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Cirrus Logic Inc (CRUS - Free Report) delivered strong second-quarter fiscal 2023 results, with the top and bottom lines surpassing the Zacks Consensus Estimate and increasing year over year.
The company reported adjusted earnings of $1.99 per share, beating the Zacks Consensus Estimate by 37.2%. The bottom line rose 9.3% from the prior-year quarter's earnings of $1.82 per share.
Total revenues of $540.6 million surpassed the Zacks Consensus Estimate by 14.9% and increased 16% year over year. The performance was driven by its high mixed-signal content gains in smartphones along with a higher unit volume.
Segment Details
This Texas-based company rearranged its reportable segments and created a separate category in fourth-quarter fiscal 2021, High-Performance Mixed-Signal and Audio. Cirrus Logic is expanding into other applications such as laptops, gaming, tablets and AR/VR.
Cirrus Logic’s High-Performance Mixed-Signal segment includes a few of its non-audio products. It contributed 38% to total revenues in the fiscal second quarter. Revenues from the same division surged 22.8% year over year to $202.7 million.
Cirrus Logic, Inc. Price, Consensus and EPS Surprise
The Audio segment’s sales increased 12.3% to $337.8 million and contributed 62% to the total revenues.
Margins
Non-GAAP gross margin was 50.2%, which contracted 110 basis points (bps) year over year.
Cirrus Logic’s non-GAAP operating expenses rose 8.2% year over year to $123.9 million.
Non-GAAP operating income of $147.7 million increased 18.5% year over year. Moreover, the non-GAAP operating profit margin increased 50 bps to 27.3% from the year-ago quarter.
Balance Sheet and Cash Flow
The company exited the fiscal second quarter with cash and marketable securities of $427.9 million compared with $379.3 million as of Jun 25.
As of Sep 24, accounts receivables were $304.6 million compared with $206.3 million recorded as of Jun 25.
In the fiscal second quarter, the company reported $36 million as net cash provided from operations compared with $29 million reported in the prior-year quarter.
The company repurchased 582,876 shares worth $50 million in the quarter under review. As of Sep 24, the company had $586.1 million worth of shares remaining under its existing share repurchase authorization. The company also announced an additional share buyback worth $500 million in the fiscal first quarter.
Outlook
For third-quarter of fiscal 2023, the company projects revenues between $520 million and $580 million. Combined R&D and SG&A are projected to be between $153 million and $159 million. The gross margin is expected to be 49-51%.
Zacks Rank & Key Picks
Cirrus Logic currently carries a Zacks Rank #4 (Sell).
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Cirrus Logic (CRUS) Q2 Earnings & Revenues Beat, Rise Y/Y
Cirrus Logic Inc (CRUS - Free Report) delivered strong second-quarter fiscal 2023 results, with the top and bottom lines surpassing the Zacks Consensus Estimate and increasing year over year.
The company reported adjusted earnings of $1.99 per share, beating the Zacks Consensus Estimate by 37.2%. The bottom line rose 9.3% from the prior-year quarter's earnings of $1.82 per share.
Total revenues of $540.6 million surpassed the Zacks Consensus Estimate by 14.9% and increased 16% year over year. The performance was driven by its high mixed-signal content gains in smartphones along with a higher unit volume.
Segment Details
This Texas-based company rearranged its reportable segments and created a separate category in fourth-quarter fiscal 2021, High-Performance Mixed-Signal and Audio. Cirrus Logic is expanding into other applications such as laptops, gaming, tablets and AR/VR.
Cirrus Logic’s High-Performance Mixed-Signal segment includes a few of its non-audio products. It contributed 38% to total revenues in the fiscal second quarter. Revenues from the same division surged 22.8% year over year to $202.7 million.
Cirrus Logic, Inc. Price, Consensus and EPS Surprise
Cirrus Logic, Inc. price-consensus-eps-surprise-chart | Cirrus Logic, Inc. Quote
The Audio segment’s sales increased 12.3% to $337.8 million and contributed 62% to the total revenues.
Margins
Non-GAAP gross margin was 50.2%, which contracted 110 basis points (bps) year over year.
Cirrus Logic’s non-GAAP operating expenses rose 8.2% year over year to $123.9 million.
Non-GAAP operating income of $147.7 million increased 18.5% year over year. Moreover, the non-GAAP operating profit margin increased 50 bps to 27.3% from the year-ago quarter.
Balance Sheet and Cash Flow
The company exited the fiscal second quarter with cash and marketable securities of $427.9 million compared with $379.3 million as of Jun 25.
As of Sep 24, accounts receivables were $304.6 million compared with $206.3 million recorded as of Jun 25.
In the fiscal second quarter, the company reported $36 million as net cash provided from operations compared with $29 million reported in the prior-year quarter.
The company repurchased 582,876 shares worth $50 million in the quarter under review. As of Sep 24, the company had $586.1 million worth of shares remaining under its existing share repurchase authorization. The company also announced an additional share buyback worth $500 million in the fiscal first quarter.
Outlook
For third-quarter of fiscal 2023, the company projects revenues between $520 million and $580 million. Combined R&D and SG&A are projected to be between $153 million and $159 million. The gross margin is expected to be 49-51%.
Zacks Rank & Key Picks
Cirrus Logic currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks from the broader technology space are Pure Storage (PSTG - Free Report) , Blackbaud (BLKB - Free Report) and Cadence Design Systems (CDNS - Free Report) . All stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Pure Storage’s 2022 earnings is pegged at $1.18 per share, up 24.2% in the past 60 days. The long-term earnings growth rate is anticipated to be 35.5%.
Pure Storage’s earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 171.8%. Shares of PSTG have lost 25.5% in the past year.
The Zacks Consensus Estimate for Blackbaud’s 2022 earnings is pegged at $2.55 per share, unchanged in the past 60 days. The long-term earnings growth rate is anticipated to be 3%.
Blackbaud’s earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 8.5%. Shares of BLKB have lost 25.5% in the past year.
The Zacks Consensus Estimate for Cadence’s 2022 earnings is pegged at $4.20 per share, up 2.2% in the past 60 days. The long-term earnings growth rate is anticipated to be 17.7%.
CDNS’ earnings beat the Zacks Consensus Estimate in all of the last four quarters, the average being 10.4%. Shares of CDNS have lost 12.8% in the past year.