Revenues Grew 14% Sequentially and 15% YoY to $87.9 Million at POWI

Power Integrations, Inc. (POWI) today announced net revenues for the quarter ended June 30, 2013, were $87.9 million, up 14 percent from the prior quarter and 15 percent compared with the second quarter of 2012. GAAP net income for the quarter was $13.7 million or $0.45 per diluted share, compared with $0.37 per diluted share in the prior quarter and a net loss of $0.25 per share in the second quarter of 2012. GAAP gross margin for the second quarter was 52.6 percent; operating margin was 15.1 percent.

In addition to its GAAP results, the company provided non-GAAP financial measures that exclude stock-based compensation expenses, certain expenses, gains and charges related to acquisitions and strategic investments, non-cash interest income, the tax effects of these items, and a one-time tax-related charge incurred in the second quarter of 2012. Non-GAAP net income for the second quarter was $18.5 million or $0.61 per diluted share, compared with $0.47 per diluted share in the prior quarter and $0.49 per diluted share in the second quarter of 2012. Non-GAAP gross margin for the second quarter was 53.6 percent; non-GAAP operating margin was 22.0 percent.

Commented Balu Balakrishnan, president and CEO of Power Integrations: “Quarterly revenues exceeded our expectations, increasing 14 percent sequentially with growth in all four of our primary end markets. Growth was particularly robust in the industrial market, which is now our largest end market in terms of sales. Strong revenue growth and a higher gross margin enabled our non-GAAP operating margin to expand by more than three percentage points versus the prior quarter, contributing to sequential growth of 30 percent in non-GAAP earnings per share.”

Power Integrations generated $24.6 million of cash flow from operations in the quarter; cash and investments increased by $26.0 million from the end of the prior quarter to a total of $145.1 million. The company paid a dividend of $0.08 per share on June 28, 2013. The next dividend of $0.08 per share is to be paid on September 30, 2013 to stockholders of record as of August 30.

The company issued the following forecast for the third quarter of 2013: Third-quarter revenues are expected to be between $89 million and $94 million. Non-GAAP gross margin is expected to be approximately 54 percent. (Excludes from cost of revenues approximately $0.6 million of amortization of acquisition-related intangible assets and $0.3 million of stock-based compensation.) GAAP gross margin is expected to be approximately 53 percent. Non-GAAP operating expenses are expected to be approximately $28 million, plus or minus $0.5 million. (Excludes from GAAP operating expenses approximately $4 million of stock-based compensation expenses and $1 million of amortization expense for acquisition-related intangible assets.) GAAP operating expenses are expected to be $33 million, plus or minus $0.5 million.