Alpha and Omega Semiconductor Reports Financial Results for the

Alpha and Omega Semiconductor Reports Financial Results for the Fiscal First Quarter of 2023 Ended September 30, 2022

About Alpha and Omega Semiconductor

Alpha and Omega Semiconductor Limited, or AOS, is a designer, developer and global supplier of a broad range of power semiconductors, including a wide portfolio of Power MOSFET, IGBT, IPM, TVS, HVIC, GaN/SiC, Power IC and Digital Power products. AOS has developed extensive intellectual property and technical knowledge that encompasses the latest advancements in the power semiconductor industry, which enables us to introduce innovative products to address the increasingly complex power requirements of advanced electronics. AOS differentiates itself by integrating its Discrete and IC semiconductor process technology, product design, and advanced packaging know-how to develop high performance power management solutions. AOS’ portfolio of products targets high-volume applications, including personal and portable computers, graphic cards, flat panel TVs, home appliances, smart phones, battery packs, quick chargers, home appliances, consumer and industrial motor controls and power supplies for TVs, computers, servers and telecommunications equipment. For more information, please visit www.aosmd.com.

The following unaudited condensed consolidated financial statements are prepared in accordance with U.S. GAAP.

Condensed Consolidated Statements of Operations
(in thousands, except percentages and per share amounts)
(unaudited)

	Three Months Ended
	September 30, 2022			June 30, 2022			September 30, 2021

Revenue	$	208,476		$	193,959		$	187,035
Cost of goods sold		137,348			130,737			122,468
Gross profit		71,128			63,222			64,567
Gross margin		34.1	%		32.6	%		34.5	%

Operating expenses:
Research and development		21,389			20,386			17,812
Selling, general and administrative		24,205			24,696			21,806
Total operating expenses		45,594			45,082			39,618
Operating income		25,534			18,140			24,949

Other income (loss), net		(16	)		279			(16	)
Interest expense, net		(608	)		(895	)		(2,176	)
Net income before income taxes		24,910			17,524			22,757

Income tax expense		1,374			940			1,320
Net income before income (loss) from equity method investment		23,536			16,584			21,437
Equity method investment income (loss) from equity investee		2,502			(1,493	)		—
Net income		26,038			15,091			21,437
Net loss attributable to noncontrolling interest		—			—			(1,987	)
Net income attributable to Alpha and Omega Semiconductor Limited	$	26,038		$	15,091		$	23,424

Net income per common share attributable to Alpha and Omega Semiconductor Limited
Basic	$	0.95		$	0.55		$	0.89
Diluted	$	0.88		$	0.53		$	0.85

Weighted average number of common shares attributable to Alpha and Omega Semiconductor Limited used to compute net income per share
Basic		27,391			27,269			26,365
Diluted		29,423			28,466			27,638

Alpha and Omega Semiconductor Limited
Condensed Consolidated Balance Sheets
(in thousands, except par value per share)
(unaudited)
	September 30, 2022			June 30, 2022
ASSETS
Current assets:
Cash and cash equivalents	$	316,119		$	314,352
Restricted cash		278			299
Accounts receivable, net		55,769			65,681
Inventories		164,946			158,040
Other current assets		11,030			11,220
Total current assets		548,142			549,592
Property, plant and equipment, net		339,470			318,666
Operating lease right-of-use assets		24,251			23,674
Intangible assets, net		9,211			10,050
Equity method investment		375,914			378,378
Deferred income tax assets		553			592
Other long-term assets		13,897			17,677
Total assets	$	1,311,438		$	1,298,629
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	80,101		$	87,377
Accrued liabilities		108,350			116,893
Payable related to equity investee, net		19,516			28,989
Income taxes payable		4,687			4,248
Short-term debt		26,738			25,563
Finance lease liabilities		820			802
Operating lease liabilities		4,119			3,850
Total current liabilities		244,331			267,722
Long-term debt		46,953			42,486
Income taxes payable - long-term		2,191			2,158
Deferred income tax liabilities		28,572			28,757
Finance lease liabilities - long-term		3,873			3,932
Operating lease liabilities - long-term		20,748			20,878
Other long-term liabilities		79,301			78,603
Total liabilities		425,969			444,536
Equity:
Preferred shares, par value $0.002 per share:
Authorized: 10,000 shares; issued and outstanding: none at September 30, 2022 and June 30, 2022		—			—
Common shares, par value $0.002 per share:
Authorized: 100,000 shares; issued and outstanding: 34,018 shares and 27,401 shares, respectively at September 30, 2022 and 33,988 shares and 27,371 shares, respectively at June 30, 2022		68			68
Treasury shares at cost: 6,617 shares at September 30, 2022 and 6,617 shares at June 30, 2022		(65,996	)		(66,000	)
Additional paid-in capital		299,196			288,951
Accumulated other comprehensive income		(3,827	)		1,080
Retained earnings		656,028			629,994
Total equity		885,469			854,093
Total liabilities and equity	$	1,311,438		$	1,298,629

Alpha and Omega Semiconductor Limited
Reconciliation of Condensed Consolidated GAAP Financial Measures to Non-GAAP Financial Measures
(in thousands, except percentages and per share data)
(unaudited)

	Three Months Ended
	September 30, 2022			June 30, 2022			September 30, 2021

GAAP gross profit	$	71,128		$	63,222		$	64,567
Share-based compensation		1,788			1,565			569
Amortization of purchased intangible		812			811			812
Non-GAAP gross profit	$	73,728		$	65,598		$	65,948
Non-GAAP gross margin as a % of revenue		35.4	%		33.8	%		35.3	%

GAAP operating expense	$	45,594		$	45,082		$	39,618
Share-based compensation		8,808			8,305			4,066
Legal costs related to government investigation		142			84			431
Non-GAAP operating expense	$	36,644		$	36,693		$	35,121

GAAP operating income	$	25,534		$	18,140		$	24,949
Share-based compensation		10,596			9,870			4,635
Amortization of purchased intangible		812			811			812
Legal costs related to government investigation		142			84			431
Non-GAAP operating income	$	37,084		$	28,905		$	30,827
Non-GAAP operating margin as a % of revenue		17.8	%		14.9	%		16.5	%

GAAP net income attributable to AOS	$	26,038		$	15,091		$	23,424
Share-based compensation		10,596			9,870			4,635
Amortization of purchased intangible		812			811			812
Equity method investment loss (income) from equity investee		(2,502	)		1,493			—
Legal costs related to government investigation		142			84			431
Income tax effect of non-GAAP adjustments		119			(234	)		1
Non-GAAP net income attributable to AOS	$	35,205		$	27,115		$	29,303
Non-GAAP net margin attributable to AOS as a % of revenue		16.9	%		14.0	%		15.7	%

GAAP net income attributable to AOS	$	26,038		$	15,091		$	23,424
Share-based compensation		10,596			9,870			4,635
Amortization and depreciation		9,352			8,588			13,722
Equity method investment loss (income) from equity investee		(2,502	)		1,493			—
Interest expense, net		608			895			2,176
Income tax expense		1,374			940			1,320
EBITDAS	$	45,466		$	36,877		$	45,277

GAAP diluted net income per share attributable to AOS	$	0.88		$	0.53		$	0.85
Share-based compensation		0.36			0.35			0.16
Amortization of purchased intangible		0.03			0.03			0.03
Equity method investment loss (income) from equity investee		(0.09	)		0.05			—
Legal costs related to government investigation		0.01			0.00			0.02
Income tax effect of non-GAAP adjustments		0.01			(0.01	)		0.00
Non-GAAP diluted net income per share attributable to AOS	$	1.20		$	0.95		$	1.06

Shares used to compute GAAP diluted net income per share		29,423			28,466			27,638
Shares used to compute Non-GAAP diluted net income per share		29,423			28,466			27,638

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