Cirrus Logic Reports Fiscal Second Quarter Revenue of $481.1 Million

About this update from Cirrus Logic, Inc.

AUSTIN, Texas --(BUSINESS WIRE)-- Cirrus Logic, Inc. (NASDAQ: CRUS) today posted on its website at investor.cirrus.com the quarterly Shareholder Letter that contains the complete financial results for the second quarter fiscal year 2024, which ended September 23, 2023 , as well as the company’s current business outlook. “Cirrus Logic delivered revenue near the top end of guidance in the September quarter,” said John Forsyth , Cirrus Logic president and chief executive officer. “We also continued our strong track record of engineering execution, ramping shipments of our new camera controller and passing key milestones in the development of the next-generation components that we expect to introduce next year. Looking forward, we remain focused on delivering innovative products that will expand our market reach and enable us to capitalize on the growth opportunities that we see ahead of us.” Reported Financial Results – Second Quarter FY24 Revenue of $481.1 million ; GAAP and non-GAAP gross margin of 51.3 percent; GAAP operating expenses of $140.8 million and non-GAAP operating expenses of $114.4 million ; and GAAP earnings per share of $1.34 and non-GAAP earnings per share of $1.80 . A reconciliation of GAAP to non-GAAP financial information is included in the tables accompanying this press release. Business Outlook – Third Quarter FY24 Revenue is expected to range between $510 million and $570 million ; GAAP gross margin is expected to be between 49 percent and 51 percent; Combined GAAP R&D and SG&A expenses are anticipated to range between $145 million and $151 million , including approximately $23 million in stock-based compensation expense and $2 million in amortization of acquisition intangibles, resulting in a non-GAAP operating expense range between $120 million and $126 million ; and The December quarter will span 14 weeks instead of the typical 13 weeks as FY24 is a 53-week year. Cirrus Logic will host a live Q&A session at 6 p.m. EDT today to discuss its financial results and business outlook. Participants may listen to the conference call on the investor relations website at investor.cirrus.com . A replay of the webcast can be accessed on the Cirrus Logic website approximately two hours following its completion or by calling (647) 362-9199, or toll-free at (800) 770-2030 (Access Code: 95424). About Cirrus Logic, Inc. Cirrus Logic is a leader in low-power, high-precision mixed-signal processing solutions that create innovative user experiences for the world’s top mobile and consumer applications. With headquarters in Austin, Texas , Cirrus Logic is recognized globally for its award-winning corporate culture. Cirrus Logic , Cirrus and the Cirrus Logic logo are registered trademarks of Cirrus Logic, Inc. All other company or product names noted herein may be trademarks of their respective holders. Use of non-GAAP Financial Information To supplement Cirrus Logic's financial statements presented on a GAAP basis, the company has provided non-GAAP financial information, including non-GAAP net income, diluted earnings per share, operating income and profit, operating expenses, gross margin and profit, tax expense, tax expense impact on earnings per share, effective tax rate, free cash flow, and free cash flow margin. A reconciliation of the adjustments to GAAP results is included in the tables below. Non-GAAP financial information is not meant as a substitute for GAAP results but is included because management believes such information is useful to our investors for informational and comparative purposes. In addition, certain non-GAAP financial information is used internally by management to evaluate and manage the company. The non-GAAP financial information used by Cirrus Logic may differ from that used by other companies. These non-GAAP measures should be considered in addition to, and not as a substitute for, the results prepared in accordance with GAAP. Safe Harbor Statement Except for historical information contained herein, the matters set forth in this news release contain forward-looking statements including our statements about our expectation that our next-generation components will be introduced next year; our ability to deliver innovative products that will expand our market reach and enable us to capitalize on the growth opportunities; and our estimates for the third quarter fiscal year 2024 revenue, gross margin, combined research and development and selling, general and administrative expense levels, stock compensation expense, and amortization of acquisition intangibles. In some cases, forward-looking statements are identified by words such as “expect,” “anticipate,” “target,” “project,” “believe,” “goals,” “opportunity,” “estimates,” “intend,” and variations of these types of words and similar expressions. In addition, any statements that refer to our plans, expectations, strategies, or other characterizations of future events or circumstances are forward-looking statements. These forward-looking statements are based on our current expectations, estimates, and assumptions and are subject to certain risks and uncertainties that could cause actual results to differ materially, and readers should not place undue reliance on such statements. These risks and uncertainties include, but are not limited to, the following: our ability to develop and ramp new products in a timely manner, including our next-generation boosted amplifier and our first 22-nm smart codec; our ability to commercialize new research and development efforts into new markets outside of smartphones; and the level and timing of orders and shipments during the third quarter of fiscal year 2024, customer cancellations of orders, or the failure to place orders consistent with forecasts, along with the risk factors listed in our Form 10-K for the year ended March 25, 2023 and in our other filings with the Securities and Exchange Commission , which are available at www.sec.gov . The foregoing information concerning our business outlook represents our outlook as of the date of this news release, and we expressly disclaim any obligation to update or revise any forward-looking statements, whether as a result of new developments or otherwise. Summary Financial Data Follows: CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS (in thousands, except per share data; unaudited) Three Months Ended Six Months Ended Sep. 23 , Jun. 24 , Sep. 24 , Sep. 23 , Sep. 24 , 2023 2023 2022 2023 2022 Q2'24 Q1'24 Q2'23 Q2'24 Q2'23 Audio $ 282,855 $ 195,806 $ 337,811 $ 478,661 $ 592,307 High-Performance Mixed-Signal 198,208 121,210 202,763 319,418 341,906 Net sales 481,063 317,016 540,574 798,079 934,213 Cost of sales 234,467 157,629 269,288 392,096 460,293 Gross profit 246,596 159,387 271,286 405,983 473,920 Gross margin 51.3 % 50.3 % 50.2 % 50.9 % 50.7 % Research and development 104,205 106,215 115,471 210,420 225,187 Selling, general and administrative 34,323 35,379 39,598 69,702 78,240 Restructuring and related costs 2,319 — — 2,319 — Total operating expenses 140,847 141,594 155,069 282,441 303,427 Income from operations 105,749 17,793 116,217 123,542 170,493 Interest income (expense) 3,729 4,600 1,285 8,329 1,590 Other income (expense) (70 ) 377 295 307 801 Income before income taxes 109,408 22,770 117,797 132,178 172,884 Provision for income taxes 34,001 7,170 30,609 41,171 45,989 Net income $ 75,407 $ 15,600 $ 87,188 $ 91,007 $ 126,895 Basic earnings per share $ 1.38 $ 0.28 $ 1.56 $ 1.66 $ 2.27 Diluted earnings per share: $ 1.34 $ 0.28 $ 1.52 $ 1.61 $ 2.20 Weighted average number of shares: Basic 54,503 54,862 55,726 54,683 56,002 Diluted 56,278 56,631 57,418 56,453 57,620 Prepared in accordance with Generally Accepted Accounting Principles RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL INFORMATION (in thousands, except per share data; unaudited) (not prepared in accordance with GAAP) Non-GAAP financial information is not meant as a substitute for GAAP results, but is included because management believes such information is useful to our investors for informational and comparative purposes. In addition, certain non-GAAP financial information is used internally by management to evaluate and manage the company. As a note, the non-GAAP financial information used by Cirrus Logic may differ from that used by other companies. These non-GAAP measures should be considered in addition to, and not as a substitute for, the results prepared in accordance with GAAP. Three Months Ended Six Months Ended Sep. 23 , Jun. 24 , Sep. 24 , Sep. 23 , Sep. 24 , 2023 2023 2022 2023 2022 Net Income Reconciliation Q2'24 Q1'24 Q2'23 Q2'24 Q2'23 GAAP Net Income $ 75,407 $ 15,600 $ 87,188 $ 91,007 $ 126,895 Amortization of acquisition intangibles 2,170 2,170 7,787 4,340 15,622 Stock-based compensation expense 21,331 22,715 20,483 44,046 38,621 Restructuring and related costs 2,319 — — 2,319 — Acquisition-related costs 939 3,166 3,164 4,105 6,328 Adjustment to income taxes (604 ) (5,628 ) (4,135 ) (6,232 ) (8,435 ) Non-GAAP Net Income $ 101,562 $ 38,023 $ 114,487 $ 139,585 $ 179,031 Earnings Per Share Reconciliation GAAP Diluted earnings per share $ 1.34 $ 0.28 $ 1.52 $ 1.61 $ 2.20 Effect of Amortization of acquisition intangibles 0.04 0.04 0.14 0.08 0.27 Effect of Stock-based compensation expense 0.38 0.40 0.35 0.78 0.67 Effect of Restructuring and related costs 0.04 — — 0.04 — Effect of Acquisition-related costs 0.01 0.05 0.05 0.07 0.11 Effect of Adjustment to income taxes (0.01 ) (0.10 ) (0.07 ) (0.11 ) (0.14 ) Non-GAAP Diluted earnings per share $ 1.80 $ 0.67 $ 1.99 $ 2.47 $ 3.11 Operating Income Reconciliation GAAP Operating Income $ 105,749 $ 17,793 $ 116,217 $ 123,542 $ 170,493 GAAP Operating Profit 22.0 % 5.6 % 21.5 % 15.5 % 18.2 % Amortization of acquisition intangibles 2,170 2,170 7,787 4,340 15,622 Stock-based compensation expense - COGS 361 285 312 646 589 Stock-based compensation expense - R&D 15,472 15,952 14,228 31,424 26,820 Stock-based compensation expense - SG&A 5,498 6,478 5,943 11,976 11,212 Restructuring and related costs 2,319 — — 2,319 — Acquisition-related costs 939 3,166 3,164 4,105 6,328 Non-GAAP Operating Income $ 132,508 $ 45,844 $ 147,651 $ 178,352 $ 231,064 Non-GAAP Operating Profit 27.5 % 14.5 % 27.3 % 22.3 % 24.7 % Operating Expense Reconciliation GAAP Operating Expenses $ 140,847 $ 141,594 $ 155,069 $ 282,441 $ 303,427 Amortization of acquisition intangibles (2,170 ) (2,170 ) (7,787 ) (4,340 ) (15,622 ) Stock-based compensation expense - R&D (15,472 ) (15,952 ) (14,228 ) (31,424 ) (26,820 ) Stock-based compensation expense - SG&A (5,498 ) (6,478 ) (5,943 ) (11,976 ) (11,212 ) Restructuring and related costs (2,319 ) — — (2,319 ) — Acquisition-related costs (939 ) (3,166 ) (3,164 ) (4,105 ) (6,328 ) Non-GAAP Operating Expenses $ 114,449 $ 113,828 $ 123,947 $ 228,277 $ 243,445 Gross Margin/Profit Reconciliation GAAP Gross Profit $ 246,596 $ 159,387 $ 271,286 $ 405,983 $ 473,920 GAAP Gross Margin 51.3 % 50.3 % 50.2 % 50.9 % 50.7 % Stock-based compensation expense - COGS 361 285 312 646 589 Non-GAAP Gross Profit $ 246,957 $ 159,672 $ 271,598 $ 406,629 $ 474,509 Non-GAAP Gross Margin 51.3 % 50.4 % 50.2 % 51.0 % 50.8 % Three Months Ended Six Months Ended Sep. 23 , Jun. 24 , Sep. 24 , Sep. 23 , Sep. 24 , 2023 2023 2022 2023 2022 Effective Tax Rate Reconciliation Q2'24 Q1'24 Q2'23 Q2'24 Q2'23 GAAP Tax Expense $ 34,001 $ 7,170 $ 30,609 $ 41,171 $ 45,989 GAAP Effective Tax Rate 31.1 % 31.5 % 26.0 % 31.1 % 26.6 % Adjustments to income taxes 604 5,628 4,135 6,232 8,435 Non-GAAP Tax Expense $ 34,605 $ 12,798 $ 34,744 $ 47,403 $ 54,424 Non-GAAP Effective Tax Rate 25.4 % 25.2 % 23.3 % 25.4 % 23.3 % Tax Impact to EPS Reconciliation GAAP Tax Expense $ 0.60 $ 0.13 $ 0.53 $ 0.73 $ 0.80 Adjustments to income taxes 0.01 0.10 0.07 0.11 0.14 Non-GAAP Tax Expense $ 0.61 $ 0.23 $ 0.60 $ 0.84 $ 0.94 CONSOLIDATED CONDENSED BALANCE SHEET (in thousands; unaudited) Sep. 23 , Mar. 25 , Sep. 24 , 2023 2023 2022 ASSETS Current assets Cash and cash equivalents $ 277,805 $ 445,784 $ 355,043 Marketable securities 34,636 34,978 23,869 Accounts receivable, net 271,894 150,473 304,546 Inventories 328,930 233,450 164,571 Prepaid wafers 79,468 60,638 — Other current assets 104,138 92,533 108,538 Total current Assets 1,096,871 1,017,856 956,567 Long-term marketable securities 40,042 36,509 49,013 Right-of-use lease assets 144,104 128,145 162,859 Property and equipment, net 171,047 162,972 158,722 Intangibles, net 33,801 38,876 141,909 Goodwill 435,936 435,936 435,936 Deferred tax asset 44,126 35,580 13,094 Long-term prepaid wafers 94,474 134,363 174,787 Other assets 44,052 73,729 71,180 Total assets $ 2,104,453 $ 2,063,966 $ 2,164,067 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable $ 87,340 $ 81,462 $ 118,000 Accrued salaries and benefits 46,504 50,606 59,140 Lease liability 19,859 18,442 13,583 Acquisition-related liabilities — 21,361 45,984 Other accrued liabilities 47,487 44,469 45,658 Total current liabilities 201,190 216,340 282,365 Non-current lease liability 136,042 122,631 152,294 Non-current income taxes 51,589 59,013 65,255 Other long-term liabilities 7,277 7,700 9,539 Total long-term liabilities 194,908 189,344 227,088 Stockholders' equity: Capital stock 1,712,710 1,670,141 1,618,177 Accumulated earnings (deficit) (1,213 ) (9,320 ) 40,927 Accumulated other comprehensive loss (3,142 ) (2,539 ) (4,490 ) Total stockholders' equity 1,708,355 1,658,282 1,654,614 Total liabilities and stockholders' equity $ 2,104,453 $ 2,063,966 $ 2,164,067 Prepared in accordance with Generally Accepted Accounting Principles CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS (in thousands; unaudited) Three Months Ended Sep. 23 , Sep. 24 , 2023 2022 Q2'24 Q2'23 Cash flows from operating activities: Net income $ 75,407 $ 87,188 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Depreciation and amortization 11,610 17,219 Stock-based compensation expense 21,331 20,483 Deferred income taxes 810 1,404 Loss on retirement or write-off of long-lived assets 58 11 Other non-cash charges 274 86 Restructuring and related costs 2,319 — Net change in operating assets and liabilities: Accounts receivable, net (86,046 ) (98,274 ) Inventories (27,974 ) 9,799 Prepaid wafers 21,058 — Other assets (14,392 ) (2,491 ) Accounts payable and other accrued liabilities 10,200 14,229 Income taxes payable (12,859 ) (16,829 ) Acquisition-related liabilities (24,527 ) 3,164 Net cash provided by (used in) operating activities (22,731 ) 35,989 Cash flows from investing activities: Maturities and sales of available-for-sale marketable securities 7,194 1,961 Purchases of available-for-sale marketable securities (7,819 ) (850 ) Purchases of property, equipment and software (8,470 ) (10,211 ) Investments in technology (57 ) (36 ) Net cash used in investing activities (9,152 ) (9,136 ) Cash flows from financing activities: Issuance of common stock, net of shares withheld for taxes — 1,011 Repurchase of stock to satisfy employee tax withholding obligations (2,082 ) (2,156 ) Repurchase and retirement of common stock (40,576 ) (50,000 ) Net cash used in financing activities (42,658 ) (51,145 ) Net decrease in cash and cash equivalents (74,541 ) (24,292 ) Cash and cash equivalents at beginning of period 352,346 379,335 Cash and cash equivalents at end of period $ 277,805 $ 355,043 Prepared in accordance with Generally Accepted Accounting Principles RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL INFORMATION (in thousands; unaudited) Free cash flow, a non-GAAP financial measure, is GAAP cash flow from operations (or cash provided by operating activities) less capital expenditures. Capital expenditures include purchases of property, equipment and software as well as investments in technology, as presented within our GAAP Consolidated Condensed Statement of Cash Flows. Free cash flow margin represents free cash flow divided by revenue. Twelve Months Ended Three Months Ended Sep. 23 , Sep. 23 , Jun. 24 , Mar. 25 , Dec. 24 , 2023 2023 2023 2023 2022 Q2'24 Q2'24 Q1'24 Q4'23 Q3'23 Net cash provided by (used in) operating activities (GAAP) $ 166,670 $ (22,731 ) $ (39,813 ) $ 48,266 $ 180,948 Capital expenditures (40,080 ) (8,527 ) (12,310 ) (11,635 ) (7,608 ) Free Cash Flow (Non-GAAP) $ 126,590 $ (31,258 ) $ (52,123 ) $ 36,631 $ 173,340 Cash Flow from Operations as a Percentage of Revenue (GAAP) 9 % (5 )% (13 )% 13 % 31 % Capital Expenditures as a Percentage of Revenue (GAAP) 2 % 2 % 4 % 3 % 1 % Free Cash Flow Margin (Non-GAAP) 7 % (6 )% (16 )% 10 % 29 % RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL INFORMATION (in millions; unaudited) (not prepared in accordance with GAAP) Q3'24 Guidance Operating Expense Reconciliation GAAP Operating Expenses $145 - 151 Stock-based compensation expense (23) Amortization of acquisition intangibles (2) Non-GAAP Operating Expenses $120 - 126 View source version on businesswire.com : https://www.businesswire.com/news/home/20231102798810/en/ Investor Contact: Chelsea Heffernan Vice President, Investor Relations Cirrus Logic, Inc. (512) 851-4125 [email protected] Source: Cirrus Logic, Inc.

View stock analysis, news, and events for Cirrus Logic, Inc.