Alpha and Omega Semiconductor Limited (“AOS”) (NASDAQ: AOSL),
today reported financial results for the fiscal fourth quarter and
the fiscal year ended June 30, 2022.
The results for the fiscal fourth quarter ended June 30, 2022
were as follows:
GAAP Financial
Comparison
Quarterly
(in millions, except percentage
and per share data)
(unaudited)
Three Months Ended
June 30, 2022
March 31, 2022
June 30, 2021
Revenue
$
194.0
$
203.2
$
177.3
Gross Margin
32.6
%
35.6
%
34.2
%
Operating Income
$
18.1
$
31.2
$
22.4
Net Income Attributable to AOS
$
15.1
$
31.7
$
19.5
Net Income Per Share Attributable to AOS -
Diluted
$
0.53
$
1.11
$
0.71
Non-GAAP Financial
Comparison
Quarterly
(in millions, except percentage
and per share data)
(unaudited)
Three Months Ended
June 30, 2022
March 31, 2022
June 30, 2021
Revenue
$
194.0
$
203.2
$
177.3
Non-GAAP Gross Margin
33.8
%
36.7
%
34.9
%
Non-GAAP Operating Income
$
28.9
$
40.5
$
29.1
Non-GAAP Net Income Attributable to
AOS
$
27.1
$
38.2
$
26.3
Non-GAAP Net Income Per Share Attributable
to AOS - Diluted
$
0.95
$
1.34
$
0.95
The non-GAAP financial measures in the schedule above and under
the section "Financial Result for Fiscal Q4 Ended June 30, 2022"
below exclude the effect of share-based compensation expenses,
amortization of purchased intangible, legal costs related to
government investigation and income tax effect of non-GAAP
adjustments in each of the periods presented, and equity method
investment loss from equity investee for the three months ended
June 30, 2022 and March 31, 2022, as well as gain on
deconsolidation and changes of equity interest in the JV Company
for the three months ended March 31, 2022. A detailed
reconciliation of GAAP and non-GAAP financial measures is included
at the end of this press release.
The results for the fiscal year ended June 30, 2022 and 2021
were as follows:
GAAP Financial
Comparison
Annually
(in millions, except percentage
and per share data)
(unaudited)
Year Ended June 30,
2022
2021
Revenue
$
777.6
$
656.9
Gross Margin
34.5
%
31.1
%
Operating Income
$
102.0
$
64.1
Net Income Attributable to AOS
$
453.2
$
58.1
Net Income Per Share attributable to AOS -
Diluted
$
16.07
$
2.13
Non-GAAP Financial
Comparison
Annually
(in millions, except percentage
and per share data)
(unaudited)
Year Ended June 30,
2022
2021
Revenue
$
777.6
$
656.9
Non-GAAP Gross Margin
35.6
%
31.9
%
Non-GAAP Operating Income
$
137.6
$
86.0
Non-GAAP Net Income Attributable to
AOS
$
128.6
$
79.9
Non-GAAP Net Income Per Share Attributable
to AOS - Diluted
$
4.56
$
2.93
The non-GAAP financial measures in the schedule above exclude
the effect of share-based compensation expenses, amortization of
purchased intangible, legal costs related to government
investigation and income tax effect of non-GAAP adjustments for
fiscal years ended June 30, 2022 and 2021, and equity method
investment loss from equity investee and gain on deconsolidation
and changes of equity interest in the JV Company for the fiscal
year ended June 30, 2022, as well as production ramp up costs
related to joint venture for fiscal year ended June 30, 2021. A
detailed reconciliation of GAAP and non-GAAP financial measures is
included at the end of this press release.
Financial Results for Fiscal Q4 Ended June 30, 2022
- Revenue was $194.0 million, an increase of 9.4% from the same
quarter last year and a decrease of 4.6% quarter-over-quarter.
- GAAP gross margin was 32.6%, down from 34.2% year-over-year and
35.6% in the prior quarter.
- Non-GAAP gross margin was 33.8%, down from 34.9% from the same
quarter last year and down from 36.7% in the prior quarter.
- GAAP operating expenses were $45.1 million, up from $41.2
million in the prior quarter and up from $38.2 million from the
same quarter last year.
- Non-GAAP operating expenses were $36.7 million, an increase of
$2.7 million from last quarter and an increase of $3.9 million from
the same quarter last year.
- GAAP operating income was $18.1 million, as compared to $31.2
million in the prior quarter and $22.4 million from the same
quarter last year.
- Non-GAAP operating income was $28.9 million as compared to
$40.5 million for the prior quarter and $29.1 million for the same
quarter last year.
- GAAP net income per share attributable to AOS was $0.53,
compared to $0.71 earnings per share for the same quarter last year
and $1.11 for the prior quarter.
- Non-GAAP earnings per share attributable to AOS was $0.95,
compared to $0.95 for the same quarter last year and $1.34 for the
prior quarter.
- Consolidated cash flow provided by operating activities was
$25.7 million, which included $3.4 million of net customer
deposits, as compared to $61.8 million in prior quarter, which
included $6.4 million of net customer deposits.
- The Company closed the quarter with $314.4 million of cash and
cash equivalents.
AOS Chairman and Chief Executive Officer Dr. Mike Chang
commented, "Our fiscal Q4 was another strong quarter despite the
challenge posed by the COVID lockdown in Shanghai. Once again, we
outperformed our guidance midpoint. Revenue was $194 million, an
increase of 9% year-over-year. Non-GAAP gross margin was 33.8% and
non-GAAP EPS was $0.95. As a reminder, our ability to assemble and
ship products was severely limited for most of April due to the
city-wide lockdown in Shanghai. Once cleared to restart operations
at the end of April, it also took time for our assembly lines to
return to full utilization. Our Shanghai facilities are mostly back
to normal and are currently operating at full capacity. I want to
express my deepest appreciation to our employees once again for
their immense sacrifice and unwavering dedication to AOS during
these challenging times. We are grateful to have their loyalty and
support.”
Dr. Chang continued, "Looking ahead, we are seeing inventory
corrections happening in certain consumer end markets. While we are
not immune to current global market conditions, as of today, our
demand and backlog are still higher than our overall capacity. I
believe our strategic position within our sector is resilient
thanks to our technology leadership, diversified product portfolio,
and strong Tier 1 customer base in all our business segments. In
fact, our market share at Tier 1 customers is the highest that it
has ever been. The electrification of everything is just getting
started, and our power products sit at the forefront of this trend.
We are on pace and focused to achieve our one billion dollar annual
revenue target in the next couple of years.”
Business Outlook for Fiscal Q1 Ending September 30,
2022
The following statements are based on management's current
expectations. These statements are forward-looking, and actual
results may differ materially. AOS undertakes no obligation to
update these statements.
- Revenue is expected to be $210 million plus or minus $3
million.
- Gross margin is expected to be 33.8% plus or minus 1%. Non-GAAP
gross margin is expected to be 35.0% plus or minus 1%. Note that
non-GAAP gross margin excludes $1.8 million of estimated
share-based compensation charges and $0.8 million of amortization
of purchased intangible assets.
- GAAP operating expenses are expected to be in the range of
$45.7 million, plus or minus $1 million. Non-GAAP operating
expenses are expected to be in the range of $36.5 million plus or
minus $1 million. Non-GAAP operating expenses exclude $9.0 million
of estimated share-based compensation charges and $0.2 million of
estimated legal expenses related to the government
investigation.
- Interest expense is expected to be $1.2 million, and
- Tax expense is expected to be $1.2 million to $1.4
million.
Conference Call and Webcast
AOS plans to hold an investor teleconference and live webcast to
discuss the financial results for the fiscal fourth quarter and the
fiscal year ended June 30, 2022 today, August 10, 2022 at 2:00 p.m.
PT / 5:00 p.m. ET. To listen to the live conference call, please
dial +1 (844) 200-6205 or +1 (929) 526-1599 if dialing from outside
the United States and Canada. The access code is 577380. A live
webcast of the call will also be available in the "Events &
Presentations" section of the company's investor relations website,
http://investor.aosmd.com. The webcast replay will be available for
seven days after the live call on the same website. In addition, a
copy of the script of management's prepared remarks and a live
webcast of the call will also be available in the "Events &
Presentations" section of the company's investor relations website,
http://investor.aosmd.com.
Forward Looking Statements
This press release contains forward-looking statements that are
based on current expectations, estimates, forecasts and projections
of future performance based on management's judgment, beliefs,
current trends, and anticipated product performance. These
forward-looking statements include, without limitation, statements
relating to macroeconomic conditions, resumption of production at
our Shanghai facilities and continuing impact of COVID-19 pandemic,
anticipated earnings power and non-GAAP EPS on an annual basis, our
growth opportunities and new markets, our annual revenue target,
projected amount of revenue, gross margin, operating income, income
tax expenses, net income, and share-based compensation expenses,
non-GAAP gross margin, non-GAAP operating expenses, tax expenses,
our objectives to achieve revenue target, our ability to gain new
customers and design wins, strategic partnership with customers,
and other information under the section entitled “Business Outlook
for Fiscal Q1 Ending September 30, 2022”. Forward-looking
statements involve risks and uncertainties that may cause actual
results to differ materially from those contained in the
forward-looking statements. These factors include, but are not
limited to, the impact of COVID-19 pandemic on our business and the
city-wide lockdown in Shanghai; deconsolidation of CQJV; our lack
of control over the joint venture in China; difficulties and
challenges in executing our diversification strategy into different
market segments; new tariffs on goods from China; ordering pattern
from distributors and seasonality; changes in regulatory
environment and government investigation; our ability to introduce
or develop new and enhanced products that achieve market
acceptance; decline of PC markets; the actual product performance
in volume production; the quality and reliability of our product,
our ability to achieve design wins; the general business and
economic conditions; the state of semiconductor industry and
seasonality of our markets; our ability to maintain factory
utilization at a desirable level; and other risks as described in
our SEC filings, including our Annual Report on Form 10-K for the
fiscal year ended June 30, 2022 to be filed by AOS with the SEC and
other periodic reports we filed with the SEC. Other unknown or
unpredictable factors or underlying assumptions subsequently
proving to be incorrect could cause actual results to differ
materially from those in the forward-looking statements. Although
we believe that the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results,
level of activity, performance, or achievements. You should not
place undue reliance on these forward-looking statements. All
information provided in this press release is as of today's date,
unless otherwise stated, and AOS undertakes no duty to update such
information, except as required under applicable law. The fiscal
2022 financial information reported in this press release is
subject to the completion of our annual report which will be
reported in our forthcoming Form 10-K to be filed with the SEC.
Use of Non-GAAP Financial Measures
To supplement our unaudited consolidated financial statements
presented on a basis consistent with U.S. GAAP, we disclose certain
non-GAAP financial measures for our historical performance,
including non-GAAP gross profit, gross margin, operating income,
net income attributable to AOS, net income, diluted earnings per
share ("EPS") and EBITDAS. These supplemental measures exclude,
among other items, share-based compensation expenses, legal costs
related to government investigation, amortization of purchased
intangible, production ramp up costs related to the JV Company,
income tax effect of non-GAAP adjustments, equity method investment
loss from equity investee, and gain on deconsolidation and changes
of equity interest in the JV Company. We also disclose certain
non-GAAP financial measures in our guidance for the next quarter,
including non-GAAP gross margin, operating expenses and
earnings/loss in equity method investment. We believe that these
historical and forecast non-GAAP financial measures provide useful
information to both management and investors by excluding certain
items and expenses that are not indicative of our core operating
results or do not reflect our normal business operations. In
addition, our management uses non-GAAP measures to compare our
performance relative to forecasts and to benchmark our performance
externally against competitors. Our use of non-GAAP financial
measures has certain limitations in that such non-GAAP financial
measures may not be directly comparable to those reported by other
companies. For example, the terms used in this press release, such
as non-GAAP net income (loss) or non-GAAP operating expenses, do
not have a standardized meaning. Other companies may use the same
or similarly named measures, but exclude different items, which may
not provide investors with a comparable view of our performance in
relation to other companies. In addition, we included the income
tax effect of non-GAAP adjustments in the non-GAAP net income of
reconciliation table for all periods presented as the management
believes that such non-GAAP presentation provides useful
information to investors, even though the amounts are not
significant. We seek to compensate for the limitation of our
non-GAAP presentation by having provided a detailed reconciliation
of the non-GAAP financial measures to the most directly comparable
U.S. GAAP measures both in the text in this press release and in
the tables attached hereto. Investors are encouraged to review the
related U.S. GAAP financial measures and the reconciliation of
these non-GAAP financial measures to their most directly comparable
U.S. GAAP financial measures.
About Alpha and Omega Semiconductor
Alpha and Omega Semiconductor Limited, or AOS, is a designer,
developer and global supplier of a broad range of power
semiconductors, including a wide portfolio of Power MOSFET, IGBT,
IPM, TVS, HVIC, GaN/SiC, Power IC and Digital Power products. AOS
has developed extensive intellectual property and technical
knowledge that encompasses the latest advancements in the power
semiconductor industry, which enables us to introduce innovative
products to address the increasingly complex power requirements of
advanced electronics. AOS differentiates itself by integrating its
Discrete and IC semiconductor process technology, product design,
and advanced packaging know-how to develop high performance power
management solutions. AOS’ portfolio of products targets
high-volume applications, including personal and portable
computers, graphic cards, flat panel TVs, home appliances, power
tools, smart phones, battery packs, quick chargers, home
appliances, consumer and industrial motor controls and power
supplies for TVs, computers, servers and telecommunications
equipment. For more information, please visit www.aosmd.com.
The following unaudited consolidated financial statements are
prepared in accordance with U.S. GAAP.
Alpha and Omega Semiconductor
Limited
Condensed Consolidated
Statements of Operations
(in thousands, except
percentages and per share amounts)
(unaudited)
Three Months Ended
Fiscal Year Ended
June 30, 2022
March 31, 2022
June 30, 2021
June 30, 2022
June 30, 2021
Revenue
$
193,959
$
203,239
$
177,309
$
777,552
$
656,902
Cost of goods sold
130,737
130,837
116,729
508,996
452,359
Gross profit
63,222
72,402
60,580
268,556
204,543
Gross margin
32.6
%
35.6
%
34.2
%
34.5
%
31.1
%
Operating expenses:
Research and development
20,386
16,545
17,282
71,259
62,953
Selling, general and administrative
24,696
24,625
20,935
95,259
77,514
Total operating expenses
45,082
41,170
38,217
166,518
140,467
Operating income
18,140
31,232
22,363
102,038
64,076
Other income, net
279
263
369
999
2,456
Interest expense, net
(895
)
(308
)
(1,476
)
(3,920
)
(6,308
)
Gain on deconsolidation of the JV
Company
—
—
—
399,093
—
Gain (loss) on changes of equity interest
in the JV Company, net
—
4,501
—
(3,140
)
—
Net income before income taxes
17,524
35,688
21,256
495,070
60,224
Income tax expense
940
2,902
1,241
39,258
3,935
Net income before loss from equity method
investment
16,584
32,786
20,015
455,812
56,289
Equity method investment loss from equity
investee
1,493
1,136
—
2,629
—
Net income
15,091
31,650
20,015
453,183
56,289
Net income (loss) attributable to
noncontrolling interest
—
—
476
20
(1,827
)
Net income attributable to Alpha and Omega
Semiconductor Limited
$
15,091
$
31,650
$
19,539
$
453,163
$
58,116
Net income per common share attributable
to Alpha and Omega Semiconductor Limited
Basic
$
0.55
$
1.18
$
0.74
$
16.93
$
2.25
Diluted
$
0.53
$
1.11
$
0.71
$
16.07
$
2.13
Weighted average number of common share
attributable to Alpha and Omega Semiconductor Limited used to
compute net income per share:
Basic
27,269
26,829
26,251
26,764
25,786
Diluted
28,466
28,423
27,705
28,203
27,272
Alpha and Omega Semiconductor
Limited
Condensed Consolidated Balance
Sheets
(in thousands, except par
value per share)
(unaudited)
June 30, 2022
June 30, 2021
ASSETS
Current assets:
Cash and cash equivalents
$
314,352
$
202,412
Restricted cash
299
233
Accounts receivable, net
65,681
35,789
Inventories
158,040
154,293
Other current assets
11,220
14,595
Total current assets
549,592
407,322
Property, plant and equipment, net
318,666
436,977
Operating lease right-of-use assets,
net
23,674
34,660
Intangible assets, net
10,050
13,410
Equity method investment
378,378
—
Deferred income tax assets
592
5,167
Restricted cash - long-term
—
2,168
Other long-term assets
17,677
18,869
Total assets
$
1,298,629
$
918,573
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable
$
87,377
$
80,699
Accrued liabilities
115,632
69,494
Payable related to equity investee,
net
28,989
—
Income taxes payable
4,248
2,604
Short-term debt
24,878
58,030
Finance lease liabilities
1,376
16,724
Operating lease liabilities
3,850
5,679
Total current liabilities
266,350
233,230
Long-term debt
38,156
77,990
Income taxes payable - long-term
2,158
1,319
Deferred income tax liabilities
28,757
2,448
Finance lease liabilities - long-term
9,634
12,698
Operating lease liabilities -
long-term
20,878
30,440
Other long-term liabilities
78,603
44,123
Total liabilities
444,536
402,248
Equity:
Preferred shares, par value $0.002 per
share:
Authorized: 10,000 shares; issued and
outstanding: none at June 30, 2022 and 2021
—
—
Common shares, par value $0.002 per
share:
Authorized: 100,000 shares; issued and
outstanding: 33,988 shares and 27,371 shares, respectively at June
30, 2022 and 32,975 shares and 26,350 shares, respectively at June
30, 2021
68
66
Treasury shares at cost; 6,617 shares at
June 30, 2022 and 6,625 shares at June 30, 2021
(66,000
)
(66,064
)
Additional paid-in capital
288,951
259,993
Accumulated other comprehensive income
1,080
2,315
Retained earnings
629,994
176,895
Total Alpha and Omega Semiconductor
Limited shareholders’ equity
854,093
373,205
Noncontrolling interest
—
143,120
Total equity
854,093
516,325
Total liabilities and equity
$
1,298,629
$
918,573
Alpha and Omega Semiconductor
Limited
Reconciliation of Condensed
Consolidated GAAP Financial Measures to Non-GAAP Financial
Measures
(in thousands, except
percentages and per share data)
(unaudited)
Three Months Ended
Fiscal Year Ended
June 30, 2022
March 31, 2022
June 30, 2021
June 30, 2022
June 30, 2021
GAAP gross profit
$
63,222
$
72,402
$
60,580
$
268,556
$
204,543
Share-based compensation
1,565
1,282
561
5,125
1,756
Amortization of purchased intangible
811
812
812
3,247
3,247
Production ramp up costs related to the JV
Company
—
—
—
—
275
Non-GAAP gross profit
$
65,598
$
74,496
$
61,953
$
276,928
$
209,821
Non-GAAP gross margin as a % of
revenue
33.8
%
36.7
%
34.9
%
35.6
%
31.9
%
GAAP operating expense
$
45,082
$
41,170
$
38,217
$
166,518
$
140,467
Share-based compensation
8,305
6,990
4,838
26,199
13,568
Legal costs related to government
investigation
84
221
553
1,030
3,066
Non-GAAP operating expense
$
36,693
$
33,959
$
32,826
$
139,289
$
123,833
GAAP operating income
$
18,140
$
31,232
$
22,363
$
102,038
$
64,076
Share-based compensation
9,870
8,272
5,399
31,324
15,324
Amortization of purchased intangible
811
812
812
3,247
3,247
Production ramp up costs related to the JV
Company
—
—
—
—
275
Legal costs related to government
investigation
84
221
553
1,030
3,066
Non-GAAP operating income
$
28,905
$
40,537
$
29,127
$
137,639
$
85,988
Non-GAAP operating margin as a % of
revenue
14.9
%
19.9
%
16.4
%
17.7
%
13.1
%
GAAP net income attributable to AOS
$
15,091
$
31,650
$
19,539
$
453,163
$
58,116
Share-based compensation
9,870
8,272
5,399
31,324
15,324
Amortization of purchased intangible
811
812
812
3,247
3,247
Gain on deconsolidation and changes of the
equity interest in the JV Company
—
(4,501
)
—
(395,953
)
—
Equity method investment loss from equity
investee
1,493
1,136
—
2,629
—
Production ramp up costs related to the JV
Company
—
—
—
—
135
Legal costs related to government
investigation
84
221
553
1,030
3,066
Income tax effect of non-GAAP
adjustments
(234
)
630
(2
)
33,197
53
Non-GAAP net income attributable to
AOS
$
27,115
$
38,220
$
26,301
$
128,637
$
79,941
Non-GAAP net margin attributable to AOS as
a % of revenue
14.0
%
18.8
%
14.8
%
16.5
%
12.2
%
GAAP net income attributable to AOS
$
15,091
$
31,650
$
19,539
$
453,163
$
58,116
Share-based compensation
9,870
8,272
5,399
31,324
15,324
Amortization and depreciation
8,588
8,603
13,251
42,851
52,685
Gain on deconsolidation and changes of the
equity interest in the JV Company
—
(4,501
)
—
(395,953
)
—
Equity method investment loss from equity
investee
1,493
1,136
—
2,629
—
Interest expense, net
895
308
1,476
3,920
6,308
Income tax expense
940
2,902
1,241
39,258
3,935
EBITDAS
$
36,877
$
48,370
$
40,906
$
177,192
$
136,368
GAAP diluted net income per share
attributable to AOS
$
0.53
$
1.11
$
0.71
$
16.07
$
2.13
Share-based compensation
0.35
0.29
0.19
1.11
0.56
Amortization of purchased intangible
0.03
0.03
0.03
0.11
0.12
Gain on deconsolidation and changes of the
equity interest in the JV Company
—
(0.16
)
—
(14.04
)
—
Equity method investment loss from equity
investee
0.05
0.04
—
0.09
—
Production ramp up costs related to the JV
Company
—
—
—
—
0.01
Legal costs related to government
investigation
0.00
0.01
0.02
0.04
0.11
Income tax effect of non-GAAP
adjustments
(0.01
)
0.02
0.00
1.18
0.00
Non-GAAP diluted net income per share
attributable to AOS
$
0.95
$
1.34
$
0.95
$
4.56
$
2.93
Shares used to compute GAAP diluted net
income per share
28,466
28,423
27,705
28,203
27,272
Shares used to compute Non-GAAP diluted
net income per share
28,466
28,423
27,705
28,203
27.272
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Investor and media inquiries:
The Blueshirt Group Gary Dvorchak, CFA In US +1 323 240 5796 In
China +86 (138) 1079-1480 gary@blueshirtgroup.com
Yujia Zhai The Blueshirt Group Yujia@blueshirtgroup.com +1 (860)
214-0809
Alpha and Omega Semicond... (NASDAQ:AOSL)
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