Power Integrations (NASDAQ:POWI) Announces Quarterly Earnings Results

Power Integrations (NASDAQ:POWI) released its quarterly earnings results on Wednesday. The semiconductor company reported $0.46 earnings per share for the quarter, topping analysts’ consensus estimates of $0.42 by $0.04, FiscalAI reports. Power Integrations had a return on equity of 5.50% and a net margin of 5.58%. The company had revenue of $125.48 million during the quarter, compared to analysts’ expectations of $126.03 million. During the same period in the previous year, the firm posted $0.36 earnings per share. The business’s revenue for the quarter was up 5.5% compared to the same quarter last year.

Here are the key takeaways from Power Integrations’ conference call:

• Profitability and cash generation improved: Q3 revenue rose 6% year over year to $125.5 million, while non-GAAP operating margin reached 21.4% and EPS increased 28% year over year. The company also generated $37 million in free cash flow and raised its quarterly dividend.
• Q4 outlook implies continued growth: The company forecast revenue of $118 million to $126 million, with the midpoint representing 18% year-over-year growth, and expects non-GAAP gross margin of about 55%. Management attributed the outlook to industrial strength and recent design wins, while noting softer consumer demand and supply constraints.
• Elevated channel inventory and supply issues remain risks: Channel inventory rose 4.5 weeks to 11.8 weeks amid weak appliance demand, delayed metering projects, and customers’ higher buffer-stock requirements; management expects inventory to remain above target and potentially sit at 9–10 weeks next year. Separately, high-power demand currently exceeds supply, with packaging and PCB constraints limiting the company’s ability to fulfill it.
• GaN and strategic-market opportunities are expanding: Power Integrations reported strong GaN design-win momentum, growing data-center opportunities—including four 800-volt auxiliary-power design-ins expected to enter production in 2027—and a larger automotive pipeline. Management sees potential to double its serviceable addressable market by 2031, though main-path data-center products are expected to roll out in 2028–2029.

Power Integrations Stock Performance

NASDAQ POWI traded down $7.88 during trading hours on Thursday, hitting $38.92. 1,575,455 shares of the company’s stock were exchanged, compared to its average volume of 947,169. The business’s 50 day moving average is $49.49 and its 200-day moving average is $58.61. Power Integrations has a 12-month low of $30.86 and a 12-month high of $91.18. The firm has a market capitalization of $2.17 billion, a P/E ratio of 86.30 and a beta of 1.58.

Power Integrations Dividend Announcement

The firm also recently announced a quarterly dividend, which will be paid on Thursday, December 31st. Investors of record on Monday, November 30th will be given a dividend of $0.2150 per share. The ex-dividend date is Monday, November 30th. This represents a $0.86 annualized dividend and a yield of 2.2%. Power Integrations’s dividend payout ratio is 191.11%.

Key Power Integrations News

Here are the key news stories impacting Power Integrations this week:

• Positive Sentiment: Q3 adjusted earnings were $0.46 per share, above analysts’ roughly $0.42 estimate and up from $0.36 a year earlier. Revenue increased 5.5% year over year to $125.48 million. Management also pointed to improving inventory conditions. Q3 earnings report
• Positive Sentiment: Power Integrations declared a quarterly dividend of $0.215 per share ($0.86 annualized), equivalent to a reported 2.2% yield. Company information
• Positive Sentiment: Susquehanna and Needham lowered their price targets to $55 and $65, respectively, but kept positive and buy ratings. Power Integrations also outlined a goal to double its serviceable addressable market by 2031, offering a longer-term growth opportunity. SAM target and Q4 outlook
• Negative Sentiment: Q3 revenue of $125.48 million narrowly missed the $126.03 million consensus. Q4 revenue guidance of $118 million to $126 million points to a potential sequential slowdown, a likely concern for investors even with the EPS beat. Q4 revenue outlook

Wall Street Analyst Weigh In

A number of analysts recently commented on POWI shares. Williams Trading set a $65.00 price objective on Power Integrations in a research note on Thursday. Needham & Company LLC cut their target price on shares of Power Integrations from $80.00 to $65.00 and set a “buy” rating for the company in a research note on Thursday. Weiss Ratings upgraded shares of Power Integrations from a “sell (d+)” rating to a “hold (c-)” rating in a report on Wednesday, August 19th. Zacks Research lowered shares of Power Integrations from a “strong-buy” rating to a “hold” rating in a report on Monday, July 20th. Finally, Wall Street Zen raised shares of Power Integrations from a “hold” rating to a “buy” rating in a research note on Saturday, August 8th. Four equities research analysts have rated the stock with a Buy rating and four have issued a Hold rating to the company. According to data from MarketBeat, Power Integrations has a consensus rating of “Moderate Buy” and an average target price of $59.67.

Power Integrations Company Profile

Power Integrations, Inc designs and manufactures high-performance semiconductor technologies used in energy-efficient power conversion. Its products help convert and control electrical power in applications such as consumer electronics, appliances, industrial equipment, communications infrastructure, renewable-energy systems, and electric vehicles.

The company’s product portfolio includes integrated circuits for AC-to-DC and DC-to-DC power supplies, LED lighting drivers, power-factor correction, motor drives, and high-voltage gate driving.