Silicon Labs Announces First Quarter 2017 Results

AUSTIN, Texas, April 26, 2017 /PRNewswire/ -- Silicon Labs (NASDAQ: SLAB), a leading provider of silicon, software and solutions for a smarter, more connected world, today reported financial results for its first quarter ended April 1, 2017. Revenue in the first quarter was at the high end of guidance at $179 million, down from $183 million in the fourth quarter. First quarter GAAP and non-GAAP earnings per share (EPS) were $0.36 and $0.63, respectively.

"We are very pleased with our first quarter 2017 financial results, reflecting solid year-on-year growth in revenue and profitability," said Tyson Tuttle, CEO of Silicon Labs. "Our Internet of Things and Infrastructure businesses now represent nearly 70 percent of revenue targeting large, high-quality, sustainable, and growing markets."

First Quarter Financial Highlights

• Internet of Things (IoT) revenue established a new record, increasing to $88 million, up 3% sequentially and 24% year-on-year.
• Infrastructure revenue declined to $36 million, down 3% sequentially and up 14% year-on-year.
• Broadcast revenue declined to $37 million, down 8% sequentially and 3% year-on-year.
• Access revenue declined to $18 million, down 8% sequentially and 15% year-on-year.

On a GAAP basis:

• GAAP gross margin was 58.7%.
• GAAP R&D expenses were $52 million.
• GAAP SG&A expenses were $40 million.
• GAAP operating income as a percentage of revenue was 7.1%.
• GAAP diluted earnings per share was $0.36.

On a non-GAAP basis, and excluding the impact of stock compensation, amortization of acquired intangible assets, amortization of interest expense related to convertible notes, and certain other items as set forth in the reconciliation tables below:

• Non-GAAP gross margin was 59.0%.
• Non-GAAP R&D expenses were $42 million.
• Non-GAAP SG&A expenses were $33 million.
• Non-GAAP operating income as a percentage of revenue was 17.3%.
• Non-GAAP diluted earnings per share was $0.63.

Product Highlights

• Announced a major expansion of Silicon Labs' EFR32™ Wireless Gecko multiprotocol SoC portfolio, delivering superior RF performance, enhanced cryptography acceleration, larger memory options, on-chip capacitive touch control, and additional low-power peripherals and sensor interfaces.
• Launched the new EFM32™ Jade and Pearl MCUs, offering new security features, larger memory options, peripheral integration, and ultra-low active and sleep mode currents.
• Launched new Micrium® OS and Platform Builder software to help embedded designers simplify IoT system configuration and accelerate development and time to market.

Business Highlights

• Completed a private offering of $400 million of 1.375% convertible senior notes.
• Added Gregg Lowe, a veteran of Freescale and Texas Instruments, to Silicon Labs' board of directors.

Business Outlook

The company expects revenue in the second quarter to be in the range of $184 million to $189 million, and also estimates the following:

On a GAAP basis:

• GAAP gross margin at 58.8%.
• GAAP operating expenses at approximately $92 million.
• GAAP effective tax rate at 11%.
• GAAP diluted earnings per share between $0.27 and $0.33.

On a non-GAAP basis, and excluding the impact of stock compensation, amortization of acquired intangible assets, amortization of interest expense related to convertible notes, and certain other items as set forth in the reconciliation tables below:

• Non-GAAP gross margin at 59.0%.
• Non-GAAP operating expenses between $74 million and $75 million.
• Non-GAAP effective tax rate at 11.5%.
• Non-GAAP diluted earnings per share between $0.68 and $0.74.

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 (www.silabs.com) under Investor Relations. 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 8459893. The replay will be available through May 26, 2017.

About Silicon Labs

Silicon Labs (NASDAQ: SLAB) is a leading provider of silicon, software and solutions for a smarter, more connected world. Our award-winning technologies are shaping the future of the Internet of Things, Internet infrastructure, industrial automation, consumer and automotive markets. Our world-class engineering team creates products focused on performance, energy savings, connectivity and simplicity. 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; cyber-attacks against our products and our networks; 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 Labs logo, Micrium, EFM32 and EFR32 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

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SOURCE Silicon Labs