Monolithic Power Systems Announces Results for the Third Quarter and Nine Months Ended September 30, 2011

SAN JOSE, Calif., Oct. 27, 2011 /PRNewswire/ -- Monolithic Power Systems (MPS) (Nasdaq: MPWR), a leading fabless manufacturer of high-performance analog and mixed-signal semiconductors, today announced financial results for the quarter and nine months ended September 30, 2011.

The results for the quarter ended September 30, 2011 are as follows:

• Net revenues of $53.0 million, a 2.6% increase from $51.6 million in the second quarter of 2011 and a 19.6% decrease from $65.8 million in the third quarter of 2010.
• Gross margin of 52.5%, an increase from 51.4% in the second quarter of 2011 and a 2.2% decrease from 54.7% in the third quarter of 2010.
• GAAP operating expenses of $22.8 million, including $22.1 million for research and development and selling, general and administrative expenses, which include $3.3 million for stock-based compensation, and $0.7 million for litigation expenses.  Comparatively, for the three months ended September 30, 2010, GAAP operating expenses were $22.6 million, including $21.6 million for research and development and selling, general and administrative expenses, which includes $4.1 million for stock-based compensation and $1.0 million for litigation expenses.
• Non-GAAP(1) operating expenses of $19.5 million, excluding $3.3 million for stock-based compensation, compared to $18.5 million, excluding $4.1 million for stock-based compensation for the three months ended September 30, 2010.
• GAAP net income of $5.5 million, with GAAP earnings per share of $0.16 per diluted share.  Comparatively, GAAP net income was $13.2 million, with GAAP earnings per share of $0.35 per diluted share for the quarter ended September 30, 2010.
• Non-GAAP(1) net income of $7.8 million, with non-GAAP earnings per share of $0.23 per diluted share, excluding stock-based compensation and related tax effects, compared to non-GAAP net income of $16.4 million, with non-GAAP earnings per share of $0.43 per diluted share, excluding stock-based compensation and related tax effects for the quarter ended September 30, 2010.

The results for the nine months ended September 30, 2011 are as follows:

• Net revenues of $149.1 million, compared to $171.8 million for the nine months ended September 30, 2010, a decrease of 13.2%.
• Gross margin of 51.4%, compared to 56.9% for the nine months ended September 30, 2010.
• GAAP operating expenses of $65.7 million, including $63.2 million for research and development and selling, general and administrative expenses, which includes $9.8 million for stock-based compensation, and $2.5 million for patent litigation expenses. Comparatively, GAAP operating expenses of $71.2 million, including $66.4 million for research and development and selling, general and administrative expenses, which includes $13.5 million for stock-based compensation, and $4.8 million for patent litigation expenses for the nine months ended September 30, 2010.
• Non-GAAP(1) operating expenses of $55.9 million, excluding $9.8 million for stock-based compensation, compared to $57.7 million, excluding $13.5 million in stock-based compensation for the nine months ended September 30, 2010.
• GAAP net income of $10.8 million, with GAAP EPS of $0.31 per diluted share compared to GAAP net income of $26.0 million, with GAAP EPS of $0.68 per diluted share for the nine months ended September 30, 2010.
• Non-GAAP(1) net income of $19.7 million, with non-GAAP earnings per share of $0.56 per diluted share, excluding stock-based compensation and related tax effects compared to non-GAAP net income of $37.9 million, with non-GAAP earnings per share of $1.00 per diluted share, excluding stock-based compensation and related tax effects for the nine months ended September 30, 2010.

"In the midst of this economic slowdown, I am pleased with the strong design win activity," said Michael Hsing, CEO and founder of MPS. "We are releasing many leading-edge products. We are continuing to grow and diversify our product portfolio and will be well positioned when the economy turns around."

Business Outlook

The following are MPS' financial targets for the fourth quarter ending December 31, 2011:

• Revenues in the range of $44.5 million to $48.5 million.
• Gross margin in the range of 50.0% to 51.0%.
• Research and development and selling, general and administrative expenses between $20.4 million and $21.8 million. Non-GAAP(1) research and development and selling, general and administrative expenses between $17.8 million and $18.8 million. This excludes an estimate of stock-based compensation expense in the range of 2.6 million to $3.0 million.
• Litigation expense in the range of $0.9 million to $1.1 million.

(1) Non-GAAP net income, non-GAAP earnings, non-GAAP operating expenses and non-GAAP research and development and selling, general and administrative expense differ from net income, earnings, operating expenses, and research and development and selling, general and administrative expense determined in accordance with GAAP (Generally Accepted Accounting Principles in the United States). Non-GAAP net income for the quarter and nine months ended September 30, 2011 and 2010 excludes the effect of stock-based compensation expense and its related tax effect. Non-GAAP operating expenses for the quarter and nine months ended September 30, 2011 and 2010 exclude the effect of stock-based compensation expense. Projected non-GAAP research and development and selling, general and administrative 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. Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. 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' 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 financials measures used by MPS.

Conference Call

MPS plans to conduct an investor teleconference covering its quarter and nine months ended September 30, 2011 results at 2:00 p.m. PT / 5:00 p.m. ET today, October 27, 2011. To access the conference call and the following replay of the conference call, go to http://ir.monolithicpower.com and click on the webcast link. From this site, you can listen to the teleconference, assuming that your computer system is configured properly. In addition to the webcast replay, which will be archived for all investors for one year on the MPS website, a phone replay will be available for seven days after the live call at 404-537-3406, code number 18543644. This press release and any other information related to the call will also be posted on the website.

Safe Harbor Statement

This press release contains forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995, including, among other things, (i) projected revenues, gross margin, GAAP and non-GAAP research and development and selling, general and administrative expenses, stock-based compensation expense and litigation expense for the quarter ending December 31, 2011, (ii) our outlook for the long term prospects of the company, including the prospects of our new product families, (iii) our ability to penetrate new markets and expand our market share, (iv) our expected pricing practices in 2011, (v) the seasonality of our business, (vi) our ability to reduce our manufacturing costs, and (vii) statements of the assumptions underlying or relating to any statement described in (i), (ii), (iii), (iv), (v) or (vi). 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' products, in particular the new products launched within the past 18 months, being different than expected; competition generally and the increasingly competitive nature of our industry; any market disruptions or interruptions in MPS' schedule of new product release development; adverse changes in production and testing efficiency of our products; adverse changes in government regulations in foreign countries where MPS has offices or operations; the effect of catastrophic events; adequate supply of our products from our third-party manufacturer; the risks, uncertainties and costs of litigation in which the Company is involved; the outcome of any upcoming trials, hearings, motions and appeals; the adverse impact on MPS' financial performance if its tax and litigation provisions are inadequate; adverse changes or developments in the semiconductor industry generally; difficulty in predicting or budgeting for future customer demand and channel inventories, expenses and financial contingencies; and other important risk factors identified in MPS' SEC filings, including, but not limited to, its Form 10-K filed on March 4, 2011 and its Form 10-Q filed on August 9, 2011.

The forward-looking statements in this press release represent MPS' 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 conference call.

About Monolithic Power Systems, Inc.

Monolithic Power Systems, Inc. (MPS) develops and markets proprietary, advanced analog and mixed-signal semiconductors. The company combines advanced process technology with its highly experienced analog designers to produce high-performance power management integrated circuits (ICs) for DC to DC converters, LED drivers, Cold Cathode Fluorescent Lamp (CCFL) backlight controllers, Class D audio amplifiers, and Linear ICs. MPS products are used extensively in computing and network communications products, LCD monitors and TVs, and a wide variety of consumer and portable electronics products. MPS partners with world-class manufacturing organizations to deliver top quality, ultra-compact, high-performance solutions through the most productive, cost-efficient channels. Founded in 1997 and headquartered in San Jose, California, the company has expanded its global presence with sales offices in Taiwan, China, Korea, Japan, and Europe, which operate under MPS International, Ltd.

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.

SOURCE Monolithic Power Systems, Inc.

WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM?

440k+
Newsrooms &
Influencers

9k+
Digital Media
Outlets

270k+
Journalists
Opted In

GET STARTED