Exceeded 3Q Revenue Expectations, Growing Over 9% Sequentially

PLANO, Texas — (BUSINESS WIRE) — November 7, 2024 — Diodes Incorporated (Diodes) (Nasdaq: DIOD) today reported its financial results for the third quarter ended September 30, 2024.

Third Quarter Highlights

• Revenue was $350.1 million, compared to $319.8 million in the second quarter 2024 and $404.6 million in the third quarter 2023;
• Global Point of Sales (POS) increased over 10 percent sequentially in Asia;
• GAAP gross profit was $118.0 million, compared to $107.4 million in the second quarter 2024 and $155.9 million in the third quarter 2023;
• GAAP gross profit margin was 33.7 percent, compared to 33.6 percent in the second quarter 2024 and 38.5 percent in the third quarter 2023;
• GAAP net income was $13.7 million, compared to $8.0 million in the second quarter 2024 and $48.7 million in the third quarter 2023;
• Non-GAAP adjusted net income was $20.1 million, compared to $15.4 million in the second quarter 2024 and $52.5 million in the third quarter 2023;
• GAAP EPS was $0.30 per diluted share, compared to $0.17 per diluted share in the second quarter 2024 and $1.05 per diluted share in the third quarter 2023;
• Non-GAAP EPS was $0.43 per diluted share, compared to $0.33 per diluted share last quarter and $1.13 per diluted share in the prior year quarter;
• Excluding $5.9 million, net of tax, respectively, of non-cash share-based compensation expense, GAAP and non-GAAP earnings per share would have increased by $0.13 per share, respectively;
• EBITDA was $46.9 million, or 13.4 percent of revenue, compared to $41.1 million, or 12.8 percent of revenue, in the second quarter 2024 and $90.6 million, or 22.4 percent of revenue, in the third quarter 2023; and
• Cash flow provided by operations was $54.4 million and $39.4 million of free cash flow, including $15.0 million of capital expenditures. Net cash flow was $49.4 million, including borrowing of $9.7 million of total debt.

Commenting on the results, Gary Yu, President of Diodes, stated, “Third quarter revenue exceeded our expectations increasing 9.5% sequentially, while also achieving double-digit POS growth in Asia. As further evidence of the market recovery in Asia, our channel inventory continues to improve as both inventory dollars and inventory days decreased sequentially. Additionally, our automotive market revenue increased 18% sequentially to 19% of product revenue reflecting our ongoing content expansion and design win initiatives, even though both the automotive and industrial markets continue to undergo inventory and demand adjustments.

“For the fourth quarter, we are guiding revenue to be better than typical seasonality. Our gross margin expectation continues to reflect factory underloading related to our wafer service agreements and internal demand. With sufficient capacity available to support future demand improvements, we took the initiative in the third quarter to moderate our CapEx investments to below our target model. This action combined with our past cost reduction actions will help preserve near-term earnings and cash flow until the recovery accelerates, especially in the higher margin automotive and industrial end markets.”

Third Quarter 2024

Revenue for third quarter 2024 was $350.1 million, compared to $319.8 million in the second quarter 2024 and $404.6 million in the third quarter 2023.

GAAP gross profit for the third quarter 2024 was $118.0 million, or 33.7 percent of revenue, compared to $107.4 million, or 33.6 percent of revenue, in the second quarter 2024 and $155.9 million, or 38.5 percent of revenue, in the third quarter of 2023.

GAAP operating expenses for third quarter 2024 were $96.1 million, or 27.5 percent of revenue, and on a non-GAAP basis were $91.7 million, or 26.2 percent of revenue, which excludes $3.8 million amortization of acquisition-related intangible asset expenses, $0.8 million in acquisition-related costs and a $0.2 million adjustment on restructuring charges. GAAP operating expenses in the second quarter 2024 were $103.7 million, or 32.4 percent of revenue and in the third quarter 2023 were $102.0 million, or 25.2 percent of revenue.

Third quarter 2024 GAAP net income was $13.7 million, or $0.30 per diluted share, compared to GAAP net income in the second quarter 2024 of $8.0 million, or $0.17 per diluted share, and $48.7 million, or $1.05 per diluted share, of GAAP net income in the third quarter 2023.

Third quarter 2024 non-GAAP adjusted net income was $20.1 million, or $0.43 per diluted share, which excluded, net of tax, $3.1 million of acquisition-related intangible asset cost, $2.7 million non-cash mark-to-market investment value adjustment, $0.6 million in acquisition-related costs and a $0.2 million adjustment on restructuring charges. This compares to non-GAAP adjusted net income of $15.4 million, or $0.33 per diluted share, in the second quarter 2024 and $52.5 million, or $1.13 per diluted share, in the third quarter 2023.

The following is an unaudited summary reconciliation of GAAP net income to non-GAAP adjusted net income and per share data, net of tax (in thousands, except per share data):