FALSE000077240600007724062024-08-062024-08-06




UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
______________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported):    August 6, 2024
Commission File Number
 CIRRUS LOGIC, INC.
(Exact name of Registrant as specified in its charter)
Delaware 000-17795 77-0024818
(State or Other Jurisdiction of
Incorporation or Organization)		(Commission File Number)(IRS Employer
Identification No.)
800 W. 6th StreetAustin,TX78701
(Address of Principal Executive Offices)(Zip Code)
Registrant’s telephone number, including area code:
(512)
851-4000
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbol Name of each exchange on which registered
Common stock, $0.001 par valueCRUSThe NASDAQ Stock Market LLC
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐



Item 2.02 Results of Operations and Financial Condition.

On August 6, 2024, Cirrus Logic, Inc. (“Cirrus Logic” or the “Company”) issued a press release announcing its financial results for its first quarter fiscal year 2025. The full text of the press release is furnished as Exhibit No. 99.1 to this Current Report on Form 8-K.

Item 7.01 Regulation FD Disclosure

On August 6, 2024, in addition to issuing a press release, the Company posted on its website a shareholder letter to investors summarizing the financial results for its first quarter fiscal year 2025. The full text of the shareholder letter is furnished as Exhibit No. 99.2 to this Current Report on Form 8-K.

Use of Non-GAAP Financial Information

To supplement Cirrus Logic's financial statements presented on a GAAP basis, Cirrus has provided non-GAAP financial information, including non-GAAP net income, diluted earnings per share, operating income and profit, operating expenses, gross margin and profit, tax expense, tax expense impact on earnings per share, effective tax rate, free cash flow and free cash flow margin. A reconciliation of the adjustments to GAAP results is included in the press release below. Non-GAAP financial information is not meant as a substitute for GAAP results, but is included because management believes such information is useful to our investors for informational and comparative purposes. In addition, certain non-GAAP financial information is used internally by management to evaluate and manage the company. The non-GAAP financial information used by Cirrus Logic may differ from that used by other companies. These non-GAAP measures should be considered in addition to, and not as a substitute for, the results prepared in accordance with GAAP.

The information contained in Items 2.02, 7.01, and 9.01 in this Current Report on Form 8-K and the exhibits furnished hereto contain forward-looking statements regarding the Company and cautionary statements identifying important factors that could cause actual results to differ materially from those anticipated. In addition, this information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall they be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit            Description

Exhibit 99.1    Cirrus Logic, Inc. press release dated August 6, 2024
Exhibit 99.2    Cirrus Logic, Inc. shareholder letter dated August 6, 2024
Exhibit 104    Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)



SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 CIRRUS LOGIC, INC.
 
 
Date:August 6, 2024By:/s/ Ulf Habermann
 Name:Ulf Habermann
 Title:Interim Chief Financial Officer


Exhibit 99.1
    
image_0.jpg
FINANCIAL NEWS

    


Cirrus Logic Reports Fiscal First Quarter Revenue of $374.0 Million


AUSTIN, Texas – August 6, 2024 – Cirrus Logic, Inc. (NASDAQ: CRUS) today posted on its website at investor.cirrus.com the quarterly Shareholder Letter that contains the complete financial results for the first quarter of fiscal year 2025, which ended June 29, 2024, as well as the company’s current business outlook.
“Cirrus Logic delivered revenue above the top end of our guidance range in the June quarter driven by stronger-than-expected shipments into smartphones,” said John Forsyth, Cirrus Logic president and chief executive officer. “In addition to these strong results, during the quarter we began ramping production of our custom boosted amplifier and first 22-nanometer smart codec ahead of new smartphone launches that are expected later this year. We also executed against our growth strategy to drive product and end-market diversification as we saw strong design activity in laptops and introduced the latest products in a series of data converters targeting professional audio, consumer, and industrial applications. With a compelling roadmap of products and an outstanding track record of execution, we believe we are well-positioned to grow long-term shareholder value.”

Reported Financial Results – First Quarter FY25
•Revenue of $374.0 million;
•GAAP and non-GAAP gross margin of 50.5 percent and 50.6 percent;
•GAAP operating expenses of $142.1 million and non-GAAP operating expenses of $118.0 million; and
•GAAP earnings per share of $0.76 and non-GAAP earnings per share of $1.12.

A reconciliation of GAAP to non-GAAP financial information is included in the tables accompanying this press release.


Business Outlook – Second Quarter FY25
•Revenue is expected to range between $490 million and $550 million;
•GAAP gross margin is forecasted to be between 50 percent and 52 percent; and
•Combined GAAP R&D and SG&A expenses are anticipated to range between $149 million and $155 million, including approximately $22 million in stock-based compensation expense and $2 million in amortization of acquired intangibles, resulting in a non-GAAP operating expense range between $125 million and $131 million.

Cirrus Logic will host a live Q&A session at 5 p.m. EDT today to discuss its financial results and business outlook. Participants may listen to the conference call on the investor relations website at investor.cirrus.com. A replay of the webcast can be accessed on the Cirrus Logic website approximately two hours following its completion or by calling (609) 800-9909 or toll-free at (800) 770-2030 (Access Code: 95424).

About Cirrus Logic, Inc.
Cirrus Logic is a leader in low-power, high-precision mixed-signal processing solutions that create innovative user experiences for the world’s top mobile and consumer applications. With headquarters in Austin, Texas, Cirrus Logic is recognized globally for its award-winning corporate culture.

Cirrus Logic, Cirrus and the Cirrus Logic logo are registered trademarks of Cirrus Logic, Inc. All other company or product names noted herein may be trademarks of their respective holders.

Investor Contact:                            
Chelsea Heffernan
Vice President, Investor Relations
Cirrus Logic, Inc.                            
(512) 851-4125                            
Investor@cirrus.com





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Use of non-GAAP Financial Information
To supplement Cirrus Logic's financial statements presented on a GAAP basis, the company has provided non-GAAP financial information, including non-GAAP net income, diluted earnings per share, operating income and profit, operating expenses, gross margin and profit, tax expense, tax expense impact on earnings per share, effective tax rate, free cash flow, and free cash flow margin. A reconciliation of the adjustments to GAAP results is included in the tables below. Non-GAAP financial information is not meant as a substitute for GAAP results but is included because management believes such information is useful to our investors for informational and comparative purposes. In addition, certain non-GAAP financial information is used internally by management to evaluate and manage the company. The non-GAAP financial information used by Cirrus Logic may differ from that used by other companies. These non-GAAP measures should be considered in addition to, and not as a substitute for, the results prepared in accordance with GAAP.

Safe Harbor Statement
Except for historical information contained herein, the matters set forth in this news release contain forward-looking statements including our statements about our expectation for new smartphone launches later this year; our belief that we are well-positioned to grow long-term shareholder value; and our estimates for the second quarter fiscal year 2025 revenue, gross margin, combined research and development and selling, general and administrative expense levels, stock-based compensation expense, and amortization of acquired intangibles. In some cases, forward-looking statements are identified by words such as “expect,” “anticipate,” “target,” “project,” “believe,” “goals,” “opportunity,” “estimates,” “intend,” and variations of these types of words and similar expressions. In addition, any statements that refer to our plans, expectations, strategies, or other characterizations of future events or circumstances are forward-looking statements. 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, and readers should not place undue reliance on such statements. These risks and uncertainties include, but are not limited to, the following: the level and timing of orders and shipments during the second quarter of fiscal year 2025, customer cancellations of orders, or the failure to place orders consistent with forecasts, along with the risk factors listed in our Form 10-K for the year ended March 30, 2024 and in our other filings with the Securities and Exchange Commission, which are available at www.sec.gov. The foregoing information concerning our business outlook represents our outlook as of the date of this news release, and we expressly disclaim any obligation to update or revise any forward-looking statements, whether as a result of new developments or otherwise.
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Summary Financial Data Follows:

CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
(in thousands, except per share data; unaudited)
Three Months Ended
Jun. 29,Mar. 30,Jun. 24,
202420242023
Q1'25Q4'24Q1'24
Audio$218,970 $226,681 $195,806 
High-Performance Mixed-Signal155,056 145,146 121,210 
Net sales374,026 371,827 317,016 
Cost of sales185,101 179,202 157,629 
Gross profit188,925 192,625 159,387 
Gross margin50.5 %51.8 %50.3 %
Research and development105,363 103,383 106,215 
Selling, general and administrative36,770 36,866 35,379 
Total operating expenses142,133 140,249 141,594 
Income from operations46,792 52,376 17,793 
Interest income8,202 7,360 4,600 
Other income (expense)1,609 (78)377 
Income before income taxes56,603 59,658 22,770 
Provision for income taxes14,508 14,816 7,170 
Net income $42,095 $44,842 $15,600 
Basic earnings per share$0.79 $0.83 $0.28 
Diluted earnings per share:$0.76 $0.81 $0.28 
Weighted average number of shares:
Basic53,433 53,739 54,862 
Diluted55,665 55,559 56,631 
Prepared in accordance with Generally Accepted Accounting Principles

4




RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL INFORMATION
(in thousands, except per share data; unaudited)
(not prepared in accordance with GAAP)
Non-GAAP financial information is not meant as a substitute for GAAP results, but is included because management believes such information is useful to our investors for informational and comparative purposes. In addition, certain non-GAAP financial information is used internally by management to evaluate and manage the company. As a note, the non-GAAP financial information used by Cirrus Logic may differ from that used by other companies. These non-GAAP measures should be considered in addition to, and not as a substitute for, the results prepared in accordance with GAAP.
Three Months Ended
Jun. 29,Mar. 30,Jun. 24,
202420242023
Net Income ReconciliationQ1'25Q4'24Q1'24
GAAP Net Income$42,095 $44,842 $15,600 
Amortization of acquisition intangibles1,972 1,973 2,170 
Stock-based compensation expense21,385 22,158 22,715 
Lease impairment1,019 — — 
Acquisition-related costs— — 3,166 
Adjustment to income taxes(4,105)75 (5,628)
Non-GAAP Net Income$62,366 $69,048 $38,023 
Earnings Per Share Reconciliation
GAAP Diluted earnings per share$0.76 $0.81 $0.28 
Effect of Amortization of acquisition intangibles0.03 0.03 0.04 
Effect of Stock-based compensation expense0.38 0.40 0.40 
Effect of Lease impairment0.02 — — 
Effect of Acquisition-related costs— — 0.05 
Effect of Adjustment to income taxes(0.07)— (0.10)
Non-GAAP Diluted earnings per share$1.12 $1.24 $0.67 
Operating Income Reconciliation
GAAP Operating Income$46,792 $52,376 $17,793 
GAAP Operating Profit 12.5 %14.1 %5.6 %
Amortization of acquisition intangibles1,972 1,973 2,170 
Stock-based compensation expense - COGS266 362 285 
Stock-based compensation expense - R&D15,763 15,483 15,952 
Stock-based compensation expense - SG&A5,356 6,313 6,478 
Lease impairment1,019 — — 
Acquisition-related costs— — 3,166 
Non-GAAP Operating Income$71,168 $76,507 $45,844 
Non-GAAP Operating Profit19.0 %20.6 %14.5 %
Operating Expense Reconciliation
GAAP Operating Expenses$142,133 $140,249 $141,594 
Amortization of acquisition intangibles(1,972)(1,973)(2,170)
Stock-based compensation expense - R&D(15,763)(15,483)(15,952)
Stock-based compensation expense - SG&A(5,356)(6,313)(6,478)
Lease impairment1,019 — — 
Acquisition-related costs— — (3,166)
Non-GAAP Operating Expenses$118,023 $116,480 $113,828 
Gross Margin/Profit Reconciliation
GAAP Gross Profit$188,925 $192,625 $159,387 
GAAP Gross Margin50.5 %51.8 %50.3 %
Stock-based compensation expense - COGS266 362 285 
Non-GAAP Gross Profit$189,191 $192,987 $159,672 
Non-GAAP Gross Margin50.6 %51.9 %50.4 %
GAAP Tax Expense$14,508 $14,816 $7,170 
GAAP Effective Tax Rate25.6 %24.8 %31.5 %
Adjustments to income taxes4,105 (75)5,628 
Non-GAAP Tax Expense$18,613 $14,741 $12,798 
Non-GAAP Effective Tax Rate23.0 %17.6 %25.2 %
Tax Impact to EPS Reconciliation
GAAP Tax Expense $0.26 $0.27 $0.13 
Adjustments to income taxes0.07 — 0.10 
Non-GAAP Tax Expense$0.33 $0.27 $0.23 
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CONSOLIDATED CONDENSED BALANCE SHEET
 (in thousands; unaudited)
Jun. 29,Mar. 30,Jun. 24,
202420242023
ASSETS
Current assets
Cash and cash equivalents$491,351 $502,764 $352,346 
Marketable securities25,680 23,778 35,765 
Accounts receivable, net190,079 162,478 186,033 
Inventories232,566 227,248 300,956 
Prepaid wafers84,700 86,679 84,739 
Other current assets77,365 103,245 88,829 
Total current Assets1,101,741 1,106,192 1,048,668 
Long-term marketable securities227,527 173,374 38,029 
Right-of-use lease assets136,295 138,288 125,538 
Property and equipment, net170,953 170,175 167,238 
Intangibles, net27,624 29,578 36,447 
Goodwill435,936 435,936 435,936 
Deferred tax asset54,622 48,649 44,991 
Long-term prepaid wafers50,375 60,750 110,262 
Other assets60,552 68,634 49,483 
 Total assets$2,265,625 $2,231,576 $2,056,592 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable$77,562 $55,545 $75,941 
Accrued salaries and benefits41,101 47,612 36,465 
Lease liability22,058 20,640 19,903 
Acquisition-related liabilities— — 24,527 
Other accrued liabilities61,021 62,596 46,018 
Total current liabilities201,742 186,393 202,854 
Non-current lease liability132,016 134,576 125,071 
Non-current income taxes52,704 52,013 59,587 
Other long-term liabilities31,533 41,580 12,286 
Total long-term liabilities216,253 228,169 196,944 
Stockholders' equity:
Capital stock1,792,283 1,760,701 1,693,420 
Accumulated earnings (deficit)58,591 58,916 (33,621)
Accumulated other comprehensive loss(3,244)(2,603)(3,005)
Total stockholders' equity1,847,630 1,817,014 1,656,794 
Total liabilities and stockholders' equity$2,265,625 $2,231,576 $2,056,592 
    
Prepared in accordance with Generally Accepted Accounting Principles


6




CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
(in thousands; unaudited)
Three Months Ended
Jun. 29,Jun. 24,
20242023
Q1'25Q1'24
Cash flows from operating activities:
Net income$42,095 $15,600 
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization12,359 11,941 
Stock-based compensation expense21,385 22,715 
Deferred income taxes(5,897)(9,411)
Loss on retirement or write-off of long-lived assets— 6 
Other non-cash charges1,104 1,334 
Net change in operating assets and liabilities:
Accounts receivable, net(27,601)(35,560)
Inventories(5,318)(67,506)
Prepaid wafers12,354 — 
Other assets(5,459)8,101 
Accounts payable and other accrued liabilities12,037 (10,278)
Income taxes payable30,102 20,079 
Acquisition-related liabilities— 3,166 
Net cash provided by (used in) operating activities87,161 (39,813)
Cash flows from investing activities:
Maturities and sales of available-for-sale marketable securities12,646 11,048 
Purchases of available-for-sale marketable securities(69,060)(13,372)
Purchases of property, equipment and software(9,990)(12,310)
Investments in technology(155)— 
Net cash used in investing activities(66,559)(14,634)
Cash flows from financing activities:
Net proceeds from the issuance of common stock
10,196 560 
Repurchase of stock to satisfy employee tax withholding obligations(1,219)(1,047)
Repurchase and retirement of common stock(40,992)(38,504)
Net cash used in financing activities(32,015)(38,991)
Net decrease in cash and cash equivalents(11,413)(93,438)
Cash and cash equivalents at beginning of period502,764 445,784 
Cash and cash equivalents at end of period$491,351 $352,346 
Prepared in accordance with Generally Accepted Accounting Principles
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RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL INFORMATION
(in thousands; unaudited)
Free cash flow, a non-GAAP financial measure, is GAAP cash flow from operations (or cash provided by operating activities) less capital expenditures. Capital expenditures include purchases of property, equipment and software as well as investments in technology, as presented within our GAAP Consolidated Condensed Statement of Cash Flows. Free cash flow margin represents free cash flow divided by revenue.
Twelve Months EndedThree Months Ended
Jun. 29,Jun. 29,Mar. 30,Dec. 30,Sep. 23,
20242024202420232023
Q1'25Q1'25Q4'24Q3'24Q2'24
Net cash provided by (used in) operating activities (GAAP)$548,648 $87,161 $170,526 $313,692 $(22,731)
Capital expenditures(36,180)(10,145)(7,695)(9,813)(8,527)
Free Cash Flow (Non-GAAP)$512,468 $77,016 $162,831 $303,879 $(31,258)
Cash Flow from Operations as a Percentage of Revenue (GAAP)30 %23 %46 %51 %(5)%
Capital Expenditures as a Percentage of Revenue (GAAP)2 %3 %2 %2 %2 %
Free Cash Flow Margin (Non-GAAP)28 %21 %44 %49 %(6)%

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RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL INFORMATION
(in millions; unaudited)
(not prepared in accordance with GAAP)
Q2 FY25
Guidance
Operating Expense Reconciliation
GAAP Operating Expenses$149 - 155
Stock-based compensation expense(22)
Amortization of acquisition intangibles(2)
Non-GAAP Operating Expenses$125 - 131
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Exhibit 99.2




Q1 FY25
Letter to Shareholders
August 6, 2024
image.jpg

August 6, 2024
Dear Shareholders,
In Q1 FY25, Cirrus Logic delivered revenue of $374.0 million, up 18% year over year. Revenue was above the top end of our guidance range due to stronger-than-expected shipments into smartphones. GAAP and non-GAAP operating profit were 12.5 percent and 19.0 percent, respectively, while GAAP and non-GAAP earnings per share were $0.76 and $1.12, respectively.
During the quarter, we started ramping production of our new custom boosted amplifier and our first 22-nanometer smart codec ahead of new smartphone launches that are expected in the fall. Additionally, we were pleased with the progress we made on our strategy to diversify into new markets. We saw positive design momentum with laptops and began the development of next-generation components that will broaden our product portfolio in this market. We also introduced the latest in a series of next-generation data converters that we expect to drive growth in professional audio, consumer, and industrial applications. Looking forward, we are optimistic about the opportunities ahead of us as we continue to leverage our mixed-signal processing expertise to diversify our product portfolio and expand our addressable market in new application areas.
Figure A: Cirrus Logic Q1 FY25
Q1 FY25GAAPAdj.Non-GAAP*
Revenue$374.0$374.0
Gross Profit$188.9$0.3$189.2
Gross Margin50.5%50.6%
Operating Expense$142.1($24.1)$118.0
Operating Income$46.8$24.4$71.2
Operating Profit12.5%19.0%
Interest Income$8.2$8.2
Other Income$1.6$1.6
Income Tax Expense$14.5$4.1$18.6
Net Income$42.1$20.3$62.4
Diluted EPS$0.76$0.36$1.12
*Complete GAAP to Non-GAAP reconciliations available on page 10
Numbers may not sum due to rounding
$ millions, except EPS
Revenue and Gross Margin
Revenue for the June quarter was $374.0 million, up one percent quarter over quarter and up 18 percent year over year. Q1 FY25 revenue was above the top end of our guidance range due to stronger-than-expected shipments into smartphones. The year-over-year increase in sales was driven by an increase in smartphone unit volumes and high-performance mixed-signal (HPMS) content gains. This was partially offset by lower general market sales. In the September quarter, we expect revenue to range from $490 million to $550 million, up 39 percent sequentially and up eight percent year over year at the midpoint. When comparing our September quarter outlook to the equivalent quarter last year, we would note that in FY25 our September quarter begins and ends one week later. Thus, it encompasses one week more of the higher-volume production associated with typical seasonal product ramps.
Q1 FY25 Letter to Shareholders
2

In Q1 FY25, revenue derived from our audio and HPMS product lines represented 59 percent and 41 percent of total revenue, respectively. One customer contributed approximately 88 percent of total revenue in Q1 FY25. Our relationship with our largest customer remains outstanding, with continued strong design activity across a wide range of products. While we understand there is intense interest in this customer, in accordance with our policy, we do not discuss specifics about this business.
Figure B: Cirrus Logic Revenue ($M) Q2 FY23 to Q2 FY25
chart-1cd90b8d9b1e41b8988.jpg
*Midpoint of guidance as of August 6, 2024
GAAP gross margin in the June quarter was 50.5 percent, compared to 51.8 percent in Q4 FY24 and 50.3 percent in Q1 FY24. Non-GAAP gross margin in the June quarter was 50.6 percent, compared to 51.9 percent in Q4 FY24 and 50.4 percent in Q1 FY24. On a sequential basis, the 130-basis point decrease was mostly driven by higher supply chain costs largely related to new product ramps. In the September quarter, we expect gross margin to range from 50 percent to 52 percent.
Operating Profit, Tax, and EPS
Operating profit for Q1 FY25 was 12.5 percent on a GAAP basis and 19.0 percent on a non-GAAP basis. GAAP operating expense was $142.1 million and included $21.1 million in stock-based compensation, $2.0 million in amortization of acquisition intangibles, and $1.0 million in lease impairment. On a sequential basis, GAAP operating expense increased by $1.9 million primarily due to an increase in employee-related expenses and a lease impairment, offset by lower product development costs. On a year-over-year basis, GAAP operating expense increased by $0.5 million largely due to higher variable compensation, offset by lower acquisition-related costs. Non-GAAP operating expense for the quarter
Q1 FY25 Letter to Shareholders
3

was $118.0 million, up $1.5 million sequentially and $4.2 million year over year. The company’s total headcount exiting Q1 was 1,651.
Combined GAAP R&D and SG&A expenses for Q2 FY25 are expected to range from $149 million to $155 million, including approximately $22 million in stock-based compensation expense and $2 million in amortization of acquisition intangibles, resulting in a non-GAAP operating expense range between $125 million and $131 million.
Figure C: GAAP R&D and SG&A Expenses ($M)/Headcount Q2 FY23 to Q2 FY25
chart-f1bcf45db3ca43a6ace.jpg
*Reflects midpoint of combined R&D and SG&A guidance as of August 6, 2024
For the June quarter, GAAP tax expense was $14.5 million on GAAP pre-tax income of $56.6 million, resulting in an effective tax rate of 25.6 percent. Non-GAAP tax expense for the quarter was $18.6 million on non-GAAP pre-tax income of $81.0 million, resulting in a non-GAAP effective tax rate of 23.0 percent. The GAAP and non-GAAP effective tax rates for the June quarter were unfavorably impacted by a provision of the Tax Cuts and Jobs Act of 2017 that requires companies to capitalize and amortize R&D expenses rather than deduct them in the current year. We continue to anticipate that the impact of capitalized R&D will become less pronounced as additional years of R&D expenses are amortized. We estimate that our FY25 non-GAAP effective tax rate will range from approximately 22 percent to 24 percent.
GAAP earnings per share for the June quarter was $0.76, compared to earnings per share of $0.81 the prior quarter and $0.28 in Q1 FY24. Non-GAAP earnings per share for the June quarter was $1.12, versus $1.24 in Q4 FY24 and $0.67 in Q1 FY24.

Q1 FY25 Letter to Shareholders
4

Balance Sheet
Our cash and investment balance at the end of Q1 FY25 was $744.6 million, up from $699.9 million the prior quarter and $426.1 million in Q1 FY24. Cash flow from operations for the June quarter was $87.2 million. During the quarter, we repurchased 361,218 shares at an average price of $113.48, returning $41.0 million of cash to shareholders in the form of buybacks. At the end of Q1 FY25, the company had $274.1 million remaining in its share repurchase authorization. Over the long term, we expect strong cash flow generation, and we will continue to evaluate potential uses of this cash, including investing in the business to pursue organic growth opportunities, M&A, and returning capital to shareholders through share repurchases.
Q1 FY25 inventory was $232.6 million, up from $227.2 million in Q4 FY24. In Q2 FY25, we expect inventory to increase from the prior quarter in support of new smartphone launches expected this fall.
Company Strategy
We remain committed to our three-pronged strategy for growing our business: first, maintaining our leadership position in smartphone audio; second, increasing HPMS content in smartphones; and third, leveraging our strength in audio and HPMS to expand into additional applications and markets with both existing and new components.
Audio in Smartphones
In smartphone audio, customer engagement and development activities were robust in the June quarter. We recently began ramping production of our next-generation custom boosted amplifier and our first 22-nanometer smart codec ahead of new product launches later this year. These new components will deliver significant performance improvements over prior generations, enabling our customer to build more compelling and power-efficient devices for users while also saving vital board space. Over the past six years, the current generation of this amplifier and codec have shipped over three and a half billion and one billion units, respectively. Similarly, we anticipate these new components will ship for multiple smartphone generations once launched, providing sustained revenue contribution. During the quarter, we also engaged with Android customers on next-generation flagship smartphones with our general market audio components, and although the majority of our general market R&D resources are focused on developing products for new markets, we expect new flagship smartphones utilizing our components to come to market in the second half of the calendar year.
HPMS in Smartphones
Beyond audio, we are excited about the opportunities to grow our smartphone content with HPMS solutions. Engagement with our largest customer on camera controllers remains strong, and the features they help to enable have been very well received. With new product introductions later this year, we expect to benefit from a more favorable mix of smartphones on the market that include our third-generation camera controller. While our close engineering collaboration has spanned multiple generations of camera controllers, we continue to work on strengthening this relationship and identifying opportunities to enhance system performance and help enable advanced camera functionality.
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Furthermore, we are investing in new product development for power and battery technologies, which we view as the largest greenfield opportunity within the HPMS category. Our teams are focused on maximizing power efficiency for various subsystems in battery-powered devices by implementing advanced converter topologies that integrate digital control and mixed-signal techniques. We anticipate that the investments that we are making in this space today will contribute to product diversification and expand our footprint in this product category in the future.
Expanding Audio and HPMS into New Applications and Markets
Outside of smartphones, we remain focused on leveraging our intellectual property in other applications and markets. We have seen positive design momentum in laptops as they seek to become thinner, lighter, and more power-efficient, making our technology increasingly relevant. We are encouraged by the positive feedback we have received on our audio codec, boosted amplifier, haptic driver, and power converter, and we expect more end products utilizing our components to come to market over the next year. Moreover, we have begun the development of next-generation amplifiers and codecs that are expected to broaden our portfolio and address a wider range of the laptop market as customers seek to optimize performance across tiers and retail price points. We believe there are meaningful opportunities for Cirrus Logic to increase content per laptop as well as expanding our overall market share in the coming years.
While we expect laptops to be the largest near-term opportunity outside of smartphones, we also continue to make progress with our general market business where we service the professional audio, consumer, and industrial applications. Following the launch of our latest generation of analog-to-digital converters (ADCs) last year, we recently introduced a series of new digital-to-analog converters (DACs) and an ultra-high-performance audio codec in this product family. These products deliver exceptional performance and innovative features like hybrid gain control while requiring lower power compared to previous generations. We are currently sampling these components and are excited about the initial design-in phase with customers. Furthermore, we continue to engage OEMs that are seeking higher-quality sound and haptic feedback in AR/VR headsets, gaming devices, and wearables, and anticipate new devices utilizing our components to be introduced over the next year. Looking forward, we plan to continue to leverage our mixed-signal design and advanced low-power signal processing expertise to execute on our strategic vision and capitalize on growth opportunities in new applications and markets.
Summary and Guidance
For the September quarter we expect the following results:
•Revenue to range between $490 million and $550 million;
•GAAP gross margin to be between 50 percent and 52 percent; and
•Combined GAAP R&D and SG&A expenses to range between $149 million and $155 million, including approximately $22 million in stock-based compensation expense and $2 million in amortization of acquisition intangibles, resulting in a non-GAAP operating expense range between $125 million and $131 million.
In conclusion, in addition to delivering outstanding results in the June quarter, we began ramping our next-generation custom audio components, saw positive design momentum in laptops, and introduced new general market products. We continue to execute on our strategy to drive end-market diversification
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6

and product expansion through our HPMS solutions. With a deep commitment to innovation and an exciting roadmap, we believe Cirrus Logic is well-positioned to grow long-term shareholder value.
Sincerely,
image1.jpg
John Forsyth
President &
Chief Executive Officer
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Ulf Habermann
Interim Chief Financial Officer

Conference Call Q&A Session
Cirrus Logic will host a live Q&A session at 5 p.m. EDT today to answer questions related to its financial results and business outlook. Participants may listen to the conference call on the Cirrus Logic website.
A replay of the webcast can be accessed on the Cirrus Logic website approximately two hours following its completion or by calling (609) 800-9909 or toll-free at (800) 770-2030 (Access Code: 95424)
Use of Non-GAAP Financial Information
To supplement Cirrus Logic's financial statements presented on a GAAP basis, Cirrus has provided non-GAAP financial information, including non-GAAP net income, diluted earnings per share, operating income and profit, operating expenses, gross margin and profit, tax expense, tax expense impact on earnings per share, effective tax rate, free cash flow, and free cash flow margin. A reconciliation of the adjustments to GAAP results is included in the tables below. We are also providing guidance on our expected non-GAAP expected effective tax rate. We are not able to provide guidance on our GAAP effective tax rate or a related reconciliation without unreasonable efforts since our future GAAP effective tax rate depends on our future stock price and related stock-based compensation information that is not currently available.
Non-GAAP financial information is not meant as a substitute for GAAP results but is included because management believes such information is useful to our investors for informational and comparative purposes. In addition, certain non-GAAP financial information is used internally by management to evaluate and manage the company. The non-GAAP financial information used by Cirrus Logic may differ from that used by other companies. These non-GAAP measures should be considered in addition to, and not as a substitute for, the results prepared in accordance with GAAP.
Safe Harbor Statement
Except for historical information contained herein, the matters set forth in this shareholder letter contain forward-looking statements, including statements about our expectation that a new smartphone utilizing our new custom boosted amplifier and our first 22-nanometer smart codec will launch in the fall; our
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7

ability to develop next-generation components that will broaden our product portfolio for the laptop market; our expectation that our next generation data converters will drive growth in professional audio, consumer, and industrial applications; our ability to leverage our mixed-signal processing expertise to diversify our product portfolio and expand our addressable market in new application areas; our expectations for strong free cash flow generation over the long term; our ability to maintain our leadership position in smartphone audio; our ability to increase HPMS content in smartphones; our ability to leverage our strength in audio and HPMS to expand into additional applications and markets with both new and existing components; our expectation that our new custom boosted amplifier and our first 22-nanometer smart code will ship for multiple smartphone generations and provide sustained revenue contribution; our expectation that new Android flagship smartphones utilizing our components will come to market in the second half of the calendar year; our expectation that we will benefit from a more favorable mix of smartphones on the market that include our third-generation camera controller; our belief that the investments we are making in the power and battery space will contribute to product diversification and expand our footprint in this product category in the future; our expectation that more end products utilizing our components will come to market over the next year; our belief that there are meaningful opportunities to increase both content per laptop and market share in the coming years; our belief that we are well-positioned to grow long-term shareholder value; our non-GAAP effective tax rate for the full fiscal year 2025; our expectation that the impact of this capitalized R&D will become less pronounced as additional years of R&D expenses are amortized for tax purposes; and our forecasts for the second quarter of fiscal year 2025 revenue, gross margin, combined research and development and selling, general and administrative expense levels, stock-based compensation expense, amortization of acquisition intangibles, and inventory levels. In some cases, forward-looking statements are identified by words such as “emerge,” “expect,” “anticipate,” “foresee,” “target,” “project,” “believe,” “goals,” “opportunity,” “estimates,” “intend,” “will,” and variations of these types of words and similar expressions. In addition, any statements that refer to our plans, expectations, strategies, or other characterizations of future events or circumstances are forward-looking statements. 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, and readers should not place undue reliance on such statements. These risks and uncertainties include, but are not limited to, the following: the level and timing of orders and shipments during the second quarter of fiscal year 2025, customer cancellations of orders, or the failure to place orders consistent with forecasts; changes with respect to our current expectations of future smartphone unit volumes; any delays in the timing and/or success of customers’ new product ramps; and the risk factors listed in our Form 10-K for the year ended March 30, 2024 and in our other filings with the Securities and Exchange Commission, which are available at www.sec.gov. The foregoing information concerning our business outlook represents our outlook as of the date of this news release, and we expressly disclaim any obligation to update or revise any forward-looking statements, whether as a result of new developments or otherwise.
Cirrus Logic, Cirrus and the Cirrus Logic logo are registered trademarks of Cirrus Logic, Inc. All other company or product names noted herein may be trademarks of their respective holders.
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Summary of Financial Data Below:
CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
(in thousands, except per share data; unaudited)
Three Months Ended
Jun. 29,
2024		Mar. 30,
2024		Jun. 24,
2023
Q1'25Q4'24Q1'24
Audio$218,970 $226,681 $195,806 
High-Performance Mixed-Signal155,056 145,146 121,210 
Net sales374,026 371,827 317,016 
Cost of sales185,101 179,202 157,629 
Gross profit188,925 192,625 159,387 
Gross margin50.5 %51.8 %50.3 %
Research and development105,363 103,383 106,215 
Selling, general and administrative36,770 36,866 35,379 
Total operating expenses142,133 140,249 141,594 
Income from operations46,792 52,376 17,793 
Interest income8,202 7,360 4,600 
Other income (expense)1,609 (78)377 
Income before income taxes56,603 59,658 22,770 
Provision for income taxes14,508 14,816 7,170 
Net income $42,095 $44,842 $15,600 
Basic earnings per share$0.79 $0.83 $0.28 
Diluted earnings per share:$0.76 $0.81 $0.28 
Weighted average number of shares:
Basic53,433 53,739 54,862 
Diluted55,665 55,559 56,631 
Prepared in accordance with Generally Accepted Accounting Principles
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RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL INFORMATION
(in thousands, except per share data; unaudited)
(not prepared in accordance with GAAP)
Non-GAAP financial information is not meant as financial information is not meant as a substitute for GAAP results, but is included because management believes such information is useful to our investors for informational and comparative purposes. In addition, certain non-GAAP financial information is used internally by management to evaluate and manage the company. As a note, the non-GAAP financial information used by Cirrus Logic may differ from that used by other companies. These non-GAAP measures should be considered in addition to, and not as a substitute for, the results prepared in accordance with GAAP.

Three Months Ended
Jun. 29,
2024		Mar. 30,
2024		Jun. 24,
2023
Net Income ReconciliationQ1'25Q4'24Q1'24
GAAP Net Income$42,095 $44,842 $15,600 
Amortization of acquisition intangibles1,972 1,973 2,170 
Stock-based compensation expense21,385 22,158 22,715 
Lease impairment1,019 — — 
Acquisition-related costs— — 3,166 
Adjustment to income taxes(4,105)75 (5,628)
Non-GAAP Net Income$62,366 $69,048 $38,023 
Earnings Per Share Reconciliation
GAAP Diluted earnings per share$0.76 $0.81 $0.28 
Effect of Amortization of acquisition intangibles0.03 0.03 0.04 
Effect of Stock-based compensation expense0.38 0.40 0.40 
Effect of Lease impairment0.02 — — 
Effect of Acquisition-related costs— — 0.05 
Effect of Adjustment to income taxes(0.07)— (0.10)
Non-GAAP Diluted earnings per share$1.12 $1.24 $0.67 
Operating Income Reconciliation
GAAP Operating Income$46,792 $52,376 $17,793 
GAAP Operating Profit 12.5 %14.1 %5.6 %
Amortization of acquisition intangibles1,972 1,973 2,170 
Stock-based compensation expense - COGS266 362 285 
Stock-based compensation expense - R&D15,763 15,483 15,952 
Stock-based compensation expense - SG&A5,356 6,313 6,478 
Lease impairment1,019 — — 
Acquisition-related costs— — 3,166 
Non-GAAP Operating Income$71,168 $76,507 $45,844 
Non-GAAP Operating Profit19.0 %20.6 %14.5 %
Operating Expense Reconciliation
GAAP Operating Expenses$142,133 $140,249 $141,594 
Amortization of acquisition intangibles(1,972)(1,973)(2,170)
Stock-based compensation expense - R&D(15,763)(15,483)(15,952)
Stock-based compensation expense - SG&A(5,356)(6,313)(6,478)
Lease impairment(1,019)— — 
Acquisition-related costs— — (3,166)
Non-GAAP Operating Expenses$118,023 $116,480 $113,828 
Gross Margin/Profit Reconciliation
GAAP Gross Profit$188,925 $192,625 $159,387 
GAAP Gross Margin50.5 %51.8 %50.3 %
Stock-based compensation expense - COGS266 362 285 
Non-GAAP Gross Profit$189,191 $192,987 $159,672 
Non-GAAP Gross Margin50.6 %51.9 %50.4 %
Effective Tax Rate Reconciliation
GAAP Tax Expense$14,508 $14,816 $7,170 
GAAP Effective Tax Rate25.6 %24.8 %31.5 %
Adjustments to income taxes4,105 (75)5,628 
Non-GAAP Tax Expense$18,613 $14,741 $12,798 
Non-GAAP Effective Tax Rate23.0 %17.6 %25.2 %
Tax Impact to EPS Reconciliation
GAAP Tax Expense $0.26 $0.27 $0.13 
Adjustments to income taxes0.07 — 0.10 
Non-GAAP Tax Expense$0.33 $0.27 $0.23 

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10

CONSOLIDATED CONDENSED BALANCE SHEET
(in thousands; unaudited)
Jun. 29,
2024		Mar. 30,
2024		Jun. 24,
2023
ASSETS
Current assets
Cash and cash equivalents$491,351 $502,764 $352,346 
Marketable securities25,680 23,778 35,765 
Accounts receivable, net190,079 162,478 186,033 
Inventories232,566 227,248 300,956 
Prepaid wafers84,700 86,679 84,739 
Other current assets77,365 103,245 88,829 
Total current Assets1,101,741 1,106,192 1,048,668 
Long-term marketable securities227,527 173,374 38,029 
Right-of-use lease assets136,295 138,288 125,538 
Property and equipment, net170,953 170,175 167,238 
Intangibles, net27,624 29,578 36,447 
Goodwill435,936 435,936 435,936 
Deferred tax asset54,622 48,649 44,991 
Long-term prepaid wafers50,375 60,750 110,262 
Other assets60,552 68,634 49,483 
Total assets$2,265,625 $2,231,576 $2,056,592 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable$77,562 $55,545 $75,941 
Accrued salaries and benefits41,101 47,612 36,465 
Lease liability22,058 20,640 19,903 
Acquisition-related liabilities— — 24,527 
Other accrued liabilities61,021 62,596 46,018 
Total current liabilities201,742 186,393 202,854 
Non-current lease liability132,016 134,576 125,071 
Non-current income taxes52,704 52,013 59,587 
Other long-term liabilities31,533 41,580 12,286 
Total long-term liabilities216,253 228,169 196,944 
Stockholders' equity:
Capital stock1,792,283 1,760,701 1,693,420 
Accumulated earnings (deficit)58,591 58,916 (33,621)
Accumulated other comprehensive loss(3,244)(2,603)(3,005)
Total stockholders' equity1,847,630 1,817,014 1,656,794 
Total liabilities and stockholders' equity$2,265,625 $2,231,576 $2,056,592 
Prepared in accordance with Generally Accepted Accounting Principles
Q1 FY25 Letter to Shareholders
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CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
(in thousands; unaudited)
Three Months Ended
Jun. 29,Jun. 24,
20242023
Q1'25Q1'24
Cash flows from operating activities:
Net income$42,095 $15,600 
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization12,359 11,941 
Stock-based compensation expense21,385 22,715 
Deferred income taxes(5,897)(9,411)
Loss on retirement or write-off of long-lived assets— 6 
Other non-cash charges1,104 1,334 
Net change in operating assets and liabilities:
Accounts receivable, net(27,601)(35,560)
Inventories(5,318)(67,506)
Prepaid wafers12,354 — 
Other assets(5,459)8,101 
Accounts payable and other accrued liabilities12,037 (10,278)
Income taxes payable30,102 20,079 
Acquisition-related liabilities— 3,166 
Net cash provided by (used in) operating activities87,161 (39,813)
Cash flows from investing activities:
Maturities and sales of available-for-sale marketable securities12,646 11,048 
Purchases of available-for-sale marketable securities(69,060)(13,372)
Purchases of property, equipment and software(9,990)(12,310)
Investments in technology(155)— 
Net cash used in investing activities(66,559)(14,634)
Cash flows from financing activities:
Net proceeds from the issuance of common stock10,196 560 
Repurchase of stock to satisfy employee tax withholding obligations(1,219)(1,047)
Repurchase and retirement of common stock(40,992)(38,504)
Net cash used in financing activities(32,015)(38,991)
Net decrease in cash and cash equivalents(11,413)(93,438)
Cash and cash equivalents at beginning of period502,764 445,784 
Cash and cash equivalents at end of period$491,351 $352,346 
Prepared in accordance with Generally Accepted Accounting Principles
Q1 FY25 Letter to Shareholders
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RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL INFORMATION
(in thousands; unaudited)
Free cash flow, a non-GAAP financial measure, is GAAP cash flow from operations (or cash provided by operating activities) less capital expenditures. Capital expenditures include purchases of property, equipment and software as well as investments in technology, as presented within our GAAP Consolidated Condensed Statement of Cash Flows. Free cash flow margin represents free cash flow divided by revenue.
Twelve Months EndedThree Months Ended
Jun. 29,Jun. 29,Mar. 30,Dec. 30,Sep. 23,
20242024202420232023
Q1'25Q1'25Q4'24Q3'24Q2'24
Net cash provided by (used in) operating activities (GAAP)$548,648 $87,161 $170,526 $313,692 $(22,731)
Capital expenditures(36,180)(10,145)(7,695)(9,813)(8,527)
Free Cash Flow (Non-GAAP)$512,468 $77,016 $162,831 $303,879 $(31,258)
Cash Flow from Operations as a Percentage of Revenue (GAAP)30 %23 %46 %51 %(5)%
Capital Expenditures as a Percentage of Revenue (GAAP)2 %3 %2 %2 %2 %
Free Cash Flow Margin (Non-GAAP)28 %21 %44 %49 %(6)%
Q1 FY25 Letter to Shareholders
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RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL INFORMATION
(in millions; unaudited)
(not prepared in accordance with GAAP)
Q2 FY25
Guidance
Operating Expense Reconciliation
GAAP Operating Expenses$149 - 155
Stock-based compensation expense(22)
Amortization of acquisition intangibles(2)
Non-GAAP Operating Expenses$125 - 131
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v3.24.2.u1
Cover Page
Aug. 06, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Aug. 06, 2024
Entity File Number 000-17795
Entity Registrant Name CIRRUS LOGIC, INC.
Entity Incorporation, State or Country Code DE
Entity Tax Identification Number 77-0024818
Entity Address, Address Line One 800 W. 6th Street
Entity Address, City or Town Austin,
Entity Address, State or Province TX
Entity Address, Postal Zip Code 78701
City Area Code (512)
Local Phone Number 851-4000
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common stock, $0.001 par value
Trading Symbol CRUS
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
Amendment Flag false
Entity Central Index Key 0000772406
Cirrus Logic (NASDAQ:CRUS)
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