EX-99.1 2 exhibit991earningreleasema.htm EX-99.1 Q3'24 ER Document

Exhibit 99.1

Alpha and Omega Semiconductor Reports Financial Results for the Fiscal Third Quarter of 2024 Ended March 31, 2024

SUNNYVALE, California, May 7, 2024 - Alpha and Omega Semiconductor Limited (“AOS”) (NASDAQ: AOSL) today reported financial results for the fiscal third quarter of 2024 ended March 31, 2024.

The results for the fiscal third quarter of 2024 ended March 31, 2024 were as follows:

GAAP Financial Comparison
Quarterly
(in millions, except percentage and per share data)
(unaudited)
Three Months Ended
March 31,
2024		December 31,
2023		March 31,
2023
Revenue$150.1 $165.3 $132.6 
Gross Margin23.7 %26.6 %23.2 %
Operating Loss$(10.5)$(1.1)$(14.4)
Net Loss$(11.2)$(2.9)$(18.9)
Net Loss Per Share - Diluted$(0.39)$(0.10)$(0.68)

Non-GAAP Financial Comparison
Quarterly
(in millions, except percentage and per share data)
(unaudited)
Three Months Ended
March 31, 2024December 31, 2023March 31, 2023
Revenue$150.1 $165.3 $132.6 
Non-GAAP Gross Margin25.2 %28.0 %25.1 %
Non-GAAP Operating Income (Loss)$(1.1)$8.4 $(2.9)
Non-GAAP Net Income (Loss)$(1.2)$7.2 $(5.9)
Non-GAAP Net Income (Loss) Per Share - Diluted$(0.04)$0.24 $(0.21)


The non-GAAP financial measures in the schedule above and under the section “Financial Results for Fiscal Q3 Ended March 31, 2024” below exclude the effect of share-based compensation expenses, amortization of purchased intangible, legal costs related to government investigation, equity method investment loss from equity investee, and income tax effect of non-GAAP adjustments in each of the periods presented. A detailed reconciliation of GAAP and non-GAAP financial measures is included at the end of this press release.


Financial Results for Fiscal Q3 Ended March 31, 2024
•Revenue was $150.1 million, a decrease of 9.2% from the prior quarter and an increase of 13.2% from the same quarter last year.
•GAAP gross margin was 23.7%, down from 26.6% in the prior quarter and up from 23.2% in the same quarter last year.
•Non-GAAP gross margin was 25.2%, down from 28.0% in the prior quarter and up from 25.1% in the same quarter last year.
•GAAP operating expenses were $46.1 million, up from $45.1 million in the prior quarter and up from $45.2 million in the same quarter last year.
•Non-GAAP operating expenses were $38.9 million, up from $37.9 million from last quarter and up from $36.2 million in the same quarter last year.
•GAAP operating loss was $10.5 million, up from $1.1 million of operating loss in the prior quarter and down from $14.4 million of operating loss in the same quarter last year.
•Non-GAAP operating loss was $1.1 million as compared to $8.4 million of operating income for the prior quarter and $2.9 million of operating loss for the same quarter last year.
•GAAP net loss per diluted share was $0.39, compared to $0.10 net loss per share for the prior quarter, and $0.68 net loss per share for the same quarter a year ago.
•Non-GAAP net loss per share was $0.04 compared to $0.24 net income per share for the prior quarter and 0.21 net loss per share for the same quarter a year ago.
•Consolidated cash flow provided by operating activities was $28.2 million, as compared to $23.5 million of cash flow used in operating activities in the prior quarter.
•The Company closed the quarter with $174.4 million of cash and cash equivalents.

AOS Chief Executive Officer Stephen Chang commented, “Our fiscal Q3 results were in-line with our guidance driven by seasonal declines in computing, smartphones, and quick chargers. We saw initial indications that inventory corrections across certain markets are nearing completion, setting the stage for a gradual recovery. Seasonality is starting to return as we prepare for PC and smartphone launches in the Fall.”

Mr. Chang continued, "Looking beyond calendar 2024, AOS is transitioning from a component supplier to become a comprehensive solution provider, enabling us to 'go deeper' with increasing BOM content while penetrating new products and verticals. We are confident that our leading technology, extensive product portfolio, and Tier 1 customer base strategically position us well to outperform the broader markets we serve. We are optimistic about the future and look forward to executing on the opportunities ahead of us."


Business Outlook for Fiscal Q4 Ending June 30, 2024

The following statements are based on management's current expectations. These statements are forward-looking, and actual results may differ materially. AOS undertakes no obligation to update these statements.

Our expectations for the fiscal fourth quarter of year 2024 are as follows:

•Revenue to be approximately $160 million, plus or minus $10 million.
•GAAP gross margin to be 24.7%, plus or minus 1%. We anticipate non-GAAP gross margin to be 26.3%, plus or minus 1%.
•GAAP operating expenses to be in the range of $47.9 million, plus or minus $1 million. Non-GAAP operating expenses are expected to be in the range of $39.5 million, plus or minus $1 million.
•Net interest expense to be approximately $0.5 million, and
•Income tax expense to be approximately $0.9 million.

Conference Call and Webcast

AOS plans to hold an investor teleconference and live webcast to discuss the financial results for the fiscal third quarter ended March 31, 2024 today, May 7, 2024 at 2:00 p.m. PT / 5:00 p.m. ET. To listen to the live conference call, please dial +1 (833) 470-1428 or +1 (404) 975-4839 if dialing from outside the United States and Canada. The access code is 819299. A live webcast of the call will also be available in the "Events & Presentations" section of the company's investor relations website, http://investor.aosmd.com. The webcast replay will be available for seven days after the live call on the same website. In addition, a copy of the script of management's prepared remarks and a live webcast of the call will also be available in the "Events & Presentations" section of the company's investor relations website, http://investor.aosmd.com.



Forward-Looking Statements

This press release contains forward-looking statements that are based on current expectations, estimates, forecasts and projections of future performance based on management's judgment, beliefs, current trends, and anticipated product performance. These forward-looking statements include, without limitation, market trends in the semiconductor industry, our ability to mitigate economic downturns and current cycles, seasonality of our business, our ability to penetrate new markets and achieve long-term growth, our ability to improve our financial performance in 2024, our ability to increase BOM content, our projected amount of revenue, gross margin, operating income (loss), income tax expenses, net income (loss), and share-based compensation expenses, non-GAAP gross margin, non-GAAP operating expenses, income tax expenses, our ability to continue to win and acquire market share and other information under the section entitled “Business Outlook for Fiscal Q4 Ending June 30, 2024”. Forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking statements. These factors include, but are not limited to, the state of semiconductor industry and seasonality of our markets; government policies on our business operations in China; our lack of control over the joint venture in China; difficulties and challenges in executing our diversification strategy into different market segments; ordering pattern from distributors and seasonality; changes in regulatory environment and government investigation; our ability to introduce or develop new and enhanced products that achieve market acceptance; decline of PC markets; the actual product performance in volume production; the quality and reliability of our product, our ability to achieve design wins; the general business and economic conditions; our ability to maintain factory utilization at a desirable level; and other risks as described in our SEC filings, including our Annual Report on Form 10-K for the fiscal year ended June 30, 2023 filed by AOS with the SEC and other periodic reports we filed with the SEC. Other unknown or unpredictable factors or underlying assumptions subsequently proving to be incorrect could cause actual results to differ materially from those in the forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance, or achievements. You should not place undue reliance on these forward-looking statements. All information provided in this press release is as of today's date, unless otherwise stated, and AOS undertakes no duty to update such information, except as required under applicable law.


Use of Non-GAAP Financial Measures

To supplement our unaudited consolidated financial statements presented on a basis consistent with U.S. GAAP, we disclose certain non-GAAP financial measures for our historical performance, including non-GAAP gross profit, gross margin, operating expenses, operating income (loss), net income (loss), diluted earnings per share ("EPS") and EBITDAS. These supplemental measures exclude, among other items, share-based compensation expenses, legal and profession fees related to government investigation, amortization of purchased intangible, income tax effect of non-GAAP adjustments and equity method investment (income) loss from equity investee. We also disclose certain non-GAAP financial measures in our guidance for the next quarter, including non-GAAP gross margin and operating expenses. We believe that these historical and forecast non-GAAP financial measures provide useful information to both management and investors by excluding certain items and expenses that are not indicative of our core operating results or do not reflect our normal business operations. In addition, our management uses non-GAAP measures to compare our performance relative to forecasts and to benchmark our performance externally against competitors. Our use of non-GAAP financial measures has certain limitations in that such non-GAAP financial measures may not be directly comparable to those reported by other companies. For example, the terms used in this press release, such as non-GAAP net income (loss) or non-GAAP operating expenses, do not have a standardized meaning. Other companies may use the same or similarly named measures, but exclude different items, which may not provide investors with a comparable view of our performance in relation to other companies. In addition, we included the amount of income tax effect of non-GAAP adjustments in the non-GAAP net income (loss) of reconciliation table for all periods presented as the management believes that such non-GAAP presentation provides useful information to investors, even though the amounts are not significant. We seek to compensate for the limitation of our non-GAAP presentation by providing a detailed reconciliation of the non-GAAP financial measures to the most directly comparable U.S. GAAP measures both in the text in this press release and in the tables attached hereto. Investors are encouraged to review the related U.S. GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable U.S. GAAP financial measures.


About Alpha and Omega Semiconductor

Alpha and Omega Semiconductor Limited, or AOS, is a designer, developer, and global supplier of a broad range of discrete power devices, wide band gap power devices, power management ICs, and modules, including a wide portfolio of Power MOSFET, SiC, IGBT, IPM, TVS, HV Gate Drivers, Power IC, and Digital Power products. AOS has developed extensive intellectual property and technical knowledge that encompasses the latest advancements in the power semiconductor industry, which enables us to introduce innovative products to address the increasingly complex power requirements of advanced electronics. AOS differentiates itself by integrating its Discrete and IC semiconductor process technology, product design, and advanced packaging know-how to develop high-performance power management solutions. AOS’ portfolio of products targets high-volume applications, including portable computers, flat-panel TVs, LED lighting, smartphones, battery packs, consumer and industrial motor controls, automotive electronics, and power supplies for TVs, computers, servers, and telecommunications equipment. For more information, please visit www.aosmd.com.






The following unaudited condensed consolidated financial statements are prepared in accordance with U.S. GAAP.


    
Alpha and Omega Semiconductor Limited
Condensed Consolidated Statements of Operations
(in thousands, except percentages and per share amounts)
(unaudited)
Three Months Ended
Nine Months Ended
 March 31,
2024		December 31,
2023		March 31,
2023		March 31,
2024		March 31,
2023
Revenue$150,060 $165,285 $132,560 $495,978 $529,796 
Cost of goods sold114,505 121,284 101,774 365,497 374,841 
Gross profit35,555 44,001 30,786 130,481 154,955 
     Gross margin23.7 %26.6 %23.2 %26.3 %29.2 %
Operating expenses:
Research and development23,095 22,919 22,578 68,127 65,435 
Selling, general and administrative22,964 22,216 22,610 64,611 69,603 
Total operating expenses46,059 45,135 45,188 132,738 135,038 
Operating income (loss)(10,504)(1,134)(14,402)(2,257)19,917 
Other income (loss), net308 (472)(513)(138)(1,432)
Interest income (expense), net271 274 5 774 (1,000)
Net income (loss) before income taxes(9,925)(1,332)(14,910)(1,621)17,485 
Income tax expense 611 894 2,517 2,643 5,550 
Net income (loss) before income (loss) from equity method investment(10,536)(2,226)(17,427)(4,264)11,935 
Equity method investment income (loss) from equity investee(676)(697)(1,480)(4,085)1,533 
Net income (loss) $(11,212)$(2,923)$(18,907)$(8,349)$13,468 
Net income (loss) per common share
Basic$(0.39)$(0.10)$(0.68)$(0.30)$0.49 
Diluted$(0.39)$(0.10)$(0.68)$(0.30)$0.46 
Weighted average number of common shares used to compute net income (loss) per share
Basic28,433 27,939 27,710 28,022 27,537 
Diluted28,433 27,939 27,710 28,022 29,576 



Alpha and Omega Semiconductor Limited
Condensed Consolidated Balance Sheets
(in thousands, except par value per share)
(unaudited)
 March 31, 2024June 30, 2023
ASSETS
Current assets:
Cash and cash equivalents$174,387 $195,188 
Restricted cash208 415 
Accounts receivable, net13,254 22,420 
Inventories198,098 183,247 
Other current assets8,604 22,666 
Total current assets394,551 423,936 
Property, plant and equipment, net339,515 357,831 
Operating lease right-of-use assets24,421 24,349 
Intangible assets, net4,328 6,765 
Equity method investment 359,244 366,617 
Deferred income tax assets 499 536 
Other long-term assets31,491 19,703 
Total assets$1,154,049 $1,199,737 
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable$42,513 $50,775 
Accrued liabilities73,587 79,533 
Payable related to equity investee, net
14,275 11,950 
Income taxes payable4,490 5,546 
Short-term debt11,584 11,434 
Deferred revenue7,664 8,073 
Finance lease liabilities917 867 
Operating lease liabilities4,909 4,383 
Total current liabilities159,939 172,561 
Long-term debt29,653 38,360 
Income taxes payable - long-term2,978 2,817 
Deferred income tax liabilities26,337 27,283 
Finance lease liabilities - long-term2,522 3,216 
Operating lease liabilities - long-term20,099 20,544 
Other long-term liabilities23,584 51,037 
Total liabilities265,112 315,818 
Shareholders' Equity:
Preferred shares, par value $0.002 per share:
Authorized: 10,000 shares; issued and outstanding: none at March 31, 2024 and June 30, 2023— — 
Common shares, par value $0.002 per share:
Authorized: 100,000 shares; issued and outstanding: 35,836 shares and 28,697 shares, respectively at March 31, 2024 and 34,811 shares and 27,654 shares, respectively at June 30, 2023
72 70 
Treasury shares at cost: 7,139 shares at March 31, 2024 and 7,157 shares at June 30, 2023(79,220)(79,365)
Additional paid-in capital345,413 329,034 
Accumulated other comprehensive loss(11,125)(8,111)
Retained earnings633,797 642,291 


Total shareholders' equity888,937 883,919 
Total liabilities and shareholders' equity$1,154,049 $1,199,737 







Alpha and Omega Semiconductor Limited
Selected Cash Flow Information
( in thousands, unaudited)
Nine Months Ended March 31,
20242023
Net cash provided by operating activities$18,591 $48,654 
Net cash used in investing activities(28,593)(90,603)
Net cash used in financing activities(10,923)(6,417)
Effect of exchange rate changes on cash, cash equivalents and restricted cash(83)(121)
Net decrease in cash, cash equivalents and restricted cash(21,008)(48,487)
Cash, cash equivalents and restricted cash at beginning of period195,603 314,651 
Cash, cash equivalents and restricted cash at end of period$174,595 $266,164 


Alpha and Omega Semiconductor Limited
Reconciliation of Condensed Consolidated GAAP Financial Measures to Non-GAAP Financial Measures
(in thousands, except percentages and per share data)
(unaudited)
Three Months Ended
Nine Months Ended
March 31,
2024		December 31,
2023		March 31,
2023		March 31,
2024		March 31,
2023
GAAP gross profit$35,555 $44,001 $30,786 130,481 $154,955 
   Share-based compensation1,424 1,504 1,723 3,140 5,259 
   Amortization of purchased intangible812 812 812 2,435 2,435 
Non-GAAP gross profit$37,791 $46,317 $33,321 $136,056 $162,649 
Non-GAAP gross margin as a % of revenue25.2 %28.0 %25.1 %27.4 %30.7 %
GAAP operating expense$46,059 $45,135 $45,188 $132,738 $135,038 
   Share-based compensation 7,041 7,187 8,709 14,934 28,860 
Legal costs related to government investigation103 16 304 172 556 
Non-GAAP operating expense$38,915 $37,932 $36,175 $117,632 $105,622 
GAAP operating income (loss)$(10,504)$(1,134)$(14,402)$(2,257)$19,917 
   Share-based compensation 8,465 8,691 10,432 18,074 34,119 
   Amortization of purchased intangible812 812 812 2,435 2,435 
Legal costs related to government investigation103 16 304 172 556 
Non-GAAP operating income (loss)$(1,124)$8,385 $(2,854)$18,424 $57,027 
Non-GAAP operating margin as a % of revenue(0.7)%5.1 %(2.2)%3.7 %10.8 %
GAAP net income (loss) $(11,212)$(2,923)$(18,907)$(8,349)$13,468 
   Share-based compensation 8,465 8,691 10,432 18,074 34,119 
   Amortization of purchased intangible812 812 812 2,435 2,435 
Equity method investment (income) loss from equity investee676 697 1,480 4,085 (1,533)
Legal costs related to government investigation103 16 304 172 556 
   Income tax effect of non-GAAP adjustments(47)(96)3 (549)244 
Non-GAAP net income (loss)$(1,203)$7,197 $(5,876)$15,868 $49,289 
Non-GAAP net margin as a % of revenue(0.8)%4.4 %(4.4)%3.2 %9.3 %
GAAP net income (loss) $(11,212)$(2,923)$(18,907)$(8,349)$13,468 
   Share-based compensation 8,465 8,691 10,432 18,074 34,119 
   Amortization and depreciation13,325 13,573 11,006 39,849 31,162 
Equity method investment (income) loss from equity investee676 697 1,480 4,085 (1,533)
   Interest expense (income), net(271)(274)(5)(774)1,000 
   Income tax expense 611 894 2,517 2,643 5,550 
EBITDAS$11,594 $20,658 $6,523 $55,528 $83,766 
GAAP diluted net income (loss) per share $(0.39)$(0.10)$(0.68)$(0.28)$0.46 
 Share-based compensation 0.30 0.29 0.38 0.60 1.15 
 Amortization of purchased intangible0.03 0.03 0.03 0.08 0.08 
Equity method investment (income) loss from equity investee0.02 0.02 0.05 0.14 (0.05)


Legal costs related to government investigation0.00 0.00 0.01 0.01 0.02 
 Income tax effect of non-GAAP adjustments(0.00)(0.00)0.00 (0.02)0.01 
Non-GAAP diluted net income (loss) per share$(0.04)$0.24 $(0.21)$0.53 $1.67 
Weighted average number of common shares used to compute GAAP diluted net income (loss) per share28,433 27,939 27,710 28,022 29,576 
Weighted average number of common shares used to compute Non-GAAP diluted net income (loss) per share28,433 29,874 27,710 29,915 29,576 




Investor and media inquiries:

The Blueshirt Group
Gary Dvorchak, CFA
In US +1 323 240 5796
In China +86 (138) 1079-1480
gary@blueshirtgroup.co

Steven Pelayo
The Blueshirt Group
steven@blueshirtgroup.co
+1 (360) 808-5154