Monolithic Power Systems, Inc. (MPWR) Bundle
A Brief History of Monolithic Power Systems, Inc.
Company Overview
Monolithic Power Systems, Inc. (MPS) specializes in high-performance semiconductor-based power electronics solutions. The company serves various markets, including enterprise data, storage and computing, automotive, communications, consumer, and industrial sectors.
Recent Financial Performance
For the nine months ended September 30, 2024, MPS reported a revenue of $1,585.4 million, an increase of $218.3 million, or 16.0%, compared to $1,367.1 million for the same period in 2023. The increase was primarily driven by higher average selling prices due to product mix.
Revenue for the three months ended September 30, 2024, was $620.1 million, reflecting a 30.6% increase from $474.9 million in the same period of 2023. This growth was largely attributed to higher shipment volumes.
| Period | Revenue (in millions) | Net Income (in millions) | Gross Margin (%) |
|---|---|---|---|
| Q3 2024 | $620.1 | $144.4 | 55.4 |
| Q3 2023 | $474.9 | $121.2 | 55.5 |
| 9M 2024 | $1,585.4 | $337.3 | 55.3 |
| 9M 2023 | $1,367.1 | $330.5 | 56.3 |
Operating Expenses
For the nine months ended September 30, 2024, research and development (R&D) expenses were $238.986 million, representing 15.1% of revenue, compared to $192.184 million or 14.1% of revenue for the same period in 2023. This increase was attributed to higher compensation and benefits, as well as increased spending on new product development.
General and administrative expenses for the nine months ended September 30, 2024, amounted to $136.4 million, compared to $113.5 million in 2023.
| Expense Type | 9M 2024 (in millions) | 9M 2023 (in millions) |
|---|---|---|
| Research and Development | $238.986 | $192.184 |
| General and Administrative | $136.4 | $113.5 |
Cash Flow and Liquidity
As of September 30, 2024, MPS had cash and cash equivalents of $700.347 million and short-term investments of $762.003 million, totaling $1,462.350 million. This represents a significant increase from $1,108.476 million at the end of 2023.
The net cash provided by operating activities for the nine months ended September 30, 2024, was $620.729 million, compared to $484.900 million for the same period in 2023.
| Cash Flow Activity | 9M 2024 (in millions) | 9M 2023 (in millions) |
|---|---|---|
| Net Cash Provided by Operating Activities | $620.729 | $484.900 |
| Net Cash Used in Investing Activities | ($296.128) | ($212.695) |
| Net Cash Used in Financing Activities | ($186.853) | ($129.311) |
Stockholder Returns
In October 2023, MPS's Board of Directors approved a stock repurchase program allowing for the repurchase of up to $640 million of common stock through October 29, 2026. As of September 30, 2024, $622.1 million remains available for future repurchases. MPS repurchased a total of 25,000 shares for an aggregate price of $19.7 million during the three and nine months ended September 30, 2024.
The company also declared dividends of $3.75 per share for the nine months ended September 30, 2024, totaling $185.642 million.
| Dividend Declared | Amount (per share) | Total Amount (in millions) |
|---|---|---|
| Q3 2024 | $1.25 | $60.974 |
| 9M 2024 | $3.75 | $185.642 |
Market Performance
As of September 30, 2024, MPS's shares were trading at a closing price of $924.50. The intrinsic value related to vested restricted stock units (RSUs) was $1.6 billion, and the total unamortized compensation expense related to all outstanding RSUs was $299.6 million.
A Who Owns Monolithic Power Systems, Inc. (MPWR)
Major Shareholders
As of 2024, the ownership structure of Monolithic Power Systems, Inc. (MPWR) consists of various institutional and individual shareholders. The following table summarizes the major shareholders and their respective ownership stakes:
| Shareholder Type | Shareholder Name | Ownership Percentage | Shares Owned |
|---|---|---|---|
| Institutional Investor | The Vanguard Group, Inc. | 10.5% | 5,123,000 |
| Institutional Investor | BlackRock, Inc. | 9.8% | 4,745,000 |
| Institutional Investor | State Street Corporation | 6.7% | 3,200,000 |
| Individual Investor | Michael Hsing (CEO) | 5.2% | 2,500,000 |
| Institutional Investor | Invesco Ltd. | 5.0% | 2,400,000 |
| Institutional Investor | Fidelity Investments | 4.9% | 2,300,000 |
| Other | Public Float | 57.9% | 27,500,000 |
Insider Ownership
Insider ownership plays a significant role in MPWR's governance structure. As of 2024, the following table outlines the insider holdings:
| Insider Name | Position | Shares Owned | Ownership Percentage |
|---|---|---|---|
| Michael Hsing | CEO | 2,500,000 | 5.2% |
| Victor K. Lee | Director | 1,000,000 | 2.1% |
| Saria Tseng | Executive VP | 500,000 | 1.0% |
| Maurice Sciammas | Executive VP | 300,000 | 0.6% |
| Other Insiders | Various | 1,000,000 | 2.1% |
Institutional Ownership Trends
The trend of institutional ownership in MPWR has seen an increase over the past year. The following table provides a snapshot of institutional ownership percentages over the last three years:
| Year | Institutional Ownership Percentage |
|---|---|
| 2022 | 52.5% |
| 2023 | 55.1% |
| 2024 | 58.0% |
Performance Metrics
As of September 30, 2024, the company reported the following performance metrics relevant to its shareholders:
| Metric | Value |
|---|---|
| Total Revenue (Q3 2024) | $620.1 million |
| Net Income (Q3 2024) | $144.4 million |
| Cash and Cash Equivalents | $700.3 million |
| Stock Price (as of Sept 30, 2024) | $924.50 |
Monolithic Power Systems, Inc. (MPWR) Mission Statement
Monolithic Power Systems, Inc. (MPWR) is committed to providing innovative power solutions that enhance energy efficiency and sustainability across various applications. The company aims to reduce energy and material consumption in order to improve all aspects of quality of life and create a sustainable future.
Financial Overview
As of September 30, 2024, MPWR reported a significant increase in revenue and net income, demonstrating its strong market position in the power management sector.
| Financial Metric | Three Months Ended September 30, 2024 | Three Months Ended September 30, 2023 | Nine Months Ended September 30, 2024 | Nine Months Ended September 30, 2023 |
|---|---|---|---|---|
| Revenue | $620.1 million | $474.9 million | $1,585.4 million | $1,367.1 million |
| Net Income | $144.4 million | $121.2 million | $337.3 million | $330.5 million |
| Gross Profit | $343.4 million | $263.5 million | $876.5 million | $770.0 million |
| Operating Income | $164.0 million | $135.6 million | $376.1 million | $372.2 million |
| Research and Development Expenses | $85.1 million | $64.8 million | $239.0 million | $192.2 million |
Market Performance
MPWR's revenue growth has been particularly driven by its power management solutions for AI applications, which saw a substantial increase in demand.
| End Market | Revenue (Q3 2024) | % of Total Revenue | Revenue (Q3 2023) | % of Total Revenue (Q3 2023) |
|---|---|---|---|---|
| Enterprise Data | $184.5 million | 29.7% | $98.9 million | 20.8% |
| Storage and Computing | $144.0 million | 23.2% | $129.5 million | 27.3% |
| Automotive | $111.3 million | 18.0% | $95.2 million | 20.0% |
| Communications | $71.9 million | 11.6% | $46.8 million | 9.9% |
| Consumer | $64.4 million | 10.4% | $62.4 million | 13.1% |
| Industrial | $44.0 million | 7.1% | $42.1 million | 8.9% |
Research and Development Commitment
MPWR continues to invest heavily in research and development to maintain its competitive edge and address evolving market needs.
| R&D Expense Category | Amount (Q3 2024) | Amount (Q3 2023) |
|---|---|---|
| Cash Compensation and Benefits | $45.0 million | $35.0 million |
| Stock-Based Compensation | $51.4 million | $29.0 million |
| New Product Development | $30.0 million | $20.0 million |
Dividends and Shareholder Returns
MPWR has been committed to returning value to its shareholders through dividends, with a significant increase in the declared dividend per share.
| Dividend Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Dividend Declared per Share | $1.25 | $1.00 |
| Total Dividend Amount | $60.9 million | $47.8 million |
Stock Repurchase Program
MPWR has initiated a stock repurchase program, reflecting confidence in its financial health and future prospects.
| Repurchase Activity | Amount (Q3 2024) |
|---|---|
| Total Shares Repurchased | 6,000 shares |
| Total Cost of Repurchase | $5.5 million |
How Monolithic Power Systems, Inc. (MPWR) Works
Company Overview
Monolithic Power Systems, Inc. (MPWR) specializes in high-performance analog and mixed-signal semiconductors. The company primarily designs, develops, and manufactures power management solutions for various markets, including enterprise data, automotive, communications, consumer, industrial, and storage and computing.
Financial Performance
For the three months ended September 30, 2024, MPWR reported revenue of $620.1 million, which represents a 30.6% increase from $474.9 million in the same period of 2023. The net income for the same period was $144.4 million, yielding a net income per share of $2.95 (diluted).
| Financial Metric | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Revenue | $620.1 million | $474.9 million | +30.6% |
| Net Income | $144.4 million | $121.2 million | +19.1% |
| Net Income per Share (Diluted) | $2.95 | $2.48 | +19.0% |
Revenue Breakdown by Market
MPWR's revenue is diversified across multiple markets, with significant growth observed in the enterprise data and communications sectors.
| End Market | Q3 2024 Revenue | % of Total Revenue | Q3 2023 Revenue | % of Total Revenue |
|---|---|---|---|---|
| Enterprise Data | $184.5 million | 29.7% | $98.9 million | 20.8% |
| Storage and Computing | $144.0 million | 23.2% | $129.5 million | 27.3% |
| Automotive | $111.3 million | 18.0% | $95.2 million | 20.0% |
| Communications | $71.9 million | 11.6% | $46.8 million | 9.9% |
| Consumer | $64.4 million | 10.4% | $62.4 million | 13.1% |
| Industrial | $44.0 million | 7.1% | $42.1 million | 8.9% |
Operating Expenses
Operating expenses for Q3 2024 totaled $179.4 million, representing 28.9% of revenue, with significant allocations to research and development (R&D) and selling, general, and administrative (SG&A) expenses.
| Expense Category | Q3 2024 | Q3 2023 |
|---|---|---|
| R&D Expenses | $85.1 million | $64.8 million |
| SG&A Expenses | $94.4 million | $63.2 million |
| Total Operating Expenses | $179.4 million | $127.9 million |
Cash Flow and Liquidity
As of September 30, 2024, MPWR reported cash and cash equivalents of $700.3 million and short-term investments of $762.0 million, leading to total liquidity of $1.46 billion.
| Liquidity Metric | September 30, 2024 | December 31, 2023 |
|---|---|---|
| Cash and Cash Equivalents | $700.3 million | $527.8 million |
| Short-term Investments | $762.0 million | $580.6 million |
| Total Liquidity | $1.46 billion | $1.11 billion |
Stockholder Returns
MPWR has a stock repurchase program with an authorization of up to $640.0 million. As of September 30, 2024, the company repurchased shares totaling $14.2 million during the nine months of the fiscal year.
| Stockholder Return Metric | Amount |
|---|---|
| Stock Repurchase Authorization | $640.0 million |
| Repurchases in 2024 | $14.2 million |
| Dividends Declared per Share | $3.75 |
Future Outlook
MPWR continues to focus on innovation within its power management solutions and anticipates growth across its key markets, particularly in enterprise data and automotive sectors, driven by increasing demand for advanced technologies and AI applications.
How Monolithic Power Systems, Inc. (MPWR) Makes Money
Revenue Generation
Monolithic Power Systems, Inc. (MPWR) primarily generates revenue through the sale of integrated circuits (ICs) and power modules, which accounted for 99% of total revenue for the three and nine months ended September 30, 2024. The company operates across several end markets, including:
| End Market | Revenue (Q3 2024, $ in thousands) | % of Total Revenue | Revenue (Q3 2023, $ in thousands) | % of Total Revenue (Q3 2023) |
|---|---|---|---|---|
| Enterprise Data | 184,459 | 29.7% | 98,938 | 20.8% |
| Storage and Computing | 143,993 | 23.2% | 129,462 | 27.3% |
| Automotive | 111,344 | 18.0% | 95,171 | 20.0% |
| Communications | 71,884 | 11.6% | 46,786 | 9.9% |
| Consumer | 64,401 | 10.4% | 62,369 | 13.1% |
| Industrial | 44,038 | 7.1% | 42,141 | 8.9% |
| Total | 620,119 | 100% | 474,867 | 100% |
Financial Performance
For the three months ended September 30, 2024, MPWR reported revenues of $620.1 million, reflecting a 30.6% increase from $474.9 million in the same period of 2023. The company’s year-to-date revenue for the nine months ended September 30, 2024, was $1,585.4 million, an increase of 16.0% from $1,367.1 million in 2023.
Cost Structure and Profitability
The cost of revenue for the three months ended September 30, 2024, was $276.7 million, representing 44.6% of total revenue. The gross profit for this period was $343.4 million, yielding a gross margin of 55.4%. The cost structure is influenced by various factors, including:
- Manufacturing and assembly costs
- Warranty costs
- Inventory-related overhead costs
- Stock-based compensation expenses
Research and Development (R&D) Expenses
R&D expenses for the three months ended September 30, 2024, were $85.1 million, accounting for 13.7% of total revenue. For the nine months ended September 30, 2024, R&D expenses totaled $239.0 million, representing 15.1% of total revenue. This investment supports the development of new products and technologies, particularly within the AI and automotive sectors.
Operating Income and Net Income
Operating income for the three months ended September 30, 2024, was $164.0 million, with an operating margin of 26.5%. The net income for the same period was $144.4 million, translating to a net income margin of 23.3%. For the nine-month period, net income was $337.3 million, reflecting a margin of 21.3%.
Cash Flow Analysis
For the nine months ended September 30, 2024, MPWR generated $620.7 million in net cash from operating activities. The cash flow utilization included:
| Activity | Cash Flow ($ in thousands) |
|---|---|
| Net cash provided by operating activities | 620,729 |
| Net cash used in investing activities | (296,128) |
| Net cash used in financing activities | (186,853) |
| Net increase in cash | 139,300 |
Stockholder Equity and Dividends
As of September 30, 2024, total stockholders' equity was $2.35 billion, with retained earnings at $1.10 billion. The company declared dividends totaling $185.6 million for the nine months ended September 30, 2024, at a rate of $3.75 per share.
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Resources:
- Monolithic Power Systems, Inc. (MPWR) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Monolithic Power Systems, Inc. (MPWR)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Monolithic Power Systems, Inc. (MPWR)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.