Alpha and Omega Semiconductor Limited (“AOS”) (NASDAQ: AOSL)
today reported financial results for the fiscal first quarter of
2024 ended September 30, 2023.
The results for the fiscal first quarter of 2024 ended September
30, 2023 were as follows:
GAAP Financial
Comparison
Quarterly
(in millions, except percentage
and per share data)
(unaudited)
Three Months Ended
September 30, 2023
June 30, 2023
September 30, 2022
Revenue
$
180.6
$
161.5
$
208.5
Gross Margin
28.2
%
27.6
%
34.1
%
Operating Income
$
9.4
$
2.6
$
25.5
Net Income (Loss)
$
5.8
$
(1.1
)
$
26.0
Net Income (Loss) Per Share - Diluted
$
0.19
$
(0.04
)
$
0.88
Non-GAAP Financial
Comparison
Quarterly
(in millions, except percentage
and per share data)
(unaudited)
Three Months Ended
September 30, 2023
June 30, 2023
September 30, 2022
Revenue
$
180.6
$
161.5
$
208.5
Non-GAAP Gross Margin
28.8
%
28.5
%
35.4
%
Non-GAAP Operating Income
$
11.2
$
6.9
$
37.1
Non-GAAP Net Income
$
9.9
$
5.7
$
35.2
Non-GAAP Net Income Per Share -
Diluted
$
0.33
$
0.19
$
1.20
The non-GAAP financial measures in the schedule above and under
the section “Financial Results for Fiscal Q1 Ended September 30,
2023” below exclude the effect of share-based compensation
expenses, amortization of purchased intangible, legal costs related
to government investigation, equity method investment (loss) income
from equity investee, and income tax effect of non-GAAP adjustments
in each of the periods presented. A detailed reconciliation of GAAP
and non-GAAP financial measures is included at the end of this
press release.
Financial Results for Fiscal Q1 Ended September 30,
2023
- Revenue was $180.6 million, an increase of 11.8% from the prior
quarter and a decrease of 13.4% from the same quarter last
year.
- GAAP gross margin was 28.2%, up from 27.6% in the prior quarter
and down from 34.1% in the same quarter last year.
- Non-GAAP gross margin was 28.8%, up from 28.5% in the prior
quarter and down from 35.4% in the same quarter last year.
- GAAP operating expenses were $41.5 million, down from $42.0
million in the prior quarter and down from $45.6 million in the
same quarter last year.
- Non-GAAP operating expenses were $40.8 million, up from $39.1
million from last quarter and up from $36.6 million in the same
quarter last year.
- GAAP operating income was $9.4 million, up from $2.6 million of
operating income in the prior quarter and down from $25.5 million
of operating income in the same quarter last year.
- Non-GAAP operating income was $11.2 million as compared to $6.9
million of operating income for the prior quarter and $37.1 million
of operating income for the same quarter last year.
- GAAP net income per diluted share was $0.19, compared to $0.04
net loss per share for the prior quarter, and $0.88 net income per
share for the same quarter a year ago.
- Non-GAAP net income per share was $0.33 compared to $0.19 net
income per share for the prior quarter and $1.20 net income per
share for the same quarter a year ago.
- Consolidated cash flow provided by operating activities was
$13.8 million, as compared to negative $28.2 million in the prior
quarter.
- The Company closed the quarter with $193.6 million of cash and
cash equivalents.
AOS Chief Executive Officer Stephen Chang commented, “We
delivered solid fiscal Q1 results driven by an encouraging rebound
in PC and smartphone shipments for fall device launches and the
holiday season. Looking forward, we remain cautious about a
sustained broader recovery as we are seeing signs of demand
constraints in other end markets, which are affected by the
persistent high-interest rate environment and geopolitical
uncertainties.”
Mr. Chang continued, “Despite ongoing market challenges, we are
focused on positioning AOS towards long-term growth by extending
the reach of our business into new applications and broadening our
product portfolio to address increasing global power trends. We
also aim to deepen our penetration in our core markets with
integrated solutions and drive higher BOM content. We believe the
fundamentals of our business remain strong driven by record Tier 1
customer partnerships and market share across many of our end
markets and we continue to expect to navigate the current
environment better than the broader market that we serve.”
Business Outlook for Fiscal Q2 Ending December 31,
2023
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.
Our expectations for the second quarter of fiscal year 2024 are
as follows:
- Revenue to be approximately $165 million, plus or minus $10
million.
- GAAP gross margin to be 27.1%, plus or minus 1%. We anticipate
non-GAAP gross margin to be 28.5%, plus or minus 1%.
- GAAP operating expenses to be in the range of $48.0 million,
plus or minus $1 million. Non-GAAP operating expenses are expected
to be in the range of $40.3 million, plus or minus $1 million.
- Interest expense to be approximately $1.1 million, and
- Income tax expense to be in the range of $0.8 million to $1.2
million.
Conference Call and Webcast
AOS plans to hold an investor teleconference and live webcast to
discuss the financial results for the fiscal first quarter ended
September 30, 2023 today, November 6, 2023 at 2:00 p.m. PT / 5:00
p.m. ET. To listen to the live conference call, please dial +1
(833) 470-1428 or +1 (404) 975-4839 if dialing from outside the
United States and Canada. The access code is 198548. 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, market
trends in the semiconductor industry; our ability to mitigate
economic downturns; seasonality of our business, our ability to
penetrate new markets and achieve long-term growth, our annual
revenue target, projected amount of revenue, gross margin,
operating income (loss), income tax expenses, net income (loss),
and share-based compensation expenses, non-GAAP gross margin,
non-GAAP operating expenses, income tax expenses, our ability to
continue to win and acquire market share and other information
under the section entitled “Business Outlook for Fiscal Q2 Ending
December 31, 2023”. 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 state of semiconductor
industry and seasonality of our markets; government policies on our
business operations in China; our lack of control over the joint
venture in China; difficulties and challenges in executing our
diversification strategy into different market segments; 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; 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, 2023 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.
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 expenses,
operating income (loss), net income (loss), diluted earnings per
share ("EPS") and EBITDAS. These supplemental measures exclude,
among other items, share-based compensation expenses, legal and
profession fees related to government investigation, amortization
of purchased intangible, income tax effect of non-GAAP adjustments
and equity method investment (loss) income from equity investee. We
also disclose certain non-GAAP financial measures in our guidance
for the next quarter, including non-GAAP gross margin and operating
expenses. 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 amount of income tax
effect of non-GAAP adjustments in the non-GAAP net income (loss) 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 providing 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 technologies, product design,
and advanced packaging know-how to develop high performance power
management solutions. AOS’ portfolio of products targets
high-volume applications, including portable computers, graphic
cards, flat panel TVs, home appliances, 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 condensed 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
September 30,
2023
June 30, 2023
September 30,
2022
Revenue
$
180,633
$
161,525
$
208,476
Cost of goods sold
129,708
116,944
137,348
Gross profit
50,925
44,581
71,128
Gross margin
28.2
%
27.6
%
34.1
%
Operating expenses:
Research and development
22,113
22,711
21,389
Selling, general and administrative
19,431
19,258
24,205
Total operating expenses
41,544
41,969
45,594
Operating income
9,381
2,612
25,534
Other income (loss), net
26
(298
)
(16
)
Interest income (expense), net
229
(87
)
(608
)
Net income before income taxes
9,636
2,227
24,910
Income tax expense
1,138
387
1,374
Net income before income (loss) from
equity method investment
8,498
1,840
23,536
Equity method investment income (loss)
from equity investee
(2,712
)
(2,944
)
2,502
Net income (loss)
$
5,786
$
(1,104
)
$
26,038
Net income (loss) per common share
Basic
$
0.21
$
(0.04
)
$
0.95
Diluted
$
0.19
$
(0.04
)
$
0.88
Weighted average number of common shares
used to compute net income (loss) per share
Basic
27,693
27,598
27,391
Diluted
29,786
27,598
29,423
Alpha and Omega Semiconductor
Limited
Condensed Consolidated Balance
Sheets
(in thousands, except par
value per share)
(unaudited)
September 30, 2023
June 30, 2023
ASSETS
Current assets:
Cash and cash equivalents
$
193,576
$
195,188
Restricted cash
206
415
Accounts receivable, net
34,403
22,420
Inventories
187,751
183,247
Other current assets
23,993
22,666
Total current assets
439,929
423,936
Property, plant and equipment, net
354,229
357,831
Operating lease right-of-use assets
26,582
24,349
Intangible assets, net
5,953
6,765
Equity method investment
357,878
366,617
Deferred income tax assets
518
536
Other long-term assets
21,278
19,703
Total assets
$
1,206,367
$
1,199,737
LIABILITIES AND SHAREHOLDERS'
EQUITY
Current liabilities:
Accounts payable
$
52,268
$
50,775
Accrued liabilities
83,948
79,533
Payable related to equity investee,
net
20,115
11,950
Income taxes payable
4,691
5,546
Short-term debt
11,483
11,434
Deferred revenue
9,181
8,073
Finance lease liabilities
884
867
Operating lease liabilities
4,977
4,383
Total current liabilities
187,547
172,561
Long-term debt
35,470
38,360
Income taxes payable - long-term
2,871
2,817
Deferred income tax liabilities
26,083
27,283
Finance lease liabilities - long-term
2,989
3,216
Operating lease liabilities -
long-term
22,155
20,544
Other long-term liabilities
43,973
51,037
Total liabilities
321,088
315,818
Shareholders' Equity:
Preferred shares, par value $0.002 per
share:
Authorized: 10,000 shares; issued and
outstanding: none at September 30, 2023 and June 30, 2023
—
—
Common shares, par value $0.002 per
share:
Authorized: 100,000 shares; issued and
outstanding: 34,903 shares and 27,746 shares, respectively at
September 30, 2023 and 34,811 shares and 27,654 shares,
respectively at June 30, 2023
70
70
Treasury shares at cost: 7,157 shares at
September 30, 2023 and 7,157 shares at June 30, 2023
(79,365
)
(79,365
)
Additional paid-in capital
330,015
329,034
Accumulated other comprehensive income
(13,518
)
(8,111
)
Retained earnings
648,077
642,291
Total shareholders' equity
885,279
883,919
Total liabilities and shareholders'
equity
$
1,206,367
$
1,199,737
Alpha and Omega Semiconductor
Limited
Selected Cash Flow
Information
( in thousands,
unaudited)
Three Months Ended September
30,
2023
2022
Net cash provided by operating
activities
$
13,823
$
36,675
Net cash used in investing activities
(12,510
)
(39,974
)
Net cash provided by (used in) financing
activities
(2,999
)
5,462
Effect of exchange rate changes on cash,
cash equivalents and restricted cash
(135
)
(417
)
Net increase (decrease) in cash, cash
equivalents and restricted cash
(1,821
)
1,746
Cash, cash equivalents and restricted cash
at beginning of period
195,603
314,651
Cash, cash equivalents and restricted cash
at end of period
$
193,782
$
316,397
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
September 30,
2023
June 30, 2023
September 30,
2022
GAAP gross profit
$
50,925
$
44,581
$
71,128
Share-based compensation
212
592
1,788
Amortization of purchased intangible
812
812
812
Non-GAAP gross profit
$
51,949
$
45,985
$
73,728
Non-GAAP gross margin as a % of
revenue
28.8
%
28.5
%
35.4
%
GAAP operating expense
$
41,544
$
41,969
$
45,594
Share-based compensation
706
2,777
8,808
Legal costs related to government
investigation
52
99
142
Non-GAAP operating expense
$
40,786
$
39,093
$
36,644
GAAP operating income
$
9,381
$
2,612
$
25,534
Share-based compensation
918
3,369
10,596
Amortization of purchased intangible
812
812
812
Legal costs related to government
investigation
52
99
142
Non-GAAP operating income
$
11,163
$
6,892
$
37,084
Non-GAAP operating margin as a % of
revenue
6.2
%
4.3
%
17.8
%
GAAP net income (loss)
$
5,786
$
(1,104
)
$
26,038
Share-based compensation
918
3,369
10,596
Amortization of purchased intangible
812
812
812
Equity method investment (income) loss
from equity investee
2,712
2,944
(2,502
)
Legal costs related to government
investigation
52
99
142
Income tax effect of non-GAAP
adjustments
(406
)
(397
)
119
Non-GAAP net income
$
9,874
$
5,723
$
35,205
Non-GAAP net margin as a % of revenue
5.5
%
3.5
%
16.9
%
GAAP net income (loss)
$
5,786
$
(1,104
)
$
26,038
Share-based compensation
918
3,369
10,596
Amortization and depreciation
12,951
12,045
9,352
Equity method investment (income) loss
from equity investee
2,712
2,944
(2,502
)
Interest expense (income), net
(229
)
87
608
Income tax expense
1,138
387
1,374
EBITDAS
$
23,276
$
17,728
$
45,466
GAAP diluted net income (loss) per
share
$
0.19
$
(0.04
)
$
0.88
Share-based compensation
0.03
0.11
0.36
Amortization of purchased intangible
0.03
0.03
0.03
Equity method investment (income) loss
from equity investee
0.09
0.10
(0.09
)
Legal costs related to government
investigation
0.00
0.00
0.01
Income tax effect of non-GAAP
adjustments
(0.01
)
(0.01
)
0.01
Non-GAAP diluted net income per share
$
0.33
$
0.19
$
1.20
Shares used to compute GAAP diluted net
income (loss) per share
29,786
27,598
29,423
Shares used to compute Non-GAAP diluted
net income (loss) per share
29,786
29,382
29,423
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Investor and media inquiries:
The Blueshirt Group Gary Dvorchak, CFA In US +1 323 240 5796 In
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Yujia Zhai The Blueshirt Group Yujia@blueshirtgroup.com +1 (860)
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