Quarterly revenues increased 18 percent year-over-year to $105.2 million; GAAP earnings were $0.16 per diluted share; non-GAAP earnings were $0.30 per diluted share

Power Integrations (NASDAQ: POWI) today announced financial results for the quarter and year ended December 31, 2024. Net revenues for the fourth quarter were $105.2 million, down nine percent from the prior quarter and up 18 percent from the fourth quarter of 2023. GAAP net income for the fourth quarter was $9.1 million or $0.16 per diluted share compared to $0.25 per diluted share in the prior quarter and $0.25 per diluted share in the fourth quarter of 2023. Cash flow from operations for the fourth quarter was $14.7 million.

In addition to its GAAP results, the company provided non-GAAP measures that exclude stock-based compensation, amortization of acquisition-related intangible assets and the related tax effects. Non-GAAP net income for the fourth quarter of 2024 was $17.2 million or $0.30 per diluted share compared to $0.40 per diluted share in the prior quarter and $0.22 per diluted share in the fourth quarter of 2023. A reconciliation of GAAP to non-GAAP financial results is included with the tables accompanying this press release.

For the full year, net revenues were $419.0 million, compared to $444.5 million in the prior year. Full-year GAAP net income was $32.2 million or $0.56 per diluted share, compared to $0.97 per diluted share in the prior year. Non-GAAP net income was $1.16 per diluted share, compared to $1.29 per diluted share in the prior year. Cash flow from operations for the full year was $81.2 million.

Commented Balu Balakrishnan, chairman and CEO of Power Integrations: "Fourth-quarter revenues were up 18 percent year-over-year, and we expect another double-digit increase in the first quarter. While the demand outlook is cloudy, especially in light of uncertainty around trade policy, we expect growth in a variety of end-markets in 2025, including renewable energy, high-voltage DC transmission, metering, automotive, appliances and more. Products featuring our proprietary PowiGaN™ technology should contribute significant growth this year as adoption accelerates across a broad set of high-voltage power-conversion applications."

Additional Highlights

Power Integrations paid a dividend of $0.21 per share on December 31, 2024. A dividend of $0.21 per share will be paid on March 31, 2025, to stockholders of record as of February 28, 2025.
The company utilized $1.9 million for share repurchases during the fourth quarter, leaving $48.1 million remaining on its repurchase authorization as of December 31.

Financial Outlook

The company issued the following forecast for the first quarter of 2025:

Revenues are expected to be flat compared to the fourth quarter of 2024, plus or minus five percent.
GAAP gross margin is expected to be between 55 percent and 55.5 percent, and non-GAAP gross margin is expected to be between 55.5 percent and 56 percent. The difference between GAAP and non-GAAP is primarily attributable to stock-based compensation, with a smaller impact from amortization of acquisition-related intangible assets.
GAAP operating expenses are expected to be approximately $54 million; non-GAAP operating expenses are expected to be approximately $45 million. Non-GAAP operating expenses are expected to exclude approximately $9 million of stock-based compensation.

Conference Call Today at 1:30 p.m. Pacific Time

Power Integrations management will hold a conference call today at 1:30 p.m. Pacific time. A live webcast of the call will be available on the investor section of the company's website, http://investors.power.com. Members of the investment community can register for the conference call by visiting https://emportal.ink/3C0h3y6.

About Power Integrations

Power Integrations, Inc. is a leading innovator in semiconductor technologies for high-voltage power conversion. The company's products are key building blocks in the clean-power ecosystem, enabling the generation of renewable energy as well as the efficient transmission and consumption of power in applications ranging from milliwatts to megawatts. For more information, please visit www.power.com.

Note Regarding Use of Non-GAAP Financial Measures

In addition to the company's consolidated financial statements, which are presented according to GAAP, the company provides certain non-GAAP financial information that excludes stock-based compensation expenses recorded under ASC 718-10, amortization of acquisition-related intangible assets and the tax effects of these items. The company uses these measures in its financial and operational decision-making and, with respect to one measure, in setting performance targets for compensation purposes. The company believes that these non-GAAP measures offer important analytical tools to help investors understand its operating results, and to facilitate comparability with the results of companies that provide similar measures. Non-GAAP measures have limitations as analytical tools and are not meant to be considered in isolation or as a substitute for GAAP financial information. For example, stock-based compensation is an important component of the company's compensation mix and will continue to result in significant expenses in the company's GAAP results for the foreseeable future but is not reflected in the non-GAAP measures. Also, other companies, including companies in Power Integrations' industry, may calculate non-GAAP measures differently, limiting their usefulness as comparative measures. Reconciliations of non-GAAP measures to GAAP measures are attached to this press release.

Note Regarding Forward-Looking Statements

The above statements regarding the company's forecast for its first-quarter financial performance and expectation of growth across a wide range of end-markets in 2025 are forward-looking statements reflecting management's current expectations and beliefs. These statements are based on current information that is, by its nature, subject to rapid and even abrupt change. Due to risks and uncertainties associated with the company's business, actual results could differ materially from those projected or implied by these statements. These risks and uncertainties include, but are not limited to: the company's ability to supply products and its ability to conduct other aspects of its business such as competing for new design wins; changes in global economic and geopolitical conditions, including such factors as inflation, armed conflicts and trade negotiations, which may impact the level of demand for the company's products; potential changes and shifts in customer demand away from end products that utilize the company's integrated circuits to end products that do not incorporate the company's products; the effects of competition, which may cause the company's revenues to decrease or cause the company to decrease its selling prices for its products; unforeseen costs and expenses; and unfavorable fluctuations in component costs or operating expenses resulting from changes in commodity prices and/or exchange rates. In addition, new product introductions and design wins are subject to the risks and uncertainties that typically accompany development and delivery of complex technologies to the marketplace, including product development delays and defects and market acceptance of the new products. These and other risk factors that may cause actual results to differ are more fully explained under the caption "Risk Factors" in the company's most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 12, 2024. The company is under no obligation (and expressly disclaims any obligation) to update or alter its forward-looking statements, whether because of new information, future events or otherwise, except as otherwise required by law.

Power Integrations, PowiGaN and the Power Integrations logo are trademarks or registered trademarks of Power Integrations, Inc. All other trademarks are property of their respective owners.

POWER INTEGRATIONS, INC.
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per-share amounts)


	Three Months Ended									Twelve Months Ended
	December 31, 2024			September 30, 2024			December 31, 2023			December 31, 2024			December 31, 2023
NET REVENUES	$	105,250		$	115,837		$	89,507		$	418,973		$	444,538

COST OF REVENUES		47,983			52,666			43,299			194,222			215,582

GROSS PROFIT		57,267			63,171			46,208			224,751			228,956

OPERATING EXPENSES:
Research and development		25,689			25,829			23,505			100,790			96,067
Sales and marketing		16,931			17,119			15,472			67,825			64,598
General and administrative		10,728			8,641			8,282			38,207			33,232
Total operating expenses		53,348			51,589			47,259			206,822			193,897

INCOME (LOSS) FROM OPERATIONS		3,919			11,582			(1,051	)		17,929			35,059

OTHER INCOME		3,384			2,750			3,282			12,825			10,848

INCOME BEFORE INCOME TAXES		7,303			14,332			2,231			30,754			45,907

PROVISION (BENEFIT) FOR INCOME TAXES		(1,837	)		41			(12,040	)		(1,480	)		(9,828	)

NET INCOME	$	9,140		$	14,291		$	14,271		$	32,234		$	55,735

EARNINGS PER SHARE:
Basic	$	0.16		$	0.25		$	0.25		$	0.57		$	0.97
Diluted	$	0.16		$	0.25		$	0.25		$	0.56		$	0.97

SHARES USED IN PER-SHARE CALCULATION:
Basic		56,848			56,817			56,937			56,820			57,195
Diluted		57,097			57,004			57,272			57,130			57,622



SUPPLEMENTAL INFORMATION:	Three Months Ended									Twelve Months Ended
	December 31, 2024			September 30, 2024			December 31, 2023			December 31, 2024			December 31, 2023
Stock-based compensation expenses included in:
Cost of revenues	$	541		$	496		$	499		$	2,090		$	1,692
Research and development		3,280			2,997			2,947			12,587			10,939
Sales and marketing		2,074			1,876			1,827			8,064			6,888
General and administrative		3,394			2,969			2,230			12,335			9,009
Total stock-based compensation expense	$	9,289		$	8,338		$	7,503		$	35,076		$	28,528

Cost of revenues includes:
Amortization of acquisition-related intangible assets	$	147		$	147		$	482		$	1,034		$	1,928


	Three Months Ended									Twelve Months Ended
REVENUE MIX BY END MARKET	December 31, 2024			September 30, 2024			December 31, 2023			December 31, 2024			December 31, 2023
Communications		13	%		12	%		27	%		12	%		29	%
Computer		15	%		14	%		9	%		14	%		12	%
Consumer		37	%		38	%		29	%		39	%		27	%
Industrial		35	%		36	%		35	%		35	%		32	%

POWER INTEGRATIONS, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP RESULTS
(in thousands, except per-share amounts)

	Three Months Ended									Twelve Months Ended
	December 31, 2024			September 30, 2024			December 31, 2023			December 31, 2024			December 31, 2023
RECONCILIATION OF GROSS PROFIT
GAAP gross profit	$	57,267		$	63,171		$	46,208		$	224,751		$	228,956
GAAP gross margin		54.4	%		54.5	%		51.6	%		53.6	%		51.5	%

Stock-based compensation included in cost of revenues		541			496			499			2,090			1,692
Amortization of acquisition-related intangible assets		147			147			482			1,034			1,928

Non-GAAP gross profit	$	57,955		$	63,814		$	47,189		$	227,875		$	232,576
Non-GAAP gross margin		55.1	%		55.1	%		52.7	%		54.4	%		52.3	%


	Three Months Ended									Twelve Months Ended
RECONCILIATION OF OPERATING EXPENSES	December 31, 2024			September 30, 2024			December 31, 2023			December 31, 2024			December 31, 2023
GAAP operating expenses	$	53,348		$	51,589		$	47,259		$	206,822		$	193,897

Less:Stock-based compensation expense included in operating expenses
Research and development		3,280			2,997			2,947			12,587			10,939
Sales and marketing		2,074			1,876			1,827			8,064			6,888
General and administrative		3,394			2,969			2,230			12,335			9,009
Total		8,748			7,842			7,004			32,986			26,836

Non-GAAP operating expenses	$	44,600		$	43,747		$	40,255		$	173,836		$	167,061


	Three Months Ended									Twelve Months Ended
RECONCILIATION OF INCOME FROM OPERATIONS	December 31, 2024			September 30, 2024			December 31, 2023			December 31, 2024			December 31, 2023
GAAP income (loss) from operations	$	3,919		$	11,582		$	(1,051	)	$	17,929		$	35,059
GAAP operating margin		3.7	%		10.0	%		-1.2	%		4.3	%		7.9	%

Add:Total stock-based compensation		9,289			8,338			7,503			35,076			28,528
Amortization of acquisition-related intangible assets		147			147			482			1,034			1,928

Non-GAAP income from operations	$	13,355		$	20,067		$	6,934		$	54,039		$	65,515
Non-GAAP operating margin		12.7	%		17.3	%		7.7	%		12.9	%		14.7	%


	Three Months Ended									Twelve Months Ended
RECONCILIATION OF PROVISION FOR INCOME TAXES	December 31, 2024			September 30, 2024			December 31, 2023			December 31, 2024			December 31, 2023
GAAP provision (benefit) for income taxes	$	(1,837	)	$	41		$	(12,040	)	$	(1,480	)	$	(9,828	)
GAAP effective tax rate		-25.2	%		0.3	%		-539.7	%		-4.8	%		-21.4	%

Tax effect of adjustments to GAAP results		(1,366	)		(160	)		(9,556	)		(2,153	)		(11,653	)

Non-GAAP provision (benefit) for income taxes	$	(471	)	$	201		$	(2,484	)	$	673		$	1,825
Non-GAAP effective tax rate		-2.8	%		0.9	%		-24.3	%		1.0	%		2.4	%


	Three Months Ended									Twelve Months Ended
RECONCILIATION OF NET INCOME PER SHARE (DILUTED)	December 31, 2024			September 30, 2024			December 31, 2023			December 31, 2024			December 31, 2023
GAAP net income	$	9,140		$	14,291		$	14,271		$	32,234		$	55,735

Adjustments to GAAP net income
Stock-based compensation		9,289			8,338			7,503			35,076			28,528
Amortization of acquisition-related intangible assets		147			147			482			1,034			1,928
Tax effect of items excluded from non-GAAP results		(1,366	)		(160	)		(9,556	)		(2,153	)		(11,653	)

Non-GAAP net income	$	17,210		$	22,616		$	12,700		$	66,191		$	74,538

Average shares outstanding for calculation
of non-GAAP net income per share (diluted)		57,097			57,004			57,272			57,130			57,622

Non-GAAP net income per share (diluted)	$	0.30		$	0.40		$	0.22		$	1.16		$	1.29

GAAP net income per share (diluted)	$	0.16		$	0.25		$	0.25		$	0.56		$	0.97

POWER INTEGRATIONS, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands)


		December 31, 2024			September 30, 2024		December 31, 2023
ASSETS
	CURRENT ASSETS:
	Cash and cash equivalents	$	50,972		$	58,469	$	63,929
	Short-term marketable securities		249,023			245,282		247,640
	Accounts receivable, net		27,172			16,634		14,674
	Inventories		165,612			167,680		163,164
	Prepaid expenses and other current assets		21,260			19,821		22,193
	Total current assets		514,039			507,886		511,600

	PROPERTY AND EQUIPMENT, net		149,562			153,313		164,213
	INTANGIBLE ASSETS, net		8,075			8,283		4,424
	GOODWILL		95,271			95,271		91,849
	DEFERRED TAX ASSETS		36,485			36,393		28,325
	OTHER ASSETS		25,394			23,845		19,457
	Total assets	$	828,826		$	824,991	$	819,868

LIABILITIES AND STOCKHOLDERS' EQUITY
	CURRENT LIABILITIES:
	Accounts payable	$	29,789		$	27,091	$	26,390
	Accrued payroll and related expenses		13,987			13,337		13,551
	Taxes payable		961			1,063		1,016
	Other accrued liabilities		10,580			9,267		7,910
	Total current liabilities		55,317			50,758		48,867

	LONG-TERM LIABILITIES:
	Income taxes payable		3,871			6,351		6,244
	Other liabilities		19,866			18,669		12,516
	Total liabilities		79,054			75,778		67,627

	STOCKHOLDERS' EQUITY:
	Common stock		22			22		23
	Additional paid-in capital		18,734			11,347		-
	Accumulated other comprehensive income (loss)		(3,023	)		1,008		(1,462	)
	Retained earnings		734,039			736,836		753,680
	Total stockholders' equity		749,772			749,213		752,241
	Total liabilities and stockholders' equity	$	828,826		$	824,991	$	819,868

POWER INTEGRATIONS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)

		Three Months Ended									Twelve Months Ended
		December 31, 2024			September 30, 2024			December 31, 2023			December 31, 2024			December 31, 2023
CASH FLOWS FROM OPERATING ACTIVITIES:
	Net income	$	9,140		$	14,291		$	14,271		$	32,234		$	55,735
	Adjustments to reconcile net income to cash provided by operating activities
	Depreciation		7,743			8,454			8,887			33,303			35,203
	Amortization of intangible assets		208			208			543			1,279			2,173
	Loss on disposal of property and equipment		24			208			14			240			100
	Stock-based compensation expense		9,289			8,338			7,503			35,076			28,528
	Accretion of discount on marketable securities		(385	)		(343	)		(497	)		(1,637	)		(351	)
	Deferred income taxes		336			(5,206	)		705			(8,352	)		(9,247	)
	Increase (decrease) in accounts receivable allowance for credit losses		214			(785	)		-			(245	)		(454	)
	Change in operating assets and liabilities:
	Accounts receivable		(10,752	)		523			13,865			(12,253	)		6,616
	Inventories		2,068			2,204			(12,918	)		(2,448	)		(27,744	)
	Prepaid expenses and other assets		(1,613	)		3,542			(346	)		4,001			(1,183	)
	Accounts payable		1,540			2,031			(2,553	)		3,454			(5,435	)
	Taxes payable and other accrued liabilities		(3,086	)		(546	)		(13,207	)		(3,471	)		(18,182	)
	Net cash provided by operating activities		14,726			32,919			16,267			81,181			65,759

CASH FLOWS FROM INVESTING ACTIVITIES:
	Purchases of property and equipment		(3,045	)		(5,731	)		(6,143	)		(17,286	)		(20,884	)
	Purchases of marketable securities		(8,135	)		(19,751	)		(18,196	)		(105,716	)		(191,211	)
	Proceeds from sales and maturities of marketable securities		2,796			18,414			36,045			106,602			197,942
	Acquisition		-			(9,520	)		-			(9,520	)		-
	Net cash provided by (used in) investing activities		(8,384	)		(16,588	)		11,706			(25,920	)		(14,153	)

CASH FLOWS FROM FINANCING ACTIVITIES:
	Net proceeds from issuance of common stock		-			3,009			-			5,700			6,237
	Repurchase of common stock		(1,902	)		-			(47,444	)		(27,881	)		(55,278	)
	Payments of dividends to stockholders		(11,937	)		(11,364	)		(11,343	)		(46,037	)		(44,008	)
	Net cash used in financing activities		(13,839	)		(8,355	)		(58,787	)		(68,218	)		(93,049	)

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS			(7,497	)		7,976			(30,814	)		(12,957	)		(41,443	)

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD			58,469			50,493			94,743			63,929			105,372

CASH AND CASH EQUIVALENTS AT END OF PERIOD		$	50,972		$	58,469		$	63,929		$	50,972		$	63,929

View source version on businesswire.com: https://www.businesswire.com/news/home/20250206282925/en/

Joe Shiffler

Power Integrations, Inc.

(408) 414-8528

joe@power.com

Power Integrations Reports Fourth-Quarter and Full-Year Financial Results