Press Releases

Silicon Labs Announces Fourth Quarter and Full Year 2020 Results
-- Record Fourth Quarter Revenue Sets the Stage for an Even Stronger 2021 --

AUSTIN, Texas, Feb. 3, 2021 /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 January 2, 2021. Revenue exceeded the top end of the guidance range at $242.9 million, up from $221.3 million in the third quarter. Revenue for the full year was $886.7 million, up from $837.6 million in 2019. Fourth quarter GAAP and non-GAAP diluted earnings per share (EPS) were $0.20 and $0.84, respectively. Full year GAAP and non-GAAP diluted EPS were $0.28 and $3.01, respectively.

"Fourth quarter revenue set a record at $242.9 million resulting in 10% sequential growth and full year revenue grew 6% over 2019," said Tyson Tuttle, CEO of Silicon Labs. "Our IoT products led the way with a second consecutive quarter of record revenue. We exited the year with momentum, and we are looking forward to an even stronger 2021."

Fourth Quarter Financial Highlights

  • IoT revenue increased to $147.4 million, up 11% sequentially and 15% year-on-year.
  • Infrastructure and Automotive revenue increased to $95.5 million, up 8% sequentially and 4% year-on-year.

On a GAAP basis:                                                                                         

  • GAAP gross margin was 58.4%.
  • GAAP R&D expenses were $74 million.
  • GAAP SG&A expenses were $50 million.
  • GAAP operating income as a percentage of revenue was 7.3%.
  • GAAP diluted earnings per share was $0.20.

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 58.6%.
  • Non-GAAP R&D expenses were $58 million.
  • Non-GAAP SG&A expenses were $39 million.
  • Non-GAAP operating income as a percentage of revenue was 18.7%.
  • Non-GAAP diluted earnings per share were $0.84.

Product Results

  • Announced Z-Wave Long Range (LR) support for existing Z-Wave 700 Series products. Z-Wave LR is a new specification by the Z-Wave Alliance, offering point-to-point wireless connectivity up to several miles away with scalability to support thousands of nodes from a single smart home network. Z-Wave LR eliminates the need for mesh repeaters, saving time and money for developers and end customers.
  • Announced a portfolio expansion of pre-certified wireless modules specifically designed to address modern needs of IoT application development. The portfolio consists of the only modules in the industry with full stack support for multiprotocol solutions to enable commercial and consumer IoT applications, with flexible package options and highly integrated device security. Silicon Labs' new modules include xGM210PB, BGM220, MGM220, and BGX220 Xpress. The xGM210PB includes Secure Vault technology and PSA level 2 certification.

Business Highlights

  • Announced a collaboration with Orvibo, a leading provider of artificial intelligence-driven smart home products, systems, and solutions, to develop a new line of smart home devices using Silicon Labs' Wireless Gecko Series 2 SoCs. Orvibo's latest MixPad smart panels leverage Silicon Labs' SoCs to reliably connect smart home control panels and switches to many applications including automated lighting, curtain, HVAC systems, and wireless home security devices.
  • Extended ClockBuilder Pro to support configuration and control of our IEEE 1588 modules, helping customers accelerate time to market and simplify design. Our IEEE 1588 modules are used in communications, smart grid, financial trading systems and industrial applications that need a consistent, reliable time reference between devices operating over Ethernet networks.
  • Announced a new high reliability isolation partnership with Teledyne Technologies, a leading provider of high-performance, high-reliability semiconductors for the aerospace and defense markets. Under the new agreement, Teledyne will market custom high reliability solutions based on Silicon Labs' Si827x isolated gate driver family. These solutions are optimized for space, aerospace, military, energy and other markets requiring advanced technology and high reliability.
  • Awarded Gold in 2020 LEAP Awards for Secure Vault. Silicon Labs products with Secure Vault were the first SoC and module with a radio to earn PSA Level 2 security certification.

Business Outlook

The company expects first quarter revenue to be in the range of $237 to $247 million, with both IoT and Infrastructure & Automotive approximately flat to fourth quarter, and estimates the following:

On a GAAP basis:

  • GAAP gross margin at approximately 58.1%.
  • GAAP operating expenses at approximately $126 million.
  • GAAP effective tax rate of 0.0%.
  • GAAP diluted earnings per share between $0.05 and $0.15.

On a non-GAAP basis, excluding the impact of stock compensation, amortization of acquired intangible assets, acquisition related charges, 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 at approximately 58.2%.
  • Non-GAAP operating expenses at approximately $100 million.
  • Non-GAAP effective tax rate at 13.0%.
  • Non-GAAP diluted earnings per share between $0.70 and $0.80.

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 10145993. The replay will be available through March 3, 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 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.

 

Silicon Laboratories Inc.

Condensed Consolidated Statements of Income

 (In thousands, except per share data)

(Unaudited)

 
 

Three Months Ended

 

Year Ended

 

January 2,
2021

 

December 28,
2019

 

January 2,
2021

 

December 28,
2019

Revenues

$242,917

 

$219,438

 

$886,677

 

$837,554

Cost of revenues

100,942

 

86,167

 

359,151

 

327,270

Gross profit

141,975

 

133,271

 

527,526

 

510,284

Operating expenses:

             

   Research and development

73,857

 

69,176

 

287,887

 

257,150

   Selling, general and administrative

50,456

 

50,866

 

201,339

 

196,437

Operating expenses

124,313

 

120,042

 

489,226

 

453,587

Operating income

17,662

 

13,229

 

38,300

 

56,697

Other income (expense):

             

   Interest income and other, net

2,581

 

3,494

 

11,143

 

13,185

   Interest expense

(8,219)

 

(5,105)

 

(34,142)

 

(20,233)

Income before income taxes

12,024

 

11,618

 

15,301

 

49,649

Provision for income taxes

3,076

 

1,903

 

2,770

 

30,384

 

Net income

$    8,948

 

$    9,715

 

$  12,531

 

$  19,265

               

Earnings per share:

             

   Basic

$      0.20

 

$      0.22

 

$      0.29

 

$      0.44

   Diluted

$      0.20

 

$      0.22

 

$      0.28

 

$      0.43

               

Weighted-average common shares outstanding:

             

   Basic

43,895

 

43,450

 

43,775

 

43,346

   Diluted

44,729

 

44,801

 

44,372

 

44,290

 

Unaudited Reconciliation of GAAP to Non-GAAP Financial Measures

(In thousands, except per share data)

 

Non-GAAP Income
Statement Items

 

Three Months Ended

January 2, 2021

   

GAAP

Measure

 

GAAP

Percent of
Revenue

 

Stock

Compensation
Expense

 

Intangible
Asset
Amortization

 

Non-GAAP

Measure

 

Non-GAAP

Percent of
Revenue

Revenues

 

$242,917

                   
                         

Gross profit

 

141,975

 

58.4%

 

$     375

 

$        --

 

$142,350

 

58.6%

                         

Research and

   development

 

73,857

 

30.4%

 

7,386

 

8,654

 

57,817

 

23.8%

                         

Selling, general and

   administrative

 

50,456

 

 

20.7%

 

8,000

 

3,338

 

39,118

 

 

16.1%

                         

Operating income

 

17,662

 

7.3%

 

15,761

 

11,992

 

45,415

 

18.7%

 

Non-GAAP
Earnings Per Share

 

Three Months Ended
January 2, 2021

   

GAAP

Measure

 

Stock

Compensation
Expense*

 

Intangible
Asset
Amortization*

 

Investment
Fair Value
Adjustments*

 

Interest
Expense

Adjustments*

 

Income

Tax

Adjustments

 

Non-
GAAP
Measure

Net income

 

$  8,948

 

$15,761

 

$11,992

 

$(1,438)

 

$6,039

 

$(3,685)

 

$37,617

                             

Diluted shares

   outstanding

 

 

44,729

                     

44,729

                             

Diluted earnings

   per share

 

$    0.20

                     

 

$    0.84

 

* Represents pre-tax amounts

 

Non-GAAP
Earnings Per Share

 

Year Ended
January 2, 2021

   

GAAP

Measure

 

Stock

Compensation
Expense*

 

Intangible
Asset
Amortization*

 

Acquisition
Related
Items*

 

 

Restructuring
Charges*

 

Investment
Fair Value
Adjustments*

 

Interest
Expense

Adjustments*

 

Income

Tax

Adjustments

 

Non-
GAAP
Measure

Net income

 

$12,531

 

$60,091

 

$44,733

 

$6,061

 

$4,269

 

$(1,438)

 

$24,350

 

$(17,074)

 

$133,523

                                     

Diluted shares

   outstanding

 

 

44,372

                             

44,372

                                     

Diluted earnings

   per share

 

$    0.28

                             

 

$    3.01

 

* Represents pre-tax amounts

 

Unaudited Forward-Looking Statements Regarding Business Outlook

(In millions, except per share data)

 

Business Outlook

 

Three Months Ending

April 3, 2021

   

GAAP

Measure

 

Non-GAAP

Adjustments*

 

Non-GAAP

Measure

Gross margin

 

58.1%

 

0.1%

 

58.2%

             

Operating expenses

 

$126

 

$26

 

$100

             

Effective tax rate

 

0.0%

 

13.0%

 

13.0%

             

Diluted earnings per share - low

 

$0.05

 

$0.65

 

$0.70

             

Diluted earnings per share - high

 

$0.15

 

$0.65

 

$0.80

 

* Non-GAAP adjustments include the following estimates: stock compensation expense
of $13.9 million, intangible asset amortization of $11.7 million, interest expense
adjustments of $9.4 million, and the associated tax impact from the aforementioned
items.

 

Silicon Laboratories Inc.

Condensed Consolidated Balance Sheets

(In thousands, except per share data)

(Unaudited)

 
 

January 2,
2021

 

December 28,
2019

Assets

     

Current assets:

     

   Cash and cash equivalents

$   202,720

 

$   227,146

   Short-term investments

521,963

 

498,825

   Accounts receivable, net

95,169

 

75,639

   Inventories

66,662

 

73,057

   Prepaid expenses and other current assets

89,307

 

69,192

Total current assets

975,821

 

943,859

Property and equipment, net

139,439

 

135,939

Goodwill

631,932

 

398,402

Other intangible assets, net

166,084

 

134,279

Other assets, net

80,211

 

62,374

Total assets

$1,993,487

 

$1,674,853

       

Liabilities and Stockholders' Equity

     

Current liabilities:

     

   Accounts payable

$     54,949

 

$     38,899

   Current portion of convertible debt, net

134,480

 

--

   Deferred revenue and returns liability

12,986

 

19,251

   Other current liabilities

82,083

 

79,551

Total current liabilities

284,498

 

137,701

Convertible debt, net

428,945

 

368,257

Other non-current liabilities

80,203

 

53,844

Total liabilities

793,646

 

559,802

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;  

      43,925 and 43,496 shares issued and outstanding at

      January 2, 2021 and December 28, 2019, respectively

4

 

4

   Additional paid-in capital

204,359

 

133,793

   Retained earnings

993,664

 

980,608

   Accumulated other comprehensive income

1,814

 

646

Total stockholders' equity

1,199,841

 

1,115,051

Total liabilities and stockholders' equity

$1,993,487

 

$1,674,853

 

Silicon Laboratories Inc.

Condensed Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)

 
 

Year Ended

 

January 2,
2021

 

December 28,
2019

Operating Activities

     

Net income

$  12,531

 

$  19,265

Adjustments to reconcile net income to cash provided by
operating activities:

     

   Depreciation of property and equipment

17,780

 

16,883

   Amortization of other intangible assets and other assets

44,733

 

39,584

   Amortization of debt discount and debt issuance costs 

21,433

 

13,485

   Loss on extinguishment of convertible debt

4,060

 

--

   Stock-based compensation expense

60,091

 

54,799

   Deferred income taxes

(6,533)

 

23,048

   Changes in operating assets and liabilities:

     

      Accounts receivable

(17,612)

 

(2,401)

      Inventories

10,748

 

2,171

      Prepaid expenses and other assets

(51,839)

 

8,965

      Accounts payable

15,263

 

7,830

      Other current liabilities and income taxes

3,257

 

(6,826)

      Deferred revenue and returns liability

(6,694)

 

(3,243)

      Other non-current liabilities

28,500

 

(7,038)

Net cash provided by operating activities

135,718

 

166,522

       

Investing Activities

     

Purchases of available-for-sale investments

(519,567)

 

(424,524)

Sales and maturities of available-for-sale investments

497,357

 

344,937

Purchases of property and equipment

(20,422)

 

(16,279)

Purchases of other assets

(1,570)

 

(8,396)

Acquisitions of businesses, net of cash acquired

(316,809)

 

(2,510)

Net cash used in investing activities

(361,011)

 

(106,772)

       

Financing Activities

     

Proceeds from issuance of debt

845,000

 

--

Payments on debt

(624,737)

 

(1,132)

Repurchases of common stock

(16,287)

 

(26,716)

Payment of taxes withheld for vested stock awards

(18,124)

 

(16,295)

Proceeds from the issuance of common stock

15,015

 

14,496

Net cash provided by (used in) financing activities

200,867

 

(29,647)

       

Increase (decrease) in cash and cash equivalents

(24,426)

 

30,103

Cash and cash equivalents at beginning of period

227,146

 

197,043

Cash and cash equivalents at end of period

$202,720

 

$227,146

 

 

SOURCE Silicon Labs

For further information: George Lane, +1 (512) 712-0019, George.Lane@silabs.com