Revenues increased 15 percent year-over-year to $105.5 million; GAAP earnings were $0.15 per diluted share; non-GAAP earnings were $0.31 per diluted share

New $50M share-repurchase authorization follows completion of prior $50M buyback

SAN JOSE, Calif., May 12, 2025--(BUSINESS WIRE)--Power Integrations (NASDAQ: POWI) today announced financial results for the quarter ended March 31, 2025. Net revenues for the first quarter were $105.5 million, up slightly compared to the prior quarter and up 15 percent from the first quarter of 2024. GAAP net income for the first quarter was $8.8 million or $0.15 per diluted share compared to $0.16 per diluted share in the prior quarter and $0.07 per diluted share in the first quarter of 2024. Cash flow from operations for the quarter was $26.4 million.

In addition to its GAAP results, the company provided non-GAAP measures that exclude stock-based compensation, amortization of acquisition-related intangible assets and the related tax effects. Non-GAAP net income for the first quarter of 2025 was $17.9 million or $0.31 per diluted share compared to $0.30 per diluted share in the prior quarter and $0.18 per diluted share in the first quarter of 2024. A reconciliation of GAAP to non-GAAP financial results is included with the tables accompanying this press release.

Commented Balu Balakrishnan, chairman and CEO of Power Integrations: "While trade policy adds uncertainty to the second-half outlook, order trends have remained steady, channel inventories are at normal levels, and we expect healthy sequential growth in the second quarter. We are utilizing our strong balance sheet to buy back shares amidst market volatility, while remaining focused on big-picture trends driving demand for innovative high-voltage semiconductor technologies, such as energy efficiency, AI, electrification, and a cleaner, more modern power grid."

Additional Highlights

Power Integrations repurchased 404 thousand shares of its common stock during the quarter for $23.1 million, leaving $25.0 million on its repurchase authorization as of March 31. The company repurchased an additional 560 thousand shares in April, utilizing the remaining $25 million. The company’s board of directors has authorized an additional $50 million for share repurchases. Power Integrations paid a dividend of $0.21 per share on March 31, 2025. A dividend of $0.21 per share will be paid on June 30, 2025, to stockholders of record as of May 30, 2025.

Financial Outlook

The company issued the following forecast for the second quarter of 2025:

Story Continues

Revenues are expected to be $115 million, plus or minus $5 million. GAAP gross margin is expected to be approximately 55 percent, and non-GAAP gross margin is expected to be approximately 55.5 percent. The difference between GAAP and non-GAAP is primarily attributable to stock-based compensation, with a smaller impact from amortization of acquisition-related intangible assets. GAAP operating expenses are expected to be approximately $56 million; non-GAAP operating expenses are expected to be approximately $46 million. Non-GAAP operating expenses are expected to exclude approximately $10 million of stock-based compensation.

Conference Call Today at 1:30 p.m. Pacific Time

Power Integrations management will hold a conference call today at 1:30 p.m. Pacific time. A live webcast of the call will be available on the investor section of the company's website, http://investors.power.com. Members of the investment community can register for the conference call by visiting https://emportal.ink/4iWIEQW.

About Power Integrations

Power Integrations, Inc. is a leading innovator in semiconductor technologies for high-voltage power conversion. The company’s products are key building blocks in the clean-power ecosystem, enabling the generation of renewable energy as well as the efficient transmission and consumption of power in applications ranging from milliwatts to megawatts. For more information, please visit www.power.com.

Note Regarding Use of Non-GAAP Financial Measures

In addition to the company's consolidated financial statements, which are presented according to GAAP, the company provides certain non-GAAP financial information that excludes stock-based compensation expenses recorded under ASC 718-10, amortization of acquisition-related intangible assets and the tax effects of these items. The company uses these measures in its financial and operational decision-making and, with respect to one measure, in setting performance targets for compensation purposes. The company believes that these non-GAAP measures offer important analytical tools to help investors understand its operating results, and to facilitate comparability with the results of companies that provide similar measures. Non-GAAP measures have limitations as analytical tools and are not meant to be considered in isolation or as a substitute for GAAP financial information. For example, stock-based compensation is an important component of the company’s compensation mix and will continue to result in significant expenses in the company’s GAAP results for the foreseeable future but is not reflected in the non-GAAP measures. Also, other companies, including companies in Power Integrations’ industry, may calculate non-GAAP measures differently, limiting their usefulness as comparative measures. Reconciliations of non-GAAP measures to GAAP measures are attached to this press release.

Note Regarding Forward-Looking Statements

The above statements regarding the company’s forecast for its second-quarter financial performance are forward-looking statements reflecting management's current expectations and beliefs. These statements are based on current information that is, by its nature, subject to rapid and even abrupt change. Due to risks and uncertainties associated with the company's business, actual results could differ materially from those projected or implied by these statements. These risks and uncertainties include, but are not limited to: changes in trade policies, in particular the escalation and imposition of new and higher tariffs, which could reduce demand for end products that incorporate our integrated circuits and/or place pressure on our prices as our customers seek to offset the impact of increased tariffs on their own products; the company’s ability to supply products and its ability to conduct other aspects of its business such as competing for new design wins; changes in global economic and geopolitical conditions, including such factors as inflation, armed conflicts and trade negotiations, which may impact the level of demand for the company’s products; potential changes and shifts in customer demand away from end products that utilize the company's integrated circuits to end products that do not incorporate the company's products; the effects of competition, which may cause the company’s revenues to decrease or cause the company to decrease its selling prices for its products; unforeseen costs and expenses; and unfavorable fluctuations in component costs or operating expenses resulting from changes in commodity prices and/or exchange rates. In addition, new product introductions and design wins are subject to the risks and uncertainties that typically accompany development and delivery of complex technologies to the marketplace, including product development delays and defects and market acceptance of the new products. These and other risk factors that may cause actual results to differ are more fully explained under the caption "Risk Factors" in the company's most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 7, 2025. The company is under no obligation (and expressly disclaims any obligation) to update or alter its forward-looking statements, whether because of new information, future events or otherwise, except as otherwise required by law.

Power Integrations and the Power Integrations logo are trademarks or registered trademarks of Power Integrations, Inc. All other trademarks are property of their respective owners.

POWER INTEGRATIONS, INC. CONSOLIDATED STATEMENTS OF INCOME (in thousands, except per-share amounts)   Three Months Ended March 31, 2025  December 31, 2024  March 31, 2024 NET REVENUES  $ 105,529   $ 105,250   $ 91,688   COST OF REVENUES   47,294    47,983    43,908   GROSS PROFIT   58,235    57,267    47,780   OPERATING EXPENSES:  Research and development  24,095    25,689    23,225  Sales and marketing   16,375    16,931    15,722  General and administrative   11,047    10,728    8,363  Total operating expenses  51,517    53,348    47,310   INCOME FROM OPERATIONS  6,718    3,919    470   OTHER INCOME   3,167    3,384    3,502   INCOME BEFORE INCOME TAXES  9,885    7,303    3,972   PROVISION (BENEFIT) FOR INCOME TAXES  1,095    (1,837 )   18   NET INCOME   $ 8,790   $ 9,140   $ 3,954   EARNINGS PER SHARE:  Basic   $ 0.15   $ 0.16   $ 0.07  Diluted   $ 0.15   $ 0.16   $ 0.07   SHARES USED IN PER-SHARE CALCULATION:  Basic    56,871    56,848    56,833  Diluted    57,123    57,097    57,132    SUPPLEMENTAL INFORMATION: Three Months Ended March 31, 2025  December 31, 2024  March 31, 2024 Stock-based compensation expenses included in:  Cost of revenues  $ 657   $ 541   $ 346  Research and development  2,250    3,280    2,425  Sales and marketing   1,586    2,074    1,604  General and administrative  4,190    3,394    2,039  Total stock-based compensation expense $ 8,683   $ 9,289   $ 6,414   Cost of revenues includes:  Amortization of acquisition-related intangible assets $ 147   $ 147   $ 482    Three Months Ended REVENUE MIX BY END MARKET March 31, 2025  December 31, 2024  March 31, 2024 Communications   10 %   13 %   11 % Computer    12 %   15 %   11 % Consumer    44 %   37 %   41 % Industrial    34 %   35 %   37 %

POWER INTEGRATIONS, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP RESULTS (in thousands, except per-share amounts)  Three Months Ended March 31, 2025  December 31, 2024  March 31, 2024 RECONCILIATION OF GROSS PROFIT  GAAP gross profit $ 58,235   $ 57,267   $ 47,780  GAAP gross margin  55.2 %   54.4 %   52.1 %  Stock-based compensation included in cost of revenues  657    541    346  Amortization of acquisition-related intangible assets  147    147    482   Non-GAAP gross profit $ 59,039   $ 57,955   $ 48,608  Non-GAAP gross margin  55.9 %   55.1 %   53.0 %   Three Months Ended RECONCILIATION OF OPERATING EXPENSES March 31, 2025  December 31, 2024  March 31, 2024 GAAP operating expenses $ 51,517   $ 53,348   $ 47,310   Less: Stock-based compensation expense included in operating expenses  Research and development  2,250    3,280    2,425  Sales and marketing  1,586    2,074    1,604  General and administrative  4,190    3,394    2,039  Total    8,026    8,748    6,068   Non-GAAP operating expenses $ 43,491   $ 44,600   $ 41,242    Three Months Ended RECONCILIATION OF INCOME FROM OPERATIONS March 31, 2025  December 31, 2024  March 31, 2024 GAAP income from operations $ 6,718   $ 3,919   $ 470  GAAP operating margin  6.4 %   3.7 %   0.5 %  Add: Total stock-based compensation  8,683    9,289    6,414  Amortization of acquisition-related intangible assets  147    147    482   Non-GAAP income from operations $ 15,548   $ 13,355   $ 7,366  Non-GAAP operating margin  14.7 %   12.7 %   8.0 %   Three Months Ended RECONCILIATION OF PROVISION FOR INCOME TAXES March 31, 2025  December 31, 2024  March 31, 2024 GAAP provision (benefit) for income taxes $ 1,095   $ (1,837 )  $ 18  GAAP effective tax rate  11.1 %   -25.2 %   0.5 %  Tax effect of adjustments to GAAP results  239    (1,366 )   (358 )  Non-GAAP provision (benefit) for income taxes $ 856   $ (471 )  $ 376  Non-GAAP effective tax rate  4.6 %   -2.8 %   3.5 %   Three Months Ended RECONCILIATION OF NET INCOME PER SHARE (DILUTED) March 31, 2025  December 31, 2024  March 31, 2024 GAAP net income $ 8,790   $ 9,140   $ 3,954   Adjustments to GAAP net income  Stock-based compensation  8,683    9,289    6,414  Amortization of acquisition-related intangible assets  147    147    482  Tax effect of items excluded from non-GAAP results  239    (1,366 )   (358 )  Non-GAAP net income $ 17,859   $ 17,210   $ 10,492   Average shares outstanding for calculation of non-GAAP net income per share (diluted)  57,123    57,097    57,132   Non-GAAP net income per share (diluted) $ 0.31   $ 0.30   $ 0.18   GAAP net income per share (diluted) $ 0.15   $ 0.16   $ 0.07

POWER INTEGRATIONS, INC. CONSOLIDATED BALANCE SHEETS (in thousands)   March 31, 2025  December 31, 2024 ASSETS  CURRENT ASSETS:  Cash and cash equivalents  $ 49,614   $ 50,972  Short-term marketable securities   239,682    249,023  Accounts receivable, net   22,806    27,172  Inventories   169,068    165,612  Prepaid expenses and other current assets   18,645    21,260  Total current assets   499,815    514,039   PROPERTY AND EQUIPMENT, net   146,786    149,562  INTANGIBLE ASSETS, net   7,868    8,075  GOODWILL   95,271    95,271  DEFERRED TAX ASSETS   38,906    36,485  OTHER ASSETS   25,754    25,394  Total assets  $ 814,400   $ 828,826   LIABILITIES AND STOCKHOLDERS’ EQUITY  CURRENT LIABILITIES:  Accounts payable  $ 33,587   $ 29,789  Accrued payroll and related expenses   12,526    13,987  Taxes payable   781    961  Other accrued liabilities   8,056    10,580  Total current liabilities   54,950    55,317   LONG-TERM LIABILITIES:  Income taxes payable   3,992    3,871  Other liabilities   19,643    19,866  Total liabilities   78,585    79,054   STOCKHOLDERS' EQUITY:  Common stock   22    22  Additional paid-in capital   7,106    18,734  Accumulated other comprehensive loss   (2,183 )   (3,023 ) Retained earnings   730,870    734,039  Total stockholders' equity   735,815    749,772  Total liabilities and stockholders' equity  $ 814,400   $ 828,826

POWER INTEGRATIONS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands)  Three Months Ended March 31, 2025  December 31, 2024  March 31, 2024 CASH FLOWS FROM OPERATING ACTIVITIES:  Net income $ 8,790   $ 9,140   $ 3,954  Adjustments to reconcile net income to cash provided by operating activities:  Depreciation  7,244    7,743    8,715  Amortization of intangible assets  207    208    543  Loss on disposal of property and equipment  -    24    8  Stock-based compensation expense  8,683    9,289    6,414  Accretion of discount on marketable securities  (346 )   (385 )   (496 ) Deferred income taxes  (2,537 )   336    (1,330 ) Increase (decrease) in accounts receivable allowance for credit losses  (381 )   214    163  Change in operating assets and liabilities:  Accounts receivable  4,747    (10,752 )   2,232  Inventories  (3,456 )   2,068    (4,701 ) Prepaid expenses and other assets  3,369    (1,613 )   846  Accounts payable  4,002    1,540    1,294  Taxes payable and other accrued liabilities  (3,936 )   (3,086 )   (1,737 ) Net cash provided by operating activities  26,386    14,726    15,905   CASH FLOWS FROM INVESTING ACTIVITIES:  Purchases of property and equipment  (5,726 )   (3,045 )   (4,343 ) Purchases of marketable securities  (5,630 )   (8,135 )   (49,912 ) Proceeds from sales and maturities of marketable securities  15,882    2,796    54,198  Net cash provided by (used in) investing activities  4,526    (8,384 )   (57 )  CASH FLOWS FROM FINANCING ACTIVITIES:  Net proceeds from issuance of common stock  2,787    -    2,691  Repurchase of common stock  (23,098 )   (1,902 )   (14,641 ) Payments of dividends to stockholders  (11,959 )   (11,937 )   (11,384 ) Net cash used in financing activities  (32,270 )   (13,839 )   (23,334 )  NET DECREASE IN CASH AND CASH EQUIVALENTS  (1,358 )   (7,497 )   (7,486 )  CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD  50,972    58,469    63,929   CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 49,614   $ 50,972   $ 56,443

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Contacts

Joe Shiffler
Power Integrations, Inc.
(408) 414-8528
[email protected]

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