NASDAQ$SMTC

Semtech Corp. · Q2 2023 earnings

Q2 2023 earnings · · Investor relations

Briefing

Semtech's financial performance achieved record net sales and earnings per share, driven by strong growth in Wireless and Sensing and Signal Integrity product groups, while anticipating a weaker second half due to the deteriorating macro demand environment.

Semtech reported record net sales of $209.3 million for Q2 2023, a 3.5% sequential increase and a 13.1% year-over-year increase. GAAP EPS was $0.81 and non-GAAP EPS was $0.87. The company anticipates a weaker second half performance due to the deteriorating macro demand environment.

  • Net sales reached a record $209.3 million, up 3.5% sequentially and 13.1% year-over-year.
  • GAAP gross margin was a record 64.9%, growing 50bps sequentially and 250bps year-over-year.
  • GAAP and non-GAAP diluted earnings per share were a record $0.81 and $0.87, respectively.
  • Operating cash flow was a record $77.3 million, representing 36.9% of net sales.

Headline financials

Total Revenue

$209M

Previous: $185M+13.1%
EPS (adj)

$0.87

Previous: $0.65+33.8%
Capital Expenditures

-$15.6M

Previous: -$12.7M-22.4%
Free Cash Flow

$36M

Previous: $20.2M+78.3%
Net Income

$51.6M

Previous: $32.9M+56.7%
Operating Income

$64M

Previous: $36.7M+74.7%
Gross Profit

$136M

Previous: $115M+17.7%
Cash & Equivalents

$362M

Previous: $263M+37.9%
Total Assets

$1.2B

Previous: $1.1B+9.1%
Stock-Based Comp

$13.3M

Previous: $11.5M+15.0%

Revenue & EPS history

Semtech · Revenue · Quarterly

$209M

Q2 2023+13.1%vs Q2 2022
Beat estimate in 14 of 16 quarters(88%)
ActualEstimate

Revenue by segment

Semtech · $291M total across 3 segments · Q1 2027

  • Signal Integrity
    $102M
  • Analog Mixed Signal and Wireless
    $101M
  • IoT Systems and Connectivity
    $88.3M

Forward guidance

Semtech anticipates net sales in the range of $170.0 million to $180.0 million for Q3 2023. GAAP gross margin is expected to be in the range of 64.5% to 65.6% and GAAP diluted earnings per share is expected to be in the range of $0.19 to $0.24.

Tailwinds

  • Non-GAAP Gross margin is expected to be in the range of 65.0% to 66.0%
  • Non-GAAP SG&A expense is expected to be in the range of $33.0 million to $35.0 million
  • Non-GAAP R&D expense is expected to be in the range of $32.0 million to $34.0 million
  • Non-GAAP normalized tax rate for fiscal year 2023 is expected to be approximately 12%
  • Non-GAAP Diluted earnings per share is expected to be in the range of $0.60 to $0.66

Headwinds

  • Net sales are expected to be in the range of $170.0 million to $180.0 million
  • GAAP Gross margin is expected to be in the range of 64.5% to 65.6%
  • GAAP SG&A expense is expected to be in the range of $55.2 million to $57.2 million
  • GAAP R&D expense is expected to be in the range of $36.5 million to $38.5 million
  • GAAP Diluted earnings per share is expected to be in the range of $0.19 to $0.24

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 19 quarterly earnings reports · overlaid with Q2 2023

Historical avgQ2 2023

+1.9%

Avg return

Earnings day

+2.4%

Avg return

5 days after

+4.0%

Avg return

30 days after

63%

43 / 68 earnings

Positive

+24.0%

Q3 2025

Best reaction

-28.2%

Q2 2023

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2027
Q4 2026+1.7%-17.3%+15.1%
Q3 2026+2.3%+5.9%+7.9%
Q2 2026+15.2%+13.9%+20.8%
Q1 2026-4.3%-3.3%+15.8%
Q4 2025+21.1%+27.2%-18.7%
Q3 2025+24.0%+25.8%+26.7%
Q2 2025+14.6%+18.3%+28.0%
Q1 2025+1.6%-14.5%-11.7%
Q4 2024+5.4%+1.2%+28.4%
Q3 2024+16.4%+23.6%+22.7%
Q2 2024+10.8%+6.9%-3.5%
Q1 2024+6.5%+3.3%+18.2%
Q4 2023-18.8%-27.3%-37.4%
Q3 2023+1.7%+0.6%-2.1%
Q2 2023-28.2%-26.7%-37.2%
Q1 2023+0.4%-3.0%-18.9%
Q4 2022+9.8%+11.9%-2.2%
Q3 2022+4.1%-0.4%+3.8%
Q2 2022+12.6%+11.8%+12.6%
Q1 2022+3.4%+5.9%+7.5%
Q4 2021-4.7%+0.5%-2.5%
Q3 2021+2.1%+4.5%+6.1%
Q2 2021-4.9%-6.4%-18.2%
Q1 2021+4.9%+7.2%+2.5%
Q4 2020-12.4%-26.5%+17.9%
Q3 2020+0.5%+1.6%+15.9%
Q2 2020-2.9%-2.7%+13.6%
Q1 2020-5.6%-7.9%+10.7%
Q4 2019-4.8%-0.4%-2.8%
Q3 2019+12.9%+13.6%-1.5%
Q2 2019+13.9%+19.7%+11.4%
Q1 2019+8.0%+10.5%+5.0%
Q4 2018+10.7%+13.6%+23.7%
Q3 2018-12.1%-12.8%-11.7%
Q2 2018-0.1%-1.6%-0.3%
Q1 2018-1.3%-3.5%-3.8%
Q4 2017+1.6%+2.4%-0.1%
Q3 2017+2.8%+9.2%+11.5%
Q2 2017+4.7%+6.9%+5.6%
Q1 2017+2.5%+2.6%+0.6%
Q4 2016+5.1%
Q3 2016+0.4%
Q2 2016-2.2%
Q1 2016-8.1%
Q4 2015-12.0%
Q3 2015-1.6%
Q2 2015+7.7%
Q1 2015+8.6%
Q4 2014+3.0%
Q3 2014-4.7%
Q2 2014+0.8%
Q1 2014-3.1%
Q4 2013+8.3%
Q3 2013+11.8%
Q2 2013-1.4%
Q1 2013-0.1%
Q4 2012+0.0%
Q3 2012+0.7%
Q2 2012-6.8%
Q1 2011-4.6%
Q1 2012-1.2%
Q4 2009-1.4%
Q4 2011-1.4%
Q3 2011+1.9%
Q3 2010+1.9%
Q4 2010+4.7%
Q2 2010+4.7%
Q2 2011+4.7%

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