SMART Global Holdings(US:SGH)2024-07-09 20:09Financial Performance - Total net sales for Q3 FY24 were $300.6 million, representing a 5.5% increase compared to the prior quarter[5]. - GAAP gross margin improved to 29.6% from 28.8% in the previous quarter, while non-GAAP gross margin increased to 32.3% from 31.5%[5]. - GAAP EPS for Q3 FY24 was $0.10, a significant recovery from $(0.26) in the prior quarter, while non-GAAP EPS rose 37% to $0.37 from $0.27[5]. - Total net sales for the three months ended May 31, 2024, were $300.58 million, a decrease of 12.7% compared to $344.42 million for the same period in 2023[18]. - Gross profit for the three months ended May 31, 2024, was $88.91 million, resulting in a gross margin of 29.6%, compared to 29.2% in the same period last year[19]. - Operating income for the three months ended May 31, 2024, was $11.51 million, a significant improvement from an operating loss of $2.39 million in the same period of 2023[18]. - Net income attributable to SMART Global Holdings for the three months ended May 31, 2024, was $5.62 million, compared to a net loss of $24.46 million in the same period last year[18]. - Non-GAAP gross profit for the three months ended May 31, 2024, was $96.96 million, with a non-GAAP gross margin of 32.3%[19]. - The company reported a basic earnings per share of $0.11 for the three months ended May 31, 2024, compared to a loss of $0.50 per share in the same period of 2023[18]. - GAAP net income for the three months ended May 31, 2024, was $5.616 million, a significant improvement from a loss of $13.620 million in the previous quarter[20]. - Non-GAAP net income for the nine months ended May 31, 2024, was $46.900 million, compared to $109.275 million for the same period in 2023, reflecting a decrease of approximately 57%[20]. Future Projections - The company expects Q4 FY24 net sales to be approximately $325 million, with a variance of +/- $25 million[6]. - Projected gross margin for Q4 FY24 is 29.5% +/- 1.5% for GAAP and 31.5% +/- 1.5% for non-GAAP[6]. - Operating expenses for Q4 FY24 are anticipated to be around $81 million +/- $2 million for GAAP and $66 million +/- $2 million for non-GAAP[6]. - Diluted EPS guidance for Q4 FY24 is $0.03 +/- $0.15 for GAAP and $0.40 +/- $0.15 for non-GAAP[6]. - The company expects continued focus on market expansion and new product development to drive future growth[19]. Company Strategy - The company is focused on transforming into a high-performance enterprise solutions provider, particularly in AI deployment[2]. - The company is committed to strategic investments in new products and technologies to enhance its market position[10]. Segment Performance - Memory Solutions segment reported net sales of $91.6 million, while Intelligent Platform Solutions generated $145.0 million in sales for Q3 FY24[3]. Balance Sheet Highlights - Total assets as of May 31, 2024, increased to $1.546 billion from $1.506 billion as of August 25, 2023, representing a growth of about 2.6%[21]. - Cash and cash equivalents rose to $453.791 million, up from $365.563 million, indicating an increase of approximately 24%[21]. - Total liabilities decreased to $1.116 billion from $1.277 billion, showing a reduction of about 12.6%[21]. - Total SGH shareholders' equity increased to $423.449 million from $222.475 million, representing a substantial growth of approximately 90.4%[21]. Cash Flow and Expenses - The company generated $79,881,000 in net cash from operating activities from continuing operations for the three months ended May 31, 2024, compared to a cash outflow of $21,917,000 in the previous quarter[22]. - SMART Global Holdings incurred capital expenditures of $3,777,000 for the three months ended May 31, 2024, down from $5,204,000 in the previous quarter[23]. - The company repaid $75,000,000 in debt during the three months ended May 31, 2024, compared to $37,211,000 in the previous quarter[23]. - The net cash used for financing activities from continuing operations was $73,313,000 for the three months ended May 31, 2024, compared to $60,152,000 in the previous quarter[23]. - The company reported a depreciation expense of $15,525,000 for the three months ended May 31, 2024, compared to $17,156,000 in the previous quarter[22]. - The company reported a net cash provided by investing activities of $5,071,000 for the three months ended May 31, 2024, compared to a cash outflow of $4,506,000 in the previous quarter[23].