Silicon Labs Reports Fourth Quarter 2024 Results

Wireless IoT leader delivers in-line fourth-quarter results and guides to sequential growth in first quarter

Silicon Labs(NASDAQ: SLAB), a leader in secure, intelligent wireless technology for a more connected world, reported financial results for the fourth quarter, which ended December28, 2024.

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“The Silicon Labs team executed well to close out 2024, with fourth quarter revenue nearly doubling from the same quarter one year ago,” said Matt Johnson, President and Chief Executive Officer at Silicon Labs. “Looking ahead, we expect sequential revenue growth to resume beginning in the first quarter and are encouraged by our 2025 outlook as design wins across several key focus areas continue to ramp into production throughout the year.”

FourthQuarter Financial Highlights

— Revenue was $166 million

— Industrial & Commercial revenue for the quarter was $89 million, down 8% sequentially

— Home & Life revenue for the quarter was $78 million, up 11% sequentially

Results on a GAAP basis:

— GAAP gross margin was 54.3%

— GAAP operating expenses were $119 million

— GAAP operating loss was $29 million

— GAAP diluted loss per share was $(0.73)

Results on a non-GAAP basis, excluding the impact of stock compensation, amortization of acquired intangible assets, and certain other items as set forth in the below GAAP to Non-GAAP reconciliation tables were as follows:

— Non-GAAP gross margin was 54.6%

— Non-GAAP operating expenses were $98 million

— Non-GAAP operating loss was $7 million

— Non-GAAP diluted loss per share was $(0.11)

Business Outlook

The company expects first-quarter revenue to be between $170 to $185 million. The company also estimates the following results:

On a GAAP basis:

— GAAP gross margin to be between 54% to 56%

— GAAP operating expenses of approximately $128 million to $130 million

— GAAP diluted loss per share between $(0.75) to $(1.05)

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

— Non-GAAP gross margin to be between 54% to 56%

— Non-GAAP operating expenses of approximately $103 million to $105 million

— Non-GAAP diluted earnings (loss) per share between $0.01 to $(0.19)

Earnings Webcast and Conference Call

Silicon Labs will host an earnings conference call to discuss the quarterly results and answer questions at 7:30 am CDT today. An audio webcast will be available on Silicon Labs' website (www.silabs.com) under Investor Relations. In addition, the company will post an audio recording of the event at investor.silabs.com and make a replay available through March 6, 2025.

About Silicon Labs

Silicon Labs (NASDAQ: SLAB) is a leader in secure, intelligent wireless technology for a more connected world. Our integrated hardware and software platform, intuitive development tools, thriving ecosystem, and robust support make us an ideal long-term partner in building advanced industrial, commercial, home and life applications. We make it easy for developers to solve complex wireless challenges throughout the product lifecycle and get to market quickly with innovative solutions that transform industries, grow economies, and improve lives. 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: the competitive and cyclical nature of the semiconductor industry; the challenging macroeconomic environment, including tariffs or any other policy changes; 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 or pandemics, war and political unrest; risks that demand and the supply chain may be adversely affected by military conflict (including in the Middle East, and between Russia and Ukraine), terrorism, sanctions or other geopolitical events globally (including in the Middle East, and conflict between Taiwan and China); 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; risks associated with international activities (including trade barriers, particularly with respect to China); intellectual property litigation risks; risks associated with acquisitions and divestitures; product liability risks; difficulties managing and/or obtaining sufficient supply from Silicon Labs' distributors, manufacturers and subcontractors; dependence on a limited number of products; absence of long-term commitments from customers; 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 its accounts receivable; dependence on key personnel; stock price volatility; the impact of public health crises on the U.S. and global economy; debt-related risks; capital-raising risks; the timing and scope of share repurchases and/or dividends; average selling prices of products may decrease significantly and rapidly; information technology risks; cyber-attacks against Silicon Labs' products and its networks; risks associated with any material weakness in our internal controls over financial reporting; 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, and the Silicon Labs logo are trademarks of Silicon Laboratories Inc. All other product names noted herein may be trademarks of their respective holders.

Silicon Laboratories Inc.Condensed Consolidated Statements of Operations(In thousands, except per share data)(Unaudited) Three Months Ended Year Ended December 28, December 30, December 28, December 30, 2024 2023 2024 2023Revenues $ 166,249 $ 86,845 $ 584,386 $ 782,258Cost of revenues 76,026 42,919 272,198 321,672Gross profit 90,223 43,926 312,188 460,586Operating expenses:Research and development 82,438 83,404 332,225 337,744Selling, general and administrative 36,412 33,633 145,453 146,996Operating expenses 118,850 117,037 477,678 484,740Operating loss (28,627) (73,111) (165,490) (24,154)Other income (expense):Interest income and other, net 2,978 3,610 11,987 19,165Interest expense (260) (942) (1,310) (5,554)Loss before income taxes (25,909) (70,443) (154,813) (10,543)Provision (benefit) for income taxes (2,086) (15,536) 36,197 7,943Equity-method loss – (14,880) – (16,030)Net loss $ (23,823) $ (69,787) $ (191,010) $ (34,516)Loss per share:Basic $ (0.73) $ (2.19) $ (5.93) $ (1.09)Diluted $ (0.73) $ (2.19) $ (5.93) $ (1.09)Weighted-average common shares outstanding:Basic 32,420 31,848 32,191 31,804Diluted 32,420 31,848 32,191 31,804

Non-GAAP Financial Measurements

In addition to the GAAP results provided throughout this document, Silicon Labs has provided non-GAAP financial measurements on a basis excluding non-cash and other charges and benefits. Details of these excluded items are presented in the tables below, which reconcile the GAAP results to non-GAAP financial measurements.

The non-GAAP financial measurements do not replace the presentation of Silicon Labs' GAAP financial results. These measurements provide supplemental information to assist management and investors in analyzing Silicon Labs' financial position and results of operations. Silicon Labs has chosen to provide this information to investors to enable them to perform meaningful comparisons of past, present and future operating results and as a means to emphasize the results of core on-going operations.

Unaudited Reconciliation of GAAP to Non-GAAP Financial Measures(In thousands, except per share data) Three Months Ended December 28, 2024Non-GAAP Income Statement Items GAAP GAAP Stock Intangible Asset Non-GAAP Non-GAAP Measure Percent of Compensation Amortization Measure Percent of Revenue Expense RevenueRevenues $ 166,249Gross profit 90,223 54.3% $ 485 $ – $ 90,708 54.6%Research and development 82,438 49.6% 10,199 5,437 66,802 40.2%Selling, general and administrative 36,412 21.9% 5,460 – 30,952 18.6%Operating expenses 118,850 71.5% 15,659 5,437 97,754 58.8%Operating income (loss) (28,627) (17.2%) 16,144 5,437 (7,046) (4.2%) Three Months Ended December 28, 2024Non-GAAP Loss Per Share GAAP Stock Intangible Income Non- Measure Compensation Asset Tax GAAP Expense* Amortization* Adjustments MeasureNet income (loss) $ (23,823) $ 16,144 $ 5,437 $ (1,221) $ (3,463)Diluted shares outstanding 32,420 32,420Diluted loss per share $ (0.73) $ (0.11)* Represents pre-tax amountsUnaudited Forward-Looking Statements Regarding Business Outlook(In millions, except per share data) Three Months Ended April 5, 2025Business Outlook GAAP Non-GAAP Non-GAAP Measure Adjustments** MeasureGross margin 54% to 56% -% 54% to 56%Operating expenses $128 to $130 $(25) $103 to $105Diluted earnings (loss) per share $(0.75) to $(1.05) $0.76 to $0.86 $0.01 to $(0.19)** Non-GAAP adjustments include the following estimates: stock compensation expense of $20.1 million, intangible asset amortization of $5.4 million, and the application of a long-term non-GAAP tax rate of 20%.Silicon Laboratories Inc.Condensed Consolidated Balance Sheets(In thousands, except per share data)(Unaudited) December 28, December 30, 2024 2023AssetsCurrent assets:Cash and cash equivalents $ 281,607 $ 227,504Short-term investments 100,554 211,720Accounts receivable, net 54,479 29,295Inventories 105,639 194,295Prepaid expenses and other current assets 59,754 75,117Total current assets 602,033 737,931Property and equipment, net 132,136 145,890Goodwill 376,389 376,389Other intangible assets, net 36,499 59,533Other assets, net 75,617 123,313Total assets $ 1,222,674 $ 1,443,056Liabilities and Stockholders' EquityCurrent liabilities:Accounts payable $ 42,448 $ 57,498Revolving line of credit – 45,000Deferred revenue and returns liability 3,073 2,117Other current liabilities 52,362 58,955Total current liabilities 97,883 163,570Other non-current liabilities 44,770 70,804Total liabilities 142,653 234,374Commitments and contingenciesStockholders' equity:Preferred stock – $0.0001 par value; 10,000 shares authorized; no shares issued – -Common stock – $0.0001 par value; 250,000 shares authorized; 31,897 and 31,994 3 3shares issued and outstanding at December 30, 2023 and December 31, 2022,respectivelyAdditional paid-in capital 78,227 16,973Retained earnings 1,001,721 1,192,731Accumulated other comprehensive income (loss) 70 (1,025)Total stockholders' equity 1,080,021 1,208,682Total liabilities and stockholders' equity $ 1,222,674 $ 1,443,056Silicon Laboratories Inc.Condensed Consolidated Statements of Cash Flows(In thousands)(Unaudited) Year Ended December 28, December 30, 2024 2023Operating ActivitiesNet loss $ (191,010) $ (34,516)Adjustments to reconcile net loss to net cash used in operating activities:Depreciation of property and equipment 25,551 25,707Amortization of other intangible assets 23,034 25,374Amortization of debt discount and debt issuance costs – 960Stock-based compensation expense 61,503 48,208Equity-method loss – 16,030Deferred income taxes 29,470 (11,815)Changes in operating assets and liabilities:Accounts receivable (25,184) 42,142Inventories 88,494 (93,398)Prepaid expenses and other assets 27,362 (10,733)Accounts payable (15,155) (25,644)Other current liabilities and income taxes (21,768) (37,793)Deferred revenue and returns liability 956 (4,663)Other non-current liabilities (17,163) 29,793Net cash used in operating activities (13,910) (30,348)Investing ActivitiesPurchases of marketable securities (73,602) (103,485)Sales of marketable securities 54,227 395,565Maturities of marketable securities 131,858 200,530Purchases of property and equipment (11,748) (22,282)Proceeds from sale of equity investment 12,382 -Purchases of other assets – (520)Net cash provided by investing activities 113,117 469,808Financing ActivitiesProceeds from issuance of debt – 80,000Payments on debt (45,000) (571,157)Repurchases of common stock (16) (217,137)Payment of taxes withheld for vested stock awards (16,434) (18,189)Proceeds from the issuance of common stock 16,346 14,612Net cash used in financing activities (45,104) (711,871)Increase (decrease) in cash and cash equivalents 54,103 (272,411)Cash and cash equivalents at beginning of period 227,504 499,915Cash and cash equivalents at end of period $ 281,607 $ 227,504

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