Silicon Laboratories (SLAB) 8-K Silicon Labs Announces Fourth Quarter and Full Year 2015 Results

Exhibit 99

SILICON LABS ANNOUNCES FOURTH QUARTER AND FULL YEAR 2015 RESULTS

— Earnings Exceed Guidance —

AUSTIN, Texas — Feb. 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 EFM8TM 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.

Business Outlook

The company expects revenue in the first quarter to be in the range of $157 million to $162 million. First quarter diluted earnings (loss) per share are expected to be between $(0.08) and $(0.02) on a GAAP basis and between $0.42 and $0.48 on a non-GAAP basis.

“Strong top line performance combined with favorable opex drove a solid beat in fourth quarter EPS,” said Tyson Tuttle, CEO of Silicon Labs. “During 2015, we made significant progress in laying the foundation for our continued success as a leading supplier of silicon, software and solutions for a more connected world. Our strategic growth products, including IoT, Infrastructure and Broadcast automotive, all delivered record revenue in 2015.”

Webcast and Conference Call

A conference call discussing the quarterly results will follow this press release at 7:30 a.m. Central time. An audio webcast will be available on Silicon Labs’ 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 (855) 859-2056 or (404) 537-3406 (international) and entering conference ID 83469958. The replay will be available through March 3, 2016.

About Silicon Labs

Silicon Labs (NASDAQ: SLAB) is a leading provider of silicon, software and solutions for the Internet of Things, Infrastructure, industrial automation, consumer and automotive markets. We solve the electronics industry’s toughest problems, providing customers with significant advantages in performance, energy savings, connectivity and design simplicity. Backed by our world-class engineering teams with strong software and mixed-signal design expertise, Silicon Labs empowers developers with the tools and technologies they need to advance quickly and easily from initial idea to final product. www.silabs.com

Forward-Looking Statements

This press release contains forward-looking statements based on Silicon Labs’ current expectations. The words “believe,” “estimate,” “expect,” “intend,” “anticipate,” “plan,” “project,” “will” and similar phrases as they relate to Silicon Labs are intended to identify such forward-looking statements. These forward-looking statements reflect the current views and assumptions of Silicon Labs 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 Labs may not be able to maintain its historical growth; quarterly fluctuations in revenues and operating results; difficulties developing new products that achieve market acceptance; dependence on a limited number of products and customers; intellectual property litigation risks; risks associated with acquisitions and divestitures; product liability risks; difficulties managing our distributors, manufacturers and subcontractors; inventory-related risks; difficulties managing international activities; risks that Silicon Labs may not be able to manage strains associated with its growth; credit risks associated with our accounts receivable; dependence on key personnel; stock price volatility; geographic concentration of manufacturers, assemblers, test service providers and customers in Asia that subjects Silicon Labs’ business and results of operations to risks of natural disasters, epidemics, war and political unrest; debt-related risks; capital-raising risks; the competitive and cyclical nature of the semiconductor industry; average selling prices of products may decrease significantly and rapidly; information technology risks; conflict mineral risks and other factors that are detailed in the SEC filings of Silicon Laboratories Inc. Silicon Labs disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. References in this press release to Silicon Labs shall mean Silicon Laboratories Inc.

Note to editors: Silicon Laboratories, Silicon Labs, the “S” symbol, the Silicon Laboratories logo, and EFM32, EFM8, Simplicity Studio and TouchXpress are trademarks of Silicon Laboratories Inc. All other product names noted herein may be trademarks of their respective holders.

CONTACT: Jalene Hoover, +1 (512) 428-1610, Jalene.Hoover@silabs.com

Silicon Laboratories Inc.

Condensed Consolidated Statements of Income

(In thousands, except per share data)

(Unaudited)

	Three Months Ended						Year Ended
	January 2, 2016			January 3, 2015			January 2, 2016			January 3, 2015
Revenues	$	160,071		$	161,951		$	644,826		$	620,704
Cost of revenues	66,533			65,279			264,056			242,153
Gross margin	93,538			96,672			380,770			378,551
Operating expenses:
Research and development	47,245			46,139			188,050			172,985
Selling, general and administrative	41,497			39,527			160,486			154,145
Operating expenses	88,742			85,666			348,536			327,130
Operating income	4,796			11,006			32,234			51,421
Other income (expense):
Interest income	186			274			730			1,007
Interest expense	(668		)	(808		)	(2,828		)	(3,154		)
Other income (expense), net	(91		)	(337		)	127			(234		)
Income before income taxes	4,223			10,135			30,263			49,040
Provision (benefit) for income taxes	(1,435		)	111			677			11,019
Net income	$	5,658		$	10,024		$	29,586		$	38,021
Earnings per share:
Basic	$	0.14		$	0.24		$	0.70		$	0.88
Diluted	$	0.13		$	0.23		$	0.69		$	0.87
Weighted-average common shares outstanding:
Basic	41,670			42,279			42,309			42,970
Diluted	42,374			43,137			42,945			43,793

Unaudited Reconciliation of GAAP to Non-GAAP Financial Measures

(In thousands, except per share data)

Non-GAAP Income Statement Items	Three Months Ended January 2, 2016
	GAAP Measure		GAAP Percent of Revenue		Stock Compensation Expense		Intangible Asset Amortization		Acquisition Related Items		Termination Costs		Non- GAAP Measure		Non-GAAP Percent of Revenue
Revenues	$	160,071
Gross margin	93,538		58.4	%	$	251	$	390	$	201	$	—	$	94,380	59.0	%
Research and development	47,245		29.5	%	5,073		5,441		—		336		36,395		22.7	%
Selling, general and administrative	41,497		25.9	%	6,669		1,286		1,752		380		31,410		19.7	%
Operating income	4,796		3.0	%	11,993		7,117		1,953		716		26,575		16.6	%

Non-GAAP Earnings Per Share	Three Months Ended January 2, 2016
	GAAP Measure		Stock Compensation Expense*		Intangible Asset Amortization*		Acquisition Related Items*		Termination Costs*		Income Tax Adjustments			Non- GAAP Measure
Net income	$	5,658	$	11,993	$	7,117	$	1,953	$	716	$	(889	)	$	26,548
Diluted shares outstanding	42,374													42,374
Diluted earnings per share	$	0.13												$	0.63

* Represents pre-tax amounts

Unaudited Forward-Looking Statements Regarding Business Outlook

	Three Months Ending April 2, 2016
Business Outlook	High			Low
Estimated GAAP diluted earnings (loss) per share	$	(0.02	)	$	(0.08	)
Estimated non-GAAP charges	0.50			0.50
Estimated non-GAAP diluted earnings per share	$	0.48		$	0.42

Silicon Laboratories Inc.

Condensed Consolidated Balance Sheets

(In thousands, except per share data)

(Unaudited)

	January 2,  2016			January 3,  2015
Assets
Current assets:
Cash and cash equivalents	$	114,085		$	141,706
Short-term investments	128,901			193,489
Accounts receivable, net of allowances for doubtful accounts of $671 at January 2, 2016 and $786 at January 3, 2015	73,601			70,367
Inventories	53,895			52,631
Deferred income taxes	—			21,173
Prepaid expenses and other current assets	52,658			49,171
Total current assets	423,140			528,537
Long-term investments	7,126			7,419
Property and equipment, net	131,132			132,820
Goodwill	272,722			228,781
Other intangible assets, net	121,354			115,021
Other assets, net	55,989			29,983
Total assets	$	1,011,463		$	1,042,561
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	42,127		$	38,922
Current portion of long-term debt	10,000			10,000
Accrued expenses	52,131			73,646
Deferred income on shipments to distributors	35,448			38,662
Income taxes	2,615			2,084
Total current liabilities	142,321			163,314
Long-term debt	67,500			77,500
Other non-current liabilities	40,528			43,691
Total liabilities	250,349			284,505
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; 41,727 and 42,225 shares issued and outstanding at January 2, 2016 and January 3, 2015, respectively	4			4
Additional paid-in capital	13,868			29,501
Retained earnings	747,749			728,633
Accumulated other comprehensive loss	(507		)	(82		)
Total stockholders’ equity	761,114			758,056
Total liabilities and stockholders’ equity	$	1,011,463		$	1,042,561

Silicon Laboratories Inc.

Condensed Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)

	Year Ended
	January 2,  2016			January 3,  2015
Operating Activities
Net income	$	29,586		$	38,021
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation of property and equipment	12,517			12,561
Amortization of other intangible assets and other assets	29,131			17,923
Stock-based compensation expense	42,791			39,067
Income tax benefit (shortfall) from stock-based awards	469			489
Excess income tax benefit from stock-based awards	(2,497		)	(632		)
Deferred income taxes	(2,136		)	3,054
Changes in operating assets and liabilities:
Accounts receivable	1,702			1,757
Inventories	2,093			(7,170		)
Prepaid expenses and other assets	(870		)	9,332
Accounts payable	6,662			11,475
Accrued expenses	1,682			27,671
Deferred income on shipments to distributors	(5,298		)	7,809
Income taxes	776			(3,371		)
Other non-current liabilities	(11,161		)	(20,543		)
Net cash provided by operating activities	105,447			137,443
Investing Activities
Purchases of available-for-sale investments	(107,366		)	(166,094		)
Proceeds from sales and maturities of available-for-sale investments	171,831			156,520
Purchases of property and equipment	(11,268		)	(11,225		)
Purchases of other assets	(6,399		)	(5,514		)
Acquisitions of businesses, net of cash acquired	(96,112		)	—
Net cash used in investing activities	(49,314		)	(26,313		)
Financing Activities
Proceeds from issuance of common stock, net of cash paid for withheld taxes	3,129			13,320
Excess income tax benefit from stock-based awards	2,497			632
Repurchases of common stock	(71,448		)	(71,676		)
Payment of acquisition-related contingent consideration	(4,464		)	—
Proceeds from issuance of long-term debt, net	81,238			—
Payments on debt	(94,706		)	(7,500		)
Net cash used in financing activities	(83,754		)	(65,224		)
Increase (decrease) in cash and cash equivalents	(27,621		)	45,906
Cash and cash equivalents at beginning of period	141,706			95,800
Cash and cash equivalents at end of period	$	114,085		$	141,706