Synaptics Inc. (NASDAQ:SYNA) Q2 2019 Earnings Conference Call Transcript

Feb 07, 2019 • 05:00 pm ET

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Synaptics Inc. (NASDAQ:SYNA) Q2 2019 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Ladies and gentlemen please stand by we're about to begin. Good day and welcome to the Synaptics' Second Quarter Fiscal Quarter 2019 Conference Call. Today's conference is being recorded. At this time I'd like to turn the conference over to Ms. Jennifer Jarman of the Blueshirt Group. Please go ahead.

Executive
Jennifer Jarman

Thanks very much, Stephanie. Good afternoon and thank you for joining us today on Synaptics' Second Quarter Fiscal 2019 Conference Call. With me on today's call are Rick Bergman, President and CEO; Kermit Nolan newly named Interim CFO; and Wajid Ali, outgoing CFO as announced in this afternoon's press release. This call is also being broadcast live over the web and can be accessed from the Investor Relations section of the company's website at synaptics.com.

A quick reminder that we have posted a supplemental slide presentation on our Investor Relations website. The supplementary slides have also been furnished as an exhibit to our current report on Form 8-K filed with the SEC earlier today and add additional color on our financial results. In addition to the company's GAAP results, management will also provide supplementary results on a non-GAAP basis which excludes share-based compensation, acquisition-related costs and certain other non-cash or recurring or non-recurring items. Please refer to the press release issued after market close today for a detailed reconciliation of GAAP and non-GAAP results.

Additionally, we would like to remind you that during the course of this conference call, Synaptics will make forward-looking statements. Forward-looking statements give our current expectations and projections relating to our financial conditions results of operations, plans, objectives, future performance and business. Although Synaptics believes estimates and assumptions to be reasonable, they are subject to a number of risks and uncertainties beyond our control and may prove to be inaccurate.

Synaptics cautions that actual results may differ materially from any future performance suggested in the company's forward-looking statements. We refer you to the company's current and periodic reports filed with the SEC including the Synaptics' Form 10-K for the fiscal year ended June 30, 2018 for important risk factors that could cause actual results to differ materially from those contained in any forward-looking statement. Synaptics expressly disclaims any obligation to update this forward-looking information.

And I'll now turn the call over to Rick Bergman. Rick?

Executive
Rick Bergman

Thanks Jennifer. And I'd like to welcome everyone to today's call. Synaptics posted another strong quarter and a positive first half of our fiscal 2019. Revenue was right on the mark within our guidance range and up 2% sequentially. I'm very, very pleased to report that we handedly exceeded our projections for non-GAAP EPS posting year-over-year growth of 40%. This was driven by our sixth consecutive quarter of improvement in non-GAAP gross margins which were up 300 basis points over the year ago period as we continue to inch closer towards our medium-term target of 40%.

Our favorable operating performance provides further validation of the positive impact of the Synaptics 3.0 strategy on our company and our financial results. We have made