MPS (NASDAQ:MPWR) reported a 7.6% increase in third quarter revenue to $474.9 million, compared to Q2 2023, but a 4.1% decrease from Q3 2022. The company's GAAP gross margin was 55.5%, and its non-GAAP gross margin was 55.7%. The firm also announced a share buyback program of up to $640 million over the next three years. However, MPS forecasts a decrease in Q4 revenue to a range of $442 million to $462 million.
Key takeaways from the earnings call include:
- MPS saw significant growth in enterprise data revenue, up 106.2% from Q2 2023, while storage and computing revenue increased by 3.9%.
- Consumer, communications, automotive, and industrial revenue all decreased, with the most significant drop in the industrial sector at 15.3%.
- The company expects growth in the auto, AI, and power segments despite the overall decline forecasted for Q4.
- MPS has developed a silicon carbide power isolation module expected to generate revenue in the solar inverters market and automotive industry next year.
- The company plans to regrow its consumer market in Asia and anticipates significant revenue growth in the second half of next year.
During the earnings call, MPS executives discussed the current market conditions, including the downturn in the GPU market compared to the previous year. However, they noted a slight growth due to advancements in AI. The company also expressed uncertainty about the timing of revenue growth but highlighted partnerships with leading EV OEMs in the US and Asia.
MPS also revealed its plans for the upcoming year, including a product lineup featuring a silicon carbide power isolation module. This product is expected to generate revenue in the solar inverters and automotive markets. The company also plans to ramp up its inventory to meet anticipated demand in 2024.
The company is optimistic about its position in the AI GPU market and expects sustainable growth in the enterprise data segment. MPS also anticipates a return to normal pricing as the market stabilizes in 2024.
Regarding its consumer market, the company is committed to regrowing its presence in Asia. It also plans to implement a share buyback program to offset dilution over the next three years. The company stated that its lighting control business, which focuses primarily on industrial and decorative lighting, saw a sequential increase of $4.5 million.
The earnings call concluded with MPS expressing gratitude to participants and announcing plans to hold another webinar at the end of January for the fourth quarter.
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