Slides
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power integrations 0 128 GB 3.47 172 Power Integrations , Inc. Q2 2026 Financial Results August 5 , 2026 21 KA © 2026 Power Integrations , Inc. | power.com
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Forward-Looking Statements/Non-GAAP Metrics 2©2026 Power Integrations, Inc. | power.com Note Regarding Forward-Looking Statements Certain statements included in these slides that are not historical facts are forward-looking statements within the meaning of the federal securities laws, including the safe harbor provisions under the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements generally relate to future events or the Company’s future financial or operating performance and are sometimes accompanied by words such as “believe,” “continue,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “predict,” “plan,” “may,” “should,” “will,” “would,” “potential,” “seem,” “seek,” “outlook,” and similar expressions that concern the Company’s expectations, strategy, priorities, plans, or intentions, predict or indicate future events or trends, or that are not statements of historical matters. Forward-looking statements are predictions, projections, and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Forward-looking statements in these slides include, without limitation, the Company’s outlook for the third quarter of 2026, the trends and assumptions underlying such outlook, including the continuation of growth and demand drivers, the Company's expectations regarding new technology, and the Company’s anticipated upcoming dividend, including the timing and amount of such dividend, among others. These statements are based on various assumptions, whether or not identified in these slides. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as and must not be relied on by an investor as a guarantee, an assurance, a prediction, or a definitive statement of fact or probability. Actual events and circumstances are very difficult or impossible to predict and will differ from the assumptions. Many actual events and circumstances are beyond the control of the Company. The Company’s expectations and beliefs regarding these matters may not materialize, and actual results in future periods are subject to risks and uncertainties that could cause actual results to differ materially from the forward-looking statements in these slides, including but not limited to: (i) the risks that the demand drivers behind the Company’s business may not continue to the extent anticipated, or at all; (ii) the risks that the investments in renewable energy, grid infrastructure, and AI data centers may not drive Company customer demand to the extent or in the time frame anticipated, or at all; (iii) the risks that the Company’s new 2200 V PowiGaN technology may not extend the Company’s capabilities in high-voltage GaN nor position the Company to support customer roadmaps over the long term to the extent or in the time frame anticipated, or at all; (iv) the risks that the Company may not be in a position to pay the $0.215 per share dividend on September 30, 2026 as currently anticipated due to unforeseen circumstances; (v) the Company’s ability to forecast its performance; (vi) changes in trade policies, in particular the escalation and imposition of new and higher tariffs, which could reduce demand for end products that incorporate the Company's integrated circuits and/or place pressure on the Company's prices as the Company's customers seek to offset the impact of increased tariffs on their own products; (vii) the Company’s ability to supply products and its ability to conduct other aspects of its business, such as competing for new design wins; (viii) changes in global economic and geopolitical conditions, including such factors as inflation, armed conflicts, and trade negotiations, which may impact the level of demand for the Company’s products; (ix) potential changes and shifts in customer demand away from end products that utilize the Company's integrated circuits to end products that do not incorporate the Company's products; (x) the effects of competition, which may cause the Company’s revenue to decrease or cause the Company to decrease its selling prices for its products; (xi) unforeseen costs and expenses, and unfavorable fluctuations in component costs or operating expenses resulting from changes in commodity prices and/or exchange rates; and (xii) product development delays and defects and market acceptance of the new products. These risks and uncertainties may be amplified by current or future global conflicts and current and potential trade restrictions, trade tensions, and tariffs, all of which continue to cause economic uncertainty. You should carefully consider the foregoing factors and the other risks and uncertainties, including those more fully described in the "Risk Factors" section of the Company’s most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q that the Company has caused to be filed with the U.S. Securities and Exchange Commission, or the SEC, and other documents filed by the Company or that will be filed by the Company from time to time with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements in these slides are based only on information currently available to the Company and speak only as of the date they are made. Investors are cautioned not to put undue reliance on forward-looking statements, and the Company disclaims any obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law. The Company gives no assurance that the Company will achieve any of its expectations. Note Regarding Non-GAAP Financial Measures The non-GAAP measures provided in these slides, including non-GAAP earnings per diluted share, non-GAAP net income, non-GAAP gross margin, non-GAAP operating expenses, and non-GAAP operating margin, should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with generally accepted accounting principles (GAAP) in the United States. The non-GAAP financial measures are presented only as supplemental information to understand the Company’s operating results. In addition to the company's consolidated financial statements, which are presented according to GAAP, the company provides certain non-GAAP financial information that excludes stock-based compensation expenses recorded under ASC 718-10, amortization of acquisition-related intangible assets, a judgment in a legal matter, a restructuring charge recognized in the first quarter of 2026, and the tax effects of these items. The company considers these non-GAAP financial measures to be important because they provide additional insight into the company’s on-going performance; the company uses these measures in its financial and operational decision-making and, with respect to non-GAAP operating income, in setting performance targets for compensation purposes. The company believes that these non-GAAP measures offer important analytical tools to help investors understand its operating results, to enable more meaningful and consistent period-to-period comparisons, and to facilitate comparability with the results of companies that provide similar measures. Non-GAAP measures have limitations as analytical tools, do not have any standardized meanings and are therefore unlikely to be comparable to similarly titled measures presented by other companies, and are not meant to be considered in isolation or as a substitute for GAAP financial information. For example, stock-based compensation is an important component of the company’s compensation mix and will continue to result in significant expenses in the company’s GAAP results for the foreseeable future but is not reflected in the non-GAAP measures. Reconciliations of non-GAAP measures to GAAP measures are included at the end of this presentation and in the financial tables on the investor page of the Power Integrations website, http://investors.power.com.
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Revenue up 10% sequentially Revenue $118.9M, up 10% QoQ; outlook was $115M - $120M QoQ growth in all four end markets Industrial revenue +14% QoQ Communications revenue +16% QoQ Q2 2026 - Key Messages 3©2026 Power Integrations, Inc. | power.com Higher margins Non-GAAP GM 55.1%, up 160 bps QoQ Non-GAAP operating margin up 540 bps Q/Q to 17.1% Non-GAAP EPS $0.37 Strong cash flow $22.0M cash from operations in Q2 $35.7M free cash flow year-to-date Cash and investments up to $262.6M Quarterly dividend of $0.215/share Lower inventories Channel inventory down 1.6 weeks to 7.3 weeks Internal inventory down 27 days to 265 days on hand Expense discipline Non-GAAP OPEX of $45.2M Down 3% Y/Y in Q2 Below outlook of $46.5M - $47.5M Announced 2200 V PowiGaN Extending our lead in high-voltage GaN Roadmap aligns with evolution of data center market beyond 800 VDC Targeting energy infrastructure, industrial applications See slides 8-11 for reconciliation of non -GAAP metrics to GAAP
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Q2 2026 Financial Results 4©2026 Power Integrations, Inc. | power.com TTM = Trailing Twelve Months *FCF = CFFO – CapEx See slides 8-11 for reconciliation of non-GAAP metrics to GAAP Non-GAAP TTM Revenue $449.4M Cash Flow from Operations (TTM) $98.1M CapEx (TTM) $19.0M Free Cash Flow* (TTM) $79.1M Cash & Investments at Quarter-end $262.6M Inventory Days on Hand 265 (-27 QoQ) Distributor Inventory 7.3 weeks (-1.6 QoQ) Additional Metrics Q2 GAAP Result Q2 Non- GAAP Result Q2 Outlook Was Year-Ago Qtr Prior Qtr Revenue $118.9M N/A $115M-$120M $115.9M (+3%) $108.3M (+10%) Gross Margin 54.3% 55.1% 54 - 55% 55.8% 53.5% Operating Expenses $55.7M $45.2M $46.5M-$47.5M $46.7M $45.3M Operating Margin 7.5% 17.1% 13.5% - 15.5% 15.6% 11.7% Net Income $9.8M $20.9M N/A $19.9M $13.9M Diluted EPS $0.17 $0.37 N/A $0.35 $0.25
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36% Consumer 10% Comms11% Computer 43% Industrial / Auto Revenue by End Market Revenue Mix Q2’26 ©2026 Power Integrations, Inc. | power.com 5 Revenue Commentary Industrial: Continued broad-based growth Consumer: Flat YoY vs. tariff-driven strength in appliances in 2025 Computer: Seasonal recovery in tablets Comms: Seasonal growth in cellphones Growth Rates Q2'26 YoY Q2’26 QoQ YTD Industrial/Auto +10% +14% +16% Consumer Flat +5% -5% Computer -9% +5% -8% Comms -2% +16% -1% Total +3% +10% +3% 38% 10%11% 41% 34% 11%13% 42%34%r 15%14% 37% Prior Three Quarters Q4’25 Q3’25Q1’26
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Reconciling ItemsNon-GAAPGAAP Q3 2026 Outlook 6©2026 Power Integrations, Inc. | power.com Revenue Gross Margin $122M - $130M N/A N/A 53.3% - 54.4% 54% - 55% Stock-based compensation 0.5% - 0.6% Amortization of intangibles 0.1% Operating Expenses $55M - $56M $45M - $46M Stock-based compensation $10.0M Operating Margin 8.3% - 10.9% 17% - 19% Stock-based compensation 8.0% - 8.6% Amortization of intangibles 0.1%
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Extending the Range of PowiGaN to 2200 V 7©2026 Power Integrations, Inc. | power.com Industry’s first 2200 V GaN technology brings the efficiency and power density of PowiGaN to a range of higher-voltage applications: AI data centers beyond 800 VDC 1500 V automotive fast chargers Auxiliary power supply for 1200 V automotive systems 1500 V utility scale solar and BESS Auxiliary power supply for HVDC transmission
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Non-GAAP to GAAP Reconciliations (in thousands, except per-share amounts) 8©2026 Power Integrations, Inc. | power.com June 30, 2026 March 31, 2026 June 30, 2025 June 30, 2026 June 30, 2025 RECONCILIATION OF GROSS PROFIT G AAP gross profit $ 64,637 $ 56,938 $ 63,954 $ 121,575 $ 122,189 GAAP gross margin 54.3 % 52.6 % 55.2 % 53.5 % 55.2 % L ess: Stock-based com pensation included in cost of revenue 707 469 592 1,176 1,249 Am ortization of acquisition-related intangible assets 147 147 146 294 293 Restructuring and related charges in cost of revenue (b) - 365 - 365 - Total 854 981 738 1,835 1,542 Non-G AAP gross profit $ 65,491 $ 57,919 $ 64,692 $ 123,410 $ 123,731 Non-GAAP gross margin 55.1 % 53.5 % 55.8 % 54.3 % 55.9 % Three Months Ended Six Months Ended
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Non-GAAP to GAAP Reconciliations (in thousands, except per-share amounts) 9©2026 Power Integrations, Inc. | power.com June 30, 2026 March 31, 2026 June 30, 2025 June 30, 2026 June 30, 2025 RECONCILIATION OF OPERATING EXPENSES G AAP operating ex penses $ 55,737 $ 55,484 $ 65,299 $ 111,221 $ 116,816 L ess: Stock-based compensation unrelated to restructuring 10,029 5,430 9,485 15,459 17,511 Other operating expenses (income) (a) 522 (1,419) 9,151 (897) 9,151 Restructuring and related charges (b) - 6,204 - 6,204 - Total 10,551 10,215 18,636 20,766 26,662 Non-GAAP operating expenses $ 45,186 $ 45,269 $ 46,663 $ 90,455 $ 90,154 Three Months Ended Six Months Ended
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Non-GAAP to GAAP Reconciliations (in thousands, except per-share amounts) 10©2026 Power Integrations, Inc. | power.com June 30, 2026 March 31, 2026 June 30, 2025 June 30, 2026 June 30, 2025 RECONCILIATION OF INCOME (LOSS) FROM OPERATIONS G AAP incom e (loss) from operations $ 8,900 $ 1,454 $ (1,345)$ 10,354 $ 5,373 GAAP operating margin 7.5 % 1.3 % (1.2%) 4.6 % 2.4 % Add: Stock-based com pensation unrelated to restructuring 10,736 5,899 10,077 16,635 18,760 Amortization of acquisition-related intangible assets 147 147 146 294 293 Other operating expenses (income) (a) 522 (1,419) 9,151 (897) 9,151 Restructuring and related charges (b) - 6,569 - 6,569 - Total 11,405 11,196 19,374 22,601 28,204 Non-G AAP incom e from operations $ 20,305 $ 12,650 $ 18,029 $ 32,955 $ 33,577 Non-GAAP operating margin 17.1 % 11.7 % 15.6 % 14.5 % 15.2 % Three Months Ended Six Months Ended
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Non-GAAP to GAAP Reconciliations (in thousands, except per-share amounts) 11©2026 Power Integrations, Inc. | power.com June 30, 2026 March 31, 2026 June 30, 2025 June 30, 2026 June 30, 2025 RECONCILIATION OF NET INCOME PER SHARE (DILUTED) G AAP net incom e $ 9,833 $ 3,300 $ 1,369 $ 13,133 $ 10,159 Adjustm ents to G AAP net incom e: Total stock-based compensation unrelated to restructuring 10,736 5,899 10,077 16,635 18,760 Amortization of acquisition-related intangible assets 147 147 146 294 293 Other operating expenses (income) (a) 522 (1,419) 9,151 (897) 9,151 Restructuring and related charges (b) 0 6,569 0 6,569 0 Tax effect of adjustments to GAAP results (c) (363) (611) (871) (974) (632) Total 11,042 10,585 18,503 21,627 27,572 Non-GAAP net income $ 20,875 $ 13,885 $ 19,872 $ 34,760 $ 37,731 Average shares outstanding for calculation of non-G AAP net incom e per share (diluted) 56,696 55,874 56,387 56,335 56,787 G AAP net incom e per share (diluted) $ 0.17 $ 0.06 $ 0.02 $ 0.23 $ 0.18 Non-G AAP net incom e per share (diluted) $ 0.37 $ 0.25 $ 0.35 $ 0.62 $ 0.66 Three Months Ended Six Months Ended