Allegro MicroSystems, Inc. reported a significant decline in financial performance for the three and nine months ended December 27, 2024, compared to the same periods in the previous fiscal year. Total net sales for the third quarter were $177.9 million, down 30.2% from $255.0 million in the prior year. For the nine-month period, net sales decreased by 34.2% to $532.2 million from $808.8 million. The company recorded a net loss of $6.8 million for the third quarter, a stark contrast to the net income of $33.4 million reported in the same quarter of the previous year. For the nine-month period, the net loss was $58.0 million, compared to a net income of $160.0 million in the prior year.
The decline in revenue was attributed to a reduction in customer-held inventory, which led to decreased shipments across all end markets, including automotive and industrial applications. Automotive sales fell by 33.2% to $130.1 million, while industrial and other sales decreased by 20.6% to $47.8 million in the third quarter. The company also experienced a drop in sales of magnetic sensors and power integrated circuits, with respective declines of 25.9% and 36.9% compared to the previous year.
In terms of operational changes, Allegro MicroSystems has been actively managing its costs, with total operating expenses decreasing by 16.4% to $81.3 million in the third quarter. Research and development expenses remained relatively stable, while selling, general, and administrative expenses saw a notable reduction. The company also reported an increase in interest expenses due to higher debt levels following the refinancing of its term loan facility, which contributed to the overall net loss.
Looking ahead, Allegro MicroSystems is focusing on strategic initiatives to stabilize its financial performance. The company has plans to expand its operations in key markets, including China, Japan, and India, to enhance customer service and drive sales growth. Additionally, the company is evaluating potential acquisitions to strengthen its market position. Despite the current challenges, Allegro remains committed to leveraging its technology expertise and customer relationships to navigate the evolving semiconductor landscape.
About ALLEGRO MICROSYSTEMS, INC.
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