Nasdaq:LSCC
LATTICE SEMICONDUCTOR CORP
Lattice Semiconductor delivers advanced analog and mixed-signal chips critical for energy-efficient power management across automotive and industrial sectors.
Key Metrics
Investment Thesis
Bull Case
Lattice maintains a strong balance sheet with over $133M in cash and equivalents despite recent losses, providing flexibility for R&D investment of $188M. The critical role of its power management chips in the global EV transition offers long-term growth potential once market cycles normalize.
Bear Case
Recent financial performance shows a steep deterioration with net profit falling to single digits while cash flows from financing and investing remain highly negative due to share buybacks and capex. The significant drop in revenue over the last two years raises concerns about demand elasticity and competitive pricing pressures.
About LATTICE SEMICONDUCTOR CORP
Lattice Semiconductor designs and manufactures high-performance analog and mixed-signal integrated circuits primarily for automotive, industrial, and consumer markets. The company focuses on power management solutions, including AC/DC conversion controllers and motor drive ICs that optimize efficiency in electric vehicles and smart grid applications.
Analysis
Management Discussion
The company experienced a significant decline in net income, dropping from $259.1M in 2023 to just $3.1M in the most recent period, reflecting broader market headwinds. Revenue also contracted sharply from a peak of $737.2M in 2023 down to $523.3M currently, indicating a challenging environment for demand.
Industry Overview
The global semiconductor industry for analog power management is shifting rapidly toward electrification, requiring higher efficiency and compact form factors. Lattice operates in a high-barrier-to-entry sector where reliability and performance are paramount for automotive applications.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2022 | 2023 | 2024 | 2026 |
|---|---|---|---|---|
| Revenue | $660.4M | $737.2M | $509.4M | $523.3M |
| Cost of Revenue | $208.3M | $222.5M | $169.0M | $166.3M |
| Gross Profit | $452.1M | $514.7M | $340.4M | $356.9M |
| Operating Expenses | $264.7M | $302.4M | $305.9M | $345.7M |
| Operating Income | $187.4M | $212.3M | $34.5M | $11.2M |
| R&D | $135.8M | $159.8M | $159.3M | $188.0M |
| G&A | $122.1M | $137.2M | $116.9M | $153.6M |
| Stock-Based Comp | $55.5M | $70.2M | $53.0M | $115.6M |
| Depreciation | $13.8M | $17.3M | $19.3M | $19.9M |
| Amortization | — | $4.6M | $4.7M | $2.2M |
| Other OpEx | $6.8M | $5.4M | $29.7M | $4.1M |
| Non-Operating Income | $-5.3M | $2.6M | $1.8M | $2.1M |
| Interest Expense | $4.1M | — | — | — |
| Pre-Tax Income | $182.1M | $214.9M | $36.2M | $13.4M |
| Income Tax | $3.2M | $-44.2M | $-24.9M | $10.3M |
| Continuing Ops | $178.9M | $259.1M | $61.1M | $3.1M |
| Discontinued Ops | $0 | $0 | $0 | $0 |
| Net Income | $178.9M | $259.1M | $61.1M | $3.1M |
| Minority Interest | $0 | $0 | $0 | $0 |
| Net to Common | $178.9M | $259.1M | $61.1M | $3.1M |
| Metric | 2022 | 2023 | 2024 | 2026 |
|---|---|---|---|---|
| Current Assets | $379.2M | $367.9M | $364.8M | $363.9M |
| Cash & Equivalents | $145.7M | $128.3M | $136.3M | $133.9M |
| Accounts Receivable | $94.0M | $104.4M | $81.1M | $102.3M |
| Inventory | $110.4M | $98.8M | $103.4M | $89.2M |
| Prepaid Expenses | $29.1M | $36.4M | $44.1M | $38.5M |
| Other Current Assets | $0 | $0 | $0 | $0 |
| Long-Term Assets | $419.5M | $472.9M | $479.1M | $519.2M |
| PP&E (Net) | $47.6M | $49.5M | $53.0M | $77.0M |
| Intangibles | $25.1M | $21.0M | $4.6M | $4.1M |
| Goodwill | $315.4M | $315.4M | $315.4M | $315.4M |
| Operating Leases | $17.6M | $14.5M | $13.9M | $39.5M |
| Other LT Assets | $13.9M | $72.6M | $92.3M | $83.3M |
| Total Assets | $798.7M | $840.9M | $843.9M | $883.1M |
| Current Liabilities | $127.4M | $97.4M | $99.6M | $117.7M |
| Accounts Payable | $42.0M | $34.5M | $36.8M | $56.5M |
| Current Debt | $0 | — | — | — |
| Current Leases | — | — | $5.8M | $6.0M |
| Deferred Revenue | $17.7M | $5.3M | $11.2M | $4.0M |
| Other Current Liab | $19.2M | $21.6M | $156.0K | $20.6M |
| Long-Term Liabilities | $184.2M | $51.5M | $33.3M | $51.4M |
| Long-Term Debt | $128.8M | $0 | — | — |
| LT Operating Leases | $13.6M | $10.7M | $9.4M | $36.1M |
| Other LT Liab | $41.8M | $40.7M | $23.9M | $15.3M |
| Total Liabilities | $311.6M | $148.9M | $133.0M | $169.1M |
| Shareholders' Equity | $487.2M | $692.0M | $710.9M | $714.1M |
| Paid-In Capital | $599.3M | $545.6M | $504.3M | $503.6M |
| Retained Earnings | $-111.1M | $148.0M | $209.1M | $212.2M |
| AOCI | $-2.4M | $-2.9M | $-3.8M | $-3.1M |
| Total L&E | $798.7M | $840.9M | $843.9M | $883.1M |
| Metric | 2022 | 2023 | 2024 | 2026 |
|---|---|---|---|---|
| Net Income (CFO) | $178.9M | $259.1M | $61.1M | $3.1M |
| Non-Cash Adjustments | $-39.7M | $35.9M | $126.1M | $164.4M |
| Working Capital Changes | $99.7M | $-25.4M | $-46.4M | $7.6M |
| Cash from Operations | $238.8M | $269.6M | $140.9M | $175.1M |
| Capital Expenditures | $23.3M | $20.1M | $21.0M | $42.5M |
| Cash from Investing | $-34.9M | $-33.2M | $-37.7M | $-62.3M |
| Debt Issuances | $148.6M | $0 | $0 | — |
| Debt Repayments | $178.8M | $130.0M | $0 | $0 |
| Share Buybacks | $110.1M | $80.0M | $67.0M | $100.0M |
| Cash from Financing | $-188.1M | $-253.7M | $-94.5M | $-115.7M |
| FX Effect | $-1.6M | $-26.0K | $-749.0K | $493.0K |
| Net Change in Cash | $14.2M | $-17.4M | $8.0M | $-2.4M |
| Beginning Cash | $131.6M | $145.7M | $128.3M | $136.3M |
| Ending Cash | $145.7M | $128.3M | $136.3M | $133.9M |
Frequently Asked Questions
How does LATTICE SEMICONDUCTOR CORP make money?
Automotive segment providing core power management ICs for EVs and electrification; Industrial segment serving motor control and renewable energy infrastructure; Consumer and Communications segment offering specialized signal processing solutions.
What are the main risks for LSCC?
High sensitivity to global automotive production slowdowns impacting revenue growth; Intense competition from established players like TI and Infineon in mature analog markets; Exposure to geopolitical tensions affecting semiconductor supply chains and trade policies.
What is LSCC's competitive advantage?
Deep expertise in analog and mixed-signal design enabling high-precision power conversion; Strong presence in the critical automotive electrification supply chain with stringent quality certifications; Proprietary architectures that maximize efficiency for battery-powered applications.
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