NASDAQ: CRUS

Stock Quote: NASD

Last Price: 88.37

Change: +2.07 (+2.4%)

Open: 85.46

Previous Close: 86.30

Dec 08, 2021 04:00 PM Pricing delayed 20 minutes

Cirrus Logic Reports Q2 FY22 Revenue of $465.9 Million

Nov 01, 2021

High-Performance Mixed-Signal Content Gains Drove 34 Percent Year-Over-Year Revenue Growth

Cirrus Logic, Inc. (Nasdaq: CRUS)today posted on its website at http://investor.cirrus.com the quarterly Shareholder Letter that contains the complete financial results for the second quarter fiscal year 2022, which ended Sept. 25, 2021, as well as the company’s current business outlook.

“Cirrus Logic reported record revenue and EPS for the September quarter and delivered solid year-over-year operating profit growth,” said John Forsyth, Cirrus Logic president and chief executive officer. “During the quarter we made great progress on the company’s strategy to diversify beyond audio. In our high-performance mixed-signal product line, we brought our new power conversion and control IC to market, increased the attach rate of ourcamera controllers in smartphones and sampled new fast-charging products to our general market customers. This represents a significant expansion of Cirrus Logic’s technology and product mix, with our high-performance mixed-signal business delivering 30 percent of total revenue in the first half fiscal year 2022, up 117 percent year over year. We continue to be excited about the opportunities these new technologies offer for further growth and diversification in the future.”

Reported Financial Results – Second Quarter FY22

  • Revenue of $465.9 million;
  • GAAP gross margin of 50.5 percent and non-GAAP gross margin of 51.3 percent;
  • GAAP operating expenses of $140.2 million and non-GAAP operating expenses of $114.5 million; and
  • GAAP earnings per share of $1.43 and non-GAAP earnings per share of $1.82.

A reconciliation of GAAP to non-GAAP financial information is included in the tables accompanying this press release.

Business Outlook – Third Quarter FY22

  • Revenue is expected to range between $490 million and $530 million;
  • GAAP gross margin is forecasted to be between 50 percent and 52 percent; and
  • Combined GAAP R&D and SG&A expenses are anticipated to range between $141 million and $147 million, including approximately $19 million in stock-based compensation expense, $9 million in amortization of acquired intangibles and $3 million in acquisition-related costs.

Cirrus Logic will host a live Q&A session at 5 p.m. EDT today to answer questions related to its financial results and business outlook. Participants may listen to the conference call on the Cirrus Logic website. Participants who would like to submit a question to be addressed during the call are requested to email investor@cirrus.com. A replay of the webcast can be accessed on the Cirrus Logic website approximately two hours following its completion, or by calling (416) 621-4642, or toll-free at (800) 585-8367 (Access Code: 3476036).

Cirrus Logic, Inc.

Cirrus Logic is a leader in low-power, high-precision mixed-signal processing solutions that create innovative user experiences for the world’s top mobile and consumer applications. With headquarters in Austin, Texas, Cirrus Logic is recognized globally for its award-winning corporate culture. Check us out at www.cirrus.com.

Cirrus Logic, Cirrus and the Cirrus Logic logo are registered trademarks of Cirrus Logic, Inc. All other company or product names noted herein may be trademarks of their respective holders.

Use of non-GAAP Financial Information

To supplement Cirrus Logic's financial statements presented on a GAAP basis, the company has provided non-GAAP financial information, including non-GAAP net income, diluted earnings per share, operating income and profit, operating expenses, gross margin and profit, tax expense, tax expense impact on earnings per share, and effective tax rate. A reconciliation of the adjustments to GAAP results is included in the tables below. Non-GAAP financial information is not meant as a substitute for GAAP results but is included because management believes such information is useful to our investors for informational and comparative purposes. In addition, certain non-GAAP financial information is used internally by management to evaluate and manage the company. The non-GAAP financial information used by Cirrus Logic may differ from that used by other companies. These non-GAAP measures should be considered in addition to, and not as a substitute for, the results prepared in accordance with GAAP.

Safe Harbor Statement

Except for historical information contained herein, the matters set forth in this news release contain forward-looking statements including our statements about our opportunities for further growth and diversification in the future, and our estimates for the third quarter fiscal year 2022 revenue, gross margin, combined research and development and selling, general and administrative expense levels, stock compensation expense and amortization of acquired intangibles. In some cases, forward-looking statements are identified by words such as “expect,” “anticipate,” “target,” “project,” “believe,” “goals,” “opportunity,” “estimates,” “intend,” and variations of these types of words and similar expressions. In addition, any statements that refer to our plans, expectations, strategies or other characterizations of future events or circumstances are forward-looking statements. These forward-looking statements are based on our current expectations, estimates, and assumptions and are subject to certain risks and uncertainties that could cause actual results to differ materially and readers should not place undue reliance on such statements. These risks and uncertainties include, but are not limited to, the following: the effects of the global COVID-19 outbreak and the measures taken to limit the spread of COVID-19, including any disruptions to our business that could result from measures to contain the outbreak that may be taken by governmental authorities in the jurisdictions in which we and our supply chain operate; the susceptibility of the markets we address to economic downturns, including as a result of the COVID-19 outbreak and the actions taken to mitigate the spread of COVID-19; the risks of doing business internationally, including increased import/export restrictions and controls (e.g., the effect of the U.S. Bureau of Industry and Security of the U.S. Department of Commerce placing Huawei Technologies Co., Ltd. and certain of its affiliates on the Bureau’s Entity List), imposition of trade protection measures (e.g., tariffs or taxes), security and health risks, possible disruptions in transportation networks, and other economic, social, military and geo-political conditions in the countries in which we, our customers or our suppliers operate; recent increased industry-wide capacity constraints that may impact our ability to meet current customer demand, which could cause an unanticipated decline in our sales and damage our existing customer relationships and our ability to establish new customer relationships; the potential for increased prices due to capacity constraints in our supply chain, which, if we are unable to increase our selling price to our customers, could result in lower revenues and margins that could adversely affect our financial results; the level of orders and shipments during the third quarter of fiscal year 2022, customer cancellations of orders, or the failure to place orders consistent with forecasts, along with the risk factors listed in our Form 10-K for the year ended March 28, 2021 and in our other filings with the Securities and Exchange Commission, which are available at www.sec.gov. The foregoing information concerning our business outlook represents our outlook as of the date of this news release, and we expressly disclaim any obligation to update or revise any forward-looking statements, whether as a result of new developments or otherwise.

Summary financial data follows:

CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
(unaudited)
(in thousands, except per share data)
 

Three Months Ended

 

Six Months Ended

 

 

 

 

 

 

 

 

 

Sep. 25,

 

Jun. 26,

 

Sep. 26,

 

Sep. 25,

 

Sep. 26,

 

2021

 

 

 

2021

 

 

 

2020

 

 

 

2021

 

 

 

2020

 

Q2'22

 

Q1'22

 

Q2'21

 

Q2'22

 

Q2'21

Audio

$

300,775

 

$

217,355

 

$

279,905

 

$

518,130

 

$

486,354

 

High-Performance Mixed-Signal

 

165,111

 

 

59,898

 

 

67,420

 

 

225,009

 

 

103,544

 

Net sales

 

465,886

 

 

277,253

 

 

347,325

 

 

743,139

 

 

589,898

 

Cost of sales

 

230,442

 

 

137,307

 

 

167,115

 

 

367,749

 

 

282,216

 

Gross profit

 

235,444

 

 

139,946

 

 

180,210

 

 

375,390

 

 

307,682

 

Gross margin

 

50.5

%

 

50.5

%

 

51.9

%

 

50.5

%

 

52.2

%

 
Research and development

 

102,116

 

 

85,696

 

 

84,810

 

 

187,812

 

 

163,551

 

Selling, general and administrative

 

38,132

 

 

35,147

 

 

31,247

 

 

73,279

 

 

60,951

 

Restructuring costs

 

-

 

 

-

 

 

-

 

 

-

 

 

352

 

Total operating expenses

 

140,248

 

 

120,843

 

 

116,057

 

 

261,091

 

 

224,854

 

 
Income from operations

 

95,196

 

 

19,103

 

 

64,153

 

 

114,299

 

 

82,828

 

 
Interest income

 

35

 

 

761

 

 

1,378

 

 

796

 

 

2,954

 

Other income (expense)

 

1,859

 

 

(242

)

 

784

 

 

1,617

 

 

895

 

Income before income taxes

 

97,090

 

 

19,622

 

 

66,315

 

 

116,712

 

 

86,677

 

Provision for income taxes

 

11,994

 

 

2,413

 

 

6,829

 

 

14,407

 

 

8,982

 

Net income

$

85,096

 

$

17,209

 

$

59,486

 

$

102,305

 

$

77,695

 

 
Basic earnings per share:

$

1.48

 

$

0.30

 

$

1.02

 

$

1.78

 

$

1.33

 

Diluted earnings per share:

$

1.43

 

$

0.29

 

$

0.99

 

$

1.72

 

$

1.29

 

 
Weighted average number of shares:
Basic

 

57,364

 

 

57,582

 

 

58,191

 

 

57,473

 

 

58,252

 

Diluted

 

59,451

 

 

59,513

 

 

60,127

 

 

59,485

 

 

60,203

 

 

Prepared in accordance with Generally Accepted Accounting Principles

RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL INFORMATION
(unaudited, in thousands, except per share data)
(not prepared in accordance with GAAP)
 
Non-GAAP financial information is not meant as a substitute for GAAP results, but is included because management believes such information is useful to our investors for informational and comparative purposes. In addition, certain non-GAAP financial information is used internally by management to evaluate and manage the company. As a note, the non-GAAP financial information used by Cirrus Logic may differ from that used by other companies. These non-GAAP measures should be considered in addition to, and not as a substitute for, the results prepared in accordance with GAAP.
 
 
 

Three Months Ended

 

Six Months Ended

 

 

 

 

 

 

 

 

 

Sep. 25,

 

Jun. 26,

 

Sep. 26,

 

Sep. 25,

 

Sep. 26,

 

2021

 

 

 

2021

 

 

 

2020

 

 

 

2021

 

 

 

2020

 

Net Income Reconciliation Q2'22 Q1'22 Q2'21 Q2'22 Q2'21
GAAP Net Income

$

85,096

 

$

17,209

 

$

59,486

 

$

102,305

 

$

77,695

 

Amortization of acquisition intangibles

 

7,054

 

 

2,998

 

 

2,998

 

 

10,052

 

 

5,996

 

Stock-based compensation expense

 

16,551

 

 

14,984

 

 

15,476

 

 

31,535

 

 

28,782

 

Restructuring costs

 

-

 

 

-

 

 

-

 

 

-

 

 

352

 

Acquisition-related costs

 

5,834

 

 

-

 

 

-

 

 

5,834

 

 

-

 

Adjustment to income taxes

 

(6,045

)

 

(2,949

)

 

(2,293

)

 

(8,994

)

 

(5,275

)

Non-GAAP Net Income

$

108,490

 

$

32,242

 

$

75,667

 

$

140,732

 

$

107,550

 

 
Earnings Per Share Reconciliation
GAAP Diluted earnings per share

$

1.43

 

$

0.29

 

$

0.99

 

$

1.72

 

$

1.29

 

Effect of Amortization of acquisition intangibles

 

0.12

 

 

0.05

 

 

0.05

 

 

0.17

 

 

0.10

 

Effect of Stock-based compensation expense

 

0.28

 

 

0.25

 

 

0.26

 

 

0.53

 

 

0.48

 

Effect of Restructuring costs

 

-

 

 

-

 

 

-

 

 

-

 

 

0.01

 

Effect of Acquisition-related costs

 

0.09

 

 

-

 

 

-

 

 

0.09

 

 

-

 

Effect of Adjustment to income taxes

 

(0.10

)

 

(0.05

)

 

(0.04

)

 

(0.14

)

 

(0.09

)

Non-GAAP Diluted earnings per share

$

1.82

 

$

0.54

 

$

1.26

 

$

2.37

 

$

1.79

 

 
Operating Income Reconciliation
GAAP Operating Income

$

95,196

 

$

19,103

 

$

64,153

 

$

114,299

 

$

82,828

 

GAAP Operating Profit

 

20.4

%

 

6.9

%

 

18.5

%

 

15.4

%

 

14.0

%

Amortization of acquisition intangibles

 

7,054

 

 

2,998

 

 

2,998

 

 

10,052

 

 

5,996

 

Stock-based compensation expense - COGS

 

272

 

 

246

 

 

197

 

 

518

 

 

404

 

Stock-based compensation expense - R&D

 

10,496

 

 

9,612

 

 

9,235

 

 

20,108

 

 

17,888

 

Stock-based compensation expense - SG&A

 

5,783

 

 

5,126

 

 

6,044

 

 

10,909

 

 

10,490

 

Restructuring costs

 

-

 

 

-

 

 

-

 

 

-

 

 

352

 

Acquisition-related costs

 

5,834

 

 

-

 

 

-

 

 

5,834

 

 

-

 

Non-GAAP Operating Income

$

124,635

 

$

37,085

 

$

82,627

 

$

161,720

 

$

117,958

 

Non-GAAP Operating Profit

 

26.8

%

 

13.4

%

 

23.8

%

 

21.8

%

 

20.0

%

 
Operating Expense Reconciliation
GAAP Operating Expenses

$

140,248

 

$

120,843

 

$

116,057

 

$

261,091

 

$

224,854

 

Amortization of acquisition intangibles

 

(7,054

)

 

(2,998

)

 

(2,998

)

 

(10,052

)

 

(5,996

)

Stock-based compensation expense - R&D

 

(10,496

)

 

(9,612

)

 

(9,235

)

 

(20,108

)

 

(17,888

)

Stock-based compensation expense - SG&A

 

(5,783

)

 

(5,126

)

 

(6,044

)

 

(10,909

)

 

(10,490

)

Restructuring costs

 

-

 

 

-

 

 

-

 

 

-

 

 

(352

)

Acquisition-related costs

 

(2,373

)

 

-

 

 

-

 

 

(2,373

)

 

-

 

Non-GAAP Operating Expenses

$

114,542

 

$

103,107

 

$

97,780

 

$

217,649

 

$

190,128

 

 
Gross Margin/Profit Reconciliation
GAAP Gross Profit

$

235,444

 

$

139,946

 

$

180,210

 

$

375,390

 

$

307,682

 

GAAP Gross Margin

 

50.5

%

 

50.5

%

 

51.9

%

 

50.5

%

 

52.2

%

Acquisition-related costs

 

3,461

 

 

-

 

 

-

 

 

3,461

 

 

-

 

Stock-based compensation expense - COGS

 

272

 

 

246

 

 

197

 

 

518

 

 

404

 

Non-GAAP Gross Profit

$

239,177

 

$

140,192

 

$

180,407

 

$

379,369

 

$

308,086

 

Non-GAAP Gross Margin

 

51.3

%

 

50.6

%

 

51.9

%

 

51.0

%

 

52.2

%

 
Effective Tax Rate Reconciliation
GAAP Tax Expense

$

11,994

 

$

2,413

 

$

6,829

 

$

14,407

 

$

8,982

 

GAAP Effective Tax Rate

 

12.4

%

 

12.3

%

 

10.3

%

 

12.3

%

 

10.4

%

Adjustments to income taxes

 

6,045

 

 

2,949

 

 

2,293

 

 

8,994

 

 

5,275

 

Non-GAAP Tax Expense

$

18,039

 

$

5,362

 

$

9,122

 

$

23,401

 

$

14,257

 

Non-GAAP Effective Tax Rate

 

14.3

%

 

14.3

%

 

10.8

%

 

14.3

%

 

11.7

%

 
Tax Impact to EPS Reconciliation
GAAP Tax Expense

$

0.20

 

$

0.04

 

$

0.11

 

$

0.24

 

$

0.15

 

Adjustments to income taxes

 

0.10

 

 

0.05

 

 

0.04

 

 

0.14

 

 

0.09

 

Non-GAAP Tax Expense

$

0.30

 

$

0.09

 

$

0.15

 

$

0.38

 

$

0.24

 

 
CONSOLIDATED CONDENSED BALANCE SHEET
unaudited; in thousands

Sep. 25,

Mar. 27,

Sep. 26,

2021

2021

2020

ASSETS
Current assets
Cash and cash equivalents

$

386,741

$

442,164

$

247,536

Marketable securities

 

8,152

 

55,697

 

36,641

Accounts receivable, net

 

280,967

 

108,712

 

181,496

Inventories

 

188,360

 

173,263

 

209,050

Other current assets

 

84,836

 

62,683

 

34,508

Total current Assets

 

949,056

 

842,519

 

709,231

 
Long-term marketable securities

 

67,726

 

312,759

 

328,255

Right-of-use lease assets

 

129,298

 

133,548

 

137,045

Property and equipment, net

 

159,480

 

154,942

 

153,640

Intangibles, net

 

174,852

 

22,031

 

27,898

Goodwill

 

437,783

 

287,518

 

287,673

Deferred tax asset

 

10,073

 

9,977

 

7,899

Long-term prepaid wafers

 

195,000

 

-

 

-

Other assets

 

102,892

 

67,320

 

48,223

Total assets

$

2,226,160

$

1,830,614

$

1,699,864

 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable

$

386,699

$

102,744

$

99,105

Accrued salaries and benefits

 

54,919

 

54,849

 

41,707

Lease liability

 

14,359

 

14,573

 

13,994

Other accrued liabilities

 

44,404

 

41,444

 

23,237

Total current liabilities

 

500,381

 

213,610

 

178,043

 
Non-current lease liability

 

122,815

 

127,883

 

128,570

Non-current income taxes

 

79,727

 

64,020

 

66,503

Long-term acquisition-related liabilities

 

33,329

 

-

 

-

Other long-term liabilities

 

21,818

 

36,096

 

9,917

 
Stockholders' equity:
Capital stock

 

1,533,557

 

1,498,819

 

1,466,978

Accumulated deficit

 

(65,672)

 

(112,689)

 

(155,260)

Accumulated other comprehensive income

 

205

 

2,875

 

5,113

Total stockholders' equity

 

1,468,090

 

1,389,005

 

1,316,831

Total liabilities and stockholders' equity

$

2,226,160

$

1,830,614

$

1,699,864

 
Prepared in accordance with Generally Accepted Accounting Principles

 

Investor Contact:
Thurman K. Case
Chief Financial Officer
Cirrus Logic, Inc.
(512) 851-4125
Investor@cirrus.com

Source: Cirrus Logic, Inc.

By clicking ‘Subscribe’ above you consent to us processing your personal data to enable us to respond to and, if appropriate, follow up on your query and to communicate with you about further related actions and queries and our products.  Our Privacy Policy provides further information about how we manage your personal data.

Get Updates

First Name *
Email Address *
Mailing Lists *





 
Enter the code shown above.