Cirrus Logic Reports Fiscal First Quarter Revenue of $374.0 Million

AUSTIN, Texas--(BUSINESS WIRE)--Cirrus Logic, Inc. (NASDAQ: CRUS) today posted on its website at investor.cirrus.com the quarterly Shareholder Letter that contains the complete financial results for the first quarter of fiscal year 2025, which ended June 29, 2024, as well as the company’s current business outlook.

“Cirrus Logic delivered revenue above the top end of our guidance range in the June quarter driven by stronger-than-expected shipments into smartphones,” said John Forsyth, Cirrus Logic president and chief executive officer. “In addition to these strong results, during the quarter we began ramping production of our custom boosted amplifier and first 22-nanometer smart codec ahead of new smartphone launches that are expected later this year. We also executed against our growth strategy to drive product and end-market diversification as we saw strong design activity in laptops and introduced the latest products in a series of data converters targeting professional audio, consumer, and industrial applications. With a compelling roadmap of products and an outstanding track record of execution, we believe we are well-positioned to grow long-term shareholder value.”

Reported Financial Results – First Quarter FY25

• Revenue of $374.0 million;
• GAAP and non-GAAP gross margin of 50.5 percent and 50.6 percent;
• GAAP operating expenses of $142.1 million and non-GAAP operating expenses of $118.0 million; and
• GAAP earnings per share of $0.76 and non-GAAP earnings per share of $1.12.

A reconciliation of GAAP to non-GAAP financial information is included in the tables accompanying this press release.

Business Outlook – Second Quarter FY25

• Revenue is expected to range between $490 million and $550 million;
• GAAP gross margin is forecasted to be between 50 percent and 52 percent; and
• Combined GAAP R&D and SG&A expenses are anticipated to range between $149 million and $155 million, including approximately $22 million in stock-based compensation expense and $2 million in amortization of acquired intangibles, resulting in a non-GAAP operating expense range between $125 million and $131 million.

Cirrus Logic will host a live Q&A session at 5 p.m. EDT today to discuss its financial results and business outlook. Participants may listen to the conference call on the investor relations website at investor.cirrus.com. A replay of the webcast can be accessed on the Cirrus Logic website approximately two hours following its completion or by calling [phone] or toll-free at [phone] (Access Code: 95424).

About Cirrus Logic, Inc.

Cirrus Logic is a leader in low-power, high-precision mixed-signal processing solutions that create innovative user experiences for the world’s top mobile and consumer applications. With headquarters in Austin, Texas, Cirrus Logic is recognized globally for its award-winning corporate culture.

Cirrus Logic, Cirrus and the Cirrus Logic logo are registered trademarks of Cirrus Logic, Inc. All other company or product names noted herein may be trademarks of their respective holders.

Use of non-GAAP Financial Information

To supplement Cirrus Logic's financial statements presented on a GAAP basis, the company has provided non-GAAP financial information, including non-GAAP net income, diluted earnings per share, operating income and profit, operating expenses, gross margin and profit, tax expense, tax expense impact on earnings per share, effective tax rate, free cash flow, and free cash flow margin. 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 statements about our expectation for new smartphone launches later this year; our belief that we are well-positioned to grow long-term shareholder value; and our estimates for the second quarter fiscal year 2025 revenue, gross margin, combined research and development and selling, general and administrative expense levels, stock-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, and readers should not place undue reliance on such statements. These risks and uncertainties include, but are not limited to, the following: the level and timing of orders and shipments during the second quarter of fiscal year 2025, customer cancellations of orders, or the failure to place orders consistent with forecasts, along with the risk factors listed in our Form 10-K for the year ended March 30, 2024 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 expressly disclaim any obligation to update or revise any forward-looking statements, whether as a result of new developments or otherwise.

Summary Financial Data Follows:

CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
(in thousands, except per share data; unaudited)
	Three Months Ended
	Jun. 29,			Mar. 30,			Jun. 24,
		2024			2024			2023
	Q1'25			Q4'24			Q1'24
Audio	$	218,970		$	226,681		$	195,806
High-Performance Mixed-Signal		155,056			145,146			121,210
Net sales		374,026			371,827			317,016
Cost of sales		185,101			179,202			157,629
Gross profit		188,925			192,625			159,387
Gross margin		50.5	%		51.8	%		50.3	%
Research and development		105,363			103,383			106,215
Selling, general and administrative		36,770			36,866			35,379
Total operating expenses		142,133			140,249			141,594
Income from operations		46,792			52,376			17,793
Interest income		8,202			7,360			4,600
Other income (expense)		1,609			(78	)		377
Income before income taxes		56,603			59,658			22,770
Provision for income taxes		14,508			14,816			7,170
Net income	$	42,095		$	44,842		$	15,600
Basic earnings per share	$	0.79		$	0.83		$	0.28
Diluted earnings per share:	$	0.76		$	0.81		$	0.28
Weighted average number of shares:
Basic		53,433			53,739			54,862
Diluted		55,665			55,559			56,631
Prepared in accordance with Generally Accepted Accounting Principles

RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL INFORMATION
(in thousands, except per share data; unaudited)
(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
	Jun. 29,			Mar. 30,			Jun. 24,
		2024			2024			2023
Net Income Reconciliation	Q1'25			Q4'24			Q1'24
GAAP Net Income	$	42,095		$	44,842		$	15,600
Amortization of acquisition intangibles		1,972			1,973			2,170
Stock-based compensation expense		21,385			22,158			22,715
Lease impairment		1,019			—			—
Acquisition-related costs		—			—			3,166
Adjustment to income taxes		(4,105	)		75			(5,628	)
Non-GAAP Net Income	$	62,366		$	69,048		$	38,023
Earnings Per Share Reconciliation
GAAP Diluted earnings per share	$	0.76		$	0.81		$	0.28
Effect of Amortization of acquisition intangibles		0.03			0.03			0.04
Effect of Stock-based compensation expense		0.38			0.40			0.40
Effect of Lease impairment		0.02			—			—
Effect of Acquisition-related costs		—			—			0.05
Effect of Adjustment to income taxes		(0.07	)		—			(0.10	)
Non-GAAP Diluted earnings per share	$	1.12		$	1.24		$	0.67
Operating Income Reconciliation
GAAP Operating Income	$	46,792		$	52,376		$	17,793
GAAP Operating Profit		12.5	%		14.1	%		5.6	%
Amortization of acquisition intangibles		1,972			1,973			2,170
Stock-based compensation expense - COGS		266			362			285
Stock-based compensation expense - R&D		15,763			15,483			15,952
Stock-based compensation expense - SG&A		5,356			6,313			6,478
Lease impairment		1,019			—			—
Acquisition-related costs		—			—			3,166
Non-GAAP Operating Income	$	71,168		$	76,507		$	45,844
Non-GAAP Operating Profit		19.0	%		20.6	%		14.5	%
Operating Expense Reconciliation
GAAP Operating Expenses	$	142,133		$	140,249		$	141,594
Amortization of acquisition intangibles		(1,972	)		(1,973	)		(2,170	)
Stock-based compensation expense - R&D		(15,763	)		(15,483	)		(15,952	)
Stock-based compensation expense - SG&A		(5,356	)		(6,313	)		(6,478	)
Lease impairment		1,019			—			—
Acquisition-related costs		—			—			(3,166	)
Non-GAAP Operating Expenses	$	118,023		$	116,480		$	113,828
Gross Margin/Profit Reconciliation
GAAP Gross Profit	$	188,925		$	192,625		$	159,387
GAAP Gross Margin		50.5	%		51.8	%		50.3	%
Stock-based compensation expense - COGS		266			362			285
Non-GAAP Gross Profit	$	189,191		$	192,987		$	159,672
Non-GAAP Gross Margin		50.6	%		51.9	%		50.4	%
GAAP Tax Expense	$	14,508		$	14,816		$	7,170
GAAP Effective Tax Rate		25.6	%		24.8	%		31.5	%
Adjustments to income taxes		4,105			(75	)		5,628
Non-GAAP Tax Expense	$	18,613		$	14,741		$	12,798
Non-GAAP Effective Tax Rate		23.0	%		17.6	%		25.2	%
Tax Impact to EPS Reconciliation
GAAP Tax Expense	$	0.26		$	0.27		$	0.13
Adjustments to income taxes		0.07			—			0.10
Non-GAAP Tax Expense	$	0.33		$	0.27		$	0.23

CONSOLIDATED CONDENSED BALANCE SHEET
(in thousands; unaudited)
	Jun. 29,			Mar. 30,			Jun. 24,
		2024			2024			2023
ASSETS
Current assets
Cash and cash equivalents	$	491,351		$	502,764		$	352,346
Marketable securities		25,680			23,778			35,765
Accounts receivable, net		190,079			162,478			186,033
Inventories		232,566			227,248			300,956
Prepaid wafers		84,700			86,679			84,739
Other current assets		77,365			103,245			88,829
Total current Assets		1,101,741			1,106,192			1,048,668
Long-term marketable securities		227,527			173,374			38,029
Right-of-use lease assets		136,295			138,288			125,538
Property and equipment, net		170,953			170,175			167,238
Intangibles, net		27,624			29,578			36,447
Goodwill		435,936			435,936			435,936
Deferred tax asset		54,622			48,649			44,991
Long-term prepaid wafers		50,375			60,750			110,262
Other assets		60,552			68,634			49,483
Total assets	$	2,265,625		$	2,231,576		$	2,056,592
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable	$	77,562		$	55,545		$	75,941
Accrued salaries and benefits		41,101			47,612			36,465
Lease liability		22,058			20,640			19,903
Acquisition-related liabilities		—			—			24,527
Other accrued liabilities		61,021			62,596			46,018
Total current liabilities		201,742			186,393			202,854
Non-current lease liability		132,016			134,576			125,071
Non-current income taxes		52,704			52,013			59,587
Other long-term liabilities		31,533			41,580			12,286
Total long-term liabilities		216,253			228,169			196,944
Stockholders' equity:
Capital stock		1,792,283			1,760,701			1,693,420
Accumulated earnings (deficit)		58,591			58,916			(33,621	)
Accumulated other comprehensive loss		(3,244	)		(2,603	)		(3,005	)
Total stockholders' equity		1,847,630			1,817,014			1,656,794
Total liabilities and stockholders' equity	$	2,265,625		$	2,231,576		$	2,056,592
Prepared in accordance with Generally Accepted Accounting Principles

CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
(in thousands; unaudited)
	Three Months Ended
	Jun. 29,			Jun. 24,
		2024			2023
	Q1'25			Q1'24
Cash flows from operating activities:
Net income	$	42,095		$	15,600
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization		12,359			11,941
Stock-based compensation expense		21,385			22,715
Deferred income taxes		(5,897	)		(9,411	)
Loss on retirement or write-off of long-lived assets		—			6
Other non-cash charges		1,104			1,334
Net change in operating assets and liabilities:
Accounts receivable, net		(27,601	)		(35,560	)
Inventories		(5,318	)		(67,506	)
Prepaid wafers		12,354			—
Other assets		(5,459	)		8,101
Accounts payable and other accrued liabilities		12,037			(10,278	)
Income taxes payable		30,102			20,079
Acquisition-related liabilities		—			3,166
Net cash provided by (used in) operating activities		87,161			(39,813	)
Cash flows from investing activities:
Maturities and sales of available-for-sale marketable securities		12,646			11,048
Purchases of available-for-sale marketable securities		(69,060	)		(13,372	)
Purchases of property, equipment and software		(9,990	)		(12,310	)
Investments in technology		(155	)		—
Net cash used in investing activities		(66,559	)		(14,634	)
Cash flows from financing activities:
Net proceeds from the issuance of common stock		10,196			560
Repurchase of stock to satisfy employee tax withholding obligations		(1,219	)		(1,047	)
Repurchase and retirement of common stock		(40,992	)		(38,504	)
Net cash used in financing activities		(32,015	)		(38,991	)
Net decrease in cash and cash equivalents		(11,413	)		(93,438	)
Cash and cash equivalents at beginning of period		502,764			445,784
Cash and cash equivalents at end of period	$	491,351		$	352,346
Prepared in accordance with Generally Accepted Accounting Principles

RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL INFORMATION
(in thousands; unaudited)
Free cash flow, a non-GAAP financial measure, is GAAP cash flow from operations (or cash provided by operating activities) less capital expenditures. Capital expenditures include purchases of property, equipment and software as well as investments in technology, as presented within our GAAP Consolidated Condensed Statement of Cash Flows. Free cash flow margin represents free cash flow divided by revenue.
	Twelve Months Ended			Three Months Ended
	Jun. 29,			Jun. 29,			Mar. 30,			Dec. 30,			Sep. 23,
		2024			2024			2024			2023			2023
	Q1'25			Q1'25			Q4'24			Q3'24			Q2'24
Net cash provided by (used in) operating activities (GAAP)	$	548,648		$	87,161		$	170,526		$	313,692		$	(22,731	)
Capital expenditures		(36,180	)		(10,145	)		(7,695	)		(9,813	)		(8,527	)
Free Cash Flow (Non-GAAP)	$	512,468		$	77,016		$	162,831		$	303,879		$	(31,258	)
Cash Flow from Operations as a Percentage of Revenue (GAAP)		30	%		23	%		46	%		51	%		(5	)%
Capital Expenditures as a Percentage of Revenue (GAAP)		2	%		3	%		2	%		2	%		2	%
Free Cash Flow Margin (Non-GAAP)		28	%		21	%		44	%		49	%		(6	)%

RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL INFORMATION
(in millions; unaudited)
(not prepared in accordance with GAAP)
	Q2 FY25
	Guidance
Operating Expense Reconciliation
GAAP Operating Expenses	$	149 - 155
Stock-based compensation expense		(22	)
Amortization of acquisition intangibles		(2	)
Non-GAAP Operating Expenses	$	125 - 131