Monolithic Power (MPWR) Q2 Earnings Beat on Higher Revenues

Core Insights - Monolithic Power Systems, Inc. (MPWR) reported strong second-quarter 2024 results, with both revenue and net income exceeding Zacks Consensus Estimates, driven by growth in the Enterprise Data vertical despite declines in other sectors [1][3]. Financial Performance - Net income on a GAAP basis was $100.4 million or $2.05 per share, compared to $99.5 million or $2.04 per share in the prior-year quarter [2]. - Non-GAAP net income increased to $155.1 million or $3.17 per share from $137.5 million or $2.82 per share year-over-year, beating the Zacks Consensus Estimate by $0.10 [2]. - Revenues reached $507.4 million, up from $441.1 million in the prior-year quarter, surpassing the Zacks Consensus Estimate of $485 million [3]. Revenue Breakdown - Revenue from the Enterprise Data vertical surged to $187.2 million from $48 million in the year-ago quarter, driven by higher sales of server solutions [4]. - Storage and Computing revenues declined to $114.9 million from $124.5 million due to lower sales of storage solutions [4]. - Automotive revenues fell to $87.2 million from $104.4 million, impacted by lower digital cockpit sales [5]. - Industrial revenues decreased to $32.3 million from $49.7 million, affected by soft demand for point-of-sale applications [5]. - Communications vertical revenues dropped to $43.6 million from $49.3 million due to lower infrastructure sales [6]. - Consumer end market revenues fell to $42.2 million from $65.2 million, impacted by lower gaming revenues [6]. Product Family Performance - Revenues in the DC-to-DC product family increased to $501.3 million from $418.2 million year-over-year [7]. - Lighting Control revenues decreased to $6.1 million from $22.9 million in the prior-year quarter [7]. Operational Metrics - Non-GAAP gross margin was 55.7%, down from 56.5% in the year-ago quarter, due to unfavorable variances and higher direct costs [7]. - Non-GAAP operating expenses rose to $111.7 million from $96 million in the prior-year period, while non-GAAP operating income increased to $171 million from $153.1 million [8]. Cash Flow and Liquidity - The company generated an operating cash flow of $141 million during the quarter, with cash and cash equivalents totaling $550.5 million as of June 30, 2024 [9]. Future Outlook - For the third quarter of 2024, management expects revenues to be in the range of $590 million to $610 million, with a non-GAAP gross margin projected between 55.5% and 56.1% [10].