Alpha and Omega Semiconductor Reports Financial Results for Fiscal Fourth Quarter and Fiscal Year Ended June 30, 2018
SUNNYVALE, Calif.--(BUSINESS WIRE)--Aug 8, 2018--Alpha and Omega Semiconductor Limited (“AOS”) (NASDAQ: AOSL), today reported financial results for the fiscal fourth quarter and the fiscal year ended June 30, 2018.
The results for the fiscal fourth quarter of 2018 ended June 30, 2018 were as follows:
The non-GAAP financial measures in the schedule above exclude the effect of share-based compensation expenses in each of the periods presented, and pre-production costs relating to the Chongqing joint venture for the quarter ended June 30, 2018 and March 31, 2018. A detailed reconciliation of GAAP and non-GAAP financial measures is included at the end of this press release.
The results for the fiscal year ended June 30, 2018 were as follows:
The non-GAAP financial measures in the schedule above exclude the effect of share-based compensation expenses in each of the periods presented, as well as pre-production expenses relating to the Chongqing joint venture and income tax benefit from tax reform for fiscal year ended June 30, 2018. A detailed reconciliation of GAAP and non-GAAP financial measures is included at the end of this press release.
“AOS delivered another quarter of outstanding execution, breaking revenue records both on a quarterly and annual basis. The solid June quarter brought a strong finish to our fiscal year 2018: we achieved an annual revenue growth of 10%, a non-GAAP gross margin expansion of 270 basis points, and non-GAAP earnings per share increase of 37%, as compared to a year ago. During fiscal year 2018, we dedicated our efforts to enhance demand creation and expand capacity. I am pleased to announce that the critical investments and heavy lifting of our internal capacity expansion are now largely behind us,” stated Dr. Mike Chang, chairman and CEO of the company. “As we entered fiscal year 2019 with stronger and more diverse product portfolio, increased capacity and enhanced customer partnerships, we are optimistic that our investments in the past year will enable us to capitalize on the next phase of accelerated growth. We remain keenly focused on executing our longer term strategies.”
Business Outlook for Fiscal Q1 Ending September 30, 2018
The following forward-looking statements are based on management’s current expectations and actual results may differ materially. AOS undertakes no obligation to update these statements.Revenue is expected to be between $113 million and $117 million. Gross margin is expected to be approximately 26.5% plus or minus 1%. Non-GAAP gross margin is expected to be approximately 28.5% plus or minus 1%. Non-GAAP gross margin excludes $0.6 million of estimated share-based compensation charge and $1.7 million of estimated production ramp-up costs relating to the Chongqing joint venture. Operating expenses are expected to be in the range of $32.0 million plus or minus $1 million. Non-GAAP operating expenses are expected to be in the range of $24.2 million plus or minus $1 million. Both GAAP and non-GAAP operating expenses include $2.1 million to $2.3 million of estimated expenses relating to the development of our digital power team. Non-GAAP operating expenses exclude an estimated share-based compensation charge of approximately $2.8 million and estimated pre-production expenses relating to the Chongqing joint venture of $5.0 million. Tax expense is expected to be approximately $0.6 million to $0.8 million. Loss attributable to noncontrolling interest is expected to be around $4.2 million. On a non-GAAP basis, excluding estimated pre-production expenses and production ramp-up costs relating to the Chongqing joint venture of approximately $3.5 million, this item is expected to be approximately $0.7 million.
Conference Call and Webcast
AOS plans to conduct an investor teleconference and live webcast to discuss the financial results for the fiscal fourth quarter and the fiscal year ended June 30, 2018 today, August 8, 2018 at 2:00 p.m. PT / 5:00 p.m. ET. To participate in the live call, analysts and investors should dial 877-312-8797 (or 253-237-1194 if outside the U.S.). To access the live webcast and the subsequent replay of the conference call, which will be available for seven days after the live call, go to the “Events & Presentations” section of the company’s investor relations website, http://investor.aosmd.com. In addition, a copy of the script of prepared remarks by CEO and CFO at the investor teleconference and webcast is available prior to the call at the Company’s investor relations website.
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, statements relating to expected growth rate, our product portfolios, projected amount of revenue, gross margin, operating income (loss), income tax expenses, net income (loss), noncontrolling interest, and share-based compensation expenses, non-GAAP gross margin, non-GAAP operating expenses, tax expenses, and non-GAAP loss attributable to noncontrolling interest, our ability and strategy to develop new products, including digital power controller products, the ability to expand our sales, increase our capacity and achieve sustained growth and profitability, the pre-production and production phases of our Chongqing joint venture, the relationship with key customers, and other information under the section entitled “Business Outlook for Fiscal Q1 Ending September 30, 2018”. 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, difficulties and challenges in executing our diversification strategy into different market segments; ordering pattern from distributors and seasonality; our ability to introduce or develop new and enhanced products that achieve market acceptance, 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, the state of semiconductor industry and seasonality of our markets, our ability to maintain factory utilization at a desirable level, our ability to successfully operate our joint venture in China, and other risks as described in our SEC filings, including our Annual Report on Form 10-K for the fiscal year ended June 30, 2018 to be filed by AOS. 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 income (loss), net loss attributable to noncontrolling interest, net income (loss) and diluted earnings per share (“EPS”). These supplemental measures exclude share-based compensation expenses for all periods presented, pre-production expenses related to Chongqing joint venture for the quarter of March 31, 2018 and June 30, 2018, and income tax benefit from tax reform for the quarter of December 31, 2017 in this press release. We also disclose certain non-GAAP financial measures in our guidance for the next quarter, including non-GAAP gross margin, operating expenses and loss attributable to noncontrolling interest. These forecast supplemental measures exclude estimated pre-production expenses and production ramp-up costs relating to our Chongqing joint venture and estimated share-based compensation expenses. We believe that these historical and forecast non-GAAP financial measures can 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, such as the joint venture pre-production expenses. 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 the non-GAAP financial measures we use 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. 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 power semiconductors, including a wide portfolio of Power MOSFET, IGBT, IPM, Power IC products and Digital Power. 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’s portfolio of products targets high-volume applications, including portable computers, flat panel TVs, LED lighting, smart phones, battery packs, consumer and industrial motor controls and power supplies for TVs, computers, servers and telecommunications equipment. For more information, please visit www.aosmd.com.
The following unaudited consolidated financial statements are prepared in accordance with U.S. GAAP.
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