SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16
OR 15d-16 OF THE SECURITIES EXCHANGE ACT OF 1934
For the month of October, 2024
Commission File Number 000-23288
SILICOM LTD.
(Translation of Registrant’s name into English)
14 Atir Yeda St., P.O.Box 2164, Kfar-Sava 4464323, Israel
(Address of Principal Executive Offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):___
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):___
On October 31, 2024, the Registrant issued a press release announcing the Registrant's third quarter 2024 financial results. Attached hereto are the following exhibits:
The US GAAP information set forth on the Consolidated Balance Sheet and Consolidated Statement of Operations in the financial tables on Pages 4 and 5 of Exhibit 99.1 is hereby
incorporated by reference into all effective registration statements filed by the registrant under the Securities Act of 1933.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
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SILICOM LTD.
(Registrant)
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Date: October 31, 2024
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By
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/s/ Eran Gilad
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Eran Gilad
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Chief Financial Officer
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Exhibit 99.1
Silicom Reports Q3 2024 Results
KFAR SAVA, Israel, October 31, 2024 - Silicom Ltd. (NASDAQ: SILC), a leading provider of high-performance networking and data infrastructure solutions, today
reported its financial results for the third quarter ended September 30, 2024.
Financial Results
Third quarter: Silicom’s revenues for the third quarter of 2024 were $14.8 million compared with $30.1 million for the third quarter of
2023.
On a GAAP basis, the company’s net loss for the quarter totalled $2.6 million, or $0.44 per ordinary share (basic and diluted), compared with net income of $1.2 million, or $0.18 per ordinary share
(basic and diluted), for the third quarter of 2023.
On a non-GAAP basis (as described and reconciled below), net loss for the quarter totalled $1.7 million, or $0.28 per ordinary share (basic and diluted), compared with net income of $2.1 million, or
$0.30 per ordinary share (basic and diluted), for the third quarter of 2023.
First Nine Months: Silicom’s revenues for the first nine months of 2024 were $43.6 million compared with $105.4 million for the first
three quarters of 2023.
On a GAAP basis, net loss for the period totalled $7.6 million, or $1.24 per ordinary share (basic and diluted), compared with net income of $8.6 million, or $1.26 per diluted share ($1.27 per basic
share), for the first nine months of 2023.
On a non-GAAP basis (as described and reconciled below), net loss for the period totalled $4.9 million, or $0.80 per ordinary share (basic and diluted), compared with net income of $10.7 million, or
$1.57 per diluted share ($1.58 per basic share), for the first nine months of 2023.
During the first nine months of 2024, the Company generated approximately $14 million in cash, and invested more than half of that, approximately $8.6 million, in repurchasing Silicom shares.
Guidance
Management projects that revenues for the fourth quarter of 2024 will range from $14 million to $15 million. Growth in 2025 is expected to be in the low single digits, with strong 20%-30% compound annual growth rate
materializing gradually from 2026.
Comments of Management
Liron Eizenman, Silicom’s President and CEO, commented, “During the third quarter, we continued to progress towards our mid- and long-term goals while dealing responsibly with our short-term
challenges. While we continue to be negatively impacted by excess inventories built by specific customers in previous years - whether in reaction to supply chain disruptions only or in combination with slower-than-expected sales of their new products
and services - we believe we will see improvement in the situation during 2025 and a resolution by the end of 2025.
“In the meantime, we continue moving forward according to our strategic plan, with significant milestones affirming the potential of our core Server Adapter and Edge System products to drive
significant revenue growth in 2026 and beyond. For example, a service provider customer has recently decided to standardize on our Edge products for all of its deployment scenarios, making Silicom its single hardware provider for its diverse
offerings. Deployments will initiate in 2025, and we expect related sales to reach several million dollars per year already in 2026. In parallel, a network equipment OEM has selected one of our high-speed 400G FPGA smart NICs for its core network
architecture, with first deliveries scheduled for the first quarter of 2025 and a multi-million-dollar ramp up beginning in 2026. As we continuously increase the number of these ‘slow and steady’ engagements, we will benefit from ongoing revenue
growth and a reduced dependency on specific large accounts. Any faster-than-projected ramp up of pipeline deals could accelerate our progress significantly.”
Mr. Eizenman continued, “Looking forward, we continue to focus on achieving an EPS above $3 as we return our revenues to $150 - $160
million per year. To this end, we have ‘right-sized’ our expenses, investing as needed to achieve our strategic targets while retaining tight control of our outlays. Based on our very strong balance sheet, we continue moving forward with our share
buyback plan: in fact, during the first three quarters of 2024 we have already repurchased more than half a million shares.”
Mr. Eizenman concluded, “All in all, we are operating from an extremely solid financial platform, executing on an impressive pipeline
and pursuing ambitious but achievable goals. Our team is dedicated, experienced, and fully focused on creating value - for our customers, for the market as a whole, and especially for our shareholders.”
Conference Call Details
Silicom’s Management will host an interactive conference today, October 31st, at 9am Eastern Time (6am Pacific Time, 3pm Israel Time) to review and discuss the results.
To participate, investors may either listen via a webcast link hosted on Silicom’s website or via the dial-in. The link is under the investor relations’ webcast section of Silicom’s website at https://www.silicom-usa.com/webcasts/
For those that wish to dial in via telephone, one of the following teleconferencing numbers may be used:
US: 1 866 860 9642
ISRAEL: 03 918 0609
INTERNATIONAL: +972 3 918 0609
At: 9:00am Eastern Time, 6:00am Pacific Time, 3:00pm Israel Time
It is advised to connect to the conference call a few minutes before the start.
For those unable to listen to the live call, a replay of the call will be available for three months from the day after the call under the above-mentioned webcast section of Silicom’s website.
***
Non-GAAP Financial Measures
This release, including the financial tables below, presents other financial information that may be considered "non-GAAP financial measures" under Regulation G and related reporting requirements
promulgated by the Securities and Exchange Commission (the "SEC") as they apply to our company. These non-GAAP financial measures exclude compensation expenses in respect of options and RSUs granted to directors, officers and employees,
impairment of goodwill, taxes on amortization and impairment of acquired intangible assets, impairment of intangible assets and related write-offs, as well as lease liabilities - financial expenses (income). Non-GAAP financial measures should be
evaluated in conjunction with, and are not a substitute for, GAAP financial measures. The tables also present the GAAP financial measures, which are most comparable to the non-GAAP financial measures as well as reconciliation between the non-GAAP
financial measures and the most comparable GAAP financial measures. The non-GAAP financial information presented herein should not be considered in isolation from or as a substitute for operating income (loss), net income (loss) or per share data
prepared in accordance with GAAP.
About Silicom
Silicom Ltd. is an industry-leading provider of high-performance networking and data infrastructure solutions. Designed primarily to improve performance and efficiency in Cloud and Data Center
environments, Silicom’s solutions increase throughput, decrease latency and boost the performance of servers and networking appliances, the infrastructure backbone that enables advanced Cloud architectures and leading technologies like NFV,
SD-WAN and Cyber Security. Our innovative solutions for high-density networking, high-speed fabric switching, offloading and acceleration, which utilize a range of cutting-edge silicon technologies as well as FPGA-based solutions, are ideal for
scaling-up and scaling-out cloud infrastructures.
Silicom products are used by major Cloud players, service providers, telcos and OEMs as components of their infrastructure offerings, including both add-on adapters in the Data Center and
stand-alone virtualized/universal CPE devices at the edge.
Silicom’s long-term, trusted relationships with more than 200 customers throughout the world, its more than 400 active Design Wins and more than 300 product SKUs have made Silicom a “go-to”
connectivity/performance partner of choice for technology leaders around the globe.
For more information, please visit: www.silicom.co.il
Statements in this press Statements in this press release which are not historical data are forward-looking statements which involve known and unknown risks, uncertainties, or other factors not
under the company's control, which may cause actual results, performance, or achievements of the company to be materially different from the results, performance, or other expectations implied by these forward-looking statements. These factors
include, but are not limited to, Silicom’s increasing dependence for substantial revenue growth on a limited number of customers, the speed and extent to which Silicom's solutions are adopted by the relevant markets, difficulty in commercializing
and marketing of Silicom’s products and services, maintaining and protecting brand recognition, protection of intellectual property, competition, disruptions to its manufacturing, sales & marketing, development and customer support activities,
the impact of the wars in Gaza and in the Ukraine, attacks on shipping by Huthis in the Red Sea, rising inflation, rising interest rates and volatile exchange rates, as well as any continuing or new effects resulting from the COVID-19 pandemic, and
the global economic uncertainty, which may impact customer demand by encouraging them to exercise greater caution and selectivity with their short-term IT investment plans. The factors noted above are not exhaustive.
Further information about the company’s businesses, including information about factors that could materially affect Silicom’s results of operations and financial condition, are discussed in our
Annual Report on Form 20-F and other documents filed by the Company and that may be subsequently filed by the company from time to time with the SEC. These forward-looking statements can generally be identified as such because the context of the
statement will include words such as “expect,” “should,” “believe,” “anticipate” or words of similar import. Similarly, statements that describe future plans, objectives or goals are also forward-looking statements. In light of significant risks
and uncertainties inherent in forward-looking statements, the inclusion of such statements should not be regarded as a representation by the company that it will achieve such forward-looking statements. The company disclaims any duty to update such
statements, whether as a result of new information, future events, or otherwise.
Company Contact:
Eran Gilad, CFO
Silicom Ltd.
Tel: +972-9-764-4555
E-mail: erang@silicom.co.il
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Investor Relations Contact:
Ehud Helft
EK Global Investor Relations
Tel: +1 212 378 8040
E-mail: silicom@ekgir.com
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-- FINANCIAL TABLES FOLLOW –
Silicom Ltd. Consolidated Balance Sheets
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September 30,
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December 31,
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2024
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2023
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Assets
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Current assets
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Cash and cash equivalents
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$
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59,489
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$
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46,972
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Marketable securities
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9,818
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7,957
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Accounts receivables: Trade, net
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13,264
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25,004
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Accounts receivables: Other
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7,033
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3,688
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Inventories
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43,498
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51,507
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Total current assets
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133,102
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135,128
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Marketable securities
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7,799
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16,619
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Assets held for employees’ severance benefits
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1,481
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1,357
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Deferred tax assets
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2,747
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2,359
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Property, plant and equipment, net
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2,914
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3,552
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Intangible assets, net
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2,316
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2,253
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Right of Use
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7,280
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6,466
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Total assets
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$
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157,639
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$
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167,734
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Liabilities and shareholders' equity
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| |
|
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Current liabilities
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Trade accounts payable
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$
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7,490
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$
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4,139
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Other accounts payable and accrued expenses
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6,443
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6,668
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Lease Liabilities
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1,633
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2,070
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Total current liabilities
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15,566
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12,877
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Lease Liabilities
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5,034
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|
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3,877
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Liability for employees’ severance benefits
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2,596
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|
|
|
2,672
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Deferred tax liabilities
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92
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|
|
|
46
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|
|
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|
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Total liabilities
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23,288
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|
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19,472
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Shareholders' equity
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Ordinary shares and additional paid-in capital
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73,000
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70,693
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Treasury shares
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(52,271
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)
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(43,631
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)
|
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Retained earnings
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113,622
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|
|
|
121,200
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Total shareholders' equity
|
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|
134,351
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|
|
|
148,262
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|
|
|
|
|
|
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Total liabilities and shareholders' equity
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|
$
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157,639
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|
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$
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167,734
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Silicom Ltd. Consolidated Statements of Operations
(US$ thousands, except for share and per share data)
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Three-month period
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Nine-month period
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ended September 30,
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ended September 30,
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2024
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2023
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2024
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2023
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Sales
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$
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14,756
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$
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30,057
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$
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43,623
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|
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$
|
105,368
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Cost of sales
|
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10,593
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|
|
|
20,821
|
|
|
|
31,158
|
|
|
|
72,185
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Gross profit
|
|
|
4,163
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|
|
|
9,236
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|
|
|
12,465
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|
|
|
33,183
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|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Research and development expenses
|
|
|
4,958
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|
|
|
5,231
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|
|
|
14,827
|
|
|
|
15,622
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|
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Selling and marketing expenses
|
|
|
1,366
|
|
|
|
1,946
|
|
|
|
4,360
|
|
|
|
5,343
|
|
|
General and administrative expenses
|
|
|
952
|
|
|
|
1,099
|
|
|
|
2,978
|
|
|
|
3,205
|
|
|
Total operating expenses
|
|
|
7,276
|
|
|
|
8,276
|
|
|
|
22,165
|
|
|
|
24,170
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
|
(3,113
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)
|
|
|
960
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|
|
|
(9,700
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)
|
|
|
9,013
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|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Financial income (expenses), net
|
|
|
515
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|
|
|
434
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|
|
|
1,601
|
|
|
|
1,201
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|
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Income (loss) before income taxes
|
|
|
(2,598
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)
|
|
|
1,394
|
|
|
|
(8,099
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)
|
|
|
10,214
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|
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Income taxes
|
|
|
32
|
|
|
|
183
|
|
|
|
(521
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)
|
|
|
1,660
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|
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Net income (loss)
|
|
$
|
(2,630
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)
|
|
$
|
1,211
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|
|
$
|
(7,578
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)
|
|
$
|
8,554
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|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic income (loss) per ordinary share (US$)
|
|
$
|
(0.44
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)
|
|
$
|
0.18
|
|
|
$
|
(1.24
|
)
|
|
$
|
1.27
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Weighted average number of ordinary shares used to compute basic income (loss) per share (in thousands)
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|
|
5,919
|
|
|
|
6,744
|
|
|
|
6,090
|
|
|
|
6,754
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|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted income (loss) per ordinary share (US$)
|
|
$
|
(0.44
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)
|
|
$
|
0.18
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|
|
$
|
(1.24
|
)
|
|
$
|
1.26
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Weighted average number of ordinary shares used to compute diluted income (loss) per share (in thousands)
|
|
|
5,919
|
|
|
|
6,753
|
|
|
|
6,090
|
|
|
|
6,809
|
|
Silicom Ltd. Reconciliation of Non-GAAP Financial Results
(US$ thousands, except for share and per share data)
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|
Three-month period
|
|
|
Nine-month period
|
|
| |
|
ended September 30,
|
|
|
ended September 30,
|
|
| |
|
2024
|
|
|
2023
|
|
|
2024
|
|
|
2023
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP gross profit
|
|
$
|
4,163
|
|
|
$
|
9,236
|
|
|
$
|
12,465
|
|
|
$
|
33,183
|
|
|
(1) Share-based compensation (*)
|
|
|
82
|
|
|
|
105
|
|
|
|
193
|
|
|
|
323
|
|
|
Non-GAAP gross profit
|
|
$
|
4,245
|
|
|
$
|
9,341
|
|
|
$
|
12,658
|
|
|
$
|
33,506
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating income (loss)
|
|
$
|
(3,113
|
)
|
|
$
|
960
|
|
|
$
|
(9,700
|
)
|
|
$
|
9,013
|
|
|
Gross profit adjustments
|
|
|
82
|
|
|
|
105
|
|
|
|
193
|
|
|
|
323
|
|
|
(1) Share-based compensation (*)
|
|
|
777
|
|
|
|
834
|
|
|
|
2,113
|
|
|
|
2,091
|
|
|
Non-GAAP operating income (loss)
|
|
$
|
(2,254
|
)
|
|
$
|
1,899
|
|
|
$
|
(7,394
|
)
|
|
$
|
11,427
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income (loss)
|
|
$
|
(2,630
|
)
|
|
$
|
1,211
|
|
|
$
|
(7,578
|
)
|
|
$
|
8,554
|
|
|
Operating income (loss) adjustments
|
|
|
859
|
|
|
|
939
|
|
|
|
2,306
|
|
|
|
2,414
|
|
|
(2) Lease liabilities - Financial expenses (income)
|
|
|
98
|
|
|
|
(163
|
)
|
|
|
(9
|
)
|
|
|
(467
|
)
|
|
(3) Taxes on amortization and impairment of acquired intangible assets
|
|
|
22
|
|
|
|
68
|
|
|
|
397
|
|
|
|
203
|
|
|
Non-GAAP net income (loss)
|
|
$
|
(1,651
|
)
|
|
$
|
2,055
|
|
|
$
|
(4,884
|
)
|
|
$
|
10,704
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income (loss)
|
|
$
|
(2,630
|
)
|
|
$
|
1,211
|
|
|
$
|
(7,578
|
)
|
|
$
|
8,554
|
|
|
Adjustments for Non-GAAP Cost of sales
|
|
|
82
|
|
|
|
105
|
|
|
|
193
|
|
|
|
323
|
|
|
Adjustments for Non-GAAP Research and development expenses
|
|
|
386
|
|
|
|
412
|
|
|
|
986
|
|
|
|
1,010
|
|
|
Adjustments for Non-GAAP Selling and marketing expenses
|
|
|
191
|
|
|
|
199
|
|
|
|
537
|
|
|
|
548
|
|
|
Adjustments for Non-GAAP General and administrative expenses
|
|
|
200
|
|
|
|
223
|
|
|
|
590
|
|
|
|
533
|
|
|
Adjustments for Non-GAAP Financial income (loss), net
|
|
|
98
|
|
|
|
(163
|
)
|
|
|
(9
|
)
|
|
|
(467
|
)
|
|
Adjustments for Non-GAAP Income taxes
|
|
|
22
|
|
|
|
68
|
|
|
|
397
|
|
|
|
203
|
|
|
Non-GAAP net income (loss)
|
|
$
|
(1,651
|
)
|
|
$
|
2,055
|
|
|
$
|
(4,884
|
)
|
|
$
|
10,704
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP basic income (loss) per ordinary share (US$)
|
|
$
|
(0.44
|
)
|
|
$
|
0.18
|
|
|
$
|
(1.24
|
)
|
|
$
|
1.27
|
|
|
(1) Share-based compensation (*)
|
|
|
0.14
|
|
|
|
0.13
|
|
|
|
0.37
|
|
|
|
0.35
|
|
|
(2) Lease liabilities - Financial expenses (income)
|
|
|
0.02
|
|
|
|
(0.02
|
)
|
|
|
-
|
|
|
|
(0.07
|
)
|
|
(3) Taxes on amortization and impairment of acquired intangible assets
|
|
|
-
|
|
|
|
0.01
|
|
|
|
0.07
|
|
|
|
0.03
|
|
|
Non-GAAP basic income (loss) per ordinary share (US$)
|
|
$
|
(0.28
|
)
|
|
$
|
0.30
|
|
|
$
|
(0.80
|
)
|
|
$
|
1.58
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP diluted income (loss) per ordinary share (US$)
|
|
$
|
(0.44
|
)
|
|
$
|
0.18
|
|
|
$
|
(1.24
|
)
|
|
$
|
1.26
|
|
|
(1) Share-based compensation (*)
|
|
|
0.14
|
|
|
|
0.13
|
|
|
|
0.37
|
|
|
|
0.35
|
|
|
(2) Lease liabilities - Financial expenses (income)
|
|
|
0.02
|
|
|
|
(0.02
|
)
|
|
|
-
|
|
|
|
(0.07
|
)
|
|
(3) Taxes on amortization and impairment of acquired intangible assets
|
|
|
-
|
|
|
|
0.01
|
|
|
|
0.07
|
|
|
|
0.03
|
|
|
Non-GAAP diluted income (loss) per ordinary share (US$)
|
|
$
|
(0.28
|
)
|
|
$
|
0.30
|
|
|
$
|
(0.80
|
)
|
|
$
|
1.57
|
|
(*) Adjustments related to share-based compensation expenses according to ASC topic 718 (SFAS 123 (R))