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Monolithic Power Systems Announces Results for the Second Quarter Ended June 30, 2022

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Monolithic Power Systems, Inc.
Monolithic Power Systems, Inc.

KIRKLAND, Wash., Aug. 01, 2022 (GLOBE NEWSWIRE) -- Monolithic Power Systems, Inc. (“MPS”) (Nasdaq: MPWR), a global company that provides high-performance, semiconductor-based power electronics solutions, today announced financial results for the quarter ended June 30, 2022.

The financial results for the quarter ended June 30, 2022 are as follows:

 

Revenue was $461.0 million for the quarter ended June 30, 2022, a 22.1% increase from $377.7 million for the quarter ended March 31, 2022 and a 57.2% increase from $293.3 million for the quarter ended June 30, 2021.

 

 

 

 

GAAP gross margin was 58.8% for the quarter ended June 30, 2022, compared with 56.0% for the quarter ended June 30, 2021.

 

 

 

 

Non-GAAP gross margin (1) was 59.0% for the quarter ended June 30, 2022, excluding the impact of $1.2 million for stock-based compensation expense, compared with 56.3% for the quarter ended June 30, 2021, excluding the impact of $0.9 million for stock-based compensation expense and $0.1 million for deferred compensation plan expense.

 

 

 

 

GAAP operating expenses were $129.1 million for the quarter ended June 30, 2022, compared with $103.6 million for the quarter ended June 30, 2021.

 

 

 

 

Non-GAAP operating expenses (1) were $92.7 million for the quarter ended June 30, 2022, excluding $41.7 million for stock-based compensation expense and $5.3 million for deferred compensation plan income, compared with $70.3 million for the quarter ended June 30, 2021, excluding $31.2 million for stock-based compensation expense and $2.0 million for deferred compensation plan expense.

 

 

 

 

GAAP operating income was $141.9 million for the quarter ended June 30, 2022, compared with $60.6 million for the quarter ended June 30, 2021.

 

 

 

 

Non-GAAP operating income (1) was $179.4 million for the quarter ended June 30, 2022, excluding $42.9 million for stock-based compensation expense and $5.4 million for deferred compensation plan income, compared with $94.9 million for the quarter ended June 30, 2021, excluding $32.1 million for stock-based compensation expense and $2.2 million for deferred compensation plan expense.

 

 

 

 

GAAP other expense, net, was $5.1 million for the quarter ended June 30, 2022, compared with other income, net, of $3.0 million for the quarter ended June 30, 2021.

 

 

 

 

Non-GAAP other expense, net (1) was $7,000 for the quarter ended June 30, 2022, excluding $5.1 million for deferred compensation plan expense, compared with non-GAAP other income, net (1), of $1.2 million for the quarter ended June 30, 2021, excluding $1.9 million for deferred compensation plan income.

 

 

 

 

GAAP income before income taxes was $136.8 million for the quarter ended June 30, 2022, compared with $63.7 million for the quarter ended June 30, 2021.

 

 

 

 

Non-GAAP income before income taxes (1) was $179.4 million for the quarter ended June 30, 2022, excluding $42.9 million for stock-based compensation expense and $0.3 million for deferred compensation plan income, compared with $96.1 million for the quarter ended June 30, 2021, excluding $32.1 million for stock-based compensation expense and $0.3 million for deferred compensation plan expense.

 

 

 

 

GAAP net income was $114.7 million and $2.37 per diluted share for the quarter ended June 30, 2022. Comparatively, GAAP net income was $55.2 million and $1.16 per diluted share for the quarter ended June 30, 2021.

 

 

 

 

Non-GAAP net income (1) was $157.0 million and $3.25 per diluted share for the quarter ended June 30, 2022, excluding $42.9 million for stock-based compensation expense, $0.3 million for net deferred compensation plan income and $0.3 million for related tax effects, compared with $86.5 million and $1.81 per diluted share for the quarter ended June 30, 2021, excluding $32.1 million for stock-based compensation expense, $0.3 million for net deferred compensation plan expense and $1.1 million for related tax effects.


The financial results for the six months ended June 30, 2022 are as follows:

 

Revenue was $838.7 million for the six months ended June 30, 2022, a 53.1% increase from $547.8 million for the six months ended June 30, 2021.

 

 

 

 

GAAP gross margin was 58.4% for the six months ended June 30, 2022, compared with 55.7% for the six months ended June 30, 2021.

 

 

 

 

Non-GAAP gross margin (1) was 58.7% for the six months ended June 30, 2022, excluding the impact of $2.5 million for stock-based compensation expense and $0.1 million for deferred compensation plan income, compared with 56.1% for the six months ended June 30, 2021, excluding the impact of $1.7 million for stock-based compensation expense and $0.3 million for deferred compensation plan expense.

 

 

 

 

GAAP operating expenses were $251.8 million for the six months ended June 30, 2022, compared with $198.6 million for the six months ended June 30, 2021.

 

 

 

 

Non-GAAP operating expenses (1) were $179.2 million for the six months ended June 30, 2022, excluding $80.2 million for stock-based compensation expense, $7.7 million for deferred compensation plan income and $0.1 million for amortization of purchased intangible assets, compared with $136.6 million for the six months ended June 30, 2021, excluding $59.0 million for stock-based compensation expense and $3.0 million for deferred compensation plan expense.

 

 

 

 

GAAP operating income was $238.0 million for the six months ended June 30, 2022, compared with $106.7 million for the six months ended June 30, 2021.

 

 

 

 

Non-GAAP operating income (1) was $313.1 million for the six months ended June 30, 2022, excluding $82.7 million for stock-based compensation expense, $7.8 million for deferred compensation plan income and $0.1 million for amortization of purchased intangible assets, compared with $170.7 million for the six months ended June 30, 2021, excluding $60.7 million for stock-based compensation expense and $3.3 million for deferred compensation plan expense.

 

 

 

 

GAAP other expense, net, was $5.7 million for the six months ended June 30, 2022, compared with other income, net, of $5.6 million for the six months ended June 30, 2021.

 

 

 

 

Non-GAAP other income, net (1) was $1.6 million for the six months ended June 30, 2022, excluding $7.3 million for deferred compensation plan expense, compared with $2.6 million for the six months ended June 30, 2021, excluding $3.0 million for deferred compensation plan income.

 

 

 

 

GAAP income before income taxes was $232.3 million for the six months ended June 30, 2022, compared with $112.3 million for the six months ended June 30, 2021.

 

 

 

 

Non-GAAP income before income taxes (1) was $314.6 million for the six months ended June 30, 2022, excluding $82.7 million for stock-based compensation expense, $0.5 million for deferred compensation plan income and $0.1 million for amortization of purchased intangible assets, compared with $173.3 million for the six months ended June 30, 2021, excluding $60.7 million for stock-based compensation expense and $0.2 million for deferred compensation plan expense.

 

 

 

 

GAAP net income was $194.2 million and $4.02 per diluted share for the six months ended June 30, 2022. Comparatively, GAAP net income was $100.6 million and $2.11 per diluted share for the six months ended June 30, 2021.

 

 

 

 

Non-GAAP net income (1) was $275.3 million and $5.70 per diluted share for the six months ended June 30, 2022, excluding $82.7 million for stock-based compensation expense, $0.5 million for net deferred compensation plan income, $0.1 million for amortization of purchased intangible assets and $1.3 million for related tax effects, compared with $155.9 million and $3.27 per diluted share for the six months ended June 30, 2021, excluding $60.7 million for stock-based compensation expense, $0.2 million for net deferred compensation plan expense and $5.6 million for related tax effects.

The following is a summary of revenue by end market (in thousands):

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

End Market

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Storage and Computing

 

$

122,288

 

 

$

57,795

 

 

$

218,874

 

 

$

109,107

 

Enterprise Data

 

 

65,199

 

 

 

29,928

 

 

 

107,708

 

 

 

46,111

 

Automotive

 

 

61,019

 

 

 

48,699

 

 

 

115,565

 

 

 

93,566

 

Industrial

 

 

55,865

 

 

 

43,323

 

 

 

104,403

 

 

 

83,111

 

Communications

 

 

59,299

 

 

 

37,459

 

 

 

114,873

 

 

 

73,528

 

Consumer

 

 

97,334

 

 

 

76,113

 

 

 

177,295

 

 

 

142,349

 

Total

 

$

461,004

 

 

$

293,317

 

 

$

838,718

 

 

$

547,772

 

In the first quarter of 2022, the Company reorganized its end markets and broke out Computing and Storage into two new end markets: Storage and Computing, and Enterprise Data. All prior-period amounts have been restated to reflect the changes in the end markets.

The following is a summary of revenue by product family (in thousands):

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

Product Family

 

2022

 

 

2021

 

 

2022

 

 

2021

 

DC to DC

 

$

442,250

 

 

$

278,808

 

 

$

801,099

 

 

$

520,237

 

Lighting Control

 

 

18,754

 

 

 

14,509

 

 

 

37,619

 

 

 

27,535

 

Total

 

$

461,004

 

 

$

293,317

 

 

$

838,718

 

 

$

547,772

 

“We are continuing to execute on our growth strategies, including expansion and diversification of our R&D centers and manufacturing partnerships in multiple countries,” said Michael Hsing, CEO and founder of MPS.

Business Outlook

The following are MPS’s financial targets for the third quarter ending September 30, 2022:

 

Revenue in the range of $480.0 million to $500.0 million.

 

 

 

 

GAAP gross margin between 58.4% and 59.0%. Non-GAAP gross margin (1) between 58.7% and 59.3%, which excludes an estimated impact of stock-based compensation expenses of 0.3%.

 

 

 

 

GAAP research and development (“R&D”) and selling, general and administrative (“SG&A”) expenses between $136.2 million and $140.2 million. Non-GAAP R&D and SG&A expenses (1) between $94.7 million and $96.7 million, which excludes estimated stock-based compensation expenses in the range of $41.5 million to $43.5 million.

 

 

 

 

Total stock-based compensation expense of $42.8 million to $44.8 million.

 

 

 

 

Litigation expense of $2.3 million to $2.7 million.

 

 

 

 

Interest and other income of $1.3 million to $1.7 million before foreign exchange gains or losses.

 

 

 

 

Fully diluted shares outstanding between 47.9 million and 48.9 million.

(1) Non-GAAP net income, non-GAAP earnings per share, non-GAAP gross margin, non-GAAP R&D and SG&A expenses, non-GAAP operating expenses, non-GAAP other income (expense), net, non-GAAP operating income and non-GAAP income before taxes differ from net income, earnings per share, gross margin, R&D and SG&A expenses, operating expenses, other income (expense), net, operating income and income before taxes determined in accordance with Generally Accepted Accounting Principles in the United States (“GAAP”). Non-GAAP net income and non-GAAP earnings per share exclude the effect of stock-based compensation expense, deferred compensation plan income/expense, amortization of purchased intangible assets and related tax effects. Non-GAAP gross margin excludes the effect of stock-based compensation expense and deferred compensation plan income/expense. Non-GAAP operating expenses exclude the effect of stock-based compensation expense, amortization of purchased intangible assets and deferred compensation plan income/expense. Non-GAAP other income (expense), net excludes the effect of deferred compensation plan income/expense. Non-GAAP operating income excludes the effect of stock-based compensation expense, amortization of purchased intangible assets and deferred compensation plan income/expense. Non-GAAP income before taxes excludes the effect of stock-based compensation expense, amortization of purchased intangible assets and deferred compensation plan income/expense. Projected non-GAAP gross margin excludes the effect of stock-based compensation expense. Projected non-GAAP R&D and SG&A expenses exclude the effect of stock-based compensation expense. These non-GAAP financial measures are not prepared in accordance with GAAP and should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. A schedule reconciling non-GAAP financial measures is included at the end of this press release. MPS utilizes both GAAP and non-GAAP financial measures to assess what it believes to be its core operating performance and to evaluate and manage its internal business and assist in making financial operating decisions. MPS believes that the inclusion of non-GAAP financial measures, together with GAAP measures, provides investors with an alternative presentation useful to investors' understanding of MPS's core operating results and trends. Additionally, MPS believes that the inclusion of non-GAAP measures, together with GAAP measures, provides investors with an additional dimension of comparability to similar companies. However, investors should be aware that non-GAAP financial measures utilized by other companies are not likely to be comparable in most cases to the non-GAAP financial measures used by MPS.

Earnings Webinar
MPS plans to host a Zoom webinar covering its financial results at 2:00 p.m. PT / 5:00 p.m. ET, August 1, 2022. You can access the webinar at: https://mpsic.zoom.us/s/97031727105. The webinar will be archived and available for replay for one year under the Investor Relations page on the MPS website.

Safe Harbor Statement
This press release contains, and statements that will be made during the accompanying webinar will contain, forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995, including under “Business Outlook” and the quote from our CEO herein, including, among other things, (i) projected revenues, GAAP and non-GAAP gross margin, GAAP and non-GAAP R&D and SG&A expenses, stock-based compensation expenses, litigation expenses, interest income, and fully diluted shares outstanding, (ii) our outlook for the remainder of 2022 and the long-term prospects of the company, including our performance against our business plan, revenue growth in certain of our market segments, potential new business segments, our continued investment into R&D, expected revenue growth, customers' acceptance of our new product offerings, the prospects of our new product development, our expectations regarding market and industry segment trends and prospects, and our projected expansion of capacity and the impact it may have on our business, (iii) our ability to penetrate new markets and expand our market share, (iv) the seasonality of our business, (v) our ability to reduce our expenses, and (vi) statements of the assumptions underlying or relating to any statement described in (i), (ii), (iii), (iv), or (v). These forward-looking statements are not historical facts or guarantees of future performance or events, are based on current expectations, estimates, beliefs, assumptions, goals, and objectives, and involve significant known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from the results expressed by these statements. Readers of this press release and listeners to the accompanying conference call are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date hereof. Factors that could cause actual results to differ include, but are not limited to, our ability to attract new customers and retain existing customers; acceptance of, or demand for, MPS’s products, in particular the new products launched recently, being different than expected; our ability to efficiently and effectively develop new products and receive a return on our R&D expense investment; our ability to increase market share in our targeted markets; our ability to meet customer demand for our products due to constraints on our third-party suppliers’ ability to manufacture sufficient quantities of our products or otherwise; our ability to expand manufacturing capacity to support future growth; competition generally and the increasingly competitive nature of our industry; any market disruptions or interruptions in MPS’s schedule of new product development releases; adverse changes in production and testing efficiency of our products; our ability to manage our inventory levels; our ability to effectively manage our growth and attract and retain qualified personnel; the effect of export controls, trade and economic sanctions regulations and other regulatory or contractual limitations on our ability to sell or develop our products in certain foreign markets, particularly in China; our ability to obtain governmental licenses and approvals for international trading activities or technology transfers, including export licenses; adverse changes in laws and government regulations such as tariffs on imports of foreign goods, export regulations and export classifications, including in foreign countries where MPS has offices or operations; adverse events arising from orders or regulations of governmental entities, including such orders or regulations that impact our customers, and adoption of new or amended accounting standards; the effect of epidemics and pandemics, such as the COVID-19 outbreak, on the global economy and on our business; adequate supply of our products from our third-party manufacturing partners; the risks, uncertainties and costs of litigation in which we are involved; the outcome of any upcoming trials, hearings, motions and appeals; the adverse impact on MPS’s financial performance if its tax and litigation provisions are inadequate; adverse changes to the global economy, including due to the Russia-Ukraine conflict and the global economic downturn; adverse changes or developments in the semiconductor industry generally, which is cyclical in nature, and our ability to adjust our operations to address such changes or developments; difficulty in predicting or budgeting for future customer demand and channel inventories, expenses and financial contingencies (including as a result of the COVID-19 pandemic and as a result of the Russia-Ukraine conflict); our ability to realize the anticipated benefits of companies and products that we acquire, and our ability to effectively and efficiently integrate these acquired companies and products into our operations; the ongoing consolidation of companies in the semiconductor industry; and other important risk factors identified under the caption “Risk Factors” in MPS’s Securities and Exchange Commission (“SEC”) filings, including, but not limited to, our Annual Report on Form 10-K filed with the SEC on February 25, 2022 and our Quarterly Report on Form 10-Q filed with the SEC on May 10, 2022. The forward-looking statements in this press release and statements made during the accompanying webinar represent MPS’s projections and current expectations, as of the date hereof, not predictions of actual performance. MPS assumes no obligation to update the information in this press release or in the accompanying webinar.

About Monolithic Power Systems
Monolithic Power Systems, Inc. (“MPS”) is a global company that provides high-performance, semiconductor-based power electronics solutions. MPS’s mission is to reduce energy and material consumption to improve all aspects of quality of life. Founded in 1997 by our CEO Michael Hsing, MPS has three core strengths: deep system-level knowledge, strong semiconductor design expertise, and innovative proprietary semiconductor process and system integration technologies. These combined advantages enable MPS to provide customers with reliable, compact and monolithic solutions that offer highly energy-efficient and cost-effective products, as well as providing a consistent return on investment to our stockholders. MPS can be contacted through its website at www.monolithicpower.com or its support offices around the world.

Monolithic Power Systems, MPS, and the MPS logo are registered trademarks of Monolithic Power Systems, Inc. in the U.S. and trademarked in certain other countries.

Contact:
Bernie Blegen
Chief Financial Officer
Monolithic Power Systems, Inc.
408-826-0777
investors@monolithicpower.com

Monolithic Power Systems, Inc.
Condensed Consolidated Balance Sheets
(Unaudited, in thousands, except par value)

 

 

June 30,

 

 

December 31,

 

 

 

2022

 

 

2021

 

ASSETS

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

342,867

 

 

$

189,265

 

Short-term investments

 

 

469,012

 

 

 

535,817

 

Accounts receivable, net

 

 

125,508

 

 

 

104,813

 

Inventories

 

 

359,647

 

 

 

259,417

 

Other current assets

 

 

35,055

 

 

 

35,540

 

Total current assets

 

 

1,332,089

 

 

 

1,124,852

 

Property and equipment, net

 

 

356,687

 

 

 

362,962

 

Goodwill

 

 

6,571

 

 

 

6,571

 

Deferred tax assets, net

 

 

23,961

 

 

 

21,917

 

Other long-term assets

 

 

66,385

 

 

 

69,523

 

Total assets

 

$

1,785,693

 

 

$

1,585,825

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS EQUITY

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

$

77,925

 

 

$

83,027

 

Accrued compensation and related benefits

 

 

85,238

 

 

 

62,635

 

Other accrued liabilities

 

 

91,324

 

 

 

81,282

 

Total current liabilities

 

 

254,487

 

 

 

226,944

 

Income tax liabilities

 

 

47,350

 

 

 

47,669

 

Other long-term liabilities

 

 

60,734

 

 

 

67,227

 

Total liabilities

 

 

362,571

 

 

 

341,840

 

Commitments and contingencies

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

 

 

Common stock and additional paid-in capital: $0.001 par value; shares authorized: 150,000; shares issued and outstanding: 46,787 and 46,256, respectively

 

 

891,888

 

 

 

803,226

 

Retained earnings

 

 

545,920

 

 

 

424,879

 

Accumulated other comprehensive income (loss)

 

 

(14,686

)

 

 

15,880

 

Total stockholders’ equity

 

 

1,423,122

 

 

 

1,243,985

 

Total liabilities and stockholders’ equity

 

$

1,785,693

 

 

$

1,585,825

 

 

 

 

 

 

 

 

 

 

Monolithic Power Systems, Inc.
Condensed Consolidated Statements of Operations
(Unaudited, in thousands, except per share amounts)

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Revenue

 

$

461,004

 

 

$

293,317

 

 

$

838,718

 

 

$

547,772

 

Cost of revenue

 

 

190,043

 

 

 

129,102

 

 

 

348,877

 

 

 

242,498

 

Gross profit

 

 

270,961

 

 

 

164,215

 

 

 

489,841

 

 

 

305,274

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

57,131

 

 

 

44,753

 

 

 

111,234

 

 

 

86,645

 

Selling, general and administrative

 

 

70,668

 

 

 

57,238

 

 

 

137,822

 

 

 

108,691

 

Litigation expense

 

 

1,274

 

 

 

1,596

 

 

 

2,763

 

 

 

3,224

 

Total operating expenses

 

 

129,073

 

 

 

103,587

 

 

 

251,819

 

 

 

198,560

 

Operating income

 

 

141,888

 

 

 

60,628

 

 

 

238,022

 

 

 

106,714

 

Other income (expense), net

 

 

(5,092

)

 

 

3,031

 

 

 

(5,726

)

 

 

5,618

 

Income before income taxes

 

 

136,796

 

 

 

63,659

 

 

 

232,296

 

 

 

112,332

 

Income tax expense

 

 

22,117

 

 

 

8,490

 

 

 

38,051

 

 

 

11,750

 

Net income

 

$

114,679

 

 

$

55,169

 

 

$

194,245

 

 

$

100,582

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

2.46

 

 

$

1.20

 

 

$

4.17

 

 

$

2.20

 

Diluted

 

$

2.37

 

 

$

1.16

 

 

$

4.02

 

 

$

2.11

 

Weighted-average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

46,675

 

 

 

45,796

 

 

 

46,550

 

 

 

45,647

 

Diluted

 

 

48,286

 

 

 

47,754

 

 

 

48,268

 

 

 

47,732

 


SUPPLEMENTAL FINANCIAL INFORMATION
STOCK-BASED COMPENSATION EXPENSE
(Unaudited, in thousands)

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Cost of revenue

 

$

1,198

 

 

$

885

 

 

$

2,505

 

 

$

1,700

 

Research and development

 

 

9,187

 

 

 

6,752

 

 

 

17,588

 

 

 

12,918

 

Selling, general and administrative

 

 

32,530

 

 

 

24,489

 

 

 

62,633

 

 

 

46,092

 

Total stock-based compensation expense

 

$

42,915

 

 

$

32,126

 

 

$

82,726

 

 

$

60,710

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


RECONCILIATION OF NET INCOME TO NON-GAAP NET INCOME
(Unaudited, in thousands, except per share amounts)

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Net income

 

$

114,679

 

 

$

55,169

 

 

$

194,245

 

 

$

100,582

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjustments to reconcile net income to non-GAAP net income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation expense

 

 

42,915

 

 

 

32,126

 

 

 

82,726

 

 

 

60,710

 

Amortization of purchased intangible assets

 

 

33

 

 

 

-

 

 

 

66

 

 

 

-

 

Deferred compensation plan expense (income)

 

 

(302

)

 

 

290

 

 

 

(475

)

 

 

233

 

Tax effect

 

 

(314

)

 

 

(1,117

)

 

 

(1,276

)

 

 

(5,578

)

Non-GAAP net income

 

$

157,011

 

 

$

86,468

 

 

$

275,286

 

 

$

155,947

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP net income per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

3.36

 

 

$

1.89

 

 

$

5.91

 

 

$

3.42

 

Diluted

 

$

3.25

 

 

$

1.81

 

 

$

5.70

 

 

$

3.27

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shares used in the calculation of non-GAAP net income per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

46,675

 

 

 

45,796

 

 

 

46,550

 

 

 

45,647

 

Diluted

 

 

48,286

 

 

 

47,754

 

 

 

48,268

 

 

 

47,732

 


RECONCILIATION OF GROSS MARGIN TO NON-GAAP GROSS MARGIN
(Unaudited, in thousands)

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Gross profit

 

$

270,961

 

 

$

164,215

 

 

$

489,841

 

 

$

305,274

 

Gross margin

 

 

58.8

%

 

 

56.0

%

 

 

58.4

%

 

 

55.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjustments to reconcile gross profit to non-GAAP gross profit:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation expense

 

 

1,198

 

 

 

885

 

 

 

2,505

 

 

 

1,700

 

Deferred compensation plan expense (income)

 

 

(48

)

 

 

130

 

 

 

(51

)

 

 

291

 

Non-GAAP gross profit

 

$

272,111

 

 

$

165,230

 

 

$

492,295

 

 

$

307,265

 

Non-GAAP gross margin

 

 

59.0

%

 

 

56.3

%

 

 

58.7

%

 

 

56.1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


RECONCILIATION OF OPERATING EXPENSES TO NON-GAAP OPERATING EXPENSES
(Unaudited, in thousands)

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Total operating expenses

 

$

129,073

 

 

$

103,587

 

 

$

251,819

 

 

$

198,560

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjustments to reconcile total operating expenses to non-GAAP total operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation expense

 

 

(41,717

)

 

 

(31,241

)

 

 

(80,221

)

 

 

(59,010

)

Amortization of purchased intangible assets

 

 

(33

)

 

 

-

 

 

 

(66

)

 

 

-

 

Deferred compensation plan income (expense)

 

 

5,338

 

 

 

(2,022

)

 

 

7,701

 

 

 

(2,981

)

Non-GAAP operating expenses

 

$

92,661

 

 

$

70,324

 

 

$

179,233

 

 

$

136,569

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


RECONCILIATION OF OPERATING INCOME TO NON-GAAP OPERATING INCOME
(Unaudited, in thousands)

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Total operating income

 

$

141,888

 

 

$

60,628

 

 

$

238,022

 

 

$

106,714

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjustments to reconcile total operating income to non-GAAP total operating income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation expense

 

 

42,915

 

 

 

32,126

 

 

 

82,726

 

 

 

60,710

 

Amortization of purchased intangible assets

 

 

33

 

 

 

-

 

 

 

66

 

 

 

-

 

Deferred compensation plan expense (income)

 

 

(5,387

)

 

 

2,152

 

 

 

(7,752

)

 

 

3,272

 

Non-GAAP operating income

 

$

179,449

 

 

$

94,906

 

 

$

313,062

 

 

$

170,696

 


RECONCILIATION OF OTHER INCOME (EXPENSE), NET, TO NON-GAAP OTHER INCOME (EXPENSE), NET
(Unaudited, in thousands)

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Total other income (expense), net

 

$

(5,092

)

 

$

3,031

 

 

$

(5,726

)

 

$

5,618

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjustments to reconcile other income (expense), net to non-GAAP other income (expense), net:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Deferred compensation plan expense (income)

 

 

5,085

 

 

 

(1,862

)

 

 

7,277

 

 

 

(3,039

)

Non-GAAP other income (expense), net

 

$

(7

)

 

$

1,169

 

 

$

1,551

 

 

$

2,579

 


RECONCILIATION OF INCOME BEFORE INCOME TAXES TO NON-GAAP INCOME BEFORE INCOME TAXES
(Unaudited, in thousands)

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Total income before income taxes

 

$

136,796

 

 

$

63,659

 

 

$

232,296

 

 

$

112,332

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjustments to reconcile income before income taxes to non-GAAP income before income taxes:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock-based compensation expense

 

 

42,915

 

 

 

32,126

 

 

 

82,726

 

 

 

60,710

 

Amortization of purchased intangible assets

 

 

33

 

 

 

-

 

 

 

66

 

 

 

-

 

Deferred compensation plan expense (income)

 

 

(302

)

 

 

290

 

 

 

(475

)

 

 

233

 

Non-GAAP income before income taxes

 

$

179,442

 

 

$

96,075

 

 

$

314,613

 

 

$

173,275

 


2022 THIRD QUARTER OUTLOOK
RECONCILIATION OF GROSS MARGIN TO NON-GAAP GROSS MARGIN
(Unaudited)

 

 

Three Months Ending

 

 

 

September 30, 2022

 

 

 

Low

 

 

High

 

Gross margin

 

 

58.4

%

 

 

59.0

%

Adjustment to reconcile gross margin to non-GAAP gross margin:

 

 

 

 

 

 

 

 

Stock-based compensation expense

 

 

0.3

%

 

 

0.3

%

Non-GAAP gross margin

 

 

58.7

%

 

 

59.3

%


RECONCILIATION OF R&D AND SG&A EXPENSES TO NON-GAAP R&D AND SG&A EXPENSES
(Unaudited, in thousands)

 

 

Three Months Ending

 

 

 

September 30, 2022

 

 

 

Low

 

 

High

 

R&D and SG&A expenses

 

$

136,200

 

 

$

140,200

 

Adjustments to reconcile R&D and SG&A expenses to non-GAAP R&D and SG&A expenses:

 

 

 

 

 

 

 

 

Stock-based compensation expense

 

 

(41,500

)

 

 

(43,500

)

Non-GAAP R&D and SG&A expenses

 

$

94,700

 

 

$

96,700