rfmd-20230930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


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

For the quarterly period ended September 30, 2023


☐			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		46-5288992
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

7628 Thorndike Road
Greensboro,	North Carolina	27409-9421
(Address of principal executive offices)		(Zip Code)

(336) 664-1233

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, $0.0001 par value

QRVO

The Nasdaq Stock Market LLC

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 þ 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 þ 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

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 is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No þ

As of October 26, 2023, there were 97,345,755 shares of the registrant’s common stock outstanding.

Table of Contents

QORVO, INC. AND SUBSIDIARIES

TABLE OF CONTENTS


			Page
PART I — FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited).
Condensed Consolidated Balance Sheets			4
Condensed Consolidated Statements of Income			5
Condensed Consolidated Statements of Comprehensive Income			6
Condensed Consolidated Statements of Stockholders' Equity			7
Condensed Consolidated Statements of Cash Flows			9
Notes to Condensed Consolidated Financial Statements			10

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.			20
Item 3. Quantitative and Qualitative Disclosures About Market Risk.			29
Item 4. Controls and Procedures.			29

PART II — OTHER INFORMATION

Item 1A. Risk Factors.			30
Item 2. Unregistered Sales of Equity Securities , Use of Proceeds , and Issuer Purchases of Equity Securities .			30
Item 5. Other Information.			31
Item 6. Exhibits.			32

SIGNATURES			33

Table of Contents

PART I — FINANCIAL INFORMATION

ITEM 1.

QORVO, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except per share data)

(Unaudited)


	September 30, 2023		April 1, 2023
ASSETS
Current assets:
Cash and cash equivalents	$	706,836	$	808,757
Accounts receivable, net of allowance of $494 and $369 as of September 30, 2023 and April 1, 2023, respectively	592,738		304,519
Inventories	839,855		796,596
Prepaid expenses	49,120		46,684
Other receivables	27,888		26,535
Other current assets	46,440		46,703
Total current assets	2,262,877		2,029,794
Property and equipment, net of accumulated depreciation of $1,976,429 and $1,900,317 as of September 30, 2023 and April 1, 2023, respectively	1,061,163		1,149,806
Goodwill	2,708,310		2,760,813
Intangible assets, net	473,164		537,703
Long-term investments	25,649		20,406
Other non-current assets	187,357		193,381
Total assets	$	6,718,520	$	6,691,903
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	275,256	$	210,701
Accrued liabilities	303,810		222,463
Other current liabilities	92,876		122,599
Total current liabilities	671,942		555,763
Long-term debt	2,048,585		2,048,073
Other long-term liabilities	180,807		185,273
Total liabilities	2,901,334		2,789,109
Commitments and contingent liabilities (Note 7)
Stockholders’ equity:
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; 97,506 and 98,649 shares issued and outstanding at September 30, 2023 and April 1, 2023, respectively	3,796,189		3,821,474
Accumulated other comprehensive loss	(13,609)		(3,175)
Retained earnings	34,606		84,495
Total stockholders’ equity	3,817,186		3,902,794
Total liabilities and stockholders’ equity	$	6,718,520	$	6,691,903

See accompanying Notes to Condensed Consolidated Financial Statements.

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QORVO, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share data)

(Unaudited)


	Three Months Ended				Six Months Ended
	September 30, 2023		October 1, 2022		September 30, 2023		October 1, 2022
Revenue	$	1,103,493	$	1,158,057	$	1,754,657	$	2,193,415
Cost of goods sold	613,803		619,130		1,035,897		1,279,238
Gross profit	489,690		538,927		718,760		914,177

Operating expenses:
Research and development	174,947		168,164		338,037		336,732
Selling, general and administrative	103,696		97,752		209,119		199,567
Other operating expense	59,619		11,449		68,312		14,457
Total operating expenses	338,262		277,365		615,468		550,756
Operating income	151,428		261,562		103,292		363,421

Interest expense	(17,121)		(16,904)		(34,382)		(34,156)
Other income (expense), net	5,211		2,214		18,927		(2,848)
Income before income taxes	139,518		246,872		87,837		326,417

Income tax expense	(42,057)		(58,257)		(33,956)		(68,918)
Net income	$	97,461	$	188,615	$	53,881	$	257,499

Net income per share:
Basic	$	1.00	$	1.83	$	0.55	$	2.48
Diluted	$	0.99	$	1.82	$	0.54	$	2.46

Weighted-average shares of common stock outstanding:
Basic	97,945		102,927		98,167		103,991
Diluted	98,590		103,674		98,892		104,817

See accompanying Notes to Condensed Consolidated Financial Statements.

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QORVO, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

(Unaudited)


	Three Months Ended				Six Months Ended
	September 30, 2023		October 1, 2022		September 30, 2023		October 1, 2022
Net income	$	97,461	$	188,615	$	53,881	$	257,499
Other comprehensive loss, net of tax:
Foreign currency translation adjustment, including intra-entity foreign currency transactions that are of a long-term investment nature	(9,569)		(23,811)		(10,428)		(47,026)
Reclassification adjustments, net of tax:
Amortization of pension actuarial (gain) loss	(3)		9		(6)		18
Other comprehensive loss	(9,572)		(23,802)		(10,434)		(47,008)
Total comprehensive income	$	87,889	$	164,813	$	43,447	$	210,491

See accompanying Notes to Condensed Consolidated Financial Statements.

QORVO, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(In thousands)

(Unaudited)


				Accumulated Other Comprehensive Loss		Retained Earnings
	Common Stock
Three Months Ended	Shares	Amount						Total
Balance, July 1, 2023	98,048	$	3,816,260	$	(4,037)	$	—	$	3,812,223
Net income	—	—		—		97,461		97,461
Other comprehensive loss	—	—		(9,572)		—		(9,572)
Exercise of stock options and vesting of restricted stock units, net of shares withheld for employee taxes	427	(19,741)		—		—		(19,741)
Repurchase of common stock, including transaction costs and excise tax	(969)	(37,699)		—		(62,855)		(100,554)
Stock-based compensation	—	37,369		—		—		37,369
Balance, September 30, 2023	97,506	$	3,796,189	$	(13,609)	$	34,606	$	3,817,186

Balance, July 2, 2022	103,340	$	3,962,499	$	(17,974)	$	356,080	$	4,300,605
Net income	—	—		—		188,615		188,615
Other comprehensive loss	—	—		(23,802)		—		(23,802)
Exercise of stock options and vesting of restricted stock units, net of shares withheld for employee taxes	372	(16,993)		—		—		(16,993)
Repurchase of common stock, including transaction costs	(1,651)	(63,309)		—		(96,748)		(160,057)
Stock-based compensation	—	33,772		—		—		33,772
Balance, October 1, 2022	102,061	$	3,915,969	$	(41,776)	$	447,947	$	4,322,140

See accompanying Notes to Condensed Consolidated Financial Statements.

QORVO, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(In thousands)

(Unaudited)


				Accumulated Other Comprehensive (Loss) Income		Retained Earnings
	Common Stock
Six Months Ended	Shares	Amount						Total
Balance, April 1, 2023	98,649	$	3,821,474	$	(3,175)	$	84,495	$	3,902,794
Net income	—	—		—		53,881		53,881
Other comprehensive loss	—	—		(10,434)		—		(10,434)
Exercise of stock options and vesting of restricted stock units, net of shares withheld for employee taxes	597	(24,163)		—		—		(24,163)
Issuance of common stock in connection with employee stock purchase plan	262	19,180		—		—		19,180
Repurchase of common stock, including transaction costs and excise tax	(2,002)	(97,396)		—		(103,770)		(201,166)
Stock-based compensation	—	77,094		—		—		77,094
Balance, September 30, 2023	97,506	$	3,796,189	$	(13,609)	$	34,606	$	3,817,186

Balance, April 2, 2022	106,303	$	4,035,849	$	5,232	$	512,137	$	4,553,218
Net income	—	—		—		257,499		257,499
Other comprehensive loss	—	—		(47,008)		—		(47,008)
Exercise of stock options and vesting of restricted stock units, net of shares withheld for employee taxes	509	(21,181)		—		—		(21,181)
Issuance of common stock in connection with employee stock purchase plan	195	18,893		—		—		18,893
Repurchase of common stock, including transaction costs	(4,946)	(188,410)		—		(321,689)		(510,099)
Stock-based compensation	—	70,818		—		—		70,818
Balance, October 1, 2022	102,061	$	3,915,969	$	(41,776)	$	447,947	$	4,322,140

See accompanying Notes to Condensed Consolidated Financial Statements.

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QORVO, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)


	Six Months Ended
	September 30, 2023		October 1, 2022
Cash flows from operating activities:
Net income	$	53,881	$	257,499
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	99,183		103,882
Intangible assets amortization	61,103		66,539
Deferred income taxes	1,629		(16,693)
Stock-based compensation expense	77,498		67,203
Other, net	64,377		58,804
Changes in operating assets and liabilities:
Accounts receivable, net	(288,221)		(75,728)
Inventories	(45,694)		(81,716)
Prepaid expenses and other assets	(2,547)		30,503
Accounts payable and accrued liabilities	148,616		65,012
Income taxes payable and receivable	(9,674)		3,518
Other liabilities	(22,253)		61,601
Net cash provided by operating activities	137,898		540,424
Cash flows from investing activities:
Purchase of property and equipment	(68,076)		(90,454)
Proceeds from sales of property and equipment	47,301		331
Other investing activities	(3,418)		5,841
Net cash used in investing activities	(24,193)		(84,282)
Cash flows from financing activities:
Repurchase of common stock, including transaction costs	(200,026)		(510,099)
Proceeds from the issuance of common stock	21,041		19,541
Tax withholding paid on behalf of employees for restricted stock units	(25,472)		(22,020)
Other financing activities	(9,854)		(379)
Net cash used in financing activities	(214,311)		(512,957)
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(1,501)		(4,237)
Net decrease in cash, cash equivalents and restricted cash	(102,107)		(61,052)
Cash, cash equivalents and restricted cash at the beginning of the period	808,943		972,805
Cash, cash equivalents and restricted cash at the end of the period	$	706,836	$	911,753

Reconciliation of cash, cash equivalents and restricted cash:
Cash and cash equivalents	$	706,836	$	911,570
Restricted cash included in "Other current assets" and "Other non-current assets"	—		183
Total cash, cash equivalents and restricted cash	$	706,836	$	911,753

Supplemental disclosure of cash flow information:
Capital expenditures included in liabilities	$	27,610	$	26,658

See accompanying Notes to Condensed Consolidated Financial Statements.

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QORVO, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

The accompanying Condensed Consolidated Financial Statements of Qorvo, Inc. and Subsidiaries (together, the "Company" or "Qorvo") have been prepared in conformity with accounting principles generally accepted in the United States ("U.S. GAAP"). The preparation of these financial statements requires management to make estimates and assumptions, which could differ materially from actual results. In addition, certain information or footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed, or omitted, pursuant to the rules and regulations of the United States Securities and Exchange Commission (the "SEC"). In the opinion of management, the financial statements include all adjustments (which are of a normal and recurring nature) necessary for the fair presentation of the results of the interim periods presented. These Condensed Consolidated Financial Statements should be read in conjunction with the Company's audited consolidated financial statements and notes thereto included in Qorvo’s Annual Report on Form 10-K for the fiscal year ended April 1, 2023.

The Condensed Consolidated Financial Statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. The Company operates under three segments, High Performance Analog ("HPA"), Connectivity and Sensors Group ("CSG") and Advanced Cellular Group ("ACG").

Certain prior period amounts have been reclassified to conform to the fiscal 2024 presentation.

The Company uses a 52- or 53-week fiscal year ending on the Saturday closest to March 31 of each year. Each fiscal year, the first quarter ends on the Saturday closest to June 30, the second quarter ends on the Saturday closest to September 30 and the third quarter ends on the Saturday closest to December 31. Fiscal years 2024 and 2023 are 52-week years.

2. INVENTORIES

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


	September 30, 2023		April 1, 2023
Raw materials	$	266,354	$	264,367
Work in process	421,295		345,545
Finished goods	152,206		186,684
Total inventories	$	839,855	$	796,596

3. GOODWILL AND INTANGIBLE ASSETS

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


	HPA		CSG		ACG		Total
Balance as of April 1, 2023 (1)	$	501,602	$	525,351	$	1,733,860	$	2,760,813
Goodwill impairment	—		(48,000)		—		(48,000)
Effect of changes in foreign currency exchange rates	—		(4,503)		—		(4,503)
Balance as of September 30, 2023 (1)	$	501,602	$	472,848	$	1,733,860	$	2,708,310

(1) The Company’s goodwill balance is presented net of accumulated impairment losses and write-offs totaling $730.0 million and $682.0 million as of September 30, 2023 and April 1, 2023, respectively, which were recognized in fiscal years 2009, 2013, 2014, 2022, 2023 and 2024.

During the second quarter of fiscal 2024, the Company completed an interim test for goodwill impairment as management determined, based on revisions to long-term forecasts, it was more likely than not that the fair value of a reporting unit within the CSG segment was below its carrying amount. The quantitative analysis, which considered the income approach and the market approach to estimate the reporting unit's fair value, resulted in a goodwill impairment charge of approximately $48.0 million, which was recorded in "Other operating expense" in the Condensed Consolidated Statements of Income.

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QORVO, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

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


	September 30, 2023				April 1, 2023
	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Developed technology	$	863,836	$	430,265	$	872,106	$	382,448
Customer relationships	87,040		58,551		104,616		67,485
Technology licenses	2,224		703		1,664		513
Trade names	910		901		910		789
In-process research and development	9,574		N/A		9,642		N/A
Total (1)	$	963,584	$	490,420	$	988,938	$	451,235

(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.

4. 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 September 30, 2023 and April 1, 2023 were $18.5 million and $20.4 million, respectively, and are classified as "Long-term investments" in the Condensed Consolidated Balance Sheets. During the three and six months ended September 30, 2023, the Company recorded a loss of $1.2 million and income of $0.9 million, respectively, based on its share of the limited partnerships' results. During the three and six months ended October 1, 2022, the Company recorded income of $1.2 million and $0.4 million, respectively, based on its share of the limited partnerships' results. These amounts are included in "Other income (expense), net" in the Condensed Consolidated Statements of Income. During the three and six months ended September 30, 2023, the Company received cash distributions of $2.3 million and $2.8 million, respectively, from these limited partnerships. No cash distributions were received during the three months ended October 1, 2022 and $2.0 million of cash distributions were received during the six months ended October 1, 2022. 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 Condensed Consolidated Statements of Cash Flows.

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QORVO, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

Fair Value of Financial Instruments

The following table sets forth, by level within the fair value hierarchy, financial assets and liabilities measured on a recurring basis (in thousands):


	Total		Quoted Prices In Active Markets For Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
September 30, 2023
Marketable equity securities	$	642	$	642	$	—	$	—
Invested funds in deferred compensation plan (1)	42,939		42,939		—		—

April 1, 2023
Marketable equity securities	$	1,094	$	1,094	$	—	$	—
Invested funds in deferred compensation plan (1)	40,653		40,653		—		—
Contingent earn-out liability (2)	(31,250)		—		—		(31,250)

(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 determined by quoted active market prices of the underlying investments.

(2) The fair value of the contingent consideration liability which related to the acquisition of United Silicon Carbide, Inc. was equal to the maximum amount payable at April 1, 2023 and was subsequently paid in the first quarter of fiscal 2024.

5. LONG-TERM DEBT

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


	September 30, 2023		April 1, 2023
1.750% senior notes due 2024	$	500,000	$	500,000
4.375% senior notes due 2029	850,000		850,000
3.375% senior notes due 2031	700,000		700,000
Finance leases and other	1,238		1,666
Unamortized premium, discount and issuance costs, net	(2,557)		(3,283)
Less current portion of long-term debt	(96)		(310)
Total long-term debt	$	2,048,585	$	2,048,073

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 "Credit Agreement") with Bank of America, N.A., acting as administrative agent, and a syndicate of lenders. The Credit Agreement amended and restated the previous credit agreement dated as of December 5, 2017. The Credit Agreement includes a senior revolving line of credit (the "Revolving Facility") of up to $300.0 million, and included a senior term loan that was fully repaid in fiscal 2022. The Revolving Facility is available to finance working capital, capital expenditures and other general corporate purposes.

Pursuant to the 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.

On April 6, 2022, the Company and the administrative agent entered into an amendment to the Credit Agreement (the "LIBOR Transition Amendment") to replace the London Interbank Offered Rate as a reference rate available for use in the computation of interest under the Credit Agreement. As a result of the LIBOR Transition Amendment, at the Company’s option, loans

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QORVO, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

under the Credit Agreement will bear interest at (i) the Applicable Rate (as defined in the Credit Agreement) plus the Term SOFR (as defined in the Credit Agreement) or (ii) 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 interest at a rate equal 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 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 Revolving Facility are subject to a commitment fee ranging from 0.150% to 0.200%.

On June 23, 2023, the Company entered into a second amendment to the Credit Agreement (the "Second Amendment"). The purpose of the Second Amendment was to amend certain covenants related to the Company’s ratio of Consolidated Funded Indebtedness to Consolidated EBITDA, as such terms are defined in the Credit Agreement (the "Consolidated Leverage Ratio"). The Second Amendment increased the maximum Consolidated Leverage Ratio to 4.00 to 1.00 for the fiscal quarters ended July 1, 2023 and September 30, 2023, and 3.50 to 1.00 for the fiscal quarters ending December 30, 2023 and March 30, 2024. For subsequent fiscal quarters, the maximum Consolidated Leverage Ratio will return to 3.00 to 1.00.

During the three and six months ended September 30, 2023, there were no borrowings under the Revolving Facility.

The Credit Agreement contains various conditions, covenants and representations with which the Company must be in compliance in order to borrow funds and to avoid an event of default. As of September 30, 2023, the Company was in compliance with these covenants.

Senior Notes due 2024

On December 14, 2021, the Company issued $500.0 million aggregate principal amount of its 1.750% senior notes due 2024 (the "2024 Notes"). 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 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.

In connection with the offering of the 2024 Notes, the Company entered into a Registration 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.

On September 13, 2023, pursuant to their obligations under the Registration Rights Agreement, the Company and the Guarantors filed with the SEC a registration statement relating to the registered exchange offer (the "Exchange Offer") to exchange the 2024 Notes for a new series of the Company's exchange notes having terms substantially identical in all material respects to, and in the same aggregate principal amount as, the 2024 Notes. On October 16, 2023, the Company and the Guarantors commenced the Exchange Offer, which is scheduled to expire on November 17, 2023, unless extended.

Interest is payable on the 2024 Notes on June 15 and December 15 of each year. The Company paid no interest on the 2024 Notes during the three months ended September 30, 2023 and October 1, 2022, and paid interest of $4.4 million during both the six months ended September 30, 2023 and October 1, 2022.

Senior Notes due 2029

On September 30, 2019, the Company issued $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 October 15, 2029, unless earlier redeemed in

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QORVO, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(Unaudited)

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 to supplemental indentures, dated as of December 20, 2019, and June 11, 2020 (such indenture and supplemental indentures, collectively, the "2019 Indenture"). The 2019 Indenture contains substantially the same customary events of default and negative covenants as the 2021 Indenture.

Interest is payable on the 2029 Notes on April 15 and October 15 of each year. The Company paid no interest on the 2029 Notes during the three months ended September 30, 2023 and October 1, 2022, and paid interest of $18.6 million during both the six months ended September 30, 2023 and October 1, 2022.

Senior Notes due 2031

On September 29, 2020, the Company issued $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 2020 Indenture contains substantially the same customary events of default and negative covenants as the 2021 Indenture.

Interest is payable on the 2031 Notes on April 1 and October 1 of each year. The Company paid no interest on the 2031 Notes during the three and six months ended September 30, 2023, and paid interest of $11.8 million during the three and six months ended October 1, 2022.

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 September 30, 2023 was $470.7 million, $751.1 million and $553.8 million, respectively (compared to the outstanding principal amount of $500.0 million, $850.0 million and $700.0 million, respectively). The estimated fair value of the 2024 Notes, the 2029 Notes and the 2031 Notes as of April 1, 2023 was $464.2 million, $785.9 million and $565.3 million, respectively (compared to the outstanding principal amount of $500.0 million, $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.

Interest Expense

SEC Form 10-Q filed by Qorvo Inc.