United States securities and exchange commission logo
March 12, 2021
Dean Bulter
Chief Financial Officer
Synaptics Inc
1251 McKay Drive
San Jose, CA 95131
Re: Synaptics Inc
Form 10-K for the
Fiscal Year Ended June 27, 2020
Response dated
February 23, 2021
File No. 000-49602
Dear Mr. Bulter:
We have reviewed your February 23, 2021 response to our comment
letter and have the
following comments. In some of our comments, we may ask you to provide
us with information
so we may better understand your disclosure.
Please respond to these comments within ten business days by
providing the requested
information or advise us as soon as possible when you will respond. If
you do not believe our
comments apply to your facts and circumstances, please tell us why in
your response.
After reviewing your response to these comments, we may have
additional
comments. Unless we note otherwise, our references to prior comments are
to comments in our
February 2, 2021 letter.
Form 10-K for the Fiscal Year Ended June 27, 2020
Notes to Consolidated Financial Statements
4. Divestiture, page F-17
1. We have read your
response to comment 2, noting that you determined the TDDI product
line disposal did not
qualify as a discontinued operation since it did not qualify as a
component of an entity
and did not represent a strategic shift that has or will have a major
effect on your
operations and financial results. Please address the following comments:
Explain in
further detail how you determined the disposed TDDI product line did not
represent a
component of an entity. Considering you previously provided pro forma
financial
statements reflecting the impact, it appears that the operations and cash
flows could be
clearly distinguished, operationally and for financial reporting
Dean Bulter
FirstName LastNameDean Bulter
Synaptics Inc
Comapany
March NameSynaptics Inc
12, 2021
March2 12, 2021 Page 2
Page
FirstName LastName
purposes, from the rest of your business. We also note that you
refer to the disposed
entity as a "business" within the aforementioned Form 8-K, on
page 40 of your Form
10-K, and on page 31 of your Form 10-Q for the quarterly period
ended December
26, 2020.
Explain in further detail how you determined that the disposal
did not represent a
strategic shift that has or will have a major effect on your
operations and financial
results. Based on your pro forma financial statements, we note
that the disposal
represented approximately 22% your fiscal 2019 revenues and over
half of your net
income for the six month interim period ended December 28, 2019.
We further note
on page 31 of your most recent Form 10-Q that there was a 49% and
39.2% decline
in your mobile product application net revenues for the three and
six months ended
December 26, 2020, respectively, that you primarily attribute to
the sale of your
TDDI business.
12. Segment, Customers, and Geographic Information, page F-33
2. You indicate in your response to comment 3 that the CODM has ultimate
decision-making
authority over the key operating decisions across all product
categories, as well as other
areas in the organization. Please describe the key operating
decisions, who makes these
decisions, and how performance is assessed and how resources are
allocated.
Additionally, tell us what financial information is used by the CODM
in making these key
operating decisions. As part of your response, please provide
examples.
3. We note the reference to your annual operating and long-range planning
processes. Please
explain to us how budgets are prepared, who approves the budget at
each step of the
process, the level of detail discussed and individuals that
participate at each step, and the
level at which the CODM makes changes to the budget. Also, explain
your process to
assess performance against budget, including the level at which this
assessment is made,
the frequency, and the individuals involved in that process. In this
regard, we note from
your response that you prepare internal quarterly financial reports on
a divisional basis.
4. We note from page 5 of your response that the CODM meets with his
direct reports one-
on-one at least monthly and meets with the division general managers
and their respective
divisional leadership teams on a monthly basis. Please tell us whether
any financial
information is prepared, reviewed or discussed in conjunction with
these meetings, either
formally or informally. If so, describe the financial information and
how it is used.
5. We note from your response that the roles and responsibilities of
division general
managers include approving tactical decisions aligning to corporate
strategy, resource
allocations and management of those resources within the division.
Please explain to us
the nature of the resource allocations that the division general
managers are responsible
for and contrast them with resource allocations performed by the CODM.
6. We note from your response that 50% of the short-term compensation for
division general
Dean Bulter
Synaptics Inc
March 12, 2021
Page 3
managers is based on achievement of target financial metrics at the
level of their
respective divisions. Please tell us what these financial metrics are
and each of their
relative weightings in the compensation package.
You may contact Jean Yu at 202-551-3305 or Andrew Blume at 202-551-3254
if you
have questions regarding comments on the financial statements and related
matters. Please
contact Sherry Haywood at 202-551-3345 or Jay Ingram at 202-551-3397 with any
other
questions.
FirstName LastNameDean Bulter Sincerely,
Comapany NameSynaptics Inc
Division of
Corporation Finance
March 12, 2021 Page 3 Office of
Manufacturing
FirstName LastName
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This website contains forward-looking statements that are subject to the safe harbors created under the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended. Forward-looking statements give our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business, and can be identified by the fact that they do not relate strictly to historical or current facts. Such forward-looking statements may include words such as "expect," "anticipate," "intend," "believe," "estimate," "plan," "target," "strategy," "continue," "may," "will," "should," variations of such words, or other words and terms of similar meaning. All forward-looking statements reflect our best judgment and are based on several factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control. Such factors include, but are not limited to, the risks as identified in the "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Business" sections of our Annual Report on Form 10-K for our most recent fiscal year, and other risks as identified from time to time in our Securities and Exchange Commission reports. Forward-looking statements are based on information available to us on the date hereof, and we do not have, and expressly disclaim, any obligation to publicly release any updates or any changes in our expectations, or any change in events, conditions, or circumstances on which any forward-looking statement is based. Our actual results and the timing of certain events could differ materially from the forward-looking statements. These forward-looking statements do not reflect the potential impact of any mergers, acquisitions, or other business combinations that had not been completed as of the date of this filing.