MACOM Technology Solutions Holdings, Inc. (NASDAQ:MTSI) Q2 2023 Results Conference Call May 4, 2023 8:30 AM ET

Company Participants

Steve Ferranti - VP, Strategic Initiatives and IR

Steve Daly - President and CEO

Jack Kober - CFO

Conference Call Participants

Matt Ramsay - Cowen

Tom O’Malley - Barclays

Harsh Kumar - Piper Sandler

Quinn Bolton - Needham & Company

Tore Svanberg - Stifel

David Williams - Benchmark

Karl Ackerman - BNP Paribas

Operator

Welcome to MACOM’s Second Fiscal Quarter 2023 Conference Call. This call is being recorded today, Thursday, May 4, 2023. [Operator Instructions]

I will now turn the call to Mr. Steve Ferranti, MACOM’s Vice President of Strategic Initiatives and Investor Relations. Mr. Ferranti, please go ahead.

Steve Ferranti

Thank you, Olivia. Good morning, and welcome to our call to discuss MACOM’s financial results for the second fiscal quarter of 2023. I would like to remind everyone that our discussion today will contain forward-looking statements, which are subject to certain risks and uncertainties as defined in the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those discussed today. For more detailed discussions of the risks and uncertainties that could result in those differences, we refer you to MACOM’s filings with the SEC. Management’s statements during this call will also include discussion of certain adjusted non-GAAP financial information.

A reconciliation of GAAP to adjusted non-GAAP results are provided in the company’s press release and related Form 8-K, which was filed with the SEC today. And with that, I’ll turn over the call to Steve Daly, President and CEO of MACOM.

Steve Daly

Thank you, and good morning.

I will begin today’s call with a general update. After that, Jack Kober, our Chief Financial Officer, will provide a more in-depth review of our results for the second quarter of fiscal 2023. When Jack is finished, I will provide revenue and earnings guidance for our third fiscal quarter, and then we will be happy to take some questions. Revenue for our second quarter of fiscal 2023 was $169.4 million and adjusted EPS was $0.79 per diluted share. Cash flow from operations was approximately $33 million, and we ended the quarter with $577 million in cash in short-term investments on our balance sheet.

Overall, our team did an excellent job on execution to meet our business and financial targets. Our book-to-bill ratio for Q2 was 0.5, which was well below our expectations. In our turns business, or revenue booked and shipped within the quarter, was approximately 9% of our total revenue, also lower than expected. Despite the weak Q2 bookings, our backlog remains strong as 7 of the 9 past quarters have had greater than 1 book-to-bill ratios and our book-to-bill ratio for the full year FY ‘22 was 1.1.