Silicom Reports Q3 2024 Results
Silicom (NASDAQ: SILC) reported Q3 2024 financial results with revenues of $14.8 million, down from $30.1 million in Q3 2023. The company posted a GAAP net loss of $2.6 million ($0.44 per share) compared to net income of $1.2 million in Q3 2023. For the first nine months of 2024, revenues were $43.6 million versus $105.4 million in 2023. The company generated $14 million in cash and spent $8.6 million on share repurchases. Management projects Q4 2024 revenues between $14-15 million, with low single-digit growth expected in 2025 and 20-30% compound annual growth rate from 2026.
Silicom (NASDAQ: SILC) ha riportato i risultati finanziari del terzo trimestre 2024, con ricavi di $14,8 milioni, in diminuzione rispetto ai $30,1 milioni del terzo trimestre 2023. L'azienda ha registrato una perdita netta GAAP di $2,6 milioni ($0,44 per azione), rispetto a un utile netto di $1,2 milioni nel terzo trimestre 2023. Nei primi nove mesi del 2024, i ricavi sono stati di $43,6 milioni rispetto ai $105,4 milioni del 2023. L'azienda ha generato $14 milioni in cassa e ha speso $8,6 milioni per il riacquisto di azioni. La direzione prevede ricavi per il quarto trimestre 2024 tra $14 e $15 milioni, con una crescita prevista a una cifra bassa nel 2025 e un tasso di crescita annuale composto del 20-30% dal 2026.
Silicom (NASDAQ: SILC) informó los resultados financieros del tercer trimestre de 2024, con ingresos de $14,8 millones, una disminución desde los $30,1 millones en el tercer trimestre de 2023. La compañía reportó una pérdida neta GAAP de $2,6 millones ($0,44 por acción) en comparación con una ganancia neta de $1,2 millones en el tercer trimestre de 2023. En los primeros nueve meses de 2024, los ingresos fueron de $43,6 millones frente a los $105,4 millones de 2023. La compañía generó $14 millones en efectivo y gastó $8,6 millones en recompra de acciones. La dirección proyecta ingresos para el cuarto trimestre de 2024 entre $14 y $15 millones, con un crecimiento de un solo dígito bajo esperado en 2025 y una tasa de crecimiento anual compuesta del 20-30% a partir de 2026.
Silicom (NASDAQ: SILC)은 2024년 3분기 재무 결과를 발표했으며, 수익은 $14.8 백만으로 2023년 3분기의 $30.1 백만에서 감소했습니다. 회사는 GAAP 기준 순손실 $2.6 백만 ($0.44 주당) 을 기록하며, 2023년 3분기의 순이익 $1.2 백만과 비교됩니다. 2024년 첫 아홉 달 동안의 수익은 $43.6 백만으로 2023년의 $105.4 백만과 대비됩니다. 회사는 $14 백만의 현금을 생성하고, 주식 재매입에 $8.6 백만을 지출했습니다. 경영진은 2024년 4분기 수익을 $14-15 백만 사이로 예상하며, 2025년에는 낮은 한 자릿수 성장률이 예상되고, 2026년부터는 20-30%의 연평균 복합 성장률을 예상합니다.
Silicom (NASDAQ: SILC) a annoncé les résultats financiers du troisième trimestre 2024, avec des recettes de $14,8 millions, en baisse par rapport à $30,1 millions au troisième trimestre 2023. L'entreprise a affiché une perte nette GAAP de $2,6 millions ($0,44 par action) contre un bénéfice net de $1,2 millions au troisième trimestre 2023. Pour les neuf premiers mois de 2024, les recettes s'élevaient à $43,6 millions contre $105,4 millions en 2023. L'entreprise a généré $14 millions en liquidités et a dépensé $8,6 millions pour le rachat d'actions. La direction prévoit des recettes pour le quatrième trimestre 2024 comprises entre $14 et $15 millions, avec une croissance prévue à un chiffre bas en 2025 et un taux de croissance annuel composé de 20 à 30 % à partir de 2026.
Silicom (NASDAQ: SILC) hat die finanziellen Ergebnisse für das dritte Quartal 2024 veröffentlicht, mit Einnahmen von $14,8 Millionen, was einen Rückgang von $30,1 Millionen im dritten Quartal 2023 darstellt. Das Unternehmen meldete einen GAAP-Nettoverlust von $2,6 Millionen ($0,44 pro Aktie) im Vergleich zu einem Nettogewinn von $1,2 Millionen im dritten Quartal 2023. Für die ersten neun Monate 2024 lagen die Einnahmen bei $43,6 Millionen gegenüber $105,4 Millionen im Jahr 2023. Das Unternehmen generierte $14 Millionen in Bar und gab $8,6 Millionen für den Aktienrückkauf aus. Das Management projiziert Einnahmen für das vierte Quartal 2024 zwischen $14 und $15 Millionen, mit einer erwarteten niedrigen einstelligen Wachstumsrate im Jahr 2025 und einer jährlichen Wachstumsrate von 20-30% ab 2026.
- Generated $14 million in cash during first nine months of 2024
- New customer standardization agreement for Edge products expected to generate several million dollars annually from 2026
- New 400G FPGA smart NICs contract with multi-million-dollar ramp up beginning in 2026
- Strong balance sheet supporting continued share buyback program
- Q3 2024 revenues declined 51% to $14.8 million from $30.1 million in Q3 2023
- Q3 2024 GAAP net loss of $2.6 million versus $1.2 million profit in Q3 2023
- Nine-month revenues dropped 59% to $43.6 million from $105.4 million
- Continued negative impact from excess customer inventories expected through 2025
- Low single-digit growth projected for 2025
Insights
The Q3 2024 results reveal significant challenges for Silicom, with
Key concerns include inventory overhang from specific customers and delayed product adoption. However, the company maintains a strong balance sheet and has generated
The strategic wins in Edge products and 400G FPGA smart NICs provide future growth potential, but meaningful revenue impact won't materialize until 2026. The company's cost optimization efforts and strong cash position provide some stability during this transition period.
KFAR SAVA,
Financial Results
Third quarter: Silicom's revenues for the third quarter of 2024 were
On a GAAP basis, the company's net loss for the quarter totalled
On a non-GAAP basis (as described and reconciled below), net loss for the quarter totalled
First Nine Months: Silicom's revenues for the first nine months of 2024 were
On a GAAP basis, net loss for the period totalled
On a non-GAAP basis (as described and reconciled below), net loss for the period totalled
During the first nine months of 2024, the Company generated approximately
Guidance
Management projects that revenues for the fourth quarter of 2024 will range from
Comments of Management
Liron Eizenman, Silicom's President and CEO, commented, "During the third quarter, we continued to progress towards our mid- and long-term goals while dealing responsibly with our short-term challenges. While we continue to be negatively impacted by excess inventories built by specific customers in previous years - whether in reaction to supply chain disruptions only or in combination with slower-than-expected sales of their new products and services - we believe we will see improvement in the situation during 2025 and a resolution by the end of 2025."
"In the meantime, we continue moving forward according to our strategic plan, with significant milestones affirming the potential of our core Server Adapter and Edge System products to drive significant revenue growth in 2026 and beyond. For example, a service provider customer has recently decided to standardize on our Edge products for all of its deployment scenarios, making Silicom its single hardware provider for its diverse offerings. Deployments will initiate in 2025, and we expect related sales to reach several million dollars per year already in 2026. In parallel, a network equipment OEM has selected one of our high-speed 400G FPGA smart NICs for its core network architecture, with first deliveries scheduled for the first quarter of 2025 and a multi-million-dollar ramp up beginning in 2026. As we continuously increase the number of these 'slow and steady' engagements, we will benefit from ongoing revenue growth and a reduced dependency on specific large accounts. Any faster-than-projected ramp up of pipeline deals could accelerate our progress significantly."
Mr. Eizenman continued, "Looking forward, we continue to focus on achieving an EPS above
Mr. Eizenman concluded, "All in all, we are operating from an extremely solid financial platform, executing on an impressive pipeline and pursuing ambitious but achievable goals. Our team is dedicated, experienced, and fully focused on creating value - for our customers, for the market as a whole, and especially for our shareholders."
Conference Call Details
Silicom's Management will host an interactive conference today, October 31st, at 9am Eastern Time (6am Pacific Time, 3pm Israel Time) to review and discuss the results.
To participate, investors may either listen via a webcast link hosted on Silicom's website or via the dial-in. The link is under the investor relations' webcast section of Silicom's website at https://www.silicom-usa.com/webcasts/
For those that wish to dial in via telephone, one of the following teleconferencing numbers may be used:
US: 1 866 860 9642
INTERNATIONAL: +972 3 918 0609
At: 9:00am Eastern Time, 6:00am Pacific Time, 3:00pm Israel Time
It is advised to connect to the conference call a few minutes before the start.
For those unable to listen to the live call, a replay of the call will be available for three months from the day after the call under the above-mentioned webcast section of Silicom's website.
Non-GAAP Financial Measures
This release, including the financial tables below, presents other financial information that may be considered "non-GAAP financial measures" under Regulation G and related reporting requirements promulgated by the Securities and Exchange Commission (the "SEC") as they apply to our company. These non-GAAP financial measures exclude compensation expenses in respect of options and RSUs granted to directors, officers and employees, impairment of goodwill, taxes on amortization and impairment of acquired intangible assets, impairment of intangible assets and related write-offs, as well as lease liabilities - financial expenses (income). Non-GAAP financial measures should be evaluated in conjunction with, and are not a substitute for, GAAP financial measures. The tables also present the GAAP financial measures, which are most comparable to the non-GAAP financial measures as well as reconciliation between the non-GAAP financial measures and the most comparable GAAP financial measures. The non-GAAP financial information presented herein should not be considered in isolation from or as a substitute for operating income (loss), net income (loss) or per share data prepared in accordance with GAAP.
About Silicom
Silicom Ltd. is an industry-leading provider of high-performance networking and data infrastructure solutions. Designed primarily to improve performance and efficiency in Cloud and Data Center environments, Silicom's solutions increase throughput, decrease latency and boost the performance of servers and networking appliances, the infrastructure backbone that enables advanced Cloud architectures and leading technologies like NFV, SD-WAN and Cyber Security. Our innovative solutions for high-density networking, high-speed fabric switching, offloading and acceleration, which utilize a range of cutting-edge silicon technologies as well as FPGA-based solutions, are ideal for scaling-up and scaling-out cloud infrastructures.
Silicom products are used by major Cloud players, service providers, telcos and OEMs as components of their infrastructure offerings, including both add-on adapters in the Data Center and stand-alone virtualized/universal CPE devices at the edge.
Silicom's long-term, trusted relationships with more than 200 customers throughout the world, its more than 400 active Design Wins and more than 300 product SKUs have made Silicom a "go-to" connectivity/performance partner of choice for technology leaders around the globe.
For more information, please visit: www.silicom.co.il
Statements in this press Statements in this press release which are not historical data are forward-looking statements which involve known and unknown risks, uncertainties, or other factors not under the company's control, which may cause actual results, performance, or achievements of the company to be materially different from the results, performance, or other expectations implied by these forward-looking statements. These factors include, but are not limited to, Silicom's increasing dependence for substantial revenue growth on a limited number of customers, the speed and extent to which Silicom's solutions are adopted by the relevant markets, difficulty in commercializing and marketing of Silicom's products and services, maintaining and protecting brand recognition, protection of intellectual property, competition, disruptions to its manufacturing, sales & marketing, development and customer support activities, the impact of the wars in
Further information about the company's businesses, including information about factors that could materially affect Silicom's results of operations and financial condition, are discussed in our Annual Report on Form 20-F and other documents filed by the Company and that may be subsequently filed by the company from time to time with the SEC. These forward-looking statements can generally be identified as such because the context of the statement will include words such as "expect," "should," "believe," "anticipate" or words of similar import. Similarly, statements that describe future plans, objectives or goals are also forward-looking statements. In light of significant risks and uncertainties inherent in forward-looking statements, the inclusion of such statements should not be regarded as a representation by the company that it will achieve such forward-looking statements. The company disclaims any duty to update such statements, whether as a result of new information, future events, or otherwise.
Company Contact: Eran Gilad, CFO Silicom Ltd. Tel: +972-9-764-4555 E-mail: erang@silicom.co.il | Investor Relations Contact: Ehud Helft EK Global Investor Relations Tel: +1 212 378 8040 E-mail: silicom@ekgir.com |
-- FINANCIAL TABLES FOLLOW –
Silicom Ltd. Consolidated Balance Sheets | |||||
(US$ thousands) | |||||
September 30, | December 31, | ||||
2024 | 2023 | ||||
Assets | |||||
Current assets | |||||
Cash and cash equivalents | $ | 59,489 | $ | 46,972 | |
Marketable securities | 9,818 | 7,957 | |||
Accounts receivables: Trade, net | 13,264 | 25,004 | |||
Accounts receivables: Other | 7,033 | 3,688 | |||
Inventories | 43,498 | 51,507 | |||
Total current assets | 133,102 | 135,128 | |||
Marketable securities | 7,799 | 16,619 | |||
Assets held for employees' severance benefits | 1,481 | 1,357 | |||
Deferred tax assets | 2,747 | 2,359 | |||
Property, plant and equipment, net | 2,914 | 3,552 | |||
Intangible assets, net | 2,316 | 2,253 | |||
Right of Use | 7,280 | 6,466 | |||
Total assets | $ | 157,639 | $ | 167,734 | |
Liabilities and shareholders' equity | |||||
Current liabilities | |||||
Trade accounts payable | $ | 7,490 | $ | 4,139 | |
Other accounts payable and accrued expenses | 6,443 | 6,668 | |||
Lease Liabilities | 1,633 | 2,070 | |||
Total current liabilities | 15,566 | 12,877 | |||
Lease Liabilities | 5,034 | 3,877 | |||
Liability for employees' severance benefits | 2,596 | 2,672 | |||
Deferred tax liabilities | 92 | 46 | |||
Total liabilities | 23,288 | 19,472 | |||
Shareholders' equity | |||||
Ordinary shares and additional paid-in capital | 73,000 | 70,693 | |||
Treasury shares | (52,271) | (43,631) | |||
Retained earnings | 113,622 | 121,200 | |||
Total shareholders' equity | 134,351 | 148,262 | |||
Total liabilities and shareholders' equity | $ | 157,639 | $ | 167,734 |
Silicom Ltd. Consolidated Statements of Operations | |||||||||||
(US$ thousands, except for share and per share data) | |||||||||||
Three-month period | Nine-month period | ||||||||||
ended September 30, | ended September 30, | ||||||||||
2024 | 2023 | 2024 | 2023 | ||||||||
Sales | $ | 14,756 | $ | 30,057 | $ | 43,623 | $ | 105,368 | |||
Cost of sales | 10,593 | 20,821 | 31,158 | 72,185 | |||||||
Gross profit | 4,163 | 9,236 | 12,465 | 33,183 | |||||||
Research and development expenses | 4,958 | 5,231 | 14,827 | 15,622 | |||||||
Selling and marketing expenses | 1,366 | 1,946 | 4,360 | 5,343 | |||||||
General and administrative expenses | 952 | 1,099 | 2,978 | 3,205 | |||||||
Total operating expenses | 7,276 | 8,276 | 22,165 | 24,170 | |||||||
Operating income (loss) | (3,113) | 960 | (9,700) | 9,013 | |||||||
Financial income (expenses), net | 515 | 434 | 1,601 | 1,201 | |||||||
Income (loss) before income taxes | (2,598) | 1,394 | (8,099) | 10,214 | |||||||
Income taxes | 32 | 183 | (521) | 1,660 | |||||||
Net income (loss) | $ | (2,630) | $ | 1,211 | $ | (7,578) | $ | 8,554 | |||
Basic income (loss) per ordinary share (US$) | $ | (0.44) | $ | 0.18 | $ | (1.24) | $ | 1.27 | |||
Weighted average number of ordinary shares used to | 5,919 | 6,744 | 6,090 | 6,754 | |||||||
Diluted income (loss) per ordinary share (US$) | $ | (0.44) | $ | 0.18 | $ | (1.24) | $ | 1.26 | |||
Weighted average number of ordinary shares used to | 5,919 | 6,753 | 6,090 | 6,809 |
Silicom Ltd. Reconciliation of Non-GAAP Financial Results | |||||||||||
(US$ thousands, except for share and per share data) | |||||||||||
Three-month period | Nine-month period | ||||||||||
ended September 30, | ended September 30, | ||||||||||
2024 | 2023 | 2024 | 2023 | ||||||||
GAAP gross profit | $ | 4,163 | $ | 9,236 | $ | 12,465 | $ | 33,183 | |||
(1) Share-based compensation (*) | 82 | 105 | 193 | 323 | |||||||
Non-GAAP gross profit | $ | 4,245 | $ | 9,341 | $ | 12,658 | $ | 33,506 | |||
GAAP operating income (loss) | $ | (3,113) | $ | 960 | $ | (9,700) | $ | 9,013 | |||
Gross profit adjustments | 82 | 105 | 193 | 323 | |||||||
(1) Share-based compensation (*) | 777 | 834 | 2,113 | 2,091 | |||||||
Non-GAAP operating income (loss) | $ | (2,254) | $ | 1,899 | $ | (7,394) | $ | 11,427 | |||
GAAP net income (loss) | $ | (2,630) | $ | 1,211 | $ | (7,578) | $ | 8,554 | |||
Operating income (loss) adjustments | 859 | 939 | 2,306 | 2,414 | |||||||
(2) Lease liabilities - Financial expenses (income) | 98 | (163) | (9) | (467) | |||||||
(3) Taxes on amortization and impairment of acquired intangible assets | 22 | 68 | 397 | 203 | |||||||
Non-GAAP net income (loss) | $ | (1,651) | $ | 2,055 | $ | (4,884) | $ | 10,704 | |||
GAAP net income (loss) | $ | (2,630) | $ | 1,211 | $ | (7,578) | $ | 8,554 | |||
Adjustments for Non-GAAP Cost of sales | 82 | 105 | 193 | 323 | |||||||
Adjustments for Non-GAAP Research and development expenses | 386 | 412 | 986 | 1,010 | |||||||
Adjustments for Non-GAAP Selling and marketing expenses | 191 | 199 | 537 | 548 | |||||||
Adjustments for Non-GAAP General and administrative expenses | 200 | 223 | 590 | 533 | |||||||
Adjustments for Non-GAAP Financial income (loss), net | 98 | (163) | (9) | (467) | |||||||
Adjustments for Non-GAAP Income taxes | 22 | 68 | 397 | 203 | |||||||
Non-GAAP net income (loss) | $ | (1,651) | $ | 2,055 | $ | (4,884) | $ | 10,704 | |||
GAAP basic income (loss) per ordinary share (US$) | $ | (0.44) | $ | 0.18 | $ | (1.24) | $ | 1.27 | |||
(1) Share-based compensation (*) | 0.14 | 0.13 | 0.37 | 0.35 | |||||||
(2) Lease liabilities - Financial expenses (income) | 0.02 | (0.02) | - | (0.07) | |||||||
(3) Taxes on amortization and impairment of acquired intangible assets | - | 0.01 | 0.07 | 0.03 | |||||||
Non-GAAP basic income (loss) per ordinary share (US$) | $ | (0.28) | $ | 0.30 | $ | (0.80) | $ | 1.58 | |||
GAAP diluted income (loss) per ordinary share (US$) | $ | (0.44) | $ | 0.18 | $ | (1.24) | $ | 1.26 | |||
(1) Share-based compensation (*) | 0.14 | 0.13 | 0.37 | 0.35 | |||||||
(2) Lease liabilities - Financial expenses (income) | 0.02 | (0.02) | - | (0.07) | |||||||
(3) Taxes on amortization and impairment of acquired intangible assets | - | 0.01 | 0.07 | 0.03 | |||||||
Non-GAAP diluted income (loss) per ordinary share (US$) | $ | (0.28) | $ | 0.30 | $ | (0.80) | $ | 1.57 | |||
(*) Adjustments related to share-based compensation expenses according to ASC topic 718 (SFAS 123 (R)) | |||||||||||
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SOURCE Silicom Ltd.
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