- Record 2018 Revenue -
AUSTIN, Texas, Jan. 30, 2019 — (PRNewswire) — Silicon Labs (NASDAQ: SLAB), a leading provider of silicon, software and solutions for a smarter, more connected world, today reported financial results for its fourth quarter ended December 29, 2018. Revenue in the fourth quarter fell short of the low end of guidance at $215.5 million, down from $230.2 million in the third quarter. Fourth quarter GAAP and non-GAAP diluted earnings per share (EPS) were $0.35 and $0.91, respectively.
"We are proud of our performance in 2018, which was a strong year for Silicon Labs in many dimensions. We completed the successful acquisition of Z-Wave, strengthened our team, and grew our revenue and design wins to record levels," said Tyson Tuttle, CEO of Silicon Labs. "Despite current volatility, we remain confident about our longer-term ability to outperform the market. We are focused on executing on our product roadmaps and converting a large pipeline of opportunities into additional wins and share gains. The technologies we are developing are enabling our customers to transform industries and improve lives."
Fourth Quarter Financial Highlights
- IoT revenue declined to $119 million, down 5% sequentially and up 9% year-on-year.
- Infrastructure revenue declined to $46 million, down 13% sequentially and up 18% year-on-year.
- Broadcast revenue declined to $35 million, down 3% sequentially and 3% year-on-year.
- Access revenue declined to $15 million, down 7% sequentially and 8% year-on-year.
On a GAAP basis:
- GAAP gross margin was 60.4%.
- GAAP R&D expenses were $63 million.
- GAAP SG&A expenses were $49 million.
- GAAP operating income as a percentage of revenue was 8.5%.
- GAAP diluted earnings per share were $0.35.
On a non-GAAP basis, excluding the impact of stock compensation, amortization of acquired intangible assets, non-cash interest expense on convertible notes, and certain other items as set forth in the reconciliation tables below:
- Non-GAAP gross margin was 60.6%.
- Non-GAAP R&D expenses were $49 million.
- Non-GAAP SG&A expenses were $39 million.
- Non-GAAP operating income as a percentage of revenue was 19.6%.
- Non-GAAP diluted earnings per share were $0.91.
Product Results
- Launched the next-generation Z-Wave® 700 on the Wireless Gecko platform, building on Z-Wave's S2 security and interoperability framework, while improving energy efficiency and adding longer range RF capabilities.
- Released new Bluetooth® 5.1 software for the Wireless Gecko platform with a direction finding feature that enables more precise indoor navigation and location services.
- Expanded Silicon Labs' groundbreaking low-power Wi-Fi® portfolio of modules and transceivers designed specifically for the requirements of IoT applications.
- Announced that Xiaomi, a leading IoT ecosystem provider in China, launched new smart lighting products based on Silicon Labs' Wireless Gecko SoCs and Bluetooth mesh software.
- Tuya, a leading artificial intelligence and IoT (AIoT) platform provider in China, announced they are using the Wireless Gecko platform to enable their smart multiprotocol products to easily connect to multi-node mesh networks deployed in smart homes.
- Announced a collaboration with Tile, makers of the world's best-selling Bluetooth location tracker, with Silicon Labs providing enabling software to its partners to support the expansion of Tile's ecosystem.
- Collaborated with Cognosos to create a wireless networking device using Wireless Gecko SoCs to improve the management of automotive asset tracking.
Business Highlights
- Added Christy Wyatt, CEO of Absolute Software Corporation and a thought leader in the cybersecurity industry, to Silicon Labs' board of directors.
- Won the Global Semiconductor Alliance's "Most Respected Public Semiconductor Company" award for the fourth year in a row.
- Honored at the 2018 ASPENCORE World Electronics Achievement Awards (WEAA) in Shenzhen, China; Tyson Tuttle named Executive of the Year, and Wireless Gecko won in the wireless product category.
Business Outlook
In light of macro uncertainty and volatility, the company expects first quarter revenue to be in the range of $183 to $193 million, with IoT, Infrastructure, Broadcast and Access down, and estimates the following:
On a GAAP basis:
- GAAP gross margin at approximately 60.0%.
- GAAP operating expenses at approximately $114.0 million.
- GAAP effective tax rate of 10.0%.
- GAAP diluted loss per share between $(0.11) and $(0.01).
On a non-GAAP basis, and excluding the impact of stock compensation, amortization of acquired intangible assets, non-cash interest expense on convertible notes, and certain other items as set forth in the reconciliation tables below:
- Non-GAAP gross margin at approximately 60.0%.
- Non-GAAP operating expenses at approximately $90.0 million.
- Non-GAAP effective tax rate at 13.0%.
- Non-GAAP diluted earnings per share between $0.42 and $0.52.
Webcast and Conference Call
A conference call discussing the quarterly results will follow this press release at 7:30 a.m. Central time. An audio webcast will be available on Silicon Labs' website ( www.silabs.com) under Investor Relations. A replay will be available after the call at the same website listed above or by calling 1 (877) 344-7529 (US) or (412) 317-0088 (International) and entering access code 10127685. The replay will be available through March 2, 2019.
About Silicon Labs
Silicon Labs (NASDAQ: SLAB) is a leading provider of silicon, software and solutions for a smarter, more connected world. Our award-winning technologies are shaping the future of the Internet of Things, Internet infrastructure, industrial automation, consumer and automotive markets. Our world-class engineering team creates products focused on performance, energy savings, connectivity and simplicity. 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: 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; dependence on a limited number of products and customers; intellectual property litigation risks; risks associated with acquisitions and divestitures; product liability risks; difficulties managing Silicon Labs' distributors, manufacturers and subcontractors; inventory-related risks; difficulties managing international activities; risks associated with international activities (including trade barriers); 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, war and political unrest; 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; conflict mineral risks and other factors that are detailed in the SEC filings of Silicon Laboratories Inc. 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.
CONTACT: Jalene Hoover, +1 (512) 428-1610, Jalene.Hoover@silabs.com
Silicon Laboratories Inc. | |||||||
Condensed Consolidated Statements of Income | |||||||
(In thousands, except per share data) | |||||||
(Unaudited) | |||||||
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| Three Months Ended |
| Year Ended | ||||
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| December 29,
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| December 30,
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| December 29,
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| December 30,
|
Revenues | $215,534 |
| $201,018 |
| $868,267 |
| $768,867 |
Cost of revenues | 85,291 |
| 81,754 |
| 346,868 |
| 314,676 |
Gross margin | 130,243 |
| 119,264 |
| 521,399 |
| 454,191 |
Operating expenses: |
|
|
|
|
|
|
|
Research and development | 62,933 |
| 52,735 |
| 238,347 |
| 209,491 |
Selling, general and administrative | 48,948 |
| 40,139 |
| 197,844 |
| 159,726 |
Operating expenses | 111,881 |
| 92,874 |
| 436,191 |
| 369,217 |
Operating income | 18,362 |
| 26,390 |
| 85,208 |
| 84,974 |
Other income (expense): |
|
|
|
|
|
|
|
Interest income and other, net | (273) |
| 1,963 |
| 6,647 |
| 6,057 |
Interest expense | (4,991) |
| (4,863) |
| (19,694) |
| (14,128) |
Income before income taxes | 13,098 |
| 23,490 |
| 72,161 |
| 76,903 |
Provision (benefit) for income taxes | (2,047) |
| 28,342 |
| (11,430) |
| 29,811 |
Net income (loss) | $ 15,145 |
| $ (4,852) |
| $ 83,591 |
| $ 47,092 |
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Earnings (loss) per share: |
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Basic | $ 0.35 |
| $ (0.11) |
| $ 1.94 |
| $ 1.11 |
Diluted | $ 0.35 |
| $ (0.11) |
| $ 1.90 |
| $ 1.09 |
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Weighted-average common shares outstanding: |
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|
Basic | 43,109 |
| 42,656 |
| 43,159 |
| 42,446 |
Diluted | 43,774 |
| 42,656 |
| 44,044 |
| 43,332 |
Unaudited Reconciliation of GAAP to Non-GAAP Financial Measures | ||||||||||||||
(In thousands, except per share data) | ||||||||||||||
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Non-GAAP Income
|
| Three Months Ended December 29, 2018 |
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|
| GAAP Measure |
| GAAP
|
| Stock
|
| Intangible Asset
|
| Non-GAAP
|
| Non-GAAP
|
|
|
Revenues |
| $215,534 |
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Gross margin |
| 130,243 |
| 60.4% |
| $ 323 |
| $ -- |
| $130,566 |
| 60.6% |
|
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Research and development |
| 62,933 |
| 29.2% |
| 6,413 |
| 7,760 |
| 48,760 |
| 22.6% |
|
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Selling, general and administrative |
| 48,948 |
| 22.7% |
| 6,447 |
| 3,020 |
| 39,481 |
| 18.4% |
|
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|
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Operating income |
| 18,362 |
| 8.5% |
| 13,183 |
| 10,780 |
| 42,325 |
| 19.6% |
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Non-GAAP
|
| Three Months Ended December 29, 2018 | ||||||||||||
|
|
| GAAP
|
| Stock
|
| Intangible
|
| Termination Costs
|
| Non-cash
|
| Income Tax
|
| Non-GAAP
|
Net income |
| $15,145 |
| $13,183 |
| $10,780 |
| $2,785 |
| $2,880 |
| $(4,777) |
| $39,996 |
|
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Diluted shares outstanding |
| 43,774 |
|
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| 43,774 |
|
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Diluted earnings per share |
| $ 0.35 |
|
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| $ 0.91 |
|
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* Represents pre-tax amounts |
Unaudited Forward-Looking Statements Regarding Business Outlook | ||||||
(In millions, except per share data) | ||||||
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Business Outlook |
| Three Months Ending
| ||||
|
|
| GAAP
|
| Non-GAAP
|
| Non-GAAP
|
Gross margin |
| 60.0% |
| 0.0% |
| 60.0% |
|
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Operating expenses |
| $114 |
| $24 |
| $90 |
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Effective tax rate |
| 10.0% |
| 3.0% |
| 13.0% |
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Diluted earnings (loss) per share - low |
| $(0.11) |
| $0.53 |
| $0.42 |
|
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Diluted earnings (loss) per share - high |
| $(0.01) |
| $0.53 |
| $0.52 |
|
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Silicon Laboratories Inc. | |||
Condensed Consolidated Balance Sheets | |||
(In thousands, except per share data) | |||
(Unaudited) | |||
|
| |||
|
| December 29,
|
| December 30, 2017 |
Assets |
|
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|
Current assets: |
|
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|
Cash and cash equivalents | $ 197,043 |
| $ 269,366 |
Short-term investments | 416,779 |
| 494,657 |
Accounts receivable, net | 73,194 |
| 71,367 |
Inventories | 74,972 |
| 73,132 |
Prepaid expenses and other current assets | 64,650 |
| 39,120 |
Total current assets | 826,638 |
| 947,642 |
Property and equipment, net | 139,049 |
| 127,682 |
Goodwill | 397,344 |
| 288,227 |
Other intangible assets, net | 170,832 |
| 83,144 |
Other assets, net | 90,491 |
| 88,387 |
Total assets | $1,624,354 |
| $1,535,082 |
|
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Liabilities and Stockholders' Equity |
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Current liabilities: |
|
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Accounts payable | $ 41,171 |
| $ 38,851 |
Deferred revenue and returns liability | 22,494 |
| -- |
Deferred income on shipments to distributors | -- |
| 50,115 |
Other current liabilities | 81,180 |
| 73,359 |
Total current liabilities | 144,845 |
| 162,325 |
Convertible debt | 354,771 |
| 341,879 |
Other non-current liabilities | 57,448 |
| 77,862 |
Total liabilities | 557,064 |
| 582,066 |
Commitments and contingencies |
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Stockholders' equity: |
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Preferred stock – $0.0001 par value; 10,000 shares authorized; no shares issued | -- |
| -- |
Common stock – $0.0001 par value; 250,000 shares authorized; 43,088 and 42,707 shares issued and outstanding at December 29, 2018 and December 30, 2017, respectively | 4 |
| 4 |
Additional paid-in capital | 107,517 |
| 102,862 |
Retained earnings | 961,343 |
| 851,307 |
Accumulated other comprehensive loss | (1,574) |
| (1,157) |
Total stockholders' equity | 1,067,290 |
| 953,016 |
Total liabilities and stockholders' equity | $1,624,354 |
| $1,535,082 |
Silicon Laboratories Inc. | |||
Condensed Consolidated Statements of Cash Flows | |||
(In thousands) | |||
(Unaudited) | |||
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| |||
|
| Year Ended | ||
|
| December 29,
|
| December 30,
|
Operating Activities |
|
|
|
Net income | $ 83,591 |
| $ 47,092 |
Adjustments to reconcile net income to cash provided by
|
|
|
|
Depreciation of property and equipment | 15,912 |
| 14,766 |
Amortization of other intangible assets and other assets | 44,102 |
| 27,246 |
Amortization of debt discount and debt issuance costs | 12,892 |
| 10,146 |
Stock-based compensation expense | 50,077 |
| 44,752 |
Deferred income taxes | (8,210) |
| (26,452) |
Changes in operating assets and liabilities: |
|
|
|
Accounts receivable | 3,931 |
| 3,234 |
Inventories | 7,660 |
| (13,416) |
Prepaid expenses and other assets | (4,960) |
| 25,266 |
Accounts payable | 5,952 |
| (468) |
Other current liabilities and income taxes | (21,828) |
| 61,924 |
Deferred income, deferred revenue and returns liability | (6,202) |
| 4,453 |
Other non-current liabilities | (9,375) |
| (9,022) |
Net cash provided by operating activities | 173,542 |
| 189,521 |
|
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Investing Activities |
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Purchases of available-for-sale investments | (395,904) |
| (636,363) |
Sales and maturities of available-for-sale investments | 474,129 |
| 294,452 |
Purchases of property and equipment | (24,462) |
| (12,252) |
Purchases of other assets | (11,063) |
| (4,960) |
Acquisitions of businesses, net of cash acquired | (239,729) |
| (15,168) |
Net cash used in investing activities | (197,029) |
| (374,291) |
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Financing Activities |
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Proceeds from issuance of long-term debt, net | -- |
| 389,468 |
Payments on debt | -- |
| (72,500) |
Repurchases of common stock | (39,276) |
| -- |
Payment of taxes withheld for vested stock awards | (19,483) |
| (15,753) |
Proceeds from the issuance of common stock | 13,303 |
| 11,815 |
Payment of acquisition-related contingent consideration | (3,380) |
| -- |
Net cash provided by (used in) financing activities | (48,836) |
| 313,030 |
|
|
|
|
|
Increase (decrease) in cash and cash equivalents | (72,323) |
| 128,260 |
Cash and cash equivalents at beginning of period | 269,366 |
| 141,106 |
Cash and cash equivalents at end of period | $197,043 |
| $269,366 |
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SOURCE Silicon Labs
| Contact: |
| Company Name: Silicon Labs
Web: http://www.silabs.com Financial data for Silicon Labs |
