Exhibit 99.1
Cirrus Logic Reports December Quarter Revenue Up 15 Percent Sequentially to $218.9 Million
Completes Acquisition of Leading Voice-Based Technology Supplier Acoustic Technologies
AUSTIN, Texas--(BUSINESS WIRE)--January 28, 2014--Cirrus Logic, Inc. (Nasdaq: CRUS), a leader in high-precision analog and digital signal processing components, today posted on its investor relations website at http://investor.cirrus.com the quarterly Shareholder Letter that contains the complete financial results for the third quarter fiscal year 2014, which ended Dec. 28, as well as the company’s current business outlook.
“We delivered strong revenue, operating profit and EPS results for the third quarter,” said Jason Rhode, president and chief executive officer. “While our business is typically driven by product cycles that weight our revenue more heavily towards the September and December quarters, we expect to exceed our operating profit goal of 20 percent in FY14 and we remain committed to this long-term target. We are extremely excited to be taping out a wave of new products in advanced geometries this year as we look to capitalize on strategic opportunities in audio with new and existing customers, especially the growing trend of voice as a powerful interface to a wide variety of devices. We anticipate these products will contribute to future revenue growth as early as calendar year 2015.”
Reported Financial Results – Third Quarter FY14
- Revenue of $218.9 million;
- Gross margin of 47.4 percent;
- GAAP operating expenses of $51 million and non-GAAP operating expenses of $45 million; and
- GAAP diluted earnings per share of $0.63 and non-GAAP diluted earnings per share of $0.89.
A reconciliation of the non-GAAP charges is included in the tables accompanying this press release.
Business Outlook – Fourth Quarter FY14
- Revenue is expected to range between $130 million and $150 million;
- Gross margin is expected to be between 47 percent and 49 percent; and
- Combined R&D and SG&A expenses are expected to range between $51 million and $55 million, which includes approximately $6 million in share-based compensation and amortization of acquired intangibles.
Cirrus Logic will host a live Q&A session at 5 p.m. EST today to answer questions related to its financial results and business outlook. Participants may listen to the conference call on the Cirrus Logic website. Participants who would like to submit a question to be addressed during the call are requested to email investor.relations@cirrus.com. A replay of the webcast can be accessed on the Cirrus Logic website approximately two hours following its completion, or by calling (404) 537-3406, or toll-free at (855) 859-2056 (Access Code: 27210276).
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 Phoenix, 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 operating expenses, net income, operating profit and 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. 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 fourth quarter fiscal year 2014 revenue, gross margin, combined research and development and selling, general and administrative expense levels, share-based compensation expense and amortization of acquired intangibles. 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: the level of orders and shipments during the fourth quarter of fiscal year 2014, as well as customer cancellations of orders, or the failure to place orders consistent with forecasts; and the risk factors listed in our Form 10-K for the year ended March 30, 2013, 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.
Summary financial data follows:
| CIRRUS LOGIC, INC. | |||||||||||||||||||||
| CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS | |||||||||||||||||||||
| (unaudited) | |||||||||||||||||||||
| (in thousands, except per share data) | |||||||||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||
| Dec. 28, | Sep. 28, | Dec. 29, | Dec. 28, | Dec. 29, | |||||||||||||||||
| 2013 | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||
| Q3'14 | Q2'14 | Q3'13 | Q3'14 | Q3'13 | |||||||||||||||||
| Audio products | $ | 206,388 | $ | 179,912 | $ | 300,010 | $ | 529,966 | $ | 558,671 | |||||||||||
| Energy products | 12,495 | 10,759 | 10,123 | 34,713 | 44,242 | ||||||||||||||||
| Net revenue | 218,883 | 190,671 | 310,133 | 564,679 | 602,913 | ||||||||||||||||
| Cost of sales | 115,034 | 91,223 | 152,083 | 281,884 | 291,336 | ||||||||||||||||
| Gross Profit | 103,849 | 99,448 | 158,050 | 282,795 | 311,577 | ||||||||||||||||
| Gross Margin | 47.4 | % | 52.2 | % | 51.0 | % | 50.1 | % | 51.7 | % | |||||||||||
| Research and development | 32,426 | 29,722 | 29,608 | 90,678 | 83,986 | ||||||||||||||||
| Selling, general and administrative | 18,625 | 19,215 | 19,021 | 57,038 | 57,274 | ||||||||||||||||
| Restructuring and other costs | 12 | (154 | ) | 3,539 | (572 | ) | 3,539 | ||||||||||||||
| Gain on sale of asset | - | - | (247 | ) | - | (247 | ) | ||||||||||||||
| Patent settlements, net | - | - | - | 695 | - | ||||||||||||||||
| Total operating expenses | 51,063 | 48,783 | 51,921 | 147,839 | 144,552 | ||||||||||||||||
| Operating income | 52,786 | 50,665 | 106,129 | 134,956 | 167,025 | ||||||||||||||||
| Interest income, net | 222 | 201 | 76 | 581 | 334 | ||||||||||||||||
| Other income (expense), net | (45 | ) | (38 | ) | (31 | ) | (100 | ) | (94 | ) | |||||||||||
| Income before income taxes | 52,963 | 50,828 | 106,174 | 135,437 | 167,265 | ||||||||||||||||
| Provision (benefit) for income taxes | 11,463 | 17,461 | 38,312 | 39,928 | 57,027 | ||||||||||||||||
| Net income | $ | 41,500 | $ | 33,367 | $ | 67,862 | $ | 95,509 | $ | 110,238 | |||||||||||
| Basic earnings per share: | $ | 0.66 | $ | 0.53 | $ | 1.04 | $ | 1.51 | $ | 1.70 | |||||||||||
| Diluted earnings per share: | $ | 0.63 | $ | 0.50 | $ | 0.99 | $ | 1.45 | $ | 1.60 | |||||||||||
| Weighted average number of shares: | |||||||||||||||||||||
| Basic | 62,854 | 63,217 | 65,055 | 63,170 | 64,859 | ||||||||||||||||
| Diluted | 65,368 | 66,125 | 68,866 | 65,894 | 68,946 | ||||||||||||||||
| 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 | Nine Months Ended | |||||||||||||||||||
| Dec. 28, | Sep. 28, | Dec. 29, | Dec. 28, | Dec. 29, | ||||||||||||||||
| 2013 | 2013 | 2012 | 2013 | 2012 | ||||||||||||||||
| Net Income Reconciliation | Q3'14 | Q2'14 | Q3'13 | Q3'14 | Q3'13 | |||||||||||||||
| GAAP Net Income | $ | 41,500 | $ | 33,367 | $ | 67,862 | $ | 95,509 | $ | 110,238 | ||||||||||
| Amortization of acquisition intangibles | 275 | - | - | 275 | 604 | |||||||||||||||
| Stock based compensation expense | 6,016 | 5,739 | 6,026 | 17,529 | 15,762 | |||||||||||||||
| International sales reorganization charges | - | - | (47 | ) | - | (47 | ) | |||||||||||||
| Restructuring and other costs, net | 12 | (154 | ) | 3,539 | (572 | ) | 3,539 | |||||||||||||
| Gain on asset sale | - | - | (247 | ) | - | (247 | ) | |||||||||||||
| Patent settlements, net | - | - | - | 695 | - | |||||||||||||||
| Provision (benefit) for income taxes | 10,300 | 16,378 | 35,667 | 36,839 | 52,602 | |||||||||||||||
| Non-GAAP Net Income | $ | 58,103 | $ | 55,330 | $ | 112,800 | $ | 150,275 | $ | 182,451 | ||||||||||
| Earnings Per Share Reconciliation | ||||||||||||||||||||
| GAAP Diluted earnings per share | $ | 0.63 | $ | 0.50 | $ | 0.99 | $ | 1.45 | $ | 1.60 | ||||||||||
| Effect of Amortization of acquisition intangibles | - | - | - | - | 0.01 | |||||||||||||||
| Effect of Stock based compensation expense | 0.10 | 0.09 | 0.09 | 0.27 | 0.23 | |||||||||||||||
| Effect of Restructuring and other costs, net | - | - | 0.05 | (0.01 | ) | 0.05 | ||||||||||||||
| Effect of Patent settlements, net | - | - | - | 0.01 | - | |||||||||||||||
| Effect of Provision (benefit) for income taxes | 0.16 | 0.25 | 0.51 | 0.56 | 0.76 | |||||||||||||||
| Non-GAAP Diluted earnings per share | $ | 0.89 | $ | 0.84 | $ | 1.64 | $ | 2.28 | $ | 2.65 | ||||||||||
| Operating Income Reconciliation | ||||||||||||||||||||
| GAAP Operating Income | $ | 52,786 | $ | 50,665 | $ | 106,129 | $ | 134,956 | $ | 167,025 | ||||||||||
| GAAP Operating Profit | 24 | % | 27 | % | 34 | % | 24 | % | 28 | % | ||||||||||
| Amortization of acquisition intangibles | 275 | - | - | 275 | 604 | |||||||||||||||
| Stock compensation expense - COGS | 332 | 239 | 218 | 577 | 455 | |||||||||||||||
| Stock compensation expense - R&D | 2,834 | 2,158 | 3,234 | 7,846 | 7,574 | |||||||||||||||
| Stock compensation expense - SG&A | 2,850 | 3,342 | 2,574 | 9,106 | 7,733 | |||||||||||||||
| International sales reorganization charges | - | - | (47 | ) | - | (47 | ) | |||||||||||||
| Restructuring and other costs, net | 12 | (154 | ) | 3,539 | (572 | ) | 3,539 | |||||||||||||
| Gain on asset sale | - | - | (247 | ) | - | (247 | ) | |||||||||||||
| Patent settlements, net | - | - | - | 695 | - | |||||||||||||||
| Non-GAAP Operating Income | $ | 59,089 | $ | 56,250 | $ | 115,400 | $ | 152,883 | $ | 186,636 | ||||||||||
| Non-GAAP Operating Profit | 27 | % | 30 | % | 37 | % | 27 | % | 31 | % | ||||||||||
| Operating Expense Reconciliation | ||||||||||||||||||||
| GAAP Operating Expenses | $ | 51,063 | $ | 48,783 | $ | 51,921 | $ | 147,839 | $ | 144,552 | ||||||||||
| Amortization of acquisition intangibles | (275 | ) | - | - | (275 | ) | (604 | ) | ||||||||||||
| Stock compensation expense - R&D | (2,834 | ) | (2,158 | ) | (3,234 | ) | (7,846 | ) | (7,574 | ) | ||||||||||
| Stock compensation expense - SG&A | (2,850 | ) | (3,342 | ) | (2,574 | ) | (9,106 | ) | (7,733 | ) | ||||||||||
| International sales reorganization charges | - | - | 47 | - | 47 | |||||||||||||||
| Restructuring and other costs, net | (12 | ) | 154 | (3,539 | ) | 572 | (3,539 | ) | ||||||||||||
| Gain on asset sale | - | - | 247 | - | 247 | |||||||||||||||
| Patent settlements, net | - | - | - | (695 | ) | - | ||||||||||||||
| Non-GAAP Operating Expenses | $ | 45,092 | $ | 43,437 | $ | 42,868 | $ | 130,489 | $ | 125,396 | ||||||||||
| CIRRUS LOGIC, INC. | |||||||||||||
| CONSOLIDATED CONDENSED BALANCE SHEET | |||||||||||||
| unaudited; in thousands | |||||||||||||
| Dec. 28, | Sep. 28, | Dec. 29, | |||||||||||
| 2013 | 2013 | 2012 | |||||||||||
| ASSETS | |||||||||||||
| Current assets | |||||||||||||
| Cash and cash equivalents | $ | 74,690 | $ | 68,886 | $ | 87,452 | |||||||
| Restricted investments | - | - | - | ||||||||||
| Marketable securities | 215,792 | 199,423 | 60,717 | ||||||||||
| Accounts receivable, net | 109,535 | 97,640 | 170,683 | ||||||||||
| Inventories | 69,985 | 91,247 | 135,023 | ||||||||||
| Deferred tax asset | 33,155 | 38,398 | 53,140 | ||||||||||
| Other current assets | 25,662 | 23,978 | 21,775 | ||||||||||
| Total Current Assets | 528,819 | 519,572 | 528,790 | ||||||||||
| Long-term marketable securities | 37,115 | 40,254 | - | ||||||||||
| Property and equipment, net | 102,542 | 101,885 | 100,534 | ||||||||||
| Intangibles, net | 13,427 | 4,734 | 4,920 | ||||||||||
| Goodwill | 16,335 | 6,027 | 6,027 | ||||||||||
| Deferred tax asset | 17,354 | 16,638 | 36,466 | ||||||||||
| Other assets | 6,848 | 10,051 | 15,761 | ||||||||||
| Total Assets | $ | 722,440 | $ | 699,161 | $ | 692,498 | |||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||||
| Current liabilities | |||||||||||||
| Accounts payable | $ | 60,493 | $ | 56,868 | $ | 95,493 | |||||||
| Accrued salaries and benefits | 13,937 | 16,894 | 13,752 | ||||||||||
| Other accrued liabilities | 12,881 | 6,313 | 13,992 | ||||||||||
| Deferred income on shipments to distributors | 4,998 | 4,858 | 5,579 | ||||||||||
| Total Current Liabilities | 92,309 | 84,933 | 128,816 | ||||||||||
| Other long-term obligations | 5,108 | 11,231 | 10,131 | ||||||||||
| Stockholders' equity: | |||||||||||||
| Capital stock | 1,069,113 | 1,055,256 | 1,033,549 | ||||||||||
| Accumulated deficit | (443,322 | ) | (451,532 | ) | (479,225 | ) | |||||||
| Accumulated other comprehensive loss | (768 | ) | (727 | ) | (773 | ) | |||||||
| Total Stockholders' Equity | 625,023 | 602,997 | 553,551 | ||||||||||
| Total Liabilities and Stockholders' Equity | $ | 722,440 | $ | 699,161 | $ | 692,498 | |||||||
| Prepared in accordance with Generally Accepted Accounting Principles | |||||||||||||
CONTACT:
Cirrus Logic, Inc.
Investor Contact:
Thurman K. Case, 512-851-4125
Chief Financial Officer
Investor.Relations@cirrus.com