Intersil Corporation Reports First Quarter Results

(PRNewswire) —   Intersil Corporation (NASDAQ: ISIL), a leading provider of innovative power management and precision analog solutions, today announced financial results for the first quarter ended April 1, 2016. First quarter revenue of $129.3 million was up 2.1% sequentially. Gross margin also increased sequentially, operating expenses remained in line with expectations, and the company sustained strong operating income levels.

Company Highlights

  • Consumer and Computing (C&C) revenue was better than seasonal, increasing year-over-year by over 8%.
  • Infrastructure and Industrial (I&I) demand improved broadly, resulting in 4% sequential growth.
  • Gross margin increased sequentially by 120 and 130 basis points, respectively, to 58.8% on a GAAP basis and 59.1% on a non-GAAP basis.
  • The company again reported solid profitability, with non-GAAP operating margin of 20% or greater for the 11th consecutive quarter.
  • Cash and cash equivalents increased to $254 million at quarter-end.

Quarterly Results
Revenue for the first quarter was better than seasonal due to ramps of new business in C&C, record revenue in automotive, and recovery in infrastructure and industrial markets. I&I revenue increased 4% sequentially, with automotive, power and analog growing in the quarter. Automotive revenue reached another record as strong end-market demand and new business propelled the business forward. First quarter C&C revenue decreased only 1% sequentially and was up over 8% year over year. The company's new products shipping into high profile mobile platforms were behind the better than seasonal result. The breakdown by end market follows:


Q1 2016


Q4 2015


Q1 2015

End Market Revenue

$M


%


$M


%


$M


%

Infrastructure & Industrial

82.2


64%


79.1


62%


90.7


68%

Consumer & Computing 

47.1


36%


47.5


38%


43.5


32%

Total Revenue

$129.3




$126.6




$134.2



 

Table 1. Intersil End Market Mix

GAAP gross margin for the quarter increased to 58.8%. First quarter GAAP operating expenses increased to $60.8 million as a result of increasing R&D investment. R&D expense was $33.7 million and SG&A expense was $23.6 million. First quarter GAAP operating income was $15.2 million or 11.8% of revenue. GAAP net income was $11.8 million, and fully diluted GAAP earnings per share were $0.09.

The following non-GAAP results exclude amortization of purchased intangibles, equity-based compensation expense, certain legal judgments and governmental penalties, acquisition-related charges, and gain on recovery of auction rate securities, as well as the related tax effects. First quarter non-GAAP gross margin increased by 130 basis points to 59.1%. Non-GAAP R&D investment increased to $30.6 million while non-GAAP SG&A decreased to $20.0 million, resulting in total non-GAAP operating expense of $50.6 million for the quarter. Q1 non-GAAP operating income increased to $25.8 million, resulting in non-GAAP operating margin of 20.0%. Fully diluted Q1 earnings per share on a non-GAAP basis were $0.15.

For a complete reconciliation of GAAP and non-GAAP results, please see the "Non-GAAP Results" tables included at the end of this release.

Cash and cash equivalents increased again to $254 million at the end of the first quarter. Intersil's board of directors authorized payment of a quarterly dividend of $0.12 per share of common stock. The payment of this dividend will be made on or about May 27, 2016 to shareholders of record as of the close of business on May 17, 2016 .

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