SiTime Corp. Q1 FY2025 earnings call

• SiTime is a leader in precision timing, which is crucial for modern electronics across various sectors like AI, datacenters, etc. Q1 2025 was strong with revenue 83% higher y-o-y, gross margins 57.4%, and EPS $0.26 per share. - Growth was driven by all segments; CED business tripled y-o-y and other segments grew double-digit. Revenue from largest customer grew over 75%. - CED business has shown sequential growth for four quarters due to AI, with OEM and Cloud Service Provider customers reaffirming growth. Data center business expected to continue growing in 2025 with trends like optical module/switch bandwidth doubling and AECs replacing passive cables. - Clocking business is a key strategy, with new clocking products launched like Cascade, Chorus, and Symphonic, offering increased performance and simplified designs. - Beth Howe discussed Q1 financial results: revenue $60.3M, up 83% y-o-y; gross margins 57.4%; non-GAAP operating income $2.1M; balance sheet details including accounts receivable, inventory, cash from operations, and CapEx.

In Q1 2025, SiTime's revenue was $60.3 million, which was 83% higher than the year ago. The communications, enterprise, data center (CED) segment had revenue of $29.3 million, representing 49% of total revenue and tripling year-over-year. The automotive, industrial, and defense segment had revenue of $14.1 million, making up 23% of total revenue and growing double-digit. The mobile, IoT, and consumer segment had revenue of $16.9 million, accounting for 28% of total revenue and growing double-digit. Gross margins were 57.4%, and non-GAAP net income was $6.3 million or $0.26 per share.

• Q2 2025 revenue expected to grow 45%-50% y-o-y, midpoint $64.7M. - Gross margins approximately flat compared with Q1. - Operating expenses in range of $33M-$33.5M. - Interest income approximately $3M-$3.4M. - Q2 non-GAAP EPS expected in range of $0.25-$0.31 per share. - Full year 2025 expected to have 25%-30% growth, driven by differentiated products, broad product portfolio, and strong design win funnel.

• Uncertainties in macro conditions, including potential impact of tariffs on consumer products. - The new consumer business, while contributing incremental revenue, puts pressure on gross margin rate as it comes at lower gross margins.

Q: Quinn Bolton asked about the growth of the largest customer and margin outlook.

A: Rajesh Vashist said growth should continue but consumer products can be more cyclical; Beth Howe mentioned remaining committed to 60% gross margin target but new consumer business puts pressure on rate.

Q: Tore Svanberg asked about data center growth profile.

A: Rajesh Vashist said growth is strong with opportunities in switches, server racks, GPUs, etc., and no slowdown expected in AI data center market.

Q: Chris Caso asked about full year outlook and data center trends.

A: Rajesh Vashist reaffirmed 25%-30% growth; Beth Howe talked about levers to improve cost structure; Rajesh Vashist discussed dollar content, number of design wins, penetration, and architecture changes in data center.

Q: Suji Desilva asked about product platforms Cascade, Chorus, Symphonic.

A: Rajesh Vashist explained each platform's focus: Cascade in CED, Chorus in automotive, Symphonic in 5G millimeter wave and industrial applications.

Q: Tore Svanberg asked about telecom 5G market and CapEx.

A: Rajesh Vashist said telecom 5G market is starting to move; Beth Howe said CapEx has been around $15-16M and expected to be at elevated levels for some time with full year CapEx mid- to high 30s.