Power Integrations Reports Second-Quarter Financial Results

By: Power Integrations, Inc. via Business Wire

August 06, 2025 at 16:01 PM EDT

Revenues increased nine percent year-over-year to $115.9 million

Company repurchased 706 thousand shares during the quarter for $32.6 million

Power Integrations (NASDAQ: POWI) today announced financial results for the quarter ended June 30, 2025. Net revenues for the second quarter were $115.9 million, up ten percent compared to the prior quarter and up nine percent from the second quarter of 2024. GAAP net income for the second quarter was $1.4 million or $0.02 per diluted share compared to $0.15 per diluted share in the prior quarter and $0.09 per diluted share in the second quarter of 2024. Cash flow from operations for the quarter was $29.1 million.

In addition to its GAAP results, the company provided non-GAAP measures that exclude stock-based compensation, a charge stemming from litigation related to an employment matter, amortization of acquisition-related intangible assets and the related tax effects. Non-GAAP net income for the second quarter of 2025 was $19.9 million or $0.35 per diluted share compared to $0.31 per diluted share in the prior quarter and $0.28 per diluted share in the second quarter of 2024. A reconciliation of GAAP to non-GAAP financial results is included with the tables accompanying this press release.

Power Integrations CEO Jennifer Lloyd commented: “Revenues increased nine percent year-over-year driven by strong growth in the industrial category. While near-term visibility is low due to macroeconomic uncertainty, our long-term growth drivers are on track. Our automotive business continues to build toward a material revenue contribution in 2026. Revenues from GaN-based products grew more than 50 percent in the first half with adoption broadening into appliance, industrial and EV applications. Our 1250- and 1700-volt GaN technologies are well suited for the requirements of next-generation AI datacenters, and we are developing differentiated, system-level products to capitalize on that opportunity.”

Additional Highlights

The company repurchased 706 thousand shares during the quarter for $32.6 million; $42.4 million remained on its repurchase authorization at quarter-end.
Power Integrations paid a dividend of $0.21 per share on June 30, 2025. A dividend of $0.21 per share will be paid on September 30, 2025, to stockholders of record as of August 29, 2025.

Financial Outlook

The company issued the following forecast for the third quarter of 2025:

Revenues are expected to be in a range of $118 million plus or minus $5 million.
GAAP gross margin is expected to be between 54.5 percent and 55 percent, and non-GAAP gross margin is expected to be between 55 percent and 55.5 percent. The difference between GAAP and non-GAAP is attributable to stock-based compensation and, to a lesser extent, amortization of acquisition-related intangible assets.
GAAP operating expenses are expected to be approximately $72.5 million; non-GAAP operating expenses are expected to be approximately $47.5 million. Non-GAAP operating expenses are expected to exclude approximately $10 million of stock-based compensation and a net non-cash charge of approximately $15 million reflecting the immediate expensing of stock awards previously granted to the company’s former CEO. The grants will continue to vest according to their original terms, including performance criteria, under a consultancy agreement with the former CEO.

Conference Call Today at 1:30 p.m. Pacific Time

Power Integrations management will hold a conference call today at 1:30 p.m. Pacific time. A live webcast of the call will be available on the investor section of the company's website, http://investors.power.com. Members of the investment community can register for the conference call by visiting https://emportal.ink/4eCXH0R.

About Power Integrations

Power Integrations, Inc. is a leading innovator in semiconductor technologies for high-voltage power conversion. The company’s products are key building blocks in the clean-power ecosystem, enabling the generation of renewable energy as well as the efficient transmission and consumption of power in applications ranging from milliwatts to megawatts. For more information, please visit www.power.com.

Note Regarding Use of Non-GAAP Financial Measures

In addition to the company's consolidated financial statements, which are presented according to GAAP, the company provides certain non-GAAP financial information that excludes stock-based compensation expenses recorded under ASC 718-10, amortization of acquisition-related intangible assets, other operating expenses of $9.2 million stemming from an employment litigation matter and the tax effects of these items. The company uses these measures in its financial and operational decision-making and, with respect to one measure, in setting performance targets for compensation purposes. The company believes that these non-GAAP measures offer important analytical tools to help investors understand its operating results, and to facilitate comparability with the results of companies that provide similar measures. Non-GAAP measures have limitations as analytical tools and are not meant to be considered in isolation or as a substitute for GAAP financial information. For example, stock-based compensation is an important component of the company’s compensation mix and will continue to result in significant expenses in the company’s GAAP results for the foreseeable future but is not reflected in the non-GAAP measures. Also, other companies, including companies in Power Integrations’ industry, may calculate non-GAAP measures differently, limiting their usefulness as comparative measures. Reconciliations of non-GAAP measures to GAAP measures are attached to this press release.

Note Regarding Forward-Looking Statements

The above statements regarding the company’s forecast for its third-quarter financial performance are forward-looking statements reflecting management's current expectations and beliefs. These statements are based on current information that is, by its nature, subject to rapid and even abrupt change. Due to risks and uncertainties associated with the company's business, actual results could differ materially from those projected or implied by these statements. These risks and uncertainties include, but are not limited to: changes in trade policies, in particular the escalation and imposition of new and higher tariffs, which could reduce demand for end products that incorporate our integrated circuits and/or place pressure on our prices as our customers seek to offset the impact of increased tariffs on their own products; the company’s ability to supply products and its ability to conduct other aspects of its business such as competing for new design wins; changes in global economic and geopolitical conditions, including such factors as inflation, armed conflicts and trade negotiations, which may impact the level of demand for the company’s products; potential changes and shifts in customer demand away from end products that utilize the company's integrated circuits to end products that do not incorporate the company's products; the effects of competition, which may cause the company’s revenues to decrease or cause the company to decrease its selling prices for its products; unforeseen costs and expenses; and unfavorable fluctuations in component costs or operating expenses resulting from changes in commodity prices and/or exchange rates. In addition, new product introductions and design wins are subject to the risks and uncertainties that typically accompany development and delivery of complex technologies to the marketplace, including product development delays and defects and market acceptance of the new products. These and other risk factors that may cause actual results to differ are more fully explained under the caption “Risk Factors” in the company's most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 7, 2025. The company is under no obligation (and expressly disclaims any obligation) to update or alter its forward-looking statements, whether because of new information, future events or otherwise, except as otherwise required by law.

Power Integrations and the Power Integrations logo are trademarks or registered trademarks of Power Integrations, Inc. All other trademarks are property of their respective owners.

POWER INTEGRATIONS, INC.
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per-share amounts)


		Three Months Ended			Six Months Ended
		June 30, 2025	March 31, 2025	June 30, 2024	June 30, 2025	June 30, 2024
NET REVENUES		$ 115,852	$ 105,529	$ 106,198	$ 221,381	$ 197,886

COST OF REVENUES		51,898	47,294	49,665	99,192	93,573

GROSS PROFIT		63,954	58,235	56,533	122,189	104,313

OPERATING EXPENSES:
Research and development		25,991	24,095	26,047	50,086	49,272
Sales and marketing		18,349	16,375	18,053	34,724	33,775
General and administrative		11,808	11,047	10,475	22,855	18,838
Other operating expenses		9,151	-	-	9,151	-
	Total operating expenses	65,299	51,517	54,575	116,816	101,885

INCOME (LOSS) FROM OPERATIONS		(1,345)	6,718	1,958	5,373	2,428

OTHER INCOME		2,690	3,167	3,189	5,857	6,691

INCOME BEFORE INCOME TAXES		1,345	9,885	5,147	11,230	9,119

PROVISION (BENEFIT) FOR INCOME TAXES		(24)	1,095	298	1,071	316

NET INCOME		$ 1,369	$ 8,790	$ 4,849	$ 10,159	$ 8,803

EARNINGS PER SHARE:
	Basic	$ 0.02	$ 0.15	$ 0.09	$ 0.18	$ 0.15
	Diluted	$ 0.02	$ 0.15	$ 0.09	$ 0.18	$ 0.15

SHARES USED IN PER-SHARE CALCULATION:
	Basic	56,274	56,871	56,780	56,571	56,807
	Diluted	56,387	57,123	56,984	56,787	57,104



SUPPLEMENTAL INFORMATION:		Three Months Ended			Six Months Ended
		June 30, 2025	March 31, 2025	June 30, 2024	June 30, 2025	June 30, 2024
Stock-based compensation expenses included in:
	Cost of revenues	$ 592	$ 657	$ 707	$ 1,249	$ 1,053
	Research and development	3,190	2,250	3,885	5,440	6,310
	Sales and marketing	1,922	1,586	2,510	3,508	4,114
	General and administrative	4,373	4,190	3,933	8,563	5,972
	Total stock-based compensation expense	$ 10,077	$ 8,683	$ 11,035	$ 18,760	$ 17,449

Cost of revenues includes:
	Amortization of acquisition-related intangible assets	$ 146	$ 147	$ 258	$ 293	$ 740


		Three Months Ended			Six Months Ended
REVENUE MIX BY END MARKET		June 30, 2025	March 31, 2025	June 30, 2024	June 30, 2025	June 30, 2024
	Communications	11%	10%	11%	10%	11%
	Computer	12%	12%	14%	12%	13%
	Consumer	37%	44%	42%	41%	41%
	Industrial	40%	34%	33%	37%	35%

POWER INTEGRATIONS, INC.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO GAAP RESULTS
(in thousands, except per-share amounts)

			Three Months Ended									Six Months Ended
			June 30, 2025			March 31, 2025			June 30, 2024			June 30, 2025			June 30, 2024
RECONCILIATION OF GROSS PROFIT
GAAP gross profit			$	63,954		$	58,235		$	56,533		$	122,189		$	104,313
	GAAP gross margin			55.2	%		55.2	%		53.2	%		55.2	%		52.7	%

Stock-based compensation included in cost of revenues				592			657			707			1,249			1,053
Amortization of acquisition-related intangible assets				146			147			258			293			740

Non-GAAP gross profit			$	64,692		$	59,039		$	57,498		$	123,731		$	106,106
	Non-GAAP gross margin			55.8	%		55.9	%		54.1	%		55.9	%		53.6	%


			Three Months Ended									Six Months Ended
RECONCILIATION OF OPERATING EXPENSES			June 30, 2025			March 31, 2025			June 30, 2024			June 30, 2025			June 30, 2024
GAAP operating expenses			$	65,299		$	51,517		$	54,575		$	116,816		$	101,885

Less:	Stock-based compensation expense included in operating expenses
		Research and development		3,190			2,250			3,885			5,440			6,310
		Sales and marketing		1,922			1,586			2,510			3,508			4,114
		General and administrative		4,373			4,190			3,933			8,563			5,972
	Other operating expenses			9,151			-			-			9,151			-
		Total		18,636			8,026			10,328			26,662			16,396

Non-GAAP operating expenses			$	46,663		$	43,491		$	44,247		$	90,154		$	85,489


			Three Months Ended									Six Months Ended
RECONCILIATION OF INCOME FROM OPERATIONS			June 30, 2025			March 31, 2025			June 30, 2024			June 30, 2025			June 30, 2024
GAAP income (loss) from operations			$	(1,345	)	$	6,718		$	1,958		$	5,373		$	2,428
	GAAP operating margin			-1.2	%		6.4	%		1.8	%		2.4	%		1.2	%

Add:	Total stock-based compensation			10,077			8,683			11,035			18,760			17,449
	Amortization of acquisition-related intangible assets			146			147			258			293			740
	Other operating expenses			9,151			-			-			9,151			-

Non-GAAP income from operations			$	18,029		$	15,548		$	13,251		$	33,577		$	20,617
	Non-GAAP operating margin			15.6	%		14.7	%		12.5	%		15.2	%		10.4	%


			Three Months Ended									Six Months Ended
RECONCILIATION OF PROVISION FOR INCOME TAXES			June 30, 2025			March 31, 2025			June 30, 2024			June 30, 2025			June 30, 2024
GAAP provision (benefit) for income taxes			$	(24	)	$	1,095		$	298		$	1,071		$	316
	GAAP effective tax rate			-1.8	%		11.1	%		5.8	%		9.5	%		3.5	%

Tax effect of adjustments to GAAP results				(871	)		239			(269	)		(632	)		(627	)

Non-GAAP provision for income taxes			$	847		$	856		$	567		$	1,703		$	943
	Non-GAAP effective tax rate			4.1	%		4.6	%		3.4	%		4.3	%		3.5	%


			Three Months Ended									Six Months Ended
RECONCILIATION OF NET INCOME PER SHARE (DILUTED)			June 30, 2025			March 31, 2025			June 30, 2024			June 30, 2025			June 30, 2024
GAAP net income			$	1,369		$	8,790		$	4,849		$	10,159		$	8,803

Adjustments to GAAP net income
	Stock-based compensation			10,077			8,683			11,035			18,760			17,449
	Amortization of acquisition-related intangible assets			146			147			258			293			740
	Other operating expenses			9,151			-			-			9,151			-
	Tax effect of items excluded from non-GAAP results			(871	)		239			(269	)		(632	)		(627	)

Non-GAAP net income			$	19,872		$	17,859		$	15,873		$	37,731		$	26,365

Average shares outstanding for calculation
	of non-GAAP net income per share (diluted)			56,387			57,123			56,984			56,787			57,104

Non-GAAP net income per share (diluted)			$	0.35		$	0.31		$	0.28		$	0.66		$	0.46

GAAP net income per share (diluted)			$	0.02		$	0.15		$	0.09		$	0.18		$	0.15

POWER INTEGRATIONS, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands)


		June 30, 2025			March 31, 2025			December 31, 2024
ASSETS
	CURRENT ASSETS:
	Cash and cash equivalents		66,935		$	49,614		$	50,972
	Short-term marketable securities		201,801			239,682			249,023
	Accounts receivable, net		27,583			22,806			27,172
	Inventories		168,396			169,068			165,612
	Prepaid expenses and other current assets		18,188			18,645			21,260
	Total current assets		482,903			499,815			514,039

	PROPERTY AND EQUIPMENT, net		147,955			146,786			149,562
	INTANGIBLE ASSETS, net		7,660			7,868			8,075
	GOODWILL		95,271			95,271			95,271
	DEFERRED TAX ASSETS		37,174			38,906			36,485
	OTHER ASSETS		26,574			25,754			25,394
	Total assets	$	797,537		$	814,400		$	828,826

LIABILITIES AND STOCKHOLDERS’ EQUITY
	CURRENT LIABILITIES:
	Accounts payable	$	31,044		$	33,587		$	29,789
	Accrued payroll and related expenses		14,881			12,526			13,987
	Taxes payable		751			781			961
	Other accrued liabilities		18,323			8,056			10,580
	Total current liabilities		64,999			54,950			55,317

	LONG-TERM LIABILITIES:
	Income taxes payable		4,063			3,992			3,871
	Other liabilities		24,687			19,643			19,866
	Total liabilities		93,749			78,585			79,054

	STOCKHOLDERS' EQUITY:
	Common stock		21			22			22
	Additional paid-in capital		-			7,106			18,734
	Accumulated other comprehensive loss		(1,287	)		(2,183	)		(3,023	)
	Retained earnings		705,054			730,870			734,039
	Total stockholders' equity		703,788			735,815			749,772
	Total liabilities and stockholders' equity	$	797,537		$	814,400		$	828,826

POWER INTEGRATIONS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)

		Three Months Ended									Six Months Ended
		June 30, 2025			March 31, 2025			June 30, 2024			June 30, 2025			June 30, 2024
CASH FLOWS FROM OPERATING ACTIVITIES:
	Net income	$	1,369		$	8,790		$	4,849		$	10,159		$	8,803
	Adjustments to reconcile net income to cash provided by operating activities:
	Depreciation		7,002			7,244			8,391			14,246			17,106
	Amortization of intangible assets		208			207			320			415			863
	Loss on disposal of property and equipment		-			-			-			-			8
	Stock-based compensation expense		10,077			8,683			11,035			18,760			17,449
	Accretion of discount on marketable securities		(375	)		(346	)		(413	)		(721	)		(909	)
	Deferred income taxes		1,683			(2,537	)		(2,152	)		(854	)		(3,482	)
	Increase (decrease) in accounts receivable allowance for credit losses		-			(381	)		163			(381	)		326
	Change in operating assets and liabilities:
	Accounts receivable		(4,777	)		4,747			(4,256	)		(30	)		(2,024	)
	Inventories		672			(3,456	)		(2,019	)		(2,784	)		(6,720	)
	Prepaid expenses and other assets		3,036			3,369			1,226			6,405			2,072
	Accounts payable		(3,754	)		4,002			(1,411	)		248			(117	)
	Taxes payable and other accrued liabilities		13,931			(3,936	)		1,898			9,995			161
	Net cash provided by operating activities		29,072			26,386			17,631			55,458			33,536

CASH FLOWS FROM INVESTING ACTIVITIES:
	Purchases of property and equipment		(5,926	)		(5,726	)		(4,167	)		(11,652	)		(8,510	)
	Purchases of marketable securities		(42,066	)		(5,630	)		(27,918	)		(47,696	)		(77,830	)
	Proceeds from sales and maturities of marketable securities		80,610			15,882			31,194			96,492			85,392
	Net cash provided by (used in) investing activities		32,618			4,526			(891	)		37,144			(948	)

CASH FLOWS FROM FINANCING ACTIVITIES:
	Net proceeds from issuance of common stock		-			2,787			-			2,787			2,691
	Repurchase of common stock		(32,560	)		(23,098	)		(11,338	)		(55,658	)		(25,979	)
	Payments of dividends to stockholders		(11,809	)		(11,959	)		(11,352	)		(23,768	)		(22,736	)
	Proceeds from draw on line of credit		13,000			-			-			13,000			-
	Payments on line of credit		(13,000	)		-			-			(13,000	)		-
	Net cash used in financing activities		(44,369	)		(32,270	)		(22,690	)		(76,639	)		(46,024	)

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS			17,321			(1,358	)		(5,950	)		15,963			(13,436	)

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD			49,614			50,972			56,443			50,972			63,929

CASH AND CASH EQUIVALENTS AT END OF PERIOD		$	66,935		$	49,614		$	50,493		$	66,935		$	50,493