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Cirrus Logic (CRUS) Q2 Earnings Top Estimates, Decline Y/Y
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Cirrus Logic Inc (CRUS - Free Report) reported second-quarter fiscal 2024 adjusted earnings per share (EPS) of $1.80, beating the Zacks Consensus Estimate by 16.9%. However, the bottom line decreased 9.6% from the prior-year quarter’s $1.99.
Total revenues of $481.1 million surpassed the Zacks Consensus Estimate by 5.2% but declined 11% year over year. The downtick was primarily due to a reduction in components shipping of smartphones and continued lower general market sales.
Cirrus Logic, Inc. Price, Consensus and EPS Surprise
This Texas-based company rearranged its reportable segments and created separate categories, High-Performance Mixed-Signal and Audio, in the fourth quarter of fiscal 2021. 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. The segment, which contributed 41.2% to total revenues in the fiscal second quarter, fell 2.2% year over year to $198.2 million.
The Audio segment’s sales dipped 16.3% to $282.9 million and contributed 58.8% to total revenues.
We estimated revenues from the High-Performance Mixed-Signal and Audio segments to be $179.4 million and $268.5 million, respectively, for the fiscal second quarter.
Margins
Non-GAAP gross margin was 51.3%, which expanded 110 basis points (bps) year over year.
Cirrus Logic’s non-GAAP operating expenses tumbled 7.7% year over year to $114.8 million.
Non-GAAP operating income of $132.5 million plunged 10.3% year over year. Non-GAAP operating profit margin expanded 20 bps to 27.5% from the year-ago quarter.
Balance Sheet and Cash Flow
The company exited the fiscal second quarter with cash and marketable securities of $312.4 million compared with $388.1 million as of Jun 24, 2023.
As of Sep 23, 2023, accounts receivables were $271.9 million compared with $186 million as of Jun 24, 2023.
In the fiscal second quarter, CRUS reported $22.7 million of net cash used from operations. In the prior-year quarter, it generated $36 million of net cash from operations. Free cash outflow was $31.3 million in the quarter under review.
The company repurchased 510,720 shares worth $40.6 million in the reported quarter. As of Sep 23, 2023, it had $422 million worth of shares remaining under its existing share repurchase authorization.
Outlook
For third-quarter fiscal 2024, management projects revenues to be between $510 million and $570 million. Combined R&D and SG&A are anticipated in the range of $145-$151 million. Gross margin is expected in the 49-51% band.
Zacks Rank
Cirrus Logic currently carries a Zacks Rank #4 (Sell).
The Zacks Consensus Estimate for Asure Software’s 2023 EPS has increased 5.9% in the past 60 days to 54 cents.
Asure Software’s earnings beat the Zacks Consensus Estimate in each of the last four quarters, the average surprise being 676.4%. Shares of ASUR have climbed 26.6% in the past year.
The Zacks Consensus Estimate for Synopsys’ fiscal 2023 EPS has remained flat in the past 60 days at $11.09. SNPS’ long-term earnings growth rate is 16.7%. Shares of SNPS have surged 73.1% in the past year.
The Zacks Consensus Estimate for VMware’s fiscal 2024 EPS has improved 1% in the past 60 days to $7.23.
VMware’s earnings outpaced the Zacks Consensus Estimate in two of the last four quarters while missing twice. The average earnings surprise is 1.2%. Shares of VMW have jumped 30.7% in the past year.
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Cirrus Logic (CRUS) Q2 Earnings Top Estimates, Decline Y/Y
Cirrus Logic Inc (CRUS - Free Report) reported second-quarter fiscal 2024 adjusted earnings per share (EPS) of $1.80, beating the Zacks Consensus Estimate by 16.9%. However, the bottom line decreased 9.6% from the prior-year quarter’s $1.99.
Total revenues of $481.1 million surpassed the Zacks Consensus Estimate by 5.2% but declined 11% year over year. The downtick was primarily due to a reduction in components shipping of smartphones and continued lower general market sales.
Cirrus Logic, Inc. Price, Consensus and EPS Surprise
Cirrus Logic, Inc. price-consensus-eps-surprise-chart | Cirrus Logic, Inc. Quote
Segment Details
This Texas-based company rearranged its reportable segments and created separate categories, High-Performance Mixed-Signal and Audio, in the fourth quarter of fiscal 2021. 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. The segment, which contributed 41.2% to total revenues in the fiscal second quarter, fell 2.2% year over year to $198.2 million.
The Audio segment’s sales dipped 16.3% to $282.9 million and contributed 58.8% to total revenues.
We estimated revenues from the High-Performance Mixed-Signal and Audio segments to be $179.4 million and $268.5 million, respectively, for the fiscal second quarter.
Margins
Non-GAAP gross margin was 51.3%, which expanded 110 basis points (bps) year over year.
Cirrus Logic’s non-GAAP operating expenses tumbled 7.7% year over year to $114.8 million.
Non-GAAP operating income of $132.5 million plunged 10.3% year over year. Non-GAAP operating profit margin expanded 20 bps to 27.5% from the year-ago quarter.
Balance Sheet and Cash Flow
The company exited the fiscal second quarter with cash and marketable securities of $312.4 million compared with $388.1 million as of Jun 24, 2023.
As of Sep 23, 2023, accounts receivables were $271.9 million compared with $186 million as of Jun 24, 2023.
In the fiscal second quarter, CRUS reported $22.7 million of net cash used from operations. In the prior-year quarter, it generated $36 million of net cash from operations. Free cash outflow was $31.3 million in the quarter under review.
The company repurchased 510,720 shares worth $40.6 million in the reported quarter. As of Sep 23, 2023, it had $422 million worth of shares remaining under its existing share repurchase authorization.
Outlook
For third-quarter fiscal 2024, management projects revenues to be between $510 million and $570 million. Combined R&D and SG&A are anticipated in the range of $145-$151 million. Gross margin is expected in the 49-51% band.
Zacks Rank
Cirrus Logic currently carries a Zacks Rank #4 (Sell).
Stocks to Consider
Some better-ranked stocks worth consideration in the broader technology space are Asure Software (ASUR - Free Report) , Synopsys (SNPS - Free Report) and VMware . While Asure Software flaunts a Zacks Rank #1, VMware and Synopsys carry a Zacks Rank #2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Asure Software’s 2023 EPS has increased 5.9% in the past 60 days to 54 cents.
Asure Software’s earnings beat the Zacks Consensus Estimate in each of the last four quarters, the average surprise being 676.4%. Shares of ASUR have climbed 26.6% in the past year.
The Zacks Consensus Estimate for Synopsys’ fiscal 2023 EPS has remained flat in the past 60 days at $11.09. SNPS’ long-term earnings growth rate is 16.7%. Shares of SNPS have surged 73.1% in the past year.
The Zacks Consensus Estimate for VMware’s fiscal 2024 EPS has improved 1% in the past 60 days to $7.23.
VMware’s earnings outpaced the Zacks Consensus Estimate in two of the last four quarters while missing twice. The average earnings surprise is 1.2%. Shares of VMW have jumped 30.7% in the past year.