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Tuesday, Synaptics Incorporated (NASDAQ:SYNA) announced the immediate departure of President and CEO Michael Hurlston, who will take up the CEO position at Lumentum Holdings Inc (NASDAQ:LITE). Following the announcement, Ken Rizvi, currently Synaptics’ CFO, has been appointed as interim CEO. Nelson Chan, the board chairman, will serve as executive chairman during the transition. The company’s board is actively searching for a new CEO, considering both internal and external candidates, and plans to hire an executive search firm to assist in the process. The leadership change comes as Synaptics, currently valued at $3.33 billion, maintains a strong financial position with InvestingPro data showing liquid assets exceeding short-term obligations and a healthy current ratio of 4.49.
Synaptics also provided a financial update, expecting second-quarter revenue to reach $267 million, slightly exceeding its previous forecast of $265 million. The company anticipates its gross margin to align with the midpoint of their guidance at 53.5%, with operating expenses slightly above the midpoint of $96 million. Additionally, earnings per share (EPS) are projected to surpass the midpoint of their guidance of $0.85. According to InvestingPro data, the company has maintained profitability over the last twelve months with a gross margin of 46.31%, while delivering a strong year-to-date return of 11.44%.
KeyBanc analysts have reiterated a Sector Weight rating on Synaptics stock, maintaining their stance on the company’s prospects. The firm expressed surprise at the timing of Hurlston’s departure, especially following the company’s recent extension of the Wi-Fi agreement with Broadcom (NASDAQ:AVGO) and Hurlston’s significant role in Synaptics’ turnaround since he joined in 2019. InvestingPro analysis indicates the stock is currently trading below its Fair Value, with additional insights available in the comprehensive Pro Research Report, which offers deep-dive analysis of Synaptics and 1,400+ other US equities.
The transition in leadership comes at a time when Synaptics has shown resilience and growth potential. The board’s commitment to finding a suitable replacement for Hurlston suggests a focus on maintaining the company’s strategic direction and continued success.
Investors and stakeholders are closely monitoring the developments at Synaptics, as the search for a new CEO begins and the company moves forward with its interim leadership. The financial outlook provided by the company indicates steady performance, with results expected to meet or slightly exceed prior guidance.
In other recent news, Synaptics Incorporated has experienced a series of significant developments. The company announced the immediate resignation of its CEO, Michael Hurlston, who has accepted a new role as CEO at Lumentum Holdings Inc. During this transition period, Synaptics’ CFO, Ken Rizvi, will serve as Interim CEO, and Nelson Chan, Chairman of the Board, will assume the role of Executive Chairman.
In financial terms, Synaptics released preliminary results for the second quarter of fiscal 2025, projecting $267 million in revenue. This figure slightly surpasses the consensus estimate of $265 million. The company also secured additional funding through the issuance of $50 million in aggregate principal amount of 0.75% Convertible Senior Notes due 2031.
On the other hand, Lumentum Holdings Inc. has appointed Michael Hurlston as President and CEO, issuing guidance that exceeded expectations. The company’s preliminary results for the fiscal second quarter of 2025 outperformed previous guidance, with expected net revenue around $402 million and non-GAAP diluted earnings per share between $0.40 and $0.42.
Lastly, Synaptics announced its plan to offer $400 million in convertible senior notes due in 2031 and plans to expand its credit facility from $250 million to $350 million. These strategic moves aim to enhance the company’s financial flexibility.
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