Synaptics reports Q2 2019 results, announces CFO transition
Synaptics has reported financial results for Q2 2019 and a breakdown of the revenue mix shows mobile products taking 64.5 percent with IoT products at 20.5 percent and PC products at 15 percent.
Net revenue for Q2 2019, which ended December 29, 2018, was down 1 percent from the same quarter a year earlier and up 2 percent from Q1 to $425.5 million. GAAP net income for the quarter was $12.8 million, or $0.36 per diluted share and non-GAAP net income increased $16.2 million a year ago to $54.4 million, or $1.55 per diluted share.
“Synaptics posted very strong second quarter results and a positive first half of fiscal 2019, marking the sixth consecutive quarter of non-GAAP gross margin improvement and another period of accelerated growth in non-GAAP earnings per share, which was up 40% over the prior year despite unfavorable market conditions,” commented Rick Bergman, Synaptics’ president and CEO. “Our increased operating leverage is a result of the smart decisions we have made as we transition to a more diversified company with a broader product line and customer base. While we expect the first half of calendar 2019 to be impacted by weaker demand trends in some of our end-markets, we anticipate a stronger back half of the year as we continue to focus on executing to our Synaptics 3.0 strategy, with growth driven by our strategic investments in our three key product areas, IoT, OLED and automotive.”
Synaptics also announced that Senior VP and CFO Wajid Ali left the company to accept an executive-level position at another publicly-held company. The announcement noted that Ali’s resignation is not due to any disagreement with the company or any matter relating to its operations, accounting or other policies, or practices.
The company has commenced a search for a new Chief Financial Officer and has promoted Kermit Nolan to Corporate VP, Chief Accounting Officer and Interim CFO. Nolan has served in accounting, tax and finance roles since he joined Synaptics nearly 15 years ago, most recently as VP and Corporate Controller.
Commenting on expected Q3 revenue, Nolan said, “Considering our backlog of $255 million entering the March quarter, subsequent bookings, customer forecasts and product sell-in and sell-through timing patterns, and the resulting expected product mix, we anticipate revenue for the third quarter of fiscal 2019 to be in the range of $340 to $380 million. Based on this guidance, we expect the revenue mix from mobile, IoT and PC products to be approximately 62 percent, 20 percent and 18 percent, respectively.”
Cash at December 31, 2018 was $283 million. Cash flow from operations during the second quarter of fiscal 2019 was $59 million, and the company used $38 million to repurchase approximately 988,000 shares of its common stock.
Last month Synaptics introduced a new family of system-on-chip audio sensor products featuring neural network acceleration, a proprietary wake word engine supporting custom wake words, and far-field voice processing.