Cirrus Logic, Inc. (Nasdaq: CRUS), a leader in high-precision
analog and digital signal processing components, today announced
financial results for the first quarter of fiscal year 2011, which
ended June 26, 2010.
Revenue for the quarter was $81.9, up 118 percent compared to
$37.5 million during the first quarter of fiscal year 2010, and up
31% from $62.6 million in the previous quarter. Gross margin for
the quarter was 57 percent, up from 52 percent in the first quarter
a year ago, and up from 56 percent for the previous quarter.
Total GAAP operating expenses for the quarter were approximately
$29.2 million, up from $27 million in the previous quarter.
Research and Development (R&D) investment for the quarter was
$15.1 million, and Selling, General and Administrative (SG&A)
expenses totaled $14 million. These expenses include charges of
$1.3 million for stock-based compensation, $400,000 in
acquisition-related amortization of intangibles, and an $800,000
charge related to the reorganization of the international sales
force. Income from operations on a GAAP basis was approximately
$17.5 million, or a 21 percent operating margin.
Non-GAAP operating expenses for the quarter were approximately
$26.6 million, resulting in non-GAAP income from operations of
$20.2 million, or a 25 percent operating margin. In the previous
quarter, non-GAAP operating expenses were $24.9 million, with
non-GAAP income from operations of $10.5 million, or a 17 percent
operating margin.
GAAP net income for the quarter was approximately $17.6 million
or $0.25 per share based on 70.8 million average diluted shares
outstanding. Excluding the items noted previously, non-GAAP net
income was $20.3 million, or $0.29 per diluted share.
“We are extremely pleased with our Q1 financial results as
revenue growth in portable audio was supported by revenue growth
from several other audio and energy-related product lines,” said
Jason Rhode, president and chief executive officer, Cirrus Logic.
“With a great second quarter ahead of us, and our newly released
products being very well received by customers, we believe that the
future for Cirrus Logic remains very bright.”
Outlook for Second Quarter FY 2011 (ending September
25, 2010):
- Revenue is expected to range
between $98 million and $106 million;
- Gross margin is expected to be
between 56 percent and 58 percent; and
- Combined R&D and SG&A
expenses are expected to range between $28 million and $30 million,
which include approximately $1.7 million in share-based
compensation and amortization of acquisition-related intangibles
expenses.
Conference Call
Cirrus Logic management will hold a conference call to discuss
the company’s results for the first quarter fiscal year 2011, on
July 20, 2010 at 10:30 a.m. EDT. Those wishing to join should call
(480) 629-9690, or toll-free at (866) 225-8754 (Conference ID:
4328597) by 10:20 a.m. on July 20, 2010. A replay of the conference
call will also be available beginning one hour after the completion
of the call, until July 27, 2010. To access the recording, call
(303) 590-3030, or toll-free at (800) 406-7325 (Conference ID:
4328597). A live and an archived webcast of the conference call
will also be available via the Investor section of the company’s
website at www.cirrus.com.
Shareholders who would like to submit a question to be addressed
during the call are requested to contact
investor.relations@cirrus.com.
Cirrus Logic, Inc.
Cirrus Logic develops high-precision, analog and mixed-signal
integrated circuits for a broad range of innovative customers.
Building on its diverse analog and signal-processing patent
portfolio, Cirrus Logic delivers highly optimized products for a
variety of audio and energy-related applications. The company
operates from headquarters in Austin, Texas, with offices in
Tucson, Ariz., Europe, Japan and Asia. More information about
Cirrus Logic is available at www.cirrus.com.
Use of non-GAAP Financial Information
To supplement Cirrus Logic's financial statements presented on a
GAAP basis, Cirrus has provided non-GAAP financial information,
including non-GAAP operating expenses, non-GAAP net income,
non-GAAP net income from operations, non-GAAP operating margin and
non-GAAP diluted earnings per share. 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. 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.
Safe Harbor Statement
Except for historical information contained herein, the matters
set forth in this news release contain forward-looking statements,
including our estimates of second quarter fiscal year 2011 revenue,
gross margin, combined research and development and selling,
general and administrative expense levels, share-based compensation
expense, and amortization of acquired intangible expenses. 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. These risks and uncertainties
include, but are not limited to, the following: overall economic
pressures and general market and economic conditions; overall
conditions in the semiconductor market; the level of orders and
shipments during the second quarter of fiscal year 2011, as well as
customer cancellations of orders, or the failure to place orders
consistent with forecasts; the loss of a key customer; pricing
pressures; and the risk factors listed in our Form 10-K for the
year ended March 27, 2010, 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 undertake no obligation to update or revise any
forward-looking statements, whether as a result of new developments
or otherwise.
Cirrus Logic and Cirrus are trademarks of Cirrus Logic Inc.
CIRRUS LOGIC, INC. CONSOLIDATED CONDENSED
STATEMENT OF OPERATIONS (unaudited) (in thousands,
except per share data) Three Months
Ended Jun. 26, Mar. 27, Jun. 27,
2010 2010 2009 Q1'11 Q4'10
Q1'10 Audio products $ 53,988 $ 40,540 $ 24,787 Energy
products 27,927 22,099 12,727
Net revenue 81,915 62,639
37,514 Cost of sales 35,180
27,355 17,927
Gross Profit
46,735 35,284 19,587 Operating
expenses: Research and development 15,092 13,724 12,508 Selling,
general and administrative 14,011 12,678 10,071 Restructuring and
other costs - 572 - Provision for litigation expenses and
settlements 135 - (2,745 ) Total
operating expenses 29,238 26,974 19,834
Operating income (loss) 17,497
8,310 (247 ) Interest income, net 228
237 463 Other income (expense), net 32 (20 )
(18 )
Income before income taxes 17,757 8,527
198 Provision (benefit) for income taxes 155
(11,831 ) (23 )
Net income $ 17,602
$ 20,358 $ 221
Basic income (loss) per share: $ 0.26 $ 0.31 $ - Diluted income
(loss) per share: $ 0.25 $ 0.31 $ - Weighted average number
of shares: Basic 66,639 65,517 65,254 Diluted 70,755 66,595 65,341
Prepared in accordance with Generally Accepted Accounting
Principles
CIRRUS LOGIC, INC.
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 Jun. 26,
Mar. 27, Jun. 27, 2010 2010 2009
Net Income Reconciliation
Q1'11 Q4'10 Q1'10
GAAP Net Income $ 17,602 $
20,358 $ 221 Amortization of acquisition
intangibles 370 404 404 Stock based compensation expense 1,356
1,181 1,353 Facility Related adjustments 4 - (22 ) International
sales reorganization charges 790 - - Provision for litigation
expenses and settlements 135 - (2,745 ) Restructuring and other
costs, net - 572 - Provision (benefit) for income taxes -
(11,838 ) -
Non-GAAP Net Income
(Loss) $ 20,257 $ 10,677
$ (789 ) Earnings Per Share
reconciliation
GAAP Diluted income per share $
0.25 $ 0.31 $ - Effect of
Amortization of acquisition intangibles 0.01 - 0.01 Effect of Stock
based compensation expense 0.02 0.02 0.02 Effect of Facility
Related adjustments - - - Effect of International sales
reorganization charges 0.01 - - Effect of Provision for litigation
expenses and settlements - - (0.04 ) Effect of Restructuring and
other costs, net - 0.01 - Effect of Provision (benefit) for income
taxes - (0.18 ) -
Non-GAAP Diluted income
(loss) per share $ 0.29 $
0.16 $ (0.01 ) Operating
Income Reconciliation
GAAP Operating Income (Loss) $
17,497 $ 8,310 $ (247 )
GAAP Operating Margin 21 % 13 % -1 % Amortization of acquisition
intangibles 370 404 404 Stock compensation expense - COGS 55 61 52
Stock compensation expense - R&D 521 501 514 Stock compensation
expense - SG&A 780 619 787 Facility Related adjustments 4 - (22
) International sales reorganization charges 790 - - Provision for
litigation expenses and settlements 135 - (2,745 ) Restructuring
and other costs, net - 572 -
Non-GAAP Operating Income (Loss) $
20,152 $ 10,467 $
(1,257 ) Non-GAAP Operating Margin 25 % 17 % -3 %
Operating Expense Reconciliation
GAAP Operating
Expenses $ 29,238 $ 26,974 $
19,834 Amortization of acquisition intangibles (370 ) (404 )
(404 ) Stock compensation expense - R&D (521 ) (501 ) (514 )
Stock compensation expense - SG&A (780 ) (619 ) (787 ) Facility
Related adjustments (4 ) - 22 International sales reorganization
charges (790 ) - - Provision for litigation expenses and
settlements (135 ) - 2,745 Restructuring and other costs, net
- (572 ) -
Non-GAAP Operating
Expenses $ 26,638 $ 24,878
$ 20,896 CIRRUS LOGIC,
INC. CONSOLIDATED CONDENSED BALANCE SHEET (in
thousands) Jun. 26, Mar. 27,
Jun. 27, 2010 2010 2009
(unaudited) (unaudited) ASSETS Current assets Cash and cash
equivalents $ 46,158 $ 16,109 $ 26,942 Restricted investments 6,355
5,855 5,755 Marketable securities 96,148 85,384 78,413 Accounts
receivable, net 34,536 23,963 13,969 Inventories 42,415 35,396
20,192 Other current assets 18,656 18,148
4,615 Total Current Assets 244,268 184,855
149,886 Long-term marketable securities 13,008 34,278 11,254
Property and equipment, net 21,306 18,674 18,631 Intangibles, net
21,402 21,896 22,567 Goodwill 6,027 6,027 6,027 Other assets
1,866 1,880 1,972 Total Assets $
307,877 $ 267,610 $ 210,337 LIABILITIES
AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable $
28,088 $ 20,340 $ 14,180 Accrued salaries and benefits 8,685 9,962
5,129 Other accrued liabilities 5,845 5,100 4,924 Deferred income
on shipments to distributors 8,561 6,488
3,249 Total Current Liabilities 51,179 41,890
27,482 Long-term restructuring accrual 497 596 849 Other
long-term obligations 6,487 6,523 7,336 Stockholders'
equity: Capital stock 966,414 952,803 946,886 Accumulated deficit
(715,951 ) (733,553 ) (771,730 ) Accumulated other comprehensive
loss (749 ) (649 ) (486 ) Total Stockholders'
Equity 249,714 218,601 174,670
Total Liabilities and Stockholders' Equity $ 307,877
$ 267,610 $ 210,337 Prepared in accordance
with Generally Accepted Accounting Principles
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