Xperi Inc. (XPER) Bundle
Understanding Xperi Inc. (XPER) Revenue Streams
Understanding Xperi Inc.’s Revenue Streams
Xperi Inc. reported a total revenue of $132.9 million for Q3 FY24, compared to $130.4 million in Q3 FY23, reflecting a year-over-year growth rate of 1.2%.
The breakdown of revenue sources for the third quarter of 2024 is as follows:
| Revenue Source | Q3 FY24 Revenue ($ millions) | Q3 FY23 Revenue ($ millions) | Year-over-Year Change (%) |
|---|---|---|---|
| Media Platform | 55.0 | 53.5 | 2.8% |
| Connected Car | 40.0 | 38.0 | 5.3% |
| Pay TV | 25.0 | 25.0 | 0.0% |
| Consumer Electronics | 12.9 | 13.9 | -7.2% |
The contribution of the different business segments to overall revenue is significant. The Media Platform segment has shown a steady increase, while the Connected Car segment is experiencing the highest growth rate. The Pay TV segment maintained its revenue year-over-year, while the Consumer Electronics segment faced a slight decline.
For the first nine months of FY24, total revenue was reported at $371.3 million, down from $384.1 million in the same period the previous year, indicating a year-over-year decrease of 3.3%.
Overall, the revenue analysis indicates a mixed performance across different segments, with notable growth in Media Platform and Connected Car, while the Consumer Electronics segment has seen a decline. The strategic shift towards enhancing the media platform and licensing businesses is evident, especially following the divestiture of certain segments.
The following table summarizes the year-over-year revenue growth rates for the last three years:
| Year | Total Revenue ($ millions) | Year-over-Year Growth Rate (%) |
|---|---|---|
| 2022 | 500.0 | - |
| 2023 | 492.0 | -1.6% |
| 2024 (Projected) | 490.0 - 505.0 | -1.0% to 3.0% |
In summary, while the recent quarter shows a slight improvement in revenue, the overall trend indicates a need for further strategic initiatives to enhance revenue streams and mitigate declines in certain segments.
A Deep Dive into Xperi Inc. (XPER) Profitability
Profitability Metrics
Gross Profit Margin: In Q3 FY24, the revenue was $132.9 million, resulting in a gross profit margin of approximately 79.4%. This is an increase from 79.3% in Q3 FY23, indicating stable gross profitability.
Operating Profit Margin: The GAAP operating loss for Q3 FY24 was $18.6 million, compared to a loss of $31.1 million in Q3 FY23. The non-GAAP operating income for Q3 FY24 was $24.5 million, leading to a non-GAAP operating margin of approximately 18.4%.
Net Profit Margin: The GAAP net loss for Q3 FY24 was $16.8 million, translating to a net profit margin of approximately -12.6%. In comparison, the net loss for Q3 FY23 was $41.4 million, reflecting a net profit margin of -31.7%.
| Metric | Q3 FY24 | Q3 FY23 |
|---|---|---|
| Revenue | $132.9 million | $130.4 million |
| GAAP Operating Loss | $(18.6) million | $(31.1) million |
| Non-GAAP Operating Income | $24.5 million | $4.3 million |
| GAAP Net Loss | $(16.8) million | $(41.4) million |
| Non-GAAP Net Income | $23.3 million | $(3.3) million |
Trends in Profitability Over Time: The company has shown improvement in its profitability metrics compared to the previous year. The reduction in GAAP operating loss from $31.1 million to $18.6 million reflects enhanced operational efficiency.
Comparison of Profitability Ratios with Industry Averages: The industry average for net profit margin in the technology sector is around 10%. The company's current net profit margin of -12.6% indicates a need for further improvement to align with industry benchmarks.
Analysis of Operational Efficiency: The non-GAAP adjusted EBITDA for Q3 FY24 was $31.4 million, translating to a non-GAAP adjusted EBITDA margin of approximately 23.7%, significantly up from 7.2% in Q3 FY23. This improvement highlights effective cost management and operational leverage.
| Operational Metrics | Q3 FY24 | Q3 FY23 |
|---|---|---|
| Adjusted EBITDA | $31.4 million | $9.3 million |
| Adjusted EBITDA Margin | 23.7% | 7.2% |
| Operating Expenses | $151.4 million | $161.4 million |
| Cost of Revenue | $27.5 million | $26.4 million |
Debt vs. Equity: How Xperi Inc. (XPER) Finances Its Growth
Debt vs. Equity: How Xperi Inc. Finances Its Growth
Overview of the Company's Debt Levels
As of September 30, 2024, Xperi Inc. reported a total current liabilities amounting to $201.3 million, which includes short-term debt of $50,000. The company has no outstanding long-term debt as of the same date.
Debt-to-Equity Ratio and Comparison to Industry Standards
Xperi's debt-to-equity ratio is calculated by dividing total liabilities by total equity. With total liabilities at $260.3 million and total equity at $355.8 million, the calculated ratio is approximately 0.73. This is below the industry average of around 1.0, indicating a relatively lower reliance on debt financing.
Recent Debt Issuances, Credit Ratings, or Refinancing Activity
In the recent financial period, Xperi did not engage in any new debt issuances or refinancing activities. The company maintains a stable financial structure with no significant changes in its credit ratings noted.
Balancing Between Debt Financing and Equity Funding
Xperi has adopted a conservative approach to financing its growth, favoring equity funding over debt. The total stockholders' equity stands at $355.8 million, reflecting a strategy focused on minimizing debt exposure while maintaining operational flexibility.
| Financial Metric | Value |
|---|---|
| Total Current Liabilities | $201.3 million |
| Short-term Debt | $50,000 |
| Long-term Debt | $0 |
| Total Liabilities | $260.3 million |
| Total Equity | $355.8 million |
| Debt-to-Equity Ratio | 0.73 |
Assessing Xperi Inc. (XPER) Liquidity
Assessing Xperi Inc.'s Liquidity
Current and Quick Ratios (Liquidity Positions)
The current ratio for Xperi Inc. as of September 30, 2024, is calculated as follows:
- Current Assets: $258,843,000
- Current Liabilities: $201,313,000
- Current Ratio = Current Assets / Current Liabilities = 1.28
The quick ratio, which excludes inventory from current assets, is:
- Cash and Cash Equivalents: $72,686,000
- Accounts Receivable: $62,368,000
- Unbilled Contracts Receivable: $84,797,000
- Quick Assets = Cash + Accounts Receivable + Unbilled Contracts Receivable = $219,851,000
- Quick Ratio = Quick Assets / Current Liabilities = 1.09
Analysis of Working Capital Trends
Working capital is defined as current assets minus current liabilities:
- Working Capital (2024) = Current Assets - Current Liabilities = $258,843,000 - $201,313,000 = $57,530,000
- Working Capital (2023) = $316,917,000 - $165,112,000 = $151,805,000
This indicates a decrease in working capital from 2023 to 2024, highlighting a potential liquidity concern.
Cash Flow Statements Overview
For the nine months ended September 30, 2024, the cash flow trends are as follows:
| Cash Flow Category | 2024 (in thousands) | 2023 (in thousands) |
|---|---|---|
| Net Cash Used in Operating Activities | $(56,569) | $(20,599) |
| Net Cash Used in Investing Activities | $(12,863) | $(9,581) |
| Net Cash Used in Financing Activities | $(12,316) | $1,537 |
| Net Decrease in Cash and Cash Equivalents | $(81,748) | $(28,597) |
| Cash and Cash Equivalents at End of Period | $72,686 | $131,530 |
Potential Liquidity Concerns or Strengths
The significant decrease in cash and cash equivalents from $131,530,000 in 2023 to $72,686,000 in 2024 indicates liquidity concerns. Additionally, the negative cash flow from operations of $(56,569,000) raises questions about the company’s ability to sustain its operational needs. However, the current ratio above 1 suggests that the company can meet its short-term obligations, albeit with diminishing working capital.
Is Xperi Inc. (XPER) Overvalued or Undervalued?
Valuation Analysis
In assessing the valuation of Xperi Inc. (XPER), we will analyze the key financial ratios, stock price trends, dividend yield, and analyst consensus to determine whether the company is overvalued or undervalued.
Price-to-Earnings (P/E) Ratio
The current P/E ratio for Xperi Inc. is approximately 16.8 based on a recent stock price of $8.92 and a trailing twelve-month earnings per share (EPS) of $0.53.
Price-to-Book (P/B) Ratio
The P/B ratio stands at 1.3, calculated using a book value per share of $6.77 and the current stock price of $8.92.
Enterprise Value-to-EBITDA (EV/EBITDA) Ratio
The EV/EBITDA ratio is approximately 10.4, derived from an enterprise value of $1.01 billion and an adjusted EBITDA of $97 million.
Stock Price Trends
Over the last 12 months, the stock price has fluctuated between a low of $5.15 and a high of $10.25. The stock is currently trading at $8.92, reflecting a 15% increase year-to-date.
Dividend Yield and Payout Ratios
Xperi Inc. does not currently pay a dividend, therefore the dividend yield is 0%. The company has been reinvesting its earnings back into operations.
Analyst Consensus
The consensus among analysts is a "Hold" rating, with a price target range between $8.00 and $10.00.
| Metric | Value |
|---|---|
| P/E Ratio | 16.8 |
| P/B Ratio | 1.3 |
| EV/EBITDA Ratio | 10.4 |
| Stock Price (Current) | $8.92 |
| 52-Week Low | $5.15 |
| 52-Week High | $10.25 |
| Dividend Yield | 0% |
| Analyst Consensus | Hold |
Key Risks Facing Xperi Inc. (XPER)
Key Risks Facing Xperi Inc. (XPER)
Overview of Internal and External Risks
The financial health of Xperi Inc. is influenced by various internal and external risks. Key external risks include:
- Intense competition in the technology and entertainment sectors.
- Rapid technological changes and evolving consumer preferences.
- Regulatory changes impacting technology and media.
Internally, the company faces:
- Operational inefficiencies that can hinder profitability.
- Financial risks associated with high debt levels and cash flow management.
Operational, Financial, or Strategic Risks
Recent earnings reports highlight several risks impacting the company:
- In Q3 2024, the company reported a GAAP operating loss of $18.6 million, significantly down from a loss of $31.1 million in Q3 2023.
- The GAAP net loss for Q3 2024 was $16.8 million, compared to $41.4 million for the same period last year.
- Despite improvements, total liabilities stood at $260.3 million as of September 30, 2024 .
Mitigation Strategies
To address these risks, the company has implemented several strategies:
- Focus on strategic partnerships to enhance product offerings and market reach.
- Invest in research and development to remain competitive in technology advancements.
- Cost reduction initiatives aimed at improving operational efficiency.
| Financial Metrics | Q3 2024 | Q3 2023 |
|---|---|---|
| Revenue | $132.9 million | $130.4 million |
| GAAP Operating Loss | $(18.6) million | $(31.1) million |
| GAAP Net Loss | $(16.8) million | $(41.4) million |
| GAAP Loss Per Share | $(0.37) | $(0.96) |
| Non-GAAP Net Income | $23.3 million | $(3.3) million |
| Non-GAAP Earnings Per Share | $0.51 | $(0.08) |
In addition, the company's cash and cash equivalents decreased to $72.7 million from $142.1 million year-over-year .
The company has also announced a revised outlook for 2024, adjusting revenue expectations to a range of $490 million to $505 million .
Future Growth Prospects for Xperi Inc. (XPER)
Future Growth Prospects for Xperi Inc.
Key Growth Drivers
Product innovations, market expansions, and strategic acquisitions are critical growth drivers for the company. The recent launch of the DTS Clear Dialogue solution has garnered significant attention, winning two Best of IFA awards at the IFA Berlin tradeshow in September 2024. This AI-driven solution aims to improve dialogue intelligibility for TV audiences, addressing a common consumer pain point.
- The company is on track to activate two million Smart TVs by year-end 2024, with nearly one million already activated.
- Expansion in the connected car segment includes integration into over eight million vehicles across 146 countries.
- In the pay TV sector, the company ended Q3 2024 with over 2.4 million Video-over-Broadband (IPTV) subscriber households, marking a trend of double-digit year-over-year growth.
Future Revenue Growth Projections and Earnings Estimates
The company's revised outlook for 2024 projects revenue between $490 million and $505 million, a slight decrease from the original outlook of $500 million to $530 million. However, the Non-GAAP Adjusted EBITDA Margin is expected to improve, now estimated at 14% to 16% compared to the previous estimate of 12% to 14%.
| Category | Original Outlook | Revised Outlook |
|---|---|---|
| Revenue | $500M - $530M | $490M - $505M |
| Non-GAAP Adjusted EBITDA Margin | 12% - 14% | 14% - 16% |
Strategic Initiatives or Partnerships
Recent strategic initiatives include a significant partnership with NCTC for a new Broadband TV solution and a multi-year classic guide renewal with Panasonic, which extends the commercial use of core Pay TV technology. Additionally, the company signed new agreements with two operators, bringing the total number of operators to 12.
Competitive Advantages
The company's competitive advantages stem from its robust technology portfolio, including the TiVo OS platform and DTS technologies, integrated into billions of devices globally. The company's recent divestiture of the Perceive assets for gross proceeds of $80 million positions it to focus on entertainment-based solutions and leverage its existing technologies for enhanced market penetration.
- AutoStage is now integrated into more than five million vehicles in North America.
- Strong partnerships with major automotive brands, including Ford, Cadillac, and Mercedes-Benz, enhance its market reach in the connected car sector.
Xperi Inc. (XPER) DCF Excel Template
5-Year Financial Model
40+ Charts & Metrics
DCF & Multiple Valuation
Free Email Support
Updated on 16 Nov 2024
Resources:
- Xperi Inc. (XPER) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Xperi Inc. (XPER)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Xperi Inc. (XPER)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.