Market Overview

Cypress Reports Second Quarter 2019 Results

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Cypress Semiconductor Corporation (NASDAQ:CY), today announced its second quarter 2019 results with the following highlights:

  • $532.2 million in revenue, down 1.3% sequentially, but up 4.8% sequentially after adjusting for the divestiture of our NAND business, which was completed on April 1, 2019
  • GAAP and Non-GAAP gross margins were 37.3% and 47.0%, respectively
  • GAAP and Non-GAAP diluted EPS were $(0.03) and $0.25, respectively

"We delivered a solid second quarter with revenue, gross margin, and diluted EPS all within our guidance ranges," said Hassane El-Khoury, Cypress' president and chief executive officer. "Cypress' world-class connect and compute solutions continue to gain strong momentum, including in IoT where Cypress' revenue was up 30% sequentially in Q2, driven by strength in Wi-Fi/Bluetooth combos as well as standalone Bluetooth. Cypress also continues to execute well in automotive where Cypress' revenue grew in Q2, both annually and sequentially, as our per-vehicle content continues to outgrow vehicle unit production levels."

As announced on June 3, 2019, Infineon Technologies AG ("Infineon") and Cypress have entered into an agreement and plan of merger providing for Infineon to acquire Cypress for $23.85 per share in cash, corresponding to an enterprise value of approximately $10 billion. The combination of our highly-complementary product portfolios opens up great potential in the high-growth areas of automotive and IoT. Due to the pending transaction, Cypress will not hold an earnings conference call and has suspended the practice of providing forward-looking guidance.

Revenue and earnings for the quarter are shown below with comparable periods:

(In thousands, except per-share data)

 

 

GAAP

 

NON-GAAP1

 

 

Q2 2019

 

Q1 2019

 

Q2 2018

 

Q2 2019

 

Q1 2019

 

Q2 2018

Revenue

 

$

532,221

 

 

$

539,004

 

 

$

624,090

 

 

$

532,221

 

 

$

539,004

 

 

$

624,090

 

Gross margin

 

37.3

%

 

37.6

%

 

37.5

%

 

47.0

%

 

47.4

%

 

46.3

%

Operating margin

 

2.5

%

 

5.9

%

 

8.1

%

 

20.4

%

 

21.1

%

 

22.3

%

Net (loss) income

 

$

(12,729

)

 

$

19,714

 

 

$

27,706

 

 

$

97,241

 

 

$

102,104

 

 

$

124,964

 

Diluted EPS

 

$

(0.03

)

 

$

0.05

 

 

$

0.07

 

 

$

0.25

 

 

$

0.27

 

 

$

0.33

 

Year-to-date revenue and earnings are shown below with comparable periods:

(In thousands, except per-share data)

 

 

GAAP

 

NON-GAAP1

 

 

Six Months

 

Six Months

 

 

Q2 2019

 

Q2 2018

 

Q2 2019

 

Q2 2018

Revenue

 

$

1,071,225

 

 

$

1,206,331

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