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SITIME Corp (SITM)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 revenue of $68.1M grew 18% q/q and 61% y/y; non-GAAP EPS was $0.48 vs $0.40 in Q3, with non-GAAP gross margin at 58.8% driven by favorable product mix .
  • The company exceeded its prior Q4 guidance (revenue $63–$65M; non-GAAP GM 58–58.5%; EPS $0.39–$0.45) and noted it “surpassed revenue expectations,” citing broad strength and AI-driven CED demand .
  • Management guides Q1 2025 revenue to $53–$55M and non-GAAP GM ~57%, reflecting typical seasonality and absorption/depreciation headwinds as new products ramp; Q1 non-GAAP EPS expected at $0.09–$0.13 .
  • Strategic catalysts: strong bookings entering 2025, CED leadership in AI infrastructure, initial revenue from Aura clocks (accretive margins), and an explicit path back toward ~60% gross margins over time .

What Went Well and What Went Wrong

What Went Well

  • Broad-based strength across segments; CED revenue $24.8M (37% of Q4 sales) up 156% y/y; Auto/Industrial/Aerospace $20.5M (30%); Mobile/IoT/Consumer $22.8M (33%). CFO: “performance was driven by broad-based strength across our customer segments” .
  • AI data center timing leadership: content in NIC cards, switches, optical modules, GPUs; launched Super-TCXO (5977) delivering up to 3x better synchronization, 4x smaller size, 20x better reliability in targeted GPU/networking use cases .
  • Profitability expansion: non-GAAP operating income $7.6M (+$3.6M q/q), non-GAAP EPS $0.48 (vs $0.40 in Q3) with non-GAAP GM up 70 bps q/q to 58.8% on mix .

What Went Wrong

  • GAAP still loss-making: Q4 GAAP net loss of $(18.8)M; GAAP loss from operations $(23.0)M; GAAP gross margin 52.6% vs 55.9% in year-ago Q4 .
  • Near-term margin headwinds: Q1 GM guided to ~57% due to seasonality (manufacturing absorption) and added depreciation from new product ramps; yields/test time need further maturation .
  • Inventory elevated to $76.7M (vs $71.9M in Q3), reflecting ramp and product investments; Q4 OpEx (non-GAAP) rose to $32.5M with increased R&D for new platforms .

Financial Results

MetricQ2 2024Q3 2024Q4 2024
Revenue ($USD Millions)$43.9 $57.7 $68.1
GAAP Gross Margin (%)49.1% 51.1% 52.6%
Non-GAAP Gross Margin (%)57.7% 58.1% 58.8%
GAAP Operating Income ($M)$(32.3) $(24.9) $(23.0)
Non-GAAP Operating Income ($M)$(2.8) $4.0 $7.6
GAAP Diluted EPS ($)$(1.16) $(0.83) $(0.80)
Non-GAAP Diluted EPS ($)$0.12 $0.40 $0.48

Segment Mix (Q4 2024):

SegmentRevenue ($M)Mix (%)
Communications, Enterprise & Datacenter (CED)$24.8 37%
Automotive, Industrial & Aerospace$20.5 30%
Mobile, IoT & Consumer$22.8 33%
Largest End Customer$16.4 24%

Operational KPIs:

KPIQ2 2024Q3 2024Q4 2024
Accounts Receivable ($M)$21.0 $30.2 $38.1
DSOs (days)43 47 50
Inventory ($M)$70.8 $71.9 $76.7
Cash, Cash Equivalents & ST Investments ($M)$453 $435 $419
Cash Flow from Operations ($M)$(0.2) $8.2 $13.6
CapEx ($M)$2.6 $15.0 $16.0
Interest & Other Income ($M)$5.6 ~$4.5 $4.5
Aura Transaction Payments ($M)$69.0 $12.9 $7.0

Non-GAAP Adjustments (Q4 2024 highlights):

  • Non-GAAP gross profit adds back amortization of acquired intangibles ($3.6M) and stock-based comp ($0.7M) .
  • Non-GAAP OpEx excludes stock-based comp (R&D $10.0M; SG&A $14.6M) and acquisition-related costs ($1.8M) .
  • Non-GAAP net income reconciles add-backs for acquisition-related costs, intangibles amortization, and SBC to arrive at $11.8M, or $0.48 diluted EPS .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent (Actual/Guidance)Change
Revenue ($M)Q4 2024$63–$65 $68.1 (actual) Raised/Beat
Non-GAAP Gross Margin (%)Q4 202458.0–58.5 58.8 (actual) Raised/Beat
Non-GAAP OpEx ($M)Q4 2024$31.0–$31.5 $32.5 (actual) Higher than guided
Non-GAAP EPS ($)Q4 2024$0.39–$0.45 $0.48 (actual) Beat
Revenue ($M)Q1 2025N/A$53–$55 (guidance) New
Non-GAAP Gross Margin (%)Q1 2025N/A~57% (guidance) New
Non-GAAP OpExQ1 2025N/ARoughly flat seq. (guidance) New
Interest Income ($M)Q1 2025N/A$4.0–$4.5 (guidance) New
Non-GAAP EPS ($)Q1 2025N/A$0.09–$0.13 (guidance) New

Earnings Call Themes & Trends

TopicPrevious Mentions (Q2 2024, Q3 2024)Current Period (Q4 2024)Trend
AI infrastructure timing contentBroad design wins across NICs, switches, optical modules; $8–$25 timing content; expanding product families and yields ramping Continued leadership; 5977 Super-TCXO intro; CED to drive 2025 growth; bookings strong Strengthening
Gross margin trajectoryLonger-term target >60%; near-term headwinds from new product ramps/tooling absorption Q1 GM guided ~57% due to seasonality and depreciation; still targeting 60% over time Short-term dip, long-term up
OpEx leverageRevenue to grow much faster than OpEx; strategic R&D/go-to-market investments Q4 non-GAAP OpEx $32.5M; Q1 roughly flat; leverage intact Improving leverage
Aura acquisition & clockingProducts in roll-out; $100M medium-term clocking revenue target Initial revenue recognized; margins accretive; $7M payment in Q4 Building
Automotive/regionalADAS/EV focus; diverse use cases (radar/LiDAR/GPS); SAM $400–$500M; China strength 30–40% of auto business from China; continued penetration Stable to improving
Bookings & customer diversityStrong H2’24 bookings; multi-region growth Strong 2025 bookings across segments; lead times stable Solid

Management Commentary

  • CEO: “We reported over 30% growth across all customer segments, with our Communications, Enterprise, and Datacenter business experiencing significant gains due to the critical role of precision timing in AI” .
  • CEO: “Our oscillators have significant market share in 800G optical modules… roadmap for 1.6T and 3.2T modules” .
  • CFO: “Non-GAAP gross margins were 58.8%, up 70 bps sequentially and a bit better than expected due to favorable product mix” .
  • CEO: “We expect CED to continue to lead our growth in 2025… trends are driving demand for more precision timing with higher dollar content” .

Q&A Highlights

  • Segment growth outlook: 2025 growth led by CED; other segments growing but at a lesser rate .
  • Gross margin cadence: Q1 step down on absorption/depreciation; margins improve over time as yields/test times mature; still targeting ~60% longer-term .
  • Aura clocks: initial revenue in 2024; accretive margins; combined clocking plus high-end oscillators delivering “1+1=3” value to customers .
  • Auto China penetration: 30–40% of auto business from China given EV/automation innovation; expanding to U.S./EU/Japan as tech adoption rises .
  • OpEx leverage: revenue expected to grow faster than OpEx; Q1 OpEx roughly flat despite payroll tax timing; continued strategic R&D investments .

Estimates Context

  • S&P Global consensus estimates were unavailable at the time of analysis due to a data access limitation. As a proxy, the company beat its own Q4 financial guidance on revenue and non-GAAP EPS, indicating demand strength and favorable mix .
  • Where sell-side models included higher Q1 margin trajectories, management clarified near-term headwinds and reiterated a path back toward ~60% gross margins over time .

Key Takeaways for Investors

  • Revenue/EPS beat signals robust AI-driven demand and favorable mix; momentum into 2025 with strong bookings, especially in CED .
  • Near-term caution: Q1 seasonality and ramp-related absorption/depreciation will pressure GM to ~57%; watch inventory and yield progress .
  • Medium-term thesis supported by product breadth (Super-TCXO, OCXO, Aura clocks), higher timing content per system, and accretive clocking margins .
  • Operating leverage intact: OpEx growth constrained relative to revenue; sustained non-GAAP profitability likely as volumes scale .
  • Automotive growth diversifier with China-led innovation; broadening to Western OEMs as ADAS/SDV architectures adopt precision timing .
  • Expect continued segment diversification; CED leads, but mobile/consumer and industrial/aerospace remain healthy contributors .
  • Tactical: anticipate estimate revisions to reflect Q4 beat and Q1 seasonality; re-rate potential as GM normalizes and clocking ramps through 2025 .

Other Relevant Q4 2024 Press Releases

  • Event participation: Raymond James TMT & Consumer Conference (Dec 10, 2024) – indicative of active investor engagement during the quarter .