Forward-Looking Statements
This press release contains forward-looking statements that are based on current expectations, estimates, forecasts and projections of future performance based on management's judgment, beliefs, current trends, and anticipated product performance. These forward-looking statements include, without limitation, statements relating to projected amount of revenue, gross margin, operating income (loss), income tax expenses, net income (loss), noncontrolling interest, and share-based compensation expenses, our ability and strategy to develop new products, expand our sales, and achieve sustained growth and profitability, and other information under the section entitled “Business Outlook for Fiscal Q4 Ending June 30, 2017”. Forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking statements. These factors include, but are not limited to, the decline of the PC industry and our ability to respond to such decline, our ability to introduce or develop new and enhanced products that achieve market acceptance, the actual product performance in volume production, the quality and reliability of our product, our ability to achieve design wins, the general business and economic conditions, the state of semiconductor industry and seasonality of our markets, our ability to maintain factory utilization at a desirable level, our ability to successfully operate our joint venture in China, and other risks as described in our SEC filings, including our Annual Report on Form 10-K for the fiscal year ended June 30, 2016 filed on August 26, 2016. Other unknown or unpredictable factors or underlying assumptions subsequently proving to be incorrect could cause actual results to differ materially from those in the forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance, or achievements. You should not place undue reliance on these forward-looking statements. All information provided in this press release is as of today's date, unless otherwise stated, and AOS undertakes no duty to update such information, except as required under applicable law.
Use of Non-GAAP Financial Measures
To supplement our unaudited consolidated financial statements presented on a basis consistent with U.S. GAAP, we disclose certain non-GAAP financial measures, including non-GAAP gross profit, gross margin, operating income (loss), net income (loss) and diluted earnings per share ("EPS"). These supplemental measures exclude share-based compensation expenses for all periods presented in this press release and impairment of long-lived assets for the nine months ended March 31, 2016. We believe that non-GAAP financial measures can provide useful information to both management and investors by excluding certain expenses that are not indicative of our core operating results. In addition, our management uses non-GAAP measures to compare our performance relative to forecasts and to benchmark our performance externally against competitors. Our use of non-GAAP financial measures has certain limitations in that the non-GAAP financial measures we use may not be directly comparable to those reported by other companies. For example, the term used in this press release, non-GAAP net income (loss), does not have a standardized meaning. Other companies may use the same or similarly named measures, but exclude different items, which may not provide investors with a comparable view of our performance in relation to other companies. In addition, different items may be excluded in non-GAAP measures presented in different periods. We seek to compensate for the limitation of our non-GAAP presentation by providing a detailed reconciliation of the non-GAAP financial measures to the most directly comparable U.S. GAAP measures in the tables attached to this press release. Investors are encouraged to review the related U.S. GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable U.S. GAAP financial measures.
About Alpha and Omega Semiconductor
Alpha and Omega Semiconductor Limited, or AOS, is a designer, developer and global supplier of a broad range of power semiconductors, including a wide portfolio of Power MOSFET, IGBT and Power IC products. AOS has developed extensive intellectual property and technical knowledge that encompasses the latest advancements in the power semiconductor industry, which enables it to introduce innovative products to address the increasingly complex power requirements of advanced electronics. AOS differentiates itself by integrating its Discrete and IC semiconductor process technology, product design, and advanced packaging know-how to develop high performance power management solutions. AOS's portfolio of products targets high-volume applications, including portable computers, flat panel TVs, LED lighting, smart phones, battery packs, consumer and industrial motor controls and power supplies for TVs, computers, servers and telecommunications equipment. For more information, please visit http://www.aosmd.com. For investor relations, please contact So-Yeon Jeong at investors@aosmd.com.
The following unaudited consolidated financial statements are prepared in accordance with U.S. GAAP.
| Alpha and Omega Semiconductor Limited | |||||||||||||||||||
| Condensed Consolidated Statements of Operations | |||||||||||||||||||
| (in thousands, except percentages and per share amounts) | |||||||||||||||||||
| (unaudited) | |||||||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||||||
|
March 31,
2017 |
December 31,
2016 |
March 31,
2016 |
March 31,
2017 |
March 31,
2016 | |||||||||||||||
| Revenue | $ | 93,281 | $ | 94,687 | $ | 82,987 | $ | 285,330 | $ | 244,251 | |||||||||
| Cost of goods sold | 70,584 | 72,593 | 66,668 | 218,595 | 197,899 | ||||||||||||||
| Gross profit | 22,697 | 22,094 | 16,319 | 66,735 | 46,352 | ||||||||||||||
| Gross margin | 24.3 | % | 23.3 | % | 19.7 | % | 23.4 | % | 19.0 | % | |||||||||
| Operating expenses: | |||||||||||||||||||
| Research and development | 7,625 | 7,284 | 6,924 | 21,928 | 19,029 | ||||||||||||||
| Selling, general and administrative | 12,067 | 11,974 | 9,566 | 35,224 | 27,935 | ||||||||||||||
| Impairment of long-lived assets | — | — | — | — | 432 | ||||||||||||||
| Total operating expenses | 19,692 | 19,258 | 16,490 | 57,152 | 47,396 | ||||||||||||||
| Operating income (loss) | 3,005 | 2,836 | (171 | ) | 9,583 | (1,044 | ) | ||||||||||||
| Interest income and other income (loss), net | (74 | ) | (70 | ) | 132 | (193 | ) | (335 | ) | ||||||||||
| Interest expense | (22 | ) | (24 | ) | (5 | ) | (72 | ) | (22 | ) | |||||||||
| Income (loss) before income taxes | 2,909 | 2,742 | (44 | ) | 9,318 | (1,401 | ) | ||||||||||||
| Income tax expense | 523 | 1,085 | 1,219 | 2,845 | 3,448 | ||||||||||||||
| Net income (loss) including noncontrolling interest | 2,386 | 1,657 | (1,263 | ) | 6,473 | (4,849 | ) | ||||||||||||
| Net loss attributable to noncontrolling interest | (1,170 | ) | (1,190 | ) | — | (3,237 | ) | — | |||||||||||
| Net income (loss) attributable to Alpha and Omega Semiconductor Limited | $ | 3,556 | $ | 2,847 | $ | (1,263 | ) | $ | 9,710 | $ | (4,849 | ) | |||||||
| Net income (loss) per common share attributable to Alpha and Omega Semiconductor Limited | |||||||||||||||||||
| Basic | $ | 0.15 | $ | 0.12 | $ | (0.06 | ) | $ | 0.42 | $ | (0.22 | ) | |||||||
| Diluted | $ | 0.14 | $ | 0.11 | $ | (0.06 | ) | $ | 0.39 | $ | (0.22 | ) | |||||||
| Weighted average number of common shares attributable to Alpha and Omega Semiconductor Limited used to compute net income (loss) per share | |||||||||||||||||||
| Basic | 23,675 | 23,481 | 22,232 | 23,396 | 22,400 | ||||||||||||||
| Diluted | 24,951 | 24,977 | 22,232 | 24,781 | 22,400 | ||||||||||||||
