Power Integrations(US:POWI)2025-11-05 13:38Financial Performance - Net revenues for Q3 2025 were $118.9 million, a 2.4% increase from $115.8 million in Q3 2024[11] - Gross profit for Q3 2025 was $64.9 million, compared to $63.2 million in Q3 2024, reflecting a gross margin improvement[11] - Operating expenses increased to $68.8 million in Q3 2025 from $51.6 million in Q3 2024, primarily due to higher research and development costs[11] - The company reported a net loss of $1.4 million in Q3 2025, a significant decline from a net income of $14.3 million in Q3 2024[11] - Basic earnings per share for Q3 2025 were $(0.02), down from $0.25 in Q3 2024[11] - Total comprehensive loss for Q3 2025 was $(1.3) million, compared to a comprehensive income of $18.5 million in Q3 2024[14] - Net income for the nine months ended September 30, 2025, was $8,803,000, a decrease of 61.9% compared to $23,094,000 for the same period in 2024[19] - The Company’s operating loss for the three months ended September 30, 2025, was $(3.95) million, compared to an operating income of $11.6 million in the same period of 2024[90] Cash Flow and Equity - Net cash provided by operating activities increased to $85,312,000 for the nine months ended September 30, 2025, compared to $66,455,000 in 2024, reflecting a growth of 28.3%[19] - Cash and cash equivalents at the end of the period were $48,646,000, down from $58,469,000 at the end of the previous period, a decrease of 16.5%[19] - Total stockholders' equity decreased to $672.0 million as of September 30, 2025, from $749.2 million a year earlier[17] - Net cash used in financing activities was $128,325,000 for the nine months ended September 30, 2025, compared to $54,379,000 in 2024, indicating a significant increase in cash outflows[19] Research and Development - Research and development expenses for the nine months ended September 30, 2025, were $76.8 million, up from $75.1 million in the same period of 2024[11] - Research and development expenses for the three months ended September 30, 2025, were $23.8 million, compared to $22.8 million in the same period of 2024, reflecting an increase of approximately 4.4%[90] Stock and Shareholder Actions - The company repurchased $64.0 million of common stock during the nine months ended September 30, 2025[17] - The Company repurchased 919,000 shares of common stock during the three months ended September 30, 2025, and 2,028,000 shares during the nine months ended September 30, 2025[67][68] - As of September 30, 2025, the outstanding common stock shares were 55,312,000, down from 56,840,000 at the same time in 2024[67] - The Company declared cash dividends of $0.21 per share for the three months ended September 30, 2025, compared to $0.20 per share in the same period of 2024, reflecting a 5% increase[74] - Total cash dividends declared and paid for the nine months ended September 30, 2025, amounted to $35.6 million, up from $34.1 million in the same period of 2024[74] Customer and Sales Information - The top ten customers accounted for approximately 81% of net revenues for both the three and nine months ended September 30, 2025, compared to 78% for the same periods in 2024[59] - Sales to distributors were $82.3 million and $238.7 million for the three and nine months ended September 30, 2025, respectively, compared to $80.5 million and $220.4 million in the same periods of 2024[59] - Geographic net revenues for the Americas were $6.2 million for the three months ended September 30, 2025, and $17.7 million for the nine months ended September 30, 2025, showing growth from $5.5 million and $15.8 million in 2024[66] Legal and Acquisition Activities - The Company recognized a charge of $9.2 million in other operating expenses related to a jury verdict in favor of the plaintiff for claims of harassment based on disability and retaliation[95] - An additional $0.7 million was recognized in the quarter ended September 30, 2025, related to plaintiff attorney fees and costs[95] - The total potential exposure related to the litigation amounts to an additional $5.2 million in expenses[95] - The Company acquired Odyssey Semiconductor Technologies for $9.52 million in cash to enhance its development of high-power GaN switching technology[100] - Goodwill from the acquisition is expected to be deductible over 15 years for tax purposes[101] - The fair value of in-process research and development will be recorded as an intangible asset with an indefinite life until completion[102] Management and Governance - The Company’s Chief Financial Officer resigned effective October 4, 2025, with an interim CFO appointed[104] - The Company maintained a valuation allowance on its deferred tax assets in California and New Jersey as of September 30, 2025, indicating ongoing tax strategy considerations[82] Marketable Securities and Investments - The total fair value of the company's cash equivalents and short-term marketable securities as of September 30, 2025, was $196,485,000, down from $252,388,000 at December 31, 2024, representing a decrease of 22.2%[37] - The company reported a total marketable securities value of $193,214,000 as of September 30, 2025, compared to $249,023,000 at December 31, 2024, reflecting a decline of 22.5%[40] - The company classified its marketable securities as available-for-sale, with a total amortized cost of $191,170,000 and gross unrealized gains of $2,045,000 as of September 30, 2025[40] - The fair value measurement of corporate securities at September 30, 2025, included $191,733,000 classified under Level 2 of the fair-value hierarchy[37] - The company holds corporate securities with an amortized cost of $155,800,000 due in 12 months or greater, with an estimated fair market value of $157,636,000[40] - The company expects the fair value of its marketable securities to recover as they reach maturity, despite current declines due to interest rate changes[45]