Cirrus Logic Inc ( CRUS Quick Quote CRUS - Free Report) reported adjusted fourth-quarter fiscal 2023 earnings of 92 cents per share, beating the Zacks Consensus Estimate by 10.8%. However, the bottom line decreased 54.2% from the prior-year quarter’s $2.01 per share.
Total revenues of $372.8 million surpassed the Zacks Consensus Estimate by 1% but decreased 24% year over year. The downtick was primarily due to lower general market sales and reduced smartphone sales because a lower-priced smartphone was introduced in the previous quarter. Also, prolonged weakness in the China smartphone market affected the sales of general market battery and power products.
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.
CRUS’ High-Performance Mixed-Signal segment includes a few of its non-audio products. It contributed 38% to total revenues in the fiscal fourth quarter and declined 13.8% year over year to $140.4 million.
The Audio segment’s sales decreased 29% to $232.4 million and contributed 62% to the total revenues.
Non-GAAP gross margin was 50.1%, which contracted 280 basis points (bps) year over year.
Cirrus Logic’s non-GAAP operating expenses decreased 2.2% year over year to $119.8 million.
Non-GAAP operating income of $66.9 million decreased 50.8% year over year. Moreover, the non-GAAP operating profit margin contracted 980 bps to 17.9% from the year-ago quarter.
Balance Sheet and Cash Flow
The company exited the fiscal fourth quarter with cash and marketable securities of $445.8 million compared with $434.5 million as of Dec 24, 2022.
As of Mar 25, 2023, accounts receivable were $150.5 million compared with $270.5 million as of Dec 24, 2022.
In the fiscal fourth quarter, CRUS reported $48.3 million as net cash provided from operations compared with $258.2 million in the prior-year quarter. Free cash flow was $36.6 million in the quarter under review.
The company repurchased 337,522 shares worth $35 million in the quarter under review. As of Mar 25, 2023, the company had $501.1 million worth of shares remaining under its existing share repurchase authorization.
For first-quarter fiscal 2024, the company projects revenues between $260 million and $320 million. Combined R&D and SG&A are projected to be between $142 million and $148 million. The gross margin is expected to be in the range of 49-51%.
Zacks Rank & Stocks to Consider
Cirrus Logic currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the broader technology space are
Dropbox ( DBX Quick Quote DBX - Free Report) , Badger Meter ( BMI Quick Quote BMI - Free Report) and Enfusion ( ENFN Quick Quote ENFN - Free Report) , each presently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
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