Press Releases

Silicon Labs Announces Second Quarter 2013 Results
Record Revenue in Timing and Broadcast Video Product Lines
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

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.

 
 
Silicon Laboratories Inc.
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  
Provision (benefit) for income taxes       5,852       (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:                    
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  

 

Contact:

Silicon Labs
Deborah Stapleton, +1-650-470-4200
Deborah.Stapleton@silabs.com