Monolithic Power Systems (MPWR) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue reached a record $507.4 million, up 15% year-over-year and 10.8% sequentially, driven by AI-powered solutions, improved order trends, and higher average selling prices.

• Net income for Q2 2024 was $100.4 million, nearly flat year-over-year, as higher revenue was offset by increased costs and expenses.

• The company is transforming from a chip supplier to a full solutions provider, with solution-based revenue now 20%-25% of total.

• Completed the acquisition of Axign B.V. in January 2024 for $33.4 million, expanding the audio IC portfolio.

• CEO highlighted a long-term growth strategy and continued investment in R&D.

Financial highlights

• Q2 2024 revenue: $507.4 million, up 15% year-over-year; six-month revenue: $965.3 million, up 8.2%.

• Q2 2024 net income: $100.4 million; six-month net income: $192.9 million.

• Q2 2024 GAAP EPS: $2.05; non-GAAP EPS: $3.17; six-month GAAP EPS: $3.94; non-GAAP EPS: $5.98.

• Q2 2024 GAAP gross margin: 55.3%, down from 56.1% a year ago; non-GAAP gross margin: 55.7%.

• Cash and short-term investments totaled $1.31 billion as of June 30, 2024.

Outlook and guidance

• Q3 2024 revenue expected between $590 million and $610 million, with continued growth in communications, storage, and computing.

• Q3 GAAP gross margin projected at 55.2%-55.8%; non-GAAP gross margin at 55.5%-56.1%.

• Management remains cautious due to macroeconomic uncertainty, including global downturns and geopolitical conflicts.

• Liquidity is expected to be sufficient for the next 12 months and beyond.

• Enterprise data segment growth rate is slowing after significant gains, but still expected to grow.