IoT Leader Achieves Significant Revenue Growth
in Industrial & Commercial and Home & Life Business
Units
AUSTIN, Texas , July 27,
2022 /PRNewswire/ -- Silicon Labs (NASDAQ:
SLAB), a leader in secure, intelligent wireless
technology for a more connected world, reported robust
financial results for the second quarter, which ended July 2, 2022. Revenue exceeded the top end of the
guidance range at $263 million, up
13% sequentially and 55% year-on-year.
"We continue to gain momentum, building on strong design win
performance, a growing opportunity funnel and market share
expansion despite the challenging macro environment. We delivered
record revenue in the quarter and operating results ahead of model,
driving strong EPS growth," said Matt
Johnson, President and Chief Executive Officer of Silicon
Labs. "We just marked the one-year anniversary of becoming a
pure-play IoT company, and we are more confident than ever in our
ability to lead and scale in the large and growing IoT wireless
market."
Second Quarter Financial Highlights
- Revenue increased to $263
million, up 13% sequentially and 55% year-on-year
- Industrial & Commercial revenue for the quarter was
$144 million, up 61%
year-on-year
- Home & Life revenue for the quarter was $119 million, up 49% year-on-year
- Gross margin of 62% was slightly favorable due to product mix
in the quarter
Results on a GAAP
basis:
- GAAP gross margin was 62%
- GAAP R&D expenses were $84
million
- GAAP SG&A expenses were $49
million
- GAAP operating income as a percentage of revenue was 12%
- GAAP diluted earnings per share were $0.60
Results on a non-GAAP basis, excluding the impact of stock
compensation, amortization of acquired intangible assets, and
certain other items as set forth in the reconciliation tables were
as follows:
- Non-GAAP gross margin was 62%
- Non-GAAP R&D expenses were $68
million
- Non-GAAP SG&A expenses were $41
million
- Non-GAAP operating income as a percentage of revenue was
21%
- Non-GAAP diluted earnings per share were $1.17
Business Highlights
- Announced a new Bluetooth Location Services solution using
accurate, low-power Bluetooth devices to simplify Angle of Arrival
(AoA) and Angle of Departure (AoD) location services. This new
platform combines the industry-leading energy efficiency of Silicon
Labs' BG22 system-in-a package (SiP) modules and SoCs, which can
operate for up to ten years on only a coin cell battery, with
advanced software that can track assets, improve indoor navigation,
and locate tags with sub-meter accuracy.
- Completed the buyback of $350
million of the company's shares through the most recent open
market repurchase program, resulting in the retirement of 2.5
million shares and bringing the year-to-date total for share
repurchases to $600 million, retiring
a total of 4.3 million shares. Additionally, the company's board of
directors has authorized a new $250
million open market repurchase program of the company's
common stock, through the end of 2023.
- Announced the appointment of Robert ("Bob") Conrad to the
company's board of directors. Conrad brings nearly 40 years of
experience in the semiconductor industry, most recently with NXP
Semiconductors (NASDAQ: NXPI) as SVP of the Automotive
Microcontrollers and Processors Business until his retirement in
2019. In addition, Bob brings significant experience driving
strategic focus and successfully scaling businesses.
- William ("Bill") Wood announced he will not stand for
reelection and will be retiring from the Silicon Labs board after
25 years of service. Bill joined the board of directors in 1997 and
served as lead director from 2005-2021. His board tenure concludes
at the 2023 annual meeting of stockholders.
"Bill Wood has been instrumental
to Silicon Labs' success since the very beginning of our journey,"
said Johnson. "We're grateful for his leadership throughout the
years and wish him the very best."
Business Outlook
The company expects third-quarter revenue to be in the range
of $265 to $275 million. The
company also estimates the following results:
On a GAAP basis:
- GAAP gross margin of approximately 60%
- GAAP operating expenses of approximately $137 million
- GAAP effective tax rate of approximately 36%
- GAAP diluted earnings per share between $0.49 to $0.59
On a non-GAAP basis, excluding the impact of stock compensation,
amortization of acquired intangible assets, and certain other items
as set forth in the reconciliation tables:
- Non-GAAP gross margin of approximately 60.5%
- Non-GAAP operating expenses of approximately $113 million
- Non-GAAP effective tax rate of approximately 26%
- Non-GAAP diluted earnings per share between $1.08 to $1.18
Earnings Webcast and Conference Call
Silicon Labs will host an earnings conference call to discuss
the quarterly results and answer questions at 7:30 am CDT today. An audio webcast will be
available on Silicon 'Labs' website (www.silabs.com) under Investor
Relations. In addition, the company will post an audio recording of
the event at silabs.com/investors and make a replay available
through August 3, 2022, online or by
calling (877) 344-7529 (US) or (412) 317-0088 (international) and
entering access code 2437694.
About Silicon Labs
Silicon Labs (NASDAQ: SLAB) is a leader in secure,
intelligent wireless technology for a more connected
world. Our integrated hardware and software platform,
intuitive development tools, thriving ecosystem, and
robust support make us an ideal long-term partner in building
advanced industrial, commercial, home and life
applications. We make it easy for developers to solve
complex wireless challenges throughout the
product lifecycle and get to market
quickly with innovative solutions that transform
industries, grow economies, and improve lives.
silabs.com
Forward-Looking Statements
This press release contains forward-looking statements based on
Silicon Labs' current expectations. The words "believe",
"estimate", "expect", "intend", "anticipate", "plan", "project",
"will", and similar phrases as they relate to Silicon Labs are
intended to identify such forward-looking statements. These
forward-looking statements reflect the current views and
assumptions of Silicon Labs and are subject to various risks and
uncertainties that could cause actual results to differ materially
from expectations. Among the factors that could cause actual
results to differ materially from those in the forward-looking
statements are the following: the timing and scope of share
repurchases, and/or dividends; the impact of COVID-19 on the U.S.
and global economy, including the restrictions on travel and
transportation and other actions taken by governmental authorities
and disruptions to the business of our customers or our global
supply chain that have occurred or may occur in the future, the
ongoing impact of COVID-19 on our employees and our ability to
provide services to our customers and respond to their needs; risks
that Silicon Labs may not be able to maintain its historical
growth; quarterly fluctuations in revenues and operating results;
difficulties developing new products that achieve market
acceptance; risks associated with international activities
(including trade barriers, particularly with respect to
China); intellectual property
litigation risks; risks associated with acquisitions and
divestitures; product liability risks; difficulties managing and/or
obtaining sufficient supply from Silicon Labs' distributors,
manufacturers and subcontractors; dependence on a limited number of
products; absence of long-term commitments from customers;
inventory-related risks; difficulties managing international
activities; risks that Silicon Labs may not be able to manage
strains associated with its growth; credit risks associated with
its accounts receivable; dependence on key personnel; stock price
volatility; geographic concentration of manufacturers, assemblers,
test service providers and customers in Asia that subjects Silicon Labs' business and
results of operations to risks of natural disasters, epidemics or
pandemics, war and political unrest, including risks that demand
and the supply chain may be adversely affected by military conflict
(including between Russia and
Ukraine), terrorism, sanctions or
other geopolitical events globally; debt-related risks;
capital-raising risks; the competitive and cyclical nature of the
semiconductor industry; average selling prices of products may
decrease significantly and rapidly; information technology risks;
cyber-attacks against Silicon Labs' products and its networks and
other factors that are detailed in the SEC filings of Silicon
Laboratories Inc. The level of share repurchases and/or dividends
depends on market conditions and the level of other uses of cash.
Silicon Labs disclaims any intention or obligation to update or
revise any forward-looking statements, whether as a result of new
information, future events, or otherwise. References in this press
release to Silicon Labs shall mean Silicon Laboratories Inc.
Note to editors: Silicon Laboratories, Silicon Labs, the "S"
symbol, and the Silicon Labs logo are trademarks of Silicon
Laboratories Inc. All other product names noted herein may be
trademarks of their respective holders.
Silicon Laboratories
Inc.
|
Condensed
Consolidated Statements of Income
|
(In thousands,
except per share data)
|
(Unaudited)
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
July 2,
2022
|
|
July 3,
2021
|
|
July 2,
2022
|
|
July 3,
2021
|
Revenues
|
$263,150
|
|
$169,492
|
|
$496,964
|
|
$327,349
|
Cost of
revenues
|
99,247
|
|
73,194
|
|
177,289
|
|
139,297
|
Gross profit
|
163,903
|
|
96,298
|
|
319,675
|
|
188,052
|
Operating
expenses:
|
|
|
|
|
|
|
|
Research
and development
|
83,511
|
|
64,832
|
|
161,053
|
|
128,847
|
Selling,
general and administrative
|
49,013
|
|
42,953
|
|
93,660
|
|
85,407
|
Operating
expenses
|
132,524
|
|
107,785
|
|
254,713
|
|
214,254
|
Operating income
(loss)
|
31,379
|
|
(11,487)
|
|
64,962
|
|
(26,202)
|
Other income
(expense):
|
|
|
|
|
|
|
|
Interest
income and other, net
|
3,445
|
|
475
|
|
4,944
|
|
1,624
|
Interest
expense
|
(1,667)
|
|
(6,486)
|
|
(3,347)
|
|
(17,810)
|
Income (loss) from
continuing operations before income taxes
|
33,157
|
|
(17,498)
|
|
66,559
|
|
(42,388)
|
Provision for income
taxes
|
10,994
|
|
1,165
|
|
22,683
|
|
3,157
|
Equity-method
earnings
|
(28)
|
|
172
|
|
1,166
|
|
1,898
|
Income (loss) from
continuing operations
|
22,135
|
|
(18,491)
|
|
45,042
|
|
(43,647)
|
Income from
discontinued operations, net of income taxes
|
--
|
|
38,423
|
|
--
|
|
77,088
|
|
|
|
|
|
|
|
|
Net income
|
$
22,135
|
|
$
19,932
|
|
$
45,042
|
|
$
33,441
|
|
|
|
|
|
|
|
|
Basic earnings (loss)
per share:
|
|
|
|
|
|
|
|
Continuing
operations
|
$ 0.62
|
|
$
(0.41)
|
|
$ 1.22
|
|
$
(0.98)
|
Net
income
|
$ 0.62
|
|
$ 0.44
|
|
$ 1.22
|
|
$ 0.75
|
|
|
|
|
|
|
|
|
Diluted earnings (loss)
per share:
|
|
|
|
|
|
|
|
Continuing
operations
|
$ 0.60
|
|
$
(0.41)
|
|
$ 1.18
|
|
$
(0.98)
|
Net
income
|
$ 0.60
|
|
$ 0.44
|
|
$ 1.18
|
|
$ 0.73
|
|
|
|
|
|
|
|
|
Weighted-average common
shares outstanding:
|
|
|
|
|
|
|
|
Basic
|
35,722
|
|
44,803
|
|
36,862
|
|
44,481
|
Diluted
|
36,604
|
|
45,756
|
|
38,063
|
|
45,794
|
Non-GAAP Financial Measurements
In addition to the GAAP results provided throughout this
document, Silicon Labs has provided non-GAAP financial measurements
on a basis excluding non-cash and other charges and benefits.
Details of these excluded items are presented in the tables below,
which reconcile the GAAP results to non-GAAP financial
measurements.
The non-GAAP financial measurements do not replace the
presentation of Silicon Labs' GAAP financial results. These
measurements provide supplemental information to assist management
and investors in analyzing Silicon Labs' financial position and
results of operations. Silicon Labs has chosen to provide this
information to investors to enable them to perform meaningful
comparisons of past, present and future operating results and as a
means to emphasize the results of core on-going operations.
Unaudited
Reconciliation of GAAP to Non-GAAP Financial
Measures
|
(In thousands,
except per share data)
|
|
|
|
Three Months
Ended
July 2,
2022
|
Non-GAAP Income
Statement Items
|
|
GAAP
Measure
|
|
GAAP
Percent of
Revenue
|
|
Stock
Compensation
Expense
|
|
Intangible
Asset
Amortization
|
|
Non-
GAAP
Measure
|
|
Non-GAAP
Percent of
Revenue
|
Revenues
|
|
$263,150
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit
|
|
163,903
|
|
62.3 %
|
|
$ 274
|
|
$
--
|
|
$164,177
|
|
62.4 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development
|
|
83,511
|
|
31.7 %
|
|
7,703
|
|
7,363
|
|
68,445
|
|
26.0 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative
|
|
49,013
|
|
18.7 %
|
|
6,412
|
|
1,479
|
|
41,122
|
|
15.6 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
31,379
|
|
11.9 %
|
|
14,389
|
|
8,842
|
|
54,610
|
|
20.8 %
|
|
|
Three Months
Ended
July 2,
2022
|
|
Non-GAAP Earnings
Per Share
|
|
GAAP
Measure
|
|
Stock
Compensation
Expense*
|
|
Intangible
Asset
Amortization*
|
|
Equity-Method
Investment
Adjustments*
|
|
Income
Tax
Adjustments
|
|
Non-
GAAP
Measure
|
Net income
|
|
$22,135
|
|
$14,389
|
|
$8,842
|
|
$28
|
|
$(2,631)
|
|
$42,763
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted shares
outstanding
|
|
36,604
|
|
|
|
|
|
|
|
|
|
36,604
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share
|
|
$
0.60
|
|
|
|
|
|
|
|
|
|
$
1.17
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Represents pre-tax
amounts
|
Unaudited
Forward-Looking Statements Regarding Business
Outlook
|
(In millions, except
per share data)
|
|
Business
Outlook
|
|
Three Months
Ending
October 1,
2022
|
|
|
GAAP
Measure
|
|
Non-GAAP
Adjustments*
|
|
Non-GAAP
Measure
|
Gross margin
|
|
60 %
|
|
0.5 %
|
|
60.5 %
|
|
|
|
|
|
|
|
Operating
expenses
|
|
$137
|
|
$(24)
|
|
$113
|
|
|
|
|
|
|
|
Effective tax
rate
|
|
36 %
|
|
(10) %
|
|
26 %
|
|
|
|
|
|
|
|
Diluted earnings per
share - low
|
|
$0.49
|
|
$0.59
|
|
$1.08
|
|
|
|
|
|
|
|
Diluted earnings per
share - high
|
|
$0.59
|
|
$0.59
|
|
$1.18
|
|
|
|
|
|
|
|
* Non-GAAP adjustments
include the following estimates: stock compensation expense of
$16.3 million, intangible asset amortization of
$8.1 million and the associated tax impact from the
aforementioned items.
|
Silicon Laboratories
Inc.
|
Condensed
Consolidated Balance Sheets
|
(In thousands,
except per share data)
|
(Unaudited)
|
|
|
July
2,
2022
|
|
January 1,
2022
|
Assets
|
|
|
|
Current
assets:
|
|
|
|
Cash and
cash equivalents
|
$
504,850
|
|
$1,074,623
|
Short-term
investments
|
972,845
|
|
964,582
|
Accounts
receivable, net
|
72,106
|
|
98,313
|
Inventories
|
74,026
|
|
49,307
|
Prepaid
expenses and other current assets
|
86,138
|
|
51,748
|
Total current
assets
|
1,709,965
|
|
2,238,573
|
Property and equipment,
net
|
149,447
|
|
146,516
|
Goodwill
|
376,389
|
|
376,389
|
Other intangible
assets, net
|
99,784
|
|
118,978
|
Other assets,
net
|
83,813
|
|
77,839
|
Total assets
|
$2,419,398
|
|
$2,958,295
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$ 95,365
|
|
$ 47,327
|
Current
portion of convertible debt, net
|
--
|
|
450,599
|
Deferred
revenue and returns liability
|
10,696
|
|
13,849
|
Other
current liabilities
|
126,058
|
|
157,052
|
Total current
liabilities
|
232,119
|
|
668,827
|
Convertible debt,
net
|
528,564
|
|
--
|
Other non-current
liabilities
|
53,371
|
|
77,044
|
Total
liabilities
|
814,054
|
|
745,871
|
Commitments and
contingencies
|
|
|
|
Stockholders'
equity:
|
|
|
|
Preferred
stock – $0.0001 par value; 10,000
shares authorized; no
shares
issued
|
--
|
|
--
|
Common
stock – $0.0001 par value; 250,000
shares authorized;
34,223 and 38,481
shares issued and outstanding at
July 2, 2022 and
January 1, 2022, respectively
|
3
|
|
4
|
Retained
earnings
|
1,619,396
|
|
2,214,839
|
Accumulated other comprehensive loss
|
(14,055)
|
|
(2,419)
|
Total stockholders'
equity
|
1,605,344
|
|
2,212,424
|
Total liabilities and
stockholders' equity
|
$2,419,398
|
|
$2,958,295
|
Silicon Laboratories
Inc.
|
Condensed
Consolidated Statements of Cash Flows
|
(In
thousands)
|
(Unaudited)
|
|
|
Six Months
Ended
|
|
July
2,
2022
|
|
July 3,
2021
|
Operating
Activities
|
|
|
|
Net income
|
$ 45,042
|
|
$
33,441
|
Adjustments to
reconcile net income to cash provided by operating
activities
of
continuing operations:
|
|
|
|
Income
from discontinued operations, net of income taxes
|
--
|
|
(77,088)
|
Depreciation of property and equipment
|
10,561
|
|
8,184
|
Amortization of other intangible assets
|
19,194
|
|
22,902
|
Amortization of debt discount and debt issuance
costs
|
994
|
|
11,822
|
Loss on
extinguishment of convertible debt
|
3
|
|
3,370
|
Stock-based compensation
expense
|
27,264
|
|
22,620
|
Equity-method earnings
|
(1,166)
|
|
(1,898)
|
Deferred
income taxes
|
(9,344)
|
|
(5,644)
|
Changes in
operating assets and liabilities:
|
|
|
|
Accounts
receivable
|
26,207
|
|
(4,377)
|
Inventories
|
(24,714)
|
|
(4,447)
|
Prepaid expenses and
other assets
|
(25,286)
|
|
(3,591)
|
Accounts
payable
|
25,606
|
|
14,711
|
Other current
liabilities and income taxes
|
(3,418)
|
|
(10,626)
|
Deferred revenue and
returns liability
|
(3,153)
|
|
(175)
|
Other non-current
liabilities
|
(4,416)
|
|
(3,464)
|
Net cash provided by
operating activities of continuing operations
|
83,374
|
|
5,740
|
|
|
|
|
Investing
Activities
|
|
|
|
Purchases of marketable
securities
|
(554,267)
|
|
(80,426)
|
Sales of marketable
securities
|
27,404
|
|
186,626
|
Maturities of
marketable securities
|
511,296
|
|
100,023
|
Purchases of property
and equipment
|
(12,322)
|
|
(10,779)
|
Purchases of other
assets
|
--
|
|
(578)
|
Net cash provided by
(used in) investing activities of continuing operations
|
(27,889)
|
|
194,866
|
|
|
|
|
Financing
Activities
|
|
|
|
Payments on
debt
|
(21)
|
|
(140,572)
|
Repurchases of common
stock
|
(579,040)
|
|
(18,982)
|
Payment of taxes
withheld for vested stock awards
|
(13,958)
|
|
(19,732)
|
Proceeds from the
issuance of common stock
|
6,365
|
|
8,388
|
Net cash used in
financing activities of continuing operations
|
(586,654)
|
|
(170,898)
|
|
|
|
|
Discontinued
Operations
|
|
|
|
Operating
activities
|
(38,604)
|
|
72,674
|
Investing
activities
|
--
|
|
(2,018)
|
Net cash provided by
(used in) discontinued operations
|
(38,604)
|
|
70,656
|
|
|
|
|
Increase (decrease) in
cash and cash equivalents
|
(569,773)
|
|
100,364
|
Cash and cash
equivalents at beginning of period
|
1,074,623
|
|
202,720
|
Cash and cash
equivalents at end of period
|
$
504,850
|
|
$303,084
|
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SOURCE Silicon Labs