Forward-Looking Statements In addition to historical information, this filing contains statements relating to future events or our future results. These statements are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended (the "Securities Act") and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and are subject to the safe harbor provisions created by statute. Such forward-looking statements include, but are not limited to, statements with respect to our future revenue, increasing, continuing or strengthening, or decreasing or weakening, demand for our products, replacement demand, our research and development efforts, our ability to identify and realize new growth opportunities, our ability to control costs and our operational flexibility as a result of (among other factors): •our expectations regarding the potential impacts on our business of the COVID-19 pandemic, including supply chain disruptions, the economic and public health effects, and governmental and other responses to these impacts; •projected growth rates in the overall semiconductor industry, the semiconductor assembly equipment market, and the market for semiconductor packaging materials; and •projected demand for ball bonder, wedge bonder, advanced packaging and electronic assembly equipment and for tools, spare parts and services. Generally, words such as "may," "will," "should," "could," "anticipate," "expect," "intend," "estimate," "plan," "continue," "goal" and "believe," or the negative of or other variations on these and other similar expressions identify forward-looking statements. These forward-looking statements are made only as of the date of this filing. We do not undertake to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise. Forward-looking statements are based on current expectations and involve risks and uncertainties. Our future results could differ significantly from those expressed or implied by our forward-looking statements. These risks and uncertainties include, without limitation, those described below and under the heading "Risk Factors" in this report and in our Annual Report on Form 10-K for the fiscal year endedOctober 3, 2020 (our "Annual Report") and our other reports filed from time to time with theSecurities and Exchange Commission . This discussion should be read in conjunction with the Consolidated Condensed Financial Statements and Notes included in this report, as well as our audited financial statements included in our Annual Report. We operate in a rapidly changing and competitive environment. New risks emerge from time to time and it is not possible for us to predict all risks that may affect us. Given those risks and uncertainties, investors should not place undue reliance on forward-looking statements as predictions of actual results. OVERVIEWKulicke and Soffa Industries, Inc. ("we," "us," "our," or the "Company") is a leading provider of semiconductor, light-emitting diode ("LED") and electronic assembly solutions serving the global automotive, consumer, communications, computing and industrial markets. Founded in 1951, we pride ourselves on establishing foundations for technological advancement-creating, pioneering interconnect solutions that enable performance improvements, power efficiency, form-factor reductions and assembly excellence of current and next-generation semiconductor devices. Leveraging decades of development proficiency and extensive process technology expertise, our expanding portfolio provides equipment solutions, aftermarket products and services supporting a comprehensive set of interconnect technologies including wire bonding, advanced packaging, lithography, and electronics assembly. Dedicated to empowering technological discovery, always, we collaborate with customers and technology partners to push the boundaries of possibility, enabling a smarter future. We design, manufacture and sell capital equipment and tools used to assemble semiconductor devices, including integrated circuits, high and low powered discrete devices, LEDs, and power modules. In addition, we have a portfolio of equipment that is used to assemble components onto electronic circuit boards. We also service, maintain, repair and upgrade our equipment and sell consumable aftermarket tools for our and our peer companies' equipment. Our customers primarily consist of semiconductor device manufacturers, integrated device manufacturers ("IDMs"), outsourced semiconductor assembly and test providers ("OSATs"), other electronics manufacturers and automotive electronics suppliers. 30 -------------------------------------------------------------------------------- Table of Contents Our goal is to be the technology leader and the most competitive supplier in terms of cost and performance in each of our major product lines. Accordingly, we invest in research and engineering projects intended to enhance our position as a leader in semiconductor assembly technology. We also remain focused on our cost structure through continuous improvement and optimization of operations. Cost reduction efforts are an important part of our normal ongoing operations and are intended to generate savings without compromising overall product quality and service. We operate two reportable segments, consisting of Capital Equipment and Aftermarket Products and Services ("APS"). We have aggregated twelve operating segments as ofJuly 3, 2021 , with six operating segments within the Capital Equipment reportable segment and six operating segments within the APS reportable segment. Our Capital Equipment segment engages in the manufacture and sale of ball bonders, wafer level bonders, wedge bonders, advanced packaging and electronic assembly solutions to semiconductor device manufacturers, IDMs, OSATs, other electronics manufacturers and automotive electronics suppliers. Our APS segment engages in the manufacture and sale of a variety of tools for a broad range of semiconductor packaging applications, spare parts, equipment repair, maintenance and servicing, training services, refurbishment and upgrades for our equipment. Business Environment The semiconductor business environment is highly volatile and is driven by internal dynamics, both cyclical and seasonal, in addition to macroeconomic forces. Over the long term, semiconductor consumption has historically grown, and is forecast to continue to grow. This growth is driven, in part, by regular advances in device performance and by price declines that result from improvements in manufacturing technology. In order to exploit these trends, semiconductor manufacturers, both IDMs and OSATs, periodically invest aggressively in latest generation capital equipment. This buying pattern often leads to periods of excess supply and reduced capital spending-the so-called semiconductor cycle. Within this broad semiconductor cycle there are also, generally weaker, seasonal effects that are specifically tied to annual, end-consumer purchasing patterns. Typically, semiconductor manufacturers prepare for heightened demand by adding or replacing equipment capacity by the end of the September quarter. Occasionally, this results in subsequent reductions in the December quarter. This annual seasonality can be overshadowed by effects of the broader semiconductor cycle. Macroeconomic factors also affect the industry, primarily through their effect on business and consumer demand for electronic devices, as well as other products that have significant electronic content such as automobiles, white goods, and telecommunication equipment. There can be no assurances regarding levels of demand for our products and we believe historic industry-wide volatility will persist. In theAsia/Pacific region, our customer base has also become more geographically concentrated as a result of economic and industry conditions. Approximately 95.8% and 93.9% of our net revenue for the three months endedJuly 3, 2021 andJune 27, 2020 , respectively, was for shipments to customer locations outside of theU.S. , primarily in theAsia/Pacific region. Approximately 57.2% and 53.3% of our net revenue for the three months endedJuly 3, 2021 andJune 27, 2020 , respectively, was for shipments to customers located inChina , which is subject to risks and uncertainties related to the respective policies of the governments ofChina and theU.S. Similarly, approximately 96.6% and 93.5% of our net revenue for the nine months endedJuly 3, 2021 andJune 27, 2020 , respectively, was for shipments to customer locations outside of theU.S. , primarily in theAsia/Pacific region. Approximately 53.9% and 54.6% of our net revenue for the nine months endedJuly 3, 2021 andJune 27, 2020 , respectively, was for shipments to customers located inChina . TheU.S. and several other countries have levied tariffs on certain goods and have introduced other trade restrictions, which, together with the impact of the COVID-19 pandemic discussed below, has resulted in substantial uncertainties in the semiconductor, LED, memory and automotive market. Our Capital Equipment segment is primarily affected by the industry's internal cyclical and seasonal dynamics in addition to broader macroeconomic factors that can positively or negatively affect our financial performance. The sales mix of IDM and OSAT customers in any period also impacts financial performance, as changes in this mix can affect our products' average selling prices and gross margins due to differences in volume purchases and machine configurations required by each customer type. Our APS segment has historically been less volatile than our Capital Equipment segment. The APS sales are more directly tied to semiconductor unit consumption rather than capacity requirements and production capability improvements. 31 -------------------------------------------------------------------------------- Table of Contents We continue to position our business to leverage our research and development leadership and innovation and to focus our efforts on mitigating volatility, improving profitability and ensuring longer-term growth. We remain focused on operational excellence, expanding our product offerings and managing our business efficiently throughout the business cycles. Our visibility into future demand is generally limited, forecasting is difficult, and we generally experience typical industry seasonality. To limit potential adverse cyclical, seasonal and macroeconomic effects on our financial position, we have continued our efforts to maintain a strong balance sheet. As ofJuly 3, 2021 , our total cash, cash equivalents and short-term investments were$635.0 million , a$104.9 million increase from the prior fiscal year end. We believe our strong cash position will allow us to continue to invest in product development and pursue non-organic opportunities. Key Events in Fiscal 2021 Business Combinations OnJanuary 19, 2021 , we entered into and closed a Stock Purchase Agreement withUniqarta, Inc. ("Uniqarta") and the equity holders of Uniqarta to purchase all of Uniqarta's outstanding equity interests. The purchase price consisted of$26.5 million in cash paid at closing. Uniqarta is a developer of laser transfer technology and the acquisition expands our presence in the LED end market. Upon the closing of the acquisition onJanuary 19, 2021 , Uniqarta became our wholly-owned subsidiary. COVID-19 Pandemic The COVID-19 pandemic has significantly impacted the global economy, disrupted global supply chains, created volatility in equity market valuations, created significant volatility and disruption in financial markets, and significantly increased unemployment levels. In addition, the pandemic has resulted in temporary closures and failures of many businesses and the institution of social distancing and sheltering-in-place requirements in many jurisdictions. As these measures were relaxed, in certain jurisdictions there has been a resurgence of illnesses, which has led to more severe restrictions. In response to the pandemic, we temporarily closed certain offices inthe United States ,Europe andAsia as well as executed our Business Continuity Plan ("BCP"), which measures have disrupted how we operate our business. While we are currently operating at full capacity in all of our manufacturing locations, work-from-home practices were instituted across many offices worldwide, which have impacted our non-manufacturing productivity, including our research & development. At this point, our BCP has not included significant headcount reductions or changes in our overall liquidity position. As certain countries relaxed the measures over the past few months, we have restarted certain activities in accordance with local guidelines. We have not experienced significant delays in customer deliveries, but we are impacted by the global shortage in electronic components and our supply chain is strained in some cases as the availability of materials, logistics and freight options are challenging in many jurisdictions. Demand for our products was consistent with or exceeded our expectations for the third quarter of fiscal 2021. We believe semiconductor industry macroeconomics have not changed and we anticipate the industry's long-term growth projections will normalize, but the sector could see short-term volatility and potential disruption. Various countries have announced measures, including government grants, tax changes and tax credits, among other types of relief, in response to the pandemic. For fiscal 2021, we have received a$2.0 million COVID-19-related grant from theSingapore government as well as other measures including rental rebates and social insurance exemption, which are not material to our operating results. Based on our current evaluation, the pandemic has not had a material impact on our financial condition and operating results in fiscal 2021 to date. We believe that our existing cash, cash equivalents, short-term investments, existing Facility Agreements, and anticipated cash flows from operations will be sufficient to meet our liquidity and capital requirements, notwithstanding the COVID-19 pandemic, for at least the next twelve months from the date of filing. However, as this is a highly dynamic situation, and it is still developing rapidly, including new strains as it relates to the effectiveness and utilization rates of vaccines for COVID-19 and its variants, there is uncertainty surrounding our business, and our near- and long-term liquidity, financial condition and operating results could deteriorate. For other information, please see our Annual Report. 32 -------------------------------------------------------------------------------- Table of Contents RESULTS OF OPERATIONS The following tables reflect our income from operations for the three and nine months endedJuly 3, 2021 andJune 27, 2020 : Three months ended
(amounts in thousands of dollars)
$ Change % Change Net revenue$ 424,318 $ 150,450 $ 273,868 182.0 % Cost of sales 228,623 81,027 147,596 182.2 % Gross profit 195,695 69,423 126,272 181.9 % Selling, general and administrative 39,103 27,905 11,198 40.1 % Research and development 36,137 30,547 5,590 18.3 % Operating expenses 75,240 58,452 16,788 28.7 % Income from operations$ 120,455 $ 10,971 $ 109,484 997.9 % Nine months ended (dollar amounts in thousands) July 3, 2021 June 27, 2020 $ Change % Change Net revenue$ 1,032,338 $ 445,488 $ 586,850 131.7 % Cost of sales 566,667 236,398 330,269 139.7 % Gross profit 465,671 209,090 256,581 122.7 % Selling, general and administrative 105,511 85,723 19,788 23.1 % Research and development 102,549 87,906 14,643 16.7 % Operating expenses 208,060 173,629 34,431 19.8 % Income from operations$ 257,611 $ 35,461 $ 222,150 626.5 % Net Revenue Our net revenue for the three and nine months endedJuly 3, 2021 increased as compared to our net revenue for the three and nine months endedJune 27, 2020 . The increase in net revenue is primarily due to higher volume in both Capital Equipment and APS. The following tables reflect net revenue by reportable segments for the three and nine months endedJuly 3, 2021 andJune 27, 2020 : Three months ended (dollar amounts in thousands) July 3, 2021 June 27, 2020 $ Change % Change % of total net % of total net Net Revenue revenue Net Revenue revenue Capital Equipment$ 370,187 87.2 %$ 111,436 74.1 %$ 258,751 232.2 % APS 54,131 12.8 % 39,014 25.9 % 15,117 38.7 % Total net revenue$ 424,318 100.0 %$ 150,450 100.0 %$ 273,868 182.0 % Nine months ended (dollar amounts in thousands) July 3, 2021 June 27, 2020 $ Change % Change % of total net % of total net Net Revenue revenue Net Revenue revenue Capital Equipment$ 881,722 85.4 %$ 326,982 73.4 %$ 554,740 169.7 % APS 150,616 14.6 % 118,506 26.6 % 32,110 27.1 % Total net revenue$ 1,032,338 100.0 %$ 445,488 100.0 %$ 586,850 131.7 % 33
-------------------------------------------------------------------------------- Table of Contents Capital Equipment For the three months endedJuly 3, 2021 , the higher Capital Equipment net revenue as compared to the prior year period was primarily driven by growing demand in the general semiconductor end market for consumer applications and 5G transition, and automotive end market. This was partially offset by unfavorable price variance due to less favorable customer mix. For the nine months endedJuly 3, 2021 , the higher Capital Equipment net revenue as compared to the prior year period was primarily driven by growing demand in the general semiconductor end market for consumer applications and 5G transition, automotive end market and in the LED end market for both the adoption of the advanced LED display and sequential improvements for general lighting LED. This was partially offset by unfavorable price variance due to less favorable customer mix. APS For the three and nine months endedJuly 3, 2021 , the higher APS net revenue as compared to the prior year period was primarily due to higher volume in spares, services and wire bonding tools. Gross Profit Margin The following tables reflect gross profit margin as a percentage of net revenue by reportable segments for the three and nine months endedJuly 3, 2021 andJune 27, 2020 : Three months ended Basis Point July 3, 2021 June 27, 2020 Change Capital Equipment 44.6 % 41.8 % 280 APS 56.3 % 58.6 % (230) Total gross profit margin 46.1 % 46.1 % - Nine months ended Basis Point July 3, 2021 June 27, 2020 Change Capital Equipment 42.9 % 43.4 % (50) APS 57.9 % 56.6 % 130 Total gross profit margin 45.1 % 46.9 % (180) Capital Equipment For the three months endedJuly 3, 2021 , the higher Capital Equipment gross profit margin as compared to the prior year period was primarily driven by favorable product mix. For the nine months endedJuly 3, 2021 , the Capital Equipment gross profit margin was generally consistent with the prior year period. APS For the three months endedJuly 3, 2021 , the lower APS gross profit margin as compared to the prior year period was primarily driven by less favorable product mix in spares and services. For the nine months endedJuly 3, 2021 , the higher APS gross profit margin as compared to the prior year period was primarily driven by favorable product mix in spares and services. Income from Operations For the three and nine months endedJuly 3, 2021 , the higher income from operations as compared to the prior year period was primarily due to higher contribution from Capital Equipment and APS. The following tables reflect income from operations by reportable segments for the three and nine months endedJuly 3, 2021 andJune 27, 2020 : 34
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Three months ended (dollar amounts in thousands) July 3, 2021 June 27, 2020 $ Change % Change Capital Equipment$ 107,016 $ 1,045 $ 105,971 10,140.8 % APS 13,439 9,926 3,513 35.4 %
Total of exploitation products
Nine months ended
(dollar amounts in thousands) July 3, 2021 June 27, 2020 $ Change % Change
Capital Equipment $ 218,010 $ 7,815 $ 210,195 2,689.6 %
APS 39,601 27,646
11,955 43.2% Total operating income
Capital Equipment For the three and nine months endedJuly 3, 2021 , the higher Capital Equipment income from operations as compared to the prior year period was primarily due to higher demand as explained under 'Net Revenue' above. This was partially offset by higher operating expenses as explained under 'Operating Expenses' below. APS For the three and nine months endedJuly 3, 2021 , the higher APS income from operations as compared to the prior year period was primarily due to higher demand as explained under 'Net Revenue' above. This was partially offset by higher operating expenses as explained under 'Operating Expenses' below. Operating Expenses The following tables reflect operating expenses for the three and nine months endedJuly 3, 2021 andJune 27, 2020 : Three months ended
(amounts in thousands of dollars)
$ Variation% Variation
Sales, general and administrative
$ 11,198 40.1 % Research & development 36,137 30,547 5,590 18.3 % Total$ 75,240 $ 58,452 $ 16,788 28.7 % Nine months ended (dollar amounts in thousands) July 3, 2021 June 27, 2020 $ Change % Change Selling, general & administrative$ 105,511 $ 85,723 $ 19,788 23.1 % Research & development 102,549 87,906 14,643 16.7 % Total$ 208,060 $ 173,629 $ 34,431 19.8 % Selling, General and Administrative ("SG&A") For the three months endedJuly 3, 2021 , the higher SG&A expenses as compared to the prior year period were primarily due to$7.4 million higher staff costs related to an increase in incentive compensation and headcount,$0.7 million higher professional services expenses and a$3.2 million lower COVID-19 related grant and wage related subsidy received from theSingapore government. For the nine months endedJuly 3, 2021 , the higher SG&A expenses as compared to the prior year period were primarily due to$14.6 million higher staff costs related to an increase in incentive compensation and headcount, and$4.9 million higher professional services expenses. Research and Development ("R&D") For the three months endedJuly 3, 2021 , the higher R&D expenses as compared to the prior year period were primarily due to higher staff costs related to an increase in incentive compensation and headcount. 35 -------------------------------------------------------------------------------- Table of Contents For the nine months endedJuly 3, 2021 , the higher R&D expenses as compared to the prior year period were primarily due to higher staff costs related to an increase in incentive compensation and headcount, and higher spending in development of prototypes. Interest Income and Expense The following tables reflect interest income and interest expense for the three and nine months endedJuly 3, 2021 andJune 27, 2020 : Three months ended (dollar amounts in thousands) July 3, 2021 June 27, 2020 $ Change % Change Interest income$ 564 $ 1,374 $ (810) (59.0) % Interest expense$ (41) $ (446)$ 405 (90.8) % Nine months ended (dollar amounts in thousands) July 3, 2021 June 27, 2020 $ Change % Change Interest income$ 1,801 $ 6,888 $ (5,087) (73.9) % Interest expense$ (146) $ (1,690) $ 1,544 (91.4) % Interest income For the three and nine months endedJuly 3, 2021 , the lower interest income as compared to the prior year period was primarily due to lower weighted average interest rate on cash, cash equivalents and short-term investments. Interest expense For the three and nine months endedJuly 3, 2021 , the lower interest expense as compared to the prior year period was primarily due to lower average short-term debt. Please refer to Note 10 of Item 1 for discussion on the Overdraft Facility. Provision for Income Taxes The following table reflects the provision for income taxes and the effective tax rate for the three and nine months endedJuly 3, 2021 andJune 27, 2020 : Three months ended Nine months ended
(amounts in thousands of dollars)
Change July 3, 2021 June 27, 2020 Change Provision for income taxes$ 7,212 $ 690 $ 6,522 $ 25,722 $ 3,985 $ 21,737 Effective tax rate 6.0 % 5.8 % 0.2 % 9.9 % 9.8 % 0.1 % Please refer to Note 14 of Item 1 for discussion on the provision for income taxes and the effective tax rate for the three and nine months endedJuly 3, 2021 as compared to the prior year period.
CASH AND CAPITAL RESOURCES The following table presents the total of cash, cash equivalents and short-term investments at the
As of (dollar amounts in thousands) July 3, 2021 October 3, 2020 $ Change Cash and cash equivalents $ 387,999 $ 188,127$ 199,872 Short-term investments 247,000 342,000 (95,000) Total cash, cash equivalents, and short-term investments $ 634,999 $ 530,127$ 104,872 Percentage of total assets 45.0% 50.3% The following table reflects a summary of the Consolidated Condensed Statements of Cash Flow information for the nine months endedJuly 3, 2021 andJune 27, 2020 : 36
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Nine months ended (in thousands) July 3, 2021 June 27, 2020 Net cash provided by operating activities$ 176,656 $ 62,681 Net cash provided by investing activities 54,221 25,863 Net cash used in financing activities (31,982) (130,618) Effect of exchange rate changes on cash and cash equivalents 977 (335) Changes in cash and cash equivalents$ 199,872 $ (42,409) Cash and cash equivalents, beginning of period 188,127 364,184 Cash and cash equivalents, end of period$ 387,999 $ 321,775 Nine months endedJuly 3, 2021 Net cash provided by operating activities was primarily due to net income of$233.5 million , non-cash adjustments to net income of$14.3 million and a net unfavorable change in operating assets and liabilities of$71.1 million . The net change in operating assets and liabilities was primarily driven by an increase in accounts and other receivable of$170.4 million , an increase in inventory of$40.8 million , and an increase in prepaid expenses and other current assets of$2.9 million . This was partially offset by an increase in accounts payable, accrued expenses and other current liabilities of$144.7 million . The increase in accounts and other receivable was due to increase in sales in the first three quarters of fiscal 2021. The increase in inventory was due to higher manufacturing activities during the third quarter of fiscal 2021 as compared to the fourth quarter of fiscal 2020 in anticipation of higher demand in subsequent periods. The higher accounts payable, accrued expenses and other current liabilities was primarily due to higher purchases, accruals on incentive compensation and other bonuses, and customer credits in the third quarter of fiscal 2021. Net cash provided by investing activities was due to net redemption of short-term investments of$95.0 million and proceeds from sale of an equity-method investment of$2.1 million . This was partially offset by the cash outflow for the Uniqarta acquisition of$26.3 million and capital expenditures of$16.7 million . Net cash used in financing activities was primarily due to common stock repurchases of$7.0 million and dividend payments of$24.8 million . Nine months endedJune 27, 2020 Net cash provided by operating activities was primarily due to net income of$36.5 million and non-cash adjustments to net income of$31.8 million and partially offset by a net unfavorable change in operating assets and liabilities of$5.7 million . The decrease in net change in operating assets and liabilities was primarily driven by an increase in inventory of$28.0 million , and a decrease in income tax payable of$5.4 million . This was partially offset by an increase in accounts payable, accrued expenses and other current liabilities of$25.9 million , and a decrease in prepaid expenses and other current assets of$1.7 million . The increase in inventory was due to higher manufacturing activities during the third quarter of fiscal 2020 as compared to the fourth quarter of fiscal 2019 in anticipation of higher demand in subsequent periods. The decrease in income tax payable was mainly due to payment. The higher accounts payable, accrued expenses and other current liabilities was primarily due to higher purchases, and higher accruals on incentive compensation and other bonuses in the third quarter of fiscal 2020. Net cash provided by investing activities was due to net redemption of short-term investments of$35.0 million to repay the short-term debt. This was partially offset by capital expenditures of$7.8 million and an equity investment of$1.3 million . Net cash used by financing activities was primarily due to net repayment of short-term debt of$60.9 million , common stock repurchases of$46.9 million and dividend payments of$22.8 million . Fiscal 2021 Liquidity and Capital Resource Outlook We expect our aggregate fiscal 2021 capital expenditures to be between approximately$26.0 million and$30.0 million , of which approximately$15.3 million has been made through the third quarter. Expenditures are anticipated to be primarily used for R&D projects, enhancements to our manufacturing operations, improvements to our information technology security, the continuing implementation of an enterprise resource planning system and leasehold improvements for our facilities. Our ability to make these expenditures will depend, in part, on our future cash flows, which are determined by our future operating 37 -------------------------------------------------------------------------------- Table of Contents performance and, therefore, subject to prevailing global macroeconomic conditions, including the impact from the COVID-19 pandemic, as well as financial, business and other factors, some of which are beyond our control. As ofJuly 3, 2021 andOctober 3, 2020 , approximately$614.8 million and$492.0 million of cash, cash equivalents, and short-term investments were held by the Company's foreign subsidiaries, respectively, with a portion of the cash amounts expected to be available for use in theU.S. without incurring additionalU.S. income tax. The Company's international operations and capital requirements are anticipated to be funded primarily by cash generated by foreign operating activities and cash held by foreign subsidiaries. Most of the Company's operations and liquidity needs are outside theU.S. The Company's U.S. operations and capital requirements are anticipated to be funded primarily by cash generated fromU.S. operating activities, and by our existing Facility Agreements. In the future, the Company may repatriate additional cash held by foreign subsidiaries that has already been subject toU.S. income taxes. We believe these sources of cash and liquidity are sufficient to meet our business needs in theU.S. for the foreseeable future including funding ofU.S. operations, capital expenditures, repayment of outstanding balances under the Facility Agreements, the dividend program, and the share repurchase program as approved by the Board of Directors. We believe that our existing cash, cash equivalents, short-term investments, existing Facility Agreements, and anticipated cash flows from operations will be sufficient to meet our liquidity and capital requirements, notwithstanding the COVID-19 pandemic, for at least the next twelve months from the date of filing. Our liquidity is affected by many factors, some based on normal operations of our business and others related to global economic conditions and industry uncertainties, which we cannot predict. We also cannot predict economic conditions or industry downturns or the timing, strength or duration of recoveries. We intend to continue to use our cash for working capital needs and for general corporate purposes. In this unprecedented environment, as a result of the COVID-19 pandemic or for other reasons, we may seek, as we believe appropriate, additional debt or equity financing that would provide capital for general corporate purposes, working capital funding, additional liquidity needs or to fund future growth opportunities, including possible acquisitions. The timing and amount of potential capital requirements cannot be determined at this time and will depend on a number of factors, including the actual and projected demand for our products, semiconductor and semiconductor capital equipment industry conditions, competitive factors, and the condition of financial markets. Share Repurchase Program OnAugust 15, 2017 , the Company's Board of Directors authorized a program (the "Program") to repurchase up to$100 million in total of the Company's common stock on or beforeAugust 1, 2020 . In 2018 and 2019, the Board of Directors increased the share repurchase authorization under the Program to$200 million and$300 million , respectively. OnJuly 3, 2020 , the Board of Directors increased the share repurchase authorization under the Company's existing share repurchase program by an additional$100 million to$400 million , and extended its duration throughAugust 1, 2022 . The Company has entered into a written trading plan under Rule 10b5-1 of the Exchange Act to facilitate repurchases under the Program. The Program may be suspended or discontinued at any time and is funded using the Company's available cash, cash equivalents and short-term investments. Under the Program, shares may be repurchased through open market and/or privately negotiated transactions at prices deemed appropriate by management. The timing and amount of repurchase transactions under the Program depend on market conditions as well as corporate and regulatory considerations. During the three and nine months endedJuly 3, 2021 , the Company repurchased a total of approximately 82.0 thousand and 153.0 thousand shares of common stock under the Program at a cost of approximately$4.1 million and$6.4 million , respectively. As ofJuly 3, 2021 , our remaining stock repurchase authorization under the Program was approximately$135.7 million . Dividends OnMay 28, 2021 ,March 5, 2021 , andDecember 10, 2020 , the Board of Directors declared a quarterly dividend of$0.14 per share of common stock. Dividends paid during the three and nine months endedJuly 3, 2021 totaled$8.7 million and$24.8 million , respectively. The declaration of any future cash dividend is at the discretion of the Board of Directors and will depend on the Company's financial condition, results of operations, capital requirements, business conditions and other factors, as well as a determination that such dividends are in the best interests of the Company's shareholders. Other Obligations and Contingent Payments In accordance with GAAP, certain obligations and commitments are not required to be included in the Consolidated Condensed Balance Sheets and Statements of Operations. These obligations and commitments, while entered into in the normal course of business, may have a material impact on our liquidity and are disclosed in the table below. 38
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Table of Contents As ofJuly 3, 2021 , the Company had deferred tax liabilities of$32.9 million and unrecognized tax benefits within the income taxes payable for uncertain tax positions of$12.5 million , inclusive of accrued interest on uncertain tax positions of$1.6 million , substantially all of which would affect our effective tax rate in the future, if recognized. It is reasonably possible that the amount of the unrecognized tax benefit with respect to certain unrecognized tax positions will increase or decrease during the next 12 months due to the expected lapse of statutes of limitation and / or settlements of tax examinations. Given the number of years and numerous matters that remain subject to examination in various tax jurisdictions, we cannot practicably estimate the timing or financial outcomes of these examinations and, therefore, these amounts are excluded from the amounts below. When estimating its tax positions, the Company considers and evaluates numerous complex areas of taxation, which may require periodic adjustments and which may not reflect the final tax liabilities. The following table presents certain payments due by the Company under contractual and statutory obligations with minimum firm commitments as ofJuly 3, 2021 :
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