Silicon Labs Announces Record IoT Revenue for Fourth Quarter 2021

IoT Leader Enters 2022 With Strong Momentum Across Wireless Portfolio

AUSTIN, Texas, Feb. 2, 2022 — (PRNewswire) — Silicon Labs (NASDAQ: SLAB), a leader in secure, intelligent wireless technology for a more connected world, reported strong financial results for the fourth quarter, which ended January 1, 2022. Revenue exceeded the top of the guidance range at $209 million, up 13% sequentially and 43% year-on-year. Fourth quarter and annual results herein are from "continuing operations" unless explicitly stated.

"I'm proud of the team's disciplined execution as we transitioned to focus solely on the Internet of Things. We delivered record IoT revenue and gained momentum across our entire wireless portfolio," said Matt Johnson, President, and Chief Executive Officer. "We're well-positioned to take advantage of the accelerating IoT growth across smart home, medical, industrial, and commercial segments in 2022."

Fourth Quarter Financial Highlights

Revenue increased to $209 million, up 13% sequentially and 43% year-on-year

Results on a GAAP basis:

GAAP gross margin was 61.3%
GAAP R&D expenses were $72 million
GAAP SG&A expenses were $53 million
GAAP operating income as a percentage of revenue was 1.3%
GAAP diluted earnings per share were $0.13

Results on a non-GAAP basis, excluding the impact of stock compensation, amortization of acquired intangible assets, restructuring charges, non-cash interest expense and other costs associated with convertible notes, and certain other items as set forth in the reconciliation tables were as follows:

Non-GAAP gross margin was 61.4%
Non-GAAP R&D expenses were $57 million
Non-GAAP SG&A expenses were $37 million
Non-GAAP operating income as a percentage of revenue was 16.3%
Non-GAAP diluted earnings per share were $0.77

Business Highlights

In January, Silicon Labs announced the BG24 and MG24 2.4 GHz wireless SoCs and a new software toolkit that bring AI/ML acceleration and wireless high performance to battery-powered edge devices. Matter-ready, the ultra-low-power BG24 and MG24 families support multiple wireless protocols and incorporate PSA Level 3 Secure Vault™ protection, important for diverse smart home, medical and industrial applications.
In Q4, Silicon Labs launched our new Z-Wave 800 SoCs and modules for the Z-Wave smart home and automation ecosystem. This expansion on the company's award-winning Series 2 platform provides developers with sub-GHz connectivity for Z-Wave Mesh and Z-Wave Long Range, which is ideal for the smart home as well as multi-dwelling units, hospitality, and lighting applications while supporting both devices and gateways.
Silicon Labs is proud to be named the Global Semiconductor Alliance's Most Respected Public Semiconductor Company among our peers, a testament to our strong performance and values. We were also ranked one of the best companies to work for in our industry based on the annual Great Place to Work survey of our employees.
On January 27, 2022, Silicon Labs' board of directors approved a new share repurchase program that authorizes the company to buy back up to $250 million of the company's common stock through the end of the fiscal year.
Silicon Labs announced that Sherri Luther, Chief Financial Officer of Lattice Semiconductor (NASDAQ: LSCC), joined Silicon Labs' board of directors effective January 2, 2022. Sherri is a well-respected industry leader, bringing 30 years of experience in mergers and acquisitions, global supply chain optimization, and deep financial expertise. Additionally, Sumit Sadana was appointed Lead Director for Silicon Labs. Sumit succeeds Bill Wood, who remains a member of the board. Sumit currently serves as Executive Vice President, Chief Business Officer, and interim Chief Financial Officer at Micron Technology (NASDAQ: MU).

Business Outlook

The company expects first quarter revenue to be in the range of $220 to $230 million. The company also estimates the following results:

On a GAAP basis:

GAAP gross margin of approximately 63%
GAAP operating expenses of approximately $128 million
GAAP effective tax rate of approximately 37%
GAAP diluted earnings per share to be between $0.15 to $0.25

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 63%
Non-GAAP operating expenses of approximately $105 million
Non-GAAP effective tax rate of approximately 30%
Non-GAAP diluted earnings per share between $0.58 to $0.68

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 March 2, 2022, online or by calling (877) 344-7529 (US) or (412) 317-0088 (international) and entering access code 4909009.

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

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