Fourth Quarter Revenues Up 4% Year-over-Year

New Product Revenues Increase 26% Year-over-Year and 48% for Full Year

Fourth Quarter GAAP and Non-GAAP Gross Margins Both Increased 210bp to 45.1% and 45.3%, Respectively

LOS ALTOS, Calif., Feb. 02, 2017 (GLOBE NEWSWIRE) -- DSP Group ®, Inc. (NASDAQ:DSPG), a leading global provider of wireless chipset solutions for converged communications, announced today its results for the fourth quarter and year ended December 31, 2016.

Fourth Quarter Financial Highlights:
  • GAAP and non-GAAP diluted earnings per share of $0.06 and $0.13, respectively.
  • Revenues of $35.3 million, up 4% year-over-year.
  • GAAP and non-GAAP gross margin of 45.1% and 45.3%, respectively, 210 bps improvement, as compared to the fourth quarter of 2015 on both GAAP and non-GAAP basis.
  • GAAP and non-GAAP operating income of $1.1 million and $2.9 million, respectively, reaching 3.1% and 8.2% of revenues, respectively, compared to GAAP operating loss of $0.5 million and non-GAAP operating income of $1.4 million, in the fourth quarter of 2015.
  • GAAP and non-GAAP net income of $1.3 million and $3.0 million, respectively, compared to GAAP net loss of $0.1 million and non-GAAP net income of $1.7 million, in the fourth quarter of 2015.
  • Generated $10.6 million of cash flow from operations compared to $8.3 million in the fourth quarter of 2015.
  • Repurchased approximately 444,000 shares for a total consideration of $4.8 million.
  • Cash, deposits and marketable securities of approximately $125 million as of December 31, 2016.

Full Year 2016 Financial Highlights:
  • GAAP and non-GAAP diluted earnings per share of $0.21 and $0.36, respectively.
  • Revenues of approximately $137.9 million, a decrease of 4% vs. $144.3 million in 2015.
  • GAAP and non-GAAP gross margin of 44.1% and 44.4%, respectively, a 260 and 270 bps improvement, as compared to 2015 on GAAP and non-GAAP basis, respectively.
  • GAAP and non-GAAP operating income of $4.2 million and  $8.2 million, respectively,  reaching 3% and 5.9% of revenues, respectively,  compared to GAAP and non-GAAP operating income of $0.7 million and $7.5 million in 2015.
  • GAAP and non-GAAP net income of $4.8 million and $8.5 million, respectively, compared to GAAP and non-GAAP net income of $1.6 million and $8.0 million in 2015.
  • Generated $16.5 million of cash from operating activities compared to $12.2 million in 2015.
  • Repurchased approximately 1.1 million shares for a total consideration of $10.7 million.

Management Comments:Commenting on the results, Ofer Elyakim, CEO of DSP Group, stated, "We are delighted that in 2016 our new products were well received in the marketplace and strongly contributed to our achievement of record high revenues of $59.3 million, representing an increase of 48% year over year and accounting for 43% of total revenues. Moreover, we are very pleased with our financial performance in which we realized a 270 bps improvement in non-GAAP gross margins and 70 bps improvements in non-GAAP operating margins to 44.4% and 5.9%, respectively, as well as the accomplishment of record cash flow from operations in the amount of $16.5 million."

Mr. Elyakim added, "In the first quarter of 2017, we expect a slowdown in revenues due to a seasonal decrease in demand for our cordless telephony products and a drop in demand for our HDClear products. Looking ahead, we remain very well positioned for long-term growth and profitability due to the strength of our new products strategy."

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