Core Viewpoint - The article discusses the investment thesis for Monolithic Power Systems (NASDAQ: MPWR), highlighting its valuation multiples being near historically low levels and expressing strong conviction in the company's potential for growth [1]. Company Overview - Monolithic Power Systems is positioned in the semiconductor sector, which is characterized by high barriers to entry and oligopolistic market structures [1]. - The analyst has a beneficial long position in MPWR shares, indicating confidence in the company's future performance [1]. Investment Strategy - The investment approach emphasizes growth at a reasonable price, focusing on mid- to long-term investment horizons [1]. - The analyst expresses a preference for investing in larger companies, as smaller firms often carry underestimated risks [1]. Analyst Background - The analyst has a background in mechanical engineering and has transitioned from the oil and gas sector to focus on technology investments, particularly in semiconductors, robotics, and energy [1]. - The analyst holds a CFA Level II certification and is licensed by the Brazilian Securities Commission as both a portfolio manager and investment consultant [1].

Core Insights - Khaveen Investments is a global investment advisory firm focused on serving high-net-worth individuals, corporations, associations, and institutions [1] - The firm offers a wide range of services including market and security research, business valuation, and wealth management [1] - The flagship Macroquantamental Hedge Fund maintains a diversified portfolio across various asset classes, geographies, sectors, and industries [1] - The investment approach integrates top-down and bottom-up analysis, utilizing global macro, fundamental, and quantitative strategies [1] - Core expertise lies in disruptive technologies such as Artificial Intelligence, Cloud Computing, 5G, Autonomous and Electric Vehicles, FinTech, Augmented and Virtual Reality, and the Internet of Things (IoT) [1]

Core Viewpoint - Monolithic Power Systems (MPWR) has demonstrated resilience in a challenging technology sector, achieving a total return of approximately +8% in 2025, contrasting with the Technology Select Sector SPDR Fund's return of -8% [2][4]. Financial Performance - The company reported a 39% increase in total revenues, reaching nearly $638 million, surpassing analyst expectations by about 1% [4]. - Adjusted earnings per share (EPS) rose by almost 44% to $4.04, also exceeding forecasts by approximately 1% [4]. - For Q2, the company provided revenue guidance indicating a growth of 28% at the midpoint, which is nearly 3% above expectations [4]. Market Dynamics - Monolithic's stock experienced a 9% increase following its February earnings release and nearly 6% after the May 1 earnings report, although it still trades about 34% below its 52-week high [3]. - The company is facing challenges due to a decline in revenue from its Enterprise Data segment, which dropped 11% year-over-year and 31% from Q4 2024, largely attributed to its relationship with NVIDIA [5][6]. Diversification Strategy - Monolithic's revenue is diversified, with the Enterprise Data segment accounting for only 33% of total revenue, while other segments grew by over 40% year-over-year [6]. - The company continues to secure design wins in the Enterprise Data market and anticipates revenue recovery in the latter half of the year [6]. Supply Chain and Tariff Management - The company expects no significant impact from tariffs, as approximately 37% of its revenue is derived from China, supported by a "China for China" supply chain strategy [7]. Analyst Outlook - Analysts project a 12-month price target for Monolithic at $779.83, indicating a potential upside of 22.10% from the current price of $638.67 [9]. - Despite mixed updates from Wall Street regarding price targets, the average indicates a solid upside potential of 14% [8][9]. Long-Term Investment Perspective - The semiconductor industry is characterized by cyclicality, making future stock performance uncertain; however, Monolithic's long-term investment case remains strong due to the increasing demand for advanced chips [10][11].

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number: 000-51026 Monolithic Power Systems, Inc. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or or ...

Core Insights - Monolithic Power Systems, Inc. (MPWR) reported strong first-quarter 2025 results, with adjusted earnings and revenues exceeding the Zacks Consensus Estimate [1] Financial Performance - Net income on a GAAP basis was $133.8 million or $2.79 per share, up from $92.5 million or $1.89 per share year-over-year, driven by top-line growth [3] - Non-GAAP net income increased to $193.8 million or $4.04 per share from $137.5 million or $2.81 per share in the prior-year quarter, surpassing the Zacks Consensus Estimate by 4 cents [3] - Revenues reached $637.6 million, a 39.2% increase from $457.9 million in the year-ago quarter, beating the Zacks Consensus Estimate of $635 million [4] Revenue Breakdown by End Markets - Storage and Computing revenues were $188.5 million, up 77.7% year-over-year, driven by strong demand for memory and notebook solutions, exceeding the Zacks Consensus Estimate of $177.57 million [5] - Automotive revenues contributed $144.9 million, compared to $87.1 million in the year-ago quarter, though it missed the Zacks Consensus Estimate of $148.34 million [6] - Industrial revenues increased to $42.6 million from $30.2 million year-over-year, slightly beating the Zacks Consensus Estimate of $42.16 million [6] - Communications end market revenues were $71.7 million, up from $46.7 million year-over-year, but fell short of the Zacks Consensus Estimate of $73.27 million [7] - Consumer end market revenues improved to $56.9 million from $38.1 million year-over-year, missing the Zacks Consensus Estimate of $58.92 million due to lower gaming revenues [7] Operational Metrics - Non-GAAP gross margin remained stable at 55.7%, while non-GAAP operating expenses rose to $133.5 million from $103.4 million in the prior-year period [8] - Non-GAAP operating income increased to $221.5 million from $151.6 million year-over-year [8] Cash Flow and Liquidity - Operating cash flow for the quarter was $256.4 million, compared to $248 million in the prior-year quarter [10] - As of March 31, 2025, cash and cash equivalents totaled $637.4 million, with $105.8 million in other long-term liabilities [10] Future Outlook - For Q2 2025, the company estimates revenues between $640 million and $660 million, with non-GAAP gross margin expected to be between 55.2% and 55.8% [11] - GAAP gross margin is anticipated to be in the range of 54.9% to 55.5%, with GAAP operating expenses projected between $189.0 million and $195.0 million [11]

Monolithic Power (MPWR) reported $637.55 million in revenue for the quarter ended March 2025, representing a year-over-year increase of 39.2%. EPS of $4.04 for the same period compares to $2.81 a year ago.The reported revenue compares to the Zacks Consensus Estimate of $635.14 million, representing a surprise of +0.38%. The company delivered an EPS surprise of +1.00%, with the consensus EPS estimate being $4.00.While investors scrutinize revenue and earnings changes year-over-year and how they compare with ...

Group 1: Earnings Performance - Monolithic Power (MPWR) reported quarterly earnings of $4.04 per share, exceeding the Zacks Consensus Estimate of $4 per share, and up from $2.81 per share a year ago, representing an earnings surprise of 1% [1] - The company posted revenues of $637.55 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 0.38%, and compared to year-ago revenues of $457.89 million [2] - Over the last four quarters, Monolithic has consistently surpassed consensus EPS and revenue estimates [2] Group 2: Stock Performance and Outlook - Monolithic shares have increased by approximately 0.2% since the beginning of the year, while the S&P 500 has declined by 5.3% [3] - The future performance of the stock will depend on management's commentary during the earnings call and the company's earnings outlook [3][4] - The current consensus EPS estimate for the upcoming quarter is $4.04 on revenues of $636.85 million, and for the current fiscal year, it is $16.97 on revenues of $2.64 billion [7] Group 3: Industry Context - The Semiconductor - Analog and Mixed industry, to which Monolithic belongs, is currently ranked in the top 38% of over 250 Zacks industries, indicating a favorable outlook [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact stock performance [5][6]

Financial Data and Key Metrics Changes - In Q1 2025, Monolithic Power Systems (MPS) achieved record quarterly revenue of $637.6 million, which is slightly higher than Q4 2024 and 39.2% higher than Q1 2024 [3][4] - The company continues to focus on innovation and maintaining high-quality standards, which contributed to this revenue growth [4] Business Line Data and Key Metrics Changes - The Storage and Computing segment revenue increased by 38% quarter over quarter due to strong demand for memory and notebook solutions [4] - Automotive revenue increased by 13% from Q4 2024, marking the third consecutive quarter of sequential double-digit growth [4] Market Data and Key Metrics Changes - MPS is experiencing strong demand across various markets, including robotics, automotive, data centers, building automation, medical, and audio [4] - The company is diversifying its end market applications and global supply chain to capture future growth opportunities [5] Company Strategy and Development Direction - MPS is transitioning from being a chip-only semiconductor supplier to a full-service silicon-based solutions provider [5] - The company is investing in new technology and expanding into new markets to maintain supply stability and adapt to market changes [5] Management's Comments on Operating Environment and Future Outlook - Management expressed increased confidence in the enterprise data segment, anticipating design wins to ramp in the second half of the year [20][24] - The company is not forecasting specific numbers for the second half but is optimistic about overall performance due to improved visibility and design wins [20][24] Other Important Information - MPS is focusing on diversifying its manufacturing and R&D efforts globally to mitigate risks associated with tariffs and supply chain disruptions [13][17] - The company is preparing for significant growth in the automotive segment, particularly with the transition to 48-volt and 800-volt systems [42][45] Q&A Session Summary Question: Is the enterprise data segment at a low point for the year? - Management indicated that they feel more confident as they approach the second half of the year, with expectations for improvement [7][10] Question: How are global diversification efforts impacting the company? - Management highlighted that local manufacturing for local customers has been emphasized, particularly outside of China, which has improved their position [13][14] Question: Can you provide guidance on enterprise data performance? - Management stated that while they feel better about the business, they are not tightening the range of expectations yet [20][24] Question: What accounts for the slight drop in gross margin in Q2 guidance? - Management noted that the drop is due to a mix of factors and is being conservative in their outlook [25][26] Question: How significant is the market opportunity for rack power solutions? - Management expects material revenues from rack power solutions to begin in 2026, with initial developments underway [40][41] Question: What is the outlook for the automotive segment? - Management indicated that the automotive segment is expected to see significant contributions from design wins secured in previous years, particularly in North America and Europe [45][46] Question: How is the company positioned in the AI infrastructure market? - Management noted that they are well-positioned to support AI projects, with significant dollar content expected in the coming years [111][112] Question: Is there room for gross margin expansion in the second half? - Management confirmed that there is potential for gross margin expansion, but they will not increase prices for customers in the near term [130][131]

Financial Data and Key Metrics Changes - In Q1 2025, Monolithic Power Systems (MPS) achieved record quarterly revenue of $637.6 million, which is slightly higher than Q4 2024 and 39.2% higher than Q1 2024 [4][5] - The company reported strong cash flows and a diversified market strategy contributing to its performance [8] Business Line Data and Key Metrics Changes - The Storage and Computing segment revenue increased by 38% quarter over quarter due to strong demand for memory and notebook solutions [5] - Automotive revenue increased by 13% from Q4 2024, marking the third consecutive quarter of sequential double-digit growth [5] Market Data and Key Metrics Changes - MPS continues to focus on innovation and expanding into new markets, which is expected to capture future growth opportunities [6] - The company is diversifying its end market applications and global supply chain to maintain supply stability and adapt to market changes [6] Company Strategy and Development Direction - MPS is transforming from a chip-only semiconductor supplier to a full-service silicon-based solutions provider [6] - The company is investing in new technology and expanding into new markets, including robotics, automotive, data centers, building automation, medical, and audio [5] Management's Comments on Operating Environment and Future Outlook - Management expressed increased confidence in enterprise data business for the second half of the year, with expectations for design wins to ramp up [20][25] - The company is not forecasting specific numbers for the second half but is optimistic about overall performance [24][25] Other Important Information - MPS is maintaining a conservative approach to gross margin guidance, anticipating a slight decrease in Q2 due to a mix of factors [27][28] - The company is focused on maintaining its margin model and not competing on price [120] Q&A Session Summary Question: Insights on enterprise data and design wins - Management indicated that while enterprise data came in line with expectations, they expect improvements in the second half due to design wins [20][21] Question: Impact of tariffs on guidance - Management confirmed that there are no direct or indirect impacts from tariffs influencing Q2 guidance [95] Question: Growth opportunities in new products - Management highlighted the potential for significant revenue from new products, particularly in building automation and ultrasound areas [97][100] Question: Margin outlook for new products - Management stated that there is no structural change in margin profiles due to new product ramps, maintaining focus on higher-margin products [119][120] Question: Demand signals in downtrodden markets - Management noted that it is difficult to separate new product revenue ramps from overall market demand but expressed confidence in the second half of the year [122][123]

Exhibit 99.2 Monolithic Power Systems Q1'25 Earnings Commentary The highest quality power solutions for Industrial Applications, Telecom Infrastructures, Cloud Computing, Automotive, and Consumer Applications Monolithic Power Systems to Report First Quarter Results on May 1, 2025 MPS will report its results after the market closes on May 1, 2025 and host a question-and-answer webinar at 2:00 p.m. PT / 5:00 p.m. ET. The live event will be held via a Zoom webcast, which can be accessed at https://mpsic.zoom.u ...