M/A-Com (MTSI) came out with quarterly earnings of $0.79 per share, beating the Zacks Consensus Estimate of $0.78 per share. This compares to earnings of $0.58 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 1.28%. A quarter ago, it was expected that this chipmaker would post earnings of $0.73 per share when it actually produced earnings of $0.73, delivering no surprise.Over the last four quarters, the company has surpassed co ...

Financial Performance - Revenue for Q1 FY2025 was $218.1 million, a 38.8% increase from $157.1 million in Q1 FY2024 and an 8.7% increase from $200.7 million in the prior quarter[5] - Net loss for Q1 FY2025 was $167.5 million, or $2.30 loss per diluted share, compared to net income of $12.5 million, or $0.17 per diluted share, in Q1 FY2024[5] - Adjusted net income for Q1 FY2025 was $59.5 million, or $0.79 per diluted share, compared to $41.8 million, or $0.58 per diluted share, in Q1 FY2024[5] - Income from operations for Q1 FY2025 was $17.5 million, or 8.0% of revenue, compared to $11.0 million, or 7.0% of revenue, in Q1 FY2024[5] - Adjusted EBITDA (Non-GAAP) for the quarter was $62,162 thousand, representing 28.5% of revenue, compared to $44,806 thousand or 28.5% in the same quarter last year[31] Margin and Expenses - Adjusted gross margin for Q1 FY2025 was 57.5%, down from 59.2% in Q1 FY2024 and 58.1% in the prior quarter[5] - Operating expenses (GAAP) rose to $99,582 thousand, which is 45.7% of revenue, compared to $76,300 thousand or 48.6% in the prior year[31] Future Outlook - For Q2 FY2025, MACOM expects revenue to be between $227 million and $233 million, with adjusted gross margin between 57% and 58%[4] - MACOM anticipates a non-GAAP income tax rate of 3% for FY2025, reflecting its strategic financial planning[4] Strategic Initiatives - The company is focused on expanding its product portfolio and enhancing competitiveness in the semiconductor market[4] - MACOM has made strategic acquisitions, including ENGIN-IC, Inc. and Linearizer Communications Group, to strengthen its market position[8] Assets and Liabilities - Total assets increased to $1,843,630 thousand, up from $1,755,640 thousand, representing a growth of 5.0%[27] - Total current liabilities increased to $272,407 thousand from $108,184 thousand, indicating a significant rise in short-term obligations[27] Cash Flow and Debt - Cash and cash equivalents at the end of the period increased to $232,699 thousand from $163,586 thousand, marking a significant increase[29] - The company reported a loss on extinguishment of debt amounting to $193,098 thousand during the latest quarter[29] - The company made an acquisition of business, netting $(12,474) thousand during the latest quarter, compared to $(75,000) thousand in the same period last year[29]

Group 1 - Analysts project M/A-Com (MTSI) will announce quarterly earnings of $0.78 per share, a 34.5% increase year over year [1] - Revenues are expected to reach $215.07 million, reflecting a 36.9% increase from the same quarter last year [1] - The consensus EPS estimate has remained unchanged over the last 30 days, indicating analysts' reassessment of their initial estimates [1][2] Group 2 - Revenue from the Telecommunications market is forecasted to reach $56.06 million, an increase of 83% from the prior-year quarter [4] - Revenue from the Industrial & Defense market is expected to be $97.61 million, indicating a 26.8% increase year over year [4] - Revenue from the Data Center market is projected at $61.40 million, reflecting a 24% year-over-year change [4] Group 3 - M/A-Com shares have shown a return of -2.1% over the past month, compared to the Zacks S&P 500 composite's +1.7% change [5] - M/A-Com holds a Zacks Rank 3 (Hold), suggesting it is expected to mirror overall market performance in the near future [5]

Industry Overview - Semiconductor chips are essential for telecommunication equipment, electronic goods, and IoT devices, with increasing demand driven by advancements in AI technologies [1] - The 2022 Chips Act allocates $39 billion in direct grants and $75 billion in loans to revitalize domestic semiconductor production, aiming to foster innovation and expansion in the industry [2][3] - The steady rollout of 5G and investments in rural fiber infrastructure are creating healthy demand trends for semiconductor chips, with 5G being a primary catalyst for next-generation IoT services [5][6] Technological Advancements - Continuous network tuning and optimization are necessary to maintain performance standards, leading to increased demand for advanced wireless products and services [7] - The shift towards converged network structures is enabling operators to combine voice, video, and data communications, driving the development of solutions that support this convergence [8] - The proliferation of cloud networking solutions is increasing the demand for quality networking equipment, further boosting chip demand [9] Focus on Novel Technologies - Adoption of cutting-edge technologies such as AI, machine learning, and advanced networking platforms is driving higher demand for semiconductor chips [10] - The need for faster data transfer rates due to changing data consumption patterns, particularly for video content, is expected to drive the adoption of higher-speed optical and photonic components [14] Company Highlights - **MACOM Technology Solutions Holdings, Inc. (MTSI)**: Offers power analog semiconductor solutions and has a Zacks Industry Rank of 82, with a stock gain of 40.9% over the past year and long-term earnings growth expectations of 21% [13][15] - **NVIDIA Corporation (NVDA)**: A leader in visual computing technologies, NVIDIA's GPUs are benefiting from the AI boom, with a stock gain of 161.4% over the past year and long-term earnings growth expectations of 20% [16][18] - **Semtech Corporation (SMTC)**: Manufactures analog and mixed-signal semiconductors, with a Zacks Rank of 2 and a stock gain of 190% over the past year, alongside long-term earnings growth expectations of 20% [19][21]

Group 1 - M/A-Com (MTSI) is currently outperforming the Computer and Technology sector, with a year-to-date performance of 42.5% compared to the sector's average return of 31.3% [4] - The Zacks Rank system indicates M/A-Com has a strong buy rating (1), with a consensus estimate for full-year earnings increasing by 7.2% over the past quarter, reflecting positive analyst sentiment [3] - M/A-Com belongs to the Semiconductor - Analog and Mixed industry, which has seen a decline of 8.3% year-to-date, further highlighting M/A-Com's superior performance within its industry [5] Group 2 - The Computer and Technology sector includes 618 companies and is currently ranked 2 in the Zacks Sector Rank, which evaluates 16 different sector groups [2] - Meta Platforms (META) is another strong performer in the Computer and Technology sector, with a year-to-date increase of 68.7% and a Zacks Rank of 2 (Buy) [4][5] - The Internet - Software industry, where Meta Platforms operates, has 145 stocks and has returned 32.4% since the beginning of the year, indicating a competitive environment within the sector [6]

Core Insights - MACOM Technology Solutions Holdings, Inc. reported fourth-quarter fiscal 2024 earnings of 73 cents per share, aligning with the Zacks Consensus Estimate and reflecting a year-over-year increase of 30.4% [1] - The company's revenues rose 33.5% year over year to $200.71 million, slightly missing the Zacks Consensus Estimate by 0.23% [2] - Following the earnings report, MACOM shares increased by over 14%, although they have declined 49.7% year to date, underperforming the Zacks Computer & Technology sector's return of 28.5% [2] Revenue Breakdown - Telecom Market: Generated revenues of $51.7 million, accounting for 25.8% of total revenues, marking a 69% year-over-year increase due to high demand for products supporting the 5G market [3] - Data Center Market: Revenues reached $56.2 million, representing 28% of total revenues, up 38.8% from the previous year, driven by strong demand from Internet service providers [4] - Industrial & Defense Market: Generated revenues of $92.8 million, making up 17.2% of total revenues, with an 8.8% year-over-year increase, reflecting high demand for products in electronic warfare and secure communications [5] Operating Performance - Non-GAAP gross margin for the fourth quarter was 58.1%, a contraction of 200 basis points from the previous year [6] - Non-GAAP operating expenses were $65.9 million, up 24.1% year over year, but as a percentage of revenues, this figure decreased by 240 basis points to 32.9% [6] - Non-GAAP operating margin improved to 25.2%, an expansion of 50 basis points from the prior year [6] Balance Sheet Highlights - As of September 27, 2024, cash equivalents and short-term investments totaled $581.9 million, an increase from $521.5 million as of June 28, 2024 [7] - Inventories rose to $194.5 million from $190.7 million in the previous quarter [7] - Long-term debt obligations were $448.3 million, slightly up from $447.9 million in the prior quarter [7] Future Guidance - For the first quarter of fiscal 2025, MACOM expects revenues between $212 million and $218 million, exceeding the Zacks Consensus Estimate of $203.3 million [9] - The anticipated non-GAAP gross margin is projected to be between 57% and 59% [9] - Adjusted earnings per share are expected to range from 75 to 81 cents, compared to the Zacks Consensus Estimate of 72 cents [9]

Call Start: 08:30 January 1, 0000 9:35 AM ET MACOM Technology Solutions Holdings, Inc. (NASDAQ:MTSI) Q4 2024 Earnings Conference Call November 07, 2024 08:30 AM ET Company Participants Steve Ferranti - Vice President, Corporate Development & Investor Relations Steve Daly - President & Chief Executive Officer Jack Kober - Chief Financial Officer Conference Call Participants David Williams - The benchmark company Harsh Kumar - Piper Sandler Tore Svanberg - Stifel Srini Pajjuri - Raymond James Karl Ackerman - ...

For the quarter ended June 2024, M/A-Com (MTSI) reported revenue of $190.49 million, up 28.3% over the same period last year. EPS came in at $0.66, compared to $0.54 in the year-ago quarter. The reported revenue compares to the Zacks Consensus Estimate of $190.16 million, representing a surprise of +0.17%. The company has not delivered EPS surprise, with the consensus EPS estimate being $0.66. While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they co ...

Financial Data and Key Metrics Changes - Revenue for Q3 2024 was $190.5 million, representing a 5.1% sequential increase driven by growth in Data Center and Telecom end markets [22] - Adjusted EPS for Q3 was $0.66, up from $0.59 in Q2 2024 [24] - Adjusted gross profit was $109.5 million, or 57.5% of revenue, an increase of 40 basis points sequentially [22] - Free cash flow generated during the quarter exceeded $40 million, with cash and short-term investments totaling approximately $521 million at quarter-end [4][27] Business Line Data and Key Metrics Changes - Revenue performance by end market: Industrial and Defense (I&D) at $90.9 million, Telecom at $50.6 million, and Data Center at $49 million [6] - Data Center revenue increased by 13.6% sequentially, Telecom by 7.1%, while I&D remained flat [6] - The book-to-bill ratio was 1.1:1, indicating improved booking trends for the third consecutive quarter [5] Market Data and Key Metrics Changes - U.S. domestic customers accounted for approximately 46% of Q3 revenue, up from 44% in Q2 [22] - The Data Center market is experiencing significant growth opportunities due to the industry's shift to higher data rates and increased interconnect requirements [12][15] Company Strategy and Development Direction - The company aims to build a unique, best-in-class, and diversified semiconductor portfolio to capture a larger market share [21] - Focus areas include market positioning, advanced technology development, and differentiation from competitors [21] - The company is actively pursuing CHIPS Act funding for its wafer fabs in Massachusetts and North Carolina, as well as European funding for its semiconductor center in France [19][20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth of the Data Center business, projecting low to mid-teens growth in Q4, with overall revenue guidance for Q4 between $197 million and $203 million [28] - The company anticipates continued strength in the I&D market and stable revenues in Telecom, with a focus on gaining market share in 5G applications [11][28] Other Important Information - The company completed a strategic update to its 5-year plan, emphasizing the importance of long-term planning in the semiconductor industry [21] - The company is seeing increased demand for its products in satellite communications, which is expected to drive future growth [12][44] Q&A Session Summary Question: Qualification process for active copper cables - The qualification process varies by customer and application, with some customers ramping up products while others are just starting to design with them [29] Question: Market share gains in 5G - The 5G RF power opportunity is significant, with potential to double RF power revenue over the next 3 to 5 years, particularly in macro base stations and massive MIMO platforms [30][31] Question: Growth opportunities in Telecom - The acquisition of Wolfspeed has allowed the company to gain scale and more opportunities in the Telecom space, with expectations for next-generation GaN processes to enhance competitiveness [34] Question: Data Center business mix between AI and non-AI - The company does not publicly segment revenue by application but is seeing increased interest in both traditional Ethernet and higher data rate products [38] Question: Book-to-bill ratio and market recovery - Data Center bookings were the strongest, followed by I&D, while Telecom remained weak, with some activity in the SatCom industry [40] Question: Satellite communications opportunities - The company is actively engaged with customers in the satellite space, looking to supply at various levels from chip to module [42][44] Question: Silicon photonics business outlook - The company has deemphasized silicon photonics in favor of focusing on high-value applications, primarily in defense [53] Question: Customer ordering patterns and demand trends - Demand varies by market, with some areas experiencing limited demand while others, particularly in defense, are busy with new programs [56]

M/A-Com (MTSI) came out with quarterly earnings of $0.66 per share, in line with the Zacks Consensus Estimate. This compares to earnings of $0.54 per share a year ago. These figures are adjusted for non-recurring items. A quarter ago, it was expected that this chipmaker would post earnings of $0.58 per share when it actually produced earnings of $0.59, delivering a surprise of 1.72%. Over the last four quarters, the company has surpassed consensus EPS estimates three times. M/A-Com, which belongs to the Zac ...