Exhibit 99
NEWS RELEASE
SILICON LABORATORIES REPORTS STRONG FIRST QUARTER
PERFORMANCE
AUSTIN, Texas – April 24, 2006 – Silicon Laboratories Inc. (Nasdaq: SLAB), a leader in high-performance, analog-intensive, mixed-signal ICs, today reported four percent sequential growth to $114.5 million for the first quarter of 2006.
Both the broad-based mixed-signal and mobile handset businesses grew sequentially in the first quarter. The broad-based mixed-signal business grew five percent sequentially due in part to solid demand for the ProSLIC® subscriber line interface products and mixed-signal microcontrollers (MCUs). ProSLIC revenue increased by 60 percent compared to the first quarter of 2005, benefiting from strength in the VoIP market. The mixed-signal MCU business revenue increased sequentially, and the portfolio expanded to include new, major product families in USB and Embedded Ethernet.
The ramp of the company’s FM tuner and continued strong demand in the GSM/GPRS market were responsible for mobile handset revenue growth. The company shipped a record number of RF transceivers and continued to add FM tuner design wins and customers.
The company also reported progress on design activity for the Aero® IIe EDGE transceiver, the SiRX® satellite set-top box receiver and the oscillator products.
“We are pleased with the healthy demand for our products and the progress we have made preparing our recently launched products for mass production,” said Necip Sayiner, president and CEO of Silicon Laboratories. “We are focused on product execution and on winning new
market and customer opportunities to establish a solid foundation for continued growth.”
Financial Highlights
GAAP operating income for the first quarter was $11.0 million. Non-GAAP operating income for the first quarter was $20.8 million or 18.2 percent of revenue. GAAP net income for the first quarter was $11.1 million, or 19 cents per fully diluted share. Non-GAAP net income per fully diluted share, excluding pro-forma charges was 33 cents. The reconciling charges are set forth in the reconciliation of GAAP to non-GAAP financial measures table included below. The company increased cash and short-term investments by approximately $43 million to $407 million at quarter end.
For the second quarter of 2006, the company anticipates revenue of $116 to $120 million.
Conference Call Today
A conference call discussing the first quarter results will follow the release at 7:30 a.m. Central Time. An audio webcast will be available simultaneously on Silicon Laboratories’ website under Investor Relations (www.silabs.com). A replay will be available after the call at the same website listed above or by calling 1 866-501-8774 or +1 203-369-1854 (international). These replays will be available through May 9th, 2006.
About Silicon Laboratories Inc.
Silicon Laboratories Inc. is a leading designer of high-performance, analog-intensive, mixed-signal integrated circuits (ICs) for a broad range of applications. Silicon Laboratories’ diverse portfolio of highly integrated, patented solutions is developed by a world-class engineering team with decades of cumulative expertise in cutting-edge mixed-signal design. The company has design, engineering, marketing, sales and applications offices throughout North America, Europe and Asia. For more information about Silicon Laboratories please visit www.silabs.com.
Cautionary Language
This press release contains forward-looking statements based on Silicon Laboratories’ current expectations. The words “believe,” “estimate,” “expect,” “intend,” “anticipate,” “plan,” “project,” “will” and similar phrases as they relate to Silicon Laboratories are intended to
identify such forward-looking statements. These forward-looking statements reflect the current views and assumptions of Silicon Laboratories and are subject to various risks and uncertainties that could cause actual results to differ materially from expectations. Among the factors that could cause actual results to differ materially from those in the forward-looking statements are the following: risks that Silicon Laboratories may not be able to maintain its historical growth; quarterly fluctuations in revenues and operating results; volatile stock price; average selling prices of products may decrease significantly and rapidly, especially for mobile handset products; dependence on a limited number of products and customers; risks associated with shifting market demand from GSM/GPRS to EDGE and WCDMA; difficulties developing new products that achieve market acceptance; risks that Silicon Laboratories may not be able to manage strains associated with its growth; dependence on key personnel; difficulties managing our manufacturers and subcontractors; difficulties managing international activities; credit risks associated with our accounts receivable; geographic concentration of manufacturers, assemblers, test service providers and customers in the Pacific Rim that subjects Silicon Laboratories’ business and results of operations to risks of natural disasters, epidemics, war and political unrest; product development risks; inventory-related risks; intellectual property litigation risks; risks associated with acquisitions; the competitive and cyclical nature of the semiconductor industry and other factors that are detailed in Silicon Laboratories’ filings with the SEC. Silicon Laboratories disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Note to editors: Silicon Laboratories, ProSLIC, Aero, AeroFONE, ISOmodem, SiRX and the Silicon Laboratories logo are trademarks of Silicon Laboratories Inc. All other product names noted herein may be trademarks of their respective holders.
CONTACT: Silicon Laboratories Inc., Shannon Pleasant, 512/464-9254 investor.relations@silabs.com
Silicon Laboratories Inc.
Unaudited Condensed Consolidated Statements of Income
(in thousands, except per share data)
| | Three Months Ended | |
| | April 1,
2006 | | April 2,
2005 | |
Revenues | | $ | 114,540 | | $ | 104,764 | |
Cost of revenues | | 51,300 | | 48,560 | |
Gross profit | | 63,240 | | 56,204 | |
Operating expenses: | | | | | |
Research and development | | 27,557 | | 19,553 | |
Selling, general and administrative | | 24,702 | | 16,878 | |
Operating expenses | | 52,259 | | 36,431 | |
Operating income | | 10,981 | | 19,773 | |
Other income (expense): | | | | | |
Interest income | | 3,202 | | 1,412 | |
Interest expense | | (175 | ) | (56 | ) |
Other income (expense), net | | 247 | | (15 | ) |
Income before income taxes | | 14,255 | | 21,114 | |
Provision for income taxes | | 3,191 | | 3,741 | |
Net income | | $ | 11,064 | | $ | 17,373 | |
Net income per share: | | | | | |
Basic | | $ | 0.20 | | $ | 0.33 | |
Diluted | | $ | 0.19 | | $ | 0.31 | |
Weighted-average common shares outstanding: | | | | | |
Basic | | 55,066 | | 52,468 | |
Diluted | | 57,656 | | 55,365 | |
Unaudited Reconciliation of GAAP to Non-GAAP Financial Measures
(in thousands, except per share data)
| | Three Months Ended | |
| | April 1,
2006 | | April 2,
2005 | |
GAAP net income | | $ | 11,064 | | $ | 17,373 | |
Stock compensation adjustments: | | | | | |
Cost of revenues | | 144 | | 10 | |
Research and development | | 4,302 | | 586 | |
Selling, general and administrative | | 5,376 | | 157 | |
Provision for income taxes | | (1,733 | ) | (272 | ) |
Research and development grant | | — | | (1,439 | ) |
Non-GAAP net income | | $ | 19,153 | | $ | 16,415 | |
| | | | | |
Diluted shares outstanding | | 57,656 | | 55,365 | |
Non-GAAP diluted net income per share | | $ | 0.33 | | $ | 0.30 | |
| | Three Months Ended | |
| | April 1,
2006 | | April 2,
2005 | |
GAAP operating income | | $ | 10,981 | | $ | 19,773 | |
Stock compensation adjustments: | | | | | |
Cost of revenues | | 144 | | 10 | |
Research and development | | 4,302 | | 586 | |
Selling, general and administrative | | 5,376 | | 157 | |
Research and development grant | | — | | (1,439 | ) |
Non-GAAP operating income | | $ | 20,803 | | $ | 19,087 | |
| | | | | |
Non-GAAP operating income % | | 18 | % | 18 | % |
Silicon Laboratories Inc.
Condensed Consolidated Balance Sheets
(in thousands, except per share data)
| | April 1,
2006 | | December 31,
2005 | |
| | (Unaudited) | | | |
ASSETS | | | | | |
| | | | | |
Current assets: | | | | | |
Cash and cash equivalents | | $ | 105,595 | | $ | 100,504 | |
Short-term investments | | 301,494 | | 263,206 | |
Accounts receivable, net of allowance for doubtful accounts of $1,088 at April 1, 2006 and December 31, 2005 | | 76,057 | | 68,824 | |
Inventories | | 24,053 | | 23,132 | |
Deferred income taxes | | 13,114 | | 11,505 | |
Prepaid expenses and other | | 16,442 | | 9,670 | |
Total current assets | | 536,755 | | 476,841 | |
Property, equipment and software, net | | 28,507 | | 32,584 | |
Goodwill | | 62,877 | | 62,877 | |
Other intangible assets, net | | 14,044 | | 14,838 | |
Other assets, net | | 31,091 | | 25,863 | |
Total assets | | $ | 673,274 | | $ | 613,003 | |
| | | | | |
LIABILITIES AND STOCKHOLDERS’ EQUITY | | | | | |
Current liabilities: | | | | | |
Accounts payable | | $ | 42,304 | | $ | 43,846 | |
Accrued expenses | | 13,063 | | 11,307 | |
Deferred income on shipments to distributors | | 42,115 | | 34,036 | |
Income taxes payable | | 15,860 | | 18,348 | |
Total current liabilities | | 113,342 | | 107,537 | |
Long-term obligations and other liabilities | | 11,666 | | 7,418 | |
Total liabilities | | 125,008 | | 114,955 | |
Commitments and contingencies | | | | | |
Stockholders’ equity: | | | | | |
Preferred stock—$0.0001 par value; 10,000 shares authorized; no shares issued and outstanding | | — | | — | |
Common stock—$0.0001 par value; 250,000 shares authorized; 55,491 and 54,530 shares issued and outstanding at April 1, 2006 and December 31, 2005, respectively | | 6 | | 5 | |
Additional paid-in capital | | 373,332 | | 335,284 | |
Deferred stock compensation | | — | | (1,105 | ) |
Retained earnings | | 174,928 | | 163,864 | |
Total stockholders’ equity | | 548,266 | | 498,048 | |
Total liabilities and stockholders’ equity | | $ | 673,274 | | $ | 613,003 | |
Certain prior period amounts have been reclassified to conform to the current period presentation.
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