Don't look now, but Cirrus Logic
Cirrus reported its own first quarter of fiscal year 2011 last night, too. Sales shot up an amazing 118% year-over-year to $81.9 million, driven mostly by portable audio chips. One customer -- most likely Apple -- contributed 34% of Cirrus' revenue, and that ratio is expected to build into the next quarter as Apple builds out inventory levels ahead of the coming holiday rush. In other words, Cirrus will have an even better quarter the next time around.
The company's margins are expanding because of economies of scale kicking in, and non-GAAP earnings puffed up from a penny loss last year to a $0.29-per-share gain. Those Apple-bound audio chips are recognized as the main driver of Cirrus' growth, but a slew of fresh audio products for other customers also look promising today and the energy management portfolio is pulling its weight.
CEO Jason Rhode can't imagine the gravy train derailing anytime soon: "With a great second quarter ahead of us, and our newly released products being very well received by customers, we believe that the future for Cirrus Logic remains very bright."
The stock is up 5% today on a generally flat market day, and it has nearly quadrupled in value over the last year. If you were lucky (or wise) enough to buy this stock at the very bottom in late January 2009, you'd have eight times the money today. That’s a return reminiscent of some of the smaller firms left for dead in the oil, gas, and energy market.
Cirrus is looking to build off its Apple success and expand to other brands and other audio-equipped gadgets. I wouldn't be surprised to see these chips quietly trickling into Blu-ray players, TV sets, and portable music players from Sony
It all started with landing Cirrus chips in the iPod. Thanks, Apple; Cirrus will stick with you for years to come.