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, 2022 | September 30, 2022 | December 31, 2021 | December 31, 2022 | December 31, 2021 | |||||||||||||||
| NET REVENUES | $ |
124,770 |
|
$ |
160,233 |
|
$ |
172,654 |
|
$ |
651,138 |
|
$ |
703,277 |
|
||||
| COST OF REVENUES |
|
57,416 |
|
|
68,198 |
|
|
79,478 |
|
|
284,231 |
|
|
342,638 |
|
||||
| GROSS PROFIT |
|
67,354 |
|
|
92,035 |
|
|
93,176 |
|
|
366,907 |
|
|
360,639 |
|
||||
| OPERATING EXPENSES: | |||||||||||||||||||
| Research and development |
|
23,504 |
|
|
23,205 |
|
|
22,028 |
|
|
93,894 |
|
|
84,933 |
|
||||
| Sales and marketing |
|
15,493 |
|
|
14,700 |
|
|
15,590 |
|
|
62,333 |
|
|
60,037 |
|
||||
| General and administrative |
|
7,465 |
|
|
5,759 |
|
|
11,073 |
|
|
28,897 |
|
|
39,840 |
|
||||
| Amortization of acquisition-related intangible assets |
|
- |
|
|
- |
|
|
181 |
|
|
241 |
|
|
771 |
|
||||
| Other operating expenses, net |
|
- |
|
|
- |
|
|
- |
|
|
1,130 |
|
|
- |
|
||||
| Total operating expenses |
|
46,462 |
|
|
43,664 |
|
|
48,872 |
|
|
186,495 |
|
|
185,581 |
|
||||
| INCOME FROM OPERATIONS |
|
20,892 |
|
|
48,371 |
|
|
44,304 |
|
|
180,412 |
|
|
175,058 |
|
||||
| OTHER INCOME |
|
785 |
|
|
1,001 |
|
|
101 |
|
|
3,014 |
|
|
1,077 |
|
||||
| INCOME BEFORE INCOME TAXES |
|
21,677 |
|
|
49,372 |
|
|
44,405 |
|
|
183,426 |
|
|
176,135 |
|
||||
| PROVISION (BENEFIT) FOR INCOME TAXES |
|
(1,138 |
) |
|
3,408 |
|
|
3,705 |
|
|
12,575 |
|
|
11,722 |
|
||||
| NET INCOME | $ |
22,815 |
|
$ |
45,964 |
|
$ |
40,700 |
|
$ |
170,851 |
|
$ |
164,413 |
|
||||
| EARNINGS PER SHARE: | |||||||||||||||||||
| Basic | $ |
0.40 |
|
$ |
0.80 |
|
$ |
0.68 |
|
$ |
2.96 |
|
$ |
2.73 |
|
||||
| Diluted | $ |
0.40 |
|
$ |
0.80 |
|
$ |
0.66 |
|
$ |
2.93 |
|
$ |
2.67 |
|
||||
| SHARES USED IN PER-SHARE CALCULATION: | |||||||||||||||||||
| Basic |
|
57,094 |
|
|
57,172 |
|
|
60,259 |
|
|
57,801 |
|
|
60,327 |
|
||||
| Diluted |
|
57,535 |
|
|
57,603 |
|
|
61,381 |
|
|
58,371 |
|
|
61,467 |
|
||||
| SUPPLEMENTAL INFORMATION: | Three Months Ended | Twelve Months Ended | |||||||||||||||||
| December 31, 2022 | September 30, 2022 | December 31, 2021 | December 31, 2022 | December 31, 2021 | |||||||||||||||
| Stock-based compensation expenses included in: | |||||||||||||||||||
| Cost of revenues | $ |
405 |
|
$ |
172 |
|
$ |
424 |
|
$ |
1,132 |
|
$ |
2,359 |
|
||||
| Research and development |
|
2,716 |
|
|
2,334 |
|
|
3,522 |
|
|
10,428 |
|
|
12,127 |
|
||||
| Sales and marketing |
|
1,643 |
|
|
1,267 |
|
|
2,090 |
|
|
6,035 |
|
|
7,630 |
|
||||
| General and administrative |
|
1,890 |
|
|
(755 |
) |
|
4,248 |
|
|
4,769 |
|
|
15,493 |
|
||||
| Total stock-based compensation expense | $ |
6,654 |
|
$ |
3,018 |
|
$ |
10,284 |
|
$ |
22,364 |
|
$ |
37,609 |
|
||||
| Cost of revenues includes: | |||||||||||||||||||
| Amortization of acquisition-related intangible assets | $ |
482 |
|
$ |
482 |
|
$ |
552 |
|
$ |
1,928 |
|
$ |
2,477 |
|
||||
| Three Months Ended | Twelve Months Ended | ||||||||||||||||||
| REVENUE MIX BY END MARKET | December 31, 2022 | September 30, 2022 | December 31, 2021 | December 31, 2022 | December 31, 2021 | ||||||||||||||
| Communications |
|
23 |
% |
|
16 |
% |
|
23 |
% |
|
21 |
% |
|
30 |
% |
||||
| Computer |
|
12 |
% |
|
11 |
% |
|
10 |
% |
|
10 |
% |
|
10 |
% |
||||
| Consumer |
|
26 |
% |
|
32 |
% |
|
35 |
% |
|
33 |
% |
|
32 |
% |
||||
| Industrial |
|
39 |
% |
|
41 |
% |
|
32 |
% |
|
36 |
% |
|
28 |
% |
||||
| 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, 2022 | September 30, 2022 | December 31, 2021 | December 31, 2022 | December 31, 2021 | ||||||||||||||||
| RECONCILIATION OF GROSS PROFIT | ||||||||||||||||||||
| GAAP gross profit | $ |
67,354 |
|
$ |
92,035 |
|
$ |
93,176 |
|
$ |
366,907 |
|
$ |
360,639 |
|
|||||
| GAAP gross margin |
|
54.0 |
% |
|
57.4 |
% |
|
54.0 |
% |
|
56.3 |
% |
|
51.3 |
% |
|||||
| Stock-based compensation included in cost of revenues |
|
405 |
|
|
172 |
|
|
424 |
|
|
1,132 |
|
|
2,359 |
|
|||||
| Amortization of acquisition-related intangible assets |
|
482 |
|
|
482 |
|
|
552 |
|
|
1,928 |
|
|
2,477 |
|
|||||
| Non-GAAP gross profit | $ |
68,241 |
|
$ |
92,689 |
|
$ |
94,152 |
|
$ |
369,967 |
|
$ |
365,475 |
|
|||||
| Non-GAAP gross margin |
|
54.7 |
% |
|
57.8 |
% |
|
54.5 |
% |
|
56.8 |
% |
|
52.0 |
% |
|||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||
| RECONCILIATION OF OPERATING EXPENSES | December 31, 2022 | September 30, 2022 | December 31, 2021 | December 31, 2022 | December 31, 2021 | |||||||||||||||
| GAAP operating expenses | $ |
46,462 |
|
$ |
43,664 |
|
$ |
48,872 |
|
$ |
186,495 |
|
$ |
185,581 |
|
|||||
| Less: | Stock-based compensation expense included in operating expenses | |||||||||||||||||||
| Research and development |
|
2,716 |
|
|
2,334 |
|
|
3,522 |
|
|
10,428 |
|
|
12,127 |
|
|||||
| Sales and marketing |
|
1,643 |
|
|
1,267 |
|
|
2,090 |
|
|
6,035 |
|
|
7,630 |
|
|||||
| General and administrative |
|
1,890 |
|
|
(755 |
) |
|
4,248 |
|
|
4,769 |
|
|
15,493 |
|
|||||
| Total |
|
6,249 |
|
|
2,846 |
|
|
9,860 |
|
|
21,232 |
|
|
35,250 |
|
|||||
| Amortization of acquisition-related intangible assets |
|
- |
|
|
- |
|
|
181 |
|
|
241 |
|
|
771 |
|
|||||
| Other operating expenses, net |
|
- |
|
|
- |
|
|
- |
|
|
1,130 |
|
|
- |
|
|||||
| Non-GAAP operating expenses | $ |
40,213 |
|
$ |
40,818 |
|
$ |
38,831 |
|
$ |
163,892 |
|
$ |
149,560 |
|
|||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||
| RECONCILIATION OF INCOME FROM OPERATIONS | December 31, 2022 | September 30, 2022 | December 31, 2021 | December 31, 2022 | December 31, 2021 | |||||||||||||||
| GAAP income from operations | $ |
20,892 |
|
$ |
48,371 |
|
$ |
44,304 |
|
$ |
180,412 |
|
$ |
175,058 |
|
|||||
| GAAP operating margin |
|
16.7 |
% |
|
30.2 |
% |
|
25.7 |
% |
|
27.7 |
% |
|
24.9 |
% |
|||||
| Add: | Total stock-based compensation |
|
6,654 |
|
|
3,018 |
|
|
10,284 |
|
|
22,364 |
|
|
37,609 |
|
||||
| Amortization of acquisition-related intangible assets |
|
482 |
|
|
482 |
|
|
733 |
|
|
2,169 |
|
|
3,248 |
|
|||||
| Other operating expenses, net |
|
- |
|
|
- |
|
|
- |
|
|
1,130 |
|
|
- |
|
|||||
| Non-GAAP income from operations | $ |
28,028 |
|
$ |
51,871 |
|
$ |
55,321 |
|
$ |
206,075 |
|
$ |
215,915 |
|
|||||
| Non-GAAP operating margin |
|
22.5 |
% |
|
32.4 |
% |
|
32.0 |
% |
|
31.6 |
% |
|
30.7 |
% |
|||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||
| RECONCILIATION OF PROVISION (BENEFIT) FOR INCOME TAXES | December 31, 2022 | September 30, 2022 | December 31, 2021 | December 31, 2022 | December 31, 2021 | |||||||||||||||
| GAAP provision (benefit) for income taxes | $ |
(1,138 |
) |
$ |
3,408 |
|
$ |
3,705 |
|
$ |
12,575 |
|
$ |
11,722 |
|
|||||
| GAAP effective tax rate |
|
-5.2 |
% |
|
6.9 |
% |
|
8.3 |
% |
|
6.9 |
% |
|
6.7 |
% |
|||||
| Tax effect of adjustments to GAAP results |
|
(2,085 |
) |
|
(1,116 |
) |
|
(800 |
) |
|
(4,582 |
) |
|
(5,044 |
) |
|||||
| Non-GAAP provision for income taxes | $ |
947 |
|
$ |
4,524 |
|
$ |
4,505 |
|
$ |
17,157 |
|
$ |
16,766 |
|
|||||
| Non-GAAP effective tax rate |
|
3.3 |
% |
|
8.6 |
% |
|
8.1 |
% |
|
8.2 |
% |
|
7.7 |
% |
|||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||
| RECONCILIATION OF NET INCOME PER SHARE (DILUTED) | December 31, 2022 | September 30, 2022 | December 31, 2021 | December 31, 2022 | December 31, 2021 | |||||||||||||||
| GAAP net income | $ |
22,815 |
|
$ |
45,964 |
|
$ |
40,700 |
|
$ |
170,851 |
|
$ |
164,413 |
|
|||||
| Adjustments to GAAP net income | ||||||||||||||||||||
| Stock-based compensation |
|
6,654 |
|
|
3,018 |
|
|
10,284 |
|
|
22,364 |
|
|
37,609 |
|
|||||
| Amortization of acquisition-related intangible assets |
|
482 |
|
|
482 |
|
|
733 |
|
|
2,169 |
|
|
3,248 |
|
|||||
| Other operating expenses, net |
|
- |
|
|
- |
|
|
- |
|
|
1,130 |
|
|
- |
|
|||||
| Tax effect of items excluded from non-GAAP results |
|
(2,085 |
) |
|
(1,116 |
) |
|
(800 |
) |
|
(4,582 |
) |
|
(5,044 |
) |
|||||
| Non-GAAP net income | $ |
27,866 |
|
$ |
48,348 |
|
$ |
50,917 |
|
$ |
191,932 |
|
$ |
200,226 |
|
|||||
| Average shares outstanding for calculation | ||||||||||||||||||||
| of non-GAAP net income per share (diluted) |
|
57,535 |
|
|
57,603 |
|
|
61,381 |
|
|
58,371 |
|
|
61,467 |
|
|||||
| Non-GAAP net income per share (diluted) | $ |
0.48 |
|
$ |
0.84 |
|
$ |
0.83 |
|
$ |
3.29 |
|
$ |
3.26 |
|
|||||
| GAAP net income per share (diluted) | $ |
0.40 |
|
$ |
0.80 |
|
$ |
0.66 |
|
$ |
2.93 |
|
$ |
2.67 |
|
|||||
| POWER INTEGRATIONS, INC. | |||||||||||
| CONSOLIDATED BALANCE SHEETS | |||||||||||
| (in thousands) | |||||||||||
| December 31, 2022 | September 30, 2022 | December 31, 2021 | |||||||||
| ASSETS | |||||||||||
| CURRENT ASSETS: | |||||||||||
| Cash and cash equivalents | $ |
105,372 |
|
$ |
133,474 |
|
$ |
158,117 |
|
||
| Short-term marketable securities |
|
248,441 |
|
|
229,754 |
|
|
372,235 |
|
||
| Accounts receivable, net |
|
20,836 |
|
|
16,075 |
|
|
41,393 |
|
||
| Inventories |
|
135,420 |
|
|
120,092 |
|
|
99,266 |
|
||
| Prepaid expenses and other current assets |
|
15,004 |
|
|
12,634 |
|
|
15,804 |
|
||
| Total current assets |
|
525,073 |
|
|
512,029 |
|
|
686,815 |
|
||
| PROPERTY AND EQUIPMENT, net |
|
176,681 |
|
|
181,224 |
|
|
179,824 |
|
||
| INTANGIBLE ASSETS, net |
|
6,597 |
|
|
7,141 |
|
|
9,012 |
|
||
| GOODWILL |
|
91,849 |
|
|
91,849 |
|
|
91,849 |
|
||
| DEFERRED TAX ASSETS |
|
19,034 |
|
|
23,935 |
|
|
16,433 |
|
||
| OTHER ASSETS |
|
20,862 |
|
|
21,785 |
|
|
30,554 |
|
||
| Total assets | $ |
840,096 |
|
$ |
837,963 |
|
$ |
1,014,487 |
|
||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
| CURRENT LIABILITIES: | |||||||||||
| Accounts payable | $ |
30,088 |
|
$ |
29,521 |
|
$ |
43,721 |
|
||
| Accrued payroll and related expenses |
|
14,778 |
|
|
13,765 |
|
|
15,492 |
|
||
| Taxes payable |
|
938 |
|
|
2,960 |
|
|
1,210 |
|
||
| Other accrued liabilities |
|
12,572 |
|
|
12,613 |
|
|
11,898 |
|
||
| Total current liabilities |
|
58,376 |
|
|
58,859 |
|
|
72,321 |
|
||
| LONG-TERM LIABILITIES: | |||||||||||
| Income taxes payable |
|
15,757 |
|
|
16,398 |
|
|
15,280 |
|
||
| Other liabilities |
|
10,747 |
|
|
12,424 |
|
|
14,854 |
|
||
| Total liabilities |
|
84,880 |
|
|
87,681 |
|
|
102,455 |
|
||
| STOCKHOLDERS' EQUITY: | |||||||||||
| Common stock |
|
24 |
|
|
24 |
|
|
28 |
|
||
| Additional paid-in capital |
|
- |
|
|
6,123 |
|
|
162,301 |
|
||
| Accumulated other comprehensive loss |
|
(7,344 |
) |
|
(11,817 |
) |
|
(3,737 |
) |
||
| Retained earnings |
|
762,536 |
|
|
755,952 |
|
|
753,440 |
|
||
| Total stockholders' equity |
|
755,216 |
|
|
750,282 |
|
|
912,032 |
|
||
| Total liabilities and stockholders' equity | $ |
840,096 |
|
$ |
837,963 |
|
$ |
1,014,487 |
|
||
| POWER INTEGRATIONS, INC. | |||||||||||||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||||||||
| (in thousands) | |||||||||||||||||||
| Three Months Ended | Twelve Months Ended | ||||||||||||||||||
| December 31, 2022 | September 30, 2022 | December 31, 2021 | December 31, 2022 | December 31, 2021 | |||||||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||||||||||||||
| Net income | $ |
22,815 |
|
$ |
45,964 |
|
$ |
40,700 |
|
$ |
170,851 |
|
$ |
164,413 |
|
||||
| Adjustments to reconcile net income to cash provided by operating activities | |||||||||||||||||||
| Depreciation |
|
8,875 |
|
|
8,881 |
|
|
8,054 |
|
|
34,930 |
|
|
31,454 |
|
||||
| Amortization of intangible assets |
|
544 |
|
|
543 |
|
|
795 |
|
|
2,415 |
|
|
3,494 |
|
||||
| Loss on disposal of property and equipment |
|
209 |
|
|
128 |
|
|
905 |
|
|
1,371 |
|
|
3,105 |
|
||||
| Stock-based compensation expense |
|
6,654 |
|
|
3,018 |
|
|
10,284 |
|
|
22,364 |
|
|
37,609 |
|
||||
| Amortization of premium on marketable securities |
|
654 |
|
|
771 |
|
|
815 |
|
|
3,292 |
|
|
1,590 |
|
||||
| Deferred income taxes |
|
4,824 |
|
|
(4,108 |
) |
|
(13,228 |
) |
|
(2,566 |
) |
|
(13,240 |
) |
||||
| Increase in accounts receivable allowance for credit losses |
|
- |
|
|
431 |
|
|
1 |
|
|
690 |
|
|
18 |
|
||||
| Change in operating assets and liabilities: | |||||||||||||||||||
| Accounts receivable |
|
(4,761 |
) |
|
11,474 |
|
|
(2,522 |
) |
|
19,867 |
|
|
(5,501 |
) |
||||
| Inventories |
|
(15,328 |
) |
|
(8,834 |
) |
|
(7,452 |
) |
|
(36,154 |
) |
|
3,612 |
|
||||
| Prepaid expenses and other assets |
|
(1,085 |
) |
|
4,353 |
|
|
9,299 |
|
|
7,343 |
|
|
4,326 |
|
||||
| Accounts payable |
|
2,038 |
|
|
(11,451 |
) |
|
(2,566 |
) |
|
(3,836 |
) |
|
4,067 |
|
||||
| Taxes payable and other accrued liabilities |
|
(1,341 |
) |
|
(1,344 |
) |
|
2,078 |
|
|
(5,224 |
) |
|
(4,079 |
) |
||||
| Net cash provided by operating activities |
|
24,098 |
|
|
49,826 |
|
|
47,163 |
|
|
215,343 |
|
|
230,868 |
|
||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||||||||||||||
| Purchases of property and equipment |
|
(5,767 |
) |
|
(5,500 |
) |
|
(16,967 |
) |
|
(39,211 |
) |
|
(47,272 |
) |
||||
| Proceeds from sale of property and equipment |
|
- |
|
|
- |
|
|
- |
|
|
1,202 |
|
|
35 |
|
||||
| Purchases of marketable securities |
|
(28,576 |
) |
|
(6,534 |
) |
|
(172,115 |
) |
|
(55,820 |
) |
|
(554,018 |
) |
||||
| Proceeds from sales and maturities of marketable securities |
|
11,151 |
|
|
35,487 |
|
|
84,421 |
|
|
172,165 |
|
|
368,457 |
|
||||
| Net cash provided by (used in) investing activities |
|
(23,192 |
) |
|
23,453 |
|
|
(104,661 |
) |
|
78,336 |
|
|
(232,798 |
) |
||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||||||||||||||
| Net proceeds from issuance of common stock |
|
- |
|
|
3,105 |
|
|
- |
|
|
6,162 |
|
|
7,710 |
|
||||
| Repurchase of common stock |
|
(18,745 |
) |
|
- |
|
|
(37,773 |
) |
|
(311,094 |
) |
|
(73,938 |
) |
||||
| Payments of dividends to stockholders |
|
(10,263 |
) |
|
(10,293 |
) |
|
(9,047 |
) |
|
(41,492 |
) |
|
(32,599 |
) |
||||
| Net cash used in financing activities |
|
(29,008 |
) |
|
(7,188 |
) |
|
(46,820 |
) |
|
(346,424 |
) |
|
(98,827 |
) |
||||
| NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS |
|
(28,102 |
) |
|
66,091 |
|
|
(104,318 |
) |
|
(52,745 |
) |
|
(100,757 |
) |
||||
| CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD |
|
133,474 |
|
|
67,383 |
|
|
262,435 |
|
|
158,117 |
|
|
258,874 |
|
||||
| CASH AND CASH EQUIVALENTS AT END OF PERIOD | $ |
105,372 |
|
$ |
133,474 |
|
$ |
158,117 |
|
$ |
105,372 |
|
$ |
158,117 |
|
||||
