MIGDAL HAEMEK, Israel, Aug. 02, 2021 (GLOBE NEWSWIRE) -- Tower Semiconductor (NASDAQ: TSEM & TASE: TSEM) reports today its results for the second quarter ended June 30, 2021.

Highlights

• Second quarter revenue of $362 million, reflecting record revenue for the company, with year over year 26% organic growth and 17% total growth.
• Significant year over year increases in gross profit, operating profit, and net profit.
• Guides mid-range revenue for the third quarter of 2021 of $385 million, demonstrating 24% year over year growth and 38% organic growth.
• Expanding the previously announced capacity expansion plan by an additional $100 million, to support continued increases in customers’ demand for highly differentiated 200mm platforms.
• Established partnership with ST Microelectronics accelerating the volume ramp-up of the Agrate 300mm factory, tripling Tower’s 300mm capacity. 

Second Quarter of 2021 Results Overview

Revenue for the second quarter of 2021 was $362 million, the highest quarterly revenue in Company’s history, as compared to $310 million in the second quarter of 2020, reflecting 17% year over year growth. Organic revenue for the second quarter of 2021, defined as total revenue excluding revenues from Nuvoton Japan (previously named Panasonic Semiconductor Solutions) and from Maxim in the San Antonio fab, grew by 26% year over year.

Gross profit for the second quarter of 2021 was $74 million, 28% higher than $58 million in the second quarter of 2020.

Operating profit for the second quarter of 2021 was $34 million, 54% higher than $22 million in the second quarter of 2020.

Net profit for the second quarter of 2021 was $31 million, or $0.29 basic earnings per share, 62% higher as compared to net profit of $19 million or $0.18 basic earnings per share in the second quarter of 2020.

Cash flow generated from operating activities in the second quarter of 2021 was $93 million with investment in fixed assets of $56 million, net. In addition, in the second quarter of 2021, the company repaid $20 million of its debt and invested $17 million in deposits and marketable securities. 

Agreement with ST Microelectronics accelerating the ramp-up of Agrate 300mm fab to large volumes
In June 2021, Tower and ST Microelectronics announced joining forces to accelerate Agrate 300mm factory ramp-up. Tower and ST will share the cleanroom in Agrate facility, with Tower installing its own equipment in one third of the total space. The transaction will support Tower’s customers’ increasing demand for analog RF, power platforms, displays and other technologies, tripling its 300mm foundry capacity.

Manufacturing Expansion and Capabilities
The Company continues to execute its $150 million capacity expansion plan and is now announcing an additional $100 million investment for further expansion of 200mm differentiated platforms.

Business Outlook
Tower Semiconductor guides revenue for the third quarter of 2021 to be $385 million, with an upward or downward range of 5%. Mid-range revenue guidance represents year over year 24% total growth and 38% organic growth.

Mr. Russell Ellwanger, Chief Executive Officer of Tower Semiconductor, stated: “We are excited with the second quarter 2021 record revenue performance, leading to a third quarter revenue guidance of substantial continued growth, breaking a $1.5 billion annual run rate. We remain confident that we are serving the right customers in the right markets as evidenced by the 38% mid-range year over year organic revenue growth guidance.”

Ellwanger added, “We are effectively executing our expansion plans, and hence expect continued fourth quarter 2021 growth in both top and bottom lines. Our announced partnership with ST Microelectronics at the Agrate, Italy 300mm factory, will significantly enhance our 300mm capabilities, in order to further boost our leading position in advanced 300mm based analog RF, power platforms, displays and other technologies.”

Teleconference and Webcast
Tower Semiconductor will host an investor conference call today, Monday, August 2, 2021, at 10:00 a.m. Eastern time (9:00 a.m. Central time, 8:00 a.m. Mountain time, 7:00 a.m. Pacific time and 5:00 p.m. Israel time) to discuss the company’s financial results for the second quarter of 2021 and its outlook.

This call will be webcast and can be accessed via Tower Semiconductor’s website at www.towersemi.com or by calling 1-888-642-5032 (U.S. Toll-Free), 03-918-0610 (Israel), +972-3-918-0610 (International).  For those who are not available to listen to the live broadcast, the call will be archived on Tower Semiconductor’s website for 90 days.

The Company presents its financial statements in accordance with U.S. GAAP.  The financial information included in the tables below includes unaudited condensed financial data. Some of the financial information in this release and/or in related public disclosures or filings with respect to the financial statements and/or results of the Company, which we describe in this release as “adjusted” financial measures, are non-GAAP financial measures as defined in Regulation G and related reporting requirements promulgated by the Securities and Exchange Commission as they apply to our Company. These adjusted financial measures are calculated excluding one or both of the following: (1) amortization of acquired intangible assets and (2) compensation expenses in respect of equity grants to directors, officers, and employees. These adjusted financial measures should be evaluated in conjunction with, and are not a substitute for, GAAP financial measures. The tables also present the GAAP financial measures, which are most comparable to the adjusted financial measures, as well as a reconciliation between the adjusted financial measures and the comparable GAAP financial measures. As used and/or presented in this release and/or in related public disclosures or filings with respect to the financial statements and/or results of the Company, as well as calculated in the tables herein, the term Earnings Before Interest Tax Depreciation and Amortization (EBITDA) consists of net profit in accordance with GAAP, excluding financing and other income (expense), net, taxes, non-controlling interest, depreciation and amortization expense and stock-based compensation expense. EBITDA is reconciled in the tables below from GAAP operating profit. EBITDA is not a required GAAP financial measure and may not be comparable to a similarly titled measure employed by other companies. EBITDA and the adjusted financial information presented herein and/or in related public disclosures or filings with respect to the financial statements and/or results of the Company, should not be considered in isolation or as a substitute for operating profit, net profit or loss, cash flows provided by operating, investing and financing activities, per share data or other profit or cash flow statement data prepared in accordance with GAAP. The term Net Cash, as used and/or presented in this release and/or in related public disclosures or filings with respect to the financial statements and/or results of the Company, is comprised of cash, cash equivalents, short-term deposits and marketable securities less debt amounts as presented in the balance sheets included herein. The term Net Cash is not a required GAAP financial measure, may not be comparable to a similarly titled measure employed by other companies and should not be considered in isolation or as a substitute for cash, debt, operating profit, net profit or loss, cash flows provided by operating, investing and financing activities, per share data or other profit or cash flow statement data prepared in accordance with GAAP. The term Free Cash Flow, as used and/or presented in this release and/or in related public disclosures or filings with respect to the financial statements and/or results of the Company, is calculated to be net cash provided by operating activities (in the amounts of $93 million, $87 million and $67 million for the three months periods ended June 30, 2021, March 31, 2021 and June 30, 2020, respectively) less cash used for investments in property and equipment, net (in the amounts of $56 million, $49 million and $63 million for the three months periods ended June 30, 2021, March 31, 2021 and June 30, 2020, respectively).  The term Free Cash Flow is not a required GAAP financial measure, may not be comparable to a similarly titled measure employed by other companies and should not be considered in isolation or as a substitute for operating profit, net profit or loss, cash flows provided by operating, investing and financing activities, per share data or other profit or cash flow statement data prepared in accordance with GAAP.