Silicon Laboratories, Inc. (NASDAQ:SLAB) Q3 2022 Earnings Conference Call October 26, 2022 8:30 AM ET Company Participants Giovanni Pacelli - Senior Director of Finance John Hollister - Chief Financial Officer Matt Johnson - President and Chief Executive Officer Austin Dean - Investor Relations Conference Call Participants Matthew Ramsay - Cowen Gary Mobley - Wells Fargo Securities Blayne Curtis - Barclays Rajvindra Gill - Needham & Company Jeremy Kwan - Stifel Nicholas Operator Good day, everyone. My name ...

SILICON LABS | --- | --- | --- | --- | --- | --- | --- | --- | |------------------|-----------------------|-------|-------|-------|-------|-------|-------| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Silicon Labs Investor | | | | | | | | | Presentation | | | | | | | | October 26, 2022 | | | | | | | | | | | | | | | | | Private Securities Litigation Reform Act of 1995 This presentation contains forward-looking statements based on Silicon Labs' current expectat ...

Silicon Laboratories Inc. (NASDAQ:SLAB) Q2 2022 Earnings Conference Call July 27, 2022 8:30 AM ET Company Participants Giovanni Pacelli - Senior Director of Finance Matt Johnson - President and Chief Executive Officer John Hollister - Chief Financial Officer Conference Call Participants Raji Gill - Needham & Company Gary Mobley - Wells Fargo Securities Matt Ramsay - Cowen & Company Tore Svanberg - Stifel Nicolaus Blayne Curtis - Barclays Operator Hello. My name is Sarah, and I will be your conference operat ...

Company Overview - Silicon Labs is a leader in secure, intelligent wireless technology, serving approximately 25,000 customers and holding around 1,400 patents[5,8,9] - The company's vision is to empower developers to create wirelessly connected devices that transform industries, grow economies, and improve lives[14] Market Position and Growth - Silicon Labs consistently outperforms the market in year-over-year growth[26,27] - The Edge IoT market is large and accelerating, with an estimated market opportunity of $17.4 billion[28,29] - The Industrial & Commercial market segment is experiencing a 15% SAM CAGR from 2021-2025 due to global utility refresh and smart infrastructure deployments[30] - The Home & Life market segment shows durable demand and a growing opportunity, with a CAGR of over 12% from 2021-2025[31] Strategy and Portfolio - Silicon Labs has a broad and deep wireless portfolio, unmatched in the industry[39] - The company is an ecosystem leader, defining the future of IoT with a wide range of protocols and technology partners[37,44] - Silicon Labs is positioned to win, lead, and scale in the Home & Life market, actively shaping the future of IoT[43] Financial Performance and Targets - The company is targeting a long-term revenue CAGR of approximately 20%[46] - Silicon Labs aims for a long-term target model with mid-50s% gross margin and operating income in the mid-20s% of sales at $1.5 billion revenue[46] - The company has a $15.5 billion opportunity pipeline and design win growth of +44% in 2021[46]

Financial Data and Key Metrics Changes - Revenue for Q1 2022 reached a record $234 million, representing a 48% year-on-year growth, exceeding guidance [6][10] - Non-GAAP gross margin was nearly 67%, driven by selling lower-cost inventory from 2021, with expectations of moderation in future quarters [10][13] - Non-GAAP operating margin for Q1 was 24%, attributed to strong revenue performance and effective operating expense leverage [12] - Non-GAAP earnings per share for Q1 was $1.05, significantly above guidance [13][19] Business Line Data and Key Metrics Changes - Industrial & Commercial business generated $127 million in revenue, growing 61% year-on-year, with strong performance in commercial infrastructure and industrial applications [7] - Home & Life business revenue was $107 million, up 35% year-on-year, driven by smart home and security applications [8] - Distribution channel revenue accounted for 82% of total sales, indicating a broad customer base with no single customer exceeding 5% of revenue [8][9] Market Data and Key Metrics Changes - Revenue growth was observed across all geographies, with the Americas showing the strongest growth, followed by Europe and Asia Pacific [9] - The geographical mix of the business is now balanced across the Americas, Europe, and Asia Pacific [9] Company Strategy and Development Direction - The company aims to lead the IoT market, focusing on wireless connectivity and expanding its platform-based approach to address a wide range of applications [25][32] - The opportunity pipeline has grown to over $14 billion, indicating strong future revenue potential [24] - The company is preparing for the release of the new Matter standard, which is expected to enhance its product offerings [27] Management's Comments on Operating Environment and Future Outlook - Management noted that demand continues to outpace supply, with design win momentum increasing by 79% year-on-year [23][24] - The company anticipates revenue growth in Q2 2022 to range between $245 million and $255 million, with expected declines in gross margin due to rising manufacturing costs [17][19] - Management expressed confidence in navigating supply chain challenges and maintaining strong operational performance [39][50] Other Important Information - The company ended Q1 with cash and investments of $1.9 billion and returned $250 million to shareholders through share repurchases [15][16] - The board authorized an additional $350 million in share repurchases for the remainder of the year [16] Q&A Session Summary Question: Revenue growth expectations for fiscal year 2022 - Management remains encouraged by strong business momentum and design win growth, but will guide one quarter at a time [38] Question: Gross margin outlook - Management expects gross margins to moderate, potentially falling below 60% by the end of the fiscal year due to various cost pressures [41] Question: Segment growth rates - Industrial & Commercial is expected to have slightly higher growth potential compared to Home & Life, driven by larger market opportunities [45] Question: Supply chain predictability - Management indicated that supply chain conditions are becoming more predictable, although constraints remain [46] Question: Impact of lockdowns in China - The company has been able to navigate supply chain challenges effectively, despite concerns regarding lockdowns in China [50] Question: Inventory management and customer behavior - Management noted that while customers may consider holding more inventory, it is too early to determine long-term strategies [63][64] Question: Pricing strategy for new contracts - The company aims to provide competitive pricing for design wins, ensuring long-term pricing stability [69] Question: Capacity conditions with foundry partners - Management expressed confidence in securing additional supply from foundry partners, with a focus on meeting future demand [75]

SILICON LABS | --- | --- | --- | --- | --- | --- | --- | --- | |-----------------------|-------|-------|-------|-------|-------|-------|-------| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Silicon Labs Investor | | | | | | | | | Presentation | | | | | | | | | April 27, 2022 | | | | | | | | Private Securities Litigation Reform Act of 1995 This presentation contains forward-looking statements based on Silicon Labs' current expectations. The words "believe," "est ...

SILICON LABS | --- | --- | --- | --- | --- | --- | --- | |-----------------------|-------|-------|-------|-------|-------|-------| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Silicon Labs Investor | | | | | | | | Presentation | | | | | | | | February 2 nd , 2022 | | | | | | | | | | | | | | | Private Securities Litigation Reform Act of 1995 This presentation contains forward-looking statements based on Silicon Labs' current expectations. The words "believe," "estimate," ...

Silicon Laboratories Inc. (NASDAQ:SLAB) Q4 2021 Earnings Conference Call February 2, 2022 8:30 AM ET Company Participants Matt Johnson - President, Chief Executive Officer John Hollister - Senior Vice President, Chief Financial Officer Giovanni Pacelli - Senior Director, Finance Austin Dean - Manager, Investor Relations Conference Call Participants Gary Mobley - Wells Fargo Securities Raji Gill - Needham & Co. Alessandra Vecchi - William Blair Blayne Curtis - Barclays Tore Svanberg - Stifel Srini Pajjuri - ...

Financial Data and Key Metrics Changes - The company achieved record quarterly revenue of $185 million in Q3 2021, representing a 9% increase from the previous quarter and a 39% year-on-year growth in IoT revenue [8][11] - Non-GAAP gross margin exceeded expectations at 59.4%, while GAAP gross margin was reported at 59.2% [15][19] - Non-GAAP operating expenses increased to $93 million, primarily due to R&D investments [17] - Non-GAAP earnings per share from continuing operations were $0.34, above the high-end of guidance [18] Business Line Data and Key Metrics Changes - Wireless IoT solutions were the primary revenue growth driver, with a robust 48% year-on-year growth [13] - Significant growth was noted in home automation, security, smart retail, portable medical, and sports and fitness sectors [12] - WiFi revenue more than doubled year-on-year, following the Redpine acquisition [28] Market Data and Key Metrics Changes - The Americas and Europe showed the greatest strength in Q3, with APAC showing slight growth [14] - Distribution revenue accounted for 81% of total sales, indicating a diverse customer base [14] Company Strategy and Development Direction - The company is focused on maintaining strong customer relationships while implementing price increases to offset supplier cost increases [16][55] - The introduction of the Custom Part Manufacturing Service (CPMS) aims to enhance customer security and simplify supply chains, providing a competitive edge [33][64] - The company is committed to capturing significant market opportunities in the IoT sector, emphasizing wireless connectivity [27][36] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing supply chain constraints but expressed confidence in increasing supply to meet growing demand [46][90] - The company expects revenue for Q4 2021 to be in the range of $195 million to $205 million, with non-GAAP earnings per share projected between $0.50 and $0.60 [25] - Management highlighted the importance of balancing pricing power with maintaining long-term customer relationships [55][78] Other Important Information - The company completed a divestiture of its infrastructure and automotive business, recording a one-time gain of $2.1 billion [20] - A modified Dutch auction tender offer repurchased approximately $640 million of common stock, retiring about 4 million shares [23][24] Q&A Session Summary Question: Impact of wafer supply on revenue growth - Management indicated that supply constraints are expected to continue, but demand is increasing, widening the gap [46][47] Question: Share count post-accelerated share repurchase - Estimated share count for Q4 is around 39 million shares [48] Question: Pricing environment and cost increases - Management confirmed substantial pricing power in the IoT market and is passing on cost increases to customers while maintaining relationships [54][55] Question: Long-term operating margin outlook - Management remains committed to the profitability model and is pleased with current performance, with no changes to long-term outlook [59] Question: Details on the CPMS program - The CPMS program allows customers to customize devices during manufacturing, enhancing security and simplifying supply chains [62][64] Question: Channel inventory and bookings stability - Channel inventory is stable, and bookings remain elevated, indicating strong demand [82] Question: Demand landscape for IoT - Demand is strong across various technologies and markets, with an acceleration in design-wins contributing to growth [86][87] Question: Capacity commitments from suppliers - Management is actively working to secure additional supply and expects to increment supply each quarter moving into 2022 [90][91] Question: Gross margin volatility and mix shift - Management noted that certain product lines carry higher margins, and favorable mix shifts are contributing to current gross margin performance [93]

SILICON LABS | --- | --- | --- | --- | --- | --- | --- | --- | --- | |------------------|-----------------------|-------|-------|-------|-------|-------|-------|-------| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Silicon Labs Investor | | | | | | | | | | Presentation | | | | | | | | | October 27, 2021 | | | | | | | | | Private Securities Litigation Reform Act of 1995 This presentation contains forward-looking statements based on Silicon Labs' curr ...