Q1’21 Financial Results and Recent Business Highlights

• Revenue of $328.4 million
• GAAP Gross Margin of 41.0 percent; non-GAAP Gross Margin of 49.7 percent
• GAAP diluted loss per share of $0.08; non-GAAP diluted earnings per share of $1.85
• Cash and short-term investments of $243.9 million
• Completed the acquisition of DisplayLink and the rights to Broadcom’s wireless IoT connectivity business

SAN JOSE, Calif., – November 5, 2020 – Synaptics Incorporated (NASDAQ: SYNA), today reported financial results for its first fiscal quarter ended September 26, 2020.

Net revenue for the first quarter of fiscal 2021 was $328.4 million. GAAP net loss for the first quarter of fiscal 2021 was $2.8 million, or a loss of $0.08 per diluted share. Non-GAAP net income for the first quarter of fiscal 2021 was $66.7 million, or $1.85 per diluted share.

“Synaptics delivered a strong start to our fiscal year with first quarter revenues exceeding the mid-point of our guidance, gross margins above the high-end of our guidance, and the highest operating margins for the company in more than six years,” said Michael Hurlston, Synaptics’ president and CEO. “We continue to benefit from the strong design pipeline across all of our businesses, with several new products ramping this quarter and contributing to the strong start of our fiscal year. Our two recent acquisitions are outperforming our initial expectations and the integration of these new businesses are now completed. Together, we are in a much stronger position to drive profitable revenue growth going forward.”

Cash and short-term investments at the quarter end of September 26, 2020 were $243.9 million.

Business Outlook
Dean Butler, Chief Financial Officer of Synaptics, added, “For our second fiscal quarter, we see continuing strong demand for our products and enter the quarter with a strong backlog. Our fiscal Q2 represents a number of important milestones for Synaptics as we anticipate achieving certain key metrics of the financial model we outlined earlier this year, with non-GAAP gross margins above 50% and non-GAAP operating margins above 20%. We also anticipate IoT to be our largest revenue contributor for Q2, surpassing our Mobile products for the first time.”

For the second quarter of fiscal 2021, the company expects:

*Projected Non-GAAP gross margin excludes $23 million of intangible asset amortization, $1 million of stock-based compensation, and $11 million of inventory fair value adjustments.

**Projected Non-GAAP operating expense excludes $18 million to $20 million of stock-based compensation, $2 million to $3 million of restructuring costs, $1 million of retention program costs, $2.5 million of prepaid development amortization, and $9 million of intangible asset amortization.

Earnings Call and Supplementary Materials
The Synaptics first quarter and fiscal 2021 teleconference and webcast is scheduled to begin at 2:00 p.m. PT (5:00 p.m. ET), on Thursday, November 5, 2020, during which the company will provide forward-looking information.

Speakers:

• Michael Hurlston, President and Chief Executive Officer
• Dean Butler, Chief Financial Officer
• Jason Tsai, Head of Investor Relations

To participate on the live call, analysts and investors should dial 833-614-1539 (conference ID: 2270329). Supplementary slides, a copy of the prepared remarks, and a live and archived webcast of the conference call will be accessible from the “Investor Relations” section of the company’s Website at https://investor.synaptics.com/.