Cirrus Logic, Inc. · NASDAQ:CRUS
Cirrus Logic — NASDAQ London Investor Program 2015
24 slides from Cirrus Logic's conference presentation, Dec 2, 2015
Slide 1: NASDAQ London Investor Program Presentation
NASDAQ London Investor Program Presentation December 2, 2015 Advanced Signal Processing Products
Slide 2: Safe Harbor Statement
Safe Harbor Statement Except for historical information contained herein, the matters set forth in this presentation contain forward-looking statements, including industry market projections; our revenue growth opportunities; our forecasted revenue, gross margin and R&D and SG&A expenses; and our es
Slide 3: Cirrus Logic at a Glance
Cirrus Logic at a Glance • Founded 1984 • Listed on NASDAQ: CRUS • FY15 revenue $916.6M PROFILE • Headquartered in Austin, Texas with ~1,200 Employees Worldwide • Fabless • Products: Codecs, Digital Signal Processors, Amplifiers and MEMS Microphones PRODUCTS • Product Applications: Portable, Non-Por
Slide 4: Compelling Business Strategy
Compelling Business Strategy LEVERAGE BEST IN CLASS IP HIGH OPERATING EXPAND WITH MORE CONTENT, MORE TARGET FAST MARGINS GROWING MARKETS BOXES STRONG CASH FLOW DESIGN BEST-IN- CLASS CUSTOM, ENGAGE TIER-ONE SEMI-CUSTOM & LEADING SUPPLIER MARKET LEADERS GENERAL MARKET PRODUCTS OF COMPLETE AUDIO SIGNAL
Slide 5: Focus on Tier One Customers
Focus on Tier One Customers • Approximately 3,100 customers worldwide • In Q2 FY16, our top two customers represented 63% and 18% of total revenue • Majority of products sold through direct sales channels 5
Slide 6: Unique Corporate Culture
Unique Corporate Culture SUPPORT O M M UNITY “Best Places to Work” C 2011-2015 WORK HARD , PLAY HARD 6
Slide 7: Market & Product Overview
MARKET & PRODUCT OVERVIEW ih
Slide 8: From Capture to Playback: Our Product Offerings
From Capture to Playback: Our Product Offerings SMART CODEC MEMS Audio Audio Audio Audio åß Mics Codec DSP Software Amplifiers CODEC + DSP + Embedded Software Cirrus Logic is a Leading Supplier of a Comprehensive Hardware & Software Solution Spanning the Entire Audio Signal Chain 8
Slide 9: Performance & Content: Evolution of Flagship Audio Codecs
Evolution of Flagship Audio Codecs* • 65nm/55nm • > 600 MIPS • Lower Power • 65nm • Reduced PCB size Performance & Content • 600 MIPS • Improved Codec • +120dB Playback SNR • + Enhanced multi- • 152nm • + Active Noise microphone capability • 50 MIPS Cancellation (ANC) • + Far-field Voice & • + Voice
Slide 10: Opportunity to Expand Total Content
Opportunity to Expand Total Content MEMS MICROPHONES Potential Content Per Up to four per device / ASPs ~$0.20 - $0.30 Device* ~$4.00 SMART CODEC + One per device / ASPs ~$2.50 - $3.50 vs. EMBEDDED SOFTWARE Previous Content Per Device** AUDIO AMPLIFIERS Up to two per device / ASPs ~$0.50 - $0.75 ~$1
Slide 11: Accelerating Investment in Key Projects
Accelerating Investment in Key Projects • Integrate functionality of several discrete chips into one SMART CODECS • Reduce board space and customer BOM while commanding higher ASPs • Enable enhanced features/functionality including intelligent MEMS communication between audio chips and environmental
Slide 12: Focused on Rapidly Growing Markets
Focused on Rapidly Growing Markets Portable Audio Opportunity Continuing to Grow Served Available Market Opportunity Long-Term: • Audio/voice features growing in complexity and differentiation value • Customers require very low power mixed signal audio $5.4B solutions • Audio/voice features continue
Slide 13: Leveraging Technology Beyond Mobile
Leveraging Technology Beyond Mobile Wearables Accessories Automotive Audio Connected Home 13
Slide 14: Non-Portable Audio & Other: Solid Base Business
Non-Portable Audio & Other: Solid Base Business AUTOMOTIVE CONSUMER ENERGY INDUSTRIAL ESTABLISHED CORE BUSINESS WITH STRONG CUSTOMER BASE (Sony, Harman, Bose, Ford, LG) COMPREHENSIVE PRODUCT PORTFOLIO (ADC, DAC, CODEC, DSP, Interface, Amps) HIGH DOLLAR CONTENT AND STABLE MARGINS (Up to $13 per box)
Slide 15: Positioning Company for Long-Term Growth
Positioning Company for Long-Term Growth Expanding Market Opportunity: • Need for ultra-low power sophisticated processing driving smart codec adoption • Subset of flagship features migrating into mid-tier market Potential for More Content Per Box: • Near-term: cross-selling amplifiers and smart cod
Slide 16: Cirrus Logic's Advantage
Cirrus Logic’s Advantage Technology Leadership: • Comprehensive hardware and software solution from capture to playback • Extensive IP portfolio – more than 2,100 patents worldwide • Strong engineering culture and execution – over 700 engineers • Substantial investment in R&D - $197.9M* in FY15, up
Slide 17: Financials
FINANCIALS 17
Slide 18: Financial Highlights
Financial Highlights • $165.2M total cash, down from the prior quarter largely due the timing of receivables, the repurchase of common stock, the acquisition of two BALANCE SHEET small technology companies and an increase in inventory • $160.4M debt associated with the Wolfson acquisition • Q2 endin
Slide 19: Strong Cash Position
Strong Cash Position Operating Cash Flow Potential Use of Cash • Increased investment in R&D • Acquisitions $164M • Share repurchase • Repayment of debt 45% CAGR • Infrastructure improvements $25M FY2010 FY2015 19
Slide 20: R&D Investment: Driving Future Growth Opportunities
R&D Investment: Driving Future Growth Opportunities $M 100 90 1,198 80 1,125 1,099** 1,102 1,104 70 751 739 735 60 678 Expense* 50 SG&A R&D 40 Headcount 30 20 10 0 Q2/FY14 Q3/FY14 Q4/FY14 Q1/FY15 Q2/FY15 Q3/FY15 Q4/FY15 Q1/FY16 Q2/FY16 Q3/FY16 *Reflects midpoint of combined R&D and SG&A guidance as
Slide 21: Operating Margin Profile
Operating Margin Profile 35% GAAP Non-GAAP* 30% 30% 27% 25% 27% 23% 24% 21% 20% 20% 19% 18% 17% 16% 15% 18% 15% 14% 13% 10% 12% 10% 9%** 5% 0% Q2/FY14 Q3/FY14 Q4/FY14 Q1/FY15 Q2/FY15 Q3/FY15 Q4/FY15 Q1/FY16 Q2/FY16 *GAAP to non-GAAP reconciliations available on slide 24 and at www.cirrus.com **Inclu
Slide 22: Financial Results and Outlook
Financial Results and Outlook September Quarter Results (Q2) $307 $385* $299 $283 • Revenue: $306.8M $191 $219 $210 $255 $150 $153 • Gross Margin: 46.4% • OpEx: $98.1M (incl. $8.3M in stock comp, $8.1M in amort.) December Quarter Guidance (Q3)* • Revenue: $370M - $400M • Gross Margin GAAP 46% - 48%
Slide 23: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation We use these Non-GAAP financial numbers to assist us in the management of the Company because we believe that this information provides a more consistent and complete understanding of the underlying results and trends of the ongoing business due to the uniqueness of t
Slide 24: Cirrus Logic
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