Renesas Electronics (6723) Q4 2023 earnings summary

Executive summary

• FY2023 IFRS revenue was ¥1,469.4bn, down 2.1% YoY; operating profit was ¥390.8bn, down 7.9%, and net profit attributable to owners was ¥337.1bn, up 31.4%.

• Non-GAAP revenue was ¥1,469.7bn, down 2.2%; operating profit was ¥501.6bn, down 10.3%, with a 34.1% margin, down 3.1pts.

• Automotive growth offset weaker Industrial / Infrastructure / IoT demand, particularly in PC/mobile and consumer electronics.

Financial highlights

• 4Q non-GAAP revenue was ¥361.9bn, down 7.5% YoY and 4.6% QoQ; gross margin was 56.4% and operating margin was 31.9%.

• 4Q non-GAAP operating profit was ¥115.5bn; profit attributable to owners was ¥98.2bn and EBITDA was ¥136.0bn.

• FY2023 non-GAAP gross profit was ¥837.4bn, with a 57.0% margin; non-GAAP EBITDA was ¥581.9bn, versus IFRS EBITDA of ¥576.8bn.

• IFRS gross profit was ¥834.3bn, with a 56.8% margin; profit before tax rose to ¥422.2bn from ¥362.3bn.

• Basic EPS was ¥189.77 versus ¥137.66; diluted EPS was ¥186.07 versus ¥134.84.

Outlook and guidance

• Q1 2024 non-GAAP revenue forecast was ¥337.5bn–¥352.5bn, with a ¥345.0bn midpoint; gross and operating margin forecasts were 55.0% and 30.0%, based on the midpoint.

• The revenue midpoint was forecast down 4.1% YoY and 4.7% QoQ; gross margin was forecast down 1.2pts YoY and 1.4pts QoQ.

• Forecast exchange rates were ¥142/USD and ¥155/EUR; Q1 plans included increased production response and higher die-bank inventory, with differing channel-inventory outlooks by segment.