01—Abstract
Summary
Summary of the 10-K filed February 25, 2022. Cited figures are marked; the original filing is the authoritative source.
Monolithic Power Systems, Inc. (MPWR) reported a strong financial performance in its 2021 10-K filing, showcasing significant revenue growth and improved profitability.
The company experienced a robust 43% increase in revenue to $1.21 billiona, driven by broad-based demand across its key end markets, particularly automotive, computing and storage, and industrial sectors. This growth was supported by a 31% increase in unit shipments and an 8% rise in average selling prices, attributed to a favorable product mix. Profitability also saw a substantial improvement, with gross margin expanding to 56.8% from 55.2% in the prior year, benefiting from higher average selling prices and a one-time litigation settlement.
Operating income grew by 65%b, reflecting strong revenue growth outpacing increases in operating expenses, which themselves were managed effectively as a percentage of revenue. The company ended the year with a solid liquidity position, maintaining substantial cash and short-term investments, and continued its commitment to shareholders through increased dividend payments. MPWR's focus on high-performance, energy-efficient power solutions in growing markets positions it well for continued expansion.
02—Key points
Key Highlights
- Revenue increased by 43.0% to $1.21 billion in 2021, up from $844.5 million in 2020.
- Gross margin improved to 56.8% in 2021, compared to 55.2% in 2020, driven by favorable product mix and average selling price increases.
- Operating income grew significantly by 65% year-over-year, reaching $262.4 million.
- Strong growth was observed across multiple end markets, with Automotive up 87.5%, Computing and Storage up 47.0%, and Industrial up 54.5%.
- R&D expenses increased by 38.5% but decreased as a percentage of revenue to 15.8% from 16.3%.
- SG&A expenses increased by 39.9% but also decreased as a percentage of revenue to 18.7% from 19.1%.
- The company ended the year with $725.1 million in cash, cash equivalents, and short-term investments.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2021, Monolithic Power Systems kept $0.20.
- Revenue$1.21B100.0%
- Cost of revenue−$522.3M43.2%
- Gross profit$685.5M56.8%
- Operating costs−$423.0M35.0%
- Operating income$262.4M21.7%
- Interest, other & tax−$20.4M1.7%
- Net income$242.0M20.0%
Where FY2021 revenue went
$1.21B- Cost of revenue: $522.3M, 43% of revenue
- Net income: $242.0M, 20% of revenue
- SG&A: $232.4M, 19% of revenue
- Other operating costs: $190.6M, 16% of revenue
- Interest, other & tax: $20.4M, 1.7% of revenue
Kept 20% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2021filed February 25, 2022Financial Statements
FY2021 against FY2020
| Line item | FY2021FY2020 | Change |
|---|---|---|
| Revenue | $1.21B$844.45M | +43.0% |
| Cost of Revenue | $522.34M$378.50M | +38.0% |
| Gross Profit | $685.46M$465.95M | +47.1% |
| SG&A Expenses | $232.41M$161.67M | +43.8% |
| Operating Expenses | $423.04M$307.07M | +37.8% |
| Operating Income | $262.42M$158.88M | +65.2% |
| Net Income | $242.02M$164.38M | +47.2% |
| EPS (Basic) | $5.28$3.67 | +43.9% |
| EPS (Diluted) | $5.05$3.50 | +44.3% |
| Shares Outstanding (Basic) | 45.85M44.84M | +2.3% |
| Shares Outstanding (Diluted) | 47.89M47.01M | +1.9% |
05—Questions
Frequently Asked Questions
What was Monolithic Power Systems' (MPWR) revenue performance in 2021?
MPWR reported a 43.0% increase in revenue for the year ended December 31, 2021, reaching $1.208 billion, up from $844.5 million in 2020. This growth was driven by increased unit shipments and a higher average selling price, reflecting strong demand across its key end markets.
How did MPWR's profitability change in 2021?
MPWR's gross profit increased by 47.1% to $685.5 million, resulting in a gross margin of 56.8% for 2021, an improvement from 55.2% in 2020. Operating income saw a substantial increase of 65.3% to $262.4 million, and net income grew by 47.2% to $242.0 million.
Which end markets contributed most significantly to MPWR's revenue growth in 2021?
The automotive market showed the strongest growth, increasing by 87.5%. The computing and storage market grew by 47.0%, and the industrial market increased by 54.5%. These segments, along with communications and consumer markets, all contributed to the overall revenue expansion.
What is the company's liquidity and capital position as of December 31, 2021?
As of December 31, 2021, MPWR had a strong liquidity position with $725.1 million in total cash, cash equivalents, and short-term investments. Working capital was $897.9 million, indicating a healthy financial footing to support ongoing operations and growth initiatives.
What are the key risks highlighted in the filing for MPWR?
Key risks identified include the cyclical nature of the semiconductor industry, significant dependence on Asian markets and operations (particularly China), intense competition, potential supply chain disruptions, reliance on a limited number of customers, and the need for continuous product innovation. Geopolitical factors and international trade policies also pose risks.
06—Continue