10-QPeriod: Q2 FY2013

MONOLITHIC POWER SYSTEMS INC Quarterly Report for Q2 Ended Jun 30, 2013

Filed August 6, 2013For Securities:MPWR

Summary

Monolithic Power Systems, Inc. (MPWR) reported its second-quarter and first-half results for 2013. For the three months ended June 30, 2013, revenue was $57.7 million, a slight decrease of 1.5% year-over-year, primarily due to lower sales in both DC to DC converters and lighting control products. Net income for the quarter was $5.5 million, or $0.14 per diluted share, compared to $6.6 million, or $0.18 per diluted share, in the prior year period. The company's gross margin improved slightly to 53.6% from 53.2% in the prior year quarter, indicating some pricing or product mix benefits. For the six months ended June 30, 2013, revenue remained flat at $109.2 million. Net income for the first half was $8.0 million, or $0.21 per diluted share, down from $9.6 million, or $0.27 per diluted share, in the same period of 2012. Operating expenses, particularly SG&A, saw an increase driven by higher stock-based compensation expenses. The company maintains a strong liquidity position with over $189 million in cash, cash equivalents, and short-term investments, and announced a new $100 million stock repurchase program to commence in August 2013.

Financial Highlights

41 data points
Beta

Revenue

$57.71M

53.6% Gross Margin

Net Income

$5.49M

9.5% Net Margin

EPS (Diluted)

$0.14

Total Assets

$332.59M

Cash & Equivalents

$101.73M

Free Cash Flow

$8.15M

Financial Statements
Beta
Revenue$57.71M
Cost of Revenue$26.79M
Gross Profit$30.93M
SG&A Expenses$13.79M
Operating Expenses$26.01M
Operating Income$4.91M
Net Income$5.49M
EPS (Basic)$0.15
EPS (Diluted)$0.14
Shares Outstanding (Basic)37.05M
Shares Outstanding (Diluted)38.24M

Key Highlights

  • 1Revenue for Q2 2013 was $57.7 million, a 1.5% decrease year-over-year, primarily due to lower sales in DC to DC converters and lighting control products.
  • 2Net income for Q2 2013 was $5.5 million ($0.14/diluted share), down from $6.6 million ($0.18/diluted share) in Q2 2012.
  • 3Gross margin improved slightly to 53.6% in Q2 2013 from 53.2% in Q2 2012.
  • 4SG&A expenses increased by 13.4% in Q2 2013 due to higher stock-based compensation expenses.
  • 5The company ended the quarter with $101.7 million in cash and cash equivalents and $87.9 million in short-term investments.
  • 6A new stock repurchase program of up to $100 million over two years was announced, commencing August 9, 2013.
  • 7The company reported a litigation benefit of $0.26 million in Q2 2013, primarily related to settlement payments from Silergy.

Frequently Asked Questions

Revenue for the three months ended June 30, 2013 was $57.7 million, a decrease of 1.5% compared to $58.6 million for the same period in 2012. This decline was attributed to lower sales in both the DC to DC converters and lighting control products segments.

Net income decreased to $5.5 million ($0.14 per diluted share) in Q2 2013 from $6.6 million ($0.18 per diluted share) in Q2 2012. While gross margin improved slightly, an increase in operating expenses, particularly Selling, General, and Administrative (SG&A) expenses due to higher stock-based compensation, impacted net income.

Monolithic Power Systems maintained a strong liquidity position as of June 30, 2013, with $101.7 million in cash and cash equivalents and $87.9 million in short-term investments, totaling over $189 million. This provided ample working capital of $219.3 million.

Yes, the company announced a new stock repurchase program approved by the Board of Directors in the third quarter of 2013. This program authorizes the repurchase of up to $100 million of its common stock over a two-year period, commencing August 9, 2013.