Cirrus Logic, Inc. (NASDAQ:CRUS) Q4 2021 Earnings Conference Call April 29, 2021 5:00 PM ET Company Participants Thurman Case - Chief Financial Officer and Vice President, Finance John Forsyth - President and Chief Executive Officer Chelsea Heffernan - Director, Investor Relations Conference Call Participants Matt Ramsay - Cowen Blayne Curtis - Barclays Tore Svanberg - Stifel Christopher Rolland - SIG Derek Soderberg - Colliers Operator Ladies and gentlemen, thank you for standing by. Welcome to the Cirrus ...

Cirrus Logic, Inc. (NASDAQ:CRUS) Q3 2021 Earnings Conference Call February 1, 2021 5:00 PM ET Company Participants Thurman Case - CFO John Forsyth - CEO Chelsea Heffernan - Director, IR Conference Call Participants Tore Svanberg - Stifel Ruben Roy - Benchmark Company Matt Ramsay - Cowen Blayne Curtis - Barclays Derek Soderberg - Colliers Securities Rajvindra Gill - Needham & Company Vivek Arya - Bank of America Christopher Rolland - SIG Andy Hummel - Oppenheimer Operator Ladies and gentlemen, thank you for ...

PART I - FINANCIAL INFORMATION [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) The company's financial statements for the period ended December 26, 2020, reflect significant growth in total assets to **$1.83 billion**, with third-quarter net sales increasing **30%** year-over-year to **$485.8 million** and net income reaching **$114.4 million**, alongside **$176.4 million** in operating cash flow for the nine-month period [Consolidated Condensed Balance Sheets](index=4&type=section&id=Consolidated%20Condensed%20Balance%20Sheets) As of December 26, 2020, total assets increased to **$1.83 billion** from **$1.59 billion**, driven by growth in cash, receivables, and marketable securities, while total liabilities rose to **$425.3 million** and stockholders' equity grew to **$1.40 billion** Consolidated Condensed Balance Sheet Highlights (in thousands) | Account | December 26, 2020 (unaudited) | March 28, 2020 | | :--- | :--- | :--- | | **Total current assets** | $803,544 | $650,196 | | Accounts receivable, net | $244,803 | $153,998 | | **Total assets** | **$1,825,629** | **$1,592,677** | | **Total current liabilities** | $184,855 | $158,637 | | **Total liabilities** | $425,272 | $362,898 | | **Total stockholders' equity** | **$1,400,357** | **$1,229,779** | [Consolidated Condensed Statements of Income](index=5&type=section&id=Consolidated%20Condensed%20Statements%20of%20Income) For the third quarter ended December 26, 2020, net sales increased **29.7%** year-over-year to **$485.8 million**, with net income reaching **$114.4 million**, while nine-month net sales rose **7.4%** to **$1.08 billion** and net income increased to **$192.1 million** Statement of Income Highlights (in thousands, except per share data) | Metric | Q3 FY2021 (ended Dec 26, 2020) | Q3 FY2020 (ended Dec 28, 2019) | 9 Months FY2021 (ended Dec 26, 2020) | 9 Months FY2020 (ended Dec 28, 2019) | | :--- | :--- | :--- | :--- | :--- | | **Net sales** | $485,795 | $374,668 | $1,075,693 | $1,001,833 | | **Gross profit** | $251,500 | $197,505 | $559,182 | $527,932 | | **Income from operations** | $129,650 | $72,679 | $212,478 | $163,499 | | **Net income** | $114,368 | $68,512 | $192,063 | $149,340 | | **Diluted EPS** | $1.91 | $1.13 | $3.20 | $2.47 | [Consolidated Condensed Statements of Cash Flows](index=7&type=section&id=Consolidated%20Condensed%20Statements%20of%20Cash%20Flows) For the nine months ended December 26, 2020, net cash generated by operating activities decreased to **$176.4 million** from **$246.5 million**, primarily due to working capital changes, with **$69.1 million** used in investing and **$72.1 million** in financing activities, including **$65.0 million** in stock repurchases Cash Flow Summary (Nine Months Ended, in thousands) | Activity | December 26, 2020 | December 28, 2019 | | :--- | :--- | :--- | | Net cash generated by operating activities | $176,442 | $246,547 | | Net cash used in investing activities | ($69,134) | ($50,319) | | Net cash used in financing activities | ($72,133) | ($70,099) | | **Net increase in cash and cash equivalents** | **$35,175** | **$126,129** | [Notes to Consolidated Condensed Financial Statements](index=9&type=section&id=Notes%20to%20Consolidated%20Condensed%20Financial%20Statements) Key notes to the financial statements detail revenue disaggregation, restructuring activities, income tax provisions, and shareholder equity changes, highlighting that **98%** of revenue is from non-U.S. customers, an **11.6%** effective tax rate, and **$65 million** in stock repurchases, with an additional **$350 million** repurchase authorization in January 2021 - Revenue from non-U.S. customers, primarily in Asia, accounted for approximately **98%** of total net sales for the nine months ended December 26, 2020[47](index=47&type=chunk)[48](index=48&type=chunk) - The company's single reportable segment generates revenue from two product lines: Portable Products and Non-Portable and Other Products. Portable Products revenue was **$973.9 million** for the first nine months of FY2021[68](index=68&type=chunk)[69](index=69&type=chunk) - During the nine months ended December 26, 2020, the company repurchased **0.9 million shares** for **$65 million**. As of that date, approximately **$55 million** remained available under the 2019 repurchase program[67](index=67&type=chunk) - In January 2021, the Board of Directors authorized an additional **$350 million** for the company's common stock repurchase program[70](index=70&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=19&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes the **30%** year-over-year Q3 revenue growth to increased smartphone component volumes, noting a slight gross margin decrease to **51.8%** due to product mix, while maintaining strong liquidity with a **$300 million** credit facility, and highlighting **87%** revenue concentration from Apple Inc - Net sales for Q3 FY2021 increased by **30%** YoY to **$485.8 million**, primarily driven by significant growth in unit volumes for components shipping in smartphones[88](index=88&type=chunk) - One end customer, Apple Inc., accounted for approximately **87%** of total net sales for the third quarter of fiscal year 2021, up from **83%** in the prior-year quarter[91](index=91&type=chunk) - Gross margin for Q3 FY2021 was **51.8%**, down from **52.7%** in Q3 FY2020, mainly due to a shift in product mix and typical pricing reductions[93](index=93&type=chunk) - The company believes its existing cash, future cash earnings, and available borrowings under its **$300 million** credit facility will be sufficient to meet capital requirements for at least the next 12 months[106](index=106&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=25&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company faces market risks from interest rates on debt securities and currency fluctuations on non-functional currency assets and liabilities, which it mitigates using foreign currency forward contracts - The company is exposed to market risks from interest rates, currency movements on non-functional currency assets and liabilities, and market factors affecting its marketable securities[110](index=110&type=chunk) - The company uses foreign currency forward contracts to manage exposure to exchange risk on certain non-functional currency balance sheet exposures, with gains and losses recognized currently in earnings[110](index=110&type=chunk) [Controls and Procedures](index=26&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of December 26, 2020, with no material changes to internal control over financial reporting during the quarter - The company's management, including the CEO and CFO, concluded that disclosure controls and procedures were effective as of December 26, 2020[112](index=112&type=chunk) - No changes in internal control over financial reporting occurred during the quarter ended December 26, 2020, that materially affected, or are reasonably likely to materially affect, the company's internal controls[112](index=112&type=chunk) PART II - OTHER INFORMATION [Legal Proceedings](index=26&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal proceedings in the normal course of business, but management does not anticipate any material adverse effects on its financial condition or operations from pending matters - Management does not believe that there are any pending legal matters that could potentially have a material adverse effect on the company's business, financial condition, results of operations, or cash flows[65](index=65&type=chunk) [Risk Factors](index=26&type=section&id=Item%201A.%20Risk%20Factors) The company highlights key risks including the ongoing impact of the COVID-19 pandemic, heavy dependence on a limited number of customers like Apple Inc., reliance on third-party manufacturing facing capacity constraints, challenges in attracting and retaining personnel, risks from the recent CEO transition, and system security risks such as the SolarWinds cyberattack - The COVID-19 pandemic poses risks to business operations, customer demand, and supply chain continuity, potentially heightening other existing risks[115](index=115&type=chunk)[116](index=116&type=chunk) - A single customer, Apple Inc., represented **87%** of net sales in Q3 FY2021, creating significant risk related to customer concentration, pricing pressure, and potential loss of business[119](index=119&type=chunk) - The company relies on third-party manufacturers and is subject to industry-wide capacity constraints, which are currently limiting its ability to fully satisfy demand for some products[124](index=124&type=chunk)[127](index=127&type=chunk) - The company faces risks related to attracting and retaining qualified personnel, particularly technical staff, due to intense competition and potential changes in immigration laws in the U.S. and U.K[129](index=129&type=chunk)[130](index=130&type=chunk) - A successful leadership transition for the new CEO, appointed effective January 1, 2021, is critical to avoid disruption to business and relationships with customers and employees[131](index=131&type=chunk)[132](index=132&type=chunk) - The company faces significant cybersecurity risks, highlighted by the recent SolarWinds cyberattack, which could compromise proprietary data, disrupt operations, and damage its reputation[133](index=133&type=chunk)[134](index=134&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=31&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q3 FY2021, the company repurchased **459,000 shares** of common stock for **$35 million** under its share repurchase program, with **$55 million** remaining available under the January 2019 authorization as of December 26, 2020 Share Repurchase Activity (Q3 FY2021) | Period | Total Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | Oct 25 - Nov 21, 2020 | 386,000 | $76.12 | | Nov 22 - Dec 26, 2020 | 73,000 | $76.78 | | **Total Q3** | **459,000** | **$76.22** | - As of December 26, 2020, approximately **$55 million** remained available for repurchase under the **$200 million** program authorized in January 2019[139](index=139&type=chunk)

Financial Data and Key Metrics Changes - Cirrus Logic reported Q2 FY21 revenue of $347.3 million, significantly above expectations due to stronger-than-anticipated orders for components shipping to smartphones, tablets, and truly wireless headsets [12][56] - The company experienced broad-based demand for components across its portfolio, particularly in the smartphone segment, resulting in revenue exceeding initial forecasts [56] Business Line Data and Key Metrics Changes - The number of smartphones, wearables, and tablets utilizing Cirrus Logic's products increased, with new content featured in several recently launched high-volume products [12] - The company introduced its first specific smart codec designed for truly wireless headsets, marking a new content addition in this product category [16] Market Data and Key Metrics Changes - Cirrus Logic noted an uptick in demand from other smartphone customers, including Xiaomi, which somewhat offsets the headwind from Huawei's challenges [27] - The company is focused on winning sockets in the Android space, particularly around boosted amplifiers, despite the competitive landscape [26] Company Strategy and Development Direction - The new CEO, John Forsyth, emphasized a focus on driving strategic initiatives that support customers, strengthen leadership in audio, and expand into new technology areas [11] - The company aims to leverage outstanding customer relationships, increased product diversification, and continued design innovation to create greater shareholder value [14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's future, highlighting a solid pipeline of products and a commitment to investing in innovative technology [56] - There is caution regarding the impact of COVID-19 and global economic volatility on future performance, with a bullish sentiment on new product launches [37][38] Other Important Information - Jason Rhode will step down as CEO on January 1st, with John Forsyth taking over the role, and David Tupman becoming Chairman of the Board [9][10] - The company will participate in the Barclays Global Technology Media and Telecommunications Conference on December 10th [56] Q&A Session Summary Question: Inquiry about codec for wireless headsets - John Forsyth confirmed that the company is launching its first specific smart codec designed for truly wireless headsets, which incorporates significant improvements [16] Question: Follow-up on next-generation haptics - John Forsyth explained that the new haptic part targets smartphones and may also find use in other areas, with an expected content addition of around $0.70 to $0.75 per unit [19][20] Question: Outlook for closed-loop controller in Android - John Forsyth indicated that while they do not provide detailed guidance, they expect the closed-loop controller to have a significant impact on content value per phone [22][23] Question: Impact of Huawei's challenges on market share - John Forsyth noted that while Huawei represented a small revenue portion, the company is making headway with other smartphone customers, including Xiaomi, to offset challenges [27] Question: Discussion on haptics penetration in end devices - John Forsyth mentioned that haptics is still selectively found in high-end devices, with expectations for broader adoption in the future [31] Question: Insights on gross margin expectations - Jason Rhode stated that gross margin is expected to remain sustainable at around 50%, with potential for a tick-up in margins in FY22 [45] Question: True wireless momentum and future growth catalysts - John Forsyth highlighted that the true wireless market has exceeded expectations, with new product launches introducing smart processing features [47][48] Question: Seasonality in margins for March - John Forsyth expressed caution regarding typical seasonality patterns, indicating that various factors could influence performance [50]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 26, 2020 ☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transition Period from ____ to ____ Commission File Number 0-17795 CIRRUS LOGIC, INC. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or or ...

Cirrus Logic, Inc. (NASDAQ:CRUS) Q1 2021 Earnings Conference Call August 3, 2020 5:00 PM ET Company Participants Thurman Case - Chief Financial Advisor Jason Rhode - Chief Executive Officer John Forsyth - President Chelsea Heffernan - Director, Investor Relations Conference Call Participants Matt Ramsay - Cowen Raji Gill - Needham & Company Tore Svanberg - Stifel Charlie Anderson - Collier Securities Adam Gonzalez - Bank of America Securities Ruben Roy - Benchmark Christopher Rolland - Susquehanna Internati ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 27, 2020 ☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transition Period from ____ to ____ Commission File Number 0-17795 CIRRUS LOGIC, INC. (Exact name of registrant as specified in its charter) Delaware | --- | --- | --- | |-------------------------- ...

PART I [Business](index=4&type=section&id=Item%201.%20Business) Cirrus Logic specializes in low-power, high-precision mixed-signal processing for mobile and consumer applications, with 79% of FY2020 sales from Apple - Cirrus Logic is a **leader** in low-power, high-precision mixed-signal processing solutions for top mobile and consumer applications[7](index=7&type=chunk) - The company's strategy involves developing custom components, leveraging its analog and mixed-signal expertise, and building strong engineering relationships with customers' product teams to secure design wins[8](index=8&type=chunk) Product Line Overview | Product Line | Description | Applications | | :--- | :--- | :--- | | **Portable Products** | Low-power, low-latency, high-precision analog and mixed-signal components | Smartphones, tablets, wearables, digital headsets | | **Non-Portable and Other Products** | High-precision analog and mixed-signal components | Home theater systems, laptops, automotive entertainment systems, industrial and energy applications | - The company has a high customer concentration, with its ten largest end customers accounting for **93%** of sales in fiscal year 2020, and Apple, Inc. alone representing approximately **79%** of total sales in the same period[13](index=13&type=chunk) - As a fabless semiconductor company, Cirrus Logic outsources wafer fabrication, assembly, and testing to third parties, primarily TSMC, GLOBALFOUNDRIES, and ASE, Inc[14](index=14&type=chunk) - As of March 28, 2020, the company held approximately **3,400** pending and issued patents worldwide and employed **1,443** full-time employees[16](index=16&type=chunk)[22](index=22&type=chunk) [Risk Factors](index=8&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks including heavy customer dependence, supply chain disruptions, market fluctuations, and international trade policy changes - The COVID-19 pandemic is expected to have an adverse effect on business, financial condition, and results of operations, potentially disrupting the supply chain, operations, and customer demand[25](index=25&type=chunk) - Dependence on a limited number of customers is a major risk, with the ten largest customers accounting for **93%** of sales in FY2020, and Apple Inc. alone representing **79%**[25](index=25&type=chunk) - The company is exposed to risks from changes in government trade policies, including U.S. tariffs on Chinese imports and export restrictions, which could adversely impact sales and customer relationships, particularly in China[29](index=29&type=chunk)[30](index=30&type=chunk) - Reliance on third-party manufacturing and supply chain relationships poses risks such as insufficient capacity, inadequate yields, potential price increases, and supply disruptions[36](index=36&type=chunk) - The integrated circuit (IC) industry is intensely competitive, characterized by rapid technological change and price erosion, with competition from large international manufacturers and smaller emerging companies[35](index=35&type=chunk) - International sales represented **99%** of net sales in fiscal year 2020, exposing the company to risks associated with political and economic instability, currency fluctuations, and changes in import/export regulations[38](index=38&type=chunk) [Unresolved Staff Comments](index=22&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments from the Securities and Exchange Commission - None[54](index=54&type=chunk) [Properties](index=22&type=section&id=Item%202.%20Properties) Cirrus Logic's principal facilities include owned space in Austin, Texas, and leased space in Edinburgh, Scotland, totaling over 470,000 square feet - The company owns its principal facilities in Austin, Texas, consisting of approximately **155,000** square feet of office space and a **27,000** square foot failure analysis facility[55](index=55&type=chunk) - The company leases approximately **110,000** square feet of office space and **27,000** square feet of lab space in Edinburgh, Scotland, having sold its previously owned headquarters there in fiscal year 2019[55](index=55&type=chunk) [Legal Proceedings](index=22&type=section&id=Item%203.%20Legal%20Proceedings) The company is involved in various legal proceedings, none of which are expected to materially impact its financial condition or operations - Management does not believe there are any pending legal matters that could have a material adverse effect on the company's business, financial condition, results of operations, or cash flows[57](index=57&type=chunk) [Mine Safety Disclosures](index=23&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[58](index=58&type=chunk) PART II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=23&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity,%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on NASDAQ under CRUS; it repurchased 0.7 million shares for $50.0 million in Q4 FY2020, with mixed stock performance against benchmarks Q4 FY2020 Share Repurchases | Period | Total Shares Purchased (thousands) | Average Price Paid Per Share | Approximate Dollar Value Remaining Under Program (thousands) | | :--- | :--- | :--- | :--- | | Dec 29, 2019 - Jan 25, 2020 | — | — | — | | Jan 26, 2020 - Feb 22, 2020 | 255 | $78.43 | $149,981 | | Feb 23, 2020 - Mar 28, 2020 | 428 | $70.06 | $120,001 | | **Total Q4 FY2020** | **683** | **$73.18** | **$120,001** | - The Board of Directors authorized a **$200 million** share repurchase program in January 2019, with approximately **$120.0 million** remaining available as of March 28, 2020[61](index=61&type=chunk) Five-Year Cumulative Total Stockholder Return (Assuming $100 Investment on 3/28/2015) | Company/Index | 3/28/2020 Value | | :--- | :--- | | Cirrus Logic, Inc. | $186.00 | | S&P 500 Index | $136.61 | | S&P 500 Semiconductors Index | $210.86 | [Selected Financial Data](index=25&type=section&id=Item%206.%20Selected%20Financial%20Data) This section summarizes five-year financial data, showing FY2020 net sales of $1.28 billion and net income of $159.5 million, with overall year-over-year growth Selected Financial Data (in thousands, except per share amounts) | Metric | FY 2020 | FY 2019 | FY 2018 | | :--- | :--- | :--- | :--- | | Net sales | $1,281,124 | $1,185,524 | $1,532,186 | | Net income | $159,498 | $89,991 | $161,995 | | Diluted earnings per share | $2.64 | $1.46 | $2.46 | | Total assets | $1,592,677 | $1,352,640 | $1,430,117 | | Total stockholders' equity | $1,229,779 | $1,140,240 | $1,161,728 | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=25&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) FY2020 net sales increased 8.1% to $1.28 billion, gross margin improved to 52.6%, and net income rose to $159.5 million, with strong cash flow and liquidity despite a restructuring charge [Critical Accounting Policies](index=25&type=section&id=Critical%20Accounting%20Policies) Critical accounting policies involve significant judgments in revenue recognition, inventory valuation, asset impairment, legal contingencies, and income tax provisions - Key areas requiring significant management estimates include revenue recognition, inventory write-downs based on forecasted demand, impairment of goodwill and intangible assets, loss contingencies for legal matters, and income tax calculations, including the valuation of deferred tax assets[69](index=69&type=chunk)[70](index=70&type=chunk) [Results of Operations](index=29&type=section&id=Results%20of%20Operations) FY2020 net sales increased 8.1% to $1.28 billion, gross margin improved to 52.6%, and net income reached $159.5 million, despite a $21.9 million restructuring charge Net Sales by Product Line (in thousands) | Product Line | FY 2020 | FY 2019 | FY 2018 | | :--- | :--- | :--- | :--- | | Portable Products | $1,146,918 | $1,032,049 | $1,363,876 | | Non-Portable and Other Products | $134,206 | $153,475 | $168,310 | | **Total** | **$1,281,124** | **$1,185,524** | **$1,532,186** | - Gross margin increased to **52.6%** in FY2020 from **50.4%** in FY2019, primarily due to favorable product mix, cost reductions, and lower reserves[82](index=82&type=chunk) - Research and development expenses decreased by **7%** to **$347.6 million** in FY2020, while Selling, general and administrative expenses increased by **4%** to **$131.1 million**[83](index=83&type=chunk)[84](index=84&type=chunk) - The company recorded a restructuring charge of approximately **$21.9 million** in Q4 FY2020 related to the discontinuation of its MEMS microphone product line[85](index=85&type=chunk) - The effective tax rate for FY2020 was **12.0%**, lower than the U.S. statutory rate of **21.0%**, due to income earned in lower-tax foreign jurisdictions and excess benefits from stock-based compensation[91](index=91&type=chunk) [Liquidity and Capital Resources](index=32&type=section&id=Liquidity%20and%20Capital%20Resources) In FY2020, the company generated $295.8 million in cash from operations, used $120.0 million for share repurchases, and maintained strong liquidity with no outstanding debt Cash Flow Summary (in millions) | Cash Flow Activity | FY 2020 | FY 2019 | FY 2018 | | :--- | :--- | :--- | :--- | | Net cash provided by operating activities | $295.8 | $206.7 | $318.7 | | Net cash used in investing activities | ($100.2) | ($54.7) | ($184.7) | | Net cash used in financing activities | ($119.6) | ($171.5) | ($249.6) | - The company utilized approximately **$120.0 million** in cash to repurchase and retire its common stock in fiscal year 2020[94](index=94&type=chunk) - As of March 28, 2020, the company had no amounts outstanding under its **$300 million** revolving credit facility and was in compliance with all covenants[95](index=95&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=34&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company manages market risks from interest rates and foreign currency fluctuations; a 100 basis point interest rate increase would cause a $5.3 million portfolio decline, while foreign currency impacts are immaterial - A hypothetical **100 basis point** increase in interest rates would cause a **$5.3 million** decline in the fair market value of the company's investment portfolio as of March 28, 2020[100](index=100&type=chunk) - The company uses foreign currency forward contracts to manage exposure to exchange rate fluctuations on non-U.S. dollar balance sheet items, resulting in an immaterial pretax gain or loss from a hypothetical **10%** fluctuation in exchange rates[101](index=101&type=chunk) [Financial Statements and Supplementary Data](index=35&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the audited consolidated financial statements for FY2020, including balance sheets, income statements, and cash flow statements, with detailed notes on accounting policies and key financial figures [Consolidated Balance Sheets](index=40&type=section&id=Consolidated%20Balance%20Sheets) As of March 28, 2020, total assets increased to $1.59 billion, total liabilities to $362.9 million, and total stockholders' equity to $1.23 billion, reflecting growth in cash and lease assets Consolidated Balance Sheet Highlights (in thousands) | Account | March 28, 2020 | March 30, 2019 | | :--- | :--- | :--- | | Cash and cash equivalents | $292,119 | $216,172 | | Total current assets | $650,196 | $624,983 | | Total assets | $1,592,677 | $1,352,640 | | Total current liabilities | $158,637 | $115,540 | | Total liabilities | $362,898 | $212,400 | | Total stockholders' equity | $1,229,779 | $1,140,240 | [Consolidated Statements of Income](index=42&type=section&id=Consolidated%20Statements%20of%20Income) For FY2020, net sales were $1.28 billion, gross profit $674.2 million, income from operations $173.5 million (including a $21.9 million restructuring charge), and net income $159.5 million Consolidated Statement of Income Highlights (in thousands, except per share data) | Metric | FY 2020 | FY 2019 | FY 2018 | | :--- | :--- | :--- | :--- | | Net sales | $1,281,124 | $1,185,524 | $1,532,186 | | Gross profit | $674,167 | $597,497 | $760,716 | | Income from operations | $173,480 | $100,769 | $262,461 | | Net income | $159,498 | $89,991 | $161,995 | | Diluted earnings per share | $2.64 | $1.46 | $2.46 | [Consolidated Statements of Cash Flows](index=44&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) In FY2020, net cash from operations was $295.8 million, net cash used in investing was $100.2 million, and net cash used in financing was $119.6 million, ending with $292.1 million in cash Consolidated Statement of Cash Flows Highlights (in thousands) | Cash Flow Activity | FY 2020 | FY 2019 | FY 2018 | | :--- | :--- | :--- | :--- | | Net cash provided by operating activities | $295,815 | $206,694 | $318,711 | | Net cash used in investing activities | ($100,221) | ($54,662) | ($184,716) | | Net cash used in financing activities | ($119,647) | ($171,464) | ($249,557) | | Net increase (decrease) in cash | $75,947 | ($19,432) | ($115,562) | | Cash and cash equivalents at end of period | $292,119 | $216,172 | $235,604 | [Notes to Consolidated Financial Statements](index=46&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Notes detail revenue recognition, 79% FY2020 revenue from Apple Inc, a $21.9 million restructuring charge, share repurchase programs, and income tax provisions - The company's single performance obligation for revenue recognition is the delivery of promised goods to the customer, satisfied upon transfer of control[149](index=149&type=chunk) - A single end customer, Apple Inc., represented approximately **79%**, **78%**, and **81%** of total sales for fiscal years 2020, 2019, and 2018, respectively[148](index=148&type=chunk) - In Q4 FY2020, the company approved a restructuring plan to discontinue its MEMS microphone product line, resulting in a total charge of **$21.9 million**, which included equipment disposal costs and intangible asset impairments[185](index=185&type=chunk)[186](index=186&type=chunk) - Under its January 2019 share repurchase program, the company has repurchased **1.2 million** shares for **$80.0 million**, with approximately **$120.0 million** remaining available for repurchase as of March 28, 2020[210](index=210&type=chunk) - The company's effective tax rate for FY2020 was **12.0%**, and as of March 28, 2020, it had gross unrecognized tax benefits of **$36.2 million**[216](index=216&type=chunk)[220](index=220&type=chunk) [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=72&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with its accountants on accounting and financial disclosure - None[228](index=228&type=chunk) [Controls and Procedures](index=72&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and internal control over financial reporting were effective as of March 28, 2020, with no material changes in Q4 FY2020 - Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of March 28, 2020[229](index=229&type=chunk) - Management concluded that the company's internal control over financial reporting was effective as of March 28, 2020[229](index=229&type=chunk) PART III [Directors, Executive Officers and Corporate Governance](index=73&type=section&id=Item%2010.%20Directors,%20Executive%20Officers%20and%20Corporate%20Governance) Information on directors, executive officers, and corporate governance is incorporated by reference from the company's July 31, 2020 proxy statement - Information is incorporated by reference from the registrant's proxy statement for the annual meeting of stockholders to be held July 31, 2020[231](index=231&type=chunk) [Executive Compensation](index=73&type=section&id=Item%2011.%20Executive%20Compensation) Information on executive compensation is incorporated by reference from the company's July 31, 2020 proxy statement - Information is incorporated by reference from the registrant's proxy statement for the annual meeting of stockholders to be held July 31, 2020[232](index=232&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=73&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Information on security ownership and related stockholder matters is incorporated by reference from the company's July 31, 2020 proxy statement - Information is incorporated by reference from the registrant's proxy statement for the annual meeting of stockholders to be held July 31, 2020[233](index=233&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=73&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions,%20and%20Director%20Independence) Information on certain relationships, related transactions, and director independence is incorporated by reference from the company's July 31, 2020 proxy statement - Information is incorporated by reference from the registrant's proxy statement for the annual meeting of stockholders to be held July 31, 2020[233](index=233&type=chunk) [Principal Accountant Fees and Services](index=73&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) Information on principal accountant fees and services is incorporated by reference from the company's July 31, 2020 proxy statement - Information is incorporated by reference from the registrant's proxy statement for the annual meeting of stockholders to be held July 31, 2020[234](index=234&type=chunk) PART IV [Exhibits and Financial Statement Schedules](index=73&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists the consolidated financial statements and exhibits filed as part of the Form 10-K, noting the omission of financial statement schedules as information is included elsewhere - This section lists the consolidated financial statements and exhibits filed as part of the Form 10-K[235](index=235&type=chunk)[237](index=237&type=chunk) - All financial statement schedules have been omitted because the required information is not present, not in sufficient amounts, or is included in the consolidated financial statements or notes[236](index=236&type=chunk)

Cirrus Logic, Inc. (NASDAQ:CRUS) Q4 2020 Earnings Conference Call May 4, 2020 5:00 PM ET Company Participants Thurman Case - VP, Finance, CFO & Principal Accounting Officer Jason Rhode - CEO & Director John Forsyth - President Chelsea Heffernan - Director, IR Conference Call Participants Matthew Ramsay - Cowen and Company Tore Svanberg - Stifel, Nicolaus & Company Blayne Curtis - Barclays Bank Adam Gonzalez - Bank of America Merrill Lynch Christopher Rolland - Susquehanna Financial Group Charles Anderson - ...