– Full Year 2024 Sales Increase 8% to a Record $1.05 Billion ––38% Growth in E-Mobility Drives 17% Year-over-Year Increase in Full Year 2024 Automotive Sales – MANCHESTER, N.H., May 09, 2024 (GLOBE NEWSWIRE) -- Allegro MicroSystems, Inc. ("Allegro" or the "Company") (NASDAQ:ALGM), a global leader in power and sensing semiconductor solutions for motion control and energy efficient systems, today announced financial results for its fourth quarter and full year ended March 29, 2024. "Continued strong momentum in e-Mobility drove record fiscal year 2024 sales to more than $1 billion and record non-GAAP earnings per share of $1.35. We also achieved a record level of design wins of more than $1 billion. I would like to thank the entire Allegro team for their contributions which enabled us to achieve these significant milestones," said Vineet Nargolwala, President and CEO of Allegro. "During fiscal year 2024, we strengthened our market-leading positions in magnetic sensing and power solutions with the addition of highly differentiated TMR technology to our portfolio and introduction of high voltage isolated gate drivers to the market, enabling us to continue to deliver innovative, high-value solutions to our customers. As we look ahead into fiscal year 2025, our first quarter guide comprehends working closely with customers to manage orders to reduce inventory in the channel and return to normalized business levels. We continue to expect a return to sequential growth in the second quarter. Our design wins and continued momentum with customers gives us confidence in the mid and longer-term growth trajectory." Fourth Quarter and Full Fiscal Year 2024 Financial Highlights: In thousands, except per share data   Three-Month Period Ended     Twelve-Month Period Ended       March 29,2024     December 29,2023     March 31,2023*     March 29,2024     March 31,2023*       (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)   Net Sales                               Automotive   $ 181,939     $ 194,764     $ 178,802     $ 759,454     $ 646,761   Industrial     43,789       45,949       61,807       223,810       208,604   Other     14,853       14,271       28,836       66,103       118,288   Total net sales   $ 240,581     $ 254,984     $ 269,445     $ 1,049,367     $ 973,653   GAAP Financial Measures                               Gross margin %     51.2 %     52.5 %     56.8 %     54.8 %     56.1 % Operating margin %     6.6 %     14.4 %     23.4 %     18.7 %     20.9 % Diluted EPS   $ (0.04 )   $ 0.17     $ 0.32     $ 0.78     $ 0.97   Non-GAAP Financial Measures                               Gross margin %     53.8 %     54.6 %     57.8 %     56.3 %     56.8 % Operating margin %     23.8 %     27.2 %     30.2 %     28.5 %     28.6 % Diluted EPS   $ 0.25     $ 0.32     $ 0.37     $ 1.35     $ 1.28   *During the preparation of the third quarter fiscal year 2024 interim condensed consolidated financial statements, the Company identified an immaterial error in the classification of net sales by application with the table above, whereby customer returns and sales allowances were incorrectly classified by application between Automotive, Industrial and Other in the prior periods presented above. There was no impact to previously reported total net sales or net income in any of the periods noted above. Business Outlook For the first quarter of fiscal year 2025 ending June 28, 2024, the Company expects net sales to be in the range of $160 million to $170 million. The Company also estimates the following results on a non-GAAP basis: Gross Margin is expected to be between 49% and 50%, Operating Expenses are expected to be between $72 and $73 million, and Diluted Earnings per Share are expected to be in the range of $0.01 to $0.03. The Company also made a $50 million voluntary payment on its term loan, which is expected to reduce annualized interest expense by approximately $4 million dollars. Allegro has not provided a reconciliation of its first fiscal quarter outlook for non-GAAP Gross Margin, non-GAAP Operating Expenses, and non-GAAP Diluted Earnings per Share because estimates of all of the reconciling items cannot be provided without unreasonable efforts. It is difficult to reasonably provide a forward-looking estimate between such forward-looking non-GAAP measures and the comparable forward-looking U.S. generally accepted accounting principles ("GAAP") measures. Certain factors that are materially significant to Allegro's ability to estimate these items are out of its control and/or cannot be reasonably predicted. Earnings Webcast A webcast will be held on Thursday, May 9, 2024 at 8:30 a.m., Eastern Time. Vineet Nargolwala, President and Chief Executive Officer, will discuss Allegro's business and financial results. The webcast will be available on the Investor Relations section of the Company's website at investors.allegromicro.com. A recording of the webcast will be posted in the same location shortly after the call concludes and will be available for at least 90 days. About Allegro MicroSystems Allegro MicroSystems is a leading global designer, developer, fabless manufacturer and marketer of sensor integrated circuits ("ICs") and application-specific analog power ICs enabling emerging technologies in the automotive and industrial markets. Allegro's diverse product portfolio provides efficient and reliable solutions for the electrification of vehicles, automotive ADAS safety features, automation for Industry 4.0 and power saving technologies for data centers and clean energy applications. Forward-Looking Statements This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, contained in this press release including statements regarding our future results of operations and financial position, business strategy, prospective products and the plans and objectives of management for future operations, including, among others, statements regarding the liquidity, growth and profitability strategies and factors affecting our business, are forward-looking statements. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Without limiting the foregoing, in some cases, you can identify forward-looking statements by terms such as "aim," "may," "will," "should," "expect," "exploring," "plan," "anticipate," "could," "intend," "target," "project," "would," "contemplate," "believe," "estimate," "predict," "potential," "seek," or "continue" or the negative of these terms or other similar expressions, although not all forward-looking statements contain these words. No forward-looking statement is a guarantee of future results, performance or achievements, and one should avoid placing undue reliance on such statements. Forward-looking statements are based on our management's current expectations, beliefs and assumptions and on information currently available to us. Such beliefs and assumptions may or may not prove to be correct. Additionally, such forward-looking statements are subject to a number of known and unknown risks, uncertainties and assumptions, and actual results may differ materially from those expressed or implied in the forward-looking statements due to various factors, including, but not limited to, those identified in Part II, Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations," and Part I, Item 1A. "Risk Factors" in our Annual Report on Form 10-K for the year ended March 31, 2023, as updated in Part II, Item 1A "Risk Factors" of our Quarterly Report on Form 10-Q for the quarterly period ended December 29, 2023, filed with the Securities and Exchange ("SEC") on February 6, 2024. These risks and uncertainties include, but are not limited to: downturns or volatility in general economic conditions; our ability to compete effectively, expand our market share and increase our net sales and profitability; our reliance on a limited number of third-party semiconductor wafer fabrication facilities and suppliers of other materials; our failure to adjust purchase commitments and inventory management based on changing market conditions or customer demand; shifts in our product mix or customer mix, which could negatively impact our gross margin; the risk that the expected benefits of acquisitions may not be realized or that integration of acquired businesses may not continue as rapidly as we anticipate; the cyclical nature of the analog semiconductor industry; any downturn or disruption in the automotive market; our ability to compensate for decreases in average selling prices of our products and increases in input costs; our ability to manage any sustained yield problems or other delays at our third-party wafer fabrication facilities or in the final assembly and test of our products; our ability to accurately predict our quarterly net sales and operating results; our ability to adjust our supply chain volume to account for changing market conditions and customer demand; our dependence on manufacturing operations in the Philippines; our reliance on distributors to generate sales; the effects of COVID-19 on our supply chain and customer demand; our ability to develop new product features or new products in a timely and cost-effective manner; our ability to manage growth; any slowdown in the growth of our end markets; the loss of one or more significant customers; our ability to meet customers' quality requirements; uncertainties related to the design win process and our ability to recover design and development expenses and to generate timely or sufficient net sales or margins; changes in government trade policies, including the imposition of export restrictions and tariffs; our exposures to warranty claims, product liability claims and product recalls; our dependence on international customers and operations; the availability of rebates, tax credits and other financial incentives on end-user demands for certain products; risks, liabilities, costs and obligations related to governmental regulation and other legal obligations, including export control, privacy, data protection, information security, consumer protection, environmental and occupational health and safety, anti-corruption and anti-bribery, and trade controls; the volatility of currency exchange rates; our ability to raise capital to support our growth strategy; our indebtedness may limit our flexibility to operate our business; our ability to effectively manage our growth and to retain key and highly skilled personnel; our ability to protect our proprietary technology and inventions through patents or trade secrets; our ability to commercialize our products without infringing third-party intellectual property rights; disruptions or breaches of our information technology systems or those of our third-party service providers; our principal stockholders have substantial control over us; the inapplicability of the "corporate opportunity" doctrine to any director or stockholder who is not employed by us; anti-takeover provisions in our organizational documents and under the General Corporation Law of the State of Delaware; our inability to design, implement or maintain effective internal control over financial reporting; changes in tax rates or the adoption of new tax legislation; the negative impacts of sustained inflation on our business; disruptions in the banking and financial sector that limit our or our partners' ability to access capital and borrowings; the physical, transition and litigation risks presented by climate change; and other events beyond our control. Moreover, we operate in an evolving environment. New risk factors and uncertainties may emerge from time to time, and it is not possible for management to predict all risk factors and uncertainties. You should read this press release and the documents that we reference completely and with the understanding that our actual future results may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements. All forward-looking statements speak only as of the date of this press release, and except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements, whether as a result of any new information, future events, changed circumstances or otherwise. This press release includes certain non-GAAP financial measures as defined by the SEC rules. These non-GAAP financial measures are provided in addition to, and not as a substitute for or superior to measures of, financial performance prepared in accordance with GAAP. There are a number of limitations related to the use of these non-GAAP financial measures versus their nearest GAAP equivalents. For example, other companies may calculate non-GAAP financial measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of the presented non-GAAP financial measures as tools for comparison. This press release may not be reproduced, forwarded to any person or published, in whole or in part. ALLEGRO MICROSYSTEMS, INC. CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (in thousands, except share and per share amounts) (Unaudited)     Three-Month Period Ended     Twelve-Month Period Ended       March 29,2024     March 31,2023     March 29,2024     March 31,2023   Net sales   $ 240,581     $ 269,445     $ 1,049,367     $ 973,653   Cost of goods sold     117,333       116,356       474,838       427,574   Gross profit     123,248       153,089       574,529       546,079   Operating expenses:                         Research and development     45,839       41,833       176,638       150,850   Selling, general and administrative     48,294       48,152       188,429       191,922   Impairment of long-lived assets     13,218       —       13,218       —   Total operating expenses     107,351       89,985       378,285       342,772   Operating income     15,897       63,104       196,244       203,307   Interest and other income (expense)     1,354       4,817       (1,447 )     8,039   Income before income taxes     17,251       67,921       194,797       211,346   Income tax provision     24,325       5,909       41,909       23,852   Net (loss) income     (7,074 )     62,012       152,888       187,494   Net income attributable to non-controlling interests     41       35       191       137   Net (loss) income attributable to Allegro MicroSystems, Inc.   $ (7,115 )   $ 61,977     $ 152,697     $ 187,357   Net (loss) income per common share attributable to Allegro MicroSystems, Inc.:                         Basic   $ (0.04 )   $ 0.32     $ 0.79     $ 0.98   Diluted   $ (0.04 )   $ 0.32     $ 0.78     $ 0.97   Weighted average shares outstanding:                         Basic     193,139,519       191,519,850       192,573,169       191,197,452   Diluted     194,487,307       194,993,241       194,674,352       193,688,102   Supplemental Schedule of Total Net Sales The following table summarizes total net sales by market within the Company's unaudited consolidated statements of operations:     Three-Month Period Ended     Change     Twelve-Month Period Ended     Change       March 29,2024     March 31,2023     Amount     %     March 29,2024     March 31,2023     Amount     %       (Dollars in thousands)     (Dollars in thousands)   Automotive   $ 181,939     $ 178,802     $ 3,137       2 %   $ 759,454     $ 646,761     $ 112,693       17 % Industrial     43,789       61,807       (18,018 )     (29 )%     223,810       208,604       15,206       7 % Other     14,853       28,836       (13,983 )     (48 )%     66,103       118,288       (52,185 )     (44 )% Total net sales   $ 240,581     $ 269,445     $ (28,864 )     (11 )%   $ 1,049,367     $ 973,653     $ 75,714       8 %   ALLEGRO MICROSYSTEMS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except share and per share amounts)       March 29,     March 31,       2024 (Unaudited)     2023   Assets             Current assets:             Cash and cash equivalents   $ 212,143     $ 351,576   Restricted cash     10,018       7,129   Trade accounts receivable, net     118,508       111,290   Trade and other accounts receivable due from related party     207       13,494   Inventories     162,302       151,301   Prepaid expenses and other current assets     65,285       27,289   Current portion of related party note receivable     3,750       3,750   Total current assets     572,213       665,829   Property, plant and equipment, net     321,175       263,099   Deferred income tax assets     54,496       50,359   Goodwill     202,425       27,691   Intangible assets, net     276,854       52,378   Related party note receivable, less current portion     4,688       8,438   Equity investment in related party     26,727       27,265   Other assets     72,025       86,096   Total assets   $ 1,530,603     $ 1,181,155   Liabilities, Non-Controlling Interests and Stockholders' Equity             Current liabilities:             Trade accounts payable   $ 35,964     $ 56,256   Amount due to related party     1,626       9,682   Accrued expenses and other current liabilities     76,389       99,387   Current portion of long-term debt     3,929       —   Total current liabilities     117,908       165,325   Long-term debt     249,611       25,000   Other long-term liabilities     31,368       24,015   Total liabilities     398,887       214,340   Commitments and contingencies             Stockholders' Equity:             Preferred stock     —       —   Common stock     1,932       1,918   Additional paid-in capital     694,332       674,179   Retained earnings     463,012       310,315   Accumulated other comprehensive loss     (28,841 )     (20,784 ) Equity attributable to Allegro MicroSystems, Inc.     1,130,435       965,628   Non-controlling interests     1,281       1,187   Total stockholders' equity     1,131,716       966,815   Total liabilities, non-controlling interests and stockholders' equity   $ 1,530,603     $ 1,181,155       ALLEGRO MICROSYSTEMS, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (Unaudited)           Three Months Ended     Twelve Months Ended       March 29,2024     March 31,2023