Monolithic Power Systems raises dividend as revenue grows

KIRKLAND, Wash. - Monolithic Power Systems, Inc. (NASDAQ:MPWR), a leading provider of semiconductor-based power electronics solutions, has announced an increase in its quarterly cash dividend and reported its financial results for the fourth quarter and full year ended December 31, 2024. The company maintains a strong financial position with an impressive "GREAT" overall health score according to InvestingPro analysis.

The company’s Board of Directors approved a dividend hike from $1.25 to $1.56 per share, set to be paid on April 15, 2025, to shareholders of record by March 31, 2025. This increase continues MPWR’s impressive track record of raising dividends for 7 consecutive years, with a robust 25% dividend growth rate over the last twelve months. InvestingPro data reveals 12 additional key insights about MPWR’s financial strength and market position.

For the quarter ending December 31, 2024, MPS reported a slight quarterly revenue increase to $621.7 million, up 0.2% from the previous quarter and a substantial 36.9% rise from the same quarter in the previous year. The company’s GAAP gross margin remained stable at 55.4%, consistent with its trailing twelve-month gross profit margin of 55.29%. The company maintains strong liquidity with a current ratio of 6.42, significantly exceeding its short-term obligations.

Operating expenses rose to $181.1 million for the quarter, with non-GAAP operating expenses at $126.1 million after adjustments. GAAP operating income reached $163.3 million, while non-GAAP operating income stood at $220.7 million, excluding various expenses.

The quarter’s GAAP net income was reported at an exceptional $1.4 billion, significantly influenced by the recognition of a $1.3 billion tax benefit granted to a foreign subsidiary. Excluding this tax benefit and other non-GAAP adjustments, net income was $198.4 million, or $4.09 per diluted share.

For the full year, MPS saw revenues climb 21.2% to $2.2 billion. GAAP net income for the year was an impressive $1.8 billion, including the same substantial tax benefit. Non-GAAP net income for the year was $689.8 million, or $14.12 per diluted share, after adjustments.

Revenue growth was seen across various end markets, with significant increases in enterprise data and automotive sectors.

Looking ahead, MPS provided financial targets for the first quarter ending March 31, 2025, projecting revenues between $610.0 million and $630.0 million, GAAP gross margins of 55.1% to 55.7%, and non-GAAP gross margins between 55.4% and 56.0%. Seven analysts have recently revised their earnings estimates upward for the upcoming period, according to InvestingPro data, with price targets ranging from $600 to $1,100 per share. The company’s comprehensive Pro Research Report, available on InvestingPro along with 1,400+ other top stocks, provides detailed analysis of these projections and market positioning.

The company’s financial results and dividend increase reflect its commitment to delivering shareholder value and confidence in its long-term growth strategy. This article is based on a press release statement from Monolithic Power Systems.

In other recent news, Monolithic Power Systems has been the focus of several analyst notes. Rosenblatt Securities maintained a Neutral rating on the company, anticipating fourth-quarter earnings to align with market expectations and projecting revenues of $608 million. On the other hand, Truist Securities adjusted its outlook, reducing the price target to $762 but maintaining a Buy rating.

Citi initiated coverage on Monolithic Power, assigning a Buy rating and a price target of $700, highlighting the company’s consistent sales and earnings growth. Wells Fargo (NYSE:WFC) initiated coverage with an Equal Weight rating, citing concerns over market volatility and the company’s involvement in NVIDIA (NASDAQ:NVDA)’s supply chain. Lastly, Needham revised its price target to $600 due to uncertainties about Monolithic Power’s share position on NVIDIA’s Blackwell platform, but maintained a Buy rating.

These recent developments indicate a variety of perspectives on Monolithic Power’s performance and future prospects. Analysts from different firms have provided their projections and ratings, reflecting the dynamic nature of the semiconductor industry in which Monolithic Power operates.

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