Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil EL&P Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries Power Integrations Reports Fourth-Quarter and Full-Year Financial Results By: Power Integrations, Inc. via Business Wire February 08, 2024 at 16:01 PM EST Quarterly revenues were $89.5 million; GAAP earnings were $0.25 per diluted share; non-GAAP earnings were $0.22 per diluted share Company repurchased 680 thousand shares during the quarter for $47 million Power Integrations (NASDAQ: POWI) today announced financial results for the quarter and year ended December 31, 2023. Net revenues for the fourth quarter were $89.5 million, down 29 percent compared to the prior quarter and down 28 percent from the fourth quarter of 2022. GAAP net income for the fourth quarter was $14.3 million or $0.25 per diluted share compared to $0.34 per diluted share in the prior quarter and $0.40 per diluted share in the fourth quarter of 2022. For the full year, net revenues were $444.5 million, compared to $651.1 million in the prior year. Full-year GAAP net income was $55.7 million or $0.97 per diluted share compared to $2.93 per diluted share in the prior year. Full-year cash flow from operations was $65.8 million. In addition to its GAAP results, the company provided non-GAAP measures that for the fourth quarter of 2023 exclude stock-based compensation, amortization of acquisition-related intangible assets and the related tax effects. Non-GAAP net income for the fourth quarter of 2023 was $12.7 million or $0.22 per diluted share compared to $0.46 per diluted share in the prior quarter and $0.48 per diluted share in the fourth quarter of 2022. For the full year, non-GAAP net income was $74.5 million or $1.29 per diluted share compared to $3.29 per diluted share in the prior year. A reconciliation of GAAP to non-GAAP financial results is included with the tables accompanying this press release. Commented Balu Balakrishnan, chairman and CEO of Power Integrations: “Fourth-quarter revenues declined as expected, and we project first-quarter sales to be about flat sequentially due to continued soft demand and elevated supply-chain inventories. However, channel inventory fell significantly in the fourth quarter, and we expect a further reduction in the first quarter. Based on lower inventories and seasonal patterns we expect sequential revenue growth beginning in the June quarter. We also expect gross margin to rise in the June quarter driven by the dollar/yen exchange rate, higher manufacturing utilization and end-market mix.” During the fourth quarter Power Integrations repurchased 680 thousand shares of its common stock for $47.4 million. The company had $26.0 million remaining on its repurchase authorization as of December 31, 2023. Power Integrations paid a dividend of $0.20 per share on December 29, 2023, and will pay a dividend of $0.20 per share on March 29, 2024, to stockholders of record as of February 29, 2024. Financial Outlook The company issued the following forecast for the first quarter of 2024: Revenues are expected to be $90 million plus or minus $5 million. GAAP gross margin is expected to be approximately 51.5 percent; non-GAAP gross margin is expected to be approximately 52.5 percent. The difference between GAAP and non-GAAP gross margins is equally attributable to stock-based compensation and amortization of acquisition-related intangible assets. GAAP operating expenses are expected to be approximately $49 million; non-GAAP operating expenses are expected to be approximately $42.5 million. Non-GAAP operating expenses are expected to exclude about $6.5 million of stock-based compensation. Conference Call Today at 1:30 p.m. Pacific Time Power Integrations management will hold a conference call today at 1:30 p.m. Pacific time. Members of the investment community can register for the call by visiting the following link: https://registrations.events/direct/Q4I24588. A live webcast of the call will also be available on the investor section of the company's website, http://investors.power.com. About Power Integrations Power Integrations, Inc. is a leading innovator in semiconductor technologies for high-voltage power conversion. The company’s products are key building blocks in the clean-power ecosystem, enabling the generation of renewable energy as well as the efficient transmission and consumption of power in applications ranging from milliwatts to megawatts. For more information, please visit www.power.com. Note Regarding Use of Non-GAAP Financial Measures In addition to the company's consolidated financial statements, which are presented according to GAAP, the company provides certain non-GAAP financial information that excludes stock-based compensation expenses recorded under ASC 718-10, amortization of acquisition-related intangible assets, net other operating expenses of $1.1 million in the second quarter of 2022 stemming from a patent-litigation settlement and an offsetting recovery from the liquidation of SemiSouth Laboratories, and the tax effects of these items. The company uses these measures in its financial and operational decision-making and, with respect to one measure, in setting performance targets for compensation purposes. The company believes that these non-GAAP measures offer important analytical tools to help investors understand its operating results, and to facilitate comparability with the results of companies that provide similar measures. Non-GAAP measures have limitations as analytical tools and are not meant to be considered in isolation or as a substitute for GAAP financial information. For example, stock-based compensation is an important component of the company’s compensation mix and will continue to result in significant expenses in the company’s GAAP results for the foreseeable future but is not reflected in the non-GAAP measures. Also, other companies, including companies in Power Integrations’ industry, may calculate non-GAAP measures differently, limiting their usefulness as comparative measures. Reconciliations of non-GAAP measures to GAAP measures are attached to this press release. Note Regarding Forward-Looking Statements The above statements regarding the company’s forecast for its first-quarter financial performance, sequential growth beginning in the second quarter, channel inventory trends and rising gross margins over the course of the year are forward-looking statements reflecting management's current expectations and beliefs. These statements are based on current information that is, by its nature, subject to rapid and even abrupt change. Due to risks and uncertainties associated with the company's business, actual results could differ materially from those projected or implied by these statements. These risks and uncertainties include, but are not limited to: the company’s ability to supply products and its ability to conduct other aspects of its business such as competing for new design wins; changes in global economic and geopolitical conditions, including such factors as inflation, armed conflicts and trade negotiations, which may impact the level of demand for the company’s products; potential changes and shifts in customer demand away from end products that utilize the company's integrated circuits to end products that do not incorporate the company's products; the effects of competition, which may cause the company’s revenues to decrease or cause the company to decrease its selling prices for its products; unforeseen costs and expenses; and unfavorable fluctuations in component costs or operating expenses resulting from changes in commodity prices and/or exchange rates. In addition, new product introductions and design wins are subject to the risks and uncertainties that typically accompany development and delivery of complex technologies to the marketplace, including product development delays and defects and market acceptance of the new products. These and other risk factors that may cause actual results to differ are more fully explained under the caption “Risk Factors” in the company's most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 7, 2023. The company is under no obligation (and expressly disclaims any obligation) to update or alter its forward-looking statements, whether because of new information, future events or otherwise, except as otherwise required by law. Power Integrations and the Power Integrations logo are trademarks or registered trademarks of Power Integrations, Inc. All other trademarks are property of their respective owners. POWER INTEGRATIONS, INC. CONSOLIDATED STATEMENTS OF INCOME (in thousands, except per-share amounts) Three Months Ended Twelve Months Ended December 31, 2023 September 30, 2023 December 31, 2022 December 31, 2023 December 31, 2022 NET REVENUES $ 89,507 $ 125,511 $ 124,770 $ 444,538 $ 651,138 COST OF REVENUES 43,299 59,566 57,416 215,582 284,231 GROSS PROFIT 46,208 65,945 67,354 228,956 366,907 OPERATING EXPENSES: Research and development 23,505 24,064 23,504 96,067 93,894 Sales and marketing 15,472 16,224 15,493 64,598 62,333 General and administrative 8,282 7,945 7,465 33,232 28,897 Amortization of acquisition-related intangible assets - - - - 241 Other operating expenses, net - - - - 1,130 Total operating expenses 47,259 48,233 46,462 193,897 186,495 INCOME (LOSS) FROM OPERATIONS (1,051 ) 17,712 20,892 35,059 180,412 OTHER INCOME 3,282 3,138 785 10,848 3,014 INCOME BEFORE INCOME TAXES 2,231 20,850 21,677 45,907 183,426 PROVISION (BENEFIT) FOR INCOME TAXES (12,040 ) 1,054 (1,138 ) (9,828 ) 12,575 NET INCOME $ 14,271 $ 19,796 $ 22,815 $ 55,735 $ 170,851 EARNINGS PER SHARE: Basic $ 0.25 $ 0.34 $ 0.40 $ 0.97 $ 2.96 Diluted $ 0.25 $ 0.34 $ 0.40 $ 0.97 $ 2.93 SHARES USED IN PER-SHARE CALCULATION: Basic 56,937 57,383 57,094 57,195 57,801 Diluted 57,272 57,741 57,535 57,622 58,371 SUPPLEMENTAL INFORMATION: Three Months Ended Twelve Months Ended December 31, 2023 September 30, 2023 December 31, 2022 December 31, 2023 December 31, 2022 Stock-based compensation expenses included in: Cost of revenues $ 499 $ 446 $ 405 $ 1,692 $ 1,132 Research and development 2,947 2,895 2,716 10,939 10,428 Sales and marketing 1,827 1,787 1,643 6,888 6,035 General and administrative 2,230 1,777 1,890 9,009 4,769 Total stock-based compensation expense $ 7,503 $ 6,905 $ 6,654 $ 28,528 $ 22,364 Cost of revenues includes: Amortization of acquisition-related intangible assets $ 482 $ 482 $ 482 $ 1,928 $ 1,928 Three Months Ended Twelve Months Ended REVENUE MIX BY END MARKET December 31, 2023 September 30, 2023 December 31, 2022 December 31, 2023 December 31, 2022 Communications 27 % 32 % 23 % 29 % 21 % Computer 9 % 10 % 12 % 12 % 10 % Consumer 29 % 26 % 26 % 27 % 33 % Industrial 35 % 32 % 39 % 32 % 36 % POWER INTEGRATIONS, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP RESULTS (in thousands, except per-share amounts) Three Months Ended Twelve Months Ended December 31,2023 September 30,2023 December 31,2022 December 31,2023 December 31,2022 RECONCILIATION OF GROSS PROFIT GAAP gross profit $ 46,208 $ 65,945 $ 67,354 $ 228,956 $ 366,907 GAAP gross margin 51.6 % 52.5 % 54.0 % 51.5 % 56.3 % Stock-based compensation included in cost of revenues 499 446 405 1,692 1,132 Amortization of acquisition-related intangible assets 482 482 482 1,928 1,928 Non-GAAP gross profit $ 47,189 $ 66,873 $ 68,241 $ 232,576 $ 369,967 Non-GAAP gross margin 52.7 % 53.3 % 54.7 % 52.3 % 56.8 % Three Months Ended Twelve Months Ended RECONCILIATION OF OPERATING EXPENSES December 31,2023 September 30,2023 December 31,2022 December 31,2023 December 31,2022 GAAP operating expenses $ 47,259 $ 48,233 $ 46,462 $ 193,897 $ 186,495 Less: Stock-based compensation expense included in operating expenses Research and development 2,947 2,895 2,716 10,939 10,428 Sales and marketing 1,827 1,787 1,643 6,888 6,035 General and administrative 2,230 1,777 1,890 9,009 4,769 Total 7,004 6,459 6,249 26,836 21,232 Amortization of acquisition-related intangible assets - - - - 241 Other operating expenses, net - - - - 1,130 Non-GAAP operating expenses $ 40,255 $ 41,774 $ 40,213 $ 167,061 $ 163,892 Three Months Ended Twelve Months Ended RECONCILIATION OF INCOME FROM OPERATIONS December 31,2023 September 30,2023 December 31,2022 December 31,2023 December 31,2022 GAAP income (loss) from operations $ (1,051 ) $ 17,712 $ 20,892 $ 35,059 $ 180,412 GAAP operating margin -1.2 % 14.1 % 16.7 % 7.9 % 27.7 % Add: Total stock-based compensation 7,503 6,905 6,654 28,528 22,364 Amortization of acquisition-related intangible assets 482 482 482 1,928 2,169 Other operating expenses, net - - - - 1,130 Non-GAAP income from operations $ 6,934 $ 25,099 $ 28,028 $ 65,515 $ 206,075 Non-GAAP operating margin 7.7 % 20.0 % 22.5 % 14.7 % 31.6 % Three Months Ended Twelve Months Ended RECONCILIATION OF PROVISION FOR INCOME TAXES December 31,2023 September 30,2023 December 31,2022 December 31,2023 December 31,2022 GAAP provision (benefit) for income taxes $ (12,040 ) $ 1,054 $ (1,138 ) $ (9,828 ) $ 12,575 GAAP effective tax rate -539.7 % 5.1 % -5.2 % -21.4 % 6.9 % Tax effect of adjustments to GAAP results (9,556 ) (580 ) (2,085 ) (11,653 ) (4,582 ) Non-GAAP provision (benefit) for income taxes $ (2,484 ) $ 1,634 $ 947 $ 1,825 $ 17,157 Non-GAAP effective tax rate -24.3 % 5.8 % 3.3 % 2.4 % 8.2 % Three Months Ended Twelve Months Ended RECONCILIATION OF NET INCOME PER SHARE (DILUTED) December 31,2023 September 30,2023 December 31,2022 December 31,2023 December 31,2022 GAAP net income $ 14,271 $ 19,796 $ 22,815 $ 55,735 $ 170,851 Adjustments to GAAP net income Stock-based compensation 7,503 6,905 6,654 28,528 22,364 Amortization of acquisition-related intangible assets 482 482 482 1,928 2,169 Other operating expenses, net - - - - 1,130 Tax effect of items excluded from non-GAAP results (9,556 ) (580 ) (2,085 ) (11,653 ) (4,582 ) Non-GAAP net income $ 12,700 $ 26,603 $ 27,866 $ 74,538 $ 191,932 Average shares outstanding for calculation of non-GAAP net income per share (diluted) 57,272 57,741 57,535 57,622 58,371 Non-GAAP net income per share (diluted) $ 0.22 $ 0.46 $ 0.48 $ 1.29 $ 3.29 GAAP net income per share (diluted) $ 0.25 $ 0.34 $ 0.40 $ 0.97 $ 2.93 POWER INTEGRATIONS, INC. CONSOLIDATED BALANCE SHEETS (in thousands) December 31, 2023 September 30, 2023 December 31, 2022 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 63,929 $ 94,743 $ 105,372 Short-term marketable securities 247,640 261,896 248,441 Accounts receivable, net 14,674 28,539 20,836 Inventories 163,164 150,246 135,420 Prepaid expenses and other current assets 22,193 20,692 15,004 Total current assets 511,600 556,116 525,073 PROPERTY AND EQUIPMENT, net 164,213 166,391 176,681 INTANGIBLE ASSETS, net 4,424 4,967 6,597 GOODWILL 91,849 91,849 91,849 DEFERRED TAX ASSETS 28,325 28,943 19,034 OTHER ASSETS 19,457 17,224 20,862 Total assets $ 819,868 $ 865,490 $ 840,096 LIABILITIES AND STOCKHOLDERS’ EQUITY CURRENT LIABILITIES: Accounts payable $ 26,390 $ 28,553 $ 30,088 Accrued payroll and related expenses 13,551 13,778 14,778 Taxes payable 1,016 774 938 Other accrued liabilities 7,910 10,316 12,572 Total current liabilities 48,867 53,421 58,376 LONG-TERM LIABILITIES: Income taxes payable 6,244 16,724 15,757 Other liabilities 12,516 10,288 10,747 Total liabilities 67,627 80,433 84,880 STOCKHOLDERS' EQUITY: Common stock 23 23 24 Additional paid-in capital - 19,429 - Accumulated other comprehensive loss (1,462 ) (5,730 ) (7,344 ) Retained earnings 753,680 771,335 762,536 Total stockholders' equity 752,241 785,057 755,216 Total liabilities and stockholders' equity $ 819,868 $ 865,490 $ 840,096 POWER INTEGRATIONS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) Three Months Ended Twelve Months Ended December 31,2023 September 30,2023 December 31,2022 December 31,2023 December 31,2022 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 14,271 $ 19,796 $ 22,815 $ 55,735 $ 170,851 Adjustments to reconcile net income to cash provided by operating activities Depreciation 8,887 8,663 8,875 35,203 34,930 Amortization of intangible assets 543 544 544 2,173 2,415 Loss on disposal of property and equipment 14 64 209 100 1,371 Stock-based compensation expense 7,503 6,905 6,654 28,528 22,364 Amortization of premium (accretion of discount) on marketable securities (497 ) (273 ) 654 (351 ) 3,292 Deferred income taxes 705 (7,170 ) 4,824 (9,247 ) (2,566 ) Increase (decrease) in accounts receivable allowance for credit losses - - - (454 ) 690 Change in operating assets and liabilities: Accounts receivable 13,865 3,538 (4,761 ) 6,616 19,867 Inventories (12,918 ) (505 ) (15,328 ) (27,744 ) (36,154 ) Prepaid expenses and other assets (346 ) 6,404 (1,085 ) (1,183 ) 7,343 Accounts payable (2,553 ) (11,695 ) 2,038 (5,435 ) (3,836 ) Taxes payable and other accrued liabilities (13,207 ) 455 (1,341 ) (18,182 ) (5,224 ) Net cash provided by operating activities 16,267 26,726 24,098 65,759 215,343 CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property and equipment (6,143 ) (7,530 ) (5,767 ) (20,884 ) (39,211 ) Proceeds from sale of property and equipment - - - - 1,202 Purchases of marketable securities (18,196 ) (62,205 ) (28,576 ) (191,211 ) (55,820 ) Proceeds from sales and maturities of marketable securities 36,045 63,256 11,151 197,942 172,165 Net cash provided by (used in) investing activities 11,706 (6,479 ) (23,192 ) (14,153 ) 78,336 CASH FLOWS FROM FINANCING ACTIVITIES: Net proceeds from issuance of common stock - 3,139 - 6,237 6,162 Repurchase of common stock (47,444 ) (1,835 ) (18,745 ) (55,278 ) (311,094 ) Payments of dividends to stockholders (11,343 ) (10,904 ) (10,263 ) (44,008 ) (41,492 ) Net cash used in financing activities (58,787 ) (9,600 ) (29,008 ) (93,049 ) (346,424 ) NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (30,814 ) 10,647 (28,102 ) (41,443 ) (52,745 ) CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 94,743 84,096 133,474 105,372 158,117 CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 63,929 $ 94,743 $ 105,372 $ 63,929 $ 105,372 View source version on businesswire.com: https://www.businesswire.com/news/home/20240208131628/en/Contacts Joe Shiffler Power Integrations, Inc. (408) 414-8528 joe@power.com Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. By accessing this page, you agree to the following Privacy Policy and Terms and Conditions.
Power Integrations Reports Fourth-Quarter and Full-Year Financial Results By: Power Integrations, Inc. via Business Wire February 08, 2024 at 16:01 PM EST Quarterly revenues were $89.5 million; GAAP earnings were $0.25 per diluted share; non-GAAP earnings were $0.22 per diluted share Company repurchased 680 thousand shares during the quarter for $47 million Power Integrations (NASDAQ: POWI) today announced financial results for the quarter and year ended December 31, 2023. Net revenues for the fourth quarter were $89.5 million, down 29 percent compared to the prior quarter and down 28 percent from the fourth quarter of 2022. GAAP net income for the fourth quarter was $14.3 million or $0.25 per diluted share compared to $0.34 per diluted share in the prior quarter and $0.40 per diluted share in the fourth quarter of 2022. For the full year, net revenues were $444.5 million, compared to $651.1 million in the prior year. Full-year GAAP net income was $55.7 million or $0.97 per diluted share compared to $2.93 per diluted share in the prior year. Full-year cash flow from operations was $65.8 million. In addition to its GAAP results, the company provided non-GAAP measures that for the fourth quarter of 2023 exclude stock-based compensation, amortization of acquisition-related intangible assets and the related tax effects. Non-GAAP net income for the fourth quarter of 2023 was $12.7 million or $0.22 per diluted share compared to $0.46 per diluted share in the prior quarter and $0.48 per diluted share in the fourth quarter of 2022. For the full year, non-GAAP net income was $74.5 million or $1.29 per diluted share compared to $3.29 per diluted share in the prior year. A reconciliation of GAAP to non-GAAP financial results is included with the tables accompanying this press release. Commented Balu Balakrishnan, chairman and CEO of Power Integrations: “Fourth-quarter revenues declined as expected, and we project first-quarter sales to be about flat sequentially due to continued soft demand and elevated supply-chain inventories. However, channel inventory fell significantly in the fourth quarter, and we expect a further reduction in the first quarter. Based on lower inventories and seasonal patterns we expect sequential revenue growth beginning in the June quarter. We also expect gross margin to rise in the June quarter driven by the dollar/yen exchange rate, higher manufacturing utilization and end-market mix.” During the fourth quarter Power Integrations repurchased 680 thousand shares of its common stock for $47.4 million. The company had $26.0 million remaining on its repurchase authorization as of December 31, 2023. Power Integrations paid a dividend of $0.20 per share on December 29, 2023, and will pay a dividend of $0.20 per share on March 29, 2024, to stockholders of record as of February 29, 2024. Financial Outlook The company issued the following forecast for the first quarter of 2024: Revenues are expected to be $90 million plus or minus $5 million. GAAP gross margin is expected to be approximately 51.5 percent; non-GAAP gross margin is expected to be approximately 52.5 percent. The difference between GAAP and non-GAAP gross margins is equally attributable to stock-based compensation and amortization of acquisition-related intangible assets. GAAP operating expenses are expected to be approximately $49 million; non-GAAP operating expenses are expected to be approximately $42.5 million. Non-GAAP operating expenses are expected to exclude about $6.5 million of stock-based compensation. Conference Call Today at 1:30 p.m. Pacific Time Power Integrations management will hold a conference call today at 1:30 p.m. Pacific time. Members of the investment community can register for the call by visiting the following link: https://registrations.events/direct/Q4I24588. A live webcast of the call will also be available on the investor section of the company's website, http://investors.power.com. About Power Integrations Power Integrations, Inc. is a leading innovator in semiconductor technologies for high-voltage power conversion. The company’s products are key building blocks in the clean-power ecosystem, enabling the generation of renewable energy as well as the efficient transmission and consumption of power in applications ranging from milliwatts to megawatts. For more information, please visit www.power.com. Note Regarding Use of Non-GAAP Financial Measures In addition to the company's consolidated financial statements, which are presented according to GAAP, the company provides certain non-GAAP financial information that excludes stock-based compensation expenses recorded under ASC 718-10, amortization of acquisition-related intangible assets, net other operating expenses of $1.1 million in the second quarter of 2022 stemming from a patent-litigation settlement and an offsetting recovery from the liquidation of SemiSouth Laboratories, and the tax effects of these items. The company uses these measures in its financial and operational decision-making and, with respect to one measure, in setting performance targets for compensation purposes. The company believes that these non-GAAP measures offer important analytical tools to help investors understand its operating results, and to facilitate comparability with the results of companies that provide similar measures. Non-GAAP measures have limitations as analytical tools and are not meant to be considered in isolation or as a substitute for GAAP financial information. For example, stock-based compensation is an important component of the company’s compensation mix and will continue to result in significant expenses in the company’s GAAP results for the foreseeable future but is not reflected in the non-GAAP measures. Also, other companies, including companies in Power Integrations’ industry, may calculate non-GAAP measures differently, limiting their usefulness as comparative measures. Reconciliations of non-GAAP measures to GAAP measures are attached to this press release. Note Regarding Forward-Looking Statements The above statements regarding the company’s forecast for its first-quarter financial performance, sequential growth beginning in the second quarter, channel inventory trends and rising gross margins over the course of the year are forward-looking statements reflecting management's current expectations and beliefs. These statements are based on current information that is, by its nature, subject to rapid and even abrupt change. Due to risks and uncertainties associated with the company's business, actual results could differ materially from those projected or implied by these statements. These risks and uncertainties include, but are not limited to: the company’s ability to supply products and its ability to conduct other aspects of its business such as competing for new design wins; changes in global economic and geopolitical conditions, including such factors as inflation, armed conflicts and trade negotiations, which may impact the level of demand for the company’s products; potential changes and shifts in customer demand away from end products that utilize the company's integrated circuits to end products that do not incorporate the company's products; the effects of competition, which may cause the company’s revenues to decrease or cause the company to decrease its selling prices for its products; unforeseen costs and expenses; and unfavorable fluctuations in component costs or operating expenses resulting from changes in commodity prices and/or exchange rates. In addition, new product introductions and design wins are subject to the risks and uncertainties that typically accompany development and delivery of complex technologies to the marketplace, including product development delays and defects and market acceptance of the new products. These and other risk factors that may cause actual results to differ are more fully explained under the caption “Risk Factors” in the company's most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 7, 2023. The company is under no obligation (and expressly disclaims any obligation) to update or alter its forward-looking statements, whether because of new information, future events or otherwise, except as otherwise required by law. Power Integrations and the Power Integrations logo are trademarks or registered trademarks of Power Integrations, Inc. All other trademarks are property of their respective owners. POWER INTEGRATIONS, INC. CONSOLIDATED STATEMENTS OF INCOME (in thousands, except per-share amounts) Three Months Ended Twelve Months Ended December 31, 2023 September 30, 2023 December 31, 2022 December 31, 2023 December 31, 2022 NET REVENUES $ 89,507 $ 125,511 $ 124,770 $ 444,538 $ 651,138 COST OF REVENUES 43,299 59,566 57,416 215,582 284,231 GROSS PROFIT 46,208 65,945 67,354 228,956 366,907 OPERATING EXPENSES: Research and development 23,505 24,064 23,504 96,067 93,894 Sales and marketing 15,472 16,224 15,493 64,598 62,333 General and administrative 8,282 7,945 7,465 33,232 28,897 Amortization of acquisition-related intangible assets - - - - 241 Other operating expenses, net - - - - 1,130 Total operating expenses 47,259 48,233 46,462 193,897 186,495 INCOME (LOSS) FROM OPERATIONS (1,051 ) 17,712 20,892 35,059 180,412 OTHER INCOME 3,282 3,138 785 10,848 3,014 INCOME BEFORE INCOME TAXES 2,231 20,850 21,677 45,907 183,426 PROVISION (BENEFIT) FOR INCOME TAXES (12,040 ) 1,054 (1,138 ) (9,828 ) 12,575 NET INCOME $ 14,271 $ 19,796 $ 22,815 $ 55,735 $ 170,851 EARNINGS PER SHARE: Basic $ 0.25 $ 0.34 $ 0.40 $ 0.97 $ 2.96 Diluted $ 0.25 $ 0.34 $ 0.40 $ 0.97 $ 2.93 SHARES USED IN PER-SHARE CALCULATION: Basic 56,937 57,383 57,094 57,195 57,801 Diluted 57,272 57,741 57,535 57,622 58,371 SUPPLEMENTAL INFORMATION: Three Months Ended Twelve Months Ended December 31, 2023 September 30, 2023 December 31, 2022 December 31, 2023 December 31, 2022 Stock-based compensation expenses included in: Cost of revenues $ 499 $ 446 $ 405 $ 1,692 $ 1,132 Research and development 2,947 2,895 2,716 10,939 10,428 Sales and marketing 1,827 1,787 1,643 6,888 6,035 General and administrative 2,230 1,777 1,890 9,009 4,769 Total stock-based compensation expense $ 7,503 $ 6,905 $ 6,654 $ 28,528 $ 22,364 Cost of revenues includes: Amortization of acquisition-related intangible assets $ 482 $ 482 $ 482 $ 1,928 $ 1,928 Three Months Ended Twelve Months Ended REVENUE MIX BY END MARKET December 31, 2023 September 30, 2023 December 31, 2022 December 31, 2023 December 31, 2022 Communications 27 % 32 % 23 % 29 % 21 % Computer 9 % 10 % 12 % 12 % 10 % Consumer 29 % 26 % 26 % 27 % 33 % Industrial 35 % 32 % 39 % 32 % 36 % POWER INTEGRATIONS, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP RESULTS (in thousands, except per-share amounts) Three Months Ended Twelve Months Ended December 31,2023 September 30,2023 December 31,2022 December 31,2023 December 31,2022 RECONCILIATION OF GROSS PROFIT GAAP gross profit $ 46,208 $ 65,945 $ 67,354 $ 228,956 $ 366,907 GAAP gross margin 51.6 % 52.5 % 54.0 % 51.5 % 56.3 % Stock-based compensation included in cost of revenues 499 446 405 1,692 1,132 Amortization of acquisition-related intangible assets 482 482 482 1,928 1,928 Non-GAAP gross profit $ 47,189 $ 66,873 $ 68,241 $ 232,576 $ 369,967 Non-GAAP gross margin 52.7 % 53.3 % 54.7 % 52.3 % 56.8 % Three Months Ended Twelve Months Ended RECONCILIATION OF OPERATING EXPENSES December 31,2023 September 30,2023 December 31,2022 December 31,2023 December 31,2022 GAAP operating expenses $ 47,259 $ 48,233 $ 46,462 $ 193,897 $ 186,495 Less: Stock-based compensation expense included in operating expenses Research and development 2,947 2,895 2,716 10,939 10,428 Sales and marketing 1,827 1,787 1,643 6,888 6,035 General and administrative 2,230 1,777 1,890 9,009 4,769 Total 7,004 6,459 6,249 26,836 21,232 Amortization of acquisition-related intangible assets - - - - 241 Other operating expenses, net - - - - 1,130 Non-GAAP operating expenses $ 40,255 $ 41,774 $ 40,213 $ 167,061 $ 163,892 Three Months Ended Twelve Months Ended RECONCILIATION OF INCOME FROM OPERATIONS December 31,2023 September 30,2023 December 31,2022 December 31,2023 December 31,2022 GAAP income (loss) from operations $ (1,051 ) $ 17,712 $ 20,892 $ 35,059 $ 180,412 GAAP operating margin -1.2 % 14.1 % 16.7 % 7.9 % 27.7 % Add: Total stock-based compensation 7,503 6,905 6,654 28,528 22,364 Amortization of acquisition-related intangible assets 482 482 482 1,928 2,169 Other operating expenses, net - - - - 1,130 Non-GAAP income from operations $ 6,934 $ 25,099 $ 28,028 $ 65,515 $ 206,075 Non-GAAP operating margin 7.7 % 20.0 % 22.5 % 14.7 % 31.6 % Three Months Ended Twelve Months Ended RECONCILIATION OF PROVISION FOR INCOME TAXES December 31,2023 September 30,2023 December 31,2022 December 31,2023 December 31,2022 GAAP provision (benefit) for income taxes $ (12,040 ) $ 1,054 $ (1,138 ) $ (9,828 ) $ 12,575 GAAP effective tax rate -539.7 % 5.1 % -5.2 % -21.4 % 6.9 % Tax effect of adjustments to GAAP results (9,556 ) (580 ) (2,085 ) (11,653 ) (4,582 ) Non-GAAP provision (benefit) for income taxes $ (2,484 ) $ 1,634 $ 947 $ 1,825 $ 17,157 Non-GAAP effective tax rate -24.3 % 5.8 % 3.3 % 2.4 % 8.2 % Three Months Ended Twelve Months Ended RECONCILIATION OF NET INCOME PER SHARE (DILUTED) December 31,2023 September 30,2023 December 31,2022 December 31,2023 December 31,2022 GAAP net income $ 14,271 $ 19,796 $ 22,815 $ 55,735 $ 170,851 Adjustments to GAAP net income Stock-based compensation 7,503 6,905 6,654 28,528 22,364 Amortization of acquisition-related intangible assets 482 482 482 1,928 2,169 Other operating expenses, net - - - - 1,130 Tax effect of items excluded from non-GAAP results (9,556 ) (580 ) (2,085 ) (11,653 ) (4,582 ) Non-GAAP net income $ 12,700 $ 26,603 $ 27,866 $ 74,538 $ 191,932 Average shares outstanding for calculation of non-GAAP net income per share (diluted) 57,272 57,741 57,535 57,622 58,371 Non-GAAP net income per share (diluted) $ 0.22 $ 0.46 $ 0.48 $ 1.29 $ 3.29 GAAP net income per share (diluted) $ 0.25 $ 0.34 $ 0.40 $ 0.97 $ 2.93 POWER INTEGRATIONS, INC. CONSOLIDATED BALANCE SHEETS (in thousands) December 31, 2023 September 30, 2023 December 31, 2022 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 63,929 $ 94,743 $ 105,372 Short-term marketable securities 247,640 261,896 248,441 Accounts receivable, net 14,674 28,539 20,836 Inventories 163,164 150,246 135,420 Prepaid expenses and other current assets 22,193 20,692 15,004 Total current assets 511,600 556,116 525,073 PROPERTY AND EQUIPMENT, net 164,213 166,391 176,681 INTANGIBLE ASSETS, net 4,424 4,967 6,597 GOODWILL 91,849 91,849 91,849 DEFERRED TAX ASSETS 28,325 28,943 19,034 OTHER ASSETS 19,457 17,224 20,862 Total assets $ 819,868 $ 865,490 $ 840,096 LIABILITIES AND STOCKHOLDERS’ EQUITY CURRENT LIABILITIES: Accounts payable $ 26,390 $ 28,553 $ 30,088 Accrued payroll and related expenses 13,551 13,778 14,778 Taxes payable 1,016 774 938 Other accrued liabilities 7,910 10,316 12,572 Total current liabilities 48,867 53,421 58,376 LONG-TERM LIABILITIES: Income taxes payable 6,244 16,724 15,757 Other liabilities 12,516 10,288 10,747 Total liabilities 67,627 80,433 84,880 STOCKHOLDERS' EQUITY: Common stock 23 23 24 Additional paid-in capital - 19,429 - Accumulated other comprehensive loss (1,462 ) (5,730 ) (7,344 ) Retained earnings 753,680 771,335 762,536 Total stockholders' equity 752,241 785,057 755,216 Total liabilities and stockholders' equity $ 819,868 $ 865,490 $ 840,096 POWER INTEGRATIONS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) Three Months Ended Twelve Months Ended December 31,2023 September 30,2023 December 31,2022 December 31,2023 December 31,2022 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 14,271 $ 19,796 $ 22,815 $ 55,735 $ 170,851 Adjustments to reconcile net income to cash provided by operating activities Depreciation 8,887 8,663 8,875 35,203 34,930 Amortization of intangible assets 543 544 544 2,173 2,415 Loss on disposal of property and equipment 14 64 209 100 1,371 Stock-based compensation expense 7,503 6,905 6,654 28,528 22,364 Amortization of premium (accretion of discount) on marketable securities (497 ) (273 ) 654 (351 ) 3,292 Deferred income taxes 705 (7,170 ) 4,824 (9,247 ) (2,566 ) Increase (decrease) in accounts receivable allowance for credit losses - - - (454 ) 690 Change in operating assets and liabilities: Accounts receivable 13,865 3,538 (4,761 ) 6,616 19,867 Inventories (12,918 ) (505 ) (15,328 ) (27,744 ) (36,154 ) Prepaid expenses and other assets (346 ) 6,404 (1,085 ) (1,183 ) 7,343 Accounts payable (2,553 ) (11,695 ) 2,038 (5,435 ) (3,836 ) Taxes payable and other accrued liabilities (13,207 ) 455 (1,341 ) (18,182 ) (5,224 ) Net cash provided by operating activities 16,267 26,726 24,098 65,759 215,343 CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property and equipment (6,143 ) (7,530 ) (5,767 ) (20,884 ) (39,211 ) Proceeds from sale of property and equipment - - - - 1,202 Purchases of marketable securities (18,196 ) (62,205 ) (28,576 ) (191,211 ) (55,820 ) Proceeds from sales and maturities of marketable securities 36,045 63,256 11,151 197,942 172,165 Net cash provided by (used in) investing activities 11,706 (6,479 ) (23,192 ) (14,153 ) 78,336 CASH FLOWS FROM FINANCING ACTIVITIES: Net proceeds from issuance of common stock - 3,139 - 6,237 6,162 Repurchase of common stock (47,444 ) (1,835 ) (18,745 ) (55,278 ) (311,094 ) Payments of dividends to stockholders (11,343 ) (10,904 ) (10,263 ) (44,008 ) (41,492 ) Net cash used in financing activities (58,787 ) (9,600 ) (29,008 ) (93,049 ) (346,424 ) NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (30,814 ) 10,647 (28,102 ) (41,443 ) (52,745 ) CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 94,743 84,096 133,474 105,372 158,117 CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 63,929 $ 94,743 $ 105,372 $ 63,929 $ 105,372 View source version on businesswire.com: https://www.businesswire.com/news/home/20240208131628/en/Contacts Joe Shiffler Power Integrations, Inc. (408) 414-8528 joe@power.com
Quarterly revenues were $89.5 million; GAAP earnings were $0.25 per diluted share; non-GAAP earnings were $0.22 per diluted share Company repurchased 680 thousand shares during the quarter for $47 million
Power Integrations (NASDAQ: POWI) today announced financial results for the quarter and year ended December 31, 2023. Net revenues for the fourth quarter were $89.5 million, down 29 percent compared to the prior quarter and down 28 percent from the fourth quarter of 2022. GAAP net income for the fourth quarter was $14.3 million or $0.25 per diluted share compared to $0.34 per diluted share in the prior quarter and $0.40 per diluted share in the fourth quarter of 2022. For the full year, net revenues were $444.5 million, compared to $651.1 million in the prior year. Full-year GAAP net income was $55.7 million or $0.97 per diluted share compared to $2.93 per diluted share in the prior year. Full-year cash flow from operations was $65.8 million. In addition to its GAAP results, the company provided non-GAAP measures that for the fourth quarter of 2023 exclude stock-based compensation, amortization of acquisition-related intangible assets and the related tax effects. Non-GAAP net income for the fourth quarter of 2023 was $12.7 million or $0.22 per diluted share compared to $0.46 per diluted share in the prior quarter and $0.48 per diluted share in the fourth quarter of 2022. For the full year, non-GAAP net income was $74.5 million or $1.29 per diluted share compared to $3.29 per diluted share in the prior year. A reconciliation of GAAP to non-GAAP financial results is included with the tables accompanying this press release. Commented Balu Balakrishnan, chairman and CEO of Power Integrations: “Fourth-quarter revenues declined as expected, and we project first-quarter sales to be about flat sequentially due to continued soft demand and elevated supply-chain inventories. However, channel inventory fell significantly in the fourth quarter, and we expect a further reduction in the first quarter. Based on lower inventories and seasonal patterns we expect sequential revenue growth beginning in the June quarter. We also expect gross margin to rise in the June quarter driven by the dollar/yen exchange rate, higher manufacturing utilization and end-market mix.” During the fourth quarter Power Integrations repurchased 680 thousand shares of its common stock for $47.4 million. The company had $26.0 million remaining on its repurchase authorization as of December 31, 2023. Power Integrations paid a dividend of $0.20 per share on December 29, 2023, and will pay a dividend of $0.20 per share on March 29, 2024, to stockholders of record as of February 29, 2024. Financial Outlook The company issued the following forecast for the first quarter of 2024: Revenues are expected to be $90 million plus or minus $5 million. GAAP gross margin is expected to be approximately 51.5 percent; non-GAAP gross margin is expected to be approximately 52.5 percent. The difference between GAAP and non-GAAP gross margins is equally attributable to stock-based compensation and amortization of acquisition-related intangible assets. GAAP operating expenses are expected to be approximately $49 million; non-GAAP operating expenses are expected to be approximately $42.5 million. Non-GAAP operating expenses are expected to exclude about $6.5 million of stock-based compensation. Conference Call Today at 1:30 p.m. Pacific Time Power Integrations management will hold a conference call today at 1:30 p.m. Pacific time. Members of the investment community can register for the call by visiting the following link: https://registrations.events/direct/Q4I24588. A live webcast of the call will also be available on the investor section of the company's website, http://investors.power.com. About Power Integrations Power Integrations, Inc. is a leading innovator in semiconductor technologies for high-voltage power conversion. The company’s products are key building blocks in the clean-power ecosystem, enabling the generation of renewable energy as well as the efficient transmission and consumption of power in applications ranging from milliwatts to megawatts. For more information, please visit www.power.com. Note Regarding Use of Non-GAAP Financial Measures In addition to the company's consolidated financial statements, which are presented according to GAAP, the company provides certain non-GAAP financial information that excludes stock-based compensation expenses recorded under ASC 718-10, amortization of acquisition-related intangible assets, net other operating expenses of $1.1 million in the second quarter of 2022 stemming from a patent-litigation settlement and an offsetting recovery from the liquidation of SemiSouth Laboratories, and the tax effects of these items. The company uses these measures in its financial and operational decision-making and, with respect to one measure, in setting performance targets for compensation purposes. The company believes that these non-GAAP measures offer important analytical tools to help investors understand its operating results, and to facilitate comparability with the results of companies that provide similar measures. Non-GAAP measures have limitations as analytical tools and are not meant to be considered in isolation or as a substitute for GAAP financial information. For example, stock-based compensation is an important component of the company’s compensation mix and will continue to result in significant expenses in the company’s GAAP results for the foreseeable future but is not reflected in the non-GAAP measures. Also, other companies, including companies in Power Integrations’ industry, may calculate non-GAAP measures differently, limiting their usefulness as comparative measures. Reconciliations of non-GAAP measures to GAAP measures are attached to this press release. Note Regarding Forward-Looking Statements The above statements regarding the company’s forecast for its first-quarter financial performance, sequential growth beginning in the second quarter, channel inventory trends and rising gross margins over the course of the year are forward-looking statements reflecting management's current expectations and beliefs. These statements are based on current information that is, by its nature, subject to rapid and even abrupt change. Due to risks and uncertainties associated with the company's business, actual results could differ materially from those projected or implied by these statements. These risks and uncertainties include, but are not limited to: the company’s ability to supply products and its ability to conduct other aspects of its business such as competing for new design wins; changes in global economic and geopolitical conditions, including such factors as inflation, armed conflicts and trade negotiations, which may impact the level of demand for the company’s products; potential changes and shifts in customer demand away from end products that utilize the company's integrated circuits to end products that do not incorporate the company's products; the effects of competition, which may cause the company’s revenues to decrease or cause the company to decrease its selling prices for its products; unforeseen costs and expenses; and unfavorable fluctuations in component costs or operating expenses resulting from changes in commodity prices and/or exchange rates. In addition, new product introductions and design wins are subject to the risks and uncertainties that typically accompany development and delivery of complex technologies to the marketplace, including product development delays and defects and market acceptance of the new products. These and other risk factors that may cause actual results to differ are more fully explained under the caption “Risk Factors” in the company's most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 7, 2023. The company is under no obligation (and expressly disclaims any obligation) to update or alter its forward-looking statements, whether because of new information, future events or otherwise, except as otherwise required by law. Power Integrations and the Power Integrations logo are trademarks or registered trademarks of Power Integrations, Inc. All other trademarks are property of their respective owners. POWER INTEGRATIONS, INC. CONSOLIDATED STATEMENTS OF INCOME (in thousands, except per-share amounts) Three Months Ended Twelve Months Ended December 31, 2023 September 30, 2023 December 31, 2022 December 31, 2023 December 31, 2022 NET REVENUES $ 89,507 $ 125,511 $ 124,770 $ 444,538 $ 651,138 COST OF REVENUES 43,299 59,566 57,416 215,582 284,231 GROSS PROFIT 46,208 65,945 67,354 228,956 366,907 OPERATING EXPENSES: Research and development 23,505 24,064 23,504 96,067 93,894 Sales and marketing 15,472 16,224 15,493 64,598 62,333 General and administrative 8,282 7,945 7,465 33,232 28,897 Amortization of acquisition-related intangible assets - - - - 241 Other operating expenses, net - - - - 1,130 Total operating expenses 47,259 48,233 46,462 193,897 186,495 INCOME (LOSS) FROM OPERATIONS (1,051 ) 17,712 20,892 35,059 180,412 OTHER INCOME 3,282 3,138 785 10,848 3,014 INCOME BEFORE INCOME TAXES 2,231 20,850 21,677 45,907 183,426 PROVISION (BENEFIT) FOR INCOME TAXES (12,040 ) 1,054 (1,138 ) (9,828 ) 12,575 NET INCOME $ 14,271 $ 19,796 $ 22,815 $ 55,735 $ 170,851 EARNINGS PER SHARE: Basic $ 0.25 $ 0.34 $ 0.40 $ 0.97 $ 2.96 Diluted $ 0.25 $ 0.34 $ 0.40 $ 0.97 $ 2.93 SHARES USED IN PER-SHARE CALCULATION: Basic 56,937 57,383 57,094 57,195 57,801 Diluted 57,272 57,741 57,535 57,622 58,371 SUPPLEMENTAL INFORMATION: Three Months Ended Twelve Months Ended December 31, 2023 September 30, 2023 December 31, 2022 December 31, 2023 December 31, 2022 Stock-based compensation expenses included in: Cost of revenues $ 499 $ 446 $ 405 $ 1,692 $ 1,132 Research and development 2,947 2,895 2,716 10,939 10,428 Sales and marketing 1,827 1,787 1,643 6,888 6,035 General and administrative 2,230 1,777 1,890 9,009 4,769 Total stock-based compensation expense $ 7,503 $ 6,905 $ 6,654 $ 28,528 $ 22,364 Cost of revenues includes: Amortization of acquisition-related intangible assets $ 482 $ 482 $ 482 $ 1,928 $ 1,928 Three Months Ended Twelve Months Ended REVENUE MIX BY END MARKET December 31, 2023 September 30, 2023 December 31, 2022 December 31, 2023 December 31, 2022 Communications 27 % 32 % 23 % 29 % 21 % Computer 9 % 10 % 12 % 12 % 10 % Consumer 29 % 26 % 26 % 27 % 33 % Industrial 35 % 32 % 39 % 32 % 36 % POWER INTEGRATIONS, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP RESULTS (in thousands, except per-share amounts) Three Months Ended Twelve Months Ended December 31,2023 September 30,2023 December 31,2022 December 31,2023 December 31,2022 RECONCILIATION OF GROSS PROFIT GAAP gross profit $ 46,208 $ 65,945 $ 67,354 $ 228,956 $ 366,907 GAAP gross margin 51.6 % 52.5 % 54.0 % 51.5 % 56.3 % Stock-based compensation included in cost of revenues 499 446 405 1,692 1,132 Amortization of acquisition-related intangible assets 482 482 482 1,928 1,928 Non-GAAP gross profit $ 47,189 $ 66,873 $ 68,241 $ 232,576 $ 369,967 Non-GAAP gross margin 52.7 % 53.3 % 54.7 % 52.3 % 56.8 % Three Months Ended Twelve Months Ended RECONCILIATION OF OPERATING EXPENSES December 31,2023 September 30,2023 December 31,2022 December 31,2023 December 31,2022 GAAP operating expenses $ 47,259 $ 48,233 $ 46,462 $ 193,897 $ 186,495 Less: Stock-based compensation expense included in operating expenses Research and development 2,947 2,895 2,716 10,939 10,428 Sales and marketing 1,827 1,787 1,643 6,888 6,035 General and administrative 2,230 1,777 1,890 9,009 4,769 Total 7,004 6,459 6,249 26,836 21,232 Amortization of acquisition-related intangible assets - - - - 241 Other operating expenses, net - - - - 1,130 Non-GAAP operating expenses $ 40,255 $ 41,774 $ 40,213 $ 167,061 $ 163,892 Three Months Ended Twelve Months Ended RECONCILIATION OF INCOME FROM OPERATIONS December 31,2023 September 30,2023 December 31,2022 December 31,2023 December 31,2022 GAAP income (loss) from operations $ (1,051 ) $ 17,712 $ 20,892 $ 35,059 $ 180,412 GAAP operating margin -1.2 % 14.1 % 16.7 % 7.9 % 27.7 % Add: Total stock-based compensation 7,503 6,905 6,654 28,528 22,364 Amortization of acquisition-related intangible assets 482 482 482 1,928 2,169 Other operating expenses, net - - - - 1,130 Non-GAAP income from operations $ 6,934 $ 25,099 $ 28,028 $ 65,515 $ 206,075 Non-GAAP operating margin 7.7 % 20.0 % 22.5 % 14.7 % 31.6 % Three Months Ended Twelve Months Ended RECONCILIATION OF PROVISION FOR INCOME TAXES December 31,2023 September 30,2023 December 31,2022 December 31,2023 December 31,2022 GAAP provision (benefit) for income taxes $ (12,040 ) $ 1,054 $ (1,138 ) $ (9,828 ) $ 12,575 GAAP effective tax rate -539.7 % 5.1 % -5.2 % -21.4 % 6.9 % Tax effect of adjustments to GAAP results (9,556 ) (580 ) (2,085 ) (11,653 ) (4,582 ) Non-GAAP provision (benefit) for income taxes $ (2,484 ) $ 1,634 $ 947 $ 1,825 $ 17,157 Non-GAAP effective tax rate -24.3 % 5.8 % 3.3 % 2.4 % 8.2 % Three Months Ended Twelve Months Ended RECONCILIATION OF NET INCOME PER SHARE (DILUTED) December 31,2023 September 30,2023 December 31,2022 December 31,2023 December 31,2022 GAAP net income $ 14,271 $ 19,796 $ 22,815 $ 55,735 $ 170,851 Adjustments to GAAP net income Stock-based compensation 7,503 6,905 6,654 28,528 22,364 Amortization of acquisition-related intangible assets 482 482 482 1,928 2,169 Other operating expenses, net - - - - 1,130 Tax effect of items excluded from non-GAAP results (9,556 ) (580 ) (2,085 ) (11,653 ) (4,582 ) Non-GAAP net income $ 12,700 $ 26,603 $ 27,866 $ 74,538 $ 191,932 Average shares outstanding for calculation of non-GAAP net income per share (diluted) 57,272 57,741 57,535 57,622 58,371 Non-GAAP net income per share (diluted) $ 0.22 $ 0.46 $ 0.48 $ 1.29 $ 3.29 GAAP net income per share (diluted) $ 0.25 $ 0.34 $ 0.40 $ 0.97 $ 2.93 POWER INTEGRATIONS, INC. CONSOLIDATED BALANCE SHEETS (in thousands) December 31, 2023 September 30, 2023 December 31, 2022 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 63,929 $ 94,743 $ 105,372 Short-term marketable securities 247,640 261,896 248,441 Accounts receivable, net 14,674 28,539 20,836 Inventories 163,164 150,246 135,420 Prepaid expenses and other current assets 22,193 20,692 15,004 Total current assets 511,600 556,116 525,073 PROPERTY AND EQUIPMENT, net 164,213 166,391 176,681 INTANGIBLE ASSETS, net 4,424 4,967 6,597 GOODWILL 91,849 91,849 91,849 DEFERRED TAX ASSETS 28,325 28,943 19,034 OTHER ASSETS 19,457 17,224 20,862 Total assets $ 819,868 $ 865,490 $ 840,096 LIABILITIES AND STOCKHOLDERS’ EQUITY CURRENT LIABILITIES: Accounts payable $ 26,390 $ 28,553 $ 30,088 Accrued payroll and related expenses 13,551 13,778 14,778 Taxes payable 1,016 774 938 Other accrued liabilities 7,910 10,316 12,572 Total current liabilities 48,867 53,421 58,376 LONG-TERM LIABILITIES: Income taxes payable 6,244 16,724 15,757 Other liabilities 12,516 10,288 10,747 Total liabilities 67,627 80,433 84,880 STOCKHOLDERS' EQUITY: Common stock 23 23 24 Additional paid-in capital - 19,429 - Accumulated other comprehensive loss (1,462 ) (5,730 ) (7,344 ) Retained earnings 753,680 771,335 762,536 Total stockholders' equity 752,241 785,057 755,216 Total liabilities and stockholders' equity $ 819,868 $ 865,490 $ 840,096 POWER INTEGRATIONS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) Three Months Ended Twelve Months Ended December 31,2023 September 30,2023 December 31,2022 December 31,2023 December 31,2022 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 14,271 $ 19,796 $ 22,815 $ 55,735 $ 170,851 Adjustments to reconcile net income to cash provided by operating activities Depreciation 8,887 8,663 8,875 35,203 34,930 Amortization of intangible assets 543 544 544 2,173 2,415 Loss on disposal of property and equipment 14 64 209 100 1,371 Stock-based compensation expense 7,503 6,905 6,654 28,528 22,364 Amortization of premium (accretion of discount) on marketable securities (497 ) (273 ) 654 (351 ) 3,292 Deferred income taxes 705 (7,170 ) 4,824 (9,247 ) (2,566 ) Increase (decrease) in accounts receivable allowance for credit losses - - - (454 ) 690 Change in operating assets and liabilities: Accounts receivable 13,865 3,538 (4,761 ) 6,616 19,867 Inventories (12,918 ) (505 ) (15,328 ) (27,744 ) (36,154 ) Prepaid expenses and other assets (346 ) 6,404 (1,085 ) (1,183 ) 7,343 Accounts payable (2,553 ) (11,695 ) 2,038 (5,435 ) (3,836 ) Taxes payable and other accrued liabilities (13,207 ) 455 (1,341 ) (18,182 ) (5,224 ) Net cash provided by operating activities 16,267 26,726 24,098 65,759 215,343 CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property and equipment (6,143 ) (7,530 ) (5,767 ) (20,884 ) (39,211 ) Proceeds from sale of property and equipment - - - - 1,202 Purchases of marketable securities (18,196 ) (62,205 ) (28,576 ) (191,211 ) (55,820 ) Proceeds from sales and maturities of marketable securities 36,045 63,256 11,151 197,942 172,165 Net cash provided by (used in) investing activities 11,706 (6,479 ) (23,192 ) (14,153 ) 78,336 CASH FLOWS FROM FINANCING ACTIVITIES: Net proceeds from issuance of common stock - 3,139 - 6,237 6,162 Repurchase of common stock (47,444 ) (1,835 ) (18,745 ) (55,278 ) (311,094 ) Payments of dividends to stockholders (11,343 ) (10,904 ) (10,263 ) (44,008 ) (41,492 ) Net cash used in financing activities (58,787 ) (9,600 ) (29,008 ) (93,049 ) (346,424 ) NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (30,814 ) 10,647 (28,102 ) (41,443 ) (52,745 ) CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 94,743 84,096 133,474 105,372 158,117 CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 63,929 $ 94,743 $ 105,372 $ 63,929 $ 105,372 View source version on businesswire.com: https://www.businesswire.com/news/home/20240208131628/en/