Cirrus ‘Still Competitively Constrained,’ Says Apple Chip Supplier
Cirrus Logic “could probably grow the business faster if we could grow the wafer supply, but that's a fairly universal challenge right now,” said CEO John Forsyth on a Monday call for fiscal Q2 ended Sept. 25. Revenue in the…
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quarter grew 34% year over year to $465.9 million, “due in large part to the ramping of components ahead of customers’ new smartphone launches,” he said. Apple is its largest customer. Cirrus paid GlobalFoundries $225 million under a wafer supply agreement that lasts through 2026, said Chief Financial Officer Thurman Case. About $175 million of that was in prepayments for wafers, the rest a capacity “reservation fee,” he said. The deal puts Cirrus “in a position” to procure a “quite meaningfully larger number of wafers during next calendar year relative to this year,” said Forsyth. “That would be supportive of a healthy amount of business growth.” Overall Cirrus revenue will continue “to be driven by the unit sales of our largest customer’s products,” he said. “We don't really have a role to play in terms of managing the mix of that. We're just focused on supporting our customer, getting them as many devices as is humanly possible.” Components shortages and COVID-19 pandemic disruptions cost Apple $6 billion in revenue for its fiscal Q4 ended Sept. 25, CEO Tim Cook told investors last week (see 2110290040).