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May 28, 2021

SMART Q3 2021 Earnings Report

SMART Global Holdings reported record quarterly net sales and surpassed non-GAAP gross margin and EPS guidance.

Key Takeaways

SMART Global Holdings reported a 56% increase in GAAP net sales compared to the same period last year, reaching $437.7 million. Non-GAAP net income was $35.5 million, or $1.39 per diluted share, up 107.6% and 98.6%, respectively, compared to the same period last year. GAAP net loss was ($7.2) million, or ($0.30) per diluted share.

Set a quarterly revenue record for the company.

Surpassed non-GAAP gross margin and EPS guidance.

Cree LED achieved strong results in its first quarter as part of the SGH family.

Top line growth in Intelligent Platform Solutions Group and strong operating performance in Memory Solutions Group reinforced benefits of growth and diversification strategy.

Total Revenue
$438M
Previous year: $281M
+55.6%
EPS
$0.7
Previous year: $0.35
+100.0%
Adjusted EBITDA
$51.4M
Non-GAAP Gross Margin
21.9%
Gross Profit
$84.5M
Previous year: $54.2M
+55.9%
Cash and Equivalents
$189M
Previous year: $132M
+43.3%
Free Cash Flow
$44.1M
Previous year: $6.11M
+622.6%
Total Assets
$1.19B
Previous year: $792M
+50.1%

SMART

SMART

Forward Guidance

SGH is providing the following financial outlook for its fourth quarter of fiscal 2021:

Positive Outlook

  • Net Sales $440 to $480 million
  • Gross Margin - GAAP / Non-GAAP 22% to 24%
  • Diluted EPS - GAAP $0.95 ± $0.15
  • Diluted EPS - Non-GAAP $1.60 ± $0.15
  • Expected diluted share count - GAAP 27 million

Challenges Ahead

  • Share-based compensation per share $0.33
  • Intangible amortization per share $0.24
  • Convertible debt discount OID and fees per share $0.08
  • Capped call anti-dilution related to convertible (1 million)
  • Expected diluted share count - Non-GAAP 26 million