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Exhibit 99
Silicon Labs Announces Record Quarterly Revenue
-- Record IoT Revenue Affirms Pure-Play Focus on Massive IoT Opportunity --
AUSTIN, Texas – April 28, 2021 – Silicon Labs (NASDAQ: SLAB), a leading provider of silicon, software and solutions for a smarter, more connected world, today reported financial results for its first quarter ended April 3, 2021. Revenue exceeded the top end of our initial guidance at $255.5 million, up from $242.9 million in the fourth quarter. First quarter GAAP and non-GAAP diluted earnings per share (EPS) were $0.29 and $0.91, respectively.
“Despite significant supply constraints, strong bookings and durable demand momentum drove first quarter revenue to a new record of $255.5 million led by record revenue in IoT which grew 7% sequentially and 34% year-on-year,” said Tyson Tuttle, CEO of Silicon Labs. “We continue to lead the market in wireless connectivity for a vast array of intelligent solutions. Last week’s announcement to become a pure-play leader of intelligent, wireless connectivity for the IoT coupled with the global economic recovery from the pandemic fuels our excitement to capitalize on the massive growth opportunity in front of us.”
First Quarter Financial Highlights
| • | IoT revenue increased to $158.2 million, up 7% sequentially and 34% year-on-year. |
| • | Infrastructure and Automotive revenue increased to $97.3 million, up 2% sequentially and flat year-on-year. | |
On a GAAP basis:
| • | GAAP gross margin was 58.9%. |
| • | GAAP R&D expenses were $76 million. |
| • | GAAP SG&A expenses were $52 million. |
| • | GAAP operating income as a percentage of revenue was 8.7%. |
| • | GAAP diluted earnings per share was $0.29. |
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 below:
| • | Non-GAAP gross margin was 59.1%. |
| • | Non-GAAP R&D expenses were $61 million. |
| • | Non-GAAP SG&A expenses were $42 million. |
| • | Non-GAAP operating income as a percentage of revenue was 18.7%. | |
| • | Non-GAAP diluted earnings per share were $0.91. |
Product Highlights
| • | Announced the extension of its award-winning xG22 platform with the launch of the EFM32PG22 (PG22), a new low-cost high performance 32-bit microcontrollers (MCUs). The PG22 has an industry-leading combination of energy efficiency, performance and security ideally suited for rapid development of consumer and industrial applications with demanding size constraints and low power operational requirements. The PG22 is targeted at high volume, low-powered applications at a price point competitive with 8-bit offerings and which is form factor & code compatible with its wireless counterparts. |
| • | Introduced new SmartClockTM features to its family of AEC-Q100 qualified Si5332-AM clock generators expanding the capabilities of the industry’s broadest portfolio of silicon-based automotive timing solutions. The new SmartClockTM technology actively monitors reference clocks to detect potential faults and provides built-in clock redundancy. |
| • | Introduced the new Hi823Hx Gate Driver Board, an all-in-one isolation solution perfectly suited for the recently launched Wolfspeed WolfPACK™ power module. Wolfspeed power modules are used across numerous power applications, including EV chargers and motor drives in the industrial and automotive markets. Featuring the Si823Hx isolated gate driver and Si88xx digital isolator with integrated dc-dc converter, the board delivers excellent performance in a compact and cost-effective design, optimized for a wide range of modules. |
Business Highlights
| • | Entered into a definitive asset purchase agreement to sell the Infrastructure & Automotive (I&A) business to Skyworks Solutions, Inc. (NASDAQ: SWKS) for $2.75 billion in all-cash consideration. The transaction includes Silicon Labs’ power/isolation, timing and broadcast products, intellectual property and associated employees. The company’s resulting focus on IoT comes at a time when the overall market and Silicon Labs’ growth opportunities are accelerating, as industry projections anticipate a multi-year ramp in connected devices. | |
| • | Appointed Matt Johnson to president. Johnson previously served as senior vice president and general manager of Silicon Labs’ IoT business unit. | |
| • | Appointed Daniel Cooley to chief technology officer, reporting to Matt Johnson. Cooley previously served as chief strategy officer and replaces Alessandro Piovaccari, who stepped down as chief technology officer but will continue to serve Silicon Labs as a technical advisor. | |
| • | Appointed Dr. Manish Kothari to the IoT leadership team. As vice president of Silicon Labs India, Kothari will grow the wireless engineering talent, build scalable infrastructure, and foster local partnerships in Hyderabad, the company’s newest and fastest-growing wireless development center. | |
| • | Officially became the world's first silicon innovator to achieve PSA Certified's highest level of IoT hardware and software security protection. PSA Certified – a respected security body for IoT hardware, software and devices co-founded by ARM – awarded PSA Certified Level 3 status to Silicon Labs' EFR32MG21, a wireless SoC with Secure Vault. | |
| • | Announced a collaboration with Edge Impulse to enable rapid development and deployment of machine learning (ML) on Silicon Labs EFR32 wireless SoCs and EFM32 MCUs. Implementation of the Edge Impulse tool enables complex motion detection, sound recognition and image classification on low-power, memory-constrained, and remote edge devices. |
| • | Announced a collaboration with Yeelight on a new smart LED light bulb to support Seamless Setup in the Google Home app. The Yeelight Smart LED Bulb M2 multi-color light bulb is designed with Silicon Labs' Bluetooth BG21 SoC, enabling reliable wireless connectivity and allowing users to connect and control smart home devices in the Google Home app without requiring other applications. | |
| • | Collaborated with Allterco Robotics to introduce Shelly Motion, a next-generation motion sensor with unrivaled battery life enabled by Silicon Labs’ Wi-Fi IoT solution. Shelly Motion is the first product to combine Shelly’s innovative home automation sensors with the only industry-leading Wi-Fi solution designed to meet the ultra-low power requirements of IoT sensors. Optimized with Silicon Labs’ Wi-Fi technology, Shelly Motion is the most responsive, energy-efficient, and easy-to-use smart home Wi-Fi motion sensor on the market today. |
Business Outlook
The company expects second quarter revenue to be in the range of $262 to $272 million, with IoT roughly flat to the first quarter, limited by supply, and Infrastructure & Automotive up, and estimates the following:
On a GAAP basis:
| • | GAAP gross margin between 57% and 58% |
| • | GAAP operating expenses at approximately $130 million |
| • | GAAP effective tax rate of 7%. |
| • | GAAP diluted earnings per share between $0.28 and $0.38. |
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 below:
| • | Non-GAAP gross margin between 57% and 58%. |
| • | Non-GAAP operating expenses at approximately $104 million. |
| • | Non-GAAP effective tax rate at 11.5%. |
| • | Non-GAAP diluted earnings per share between $0.88 and $0.98 |
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 10154019. The replay will be available through May 5, 2021.
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: the occurrence of any event, change or other circumstance that could give rise to the termination of the Skyworks asset purchase agreement; the failure to satisfy any of the conditions to the completion of such transaction; the effect of such transaction on the ability of Silicon Labs to retain and hire key personnel and maintain relationships with its customers, suppliers, advertisers, partners and others with whom it does business, or on its operating results and businesses generally; risks associated with the disruption of management’s attention from ongoing business operations due to such transaction; the ability to meet expectations regarding the timing and completion of such transaction, including with respect to receipt of required regulatory approvals; the impact of COVID-19 on the U.S. and global economy, including the restrictions on travel and transportation and other actions taken by governmental authorities and disruptions to the business of our customers or our global supply chain that have occurred or may occur in the future, the ongoing impact of COVID-19 on our employees and our ability to provide services to our customers and respond to their needs; 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; risks associated with international activities (including trade barriers, particularly with respect to China); intellectual property litigation risks; risks associated with acquisitions and divestitures; product liability risks; difficulties managing Silicon Labs’ distributors, manufacturers and subcontractors; dependence on a limited number of products; absence of long-term commitments from customers; 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 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 or pandemics, 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 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: Austin Dean, +1 (512) 532-9432, Austin.Dean@silabs.com
Silicon Laboratories Inc.
Condensed Consolidated Statements of Income
(In thousands, except per share data)
(Unaudited)
| Three Months Ended | ||||||||
| April
3, 2021 | April
4, 2020 | |||||||
| Revenues | $ | 255,505 | $ | 214,877 | ||||
| Cost of revenues | 104,922 | 85,711 | ||||||
| Gross profit | 150,583 | 129,166 | ||||||
| Operating expenses: | ||||||||
| Research and development | 76,474 | 71,223 | ||||||
| Selling, general and administrative | 51,950 | 53,996 | ||||||
| Operating expenses | 128,424 | 125,219 | ||||||
| Operating income | 22,159 | 3,947 | ||||||
| Other income (expense): | ||||||||
| Interest income and other, net | 2,875 | 3,251 | ||||||
| Interest expense | (11,324 | ) | (5,541 | ) | ||||
| Income before income taxes | 13,710 | 1,657 | ||||||
| Provision (benefit) for income taxes | 201 | (587 | ) | |||||
| Net income | $ | 13,509 | $ | 2,244 | ||||
| Earnings per share: | ||||||||
| Basic | $ | 0.31 | $ | 0.05 | ||||
| Diluted | $ | 0.29 | $ | 0.05 | ||||
| Weighted-average common shares outstanding: | ||||||||
| Basic | 44,160 | 43,642 | ||||||
| Diluted | 45,832 | 44,388 | ||||||
Unaudited Reconciliation of GAAP to Non-GAAP Financial Measures
(In thousands, except per share data)
| Three
Months Ended April 3, 2021 | ||||||||||||||||||||||||
| Non-GAAP
Income Statement Items | GAAP Measure | GAAP
Percent of Revenue | Stock
Compensation Expense | Intangible
Asset Amortization | Non-GAAP
Measure | Non-GAAP
Percent of Revenue | ||||||||||||||||||
| Revenues | $ | 255,505 | ||||||||||||||||||||||
| Gross profit | 150,583 | 58.9 | % | $ | 337 | $ | -- | $ | 150,920 | 59.1 | % | |||||||||||||
| Research and development | 76,474 | 29.9 | % | 7,024 | 8,390 | 61,060 | 23.9 | % | ||||||||||||||||
| Selling, general and administrative | 51,950 | 20.3 | % | 6,466 | 3,315 | 42,169 | 16.5 | % | ||||||||||||||||
| Operating income | 22,159 | 8.7 | % | 13,827 | 11,705 | 47,691 | 18.7 | % | ||||||||||||||||
| Three
Months Ended April 3, 2021 | ||||||||||||||||||||||||||||
| Non-GAAP
Earnings Per Share | GAAP
Measure | Stock
Compensation Expense* | Intangible
Asset Amortization* | Investment
Fair Value Adjustments* | Interest
Expense Adjustments* | Income
Tax Adjustments | Non-
GAAP Measure | |||||||||||||||||||||
| Net income | $ | 13,509 | $ | 13,827 | $ | 11,705 | $ | (1,801 | ) | $ | 9,307 | $ | (4,856 | ) | $ | 41,691 | ||||||||||||
Diluted shares outstanding | 45,832 | 45,832 | ||||||||||||||||||||||||||
Diluted earnings per share | $ | 0.29 | $ | 0.91 | ||||||||||||||||||||||||
* Represents pre-tax amounts
Unaudited Forward-Looking Statements Regarding Business Outlook
(In millions, except per share data)
| Three
Months Ending July 3, 2021 | ||||||||||||
| Business Outlook | GAAP
Measure | Non-GAAP
Adjustments* | Non-GAAP
Measure | |||||||||
| Gross margin | 57-58 | % | 0 | % | 57-58 | % | ||||||
| Operating expenses | $ | 130 | $ | 26 | $ | 104 | ||||||
| Effective tax rate | 7 | % | 4.5 | % | 11.5 | % | ||||||
| Diluted earnings per share - low | $ | 0.28 | $ | 0.60 | $ | 0.88 | ||||||
| Diluted earnings per share - high | $ | 0.38 | $ | 0.60 | $ | 0.98 | ||||||
* Non-GAAP adjustments include the following estimates: stock compensation expense of $14 million, intangible asset amortization of $12 million, interest expense adjustments of $5 million, and the associated tax impact from the aforementioned items.
Silicon Laboratories Inc.
Condensed Consolidated Balance Sheets
(In thousands, except per share data)
(Unaudited)
| April 3, 2021 | January 2, 2021 | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 205,224 | $ | 202,720 | ||||
| Short-term investments | 367,708 | 521,963 | ||||||
| Accounts receivable, net | 103,699 | 95,169 | ||||||
| Inventories | 79,244 | 66,662 | ||||||
| Prepaid expenses and other current assets | 105,056 | 89,307 | ||||||
| Total current assets | 860,931 | 975,821 | ||||||
| Property and equipment, net | 141,000 | 139,439 | ||||||
| Goodwill | 631,932 | 631,932 | ||||||
| Other intangible assets, net | 154,379 | 166,084 | ||||||
| Other assets, net | 82,381 | 80,211 | ||||||
| Total assets | $ | 1,870,623 | $ | 1,993,487 | ||||
| Liabilities and Stockholders’ Equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 68,998 | $ | 54,949 | ||||
| Current portion of convertible debt, net | -- | 134,480 | ||||||
| Deferred revenue and returns liability | 13,450 | 12,986 | ||||||
| Other current liabilities | 68,351 | 82,083 | ||||||
| Total current liabilities | 150,799 | 284,498 | ||||||
| Convertible debt, net | 434,288 | 428,945 | ||||||
| Other non-current liabilities | 78,557 | 80,203 | ||||||
| Total liabilities | 663,644 | 793,646 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders’ equity: | ||||||||
| Preferred stock – $0.0001 par value; 10,000 shares authorized; no shares issued | -- | -- | ||||||
Common stock – $0.0001 par value; 250,000 shares authorized; 44,749 and 43,925 shares issued and outstanding at April 3, 2021 and January 2, 2021, respectively | 4 | 4 | ||||||
| Additional paid-in capital | 199,576 | 204,359 | ||||||
| Retained earnings | 1,007,173 | 993,664 | ||||||
| Accumulated other comprehensive income | 226 | 1,814 | ||||||
| Total stockholders' equity | 1,206,979 | 1,199,841 | ||||||
| Total liabilities and stockholders' equity | $ | 1,870,623 | $ | 1,993,487 | ||||
Silicon Laboratories Inc.
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
| Three Months Ended | ||||||||
| April 3, 2021 | April 4, 2020 | |||||||
| Operating Activities | ||||||||
| Net income | $ | 13,509 | $ | 2,244 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
| Depreciation of property and equipment | 4,529 | 4,183 | ||||||
| Amortization of other intangible assets and other assets | 11,705 | 9,827 | ||||||
| Amortization of debt discount and debt issuance costs | 6,456 | 3,736 | ||||||
| Loss on extinguishment of convertible debt | 3,370 | -- | ||||||
| Stock-based compensation expense | 13,826 | 15,313 | ||||||
| Deferred income taxes | (3,197 | ) | (2,364 | ) | ||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | (8,530 | ) | 1,542 | |||||
| Inventories | (12,626 | ) | 4,777 | |||||
| Prepaid expenses and other assets | (13,621 | ) | 23,576 | |||||
| Accounts payable | 14,116 | 2,748 | ||||||
| Other current liabilities and income taxes | (13,429 | ) | (9,134 | ) | ||||
| Deferred revenue and returns liability | 464 | 4,114 | ||||||
| Other non-current liabilities | (2,066 | ) | (862 | ) | ||||
| Net cash provided by operating activities | 14,506 | 59,700 | ||||||
| Investing Activities | ||||||||
| Purchases of available-for-sale investments | (8,251 | ) | (70,910 | ) | ||||
| Sales and maturities of available-for-sale investments | 161,392 | 126,920 | ||||||
| Purchases of property and equipment | (6,176 | ) | (4,135 | ) | ||||
| Purchases of other assets | (578 | ) | (370 | ) | ||||
| Net cash provided by investing activities | 146,387 | 51,505 | ||||||
| Financing Activities | ||||||||
| Proceeds from revolving line of credit | -- | 310,000 | ||||||
| Payments on debt | (140,572 | ) | -- | |||||
| Repurchases of common stock | -- | (16,287 | ) | |||||
| Payment of taxes withheld for vested stock awards | (17,817 | ) | (16,294 | ) | ||||
| Net cash provided by (used in) financing activities | (158,389 | ) | 277,419 | |||||
| Increase in cash and cash equivalents | 2,504 | 388,624 | ||||||
| Cash and cash equivalents at beginning of period | 202,720 | 227,146 | ||||||
| Cash and cash equivalents at end of period | $ | 205,224 | $ | 615,770 | ||||
