Earnings Exceed Guidance

AUSTIN, Texas — (BUSINESS WIRE) — February 3, 2016 — 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, 2016. Revenue in the fourth quarter was at the high end of guidance at $160.1 million, up from $156.2 million in the third quarter. Fourth quarter non-GAAP earnings per share exceeded the high end of guidance at $0.63.

Fourth Quarter Financial Highlights

• IoT revenue exceeded expectations, increasing to $67.2 million, or 2.8% sequentially
• Infrastructure revenue declined slightly to $30.6 million, or 1.5% sequentially
• Broadcast revenue increased to $39.7 million, or 8.7% sequentially
• Access revenue declined to $22.6 million, or 3.0% sequentially

On a GAAP basis:

• Gross margin was 58.4 percent
• R&D expenses were $47.2 million
• SG&A expenses were $41.5 million
• Operating income as a percentage of revenue was 3.0 percent
• Diluted earnings per share were $0.13

On a non-GAAP basis (results exclude the impact of stock compensation, amortization of acquired intangible assets and certain other items as set forth in the reconciliation tables below):

• Gross margin was 59.0 percent
• R&D expenses were $36.4 million
• SG&A expenses were $31.4 million
• Operating income as a percentage of revenue was 16.6 percent
• Diluted earnings per share were $0.63

Product Highlights

• Announced broad support for ARM® mbed OS within the EFM32™ Gecko MCU portfolio, providing best-in-class energy efficiency and design simplicity for embedded developers.
• Introduced next-generation EFM32 Pearl and Jade Gecko MCU families, providing advancements in security and energy management technologies.
• Announced the EFM8™ Laser Bee family, delivering the highest analog performance and peripheral integration in the 8-bit market.
• Introduced turnkey connected home reference designs that reduce the complexity of linking devices such as lights, dimmer switches, and door or window contact sensors.
• Released the industry’s most cost-effective reference design solution for voice-enabled ZigBee® remote controls for home entertainment systems.
• Announced the TouchXpress™ family of fixed-function controllers, providing the fastest, easiest way to add low-power capacitive touch interfaces to embedded designs.
• Introduced a free software tool that enables engineers to quickly and easily measure PCI Express® clock jitter to verify PCIe® specification compliance.
• Launched the Si86xxxT family of multi-channel digital isolators, providing robust protection against lightning strikes and exceptional reliability for demanding industrial systems.

Business Highlights

• Acquired Telegesis, a leading supplier of wireless mesh networking modules based on Silicon Labs’ market-leading ZigBee silicon and software.
• Won the Global Semiconductor Alliance’s (GSA) Most Respected Public Semiconductor Company award for companies achieving $500 million to $1 billion in annual sales.
• Won a coveted Elektra Award in the Design Tools and Development Software category for the Simplicity Studio™ development platform.
• Supplied enabling Thread technology for dozens of connected home products that debuted at the 2016 Consumer Electronics Show .