Record Revenue in Timing and Broadcast Video Product Lines
AUSTIN, Texas--(BUSINESS WIRE)--
Silicon
Labs (NASDAQ: SLAB), a leader in high-performance, analog-intensive,
mixed-signal integrated circuits (ICs), today reported results for its
second quarter ended June 29, 2013. Overall revenue in the second
quarter was $141.5 million, an increase of 4.3 percent compared with the
same period a year ago and down 2.6 percent sequentially.
Financial Highlights
On a GAAP basis, gross margins were 62.7 percent, a sequential
improvement resulting from a shift in the product mix favoring timing
devices. GAAP R&D investment was stable on a sequential basis and
increased year over year to $37.4 million. GAAP SG&A expenses increased
both sequentially and year over year to $32.4 million. Resulting GAAP
operating income as a percentage of revenue decreased sequentially and
increased year over year to 13.4 percent. GAAP diluted earnings per
share were $0.29, down 37 percent sequentially due primarily to
acquisition-related items and income taxes and also down 38 percent year
over year.
The non-GAAP results exclude the impact of stock compensation and
certain other items as set forth in the reconciliation table below.
Non-GAAP gross margins increased sequentially to 62.9 percent. On a
non-GAAP basis, R&D increased slightly to $33.6 million, and SG&A
decreased to $27.3 million. Non-GAAP operating income in the quarter was
19.9 percent. Non-GAAP diluted earnings per share in the quarter were
$0.50, down slightly compared with the second quarter of 2012.
Business Highlights
On July 1, the company closed its acquisition of Energy Micro, a leader
in energy-friendly ARM® Cortex™-M based microcontrollers (MCUs) and
radios. Adding to Silicon Labs' already strong MCU, radio and software
solutions, this strategic acquisition accelerates growth opportunities
and positions the company as the foremost innovator in embedded
solutions for the growing Internet of Things and green energy markets.
In the Broad-based business, revenue and gross margin results were
particularly strong from timing devices. The recently introduced Si50x
CMEMS® oscillator product family, featuring the industry's first
single-die MEMS oscillator solution and designed to replace crystal
oscillators in high-volume applications, is expected to begin generating
significant revenue in 2014.
Although revenue from Broadcast products overall was slightly down
sequentially, the company achieved record revenue in video products
during the second quarter, marking the fourth consecutive quarter of
video revenue growth.
"During the quarter, we achieved two important milestones—the strategic
acquisition of Energy Micro and the groundbreaking introduction of our
new CMEMS technology platform and oscillator product line," said Tyson
Tuttle, CEO of Silicon Labs. "We believe these accomplishments will help
drive Silicon Labs' growth in our Broad-based products, which represent
our fastest growing and largest market opportunity."
The company expects revenue for the third quarter to be in the range of
$144 to $149 million.
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 simultaneously on Silicon Labs' website under Investor
Relations (www.silabs.com).
A replay will be available after the call at the same website listed
above or by calling 1 (855) 859-2056 or 1 (404) 537-3406 (international)
and by entering 39717385. The replay will be available through Aug. 25.
About Silicon Labs
Silicon Labs is an industry leader in the innovation of
high-performance, analog-intensive, mixed-signal ICs. Developed by a
world-class engineering team with unsurpassed expertise in mixed-signal
design, Silicon Labs' diverse portfolio of patented semiconductor
solutions offers customers significant advantages in performance, size
and power consumption. For more information about Silicon Labs, please
visit www.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 our distributors, manufacturers and subcontractors;
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 our 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; 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 and the Silicon
Labs logo are trademarks of Silicon Laboratories Inc. All other product
names noted herein may be trademarks of their respective holders.
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Silicon Laboratories Inc.
|
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Condensed Consolidated Statements of Income
|
|
(In thousands, except per share data)
|
|
(Unaudited)
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Six Months Ended
|
|
|
|
|
June 29,
2013
|
|
June 30,
2012
|
|
|
June 29,
2013
|
|
June 30,
2012
|
|
Revenues
|
|
|
$
|
141,543
|
|
|
$
|
135,670
|
|
|
|
$
|
286,918
|
|
|
$
|
261,372
|
|
|
Cost of revenues
|
|
|
|
52,770
|
|
|
|
52,868
|
|
|
|
|
110,773
|
|
|
|
103,474
|
|
|
Gross margin
|
|
|
|
88,773
|
|
|
|
82,802
|
|
|
|
|
176,145
|
|
|
|
157,898
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
Research and development
|
|
|
|
37,387
|
|
|
|
34,245
|
|
|
|
|
74,969
|
|
|
|
67,175
|
|
|
Selling, general and administrative
|
|
|
|
32,357
|
|
|
|
32,178
|
|
|
|
|
61,510
|
|
|
|
57,580
|
|
|
Operating expenses
|
|
|
|
69,744
|
|
|
|
66,423
|
|
|
|
|
136,479
|
|
|
|
124,755
|
|
|
Operating income
|
|
|
|
19,029
|
|
|
|
16,379
|
|
|
|
|
39,666
|
|
|
|
33,143
|
|
|
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
|
152
|
|
|
|
363
|
|
|
|
|
487
|
|
|
|
860
|
|
|
Interest expense
|
|
|
|
(831
|
)
|
|
|
(32
|
)
|
|
|
|
(1,673
|
)
|
|
|
(65
|
)
|
|
Other income (expense), net
|
|
|
|
114
|
|
|
|
1,079
|
|
|
|
|
62
|
|
|
|
968
|
|
|
Income before income taxes
|
|
|
|
18,464
|
|
|
|
17,789
|
|
|
|
|
38,542
|
|
|
|
34,906
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|
|
Provision (benefit) for income taxes
|
|
|
|
5,852
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|
|
|
(2,720
|
)
|
|
|
|
5,896
|
|
|
|
77
|
|
|
Net income
|
|
|
$
|
12,612
|
|
|
$
|
20,509
|
|
|
|
$
|
32,646
|
|
|
$
|
34,829
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share:
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
$
|
0.30
|
|
|
$
|
0.48
|
|
|
|
$
|
0.77
|
|
|
$
|
0.82
|
|
|
Diluted
|
|
|
$
|
0.29
|
|
|
$
|
0.47
|
|
|
|
$
|
0.76
|
|
|
$
|
0.80
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
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|
|
Basic
|
|
|
|
42,552
|
|
|
|
42,655
|
|
|
|
|
42,370
|
|
|
|
42,556
|
|
|
Diluted
|
|
|
|
43,269
|
|
|
|
43,423
|
|
|
|
|
43,191
|
|
|
|
43,637
|
|
|
|
|
|
|
Unaudited Reconciliation of GAAP to Non-GAAP Financial Measures
|
|
(In thousands, except per share data)
|
|
|
|
|
|
|
|
Non-GAAP Income
|
|
Three Months Ended
|
|
Statement Items
|
|
June 29, 2013
|
|
|
|
GAAP
Measure
|
|
GAAP
Percent of Revenue
|
|
Stock
Compensation Expense
|
|
Termination Costs
|
|
Acquisition Related Items
|
|
Non-GAAP
Measure
|
|
Non-GAAP
Percent of Revenue
|
|
Revenues
|
|
$
|
141,543
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross margin
|
|
|
88,773
|
|
|
62.7
|
%
|
|
$
|
263
|
|
$
|
--
|
|
$
|
--
|
|
$
|
89,036
|
|
62.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development
|
|
|
37,387
|
|
|
26.4
|
%
|
|
|
3,483
|
|
|
315
|
|
|
--
|
|
|
33,589
|
|
23.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative
|
|
|
32,357
|
|
|
22.9
|
%
|
|
|
3,678
|
|
|
480
|
|
|
920
|
|
|
27,279
|
|
19.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
19,029
|
|
|
13.4
|
%
|
|
|
7,424
|
|
|
795
|
|
|
920
|
|
|
28,168
|
|
19.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Diluted
|
|
Three Months Ended
|
|
|
|
Earnings Per Share
|
|
June 29, 2013
|
|
|
|
|
|
|
|
GAAP
Measure
|
|
Stock
Compensation Expense
|
|
Termination Costs
|
|
Acquisition Related Items
|
|
Non-GAAP
Measure
|
|
|
|
Net income
|
|
$
|
12,612
|
|
|
$
|
7,254
|
|
$
|
715
|
|
$
|
920
|
|
$
|
21,501
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted shares outstanding
|
|
|
43,269
|
|
|
|
--
|
|
|
--
|
|
|
--
|
|
|
43,269
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share
|
|
$
|
0.29
|
|
|
|
|
|
|
|
|
$
|
0.50
|
|
|
|
|
|
|
|
Silicon Laboratories Inc.
|
|
Condensed Consolidated Balance Sheets
|
|
(In thousands, except per share data)
|
|
(Unaudited)
|
|
|
|
|
|
|
June 29,
2013
|
|
December 29,
2012
|
|
Assets
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
$
|
193,468
|
|
|
$
|
105,426
|
|
|
Short-term investments
|
|
|
|
151,423
|
|
|
|
176,565
|
|
|
Accounts receivable, net of allowances for doubtful accounts of
$720 at June 29, 2013 and $670 at December 29, 2012
|
|
|
|
68,635
|
|
|
|
78,023
|
|
|
Inventories
|
|
|
|
50,659
|
|
|
|
49,579
|
|
|
Deferred income taxes
|
|
|
|
16,387
|
|
|
|
16,652
|
|
|
Prepaid expenses and other current assets
|
|
|
|
46,356
|
|
|
|
41,437
|
|
|
Total current assets
|
|
|
|
526,928
|
|
|
|
467,682
|
|
|
Long-term investments
|
|
|
|
10,197
|
|
|
|
11,369
|
|
|
Property and equipment, net
|
|
|
|
135,006
|
|
|
|
135,271
|
|
|
Goodwill
|
|
|
|
130,265
|
|
|
|
130,265
|
|
|
Other intangible assets, net
|
|
|
|
85,115
|
|
|
|
90,750
|
|
|
Other assets, net
|
|
|
|
25,510
|
|
|
|
36,629
|
|
|
Total assets
|
|
|
$
|
913,021
|
|
|
$
|
871,966
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders' Equity
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
Accounts payable
|
|
|
$
|
25,952
|
|
|
$
|
29,622
|
|
|
Current portion of long-term debt
|
|
|
|
5,000
|
|
|
|
5,000
|
|
|
Accrued expenses
|
|
|
|
36,012
|
|
|
|
40,410
|
|
|
Deferred income on shipments to distributors
|
|
|
|
30,552
|
|
|
|
30,259
|
|
|
Income taxes
|
|
|
|
926
|
|
|
|
1,087
|
|
|
Total current liabilities
|
|
|
|
98,442
|
|
|
|
106,378
|
|
|
Long-term debt
|
|
|
|
91,250
|
|
|
|
95,000
|
|
|
Other non-current liabilities
|
|
|
|
17,978
|
|
|
|
20,615
|
|
|
Total liabilities
|
|
|
|
207,670
|
|
|
|
221,993
|
|
|
Commitments and contingencies
|
|
|
|
|
|
|
Stockholders' equity:
|
|
|
|
|
|
|
Preferred stock--$0.0001 par value; 10,000 shares authorized; no
shares issued and outstanding
|
|
|
|
--
|
|
|
|
--
|
|
|
Common stock--$0.0001 par value; 250,000 shares authorized;
42,668 and 41,879 shares issued and outstanding at
June 29, 2013 and December 29, 2012, respectively
|
|
|
|
4
|
|
|
|
4
|
|
|
Additional paid-in capital
|
|
|
|
32,837
|
|
|
|
10,122
|
|
|
Retained earnings
|
|
|
|
673,439
|
|
|
|
640,793
|
|
|
Accumulated other comprehensive loss
|
|
|
|
(929
|
)
|
|
|
(946
|
)
|
|
Total stockholders' equity
|
|
|
|
705,351
|
|
|
|
649,973
|
|
|
Total liabilities and stockholders' equity
|
|
|
$
|
913,021
|
|
|
$
|
871,966
|
|
|
|
|
|
|
Silicon Laboratories Inc.
|
|
Condensed Consolidated Statements of Cash Flows
|
|
(In thousands)
|
|
(Unaudited)
|
|
|
|
|
|
|
Six Months Ended
|
|
|
|
|
June 29,
2013
|
|
June 30,
2012
|
|
Operating Activities
|
|
|
|
|
|
|
Net income
|
|
|
$
|
32,646
|
|
|
$
|
34,829
|
|
|
Adjustments to reconcile net income to cash provided by operating
activities:
|
|
|
|
|
|
|
Depreciation of property and equipment
|
|
|
|
6,634
|
|
|
|
6,749
|
|
|
Amortization of other intangible assets and other assets
|
|
|
|
5,635
|
|
|
|
4,559
|
|
|
Stock-based compensation expense
|
|
|
|
13,684
|
|
|
|
15,865
|
|
|
Income tax benefit (detriment) from employee stock-based awards
|
|
|
|
(489
|
)
|
|
|
2,627
|
|
|
Excess income tax benefit from employee stock-based awards
|
|
|
|
(243
|
)
|
|
|
(2,450
|
)
|
|
Deferred income taxes
|
|
|
|
9,277
|
|
|
|
1,625
|
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
Accounts receivable
|
|
|
|
9,388
|
|
|
|
(17,315
|
)
|
|
Inventories
|
|
|
|
(1,028
|
)
|
|
|
(1,299
|
)
|
|
Prepaid expenses and other assets
|
|
|
|
5,023
|
|
|
|
4,806
|
|
|
Accounts payable
|
|
|
|
(2,271
|
)
|
|
|
8,766
|
|
|
Accrued expenses
|
|
|
|
(6,013
|
)
|
|
|
(5,203
|
)
|
|
Deferred income on shipments to distributors
|
|
|
|
293
|
|
|
|
1,372
|
|
|
Income taxes
|
|
|
|
(6,439
|
)
|
|
|
(13,672
|
)
|
|
Net cash provided by operating activities
|
|
|
|
66,097
|
|
|
|
41,259
|
|
|
|
|
|
|
|
|
|
Investing Activities
|
|
|
|
|
|
|
Purchases of available-for-sale investments
|
|
|
|
(121,994
|
)
|
|
|
(105,169
|
)
|
|
Proceeds from sales and maturities of available-for-sale investments
|
|
|
|
146,870
|
|
|
|
186,514
|
|
|
Purchases of property and equipment
|
|
|
|
(6,498
|
)
|
|
|
(5,095
|
)
|
|
Purchases of other assets
|
|
|
|
(2,438
|
)
|
|
|
(7,919
|
)
|
|
Net cash provided by investing activities
|
|
|
|
15,940
|
|
|
|
68,331
|
|
|
|
|
|
|
|
|
|
Financing Activities
|
|
|
|
|
|
|
Proceeds from issuance of common stock, net of shares withheld for
taxes
|
|
|
|
9,512
|
|
|
|
2,922
|
|
|
Excess income tax benefit from employee stock-based awards
|
|
|
|
243
|
|
|
|
2,450
|
|
|
Repurchases of common stock
|
|
|
|
--
|
|
|
|
(36,173
|
)
|
|
Payments on debt
|
|
|
|
(3,750
|
)
|
|
|
--
|
|
|
Net cash provided by (used) in financing activities
|
|
|
|
6,005
|
|
|
|
(30,801
|
)
|
|
|
|
|
|
|
|
|
Increase in cash and cash equivalents
|
|
|
|
88,042
|
|
|
|
78,789
|
|
|
Cash and cash equivalents at beginning of period
|
|
|
|
105,426
|
|
|
|
94,964
|
|
|
Cash and cash equivalents at end of period
|
|
|
$
|
193,468
|
|
|
$
|
173,753
|
|
Silicon Labs
Deborah Stapleton, +1-650-470-4200
Deborah.Stapleton@silabs.com
Source: Silicon Labs
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