Presentation Transcript

1. Cirrus Logic

   September Quarter Fiscal Year 2011 Investor Update
2. Safe Harbor Statement Except for historical information contained herein, the matters set forth in this presentation contain forward-looking statements, including industry market projections; our revenue growth opportunities; future product releases; and forecasted revenue, gross margin, and R&D and SG&A expenses. These forward-looking statements are based on our current expectations, estimates and assumptions and are subject to certain risks and uncertainties that could cause actual results to differ materially from our current expectations, estimates and assumptions and the forward-looking statements made in this presentation. These risks and uncertainties include, but are not limited to, the risk factors listed in our Form 10-K for the year ended March 27, 2010, and in other filings with the Securities and Exchange Commission. The foregoing information concerning our business outlook represents our outlook as of the date of this presentation, and we undertake no obligation to update or revise any forward-looking statements, whether as a result of new developments or otherwise.
3. Cirrus Logic Overview (NASDAQ: CRUS) Founded 1984 – Headquarters in Austin, Texas ~534 Worldwide More than 3,000 active customers with 700 innovative products ~ 1,100 patents ~$182 Million in cash, with no debt Fabless pioneer since early ’80s
4. September Quarter Update +81%Revenue Growth Sep.’10 vs. Sep. ’09 Quarter 56%Gross Margin Sep. Quarter ’10 High Growth Strong Margin 29%GAAP Operating ProfitSep. Quarter ’10 $0.42 GAAP diluted income per shareSep. Quarter ’10 Improved Profit Increased Earnings
5. Diverse Applications - Similar Technologies EnergyIndustrialMeas. Pro & AutoAudio Car Amplifiers MusicInstruments Weigh Scale Seismic Sensors Digital Utility Meters Energy Control HomeAudio Home Theater MotorControl PFC (Power Factor Correction) Soundbar Media PC PortableAudio Smart Phone BluetoothHeadsets MediaPlayers Tablets
6. Our Vision Be the first choice in high-performance analog and mixed-signal components Focus on key tier one customers
7. Tier One Customer Base Focus on Tier One Customers Highly innovative custom ICs Building strong engineering relationships Focus on winning multiple designs Driven by Custom ICs 100% share at Itron for power meters More custom ICs for Japanese and automotive customers coming soon Best Long-Term Growth Opportunity Focus on the best customers in select key growth markets #1Customer
8. Our #1 Customer Five Custom ICs to Date and Growing Best-in-class for audio quality and power consumption Strong Engineering Relationship Track record of exceptional execution Multiple Designs Shipping the critical audio component in all major product lines Phones, portable devices and computers Expanded from initial, single design win in 2005 #1Customer As Percentage of Total Revenue 44% 39% 34% 34% Q4FY10 Q1FY11 Q2FY11 Q3FY10
9. Our Long-Term Growth Drivers EnergyControl Portable Audio Soundbars Power Meter Meters & Monitors 2009 2010 2011 & Beyond
10. Unique Corporate Culture Our “Rockstar” Team Over 65% of all employees are engineers ~50% have master degrees and PhDs Inspired and focused employees Core for our long-term sustainable success Attracting the Best Talent Recognized as a “Best Companies” to work for Currently 94% of employees think “Cirrus is a great place to work”, up from 83% in ‘08 Well below industry average turnover rate
11. 25 Years of Mixed-Signal Innovation 375 250 Proprietary Products Broad IP Portfolio New digital energy Audio and Delta Sigma converters Apex Precision Power products Magnetic storage, graphics, etc. Valuable Assets ~1,000 patents Strong patent portfolio protects our market position August 2010: sold several patents for $4M 150 115 65 50 10
12. Pioneer of the Fabless Semiconductor Model Focus on lowering costs and cycle time Over 75% of assembly and test is under the same roof 5 Foundries, 4 Assembly, and 6 Test Partners 0.25um to 0.18um technology sweet spot 205,000,000 ICs Shipped in 2009 Tight controls over channel inventory
13. Our Global Customer Base EU North America Japan & Korea China & Asia = Customer Design Location = Device Manufacturing Location = Location of Consumption Design locations are key for driving revenue success Source: Based on Cirrus Logic estimates
14. Audio Market: $2B and Growing Total Market Share 2008: 5% 2009: 7% (estimate) Target Market Share #2 in portable audio converters #3 in home audio converters and interface #3 in car amplifier converters In millions Source: The World Market for Audio ICs - 2009
15. Growth in Home Audio Applications Soundbars Total System Solution Offers High Content Opportunity (~$5) Audio DSP, Audio Converters and Audio Amplifier Technology Blu-ray Players
16. Automotive Audio Applications Ford SYNC Tier-1 Customers: Bose, Harman, Ford, Sirius XM Car Amplifiers Developing New Custom Audio Chipset for Amplifiers Satellite Radio
17. Smartphones: Fast Growing Market 497Mu 439Mu 384Mu +22%CAGR 2009-2014 322Mu 247Mu 182Mu 2009 2010 2011 2012 2013 2014 Source: Mobile Handset Q1 2010 Market Tracker
18. Our New Smartphone Products CS42L73 Low-power Smart Audio Codec reduces system power consumption CS35L01 Low-power analog input hybrid Class D audio amplifier
19. Portable Audio Applications Smartphone Tablets BluetoothHeadsets Media Players AudioCODECs AudioAmplifiers Audio DSP Our Ultra Lower Power Audio Products
20. Generations of Smaller Board Space Highest audio quality across all generations 3rd Gen (77 mm2 area) 2nd Gen (110 mm2 area) 1st Gen (287 mm2 area) Competition(at market entry) 65% Less Space* 30% Less Space++ 60%Less Space+ ++vs. Our 2nd Generation +vs. Our 1st Generation *vs. Competitors
21. Generations of Lower Power Consumption Highest audio quality across all generations 3rd Gen (xx mm2 area) 3rd Gen (3 mW ) 2nd Gen ( 5 mW) Competition (at market entry) 1st Gen (13 mW) 10% Less Power* 40% Less Power++ 60%Less Power+ ++vs. Our 2nd Generation +vs. Our 1st Generation *vs. Competitors
22. Our Sustainable Advantage Key Customer Focused Innovation Longer Battery Life Lower System Cost Smaller Footprint Fewer External Components Higher Audio Quality Simpler Design Deep Applications Knowledge ~ 1,000 Patents 25 Years of Mixed-Signal Innovation
23. Energy Overview Power FactorCorrection (PFC) LED Lighting, Motor Control Power Meter Foundational Industrial and Energy
24. Power Meter: The Smart Grid Interface Energy Measurement ICs (ADC) Since 1999 Smart Grid Upgrades Drive Growth Focus on Key Customers and Emerging Markets
25. Energy Monitoring: New Emerging Market = BasicMeters = Monitoring = SmartMeters 200Mu 150Mu HomeEnergyMonitors ServerPower Supplies White Goods 100Mu Strong portfolio of measurement ADCs 50Mu 2010 2011 2012 2013 2014 2014 Source: Company Estimates and IMS WW Metering
26. The First Digital PFC that Beats Analog Switching Power Supplies Digital PFC AC/DC Adapters Better Light Load Efficiency Lower System Cost Higher Reliability Lighting Ballasts First Design Wins Fall 2010
27. PFC: Big and Growing Market 1,200,000,000Annual Units $400M $300M $200M $100M 2008 2009 2010 2011 2012 2013 Source; IMS Power ICs 2009
28. Digital Energy Control is the Future Our Strategy High innovation for PFCs which are a common building block in AC power Expanding to more integrated ICs Focus on innovation for key customers Digital Control Leverage our mixed-signal expertise for digital energy (EXL Core) Over 2 years in development Over 53 patents and patents pending Best-in-class performance Digital control allows for intelligent shaping EMI which reduces filter requirements, leading to significant lower system cost
29. Digital Energy Products Roadmap Power Meters & Monitoring LED Lighting PFC Brushless DC Motor Controller Growth Driver in 2010
30. Financials
31. Revenue Growth 118% Year-Over-Year RevenueGrowth Multiple Sources of Growth 87% 81% Portable Audio 49% 35%+ Power Meter Energy Base Business Q4FY10 Q1FY11 Q2FY11 Q3FY10 Q3FY11(Forecast*) *Guidance as of October 21st , 2010
32. Revenue and Financials $101M $88M+ September Quarter (Q2) Revenue: $100.6M(up 81% y/y) GM: 56% R&D/SGA: $27.7M (incl. $3M in stock comp and other) December Guidance (Q3)(as of October 21, 2010) Revenue: $88-$94M(up over 35% y/y) GM: 54%-56% R&D and SG&A: $28M-$30M (incl. $2.5M in stock comp and other) $82M $65M $63M $56M $38M $34M Q4FY10 Q1FY11 Q2FY11 Q4FY09 Q1FY10 Q2FY10 Q3FY10 Q3FY11(Forecast*) *Guidance as of October 21st , 2010
33. Growth Driven by New Products “New” Products: less than 3 years since market introduction “Prime” Products: more than 3 years and less than 7 years since market introduction “Legacy” Products: more than 7 years since market introduction
34. Strong Margins Cirrus Logic Gross Margins 57% 56% 56% 56% 56% 55% 54% 55% 52% 52% Q1FY09 Q2FY09 Q3FY09 Q4FY09 Q1FY10 Q2FY10 Q3FY10 Q4FY10 Q1FY11 Q2FY11 43% 44% 26% 35% 50% 41% 34% 33% 35% 27% 29% 71% 67% 57% 66% 74% 50% 59% 56% 65% 73% Revenue split between Audio and Energy
35. Earnings and Operating Profit 0.42 0.40 Operating Margins* 0.31 0.30 0.25 0.19 0.17 = GAAP EPS 0.16 = Non-GAAP EPS * 0.11 0.10 0.07 0.04 $460M+ Federal NOLs No federal tax expense No Debt 0.00 (0.01) (0.01) (0.12) Q4FY10 Q1FY11 Q3FY09 Q4FY09 Q1FY10 Q2FY10 Q3FY10 Q2FY10 * GAAP to non-GAAP reconciliations available on slide40 and at www.cirrus.com
36. Financial Strength Cash Generation Investing our Cash Backend capacity IT Infrastructure Key Technology Investments Strong Cash Generation $24.2M cash flow from operations in Q2FY11 $182.4M in total cash $58.4M in actual cash generation the last 4 quarters (19% of revenue)
37. GAAP to Non-GAAP Reconciliation
38. Summary Multiple Revenue Growth Opportunities Strong Revenue Growth Today