indie Semiconductor executives take pay cut, company announces layoffs

ALISO VIEJO, CA—indie Semiconductor, Inc., a company specializing in semiconductors and related devices, announced a significant reduction in executive compensation and a workforce reduction plan. The changes, which were detailed in a recent SEC filing, are part of the company's efforts to improve operational efficiencies.

On August 29, 2024, indie Semiconductor's Compensation Committee approved a temporary salary reduction for several top executives, including Chief Executive Officer Donald McClymont and President Dr. Ichiro Aoki, as well as two other founders and Thomas Schiller, Chief Financial Officer and Executive Vice President, Strategy.

At their own initiation and request, each of these executives will receive a nominal annual base salary of $1 for the period from September 1, 2024, through March 31, 2025. Raja Bal, acting Chief Financial Officer and Chief Accounting Officer, along with other members of the executive management, will see their base salaries reduced by 20% for the same period.

Despite the pay cuts, the affected executives will remain eligible to participate in the company's bonus incentive program, and any severance or other benefits will be calculated based on their base salaries prior to the reduction.

In addition to the salary reductions, indie Semiconductor initiated a workforce reduction plan in late August 2024, impacting approximately 50 employees. This move is part of a broader strategy to streamline operations while continuing to invest in areas of the business that are key to growth.

The company, which trades on The Nasdaq Stock Market LLC under the ticker symbol NASDAQ:INDI, has not specified which positions or departments are affected by the layoffs. However, it is clear that indie Semiconductor is taking steps to manage its resources more efficiently in a challenging economic environment.

The information reported is based on indie Semiconductor's recent SEC filing.

In other recent news, Indie Semiconductor reported Q2 2024 revenues of $52.4 million, reflecting broader market trends. Despite facing global economic challenges and a decrease in semiconductor content in vehicles, the company anticipates modest revenue growth in Q3 2024 and aims to resume its leading growth trajectory by 2025.

The company's unique position with all four key ADAS sensors, alongside recent design wins and partnerships with major global OEMs, underscores this confidence.

For Q2, the non-GAAP gross margin stood at 50.3%, with a net loss of $0.09 per share. Looking ahead, Indie Semiconductor projects maintaining its gross margin around 50% and estimates operating expenses to be around $44 million in Q3.

The company's radar wins with Bosch and Ficosa are on track to ramp up next year. Despite production delays due to macroeconomic conditions, Indie has not lost any designs and expects sequential quarterly growth in the latter half of 2024 and into 2025.

InvestingPro Insights

Amidst indie Semiconductor's strategic adjustments, InvestingPro data and tips provide a broader context for understanding the company's market position. The company's market capitalization stands at approximately $819.28 million, reflecting its scale in the semiconductor industry. However, with a negative P/E ratio of -8.04 and an adjusted P/E ratio for the last twelve months as of Q2 2024 at -7.67, investors are likely cautious as these figures suggest the company is not currently generating profits relative to its share price.

Moreover, the company's revenue has grown significantly by 51.23% over the last twelve months as of Q2 2024, indicating a robust top-line expansion. Nonetheless, this growth contrasts with the company's gross profit margin, which is in negative territory at -26.93%, underscoring the challenges indie Semiconductor faces in converting sales into actual profit. These figures are particularly relevant in light of recent operational efficiency measures.

InvestingPro Tips highlight several areas of concern for investors. Analysts have revised their earnings expectations downwards for the upcoming period, and there is a consensus that the company will not be profitable this year. Additionally, the stock has experienced a notable decline over the last six months, with a 39.5% drop in price total return. Despite these challenges, the company’s liquid assets do exceed short-term obligations, which may provide some financial flexibility in the near term. For investors seeking a deeper dive into indie Semiconductor's financial health and future prospects, there are 9 additional InvestingPro Tips available at Investing.com/pro/INDI.

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