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Semtech Corp., a leading supplier of analog and mixed-signal semiconductors, today reported unaudited financial results for its fiscal year 2014 third quarter, which ended October 27, 2013.
Net revenue for the third quarter of fiscal year 2014 was $141.0 million, down 12 percent from the third quarter of fiscal year 2013 and down 15 percent from the second quarter of fiscal year 2014.
Gross profit margin, computed in accordance with U.S. generally accepted accounting principles (GAAP), for the third quarter of fiscal year 2014 was 59.1 percent compared to 60.2 percent in the third quarter of fiscal year 2013 and 61.0 percent in the second quarter of fiscal year 2014.
GAAP net income for the third quarter of fiscal year 2014 was $12.5 million or 18 cents per diluted share. This compares to GAAP net income of $16.6 million or 25 cents per diluted share in the third quarter of fiscal year 2013 and GAAP net income of $19.1 million or 28 cents per diluted share in the second quarter of fiscal year 2014.
To facilitate the complete understanding of comparable financial performance between periods, Semtech also presents performance results net of certain non-cash and one-time items. Semtech's non-GAAP results exclude the following items:
- Stock-based compensation expense
- Environmental monitoring and remediation reserves
- Acquisition related fair value adjustments
- Intangible amortization and impairments
- Transaction and integration related expenses
- Write-off of deferred financing costs and refinancing fees
- Release of prior accrued taxes on foreign earnings
Excluding the items listed above, Non-GAAP net income for the third quarter of fiscal year 2014 was $24.1 million or 35 cents per diluted share. Non-GAAP net income was $36.1 million or 53 cents per diluted share in the third quarter of fiscal year 2013 and was $35.8 million or 52 cents per diluted share in the second quarter of fiscal year 2014.
Non-GAAP gross profit margin for the third quarter of fiscal year 2014 was 59.4 percent. Non-GAAP gross profit margin for the third quarter of fiscal year 2013 was 63.1 percent and 61.3 percent in the second quarter of fiscal year 2014.
As of October 27, 2013, Semtech had $241.8 million in cash, cash equivalents and marketable securities, compared to $218.0 million in cash, cash equivalents and marketable securities at the end of the third quarter of fiscal year 2013 and $242.0 million in cash, cash equivalents and marketable securities at the end of the second quarter of fiscal year 2014.
Mohan Maheswaran, Semtech's President and Chief Executive Officer, stated, "While the third quarter presented the expected challenges, Semtech remains on track to deliver another year of record revenues in fiscal year 2014. Our business remains balanced and we were very pleased with our record level of design wins and strong new product releases. We continue to be highly focused on driving our new growth initiatives to keep us moving forward in achieving our $1 billion revenue goal.”
The results announced today are preliminary, as they are subject to customary quarterly review procedures by the Company's independent registered public accounting firm. As such, these results are subject to revision until the Company will have filed its quarterly report on Form 10-Q for the third quarter of fiscal year 2014.
Fourth Quarter of Fiscal Year 2014 Outlook
- Net sales are expected to be in the range of $132.0 million to $144.0 million
- GAAP gross profit margin is expected to be in the range of 58.8% to 60.0%
- Non-GAAP gross profit margin is expected to be in the range of 59.2% to 60.2%
- GAAP SG&A expense is expected to be in the range of $31.0 million to $32.0 million
- GAAP R&D expense is expected to be in the range of $30.8 million to $31.8 million
- Stock-based compensation expense, which is included in the preceding estimates, is expected to be approximately $7.3 million, categorized as follows: $0.5 million cost of sales, $3.8 million SG&A, and $3.1 million R&D
- Amortization of acquired intangible assets is expected to be approximately $8.0 million
- Transaction and integration related expenses of approximately $1.0 million
- Interest and other expense is expected to be approximately $1.8 million
- GAAP tax rate is expected to be a provision of approximately 2.0%
- Non-GAAP tax rate is expected to be approximately 13.0%
- GAAP earnings are expected to be in the range of 9 to 18 cents per diluted share
- Non-GAAP earnings are expected to be in the range of 29 to 37 cents per diluted share
- Fully diluted share count is expected to be approximately 68.5 million shares
- Capital expenditures are expected to be approximately $8.0 million