Cirrus Logic : Press Release Q4FY2022 (PDF)

FINANCIAL NEWS

Cirrus Logic Reports Fourth Quarter Revenue of $490.0 Million and Full

Fiscal Year 2022 Revenue of $1.78 Billion

Content Gains Drove Record Fourth Quarter and Full Fiscal Year Revenue and EPS

AUSTIN, Texas - May 3, 2022 - 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 fourth quarter and full fiscal year 2022, which ended March 26, 2022, as well as the company's current business outlook.

"We delivered strong financial results in FY22 as revenue increased 30 percent year over year driven by high-performance mixed-signal content gains," said John Forsyth, Cirrus Logic president and chief executive officer. "In FY22, the company successfully executed several key strategic initiatives and increased product diversification through significant growth in our high-performance mixed-signal business. Going forward, we expect to continue leveraging our expertise in data conversion and signal processing to capitalize on exciting opportunities in new applications and markets."

Reported Financial Results - Fourth Quarter FY22

• • Revenue of $490.0 million;

• • GAAP gross margin of 52.8 percent and non-GAAP gross margin of 52.9 percent;

• • GAAP operating expenses of $150.9 million and non-GAAP operating expenses of $123.1 million; and

• • GAAP earnings per share of $1.64 and non-GAAP earnings per share of $2.01.

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

Reported Financial Results - Full Year FY22

• • Revenue of $1.78 billion;

• • GAAP gross margin of 51.8 percent and non-GAAP gross margin of 52.1 percent;

• • GAAP operating expenses of $557.3 million and non-GAAP operating expenses of $456.2 million; and

• • GAAP earnings per share of $5.52 and non-GAAP earnings per share of $6.90.

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

Business Outlook - First Quarter FY23

• • Revenue is expected to range between $350 million and $390 million;

• • GAAP gross margin is forecasted to be between 49 percent and 51 percent; and

• • Combined GAAP R&D and SG&A expenses are anticipated to range between $147 million and $153 million, including approximately $19 million in stock-based compensation expense, $8 million in amortization of acquired intangibles and $3 million in acquisition-related costs.

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. Participants who have questions that they would like addressed are requested to [e-mail]. 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: 8385942).

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.

Investor Contact: Chelsea Heffernan

Vice President, Investor Relations Cirrus Logic, Inc.

[phone]

[e-mail]

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, and free cash flow. 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 ability to continue to leverage our expertise in data conversion and signal processing to capitalize on exciting opportunities in new applications and markets and our estimates for the first quarter fiscal year 2023 revenue, gross margin, combined research and development and selling, general and administrative expense levels, stock compensation expense, amortization of acquired intangibles and acquisition-related costs. 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 effects of the global COVID-19 outbreak and the measures taken to limit the spread of COVID-19, including any disruptions to our business that could result from measures to contain the outbreak that may be taken by governmental authorities in the jurisdictions in which we and our supply chain operate; the susceptibility of the markets we address to economic downturns, including as a result of the COVID-19 outbreak and the actions taken to mitigate the spread of COVID-19; the risks of doing business internationally, including increased import/export restrictions and controls (e.g., the effect of the U.S. Bureau of Industry and Security of the U.S. Department of Commerce placing Huawei Technologies Co., Ltd. and certain of its affiliates on the Bureau's Entity List), imposition of trade protection measures (e.g., tariffs or taxes), security and health risks, possible disruptions in transportation networks, and other economic, social, military and geo-political conditions in the countries in which we, our customers or our suppliers operate; recent increased industry-wide capacity constraints that may impact our ability to meet current customer demand, which could cause an unanticipated decline in our sales and damage our existing customer relationships and our ability to establish new customer relationships; the potential for increased prices due to capacity constraints in oursupply chain, which, if we are unable to increase our selling price to our customers, could result in lower revenues and margins that could adversely affect our financial results; our ability to attract, hire, and retain qualified personnel to support the development, marketing, and sales of our products; the level of orders and shipments during the first quarter of fiscal year 2023, 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 27, 2021 and in our other filings with the Securities and Exchange Commission, which are available atwww.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

(unaudited)

(in thousands, except per share data)

Three Months Ended

Twelve Months EndedMar. 26, 2022 Q4'22

Dec. 25, 2021 Q3'22

Mar. 27, 2021 Q4'21

Mar. 26, 2022 Q4'22

Mar. 27, 2021 Q4'21

Audio

$

High-Performance Mixed-Signal Net sales

Cost of sales

Gross profit Gross margin

• 327,099 $ 162,873 489,972 231,243 258,729 52.8%

• 341,897 $ 206,452 548,349 258,827 289,522 52.8%

• 235,821 $ 1,187,126

57,716 293,537 145,418 148,119 50.5%

594,334 1,781,460 857,819 923,641 51.8%

$ 1,104,060 265,170 1,369,230 661,929 707,301 51.7%

Research and development Selling, general and administrative Restructuring costs

Total operating expenses

111,394 39,470 - 150,864

107,101 38,247 - 145,348

89,773 33,642 - 123,415

406,307 342,759

150,996 127,008

- 557,303

352 470,119

Income from operations

107,865

144,174

24,704

366,338 237,182

Interest income (expense)

(103)

(78)

Other income (expense)

Income before income taxes Provision for income taxes Net income

180 107,942 11,528

(87) 144,009 16,373

1,064 2,152 27,920 2,639

615 5,224

1,710 2,840

368,663 245,246

42,308 27,902

$

96,414

$

127,636

$

25,281

Basic earnings per share: Diluted earnings per share:

$ $

1.69 1.64

$ $

2.23 2.16

• $ 0.44

• $ 0.42

Weighted average number of shares:

Basic

Diluted

56,993 58,625

57,178 57,899 59,031 59,922

$	326,355	$	217,344
$	5.70	$	3.74
$	5.52	$	3.62
57,278	58,106
59,143	60,060

Prepared in accordance with Generally Accepted Accounting Principles

RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL INFORMATION

(unaudited, in thousands, except per share data)

(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

Twelve Months EndedMar. 26, 2022

Dec. 25, 2021

Mar. 27, 2021

Mar. 26, 2022

Mar. 27, 2021

Net Income Reconciliation GAAP Net Income

Q4'22

Q3'22

Q4'21

Q4'22

Q4'21

$

• 96,414 $

• 127,636 $

Amortization of acquisition intangibles Stock-based compensation expense Restructuring costs Acquisition-related costs Adjustment to income taxes Non-GAAP Net Income

7,882

9,083

17,024 -

17,833 -

3,164

3,155

(6,778)

(7,903)

• 25,281 $ 2,998 14,693 - - (3,251)

326,355 $ 217,344

27,017 11,992

66,392 56,762

- 352

12,153 (23,675)

- (11,423)

$

117,706

$

149,804

$

39,721

$

408,242

$

275,027

Earnings Per Share Reconciliation GAAP Diluted earnings per share

$

• 1.64 $

• 2.16 $

Effect of Amortization of acquisition intangibles Effect of Stock-based compensation expense Effect of Restructuring costs

0.14

0.16

0.29 -

0.30 -

Effect of Acquisition-related costs Effect of Adjustment to income taxes Non-GAAP Diluted earnings per share

0.05

0.05

(0.11)

(0.13)

• 0.42 $ 0.05 0.24 - - (0.05)

5.52 $ 3.62

0.46 0.20

1.12 0.94

- 0.01

0.20 (0.40)

- (0.19)

$

2.01

$

2.54

$

0.66

$

6.90

$

4.58

Operating Income Reconciliation GAAP Operating Income GAAP Operating Profit

$

• 107,865 $ 22.0%

• 144,174 $ 26.3%

• 24,704 $ 8.4%

366,338 $ 237,182

20.6% 17.3%

Amortization of acquisition intangibles Stock-based compensation expense - COGS Stock-based compensation expense - R&D Stock-based compensation expense - SG&A Restructuring costs

7,882

9,083

2,998

27,017 11,992

261

245

260

1,024 900

11,786

12,260

10,069

44,154 37,483

4,977 -

5,328 -

Acquisition-related costs Non-GAAP Operating Income Non-GAAP Operating Profit

3,164

3,155

4,364 - -

21,214 18,379

- 352

12,153

-

$

135,935 27.7%

$

174,245 31.8%

$

42,395 14.4%

$

471,900 26.5%

$

306,288 22.4%

Operating Expense Reconciliation GAAP Operating Expenses Amortization of acquisition intangibles Stock-based compensation expense - R&D Stock-based compensation expense - SG&A Restructuring costs

$

150,864

$

145,348

$

123,415

$

557,303

$

470,119

(7,882)

(9,083)

(11,786)

(12,260)

(4,977)

(5,328)

(2,998) (10,069) (4,364)

• (27,017) (11,992)

• (44,154) (37,483)

• (21,214) (18,379)

-

-

Acquisition-related costs Non-GAAP Operating Expenses

(3,164)

(3,155)

$

123,055

$

115,522

$

- - 105,984

- (8,692)

(352) -

$

456,226

$

401,913

Gross Margin/Profit Reconciliation GAAP Gross Profit

$

GAAP Gross Margin Acquisition-related costs

Stock-based compensation expense - COGS Non-GAAP Gross Profit

$

258,729 52.8% - 261 258,990

$

$

289,522 52.8% - 245 289,767

$

$

148,119 50.5% - 260 148,379

$

• 923,641 $ 51.8% 3,461 1,024

707,301 51.7% - 900

$

928,126

$

708,201

Non-GAAP Gross Margin

52.9%

52.8%

50.5%

52.1% 51.7%

Effective Tax Rate Reconciliation GAAP Tax Expense

$

GAAP Effective Tax Rate Adjustments to income taxes Non-GAAP Tax Expense Non-GAAP Effective Tax Rate

• 11,528 $ 10.7% 6,778

• 16,373 $ 11.4% 7,903

• 2,639 $ 9.5% 3,251

42,308 $ 27,902

11.5% 11.4%

23,675 11,423

$

18,306 13.5%

$

24,276 13.9%

$

5,890 12.9%

$

65,983

$

39,325

13.9% 12.5%

Tax Impact to EPS Reconciliation GAAP Tax Expense Adjustments to income taxes Non-GAAP Tax Expense

$

• 0.20 $ 0.11

• 0.28 $ 0.13

• 0.04 $ 0.05

0.72 $ 0.46

0.40 0.19

$

0.31

$

0.41

$

0.09

$

1.12

$

0.65