registration Rights

Under
the
Company and the Guarantors have agreed to use their
commercially reasonable efforts to (i) file with the SEC
a
“Exchange Offer
Registration Statement”)
relating to the registered
exchange offer (the “Exchange Offer”) to exchange the
the Company’s
2024 Notes for a new series of
exchange notes having terms substantially identical in
all material respects to, and in the same aggregate
principal amount as, the 2024 Notes; (ii) cause the
Exchange Offer Registration Statement to be declared
effective by the SEC; and (iii) cause the Exchange
Offer to be consummated no later than the 720th day
after December 14, 2021 (or if such 720th day is not
a business day, the next succeeding business day).

Under certain circumstances, the Company and the
Guarantors have agreed to use their commercially
reasonable efforts to (i)
registration
statement relating to the resale of the 2024 Notes as
promptly as practicable, and (ii) cause the shelf
registration statement to be declared effective by the
SEC as promptly as practicable.

file a shelf

If the Company fails to meet any of these targets, the
annual interest rate on the 2024 Notes will increase
by 0.25% during the 90-day period following the
default and will
increase by an additional 0.25% for
each subsequent 90-day period during which the
default continues, up to a maximum additional interest
rate of 1.00% per year. If the Company cures the
default, the interest rate on the 2024 Notes will revert
to the original level.

the Company

Senior Notes due 2029
issued
On September 30, 2019,
$350.0 million aggregate principal amount of
its
4.375% senior notes due 2029 (the “Initial 2029
Notes”). On December 20, 2019 and June 11, 2020,
the Company issued an additional $200.0 million and
$300.0 million,
respectively, aggregate principal
amount of such notes (together, the “Additional 2029
Notes” and collectively with the Initial 2029 Notes, the
“2029 Notes”). The 2029 Notes will mature on

55

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

Notes to Consolidated Financial Statements

redeemed in
October 15, 2029, unless earlier
accordance with their
terms. The 2029 Notes are
senior unsecured obligations of the Company and are
guaranteed, jointly and severally, by the Guarantors.

The Initial 2029 Notes were issued pursuant to an
indenture, dated as of September 30, 2019, by and
among the Company, the Guarantors and MUFG Union
Bank, N.A., as trustee, and the Additional 2029 Notes
were issued pursuant
indentures,
dated as of December 20, 2019 and June 11, 2020
indentures,
(such
collectively,
The 2019
Indenture contains substantially the same customary
events of default and negative covenants as the 2021
Indenture.

supplemental
and
“2019 Indenture”).

indenture
the

to supplemental

to 100% of

At any time prior to October 15, 2024, the Company
may redeem all or part of the 2029 Notes, at a
their principal
redemption price equal
amount, plus a “make whole” premium as of the
redemption date, and accrued and unpaid interest. In
addition, at any time prior to October 15, 2024, the
Company may redeem up to 35% of
the original
aggregate principal amount of the 2029 Notes with
the proceeds of one or more equity offerings, at a
redemption price equal to 104.375%, plus accrued
and unpaid interest. Furthermore, at any time on or
after October 15, 2024, the Company may redeem the
2029 Notes, in whole or in part, at the redemption
prices specified in the 2019 Indenture, plus accrued
and unpaid interest.

Interest is payable on the 2029 Notes on April 15 and
October 15 of each year. Interest paid on the 2029
Notes during fiscal
years 2022 and 2021 was
$37.2 million and $31.6 million, respectively.

the Company

Senior Notes due 2031
issued
On September 29, 2020,
$700.0 million aggregate principal amount of
its
3.375% senior notes due 2031 (the “2031 Notes”).
The 2031 Notes will mature on April 1, 2031, unless
earlier redeemed in accordance with their terms. The
2031 Notes are senior unsecured obligations of the
Company and are guaranteed, jointly and severally, by
the Guarantors.

The 2031 Notes were issued pursuant
to an
indenture, dated as of September 29, 2020, by and
among the Company, the Guarantors and MUFG Union
Bank, N.A., as trustee (the “2020 Indenture”). The
the same
2020 Indenture contains substantially
customary events of default and negative covenants
as the 2021 Indenture.

At any time prior to April 1, 2026, the Company may
redeem all or part of the 2031 Notes, at a redemption

56

price equal to 100% of their principal amount, plus a
“make whole” premium as of the redemption date,
and accrued and unpaid interest. In addition, at any
time prior to April 1, 2026, the Company may redeem
up to 40% of the original aggregate principal amount
of the 2031 Notes with the proceeds of one or more
equity offerings, at a redemption price equal
to
103.375%,
interest.
accrued
Furthermore, at any time on or after April 1, 2026, the
Company may redeem the 2031 Notes, in whole or in
part, at the redemption prices specified in the 2020
Indenture, plus accrued and unpaid interest.

unpaid

plus

and

The 2031 Notes have not been and will not be
registered under
the Securities Act, or any state
securities laws, and may not be offered or sold in the
United States absent an applicable exemption from
the registration requirements of the Securities Act and
applicable state securities laws.

Interest is payable on the 2031 Notes on April 1 and
October 1 of each year. Interest paid on the 2031
Notes during fiscal
years 2022 and 2021 was
$23.6 million and $11.9 million, respectively.

Senior Notes due 2025
On December 1, 2020, the Company redeemed the
remaining $23.4 million principal amount of its 7.00%
senior notes due December 1, 2025 (the “2025
Notes”) using cash on hand, at a redemption price
the principal amount, plus
equal
to 103.50% of
accrued and unpaid interest.
Interest paid on the
2025 Notes during both fiscal years 2021 and 2020
was $1.6 million.

Senior Notes due 2026
On October 16, 2020, the Company redeemed the
$900.0 million aggregate principal amount of
its
5.50% senior notes due July 15, 2026 (the “2026
Notes”) at a redemption price equal to 106.363% of
the $900.0 million principal amount, plus accrued and
unpaid interest. The 2026 Notes were redeemed
using proceeds from the issuance of the 2031 Notes
combined with cash on hand plus borrowings under
the 2020 Term Loan.
In connection with the
redemption, the Company recognized a loss on debt
extinguishment of $61.0 million as “Other (expense)
in the fiscal 2021 Consolidated
income, net”
Statement
debt
of
extinguishment
$57.3 million
redemption premium and a $3.7 million net write-off of
unamortized debt issuance costs and bond premium.
The primary purpose of the redemption was to reduce
future interest expense.

Income.
consisted

The
of

loss

on

a

Interest paid on the 2026 Notes during fiscal years
2021 and 2020 was $37.3 million and $49.5 million,
respectively.

Notes to Consolidated Financial Statements

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

to

(compared

respectively

Fair Value of Long-Term Debt
The Company’s debt is carried at amortized cost and
is measured at
fair value quarterly for disclosure
purposes. The estimated fair value of the 2024 Notes,
the 2029 Notes and the 2031 Notes as of April 2,
2022 was $476.9 million, $852.6 million and
$638.6 million,
the
outstanding principal amount of $500.0 million,
$850.0 million and $700.0 million, respectively). The
estimated fair value of the 2029 Notes and the 2031
Notes as of April 3, 2021 was $905.3 million and
$689.5 million,
the
outstanding principal amount of $850.0 million and
$700.0 million, respectively). The Company considers
its debt to be Level 2 in the fair value hierarchy. Fair
values are estimated based on quoted market prices
for identical or similar instruments. The 2024 Notes,
the 2029 Notes and the 2031 Notes currently trade
over-the-counter and the fair values were estimated
based upon the value of the last trade at the end of
the period.

respectively

(compared

to

fiscal

2022,

the Company

Interest Expense
recognized
During
$67.0 million of interest expense primarily related to
the 2029 Notes and the 2031 Notes, which was
partially offset by $3.7 million of interest capitalized to
the
property and equipment. During fiscal 2021,
Company recognized $79.3 million of interest expense
primarily related to the 2026 Notes (redeemed on
October 16, 2020), the 2029 Notes and the 2031
Notes, which was partially offset by $4.1 million of
interest capitalized to property and equipment. During
fiscal 2020, the Company recognized $66.0 million of
interest expense primarily related to the 2026 Notes
and the 2029 Notes, which was partially offset by
$5.6 million of interest capitalized to property and
equipment.

10. RETIREMENT BENEFIT PLANS

offers

differing

Company

tax-beneficial

Defined Contribution Plans
The
retirement
contribution plans to eligible employees in the U.S.
and certain other countries. Eligible employees in
certain countries outside of the U.S. are eligible to
participate in stakeholder, group or national pension
plans with
contributory
requirements based on local and national regulations.
U.S. employees are eligible to participate in the
Company’s fully qualified 401(k) plan 30 days after
their date of hire. An employee may contribute and
invest pretax and/or Roth dollars into the 401(k) plan
up to the maximum legal limits (as defined by Federal
regulations). Employer contributions to the 401(k) plan
are made at the discretion of the Company’s Board of

eligibility

and

Directors. Employees are immediately vested in their
own contributions as well as employer matching
contributions.

In total,
the Company contributed $17.6 million,
$15.6 million and $14.4 million to its domestic and
foreign defined contribution plans during fiscal years
2022, 2021 and 2020, respectively.

valued

assets

program with

Defined Benefit Pension Plans
The Company maintains two qualified defined benefit
pension plans for its subsidiaries located in Germany.
the plans is funded through a self-paid
One of
reinsurance
at
$3.8 million as of April 2, 2022 and April 3, 2021
(included in “Other non-current assets”
in the
Consolidated Balance Sheets). The pension benefit
obligations of both plans were $12.1 million and
$14.0 million as of April 2, 2022 and April 3, 2021,
respectively, which is included in “Accrued liabilities”
and “Other long-term liabilities” in the Consolidated
Balance Sheets. The benefit obligations for the plans
are calculated annually by an independent actuary and
including
require the use of significant
assumptions based on local economic conditions. The
net
approximately
$0.6 million for each of the last three fiscal years.

cost was

judgement

periodic

benefit

The

becomes

insolvent.

that
amount

the Company’s creditors in the event

Non-Qualified Deferred Compensation Plan
Certain employees and members of
the Board of
Directors are eligible to participate in the Company’s
Non-Qualified Deferred Compensation Plan (“NQDC
Plan”). The NQDC Plan provides eligible participants
the opportunity
to defer and invest a specified
percentage of their cash compensation. The NQDC
Plan is a non-qualified plan that is maintained in a
rabbi trust, which restricts the Company’s use and
access to the assets held, but is subject to the claims
the
of
Company
of
compensation to be deferred by each participant is
based on their own elections and is adjusted for any
investment changes that the participant directs. This
plan does not provide for employer contributions. The
deferred compensation obligation and the fair value of
the investments held in the rabbi
trust were
$39.4 million and $32.8 million as of April 2, 2022
and April 3, 2021, respectively. The current portion of
the deferred compensation obligation and fair value of
the assets held in the rabbi trust were $1.5 million
and $1.2 million as of April 2, 2022 and April 3,
2021, respectively, and are included in “Other current
assets” and “Accrued liabilities” in the Consolidated
Balance Sheets. The non-current portion of
the
deferred compensation obligation and fair value of the
assets held in the rabbi trust were $37.9 million and

57

The

Company

estimated.

Legal Matters
The Company is involved in various legal proceedings
and claims that have arisen in the ordinary course of
business that have not been fully adjudicated. The
Company accrues a liability for legal contingencies
when it believes that it is both probable that a liability
has been incurred and the amount of the loss can be
reasonably
regularly
evaluates developments in its legal matters that could
affect the amount of the previously accrued liability
and records adjustments as appropriate. Although it is
not possible to predict with certainty the outcome of
the unresolved legal matters,
is the opinion of
management that these matters will not, individually
or in the aggregate, have a material adverse effect on
the Company’s consolidated financial position or
results of operations.
The aggregate range of
reasonably possible losses in excess of accrued
liabilities,
if any, associated with these unresolved
legal matters is not material.

it

12. RESTRUCTURING

recorded restructuring

During fiscal years 2022, 2021 and 2020,
the
related charges
Company
totaling approximately $2.1 million, $2.7 million and
$47.9 million, respectively, related primarily to fiscal
2019 actions to reduce operating expenses and
improve manufacturing cost structure and other
individually
plans.
Restructuring accrual balances were immaterial as of
April 2, 2022 and April 3, 2021.

restructuring

immaterial

13.

INCOME TAXES

Income (loss) before income taxes consists of the
following components (in thousands):

Fiscal Year
2021

United States $
Foreign
Total

2022
69,938 $125,362 $(226,005)
621,094
$1,181,084 $807,380 $ 395,089

1,111,146

682,018

2020

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

Notes to Consolidated Financial Statements

$31.6 million as of April 2, 2022 and April 3, 2021,
respectively, and are included in “Other non-current
assets” and “Other
long-term liabilities” in the
Consolidated Balance Sheets.

11. COMMITMENTS AND CONTINGENT LIABILITIES

of

to

pay

million,

Purchase Obligations
As of April 2, 2022,
the Company’s purchase
obligations (including capital commitments)
totaled
which
$2,156.7
approximately
approximately $1,018.6 million is expected to be paid
during fiscal 2023. In subsequent years, the Company
expects
approximately $495.3 million,
$405.9 million, $236.6 million and $0.3 million
related to these purchase obligations during fiscal
respectively.
years 2024, 2025, 2026 and 2027,
Noncancelable
represent
obligations
payments due related to the purchase of materials,
manufacturing services and property and equipment, a
majority of which are not recorded as liabilities in the
Consolidated Balance Sheet because the Company
has not received the related goods or services as of
April 2, 2022.

purchase

Amidst ongoing industry-wide supply constraints, the
Company entered into a long-term capacity reservation
agreement with a foundry supplier during the second
quarter ended October 2, 2021. The Company agreed
to pay certain fees and deposits which are recorded in
“Prepaid expenses” and “Other non-current assets” in
the Consolidated Balance Sheet as of April 2, 2022.
the Company is required to
Under
is required to
purchase, and the foundry supplier
supply, a certain number of wafers (at predetermined
sales prices) for calendar years 2022 through 2025.
As of April 2, 2022, the Company estimates that it is
obligated to purchase approximately $1.4 billion of
wafers (included in the total purchase obligations
above) under the capacity reservation agreement.

the agreement

Lease Commitments
See Note 8 for disclosures related to lease
commitments.

58

Notes to Consolidated Financial Statements

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

The components of the income tax provision are as follows (in thousands):

2022

Fiscal Year
2021

2020

Current tax expense:

Federal
State
Foreign

Deferred tax (expense) benefit:

Federal
State
Foreign

Total

$ (16,886) $(11,043) $ (6,705)
(93)
(65,065)
(71,863)

(274)
(98,696)
(115,856)

(140)
(80,722)
(91,905)

$ (18,398) $(35,545) $ 7,826
4,603
(1,330)
11,099
$(147,731) $(73,769) $(60,764)

(2,762)
(10,715)
(31,875)

(3,771)
57,452
18,136

A reconciliation of the provision for income taxes to income tax expense computed by applying the statutory federal
income tax rate to pre-tax income for fiscal years 2022, 2021 and 2020 is as follows (dollars in thousands):

Income tax expense at statutory

federal rate

(Increase) decrease resulting from:
State (expense)/benefit, net of

federal impact

Tax credits
Effect of changes in income tax rate

applied to net deferred tax assets (1)

Foreign tax rate difference
Foreign permanent differences and

related items

Change in valuation allowance
Expiration of state and foreign

attributes

Stock-based compensation
Tax reserve adjustments
U.S. tax on foreign earnings,
including GILTI & FDII (2)

Permanent reinvestment assertion
Impairments and acquisition related

adjustments

Other income tax (expense) benefit

2022

Fiscal Year
2021

2020

Amount

Percentage

Amount

Percentage

Amount

Percentage

$(248,028)

21.0%

$(169,550)

21.0%

$(82,969)

21.0%

(1,888)
118,877

0.2
(10.1)

(25,679)
148,932

2.2
(12.6)

786
231

(3,048)
11,148
(3,262)

(130,874)
(1,033)

(12,198)
(1,695)

(0.1)
(0.1)

0.3
(0.9)
0.3

11.1
0.1

1.0
0.1

(743)
92,532

22,286
85,851

9,026
(1,232)

(1,656)
9,545
(9,979)

(100,830)
(8,488)

(919)
388

0.1
(11.5)

(2.8)
(10.6)

(1.1)
0.2

0.2
(1.2)
1.2

12.5
1.1

0.1
(0.1)

2,605
64,017

(2,269)
75,247

(5,446)
6,438

(5,165)
(1,707)
(13,973)

(81,916)
(6,814)

(7,257)
(1,555)

(0.7)
(16.2)

0.6
(19.0)

1.4
(1.6)

1.3
0.4
3.5

20.8
1.7

1.8
0.4

$(147,731)

12.5%

$ (73,769)

9.1%

$(60,764)

15.4%

(1) In fiscal 2022, the Company negotiated an extension to its tax holiday in Singapore, resulting in the revaluation of its deferred tax
assets. As a result, the Company recognized an income tax expense of $26.4 million due to the reduced tax rate, in part from a
reversal of the tax benefit recognized in fiscal 2021. In fiscal 2021, the Company completed the restructuring of the Cavendish
intellectual property, resulting in the recognition of an income tax benefit of $22.1 million in Singapore.

(2) The Global Intangible Low-Taxed Income (“GILTI”) and Foreign-Derived Intangible Income (“FDII”) provisions became effective for the
Company in fiscal 2019, at which time the Company elected to treat taxes due on future GILTI inclusions in U.S. taxable income as
current-period expense (the “period cost method”).

59

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

Notes to Consolidated Financial Statements

Deferred income taxes reflect the net tax effects of
temporary differences between the carrying amounts
of assets and liabilities for
reporting
purposes and the basis used for income tax purposes.
The deferred income tax assets and liabilities are
measured in each taxing jurisdiction using the enacted
tax rates and laws that will be in effect when the
differences are expected to reverse.

financial

Significant components of the Company’s net deferred
income taxes are as follows (in thousands):

April 2, 2022 April 3, 2021

Deferred income tax assets:

Inventory reserve

Equity compensation

Net operating loss carry-forwards

$ 11,592 $

9,632

13,085

27,024

14,444

24,474

Research and other credits

56,735

106,825

Employee benefits

Lease liabilities

Other deferred assets

21,104

17,905

10,332

19,357

15,947

8,662

Total deferred income tax assets

157,777

199,341

Valuation allowance

(36,281)

(36,512)

Total deferred income tax assets,

net of valuation allowance

$ 121,496 $ 162,829

Deferred income tax liabilities:

Amortization and purchase

accounting basis difference

$ (73,412) $ (25,553)

Accumulated depreciation/basis

difference

(53,425)

(59,756)

Accrued tax on unremitted

foreign earnings

(22,988)

(21,747)

Deferred intercompany

revenue (1)

—

(22,284)

Right-of-use assets

(16,591)

(14,663)

Other deferred liabilities

(2,884)

(1,681)

Total deferred income tax liabilities

(169,300)

(145,684)

Net deferred income tax

(liability) asset

Amounts included in the

Consolidated Balance Sheets:

$ (47,804) $ 17,145

Other non-current assets

$ 36,824 $ 59,056

Other long-term liabilities

(84,628)

(41,911)

Net deferred income tax

(liability) asset

$ (47,804) $ 17,145

(1) In fiscal 2021, the Company completed the intercompany
restructuring of the Cavendish intellectual property. Due to
this transaction, a portion of
revenue recognized by the
intercompany seller is taxable in future years. The remaining
deferred intercompany revenue was taxed during fiscal 2022.

60

The Company has recorded a valuation allowance
against certain U.S. and foreign deferred tax assets as
of April 2, 2022 and April 3, 2021. These valuation
allowances
upon
management’s opinion that it is more likely than not
(a likelihood of more than 50 percent) that the benefit
of these deferred tax assets may not be realized.

established

based

were

The valuation allowance against deferred tax assets
decreased by approximately $0.2 million in fiscal
2022. The decrease was comprised of a $1.6 million
decrease for the valuation allowance against deferred
tax assets for net operating losses and other deferred
tax assets at foreign subsidiaries and a $1.4 million
increase in the valuation allowance against certain
domestic deferred tax assets for net operating losses
and credits. At the end of fiscal 2022, a $1.3 million
valuation allowance remained against deferred tax
assets at foreign subsidiaries, and a $34.9 million
domestic
valuation
deferred tax assets.

allowance

remained

against

The valuation allowance against deferred tax assets
increased by $1.2 million in fiscal 2021. The increase
was comprised of a $2.1 million increase in the
valuation allowance against certain domestic deferred
tax assets for net operating losses and credits and a
$0.9 million decrease for
the valuation allowance
against deferred tax assets for net operating losses at
fiscal 2021, a
foreign subsidiaries. At
$2.9 million valuation allowance remained against
deferred tax assets at
foreign subsidiaries, and a
$33.6 million valuation allowance remained against
state deferred tax assets.

the end of

The valuation allowance against deferred tax assets
decreased by $5.2 million in fiscal 2020. The
decrease was comprised of a $7.9 million decrease in
the valuation allowance against state deferred tax
assets for net operating losses and tax credits and a
$2.7 million increase for
the valuation allowance
against deferred tax assets for net operating losses at
foreign subsidiaries. At
fiscal 2020, a
$3.8 million valuation allowance remained against
deferred tax assets at
foreign subsidiaries, and a
$31.5 million valuation allowance remained against
state deferred tax assets.

the end of

years 2023 to 2042,

loss
As of April 2, 2022, the Company had federal
carryovers of approximately $53.3 million that expire
in fiscal years 2023 to 2042, if unused, and state
losses of approximately $122.2 million that expire in
if unused. Federal
fiscal
research credits of $110.2 million, and state credits
of $65.4 million expire in fiscal years 2031 to 2042
and 2023 to 2042, respectively. The Company had
foreign losses of $100.0 million, which expire in fiscal
if unused. The utilization of
years 2023 to 2032,

Notes to Consolidated Financial Statements

acquired domestic tax assets is subject to certain
annual
limitations as required under Section 382 of
the Internal Revenue Code of 1986, as amended (the
“Code”) and similar state income tax provisions.

in

its

increase

investments

The Company has continued to expand its operations
and
numerous
international jurisdictions. These activities expose the
Company to taxation in multiple foreign jurisdictions.
As a result, management has concluded that it is not
its
permanently reinvested on certain earnings of
foreign subsidiaries which have been subject to U.S.
federal
the Company’s
untaxed foreign earnings and historic investments will
continue to be permanently reinvested to fund working
capital requirements and operations abroad. It is not
practical to estimate the additional tax that would be
incurred, if any, if the remainder of the permanently
reinvested earnings were repatriated.

taxation. The remainder of

The Company has foreign subsidiaries with tax holiday
agreements in Costa Rica and Singapore. The
Company’s tax holiday in Costa Rica is set to expire in
December 2027. During fiscal 2022, the Company
in
negotiated an extension to its tax holiday
Singapore, now expiring in December 2031. Incentives
to the Company
from these countries are subject
investment
meeting
and
requirements. Relative to the statutory
tax rate,
income tax expense decreased by $128.4 million (an
impact of approximately $1.17 and $1.15 per basic
and diluted share, respectively) in fiscal 2022 and
$74.3 million (an impact of approximately $0.65 and
$0.64 per basic and diluted share, respectively) in
fiscal 2021 as a result of these agreements.

employment

certain

of

3,

as

April

The Company’s gross unrecognized tax benefits
totaled $144.1 million as of April 2, 2022,
and
2021,
$134.1 million
these
$119.2 million as of March 28, 2020. Of
amounts, $137.5 million, $128.7 million
and
$114.8 million as of April 2, 2022, April 3, 2021
and March 28, 2020,
the
if
amounts of unrecognized tax benefits that,
recognized, would impact the effective tax rate in each
of the fiscal years.

respectively,

represent

The Company’s gross unrecognized tax benefits
increased from $134.1 million as of April 3, 2021 to
$144.1 million as of April 2, 2022, primarily due to
increases related to current year tax positions, the
effect of provision-to-return adjustments on prior year
business
positions
combinations
purchase
accounting.

related
part

recognized

increases

to
of

and

as

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

A reconciliation of fiscal 2020 through fiscal 2022
beginning and ending amount of gross unrecognized
tax benefits is as follows (in thousands):

2022

Fiscal Year
2021

2020

Beginning balance

$134,068

$119,222

$103,178

Additions based on

positions related to
current year

Additions for tax

positions in prior
years

Reductions for tax
positions in prior
years

Expiration of statute

of limitations

Settlements

11,826

10,048

10,357

3,049

6,240

6,484

(1,669)

(348)

(69)

(3,219)

(1,094)

—

—

(728)

—

Ending balance

$144,055

$134,068

$119,222

It is the Company’s policy to recognize interest and
penalties related to uncertain tax positions as a
component of income tax expense. During fiscal years
the Company recognized
2022, 2021 and 2020,
$(5.1) million, $0.8 million and $0.7 million,
respectively, of
interest and penalties related to
uncertain tax positions. Accrued interest and penalties
totaled
related
$1.0 million, $6.2 million and $5.4 million as of
April 2, 2022, April 3, 2021 and March 28, 2020,
respectively.

unrecognized

benefits

tax

to

The unrecognized tax benefits of $144.1 million and
accrued interest and penalties of $1.0 million at the
end of fiscal 2022 are recorded on the Consolidated
Balance Sheet as a $13.8 million other
long-term
liability, with the balance reducing the carrying value of
the gross deferred tax assets.

to

the

timing

if any,

regarding

uncertainties

Due
of
examinations and the amount of settlements that may
be paid,
the Company
currently believes it is reasonably possible that only a
minimal amount of gross unrecognized tax benefits
will be reduced for tax positions taken in prior years
within the next 12 months.

to tax authorities,

in

and

state

federal

income tax
Qorvo files a consolidated U.S.
return, as well as separate and combined income tax
international
returns
numerous
jurisdictions. Qorvo’s fiscal 2019 U.S.
federal and
state tax returns and subsequent tax years remain
open for examination, as well as all attributes brought
forward into those years. The Company is also subject
to examination by various international tax authorities.
The tax
to examination vary by
jurisdiction.

years subject

61

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

Notes to Consolidated Financial Statements

14. NET INCOME PER SHARE

The following table sets forth the computation of basic and diluted net income per share (in thousands, except per
share data):

Fiscal Year

2022

2021

2020

Numerator:

Numerator for basic and diluted net income per share — net income

available to common stockholders

$1,033,353 $733,611 $334,325

Denominator:

Denominator for basic net income per share — weighted average shares

110,196

114,034

117,007

Effect of dilutive securities:

Stock-based awards

Denominator for diluted net income per share — adjusted weighted

average shares and assumed conversions

Basic net income per share

Diluted net income per share

1,350

1,982

2,286

111,546

116,016

119,293

$

$

9.38 $

6.43 $

9.26 $

6.32 $

2.86

2.80

In the computation of diluted net income per share for fiscal years 2022, 2021 and 2020, an immaterial number of
shares were excluded because the effect of their inclusion would have been antidilutive.

15. STOCK-BASED COMPENSATION

Summary of Stock Plans

of

the

upon

closing

2009 and 2012 Incentive Plans — TriQuint
Semiconductor, Inc.
Effective
the Business
Combination, the Company assumed the TriQuint, Inc.
Inc. 2012
2009 Incentive Plan and the TriQuint,
Incentive Plan (the “TriQuint
Incentive Plans”),
originally adopted by TriQuint. The TriQuint Incentive
Plans provided for
the grant of stock options,
restricted stock units, stock appreciation rights and
other stock or cash awards to employees, officers,
and
directors,
independent
its
subsidiaries and affiliates. The options granted
thereunder were required to have an exercise price per
share no less than 100% of the fair market value per
share on the date of grant. The terms of each grant
under
not
exceed ten years. No further awards can be granted
under these plans.

Incentive Plans

consultants,

contractors

advisors

TriQuint

TriQuint

agents,

could

and

the

of

2012 Stock Incentive Plan — Qorvo, Inc.
The Company currently grants stock options and
restricted stock units to employees and directors
the 2012 Stock Incentive Plan (the “2012
under
Plan”), which was approved by
the Company’s
stockholders on August 16, 2012, assumed by the
Business
Company

connection

with

the

in

62

stock

rights,

restricted

Combination and reapproved by
the Company’s
stockholders on August 8, 2017 for purposes of
Section 162(m) of the Code. Under the 2012 Plan, the
Company is permitted to grant stock options and other
types of equity incentive awards, such as stock
appreciation
awards,
performance shares and performance units. The
maximum number of shares issuable under the 2012
Plan may not exceed the sum of
(a) 4.3 million
shares, plus (b) any shares of common stock
(i) remaining available for issuance as of the effective
date of the 2012 Plan under the Company’s prior
plans and (ii) subject to an award granted under a
prior plan, which awards are forfeited, canceled,
terminated, expire or
lapse for any reason. As of
April 2, 2022, 2.6 million shares were available for
issuance under the 2012 Plan. The aggregate number
of shares subject
to performance-based restricted
stock units awarded for fiscal 2022 under the 2012
Plan was 0.1 million shares.

of

the

upon

closing

2013 Incentive Plan — Qorvo, Inc.
Effective
the Business
Combination, the Company assumed the TriQuint, Inc.
2013 Incentive Plan (the “2013 Incentive Plan”),
originally adopted by TriQuint, allowing Qorvo to issue
awards under
this plan. The 2013 Incentive Plan
replaces the TriQuint 2012 Incentive Plan and
provides for
restricted
stock units, stock appreciation rights and other stock

the grant of stock options,

Notes to Consolidated Financial Statements

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

and

agents,

advisors

or cash awards to employees, officers, directors,
consultants,
independent
contractors of TriQuint and its subsidiaries and
to the Business
affiliates who were such prior
the
Combination or who become employed by
the
the closing of
its affiliates after
Company or
Business Combination. Former employees, officers
and directors of RFMD are not eligible for awards
under the 2013 Incentive Plan. The options granted
thereunder must have an exercise price per share no
less than 100% of the fair market value per share on
the date of grant. The terms of each grant under the
2013 Incentive Plan may not exceed ten years. As of
April 2, 2022, 0.5 million shares were available for
issuance under the 2013 Incentive Plan.

inducement

2015 Inducement Stock Plan — Qorvo, Inc.
The 2015 Inducement Stock Plan (the “2015
Inducement Plan”) provides for the grant of equity
to
awards to persons as a material
become employees of the Company or its affiliates.
The plan provides for
the grant of stock options,
restricted stock units, stock appreciation rights and
other stock-based awards. The maximum number of
shares issuable under the 2015 Inducement Plan may
not exceed the sum of (a) 0.3 million shares, plus
(b) any shares of common stock (i) remaining available
for issuance as of the effective date of the 2015
the TriQuint 2008
Inducement Stock Plan under
Inducement Award Plan and (ii) subject to an award
granted under the TriQuint 2008 Inducement Award
Plan,
canceled,
are
terminated, expire or lapse for any reason. No awards
were made under the 2015 Inducement Plan in fiscal
years 2022, 2021 and 2020. As of April 2, 2022,
0.3 million shares were available for issuance under
the 2015 Inducement Plan.

forfeited,

awards

which

regular

Employee Stock Purchase Plan — Qorvo, Inc.
Effective upon closing of the Business Combination,
the Company assumed the TriQuint Employee Stock
Purchase Plan (“ESPP”), which is intended to qualify
as an “employee stock purchase plan” under
Section 423 of
full-time
the Code. All
employees of the Company (including officers) and all
other employees who meet the eligibility requirements
of the plan may participate in the ESPP. The ESPP
provides eligible employees an opportunity to acquire
the Company’s common stock at 85.0% of the lower
the Company’s
of
last day of each
common stock on the first or
six-month purchase period. At April 2, 2022,
3.0 million shares were available for future issuance
under
this plan. The Company makes no cash
contributions to the ESPP, but bears the expenses of
its administration. The Company issued 0.3 million

the closing price per share of

shares under the ESPP in fiscal 2022, 0.4 million
shares in fiscal 2021 and 0.5 million shares in fiscal
2020.

For fiscal years 2022, 2021 and 2020, the primary
stock-based awards and their general terms and
conditions are as follows:
Restricted stock units granted by the Company in
fiscal years 2022, 2021 and 2020 are either service-
based or performance and service-based. Service-
based restricted stock units generally vest over a four-
year period from the grant date. Performance and
service-based restricted stock units are earned based
on Company performance of stated metrics during the
fiscal year and, if earned, generally vest one-half when
earned and the balance over two years. Restricted
stock
directors
to
generally vest over a one-year period from the grant
date. In fiscal 2022, each non-employee director was
eligible to receive an annual grant of restricted stock
units.

non-employee

granted

units

to

the

officer

subject

executing

The options and restricted stock units granted to
certain officers of the Company generally will, in the
event of the officer’s termination other than for cause
and
certain
agreements in favor of the Company, continue to vest
pursuant to the same vesting schedule as if the officer
had remained an employee of the Company and, as a
result, these awards are expensed at grant date. In
fiscal
of
$19.7 million was recognized upon the grant of
0.1 million restricted share units to certain officers of
the Company.

compensation

stock-based

2022,

Stock-Based Compensation
Under ASC 718, stock-based compensation cost is
measured at the grant date, based on the estimated
fair value of the award using an option pricing model
for stock options (Black-Scholes) and market price for
restricted stock units, and is recognized as expense
over the employee’s requisite service period. ASC 718
covers a wide range of stock-based compensation
arrangements including stock options, restricted share
plans, performance-based awards, share appreciation
rights and employee stock purchase plans.

Total pre-tax stock-based compensation expense
recognized in the Consolidated Statements of Income
was $83.5 million, $89.3 million and $76.0 million,
for fiscal years 2022, 2021 and 2020, respectively,
net of expense capitalized into inventory.

63

258

$15.67

1.04

$27,270

Balance at April 2, 2022

1,539

$126.46

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

Notes to Consolidated Financial Statements

A summary of activity with respect to stock options
under the Company’s director and employee stock
plans follows:

Weighted-
Average
Remaining
Contractual
Term
(in years)

Weighted-
Average
Exercise
Price

Aggregate
Intrinsic
Value
(in thousands)

Options
(in thousands)

458

$17.21

—

—

(193)

$18.57

(7)

—

$35.37

—

Outstanding as of
April 3, 2021

Granted

Exercised

Canceled

Forfeited

Outstanding as of
April 2, 2022

Vested and

expected to
vest as of
April 2, 2022

Options exercisable

as of
April 2, 2022

258

$15.67

1.04

$27,270

258

$15.67

1.04

$27,270

The aggregate intrinsic value in the table above
represents the total pre-tax intrinsic value, based upon
the Company’s closing stock price of $121.51 as of
April 1, 2022 (the last Nasdaq trading day prior to the
fiscal year end on April 2, 2022), that would have
been received by the option holders had all option
holders with in-the-money options exercised their
options as of that date. As of April 2, 2022, there was
no remaining unearned compensation cost related to
unvested option awards.

The fair value of each option award is estimated on
the date of grant using a Black-Scholes option-pricing
model based on the expected volatility, dividend yield,
term and risk-free interest rate. There were no options
granted during fiscal years 2022, 2021 and 2020.

intrinsic value of options exercised during
The total
fiscal years 2022, 2021 and 2020 was $27.1 million,
$66.7 million and $65.1 million, respectively.

Cash received from the exercise of stock options and
from participation in the employee stock purchase
plan (excluding accrued unremitted employee funds)
was approximately $36.9 million for fiscal 2022 and is
reflected in cash flows from financing activities in the
Consolidated Statement of Cash Flows. The Company
settles employee stock options with newly issued
shares of the Company’s common stock.

ASC 718 requires forfeitures to be estimated at the
time of grant and revised, if necessary, in subsequent
from those
periods

forfeitures differ

if actual

64

estimates. Based upon historical pre-vesting forfeiture
experience,
the Company assumed an annualized
forfeiture rate of 1.4% for both stock options and
restricted stock units.

A summary of activity with respect to restricted
stock unit awards (“RSUs”) under the Company’s
director and employee stock plans follows:

RSUs
(in thousands)

Weighted-Average
Grant-Date
Fair Value

Balance at April 3, 2021

1,859

$ 93.22

Granted

Vested
Forfeited

670

(874)
(116)

185.26

87.78
124.95

total

remaining unearned
As of April 2, 2022,
related to unvested restricted
compensation cost
stock units was $121.0 million, which will be
amortized over the weighted-average remaining service
period of approximately 1.2 years.

The total intrinsic value of restricted stock units that
vested during fiscal years 2022, 2021 and 2020 was
$163.6 million, $121.8 million and $67.7 million,
respectively, based upon the fair market value of the
Company’s common stock on the vesting date.

16. STOCKHOLDERS’ EQUITY

Stock Repurchase
On October 31, 2019, the Company announced that
its Board of Directors authorized a share repurchase
program to repurchase up to $1.0 billion of
the
Company’s outstanding common stock, which included
approximately $117.0 million authorized under a prior
program which was terminated concurrent with this
authorization. On May 5, 2021,
the Company
announced that its Board of Directors authorized a
new share repurchase program to repurchase up to
$2.0 billion of the Company’s outstanding common
stock, which included approximately $236.9 million
authorized
on
October 31, 2019, which was terminated concurrent
with the new authorization. As of April 2, 2022, there
was $861.7 million of availability under the share
repurchase program.

program announced

under

the

Under
the Company’s share repurchase programs,
repurchases are made in accordance with applicable
securities laws on the open market or in privately
to which the
negotiated transactions. The extent
Company repurchases its shares,
the number of
shares and the timing of any repurchases depends on
general market conditions, regulatory requirements,
other
alternative

opportunities

investment

and

Notes to Consolidated Financial Statements

considerations. The current program does not require
the Company to repurchase a minimum number of
shares, does not have a fixed term, and may be
modified, suspended or terminated at any time without
prior notice.

repurchased 7.3 million shares,
The Company
3.6 million shares and 6.4 million shares of
its
common stock during fiscal years 2022, 2021 and
2020,
of
$1,152.3 million, $515.1 million and $515.1 million,
respectively.

respectively,

aggregate

cost

an

at

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

Common Stock Reserved For Future Issuance
At April 2, 2022, the Company had reserved a total of
authorized
approximately
8.2 million
405.0 million shares of common stock for
future
issuance as follows (in thousands):

its

of

Outstanding stock options under formal directors’

and employees’ stock option plans

Possible future issuance under Company stock

incentive plans

Employee stock purchase plan
Restricted stock-based units outstanding

Total shares reserved

258

3,424
2,984
1,539

8,205

17. OPERATING SEGMENT AND GEOGRAPHIC INFORMATION

The Company’s operating and reportable segments as of April 2, 2022 are MP and IDP based on the organizational
structure and information reviewed by the Company’s Chief Executive Officer, who is the Company’s chief operating
decision maker
(“CODM”), and these segments are managed separately based on the end markets and
applications they support. The CODM allocates resources and assesses the performance of each operating
segment primarily based on operating income.

MP is a global supplier of cellular, UWB, Wi-Fi and other wireless solutions for a variety of applications, including
smartphones, wearables, laptops, tablets and IoT.

IDP is a global supplier of RF, system-on-a-chip and power management solutions for a wide range of markets,
including cellular and IT infrastructure, automotive, renewable energy, defense and IoT.

The “All other” category includes operating expenses such as stock-based compensation expense, amortization of
impairment,
intangible assets, acquisition and integration related costs, restructuring related charges, goodwill
fixed asset impairments, (loss) gain on sale of fixed assets, start-up costs and other miscellaneous corporate
overhead expenses that the Company does not allocate to its operating segments because these expenses are not
included in the segment operating performance measures evaluated by the Company’s CODM. The Company’s
operating segments do not record intercompany revenue. The Company does not allocate gains and losses from
investments, interest and other income (expense) or taxes to operating segments. The CODM does not evaluate
operating segments using discrete asset information. Except as discussed above regarding the “All other”
category, the Company’s accounting policies for segment reporting are the same as for the Company as a whole.

The following tables present details of the Company’s operating and reportable segments and a reconciliation of
the “All other” category (in thousands):

Revenue:

MP

IDP

Total revenue

Operating income (loss):

MP

IDP

All other

Operating income

Interest expense

Other income (expense), net

Income before income taxes

2022

Fiscal Year
2021

2020

$3,545,253

$2,856,813

$2,397,740

1,100,461

1,158,494

841,401

$4,645,714

$4,015,307

$3,239,141

$1,290,132

$1,008,171

$ 715,514

261,511

283,507

145,295

(325,574)

(385,051)

(437,593)

1,226,069

906,627

423,216

(63,326)

18,341

(75,198)

(24,049)

(60,392)

32,265

$1,181,084

$ 807,380

$ 395,089

65

Qorvo, Inc. and Subsidiaries Annual Report on Form 10-K 2022

Notes to Consolidated Financial Statements

Reconciliation of “All other” category:
Stock-based compensation expense
Amortization of intangible assets
Acquisition and integration related costs
Restructuring related charges
Goodwill impairment
Other (1)

Loss from operations for “All other”

2022

Fiscal Year
2021

2020

$ (83,507) $ (89,322) $ (75,978)
(246,563)
(252,137)
(61,891)
(32,946)
(47,869)
(2,722)
—
—
(5,292)
(7,924)

(150,128)
(27,964)
(2,121)
(48,000)
(13,854)

$(325,574) $(385,051) $(437,593)

(1) Other includes fixed asset impairments, (loss) gain on sale of fixed assets, start-up costs and other miscellaneous corporate overhead expenses.

The consolidated financial statements include revenue to customers by geographic region (based on the location of
the customers’ headquarters) that are summarized as follows (in thousands):

Revenue:

United States
China
Other Asia
Taiwan
Europe

Total Revenue

2022

Fiscal Year
2021

2020

$1,928,403
1,499,212
620,620
345,869
251,610

$1,631,110
1,579,017
363,523
248,708
192,949

$1,468,358
1,106,679
340,400
169,337
154,367

$4,645,714

$4,015,307

$3,239,141

The consolidated financial statements include the following long-lived tangible asset amounts related to operations
of the Company by geographic region (in thousands):

Long-lived tangible assets:
United States
China
Other countries

April 2, 2022 April 3, 2021

$1,007,463
192,416
53,712

$1,011,686
200,346
53,999

66

Report of Independent Registered Public Accounting Firm

To the Stockholders and the Board of Directors of Qorvo, Inc.

Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Qorvo, Inc. and subsidiaries (the Company) as
of April 2, 2022 and April 3, 2021, the related consolidated statements of income, comprehensive income,
stockholders’ equity and cash flows for each of the three years in the period ended April 2, 2022, and the related
notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial
statements present fairly, in all material respects, the financial position of the Company at April 2, 2022 and
April 3, 2021, and the results of its operations and its cash flows for each of the three years in the period ended
April 2, 2022, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States) (PCAOB), the Company’s internal control over financial reporting as of April 2, 2022, based on criteria
established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the
Treadway Commission (2013 framework) and our report dated May 20, 2022 expressed an unqualified opinion
thereon.

Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express
an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered
with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.
federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and
the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial statements are free of material
misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of
material misstatement of the financial statements, whether due to error or fraud, and performing procedures that
respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and
disclosures in the financial statements. Our audits also included evaluating the accounting principles used and
significant estimates made by management, as well as evaluating the overall presentation of the financial
statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the financial
statements that was communicated or required to be communicated to the audit committee and that: (1) relates to
accounts or disclosures that are material to the financial statements and (2) involved our especially challenging,
subjective or complex judgments. The communication of the critical audit matter does not alter in any way our
opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical
audit matter below, providing a separate opinion on the critical audit matter or on the account or disclosure to
which it relates.

67

Inventory—Valuation
Description of the
Matter

How We
Addressed the
Matter in Our Audit

the Company assesses the valuation of all

The Company’s inventory, net totaled $755.7 million as of April 2, 2022, representing
approximately 10% of total assets. As explained in Note 1 to the consolidated financial
statements,
inventories including
manufacturing raw materials, work-in-process, and finished goods each reporting period.
Obsolete inventory or inventory in excess of management’s estimated demand forecasts
is written down to its estimated net realizable value if less than cost by recording an
inventory reserve at each reporting period.

Auditing management’s estimates for inventory reserves involved subjective auditor
judgment because the assessment considers a number of factors, including estimated
customer demand forecasts, technological obsolescence risks, and possible alternative
uses that are affected at least partially by market and economic conditions outside the
Company’s control.

We obtained an understanding, evaluated the design and tested the operating
effectiveness of controls over the Company’s inventory reserve process. This included
testing controls over management’s review of the assumptions and data underlying the
inventory reserves, such as demand forecasts and consideration of how factors outside
of the Company’s control might affect the valuation of obsolete and excess inventory.

Our audit procedures included, among others, evaluating the significant assumptions
(e.g., customer demand forecasts, technological and/or market obsolescence, and
possible alternative uses) and the accuracy and completeness of underlying data used in
management’s assessment of
inventory reserves. We evaluated inventory levels
compared to forecasted demand, historical sales and specific product considerations.
We also assessed the historical accuracy of management’s estimates for both the
forecast assumptions and the reserve estimate.

We have served as the Company’s auditor since 2018.
Raleigh, North Carolina
May 20, 2022

/s/ Ernst & Young LLP

68

Report of Independent Registered Public Accounting Firm

To the Stockholders and the Board of Directors of Qorvo, Inc.

Opinion on Internal Control over Financial Reporting
We have audited Qorvo, Inc. and subsidiaries’ internal control over financial reporting as of April 2, 2022, based on
criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations
of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, Qorvo, Inc. and subsidiaries (the
Company) maintained, in all material respects, effective internal control over financial reporting as of April 2, 2022,
based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States) (PCAOB), the consolidated balance sheets of the Company as of April 2, 2022 and April 3, 2021, the
related consolidated statements of income, comprehensive income, stockholders’ equity and cash flows for each
of the three years in the period ended April 2, 2022, and the related notes and our report dated May 20, 2022
expressed an unqualified opinion thereon.

Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for
its assessment of the effectiveness of internal control over financial reporting included in the accompanying
Management’s Assessment of Internal Control Over Financial Reporting. Our responsibility is to express an opinion
on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm
registered with the PCAOB and are required to be independent with respect to the Company in accordance with the
U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission
and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting
was maintained in all material respects.

Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a
material weakness exists, testing and evaluating the design and operating effectiveness of internal control based
on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We
believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles. A company’s internal control over financial reporting
includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail,
accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable
assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance
with generally accepted accounting principles, and that receipts and expenditures of the company are being made
only in accordance with authorizations of management and directors of the company; and (3) provide reasonable
assurance regarding prevention or
the
company’s assets that could have a material effect on the financial statements.

timely detection of unauthorized acquisition, use, or disposition of

its inherent

Because of
reporting may not prevent or detect
misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that
controls may become inadequate because of changes in conditions, or that the degree of compliance with the
policies or procedures may deteriorate.

internal control over

limitations,

financial

Raleigh, North Carolina
May 20, 2022

/s/ Ernst & Young LLP

69

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH

ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.

Not applicable.

ITEM 9A. CONTROLS AND PROCEDURES.

(a) Evaluation of disclosure controls and procedures

Disclosure controls and procedures refer to controls
and other procedures designed to ensure that
information required to be disclosed in the reports we
file or submit under the Exchange Act is recorded,
processed, summarized and reported within the time
periods specified in the rules and forms of the SEC.
Disclosure controls and procedures include, without
limitation, controls and procedures designed to ensure
that information required to be disclosed by us in our
reports that we file or submit under the Exchange Act
is
our
management, including our Chief Executive Officer and
Interim Chief Financial Officer, as appropriate, to allow
timely decisions regarding our required disclosure. In
designing and evaluating our disclosure controls and
procedures, our management
recognizes that any
controls and procedures, no matter how well designed
and operated, can provide only reasonable assurance
of achieving the desired control objectives.

communicated

accumulated

and

to

As of the end of the period covered by this report, the
Company’s management, including our Chief Executive
Officer and Interim Chief Financial Officer, evaluated
the effectiveness of
the Company’s disclosure
controls and procedures in accordance with Rule
13a-15 under
the Exchange Act. Based on this
evaluation, our Chief Executive Officer and Interim
Chief Financial Officer concluded that the Company’s
disclosure controls and procedures were effective, as
of such date,
to enable the Company to record,
process, summarize and report in a timely manner the
information that the Company is required to disclose
in its Exchange Act reports. Our Chief Executive Officer
and Interim Chief Financial Officer also concluded that
the Company’s disclosure controls and procedures
were effective, as of the end of the period covered by
this report, in ensuring that information required to be
disclosed by the Company in the reports that it files or
submits under the Exchange Act is accumulated and
communicated
the Company’s management,
including our Chief Executive Officer and Interim Chief
Financial Officer, as appropriate,
to allow timely
decisions regarding required disclosure.

to

for

financial

statements

internal
those

board of directors, management and other personnel,
to provide reasonable assurance regarding
the
reliability of financial reporting and the preparation of
external
consolidated
purposes in accordance with U.S. generally accepted
control over
accounting principles. Our
financial
and
policies
includes
reporting
procedures that (1) pertain to the maintenance of
records that, in reasonable detail, accurately and fairly
reflect the transactions and dispositions of assets of
the Company, (2) provide reasonable assurance that
transactions are recorded as necessary to permit
preparation of consolidated financial statements for
external purposes in accordance with U.S. generally
accepted accounting principles and that receipts and
expenditures of the Company are being made only in
accordance with authorizations of management and
directors of the Company, and (3) provide reasonable
assurance regarding prevention or timely detection of
unauthorized acquisition, use or disposition of assets
that could have a material effect on the consolidated
financial statements.

Management assessed the effectiveness of our
internal control over financial reporting as of April 2,
2022. Management based this assessment on criteria
for effective internal control over financial reporting
described in Internal Control-Integrated Framework
(2013)
the Committee of Sponsoring
Organizations of the Treadway Commission (“COSO”).

issued by

the Company’s internal control over

Based on this assessment, management concluded
that
financial
reporting was effective as of April 2, 2022, based on
Control-Integrated
the
Framework (2013) issued by the COSO.

Internal

criteria

the

in

Ernst & Young LLP, an independent registered public
accounting firm, has issued an unqualified opinion on
the effectiveness of the Company’s internal control
over financial reporting, as of April 2, 2022, which is
included in this Annual Report on Form 10-K under
Part
and
Item 8,
Supplementary Data.”

Statements

“Financial

II,

(c) Changes in internal control over financial reporting

financial

There were no changes in our Company’s internal
control over
reporting during the quarter
ended April 2, 2022 that have materially affected, or
are reasonably likely to materially affect, our internal
control over financial reporting.

ITEM 9B. OTHER INFORMATION.

(b) Management’s assessment of internal control over
financial reporting

Not applicable.

of

The Company’s management
is responsible for
establishing and maintaining adequate internal control
over financial reporting and for the assessment of the
financial
effectiveness
reporting as defined in Rules 13a-15(f) and 15d-15(f)
under
internal control over
financial reporting is a process designed by and under
the supervision of our Chief Executive Officer and
Interim Chief Financial Officer and effected by our

the Exchange Act. Our

internal

control

over

70

ITEM 9C. DISCLOSURE REGARDING FOREIGN

JURISDICTIONS THAT PREVENT
INSPECTIONS.

Not applicable.

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND
CORPORATE GOVERNANCE.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND
MANAGEMENT AND RELATED
STOCKHOLDER MATTERS.

of

Information required by this Item may be found in our
for our 2022 Annual
definitive proxy statement
Meeting
captions
the
under
Stockholders
“Corporate Governance,” “Executive Officers” and
“Proposal 1 — Election of Directors,” and the
information
by
reference.

incorporated

therein

herein

is

The Company has adopted its “Code of Business
Conduct and Ethics,” and a copy is posted on the
Company’s website at www.qorvo.com, on the
“Corporate Governance” tab under
the “Investor
Relations” page. In the event that we amend any of
the provisions of the Code of Business Conduct and
Ethics that requires disclosure under applicable law,
SEC rules or Nasdaq listing standards, we intend to
disclose such amendment on our website. Any waiver
of the Code of Business Conduct and Ethics for any
executive officer or director must be approved by the
Board and will be promptly disclosed, along with the
reasons for the waiver, as required by applicable law
or Nasdaq rules.

ITEM 11. EXECUTIVE COMPENSATION.

Information required by this Item may be found in our
definitive proxy statement
for our 2022 Annual
Meeting of Stockholders under the captions “Executive
Committee
Compensation”
the
Interlocks
and
information
by
reference.

Participation,”
incorporated

and
Insider
is

“Compensation

and
herein

therein

Information required by this Item may be found in our
definitive proxy statement
for our 2022 Annual
Meeting of Stockholders under the captions “Security
and
Ownership
Plan
Management”
Information,”
is
incorporated herein by reference.

Beneficial Owners
Compensation

“Equity
the

information

and
and

Certain

therein

of

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED

TRANSACTIONS, AND DIRECTOR
INDEPENDENCE.

Information required by this Item may be found in our
definitive proxy statement
for our 2022 Annual
Meeting of Stockholders under the captions “Related
Person Transactions” and “Corporate Governance,”
and the information therein is incorporated herein by
reference.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND

SERVICES.

Information required by this Item may be found in our
definitive proxy statement
for our 2022 Annual
Meeting of Stockholders under the captions “Proposal
3 — Ratification of Appointment of
Independent
Registered Public Accounting Firm” and “Corporate
Governance,”
is
incorporated herein by reference.

information

therein

and

the

71

PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

(a) The following documents are filed as part of this report:

(1) Financial Statements

i. Consolidated Balance Sheets as of April 2, 2022 and April 3, 2021.

ii. Consolidated Statements of Income for fiscal years 2022, 2021 and 2020.

iii. Consolidated Statements of Comprehensive Income for fiscal years 2022, 2021 and 2020.

iv. Consolidated Statements of Stockholders’ Equity for fiscal years 2022, 2021 and 2020.

v. Consolidated Statements of Cash Flows for fiscal years 2022, 2021 and 2020.

vi. Notes to Consolidated Financial Statements.

Reports of Independent Registered Public Accounting Firm.

(2) The financial statement schedules are not included in this item as they are either included within the
consolidated financial statements or the notes thereto in this Annual Report on Form 10-K or are inapplicable
and, therefore, have been omitted.

(3) The exhibits listed in the accompanying Exhibit Index are filed as a part of this Annual Report on Form
10-K.

(b) Exhibits.

See the Exhibit Index.

(c) Separate Financial Statements and Schedules.

None.

ITEM 16. FORM 10-K SUMMARY.

None.

72

Exhibit
No.

3.1

3.2

4.1

4.2

4.3

4.4

4.5

4.6

4.7

4.8

10.1

10.2

10.3

10.4

10.5

10.6

10.7

10.8

EXHIBIT INDEX

Description

Amended and Restated Certificate of
Inc., as amended (incorporated by
reference to Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q filed with the SEC on
February 3, 2015)

Incorporation of Qorvo,

Amended and Restated Bylaws of Qorvo, Inc., effective as of May 13, 2016 (incorporated by reference
to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the SEC on May 19, 2016)

Specimen Certificate of Common Stock of Qorvo, Inc. (incorporated by reference to Exhibit 4.1 to the
Company’s Annual Report on Form 10-K filed with the SEC on May 27, 2015)

Indenture, dated as of September 30, 2019, among Qorvo, Inc., the Guarantors party thereto and
Computershare Trust Company, N.A., as Successor Trustee to MUFG Union Bank, N.A. (incorporated by
reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the SEC on October 1,
2019)

Supplemental Indenture, dated as of December 20, 2019, among Qorvo, Inc., the Guarantors party
thereto and Computershare Trust Company, N.A., as Successor Trustee to MUFG Union Bank, N.A.
(incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the
SEC on December 20, 2019)

Second Supplemental Indenture, dated as of June 11, 2020, among Qorvo, Inc., the Guarantors party
thereto and Computershare Trust Company, N.A., as Successor Trustee to MUFG Union Bank, N.A.
(incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the
SEC on June 11, 2020)

Indenture, dated as of September 29, 2020, among Qorvo, Inc., the Guarantors and Computershare
Trust Company, N.A., as Successor Trustee to MUFG Union Bank, N.A. (incorporated by reference to
Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the SEC on September 29, 2020)

Indenture, dated as of December 14, 2021, among Qorvo, Inc., the Guarantors party thereto and
Computershare Trust Company, N.A., as Trustee (incorporated by reference to Exhibit 4.1 to the Current
Report on Form 8-K filed with the SEC on December 14, 2021)

Registration Rights Agreement, dated as of December 14, 2021, by and among Qorvo, Inc., the
Guarantors named therein and BofA Securities, Inc., as representative of the several Initial Purchasers
named therein (incorporated by reference to Exhibit 4.2 to the Current Report on Form 8-K filed with the
SEC on December 14, 2021)

Description of Securities (incorporated by reference to Exhibit 4.11 to the Company’s Annual Report on
Form 10-K filed with the SEC on May 17, 2019)

Qorvo, Inc. 2007 Employee Stock Purchase Plan (As Assumed and Amended by Qorvo, Inc., and as
(incorporated by reference to Exhibit 10.1 to the
further amended, effective February 8, 2017)
Company’s Annual Report on Form 10-K filed with the SEC on May 23, 2017)*

Qorvo, Inc. 2013 Incentive Plan (As Assumed and Amended by Qorvo, Inc.) (incorporated by reference to
Exhibit 99.2 to the Company’s Registration Statement on Form S-8 filed with the SEC on January 5,
2015 (File No. 333-201357))*

Qorvo, Inc. 2012 Incentive Plan (As Assumed by Qorvo, Inc.) (incorporated by reference to Exhibit 99.3
to the Company’s Registration Statement on Form S-8 filed with the SEC on January 5, 2015 (File
No. 333-201357))*

Qorvo, Inc. 2009 Incentive Plan (As Assumed by Qorvo, Inc.) (incorporated by reference to Exhibit 99.4
to the Company’s Registration Statement on Form S-8 filed with the SEC on January 5, 2015 (File
No. 333-201357))*

Qorvo, Inc. 2008 Inducement Program (As Assumed by Qorvo, Inc.) (incorporated by reference to Exhibit
99.5 to the Company’s Registration Statement on Form S-8 filed with the SEC on January 5, 2015 (File
No. 333-201357))*

Qorvo, Inc. 1996 Stock Incentive Program (As Assumed by Qorvo, Inc.) (incorporated by reference to
Exhibit 99.6 to the Company’s Registration Statement on Form S-8 filed with the SEC on January 5,
2015 (File No. 333-201357))*

Qorvo, Inc. 2012 Stock Incentive Plan (As Assumed by Qorvo, Inc. and Amended and Restated Effective
January 1, 2015) (incorporated by reference to Exhibit 99.1 to the Company’s Registration Statement
on Form S-8 filed with the SEC on January 5, 2015 (File No. 333-201358))*

2003 Stock Incentive Plan of Qorvo, Inc. (As Assumed and Amended by Qorvo, Inc. Effective January 1,
2015) (incorporated by reference to Exhibit 99.2 to the Company’s Registration Statement on Form S-8
filed with the SEC on January 5, 2015 (File No. 333-201358))*

73

Description

Qorvo, Inc. 2006 Directors Stock Option Plan (As Assumed by Qorvo, Inc. and Amended Effective
January 1, 2015) (incorporated by reference to Exhibit 99.3 to the Company’s Registration Statement
on Form S-8 filed with the SEC on January 5, 2015 (File No. 333-201358))*

Nonemployee Directors’ Stock Option Plan of Qorvo, Inc. (As Assumed by Qorvo, Inc. and Amended
Effective January 1, 2015) (incorporated by reference to Exhibit 99.4 to the Company’s Registration
Statement on Form S-8 filed with the SEC on January 5, 2015 (File No. 333-201358))*

Qorvo, Inc. 2015 Inducement Stock Plan (incorporated by reference to Exhibit 99.5 to the Company’s
Registration Statement on Form S-8 filed with the SEC on January 5, 2015 (File No. 333-201358))*

Qorvo, Inc. Form of Indemnification Agreement (incorporated by reference to Exhibit 10.1 to the
Company’s Current Report on Form 8-K filed with the SEC on January 5, 2015)*

Qorvo, Inc. Form of Change in Control Agreement (incorporated by reference to Exhibit 10.1 to the
Company’s Current Report on Form 8-K filed with the SEC on February 10, 2015)*

Qorvo,
Inc. Nonqualified Deferred Compensation Plan (As Assumed and Amended and Restated
Effective January 1, 2015) (incorporated by reference to Exhibit 10.15 to the Company’s Annual Report
on Form 10-K filed with the SEC on May 27, 2015)*

Qorvo, Inc. Cash Bonus Plan (As Assumed and Amended and Restated Effective January 1, 2015)
(incorporated by reference to Exhibit 10.16 to the Company’s Annual Report on Form 10-K filed with
the SEC on May 27, 2015)*

Employment Agreement, dated as of November 12, 2008, between RF Micro Devices, Inc. and Robert
A. Bruggeworth (As Assumed by Qorvo, Inc.) (incorporated by reference to Exhibit 10.1 to RFMD’s
Current Report on Form 8-K filed with the SEC on November 14, 2008 (File No. 000-22511))*

Form of Stock Option Agreement (Senior Officers) pursuant to the Qorvo, Inc. 2012 Stock Incentive
Plan (incorporated by reference to Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q filed
with the SEC on August 5, 2015)*

Form of Restricted Stock Unit Agreement (Service-Based Award for Senior Officers) pursuant to the
Qorvo, Inc. 2012 Stock Incentive Plan (incorporated by reference to Exhibit 10.4 to the Company’s
Quarterly Report on Form 10-Q filed with the SEC on August 5, 2015)*

Form of Restricted Stock Unit Agreement (Performance-Based and Service-Based Award for Senior
Officers) pursuant to the Qorvo, Inc. 2012 Stock Incentive Plan (incorporated by reference to Exhibit
10.5 to the Company’s Quarterly Report on Form 10-Q filed with the SEC on August 5, 2015)*

(Performance-Based Award for Senior Officers (TSR))
Form of Restricted Stock Unit Agreement
pursuant to the Qorvo, Inc. 2012 Stock Incentive Plan (incorporated by reference to Exhibit 10.6 to the
Company’s Quarterly Report on Form 10-Q filed with the SEC on August 5, 2015)*

Qorvo, Inc. Severance Benefits Plan and Summary Plan Description (incorporated by reference to
Exhibit 10.8 to the Company’s Quarterly Report on Form 10-Q filed with the SEC on August 5, 2015)*

Form of Stock Option Agreement (Senior Officers) pursuant to the Qorvo, Inc. 2012 Stock Incentive
Plan (incorporated by reference to Exhibit 10.30 to the Company’s Annual Report on Form 10-K filed
with the SEC on May 31, 2016)*

Form of Restricted Stock Unit Agreement (Service-Based Award for Senior Officers) pursuant to the
Qorvo, Inc. 2012 Stock Incentive Plan (incorporated by reference to Exhibit 10.31 to the Company’s
Annual Report on Form 10-K filed with the SEC on May 31, 2016)*

Form of Restricted Stock Unit Agreement (Performance-Based and Service-Based Award for Senior
Officers) pursuant to the Qorvo, Inc. 2012 Stock Incentive Plan (incorporated by reference to Exhibit
10.32 to the Company’s Annual Report on Form 10-K filed with the SEC on May 31, 2016)*

Form of Restricted Stock Unit Agreement
(Performance-Based Award for Senior Officers (TSR))
pursuant to the Qorvo, Inc. 2012 Stock Incentive Plan (incorporated by reference to Exhibit 10.33 to
the Company’s Annual Report on Form 10-K filed with the SEC on May 31, 2016)*

Form of Restricted Stock Unit Award Agreement (Director Annual/Supplemental RSU) pursuant to the
Qorvo, Inc. 2012 Stock Incentive Plan (incorporated by reference to Exhibit 10.34 to the Company’s
Annual Report on Form 10-K filed with the SEC on May 31, 2016)*

(deferral
Form of Restricted Stock Unit Award Agreement
election) pursuant to the Qorvo, Inc. 2012 Stock Incentive Plan (incorporated by reference to Exhibit
10.1 to the Company’s Quarterly Report on Form 10-Q filed with the SEC on August 5, 2016)*

(Director Annual/Supplemental RSUs)

Qorvo, Inc. Cash Bonus Plan (As Amended and Restated Through June 9, 2016) (incorporated by
reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed with the SEC on
November 7, 2016)*

Exhibit
No.

10.9

10.10

10.11

10.12

10.13

10.14

10.15

10.16

10.17

10.18

10.19

10.20

10.21

10.22

10.23

10.24

10.25

10.26

10.27

10.28

74

Exhibit
No.

10.29

10.30

10.31

10.32

10.33

10.34

10.35

10.36

10.37

10.38

10.39

21

22

23.1

31.1

31.2

32.1

32.2

101

104

Description

Qorvo, Inc. Short-Term Incentive Plan (As Amended and Restated Through May 11, 2017) (incorporated
by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on
May 17, 2017)*

2018 Declaration of Amendment to Qorvo, Inc. Nonqualified Deferred Compensation Plan, effective as
of April 1, 2018 (incorporated by reference to Exhibit 10.37 to the Company’s Annual Report on Form
10-K filed with the SEC on May 21, 2018)*

Second 2018 Declaration of Amendment to Qorvo, Inc. Nonqualified Deferred Compensation Plan,
dated as of October 8, 2018 (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly
Report on Form 10-Q filed with the SEC on February 7, 2019)*

2019 Declaration of Amendment to Qorvo, Inc. 2007 Employee Stock Purchase Plan, dated as of
October 30, 2019 (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on
Form 10-Q filed with the SEC on January 30, 2020)*

2019 Declaration of Amendment to Qorvo, Inc. Nonqualified Deferred Compensation Plan, dated as of
October 30, 2019 (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on
Form 10-Q filed with the SEC on January 30, 2020)*

Amended and Restated Credit Agreement, dated as of September 29, 2020, by and among Qorvo,
Inc., as the Borrower, certain subsidiaries of the Borrower identified therein, as the Guarantors, Bank
of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, the other lenders party
thereto, and Wells Fargo Bank, National Association, Citibank, N.A., TD Bank, National Association,
MUFG Bank, Ltd., PNC Bank, National Association, Bank of the West and Morgan Stanley Bank, N.A.,
as Co-Syndication Agents (incorporated by reference to Exhibit 10.1 to the Company’s Current Report
on Form 8-K filed with the SEC on September 29, 2020)

2020 Declaration of Amendment to Qorvo, Inc. Nonqualified Deferred Compensation Plan, dated as of
December 17, 2020 (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on
Form 10-Q filed with the SEC on February 4, 2021)*

2021 Declaration of Amendment to Qorvo, Inc. 2007 Employee Stock Purchase Plan (incorporated by
reference to Exhibit 10.38 to the Company’s Annual Report on Form 10-K filed with the SEC on
May 24, 2021)*

Severance Agreement and Release of All Claims, dated February 27, 2022, by and between James
Klein and Qorvo US, Inc.*

Advisory Agreement, dated March 1, 2022, by and between James L. Klein and Qorvo Biotechnologies,
LLC

LIBOR Transition Amendment, dated April 6, 2022, to Amended and Restated Credit Agreement, by
and among Qorvo, Inc., as the Borrower, and Bank of America, N.A., as Administrative Agent

Subsidiaries of Qorvo, Inc.

List of Subsidiary Guarantors

Consent of Independent Registered Public Accounting Firm

Certification of Periodic Report by Robert A. Bruggeworth, as Chief Executive Officer, pursuant to Rule
13a-14(a) or 15d-14(a) of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-
Oxley Act of 2002

Certification of Periodic Report by Grant A. Brown, as Interim Chief Financial Officer, pursuant to Rule
13a-14(a) or 15d-14(a) of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-
Oxley Act of 2002

Certification of Periodic Report by Robert A. Bruggeworth, as Chief Executive Officer, pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Certification of Periodic Report by Grant A. Brown, as Interim Chief Financial Officer, pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

(ii)

the Consolidated Statements of

The following materials from our Annual Report on Form 10-K for the fiscal year ended April 2, 2022,
formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) the Consolidated Balance
Sheets;
the Consolidated Statements of
Comprehensive Income; (iv) the Consolidated Statements of Stockholders’ Equity; (v) the Consolidated
Statements of Cash Flows; and (vi) the Notes to Consolidated Financial Statements.
The cover page from our Annual Report on Form 10-K for the year ended April 2, 2022, formatted in
iXBRL

Income;

(iii)

* Executive compensation plan or agreement

Our SEC file number for documents filed with the SEC pursuant to the Securities Exchange Act of 1934, as
amended, is 001-36801. The SEC file number for RFMD is 000-22511.

75

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

SIGNATURES

Date: May 20, 2022

QORVO, INC.

By:

/S/ ROBERT A. BRUGGEWORTH

Robert A. Bruggeworth
President and Chief Executive Officer

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and
appoints Robert A. Bruggeworth and Grant A. Brown and each of them, as true and lawful attorneys-in-fact and
agents, with full power of substitution and resubstitution for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments to this report, and to file the same, with all exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all which said attorneys-in-fact and agents or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the
following persons on behalf of the registrant and in the capacities indicated on May 20, 2022.

/S/ ROBERT A. BRUGGEWORTH

Name:

Robert A. Bruggeworth

Title:

President, Chief Executive Officer and Director
(Principal Executive Officer)

/S/ GRANT A. BROWN

Name:

Grant A. Brown

Title:

Vice President of Treasury and Interim Chief Financial Officer
(Principal Financial Officer)

/S/ GINA B. HARRISON

Name:

Gina B. Harrison

Title:

Vice President and Corporate Controller
(Principal Accounting Officer)

/S/ RALPH G. QUINSEY

Name:

Ralph G. Quinsey

Title:

Chairman of the Board of Directors

/S/ JUDY BRUNER

Name:

Judy Bruner

Title:

Director

/S/ JEFFERY R. GARDNER

Name:

Jeffery R. Gardner

Title:

Director

/S/ JOHN R. HARDING

Name:

John R. Harding

Title:

Director

/S/ DAVID H. Y. HO

Name:

David H. Y. Ho

Title:

Director

/S/ RODERICK D. NELSON

Name:

Roderick D. Nelson

Title:

Director

/S/ DR. WALDEN C. RHINES

Name:

Dr. Walden C. Rhines

Title:

Director

/S/ SUSAN L. SPRADLEY

Name:

Susan L. Spradley

Title:

Director

76

7628 Thorndike Road | Greensboro, NC 27409
www.qorvo.com