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MIL-OSI: Fortinet Reports Fourth Quarter and Full Year 2024 Financial Results

Source: GlobeNewswire (MIL-OSI)

Fourth Quarter 2024 Highlights

Total revenue of $1.66 billion, up 17% year over year
Product revenue of $574 million, up 18% year over year
Billings of $2.00 billion, up 7% year over year¹
Record GAAP operating margin of 35%
Record Non-GAAP operating margin of 39%¹
Unified SASE ARR²up 28% and Security Operations ARR²up 32%, year over year
Ranked #7 on the Forbes Most Trusted Companies in America 2025 list, the only cybersecurity company in the top 50

Full Year 2024 Highlights

Total revenue of $5.96 billion, up 12% year over year
Service revenue of $4.05 billion, up 20% year over year
Record GAAP operating margin of 30%
Record Non-GAAP operating margin of 35%¹
Remaining performance obligations of $6.42 billion, up 12% year over year
Cash flow from operations of $2.26 billion
Free cash flow of $1.88 billion¹
Exceeded the ‘Rule of 45’ for the fifth consecutive year

SUNNYVALE, Calif., Feb. 06, 2025 (GLOBE NEWSWIRE) — Fortinet® (Nasdaq: FTNT), a global cybersecurity leader driving the convergence of networking and security, today announced financial results for the fourth quarter of 2024 and full year ended December 31, 2024.

“In the fourth quarter, we successfully balanced growth and profitability as our non-GAAP operating margin increased 720 basis points year-over-year to a company record of 39%, while revenue grew 17%,” said Ken Xie, Founder, Chairman and Chief Executive Officer of Fortinet. “We continue to execute our strategy of investing in the high-growth Unified SASE and Security Operations markets, while strengthening our position in Secure Networking. Our customers are increasingly recognizing the benefits of a single-vendor approach to SASE, and we expect to emerge as a leader in this space, being the only company to natively develop all SASE functions within a unified operating system, FortiOS, which seamlessly integrates networking and security capabilities.”

Financial Summary for the Fourth Quarter of 2024

Revenue: Total revenue was $1.66 billion for the fourth quarter of 2024, an increase of 17.3% compared to $1.42 billion for the same quarter of 2023.
Service Revenue: Service revenue was $1.09 billion for the fourth quarter of 2024, an increase of 17.2% compared to $927.0 million for the same quarter of 2023.
Product Revenue: Product revenue was $574.0 million for the fourth quarter of 2024, an increase of 17.6% compared to $488.1 million for the same quarter of 2023.
Billings¹: Total billings were $2.00 billion for the fourth quarter of 2024, an increase of 7.4% compared to $1.86 billion for the same quarter of 2023.
Unified SASE ARR²: Unified SASE ARR was $1.12 billion for the fourth quarter of 2024, an increase of 27.9% compared to $875.3 million for the same quarter of 2023.
Security Operations ARR²: Security Operations ARR was $422.4 million for the fourth quarter of 2024, an increase of 32.2% compared to $319.6 million for the same quarter of 2023.
GAAP Operating Income and Margin: GAAP operating income was $574.1 million for the fourth quarter of 2024, representing a GAAP operating margin of 34.6%. GAAP operating income was $385.4 million for the same quarter of 2023, representing a GAAP operating margin of 27.2%.
Non-GAAP Operating Income and Margin¹: Non-GAAP operating income was $650.9 million for the fourth quarter of 2024, representing a non-GAAP operating margin of 39.2%. Non-GAAP operating income was $453.5 million for the same quarter of 2023, representing a non-GAAP operating margin of 32.0%.
GAAP Net Income and Diluted Net Income Per Share: GAAP net income was $526.2 million for the fourth quarter of 2024, compared to GAAP net income of $310.9 million for the same quarter of 2023. GAAP diluted net income per share was $0.68 for the fourth quarter of 2024, based on 775.2 million diluted weighted-average shares outstanding, compared to GAAP diluted net income per share of $0.40 for the same quarter of 2023, based on 772.3 million diluted weighted-average shares outstanding.
Non-GAAP Net Income and Diluted Net Income Per Share¹: Non-GAAP net income was $571.5 million for the fourth quarter of 2024, compared to non-GAAP net income of $392.0 million for the same quarter of 2023. Non-GAAP diluted net income per share was $0.74 for the fourth quarter of 2024, based on 775.2 million diluted weighted-average shares outstanding, compared to $0.51 for the same quarter of 2023, based on 772.3 million diluted weighted-average shares outstanding.
Cash Flow: Cash flow from operations was $477.6 million for the fourth quarter of 2024, compared to $191.7 million for the same quarter of 2023.
Free Cash Flow¹: Free cash flow was $380.0 million for the fourth quarter of 2024, compared to $164.8 million for the same quarter of 2023.

Financial Summary for the Full Year 2024

Revenue: Total revenue was $5.96 billion for 2024, an increase of 12.3% compared to $5.30 billion in 2023.
Service Revenue: Service revenue was $4.05 billion for 2024, an increase of 19.8% compared to $3.38 billion in 2023.
Product Revenue: Product revenue was $1.91 billion for 2024, a decrease of 1.0% compared to $1.93 billion in 2023.
Billings¹: Total billings were $6.53 billion for 2024, an increase of 2.1% compared to $6.40 billion in 2023.
Remaining performance obligations: Remaining performance obligations were $6.42 billion as of December 31, 2024, an increase of 11.7% compared to $5.75 billion as of December 31, 2023.
Deferred Revenue: Total deferred revenue was $6.36 billion as of December 31, 2024, an increase of 10.9% compared to $5.74 billion as of December 31, 2023.
GAAP Operating Income and Margin: GAAP operating income was $1.80 billion for 2024, representing a GAAP operating margin of 30.3%. GAAP operating income was $1.24 billion for 2023, representing a GAAP operating margin of 23.4%.
Non-GAAP Operating Income and Margin¹: Non-GAAP operating income was $2.09 billion for 2024, representing a non-GAAP operating margin of 35.0%. Non-GAAP operating income was $1.51 billion for 2023, representing a non-GAAP operating margin of 28.4%.
GAAP Net Income and Diluted Net Income Per Share: GAAP net income was $1.75 billion for 2024, compared to GAAP net income of $1.15 billion for 2023. GAAP diluted net income per share was $2.26 for 2024, based on 771.9 million diluted weighted-average shares outstanding, compared to GAAP diluted net income per share of $1.46 for 2023, based on 788.2 million diluted weighted-average shares outstanding.
Non-GAAP Net Income and Diluted Net Income Per Share¹: Non-GAAP net income was $1.83 billion for 2024, compared to non-GAAP net income of $1.29 billion for 2023. Non-GAAP diluted net income per share was $2.37 for 2024, based on 771.9 million diluted weighted-average shares outstanding, compared to $1.63 for 2023, based on 788.2 million diluted weighted-average shares outstanding.
Cash Flow: Cash flow from operations was $2.26 billion in 2024 compared to $1.94 billion in 2023.
Free Cash Flow¹: Free cash flow was $1.88 billion in 2024, compared to $1.73 billion in 2023.

Guidance

For the first quarter of 2025, Fortinet currently expects:

Revenue in the range of $1.500 billion to $1.560 billion
Billings in the range of $1.520 billion to $1.600 billion
Non-GAAP gross margin in the range of 80.0% to 81.0%
Non-GAAP operating margin in the range of 30.0% to 31.0%
Diluted non-GAAP net income per share in the range of $0.52 to $0.54, assuming a non-GAAP effective tax rate of 18%. This assumes a diluted share count of 774 million to 780 million.

For the fiscal year 2025, Fortinet currently expects:

Revenue in the range of $6.650 billion to $6.850 billion
Service revenue in the range of $4.575 billion to $4.725 billion
Billings in the range of $7.200 billion to $7.400 billion
Non-GAAP gross margin in the range of 79.0% to 81.0%
Non-GAAP operating margin in the range of 31.0% to 33.0%
Diluted non-GAAP net income per share in the range of $2.41 to $2.47, assuming a non-GAAP effective tax rate of 18%. This assumes a diluted share count of 773 million to 783 million.

These statements are forward looking and actual results may differ materially. Refer to the Forward-Looking Statements section below for information on the factors that could cause our actual results to differ materially from these forward-looking statements.

Our guidance with respect to non-GAAP financial measures excludes stock-based compensation, amortization of acquired intangible assets, charges in connection with litigation settlement, gain on intellectual property matters, gain on bargain purchase related to acquisition, non-cash charge of impairment on an equity method investment and a tax adjustment required for an effective tax rate on a non-GAAP basis, which differs from the GAAP effective tax rate. We have not reconciled our guidance with respect to non-GAAP financial measures to the corresponding GAAP measures because certain items that impact these measures are uncertain or out of our control, or cannot be reasonably predicted. Accordingly, a reconciliation of these non-GAAP financial measures to the corresponding GAAP measures is not available without unreasonable effort.

¹ A reconciliation of GAAP to non-GAAP measures has been provided in the financial statement tables included in this press release. An explanation of these measures is also included below under the heading “Non-GAAP Financial Measures”.
² ARR is defined as the annualized value of renewable / recurring customer agreements as of the measurement date, assuming any contract that expires during the next 12 months is renewed at its existing value.

Conference Call Details

Fortinet will host a conference call today at 1:30 p.m. Pacific Time (4:30 p.m. Eastern Time) to discuss the earnings results. A live webcast of the conference call and supplemental slides will be accessible from the Investor Relations page of Fortinet’s website at https://investor.fortinet.com and a replay will be archived and accessible at https://investor.fortinet.com/events-and-presentations.

First Quarter 2025 Conference Participation Schedule:

Morgan Stanley Technology, Media & Telecom Conference
March 4, 2025

Members of Fortinet’s management team are expected to present at this conference and discuss the latest company strategies and initiatives. Fortinet’s conference presentations are expected to be available via webcast on the company’s website. To access the most updated information, pre-register and listen to the webcast of each event, please visit the Investor Presentation & Events page of Fortinet’s website at https://investor.fortinet.com/events-and-presentations. The schedule is subject to change.

About Fortinet (www.fortinet.com)

Fortinet (Nasdaq: FTNT) is a driving force in the evolution of cybersecurity and the convergence of networking and security. Our mission is to secure people, devices and data everywhere, and today we deliver cybersecurity everywhere our customers need it with the largest integrated portfolio of over 50 enterprise-grade products. Well over half a million customers trust Fortinet’s solutions, which are among the most deployed, most patented and most validated in the industry. The Fortinet Training Institute, one of the largest and broadest training programs in the industry, is dedicated to making cybersecurity training and new career opportunities available to everyone. Collaboration with esteemed organizations from both the public and private sectors, including Computer Emergency Response Teams (“CERTs”), government entities, and academia, is a fundamental aspect of Fortinet’s commitment to enhance cyber resilience globally. FortiGuard Labs, Fortinet’s elite threat intelligence and research organization, develops and utilizes leading-edge machine learning and AI technologies to provide customers with timely and consistently top-rated protection and actionable threat intelligence. Learn more at https://www.fortinet.com, the Fortinet Blog or FortiGuard Labs.

Copyright © 2025 Fortinet, Inc. All rights reserved. The symbols ® and ™ denote respectively federally registered trademarks and common law trademarks of Fortinet, Inc., its subsidiaries and affiliates. Fortinet’s trademarks include, but are not limited to, the following: Fortinet, the Fortinet logo, FortiGate, FortiOS, FortiGuard, FortiCare, FortiAnalyzer, FortiManager, FortiASIC, FortiClient, FortiCloud, FortiMail, FortiSandbox, FortiADC, FortiAgent, FortiAI, FortiAIOps, FortiAntenna, FortiAP, FortiAPCam, FortiAppSec, FortiAuthenticator, FortiCache, FortiCall, FortiCam, FortiCamera, FortiCarrier, FortiCART, FortiCASB, FortiCentral, FortiCNP, FortiConnect, FortiController, FortiConverter, FortiCSPM, FortiCWP, FortiDAST, FortiDATA, FortiDB, FortiDDoS, FortiDeceptor, FortiDeploy, FortiDevice, FortiDevSec, FortiDLP, FortiEdge, FortiEDR, FortiEndpoint, FortiExplorer, FortiExtender, FortiFirewall, FortiFlex, FortiFone, FortiGSLB, FortiGuest, FortiHypervisor, FortiInsight, FortiIsolator, FortiLAN, FortiLink, FortiMonitor, FortiNAC, FortiNDR, FortiPAM, FortiPenTest, FortiPhish, FortiPoint, FortiPolicy, FortiPortal, FortiPresence, FortiProxy, FortiRecon, FortiRecorder, FortiSASE, FortiScanner, FortiSDNConnector, FortiSEC, FortiSIEM, FortiSMS, FortiSOAR, FortiSRA, FortiStack, FortiSwitch, FortiTester, FortiTIP, FortiToken, FortiTrust, FortiVoice, FortiWAN, FortiWeb, FortiWiFi, FortiWLC, FortiWLM, FortiXDR and Lacework FortiCNAPP. Other trademarks belong to their respective owners. Fortinet has not independently verified statements or certifications herein attributed to third parties and Fortinet does not independently endorse such statements. Notwithstanding anything to the contrary herein, nothing herein constitutes a warranty, guarantee, contract, binding specification or other binding commitment by Fortinet or any indication of intent related to a binding commitment, and performance and other specification information herein may be unique to certain environments.

FTNT-F

Forward-Looking Statements

This press release contains forward-looking statements that involve risks and uncertainties. These forward-looking statements include statements regarding any indications related to future growth and market share gains, our strategy going forward, and guidance and expectations around future financial results, including guidance and expectations for the first quarter of 2025 and full year 2025, and any statements regarding our market opportunity and market size, and business momentum. Although we attempt to be accurate in making forward-looking statements, it is possible that future circumstances might differ from the assumptions on which such statements are based such that actual results are materially different from our forward-looking statements in this release. Important factors that could cause results to differ materially from the statements herein include the following: general economic risks, including those caused by economic challenges, a possible economic downturn or recession and the effects of inflation or stagflation, rising interest rates or reduced information technology spending; supply chain challenges; negative impacts from the ongoing war in Ukraine and its related macroeconomic effects and our decision to reduce operations in Russia; competitiveness in the security market; the dynamic nature of the security market and its products and services; specific economic risks worldwide and in different geographies, and among different customer segments; uncertainty regarding demand and increased business and renewals from existing customers; sales execution risks, including risks in connection with the timing and completion of large strategic deals; uncertainties around continued success in sales growth and market share gains; uncertainties in market opportunities and the market size; actual or perceived vulnerabilities in our supply chain, products or services, and any actual or perceived breach of our network or our customers’ networks; longer sales cycles, particularly for larger enterprise, service providers, government and other large organization customers; the effectiveness of our salesforce and failure to convert sales pipeline into final sales; risks associated with successful implementation of multiple integrated software products and other product functionality risks; risks associated with integrating acquisitions and changes in circumstances and plans associated therewith, including, among other risks, changes in plans related to product and services integrations, product and services plans and sales strategies; sales and marketing execution risks; execution risks around new product development and introductions and innovation; litigation and disputes and the potential cost, distraction and damage to sales and reputation caused thereby or by other factors; cybersecurity threats, breaches and other disruptions; market acceptance of new products and services; the ability to attract and retain personnel; changes in strategy; risks associated with management of growth; lengthy sales and implementation cycles, particularly in larger organizations; technological changes that make our products and services less competitive, including advances in artificial intelligence; risks associated with the adoption of, and demand for, our products and services in general and by specific customer segments, including those caused by competition and pricing pressure; excess product inventory for any reason, including those caused by the effects of increased inflation and interest rates in certain geographies and the war in Ukraine; risks associated with business disruption caused by natural disasters and health emergencies such as earthquakes, fires, power outages, typhoons, floods, health epidemics and viruses, and by manmade events such as civil unrest, labor disruption, international trade disputes, international conflicts such as the war in Ukraine or tensions between China and Taiwan, terrorism, wars, and critical infrastructure attacks; tariffs, trade disputes and other trade barriers, and negative impact on sales based on geo-political dynamics and disputes and protectionist policies, including the impact of any future shutdowns of the U.S. government and the transition in administrations; and the other risk factors set forth from time to time in our most recent Annual Report on Form 10-K, our most recent Quarterly Report on Form 10-Q and our other filings with the Securities and Exchange Commission (“SEC”), copies of which are available free of charge at the SEC’s website at www.sec.gov or upon request from our investor relations department. All forward-looking statements herein reflect our opinions only as of the date of this release, and we undertake no obligation, and expressly disclaim any obligation, to update forward-looking statements herein in light of new information or future events.

Non-GAAP Financial Measures

We have provided in this release financial information that has not been prepared in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). These non-GAAP financial and liquidity measures are not based on any standardized methodology prescribed by GAAP and are not necessarily comparable to similar measures presented by other companies. We use these non-GAAP financial measures internally in analyzing our financial results and believe they are useful to investors, as a supplement to GAAP measures, in evaluating our ongoing operational performance. We believe that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing our financial results with peer companies, many of which present similar non-GAAP financial measures to investors.

Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures provided in the financial statement tables below.

Billings (non-GAAP). We define billings as revenue recognized in accordance with GAAP plus the change in deferred revenue from the beginning to the end of the period less any deferred revenue balances acquired from business combination(s) during the period. We consider billings to be a useful metric for management and investors because billings drive current and future revenue, which is an important indicator of the health and viability of our business. There are a number of limitations related to the use of billings instead of GAAP revenue. First, billings include amounts that have not yet been recognized as revenue and are impacted by the term of security and support agreements. Second, we may calculate billings in a manner that is different from peer companies that report similar financial measures. Management accounts for these limitations by providing specific information regarding GAAP revenue and evaluating billings together with GAAP revenue.

Free cash flow (non-GAAP). We define free cash flow as net cash provided by operating activities minus purchases of property and equipment. We believe free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business that, after capital expenditures, can be used for strategic opportunities, including repurchasing outstanding common stock, investing in our business, making strategic acquisitions and strengthening the balance sheet. A limitation of using free cash flow rather than the GAAP measures of cash provided by or used in operating activities, investing activities, and financing activities is that free cash flow does not represent the total increase or decrease in the cash and cash equivalents balance for the period because it excludes investing activities other than capital expenditures and cash flows from financing activities. Management accounts for this limitation by providing information about our capital expenditures and other investing and financing activities on the face of the cash flow statement and under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources” in our most recent Quarterly Report on Form 10-Q and Annual Report on Form 10-K and by presenting cash flows from investing and financing activities in our reconciliation of free cash flow. In addition, it is important to note that other companies, including companies in our industry, may not use free cash flow, may calculate free cash flow in a different manner than we do or may use other financial measures to evaluate their performance, all of which could reduce the usefulness of free cash flow as a comparative measure.

Non-GAAP operating income and operating margin. We define non-GAAP operating income as operating income plus stock-based compensation, amortization of acquired intangible assets and charges in connection with litigation settlement, less gain on intellectual property matter and, when applicable, other significant non-recurring items in a given quarter. Non-GAAP operating margin is defined as non-GAAP operating income divided by GAAP revenue. We consider these non-GAAP financial measures to be useful metrics for management and investors because they exclude the items noted above so that our management and investors can compare our recurring core business operating results over multiple periods. There are a number of limitations related to the use of non-GAAP operating income instead of operating income calculated in accordance with GAAP. First, non-GAAP operating income excludes the items noted above. Second, the components of the costs that we exclude from our calculation of non-GAAP operating income may differ from the components that peer companies exclude when they report their non-GAAP results of operations. Management accounts for these limitations by providing specific information regarding the GAAP amounts excluded from non-GAAP operating income and evaluating non-GAAP operating income together with operating income calculated in accordance with GAAP.

Non-GAAP net income and diluted net income per share. We define non-GAAP net income as net income plus the items noted above under non-GAAP operating income and operating margin. In addition, we adjust non-GAAP net income and diluted net income per share for a gain on bargain purchase related to acquisition, a non-cash charge of impairment on an equity method investment and a tax adjustment required for an effective tax rate on a non-GAAP basis, which differs from the GAAP effective tax rate. We define non-GAAP diluted net income per share as non-GAAP net income divided by the non-GAAP diluted weighted-average shares outstanding. We consider these non-GAAP financial measures to be useful metrics for management and investors for the same reasons that we use non-GAAP operating income and non-GAAP operating margin. However, in order to provide a more complete picture of our recurring core business operating results, we include in non-GAAP net income and non-GAAP diluted net income per share, the tax adjustment required resulting in an effective tax rate on a non-GAAP basis, which often differs from the GAAP tax rate. We believe the non-GAAP effective tax rates we use are reasonable estimates of normalized tax rates for our current and prior fiscal years under our global operating structure. The same limitations described above regarding our use of non-GAAP operating income and non-GAAP operating margin apply to our use of non-GAAP net income and non-GAAP diluted net income per share. We account for these limitations by providing specific information regarding the GAAP amounts excluded from non-GAAP net income and non-GAAP diluted net income per share and evaluating non-GAAP net income and non-GAAP diluted net income per share together with net income and diluted net income per share calculated in accordance with GAAP.

FORTINET, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited, in millions)

	December 31, 2024			December 31, 2023
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	2,875.9		$	1,397.9
Short-term investments		1,126.4			1,021.5
Marketable equity securities		64.2			21.0
Accounts receivable—net		1,463.4			1,402.0
Inventory		315.5			484.8
Prepaid expenses and other current assets		126.1			101.1
Total current assets		5,971.5			4,428.3
PROPERTY AND EQUIPMENT—NET		1,349.5			1,044.4
DEFERRED CONTRACT COSTS		622.9			605.6
DEFERRED TAX ASSETS		1,335.6			868.8
GOODWILL AND OTHER INTANGIBLE ASSETS—NET		350.4			161.8
OTHER ASSETS		133.2			150.0
TOTAL ASSETS	$	9,763.1		$	7,258.9
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
CURRENT LIABILITIES:
Accounts payable	$	190.9		$	204.3
Accrued liabilities		337.9			423.7
Accrued payroll and compensation		255.7			242.3
Deferred revenue		3,276.2			2,848.7
Total current liabilities		4,060.7			3,719.0
DEFERRED REVENUE		3,084.7			2,886.3
LONG-TERM DEBT		994.3			992.3
OTHER LIABILITIES		129.6			124.7
Total liabilities		8,269.3			7,722.3
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ EQUITY (DEFICIT):
Common stock		0.8			0.8
Additional paid-in capital		1,636.2			1,416.4
Accumulated other comprehensive loss		(26.1	)		(18.9	)
Accumulated deficit		(117.1	)		(1,861.7	)
Total stockholders’ equity (deficit)		1,493.8			(463.4	)
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)	$	9,763.1		$	7,258.9

FORTINET, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited, in millions, except per share amounts)

	Three Months Ended						Year Ended
	December 31, 2024			December 31, 2023			December 31, 2024			December 31, 2023
REVENUE:
Product	$	574.0		$	488.1		$	1,908.7		$	1,927.3
Service		1,086.1			927.0			4,047.1			3,377.5
Total revenue		1,660.1			1,415.1			5,955.8			5,304.8
COST OF REVENUE:
Product		178.0			197.2			652.0			763.6
Service		136.5			118.7			505.6			473.6
Total cost of revenue		314.5			315.9			1,157.6			1,237.2
GROSS PROFIT:
Product		396.0			290.9			1,256.7			1,163.7
Service		949.6			808.3			3,541.5			2,903.9
Total gross profit		1,345.6			1,099.2			4,798.2			4,067.6
OPERATING EXPENSES:
Research and development		191.1			152.5			716.8			613.8
Sales and marketing		526.5			507.4			2,044.8			2,006.0
General and administrative		55.1			55.1			237.8			211.3
Gain on intellectual property matter		(1.2	)		(1.2	)		(4.6	)		(4.6	)
Total operating expenses		771.5			713.8			2,994.8			2,826.5
OPERATING INCOME		574.1			385.4			1,803.4			1,241.1
INTEREST INCOME		42.3			30.5			155.2			119.7
INTEREST EXPENSE		(4.9	)		(5.4	)		(20.0	)		(21.0	)
GAIN ON BARGAIN PURCHASE		—			—			106.3			—
OTHER INCOME (EXPENSE)—NET		6.9			5.1			13.6			(6.1	)
INCOME BEFORE INCOME TAXES AND LOSS FROM EQUITY METHOD INVESTMENTS		618.4			415.6			2,058.5			1,333.7
PROVISION FOR INCOME TAXES		86.7			95.2			283.9			143.8
LOSS FROM EQUITY METHOD INVESTMENTS		(5.5	)		(9.5	)		(29.4	)		(42.1	)
NET INCOME	$	526.2		$	310.9		$	1,745.2		$	1,147.8
Net income per share:
Basic	$	0.69		$	0.41		$	2.28		$	1.47
Diluted	$	0.68		$	0.40		$	2.26		$	1.46
Weighted-average shares outstanding:
Basic		766.5			764.9			764.4			778.6
Diluted		775.2			772.3			771.9			788.2

FORTINET, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited, in millions)

	Year Ended
	December 31, 2024			December 31, 2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	1,745.2		$	1,147.8
Adjustments to reconcile net income to net cash provided by operating activities:
Stock-based compensation		257.9			249.0
Amortization of deferred contract costs		293.7			266.3
Depreciation and amortization		122.8			113.4
Amortization of investment discounts		(48.8	)		(27.7	)
Loss from equity method investments		29.4			42.1
Gain on bargain purchase		(106.3	)		—
Other		(15.2	)		18.5
Changes in operating assets and liabilities, net of impact of business combinations:
Accounts receivable—net		(45.4	)		(146.4	)
Inventory		131.2			(253.5	)
Prepaid expenses and other current assets		(13.7	)		(27.6	)
Deferred contract costs		(311.1	)		(353.5	)
Deferred tax assets		(223.2	)		(301.9	)
Other assets		(11.0	)		17.7
Accounts payable		(10.2	)		(43.1	)
Accrued liabilities		(106.7	)		137.4
Accrued payroll and compensation		—			23.4
Other liabilities		(8.3	)		(21.7	)
Deferred revenue		577.8			1,095.3
Net cash provided by operating activities		2,258.1			1,935.5
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of investments		(1,948.6	)		(1,855.8	)
Sales of investments		0.5			4.0
Maturities of investments		1,891.7			1,414.8
Purchases of property and equipment		(378.9	)		(204.1	)
Purchase of investment in privately held company		—			(8.5	)
Payments made in connection with business combinations, net of cash acquired		(275.5	)		—
Purchases of marketable equity securities		(16.7	)		—
Other		0.1			0.3
Net cash used in investing activities		(727.4	)		(649.3	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repurchase and retirement of common stock		(0.6	)		(1,500.5	)
Proceeds from issuance of common stock		63.1			43.8
Taxes paid related to net share settlement of equity awards		(100.9	)		(112.5	)
Other		(11.7	)		(1.2	)
Net cash used in financing activities		(50.1	)		(1,570.4	)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS		(2.6	)		(0.8	)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		1,478.0			(285.0	)
CASH AND CASH EQUIVALENTS—Beginning of year		1,397.9			1,682.9
CASH AND CASH EQUIVALENTS—End of year	$	2,875.9		$	1,397.9

Reconciliations of non-GAAP results of operations measures to the nearest comparable GAAP measures
(Unaudited, in millions, except per share amounts)

Reconciliation of GAAP operating income to non-GAAP operating income, operating margin, net income and diluted net income per share

	Three Months Ended						Year Ended
	December 31, 2024			December 31, 2023			December 31, 2024			December 31, 2023
Reconciliation of non-GAAP operating income:
GAAP operating income	$	574.1		$	385.4		$	1,803.4		$	1,241.1
GAAP operating margin		34.6	%		27.2	%		30.3	%		23.4	%
Add back:
Stock‐based compensation		66.5			64.0			260.2			251.6
Amortization of acquired intangible assets		11.5			5.3			23.1			18.9
Litigation-related matter ^(a)		—			—			3.2			—
Gain on intellectual property matter		(1.2	)		(1.2	)		(4.6	)		(4.6	)
Non‐GAAP operating income	$	650.9		$	453.5		$	2,085.3		$	1,507.0
Non‐GAAP operating margin		39.2	%		32.0	%		35.0	%		28.4	%

Reconciliation of non-GAAP net income:
GAAP net income	$	526.2		$	310.9		$	1,745.2		$	1,147.8
Add back:
Stock‐based compensation		66.5			64.0			260.2			251.6
Amortization of acquired intangible assets		11.5			5.3			23.1			18.9
Litigation-related matter ^(a)		—			—			3.2			—
Gain on intellectual property matter		(1.2	)		(1.2	)		(4.6	)		(4.6	)
Gain on bargain purchase ^(b)		—			—			(106.3	)		—
Tax adjustment ^(c)		(31.5	)		13.0			(95.9	)		(128.1	)
Non-cash charge on equity method investment ^(d)		—			—			8.0			—
Non-GAAP net income	$	571.5		$	392.0		$	1,832.9		$	1,285.6

Non-GAAP net income per share, diluted
Non-GAAP net income	$	571.5		$	392.0		$	1,832.9		$	1,285.6
Non-GAAP shares used in diluted net income per share calculations		775.2			772.3			771.9			788.2
Non-GAAP net income per share, diluted	$	0.74		$	0.51		$	2.37		$	1.63

Reconciliation of non-GAAP net income per share, diluted
GAAP net income per share, diluted	$	0.68		$	0.40		$	2.26		$	1.46
Add back:
Non-GAAP adjustments to net income per share		0.06			0.11			0.11			0.17
Non-GAAP net income per share, diluted	$	0.74		$	0.51		$	2.37		$	1.63

(a) To exclude a $3.2 million adjustment for a litigation settlement in the three months ended September 30, 2024.
(b) To exclude a $106.3 million gain on bargain purchase related to our acquisition of Lacework Inc in the three months ended September 30, 2024.
(c) Non-GAAP financial information is adjusted to an effective tax rate of 17% in the three months and year ended December 31, 2024 and 2023, respectively, on a non-GAAP basis, which differs from the GAAP effective tax rate.
(d) To exclude an $8.0 million non-cash charge of impairment on our equity method investment in Linksys.

Reconciliation of net cash provided by operating activities to free cash flow

	Three Months Ended						Year Ended
	December 31, 2024			December 31, 2023			December 31, 2024			December 31, 2023
Net cash provided by operating activities	$	477.6		$	191.7		$	2,258.1		$	1,935.5
Less: Purchases of property and equipment		(97.6	)		(26.9	)		(378.9	)		(204.1	)
Free cash flow	$	380.0		$	164.8		$	1,879.2		$	1,731.4
Net cash used in investing activities	$	(79.9	)	$	(71.6	)	$	(727.4	)	$	(649.3	)
Net cash used in financing activities	$	(8.8	)	$	(910.1	)	$	(50.1	)	$	(1,570.4	)

Reconciliation of total revenue to total billings

	Three Months Ended					Year Ended
	December 31, 2024			December 31, 2023		December 31, 2024			December 31, 2023
Total revenue	$	1,660.1		$	1,415.1	$	5,955.8		$	5,304.8
Add: Change in deferred revenue		349.2			449.7		625.9			1,094.7
Less: Deferred revenue balance acquired in business acquisitions		(6.8	)		—		(49.2	)		—
Total billings	$	2,002.5		$	1,864.8	$	6,532.5		$	6,399.5

Investor Contact:	Media Contact:

Aaron Ovadia	Michelle Zimmermann
Fortinet, Inc.	Fortinet, Inc.
408-235-7700	408-235-7700
investors@fortinet.com	pr@fortinet.com

The MIL Network –

February 7, 2025

MIL-OSI: DTE Energy names Casey Santos to board of directors

Source: GlobeNewswire (MIL-OSI)

Detroit, Feb. 06, 2025 (GLOBE NEWSWIRE) — DTE Energy (NYSE: DTE) has named Casey Santos to its board of directors effective Feb. 6. Santos recently joined Caliber as chief technology officer. Prior to Caliber, Santos led Asurion’s global technology and procurement teams as their chief information officer. She has more than 25 years of experience as an executive leader, an independent board director for public and private organizations, and advisor with expertise across a diverse range of industries, business lines and functions.

“We are pleased to welcome Casey to DTE Energy’s board of directors,” said Jerry Norcia, chairman and CEO of DTE Energy. “Her deep expertise in leading innovation, digital transformation, artificial intelligence and cybersecurity will be invaluable to DTE as we work to build the grid of the future and deliver safe, reliable, affordable and cleaner energy to our customers now and in the years to come.”

“DTE Energy’s mission to improve people’s lives with their energy directly aligns with my values,” Santos said. “Energy is essential to modern life, and I look forward to contributing my personal energy to serve millions of people in Michigan and across the United States.”

Prior to her work at Asurion, Santos held technology leadership roles in the finance industry and was a strategy consultant with McKinsey serving clients in the United States and Europe. Santos began her career as a NASA Flight Controller supporting over 20 space shuttle missions, including the first MIR docking and Hubble Telescope repair missions.

Santos earned a Bachelor of Science degree in aeronautics and astronautics from Massachusetts Institute of Technology and holds dual master’s degrees from the University of Pennsylvania, including a Master of Business Administration from the Wharton School and a Master of Arts in management from the Lauder Institute. She has been recognized for her contributions to the industry and community, most recently as a Top 100 Chief in Tech Leaders to Watch in 2024 by WomenTech Network, Nashville Technology Council’s CIO of the Year in 2023, and a HiTec 100 Leader in 2019 and 2023. She is a member of Latino Corporate Directors Association, Women Corporate Directors, NACD, and T200. She is the Board Chair of the Nashville Technology Council and works with non-profits to help advance STEM education and technology leadership.

About DTE Energy

DTE Energy (NYSE:DTE) is a Detroit-based diversified energy company involved in the development and management of energy-related businesses and services nationwide. Its operating units include an electric company serving 2.3 million customers in Southeast Michigan and a natural gas company serving 1.3 million customers across Michigan. The DTE portfolio also includes energy businesses focused on custom energy solutions, renewable energy generation, and energy marketing and trading. DTE has continued to accelerate its carbon reduction goals to meet aggressive targets and is committed to serving with its energy through volunteerism, education and employment initiatives, philanthropy, emission reductions and economic progress. Information about DTE is available at dteenergy.com, empoweringmichigan.com, x.com/DTE_Energy and facebook.com/dteenergy.

Attachment

Casey Santos

The MIL Network –

February 7, 2025

MIL-OSI: Microchip Technology Announces Financial Results for Third Quarter of Fiscal Year 2025

Source: GlobeNewswire (MIL-OSI)

Net sales of $1.026 billion, down 11.8% sequentially and down 41.9% from the year ago quarter. Our updated guidance provided on December 2, 2024 was net sales of $1.025 billion.
On a GAAP basis: gross profit of 54.7%; operating income of $30.9 million and 3.0% of net sales; net loss of $53.6 million; and loss of $0.10 per diluted share. Our guidance provided on November 5, 2024 was for GAAP earnings (loss) per share of $(0.04) to $0.03 per diluted share.
On a Non-GAAP basis: gross profit of 55.4%; operating income of $210.7 million and 20.5% of net sales; net income of $107.3 million; and EPS of $0.20 per diluted share. Our updated guidance provided on December 2, 2024 was for Non-GAAP EPS of $0.25 per diluted share.
Returned approximately $244.6 million to stockholders in the December quarter through dividends.
Quarterly dividend declared today for the March quarter of 45.5 cents per share, an increase of 1.1% from the year ago quarter.

CHANDLER, Ariz., Feb. 06, 2025 (GLOBE NEWSWIRE) — (NASDAQ: MCHP) – Microchip Technology Incorporated, a leading provider of smart, connected, and secure embedded control solutions, today reported results for the three months ended December 31, 2024, as summarized in the table below.

	Three Months Ended December 31, 2024⁽¹⁾
Net sales	$1,026.0
	GAAP	%	Non-GAAP⁽²⁾	%
Gross profit	$561.4	54.7%	$568.8	55.4%
Operating income	$30.9	3.0%	$210.7	20.5%
Other expense	$(77.0)		$(76.7)
Income tax provision	$7.5		$26.7
Net (loss) income	$(53.6)	(5.2)%	$107.3	10.5%
Net (loss) income per diluted share	$(0.10)		$0.20

⁽¹⁾ In millions, except per share amounts and percentages of net sales.
⁽²⁾ See the “Use of Non-GAAP Financial Measures” section of this release.

Net sales for the third quarter of fiscal 2025 were $1.026 billion, down 41.9% from net sales of $1.766 billion in the prior year’s third fiscal quarter.

GAAP net loss for the third quarter of fiscal 2025 was $53.6 million, or $0.10 per diluted share, down from GAAP net income of $419.2 million, or $0.77 per diluted share, in the prior year’s third fiscal quarter. For the third quarters of fiscal 2025 and fiscal 2024, GAAP results were adversely impacted by amortization of acquired intangible assets associated with our previous acquisitions.

Non-GAAP net income for the third quarter of fiscal 2025 was $107.3 million, or $0.20 per diluted share, down from non-GAAP net income of $592.7 million, or $1.08 per diluted share, in the prior year’s third fiscal quarter. For the third quarters of fiscal 2025 and fiscal 2024, our non-GAAP results exclude the effect of share-based compensation, expenses related to our acquisition activities (including intangible asset amortization, severance, and other restructuring costs, and legal and other general and administrative expenses associated with acquisitions including legal fees and expenses for litigation and investigations related to our Microsemi acquisition), professional services associated with certain legal matters, and losses on the settlement of debt. For the third quarters of fiscal 2025 and fiscal 2024, our non-GAAP income tax expense is presented based on projected cash taxes for the applicable fiscal year, excluding transition tax payments under the Tax Cuts and Jobs Act. A reconciliation of our non-GAAP and GAAP results is included in this press release.

Microchip announced today that its Board of Directors declared a quarterly cash dividend on its common stock of 45.5 cents per share, up 1.1% from the year ago quarter. The quarterly dividend is payable on March 7, 2025 to stockholders of record on February 24, 2025.

“Our December quarter performance reflects the need for the decisive steps we are taking to realign our business, as revenue declined to $1.026 billion and inventory levels reached 266 days,” said Steve Sanghi, Microchip’s CEO and President. “Since returning as CEO in November, we have already initiated several key actions, including restructuring our manufacturing footprint, adjusting our channel strategy and intensifying our customer engagement. Our initial assessment indicates clear areas for operational enhancement, and we are taking a methodical yet urgent approach to evaluating all aspects of our business and implementing necessary changes to strengthen our competitive position.”

Eric Bjornholt, Microchip’s Chief Financial Officer, said, “We are executing on multiple operational initiatives to enhance our financial performance. Our focus remains on returning to premium profitability levels that have historically differentiated Microchip, supported by our diversified business model. While navigating the current cycle, we continue to focus on inventory management while maintaining our commitment to shareholder returns.”

Rich Simoncic, Microchip’s Chief Operating Officer, said, “Our comprehensive technology platform is driving innovation across critical markets, with our new RISC-V processors and expanded connectivity solutions demonstrating strong momentum in industrial, automotive, and aerospace applications. By delivering advanced AI capabilities, enhanced networking, and robust security technologies, we believe we are well-positioned to meet the evolving needs of our customers in increasingly complex technological environments.”

Mr. Sanghi concluded, “While we have seen substantial inventory destocking at our customers and channel partners, we believe the correction cycle is still not completed. Our March quarter bookings are running at a higher rate than December, though overall levels remain low. With net sales guidance of $920.0 million to $1.000 billion for our March quarter, we maintain a cautious but focused approach and look forward to providing a comprehensive update during our business update call on March 3, 2025.”

Fourth Quarter Fiscal Year 2025 Outlook:

The following statements are based on current expectations. These statements are forward-looking, and actual results may differ materially.

	Microchip Consolidated Guidance
Net Sales	$920.0 million to $1.000 billion
	GAAP⁽⁵⁾	Non-GAAP Adjustments⁽¹⁾	Non-GAAP⁽¹⁾
Gross Profit	51.2% to 53.1%	$7.8 to $8.8 million	52.0% to 54.0%
Operating Expenses⁽²⁾	56.1% to 60.0%	$179.7 to $183.7 million	37.7% to 40.5%
Operating Income (loss)	(8.9)% to (2.9)%	$187.5 to $192.5 million	11.5% to 16.3%
Other Expense, net	$69.7 to $71.3 million	$(0.2) to $0.2 million	$69.5 to $71.5 million
Income Tax (Benefit) Provision	$(24.5) to $(19.8) million⁽³⁾	$29.5 to $33.4 million	$5.0 to $13.6 million⁽⁴⁾
Net Income (loss)	$(128.5) to $(79.4) million	$157.8 to $159.3 million	$29.3 to $79.9 million
Diluted Common Shares Outstanding	Approximately 538.4 million shares		Approximately 541.5 to 542.5 million shares
Earnings (loss) per Diluted Share	$(0.24) to $(0.14)	$0.29	$0.05 to $0.15

⁽¹⁾ See the “Use of Non-GAAP Financial Measures” section of this release for information regarding our non-GAAP guidance.
⁽²⁾ We are not able to estimate the amount of certain Special Charges and Other, net that may be incurred during the quarter ending March 31, 2025. Therefore, our estimate of GAAP operating expenses excludes certain amounts that may be recognized as Special Charges and Other, net in the quarter ending March 31, 2025.
⁽³⁾ The forecast for GAAP tax expense excludes any unexpected tax events that may occur during the quarter, as these amounts cannot be forecasted.
⁽⁴⁾ Represents the expected cash tax rate for fiscal 2025, excluding any transition tax payments associated with the Tax Cuts and Jobs Act.
⁽⁵⁾ Our GAAP guidance excludes the impact of any potential charges related to our ongoing evaluation of restructuring activities.

Capital expenditures for the quarter ending March 31, 2025 are expected to be about $23 million. Capital expenditures for all of fiscal 2025 are expected to be about $135 million. Consistent with the slowing macroeconomic environment in fiscal 2025, we have paused most of our factory expansion actions and reduced our planned capital investments through fiscal 2026. However, we are adding capital equipment to selectively expand our production capacity and add research and development equipment.

Under the GAAP revenue recognition standard, we are required to recognize revenue when control of the product changes from us to a customer or distributor. We focus our sales and marketing efforts on creating demand for our products in the end markets we serve and not on moving inventory into our distribution network. We also manage our manufacturing and supply chain operations, including our distributor relationships, towards the goal of having our products available at the time and location the end customer desires.

Use of Non-GAAP Financial Measures: Our non-GAAP adjustments, where applicable, include the effect of share-based compensation, expenses related to our acquisition activities (including intangible asset amortization, severance, and other restructuring costs, and legal and other general and administrative expenses associated with acquisitions including legal fees and expenses for litigation and investigations related to our Microsemi acquisition), professional services associated with certain legal matters, and losses on the settlement of debt. For the third quarters of fiscal 2025 and fiscal 2024, our non-GAAP income tax expense is presented based on projected cash taxes for the fiscal year, excluding transition tax payments under the Tax Cuts and Jobs Act.

We are required to estimate the cost of certain forms of share-based compensation, including employee stock options, restricted stock units, and our employee stock purchase plan, and to record a commensurate expense in our income statement. Share-based compensation expense is a non-cash expense that varies in amount from period to period and is affected by the price of our stock at the date of grant. The price of our stock is affected by market forces that are difficult to predict and are not within the control of management. Our other non-GAAP adjustments are either non-cash expenses, unusual or infrequent items, or other expenses related to transactions. Management excludes all of these items from its internal operating forecasts and models.

We are using non-GAAP operating expenses in dollars, including non-GAAP research and development expenses and non-GAAP selling, general and administrative expenses, non-GAAP other expense, net, and non-GAAP income tax rate, which exclude the items noted above, as applicable, to permit additional analysis of our performance.

Management believes these non-GAAP measures are useful to investors because they enhance the understanding of our historical financial performance and comparability between periods. Many of our investors have requested that we disclose this non-GAAP information because they believe it is useful in understanding our performance as it excludes non-cash and other charges that many investors feel may obscure our underlying operating results. Management uses non-GAAP measures to manage and assess the profitability of our business and for compensation purposes. We also use our non-GAAP results when developing and monitoring our budgets and spending. Our determination of these non-GAAP measures might not be the same as similarly titled measures used by other companies, and it should not be construed as a substitute for amounts determined in accordance with GAAP. There are limitations associated with using these non-GAAP measures, including that they exclude financial information that some may consider important in evaluating our performance. Management compensates for this by presenting information on both a GAAP and non-GAAP basis for investors and providing reconciliations of the GAAP and non-GAAP results.

Generally, gross profit fluctuates over time, driven primarily by the mix of products sold and licensing revenue; variances in manufacturing yields; fixed cost absorption; wafer fab loading levels; costs of wafers from foundries; inventory reserves; pricing pressures in our non-proprietary product lines; and competitive and economic conditions. Operating expenses fluctuate over time, primarily due to net sales and profit levels.

Diluted Common Shares Outstanding can vary for, among other things, the trading price of our common stock, the exercise of options or vesting of restricted stock units, the potential for incremental dilutive shares from our convertible debentures (additional information regarding our share count is available in the investor relations section of our website under the heading “Supplemental Information”), and repurchases or issuances of shares of our common stock. The diluted common shares outstanding presented in the guidance table above assumes an average Microchip stock price in the March 2025 quarter between $55 and $65 per share (however, we make no prediction as to what our actual share price will be for such period or any other period and we cannot estimate what our stock option exercise activity will be during the quarter).


MICROCHIP TECHNOLOGY INCORPORATED AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in millions, except per share amounts; unaudited)

	Three Months Ended December 31,						Nine Months Ended December 31,
		2024			2023			2024			2023
Net sales	$	1,026.0		$	1,765.7		$	3,431.1		$	6,308.6
Cost of sales		464.6			645.7			1,464.3			2,102.8
Gross profit		561.4			1,120.0			1,966.8			4,205.8

Research and development		246.2			266.0			728.6			857.1
Selling, general and administrative		158.2			172.2			465.7			572.4
Amortization of acquired intangible assets		122.6			151.3			368.3			454.2
Special charges and other, net		3.5			1.1			7.6			4.6
Operating expenses		530.5			590.6			1,570.2			1,888.3

Operating income		30.9			529.4			396.6			2,317.5

Other expense, net		(77.0	)		(45.1	)		(189.4	)		(151.3	)
(Loss) income before income taxes		(46.1	)		484.3			207.2			2,166.2
Income tax provision		7.5			65.1			53.1			414.0
Net (loss) income	$	(53.6	)	$	419.2		$	154.1		$	1,752.2

Basic net (loss) income per common share	$	(0.10	)	$	0.78		$	0.29		$	3.23
Diluted net (loss) income per common share	$	(0.10	)	$	0.77		$	0.28		$	3.19

Basic common shares outstanding		537.4			540.8			536.9			543.0
Diluted common shares outstanding		537.4			546.5			542.1			549.0


MICROCHIP TECHNOLOGY INCORPORATED AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (in millions; unaudited)

ASSETS
	December 31,		March 31,
		2024		2024
Cash and short-term investments	$	586.0	$	319.7
Accounts receivable, net		857.2		1,143.7
Inventories		1,356.3		1,316.0
Other current assets		196.3		233.6
Total current assets		2,995.8		3,013.0

Property, plant and equipment, net		1,152.1		1,194.6
Other assets		11,484.3		11,665.6
Total assets	$	15,632.2	$	15,873.2

LIABILITIES AND STOCKHOLDERS’ EQUITY

Accounts payable and accrued liabilities	$	1,330.3	$	1,520.0
Current portion of long-term debt		—		999.4
Total current liabilities		1,330.3		2,519.4

Long-term debt		6,749.5		5,000.4
Long-term income tax payable		598.7		649.2
Long-term deferred tax liability		22.9		28.8
Other long-term liabilities		899.3		1,017.6

Stockholders’ equity		6,031.5		6,657.8
Total liabilities and stockholders’ equity	$	15,632.2	$	15,873.2

MICROCHIP TECHNOLOGY INCORPORATED AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
(in millions, except per share amounts and percentages; unaudited)

RECONCILIATION OF GAAP GROSS PROFIT TO NON-GAAP GROSS PROFIT

	Three Months Ended December 31,						Nine Months Ended December 31,
		2024			2023			2024			2023
Gross profit, as reported	$	561.4		$	1,120.0		$	1,966.8		$	4,205.8
Share-based compensation expense		7.4			6.0			18.3			20.2
Cybersecurity incident expenses		—			—			20.1			—
Non-GAAP gross profit	$	568.8		$	1,126.0		$	2,005.2		$	4,226.0
GAAP gross profit percentage		54.7	%		63.4	%		57.3	%		66.7	%
Non-GAAP gross profit percentage		55.4	%		63.8	%		58.4	%		67.0	%

RECONCILIATION OF GAAP RESEARCH AND DEVELOPMENT EXPENSES TO NON-GAAP RESEARCH AND DEVELOPMENT EXPENSES

	Three Months Ended December 31,						Nine Months Ended December 31,
		2024			2023			2024			2023
Research and development expenses, as reported	$	246.2		$	266.0		$	728.6		$	857.1
Share-based compensation expense		(28.8	)		(24.4	)		(79.0	)		(71.0	)
Other adjustments		—			(0.1	)		—			(0.5	)
Non-GAAP research and development expenses	$	217.4		$	241.5		$	649.6		$	785.6
GAAP research and development expenses as a percentage of net sales		24.0	%		15.1	%		21.2	%		13.6	%
Non-GAAP research and development expenses as a percentage of net sales		21.2	%		13.7	%		18.9	%		12.5	%

RECONCILIATION OF GAAP SELLING, GENERAL AND ADMINISTRATIVE EXPENSES TO NON-GAAP SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

	Three Months Ended December 31,						Nine Months Ended December 31,
		2024			2023			2024			2023
Selling, general and administrative expenses, as reported	$	158.2		$	172.2		$	465.7		$	572.4
Share-based compensation expense		(13.2	)		(14.4	)		(42.4	)		(43.5	)
Cybersecurity incident expenses		—			—			(1.3	)		—
Other adjustments		(3.9	)		(1.0	)		(7.3	)		(0.5	)
Professional services associated with certain legal matters		(0.4	)		(0.4	)		(1.1	)		(1.2	)
Non-GAAP selling, general and administrative expenses	$	140.7		$	156.4		$	413.6		$	527.2
GAAP selling, general and administrative expenses as a percentage of net sales		15.4	%		9.8	%		13.6	%		9.1	%
Non-GAAP selling, general and administrative expenses as a percentage of net sales		13.7	%		8.9	%		12.1	%		8.4	%

RECONCILIATION OF GAAP OPERATING EXPENSES TO NON-GAAP OPERATING EXPENSES

	Three Months Ended December 31,						Nine Months Ended December 31,
		2024			2023			2024			2023
Operating expenses, as reported	$	530.5		$	590.6		$	1,570.2		$	1,888.3
Share-based compensation expense		(42.0	)		(38.8	)		(121.4	)		(114.5	)
Cybersecurity incident expenses		—			—			(1.3	)		—
Other adjustments		(3.9	)		(1.1	)		(7.3	)		(1.0	)
Professional services associated with certain legal matters		(0.4	)		(0.4	)		(1.1	)		(1.2	)
Amortization of acquired intangible assets ⁽¹⁾		(122.6	)		(151.3	)		(368.3	)		(454.2	)
Special charges and other, net		(3.5	)		(1.1	)		(7.6	)		(4.6	)
Non-GAAP operating expenses	$	358.1		$	397.9		$	1,063.2		$	1,312.8
GAAP operating expenses as a percentage of net sales		51.7	%		33.4	%		45.8	%		29.9	%
Non-GAAP operating expenses as a percentage of net sales		34.9	%		22.5	%		31.0	%		20.8	%

⁽¹⁾ Amortization of acquired intangible assets consists of core and developed technology and customer-related acquired intangible assets in connection with business combinations. Such charges are excluded for purposes of calculating certain non-GAAP measures.

RECONCILIATION OF GAAP OPERATING INCOME TO NON-GAAP OPERATING INCOME

	Three Months Ended December 31,						Nine Months Ended December 31,
		2024			2023			2024			2023
Operating income, as reported	$	30.9		$	529.4		$	396.6		$	2,317.5
Share-based compensation expense		49.4			44.8			139.7			134.7
Cybersecurity incident expenses		—			—			21.4			—
Other adjustments		3.9			1.1			7.3			1.0
Professional services associated with certain legal matters		0.4			0.4			1.1			1.2
Amortization of acquired intangible assets ⁽¹⁾		122.6			151.3			368.3			454.2
Special charges and other, net		3.5			1.1			7.6			4.6
Non-GAAP operating income	$	210.7		$	728.1		$	942.0		$	2,913.2
GAAP operating income as a percentage of net sales		3.0	%		30.0	%		11.6	%		36.7	%
Non-GAAP operating income as a percentage of net sales		20.5	%		41.2	%		27.5	%		46.2	%

⁽¹⁾ Amortization of acquired intangible assets consists of core and developed technology and customer-related acquired intangible assets in connection with business combinations. Such charges are excluded for purposes of calculating certain non-GAAP measures. The use of acquired intangible assets contributed to our revenues earned during the periods presented.

RECONCILIATION OF GAAP OTHER EXPENSE, NET TO NON-GAAP OTHER EXPENSE, NET

	Three Months Ended December 31,						Nine Months Ended December 31,
		2024			2023			2024			2023
Other expense, net, as reported	$	(77.0	)	$	(45.1	)	$	(189.4	)	$	(151.3	)
Loss on settlement of debt		0.3			—			0.3			12.2
Loss on available-for-sale investments		—			—			1.8			—
Non-GAAP other expense, net	$	(76.7	)	$	(45.1	)	$	(187.3	)	$	(139.1	)
GAAP other expense, net, as a percentage of net sales	(7.5		)%	(2.6		)%	(5.5		)%	(2.4		)%
Non-GAAP other expense, net, as a percentage of net sales	(7.5		)%	(2.6		)%	(5.5		)%	(2.2		)%

RECONCILIATION OF GAAP INCOME TAX PROVISION TO NON-GAAP INCOME TAX PROVISION

	Three Months Ended December 31,						Nine Months Ended December 31,
		2024			2023			2024			2023
Income tax provision as reported	$	7.5		$	65.1		$	53.1		$	414.0
Income tax rate, as reported	(16.3		)%		13.4	%		25.6	%		19.1	%
Other non-GAAP tax adjustment		19.2			25.2			54.2			(27.2	)
Non-GAAP income tax provision	$	26.7		$	90.3		$	107.3		$	386.8
Non-GAAP income tax rate		19.9	%		13.2	%		14.2	%		13.9	%

RECONCILIATION OF GAAP NET (LOSS) INCOME AND GAAP DILUTED NET (LOSS) INCOME PER COMMON SHARE TO NON-GAAP NET INCOME AND NON-GAAP DILUTED NET INCOME PER COMMON SHARE

	Three Months Ended December 31,						Nine Months Ended December 31,
		2024			2023			2024			2023
Net (loss) income, as reported	$	(53.6	)	$	419.2		$	154.1		$	1,752.2
Share-based compensation expense		49.4			44.8			139.7			134.7
Cybersecurity incident expenses		—			—			21.4			—
Other adjustments		3.9			1.1			7.3			1.0
Professional services associated with certain legal matters		0.4			0.4			1.1			1.2
Amortization of acquired intangible assets		122.6			151.3			368.3			454.2
Special charges and other, net		3.5			1.1			7.6			4.6
Loss on settlement of debt		0.3			—			0.3			12.2
Loss on available-for-sale investments		—			—			1.8			—
Other non-GAAP tax adjustment		(19.2	)		(25.2	)		(54.2	)		27.2
Non-GAAP net income	$	107.3		$	592.7		$	647.4		$	2,387.3
GAAP net (loss) income as a percentage of net sales	(5.2		)%		23.7	%		4.5	%		27.8	%
Non-GAAP net income as a percentage of net sales		10.5	%		33.6	%		18.9	%		37.8	%
Diluted net (loss) income per common share, as reported	$	(0.10	)	$	0.77		$	0.28		$	3.19
Non-GAAP diluted net income per common share	$	0.20		$	1.08		$	1.19		$	4.35
Diluted common shares outstanding, as reported		537.4			546.5			542.1			549.0
Diluted common shares outstanding non-GAAP		541.6			546.5			542.1			549.0

RECONCILIATION OF GAAP CASH FLOW FROM OPERATIONS TO FREE CASH FLOW

	Three Months Ended December 31,						Nine Months Ended December 31,
		2024			2023			2024			2023
GAAP cash flow from operations, as reported	$	271.5		$	853.3		$	692.2		$	2,462.7
Capital expenditures		(18.1	)		(59.5	)		(111.8	)		(245.0	)
Free cash flow	$	253.4		$	793.8		$	580.4		$	2,217.7
GAAP cash flow from operations as a percentage of net sales		26.5	%		48.3	%		20.2	%		39.0	%
Free cash flow as a percentage of net sales		24.7	%		45.0	%		16.9	%		35.2	%

Microchip will host a conference call today, February 6, 2025 at 5:00 p.m. (Eastern Time) to discuss this release. This call will be simulcast over the Internet at www.microchip.com. The webcast will be available for replay until February 27, 2025.

A telephonic replay of the conference call will be available at approximately 8:00 p.m. (Eastern Time) on February 6, 2025 and will remain available until 5:00 p.m. (Eastern Time) on February 27, 2025. Interested parties may listen to the replay by dialing 201-612-7415/877-660-6853 and entering access code 13750989.

Cautionary Statement:
The statements in this release relating to the decisive steps we are taking to realign our business, restructuring our manufacturing footprint, adjusting our channel strategy and intensifying our customer engagement, clear areas for operational enhancements, taking a methodical yet urgent approach to evaluating all aspects of our business and implementing necessary changes to strengthen our competitive position, executing on multiple operational initiatives to enhance our financial performance, that our focus remains on returning to premium profitability levels that have historically differentiated Microchip, supported by our diversified business model, that we continue to focus on inventory management while maintaining our commitment to shareholder returns, that our comprehensive technology platform is driving innovation across critical markets, with our new RISC-V processors and expanded connectivity solutions demonstrating strong momentum in industrial, automotive, and aerospace applications, that we believe we are well-positioned to meet the evolving needs of our customers in increasingly complex technological environments, that we believe the correction cycle is still not completed, our net sales guidance of $920.0 million to $1.000 billion for our March 2025 quarter, that we maintain a cautious but focused approach, our fourth quarter fiscal 2025 guidance for net sales and GAAP and non-GAAP gross profit, operating expenses, operating income (loss), other expense, net, income tax (benefit) provision, net income (loss), diluted common shares outstanding, earnings (loss) per diluted share, capital expenditures for the March 2025 quarter and for all of fiscal 2025, adding capital equipment to selectively expand our production capacity and add research and development equipment, our belief that non-GAAP measures are useful to investors and our assumed average stock price in the March 2025 quarter are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties that could cause our actual results to differ materially, including, but not limited to: any continued uncertainty, fluctuations or weakness in the U.S. and world economies (including China and Europe) due to changes in interest rates or high inflation, actions taken or which may be taken by the Trump administration or the new U.S. Congress, monetary policy, political, geopolitical, trade or other issues in the U.S. or internationally (including the military conflicts in Ukraine-Russia and the Middle East), further changes in demand or market acceptance of our products and the products of our customers and our ability to respond to any increases or decreases in market demand or customer

requests to reschedule or cancel orders; the mix of inventory we hold, our ability to satisfy any short-term orders from our inventory and our ability to effectively manage our inventory levels; foreign currency effects on our business; changes in utilization of our manufacturing capacity and our ability to effectively manage our production levels to meet any increases or decreases in market demand or any customer requests to reschedule or cancel orders; the impact of inflation on our business; competitive developments including pricing pressures; the level of orders that are received and can be shipped in a quarter; our ability to realize the expected benefits of our long-term supply assurance program; changes or fluctuations in customer order patterns and seasonality; our ability to effectively manage our supply of wafers from third party wafer foundries to meet any decreases or increases in our needs and the cost of such wafers, our ability to obtain additional capacity from our suppliers to increase production to meet any future increases in market demand; our ability to successfully integrate the operations and employees, retain key employees and customers and otherwise realize the expected synergies and benefits of our acquisitions; the impact of any future significant acquisitions or strategic transactions we may make; the costs and outcome of any current or future litigation or other matters involving our acquisitions (including the acquired business, intellectual property, customers, or other issues); the costs and outcome of any current or future tax audit or investigation regarding our business or our acquired businesses; the impact that the CHIPS Act will have on increasing manufacturing capacity in our industry by providing incentives for us, our competitors and foundries to build new wafer manufacturing facilities or expand existing facilities; the amount and timing of any incentives we may receive under the CHIPS Act, the impact of current and future changes in U.S. corporate tax laws (including the Inflation Reduction Act of 2022 and the Tax Cuts and Jobs Act of 2017); fluctuations in our stock price and trading volume which could impact the number of shares we acquire under our share repurchase program and the timing of such repurchases; disruptions in our business or the businesses of our customers or suppliers due to natural disasters (including any floods in Thailand), terrorist activity, armed conflict, war, worldwide oil prices and supply, public health concerns or disruptions in the transportation system; and general economic, industry or political conditions in the United States or internationally.

For a detailed discussion of these and other risk factors, please refer to Microchip’s filings on Forms 10-K and 10-Q. You can obtain copies of Forms 10-K and 10-Q and other relevant documents for free at Microchip’s website (www.microchip.com) or the SEC’s website (www.sec.gov) or from commercial document retrieval services.

Stockholders of Microchip are cautioned not to place undue reliance on our forward-looking statements, which speak only as of the date such statements are made. Microchip does not undertake any obligation to publicly update any forward-looking statements to reflect events, circumstances or new information after this February 6, 2025 press release, or to reflect the occurrence of unanticipated events.

About Microchip:

Microchip Technology Incorporated is a leading provider of smart, connected and secure embedded control solutions. Its easy-to-use development tools and comprehensive product portfolio enable customers to create optimal designs, which reduce risk while lowering total system cost and time to market. Our solutions serve approximately 112,000 customers across the industrial, automotive, consumer, aerospace and defense, communications and computing markets. Headquartered in Chandler, Arizona, Microchip offers outstanding technical support along with dependable delivery and quality. For more information, visit the Microchip website at www.microchip.com.

Note: The Microchip name and logo are registered trademarks of Microchip Technology Incorporated in the U.S.A. and other countries. All other trademarks mentioned herein are the property of their respective companies.

INVESTOR RELATIONS CONTACT:

Sajid Daudi — Head of investor Relations….. (480) 792-7385

The MIL Network –

February 7, 2025

MIL-OSI: Former U.S. Senator Joe Manchin to Serve as Adviser to Apollo and Appointed to Athene Board of Directors

Source: GlobeNewswire (MIL-OSI)

WEST DES MOINES, Iowa, Feb. 06, 2025 (GLOBE NEWSWIRE) — Apollo (NYSE: APO) and Athene Holding Ltd. (“Athene”), today announced that former U.S. Senator Joseph Manchin III has been named an adviser to Apollo and appointed to the Athene Board of Directors, effective February 3, 2025. Senator Manchin will provide advisory services to Apollo on various matters including energy markets, given the firm’s leading role in providing capital to enable the global industrial renaissance.

Senator Manchin served as a United States Senator for West Virginia from 2010 to 2025. He was Chair of the Senate Energy and Natural Resources Committee, as well as a member of the Appropriations, Armed Services, and Veterans’ Affairs Committees. Prior to his tenure in the Senate, he served as the 34th Governor of West Virginia from 2005 to 2010 and as West Virginia Secretary of State from 2001 to 2005. He graduated from West Virginia University with a degree in business administration.

Marc Rowan, CEO of Apollo, said, “Senator Manchin’s distinguished career experience and expertise will be incredibly valuable to Apollo and our clients and partners. We look forward to his contributions to help meet the unprecedented capital need required to drive the global industrial renaissance and support the significant retirement needs of Americans and families around the globe.”

Jim Belardi, CEO of Athene, said, “Senator Manchin is a great addition to Athene’s Board as we address the significant need for next generation retirement products. His public sector experience, expertise on a broad range of issues, and track record of independent thinking make him a valuable member of our Board.”

Senator Manchin said, “Apollo is a forward-thinking financial services firm that has been able to offer capital at scale to drive the American economy forward. Athene provides critical retirement services to millions of Americans and is the leading innovator in tackling modern retirement challenges. I look forward to bringing a unique perspective to both the team at Apollo and the Athene Board, contributing to the firm’s continued success in retirement services and providing capital to enable energy accretion and transition.”

About Athene
Athene is a leading retirement services company with over $350 billion of total assets as of September 30, 2024, and operations in the United States, Bermuda, Canada, and Japan. Athene is focused on providing financial security to individuals by offering an attractive suite of retirement income and savings products and also serves as a solutions provider to corporations. For more information, please visit www.athene.com.

About Apollo
Apollo is a high-growth, global alternative asset manager. In our asset management business, we seek to provide our clients excess return at every point along the risk-reward spectrum from investment grade credit to private equity. For more than three decades, our investing expertise across our fully integrated platform has served the financial return needs of our clients and provided businesses with innovative capital solutions for growth. Through Athene, our retirement services business, we specialize in helping clients achieve financial security by providing a suite of retirement savings products and acting as a solutions provider to institutions. Our patient, creative, and knowledgeable approach to investing aligns our clients, businesses we invest in, our employees, and the communities we impact, to expand opportunity and achieve positive outcomes. As of December 31, 2024, Apollo had approximately $751 billion of assets under management. To learn more, please visit www.apollo.com.

Contacts:

Joanna Rose
Global Head of Corporate Communications
Apollo Global Management, Inc.
212-822-0491
communications@apollo.com

Jeanne Hess
Vice President, External Relations
Athene
646-768-7319
jeanne.hess@athene.com

The MIL Network –

February 7, 2025

MIL-OSI: Greystone Housing Impact Investors LP Schedules Fourth Quarter 2024 Earnings Conference Call for Thursday, February 20, 2025 at 4:30 p.m. Eastern Time

Source: GlobeNewswire (MIL-OSI)

OMAHA, Neb., Feb. 06, 2025 (GLOBE NEWSWIRE) — Greystone Housing Impact Investors LP (NYSE: GHI) (the “Partnership”) announced today that it will host a conference call for investors on Thursday, February 20, 2025 at 4:30 p.m. Eastern Time to discuss the Partnership’s Fourth Quarter 2024 results.

For those interested in participating in the question-and-answer session, participants may dial-in toll free at (877) 407-8813. International participants may dial-in at +1 (201) 689-8521. No pin or code number is needed.

The call is also being webcast live in listen-only mode. The webcast can be accessed via the Partnership’s website under “Events & Presentations” or via the following link: https://event.choruscall.com/mediaframe/webcast.html?webcastid=T0wdPGmd

It is recommended that you join 15 minutes before the conference call begins (although you may register, dial-in or access the webcast at any time during the call).

A recorded replay of the webcast will be made available on the Partnership’s Investor Relations website at http://www.ghiinvestors.com.

About Greystone Housing Impact Investors LP

Greystone Housing Impact Investors LP was formed in 1998 under the Delaware Revised Uniform Limited Partnership Act for the primary purpose of acquiring, holding, selling and otherwise dealing with a portfolio of mortgage revenue bonds which have been issued to provide construction and/or permanent financing for affordable multifamily, seniors and student housing properties. The Partnership is pursuing a business strategy of acquiring additional mortgage revenue bonds and other investments on a leveraged basis. The Partnership expects and believes the interest earned on these mortgage revenue bonds is excludable from gross income for federal income tax purposes. The Partnership seeks to achieve its investment growth strategy by investing in additional mortgage revenue bonds and other investments as permitted by its Second Amended and Restated Limited Partnership Agreement, dated December 5, 2022, taking advantage of attractive financing structures available in the securities market, and entering into interest rate risk management instruments. Greystone Housing Impact Investors LP press releases are available at www.ghiinvestors.com.

Safe Harbor Statement

Information contained in this press release contains “forward-looking statements,” which are based on current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially. These risks and uncertainties include, but are not limited to, risks involving current maturities of our financing arrangements and our ability to renew or refinance such maturities, fluctuations in short-term interest rates, collateral valuations, mortgage revenue bond investment valuations and overall economic and credit market conditions. For a further list and description of such risks, see the reports and other filings made by the Partnership with the Securities and Exchange Commission, including but not limited to, its Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K. Readers are urged to consider these factors carefully in evaluating the forward-looking statements. The Partnership disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

CONTACT:
Ken Rogozinski
Chief Executive Officer
402-952-1235

The MIL Network –

February 7, 2025

MIL-OSI: ESCO Reports First Quarter Fiscal 2025 Results

Source: GlobeNewswire (MIL-OSI)

St. Louis, Feb. 06, 2025 (GLOBE NEWSWIRE) — ESCO Technologies Inc. (NYSE: ESE) (ESCO, or the Company) today reported its operating results for the first quarter ended December 31, 2024 (Q1 2025).

Operating Highlights

Q1 2025 Sales increased $28.7 million (13.2 percent) to $247.0 million compared to $218.3 million in Q1 2024.
Q1 2025 Entered Orders were $275.0 million for a book-to-bill ratio of 1.11x, resulting in record backlog of $907 million.
Q1 2025 GAAP EPS increased 54 percent to $0.91 per share compared to $0.59 per share in Q1 2024.
Q1 2025 Adjusted EPS as defined in prior guidance increased 48 percent to $0.92 per share compared to $0.62 per share in Q1 2024.
Beginning in Q1 2025 we are excluding acquisition related amortization (which was $0.15 per share in Q1 2025) from our Adjusted EPS calculation. Q1 2025 Adjusted EPS excluding acquisition related amortization increased 41 percent to $1.07 per share compared to $0.76 per share in Q1 2024.
Net cash provided by operating activities was $34 million in Q1 2025, an increase of $25 million compared to the prior year period, as cash flow was positively impacted by higher net earnings and favorable working capital impacts.

Bryan Sayler, Chief Executive Officer and President, commented, “Our fiscal year got off to an outstanding start as we delivered 13 percent top line growth, over 200 basis points of Adjusted EBITDA margin expansion, and a 41 percent increase in Adjusted EPS compared to the prior year. All three segments delivered solid revenue growth, highlighted by notable strength across our Navy, commercial aerospace and utility end-markets. It was also great to see our Test business deliver a solid quarter with improving order flow, double digit revenue growth, and over 500 basis points of margin expansion.

“The ESCO team continues to build upon our strong position in attractive markets to increase value across the enterprise. Overall, it was a great way to start the year, with continuing momentum across our end markets giving us the confidence to raise our full year earnings guidance.”

Segment Performance

Aerospace & Defense (A&D)

Sales increased $19.6 million (21 percent) to $114.3 million in Q1 2025 from $94.7 million in Q1 2024. The Q1 increase was driven by strength in Navy and commercial aerospace, partially offset by lower defense aerospace.
Q1 2025 EBIT and Adjusted EBIT both increased $4.9 million to $21.6 million (18.9 percent margin) from $16.7 million (17.6 percent margin) in Q1 2024. Margin improvement was driven by leverage on higher volume and price increases, partially offset by inflationary pressures and mix.
Entered Orders decreased $51 million (30 percent) to $121 million in Q1 2025 compared to $172 million in Q1 2024. The decrease in orders was primarily driven by large Navy orders for Virginia Class Block V surface hull tiles and Block VI long lead material procurement for the Light-Weight Wide Aperture Array (LWWAA) in Q1 2024, partially offset by higher Q1 2025 Navy ejection valve and spares orders. Orders in the quarter resulted in a segment book-to-bill of 1.06x and record ending backlog of $607 million.

Utility Solutions Group (USG)

Sales increased $3.7 million (4 percent) to $86.7 million in Q1 2025 from $83.0 million in Q1 2024. Doble’s sales increased by $7.9 million (12 percent) driven by a strong quarter for offline and protection testing products and services. NRG sales decreased $4.2 million (22 percent) due to moderation in renewable energy projects in the quarter.
EBIT increased $2.9 million in Q1 2025 to $20.5 million from $17.6 million in Q1 2024. Adjusted EBIT increased $2.8 million to $20.5 million (23.6 percent margin) from $17.7 million (21.4 percent margin) in Q1 2024. Margin was favorably impacted by leverage on higher volume, price increases, and mix, partially offset by inflationary pressures.
Entered Orders increased $13 million (16 percent) to $90 million in Q1 2025. Doble orders increased by $10 million (15 percent) on strength across their product portfolio and highlighted by a $4.3 million order for offline test equipment at Phenix. NRG orders increased by $3 million in the quarter. The segment book-to-bill was 1.03x in the quarter and resulted in an ending backlog of $123 million.

RF Test & Measurement (Test)

Sales increased $5.5 million (13 percent) to $46.1 million in Q1 2025 from $40.6 million in Q1 2024. Sales growth primarily related to higher U.S. shielding, Test and Measurement in EMEA, and MPE filter sales.
EBIT increased $2.6 million in Q1 2025 to $4.4 million from $1.8 million in Q1 2024. Adjusted EBIT increased $2.8 million in Q1 2025 to $4.9 million (10.6 percent margin) from $2.1 million (5.1 percent margin) in Q1 2024. Margin was favorably impacted by leverage on higher volume, price increases, and cost reduction efforts, partially offset by inflationary pressures and mix.
Entered Orders increased $20 million (43 percent) to $65 million in Q1 2025. The increase was driven by a strong quarter for EMC Test & Measurement, A&D, and medical and industrial shielding orders. The segment book-to-bill was 1.41x in the quarter and resulted in ending backlog of $177 million.

Business Outlook – 2025
Beginning in Q1 2025, acquisition related amortization will be excluded from our Adjusted Earnings calculation. Our current assessment of FY 2025 acquisition related amortization does not include the impact of the pending SM&P acquisition. The initial fiscal 2025 guidance issued in our November press release is revised as follows:

	Guidance Range
November FY 2025 Adjusted EPS Guidance	$	4.70	$	4.90
Acquisition Related Amortization	$	0.60	$	0.60
Revised November FY 2025 Adjusted EPS Guidance	$	5.30	$	5.50

Due to strong market conditions and continued improvement in operational performance, we are raising our full-year guidance by $0.25 to a range of $5.55 to $5.75 (16 to 21 percent growth over the prior year) from $5.30 to $5.50. This guidance is in line with our initial revenue guidance range of $1.09 to $1.11 billion (6 to 8 percent annual growth).

	Guidance Range
Revised November FY 2025 Adjusted EPS Guidance	$	5.30	$	5.50
Guidance Increase	$	0.25	$	0.25
Revised FY 2025 Adjusted EPS Guidance	$	5.55	$	5.75

Management’s current expectation is for Q2 Adjusted EPS in the range of $1.20 to $1.30, which represents 10 to 19 percent growth over the prior year quarter.

	Guidance Range
Q2 2025 Adjusted EPS Guidance (prior methodology)	$	1.05	$	1.15
Acquisition Related Amortization	$	0.15	$	0.15
Q2 2025 Adjusted EPS Guidance	$	1.20	$	1.30

SM&P Acquisition
As announced on July 8, 2024, ESCO has agreed to acquire the Signature Management & Power (SM&P) business of Ultra Maritime for a purchase price of $550 million. The closing of the transaction is subject to certain conditions, including the completion of the regulatory approval processes in the United States (US) and the United Kingdom (UK). The US closing conditions have been met. We are in the final stages of the UK government assessment of the transaction and we are optimistic that the assessment will be positively resolved in the near term. Our current expectation would be to close the transaction either in our second or early in our third fiscal quarter. SM&P’s sole source product offerings will add significant scale to the ESCO Navy business, providing increased content on domestic Navy submarine and surface ship programs and expansion into vital UK and AUKUS navy platforms.

Dividend Payment
The next quarterly cash dividend of $0.08 per share will be paid on April 17, 2025 to stockholders of record on April 2, 2025.

Conference Call
The Company will host a conference call today, February 6, at 4:00 p.m. Central Time, to discuss the Company’s Q1 2025 results. A live audio webcast and an accompanying slide presentation will be available in the Investor Center of ESCO’s website. Participants may also access the webcast using this registration link. For those unable to participate, a webcast replay will be available after the call in the Investor Center of ESCO’s website.

Forward-Looking Statements
Statements in this press release regarding Management’s intentions, expectations and guidance for fiscal 2025, including restructuring and cost reduction actions, sales, orders, revenues, margin, earnings, Adjusted EPS, acquisition related amortization, and any other statements which are not strictly historical, are “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. securities laws.

Investors are cautioned that such statements are only predictions and speak only as of the date of this presentation, and the Company undertakes no duty to update them except as may be required by applicable laws or regulations. The Company’s actual results in the future may differ materially from those projected in the forward-looking statements due to risks and uncertainties that exist in the Company’s operations and business environment including but not limited to those described in Item 1A, “Risk Factors”, of the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2024 and the following: the timing and outcome, if any, of the Company’s strategic alternatives review of VACCO and its Space business; of the Company’s pending acquisition of SM&P; the impacts of climate change and related regulation of greenhouse gases; the impacts of labor disputes, civil disorder, wars, elections, political changes, tariffs and trade disputes, terrorist activities, cyberattacks or natural disasters on the Company’s operations and those of the Company’s customers and suppliers; disruptions in manufacturing or delivery arrangements due to shortages or unavailability of materials or components or supply chain disruptions; inability to access work sites; the timing and content of future contract awards or customer orders; the timely appropriation, allocation and availability of Government funds; the termination for convenience of Government and other customer contracts or orders; weakening of economic conditions in served markets; the success of the Company’s competitors; changes in customer demands or customer insolvencies; competition; intellectual property rights; technical difficulties or data breaches; the availability of acquisitions; delivery delays or defaults by customers; performance issues with key customers, suppliers and subcontractors; material changes in the costs and availability of certain raw materials; material changes in the cost of credit; changes in laws and regulations including but not limited to changes in accounting standards and taxation; changes in interest, inflation and employment rates; costs relating to environmental matters arising from current or former facilities; uncertainty regarding the ultimate resolution of current disputes, claims, litigation or arbitration; and the integration and performance of acquired businesses.

Non-GAAP Financial Measures
The financial measures EBIT, Adjusted EBIT, EBITDA, Adjusted EBITDA, and Adjusted EPS are presented in this press release. The Company defines “EBIT” as earnings before interest and taxes, “EBITDA” as earnings before interest, taxes, depreciation and amortization, “Adjusted EBIT” and “Adjusted EBITDA” as excluding the net impact of the items described in the attached Reconciliation of Non-GAAP Financial Measures, and “Adjusted EPS” as GAAP earnings per share excluding the net impact of the items described and reconciled in the attached Reconciliation of Non-GAAP Financial Measures.

EBIT, Adjusted EBIT, EBITDA, Adjusted EBITDA, and Adjusted EPS are not recognized in accordance with U.S. generally accepted accounting principles (GAAP). However, Management believes EBIT, Adjusted EBIT, EBITDA, and Adjusted EBITDA are useful in assessing the operational profitability of the Company’s business segments because they exclude interest, taxes, depreciation, and amortization, which are generally accounted for across the entire Company on a consolidated basis. EBIT is also one of the measures used by Management in determining resource allocations within the Company as well as incentive compensation. The presentation of EBIT, Adjusted EBIT, EBITDA, Adjusted EBITDA, and Adjusted EPS provides important supplemental information to investors by facilitating comparisons with other companies, many of which use similar non-GAAP financial measures to supplement their GAAP results. The use of non-GAAP financial measures is not intended to replace any measures of performance determined in accordance with GAAP.

About ESCO
ESCO is a global provider of highly engineered products and solutions serving diverse end-markets. It manufactures filtration and fluid control products for the aviation, Navy, space, and process markets worldwide and composite-based products and solutions for Navy, defense, and industrial customers. ESCO is an industry leader in designing and manufacturing RF test and measurement products and systems; and provides diagnostic instruments, software and services to industrial power users and the electric utility and renewable energy industries. Headquartered in St. Louis, Missouri, ESCO and its subsidiaries have offices and manufacturing facilities worldwide. For more information on ESCO and its subsidiaries, visit the Company’s website at www.escotechnologies.com.

ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations (Unaudited)
(Dollars in thousands, except per share amounts)

					Three Months Ended December 31, 2024				Three Months Ended December 31, 2023

Net Sales				$	247,026				218,314
Cost and Expenses:
		Cost of sales			148,642				134,151
		Selling, general and administrative expenses			58,784				53,968
		Amortization of intangible assets			7,993				7,868
		Interest expense			2,257				2,667
		Other (income) expenses, net			(591	)			206
			Total costs and expenses		217,085				198,860

Earnings before income taxes					29,941				19,454
Income tax expense					6,468				4,285

			Net earnings	$	23,473				15,169

			Earnings Per Share (EPS)

			Diluted – GAAP	$	0.91				0.59

			Diluted – As Adjusted Basis	$	1.07		(1	)	0.76	(2	)

			Diluted average common shares O/S:		25,834				25,846

(1	)	Q1 2025 Adjusted EPS excludes $0.16 per share of after-tax charges consisting primarily of $0.01 of restructuring charges within the Test segment and acquisition related costs at Corporate and $0.15 of acquisition related amortization.

(2	)	Q1 2024 Adjusted EPS excludes $0.17 per share of after-tax charges consisting primarily of $0.03 of MPE acquisition inventory step-up and backlog charges and acquisition related costs and $0.14 of acquisition related amortization.

ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Condensed Business Segment Information (Unaudited)
(Dollars in thousands)

				GAAP				As Adjusted
				Q1 2025		Q1 2024		Q1 2025		Q1 2024
Net Sales
	Aerospace & Defense		$	114,301		94,733		114,301		94,733
	USG			86,660		82,984		86,660		82,984
	Test			46,065		40,597		46,065		40,597
		Totals	$	247,026		218,314		247,026		218,314

EBIT
	Aerospace & Defense		$	21,596		16,663		21,622		16,663
	USG			20,489		17,625		20,489		17,745
	Test			4,422		1,779		4,887		2,052
	Corporate			(14,309	)	(13,946	)	(9,310	)	(8,600	)
		Consolidated EBIT		32,198		22,121		37,688		27,860
		Less: Interest expense		(2,257	)	(2,667	)	(2,257	)	(2,667	)
		Less: Income tax expense		(6,468	)	(4,285	)	(7,730	)	(5,605	)
		Net earnings	$	23,473		15,169		27,701		19,588

Note 1: Adjusted net earnings of $27.7 million in Q1 2025 exclude $4.2 million (or $0.16 per share) of after-tax charges consisting primarily of restructuring charges within the Test segment and acquisition related costs at Corporate, and acquisition related amortization.

Note 2: Adjusted net earnings of $19.6 million in Q1 2024 exclude $4.4 million (or $0.17 per share) of after-tax charges consisting primarily of MPE acquisition inventory step-up and backlog charges and acquisition related costs, and acquisition related amortization.

EBITDA Reconciliation to Net earnings:								Adjusted		Adjusted
				Q1 2025		Q1 2024		Q1 2025		Q1 2024
Consolidated EBITDA			$	46,005		35,573		46,498		36,408
Less: Depr & Amort				(13,807	)	(13,452	)	(8,810	)	(8,548	)
Consolidated EBIT				32,198		22,121		37,688		27,860
Less: Interest expense				(2,257	)	(2,667	)	(2,257	)	(2,667	)
Less: Income tax expense				(6,468	)	(4,285	)	(7,730	)	(5,605	)
Net earnings			$	23,473		15,169		27,701		19,588

ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets (Unaudited)
(Dollars in thousands)

				December 31, 2024	September 30, 2024

Assets
	Cash and cash equivalents		$	71,284	65,963
	Accounts receivable, net			202,661	240,680
	Contract assets			131,404	130,534
	Inventories			219,383	209,164
	Other current assets			20,779	22,308
		Total current assets		645,511	668,649
	Property, plant and equipment, net			168,468	170,596
	Intangible assets, net			396,302	407,602
	Goodwill			532,312	539,899
	Operating lease assets			38,710	37,744
	Other assets			13,761	14,130
			$	1,795,064	1,838,620

Liabilities and Shareholders’ Equity
	Current maturities of long-term debt		$	20,000	20,000
	Accounts payable			75,881	98,371
	Contract liabilities			129,737	124,845
	Other current liabilities			90,491	106,638
		Total current liabilities		316,109	349,854
	Deferred tax liabilities			75,520	75,333
	Non-current operating lease liabilities			36,400	34,810
	Other liabilities			38,102	39,273
	Long-term debt			92,000	102,000
	Shareholders’ equity			1,236,933	1,237,350
			$	1,795,064	1,838,620

ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(Dollars in thousands)

		Three Months Ended December 31, 2024		Three Months Ended December 31, 2023
Cash flows from operating activities:
Net earnings	$	23,473		15,169
Adjustments to reconcile net earnings to net cash
provided by operating activities:
Depreciation and amortization		13,807		13,452
Stock compensation expense		2,524		2,180
Changes in assets and liabilities		(7,151	)	(22,539	)
Effect of deferred taxes		1,521		484
Net cash provided by operating activities		34,174		8,746

Cash flows from investing activities:
Acquisition of business, net of cash acquired		–		(56,179	)
Capital expenditures		(5,208	)	(7,848	)
Additions to capitalized software		(2,587	)	(2,942	)
Net cash used by investing activities		(7,795	)	(66,969	)

Cash flows from financing activities:
Proceeds from long-term debt		42,000		99,000
Principal payments on long-term debt and short-term borrowings		(52,000	)	(29,000	)
Dividends paid		(2,064	)	(2,064	)
Purchases of common stock into treasury		–		–
Other		(6,031	)	(1,432	)
Net cash (used) provided by financing activities		(18,095	)	66,504

Effect of exchange rate changes on cash and cash equivalents		(2,963	)	1,249

Net increase in cash and cash equivalents		5,321		9,530
Cash and cash equivalents, beginning of period		65,963		41,866
Cash and cash equivalents, end of period	$	71,284		51,396

ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Other Selected Financial Data (Unaudited)
(Dollars in thousands)

Backlog And Entered Orders – Q1 2025			A&D		USG		Test		Total
	Beginning Backlog – 10/1/24	$	600,382		119,943		158,644		878,969
	Entered Orders		120,606		89,574		64,825		275,005
	Sales		(114,301	)	(86,660	)	(46,065	)	(247,026	)
	Ending Backlog – 12/31/24	$	606,687		122,857		177,404		906,948

ESCO TECHNOLOGIES INC. AND SUBSIDIARIES
Reconciliation of Non-GAAP Financial Measures (Unaudited)

EPS – Adjusted Basis Reconciliation – Q1 2025
	EPS – GAAP Basis – Q1 2025	$	0.91
	Adjustments (defined below)		0.16
	EPS – As Adjusted Basis – Q1 2025	$	1.07

	Adjustments exclude $0.16 per share consisting primarily of $0.01 of restructuring
	charges within the Test segment and acquisition related costs at Corporate and
	$0.15 of acquisition related amortization.
	The $0.16 of EPS adjustments per share consists of $5,490K of pre-tax charges
	offset by $1,262K of tax benefit for net impact of $4,228K.

EPS – Adjusted Basis Reconciliation – Q1 2024
	EPS – GAAP Basis – Q1 2024	$	0.59
	Adjustments (defined below)		0.17
	EPS – As Adjusted Basis – Q1 2024	$	0.76

	Adjustments exclude $0.17 per share consisting primarily of $0.03 of MPE
	acquisition inventory step-up and backlog charges and acquisition related costs and
	$0.14 of acquisition related amortization.
	The $0.17 of EPS adjustments per share consists of $5,739K of pre-tax charges
	offset by $1,320K of tax benefit for net impact of $4,419K.

EPS – Adjusted Basis Reconciliation – Q2 2025 Guidance			Low	High
	EPS – GAAP Basis – Q2 2025	$	1.05	1.15
	Adjustments (defined below)		0.15	0.15
	EPS – As Adjusted Basis – Q2 2025	$	1.20	1.30

	Adjustments exclude an estimated $0.15 of acquisition related amortization.
	The estimated $0.15 of EPS adjustment per share consists of $5.0 million of pre-tax charges
	offset by $1.15 million of tax benefit for net impact of $3.85 million.

EPS – Adjusted Basis Reconciliation – FY 2025 Guidance			Low	High
	EPS – GAAP Basis – FY 2025	$	4.94	5.14
	Adjustments (defined below)		0.61	0.61
	EPS – As Adjusted Basis – FY 2025	$	5.55	5.75

	Adjustments exclude $0.61 per share consisting primarily of $0.01 of restructuring charges within
	the Test segment and acquisition related costs at Corporate and an estimated $0.60 of acquisition
	related amortization. The estimated $0.61 of EPS adjustments per share consists of $20.5
	million of pre-tax charges offset by $4.7 million of tax benefits for net impact of $15.8 million.

SOURCE ESCO Technologies Inc.
Kate Lowrey, Vice President of Investor Relations, (314) 213-7277

The MIL Network –

February 7, 2025

MIL-OSI: Northeast Bank Reports Second Quarter Results and Declares Dividend

Source: GlobeNewswire (MIL-OSI)

PORTLAND, Maine, Feb. 06, 2025 (GLOBE NEWSWIRE) — Northeast Bank (the “Bank”) (NASDAQ: NBN), a Maine-based full-service bank, today reported net income of $22.4 million, or $2.74 per diluted common share, for the quarter ended December 31, 2024, compared to net income of $14.1 million, or $1.85 per diluted common share, for the quarter ended December 31, 2023. Net income for the six months ended December 31, 2024 was $39.5 million, or $4.85 per diluted common share, compared to $29.2 million, or $3.86 per diluted common share, for the six months ended December 31, 2023.

The Board of Directors declared a cash dividend of $0.01 per share, payable on March 4, 2025, to shareholders of record as of February 18, 2025.

Discussing these results, Rick Wayne, Chief Executive Officer, said, “Our National Lending Division generated $260.4 million in originated and purchased volume for the quarter, including record originations of $246.4 million. Our small balance SBA 7(a) program with Newity LLC as our loan service provider has continued to grow. For the quarter, we originated $100.3 million, compared to $82.4 million for the quarter ended September 30, 2024 and $13.6 million for the quarter ended December 31, 2023. During the current quarter we sold $64.5 million of the guaranteed portion of our SBA loans, generating a gain on sale of $5.6 million. Additionally, we approved and initiated an additional at-the-market (“ATM”) offering of up to $75.0 million of our voting common stock, which provides the Bank with the ability to raise capital if and as needed. We are reporting earnings of $2.74 per diluted common share, a return on average equity of 21.1%, and a return on average assets of 2.2%.”

As of December 31, 2024, total assets were $4.08 billion, an increase of $950.9 million, or 30.4%, from total assets of $3.13 billion as of June 30, 2024.

1. The following table highlights the changes in the loan portfolio, including loans held for sale, for the six months ended December 31, 2024:

	Loan Portfolio Changes
	December 31, 2024 Balance		June 30, 2024 Balance			Change ($)		Change (%)
	(Dollars in thousands)
National Lending Purchased	$	2,392,417	$	1,708,551	$	683,866		40.03	%
National Lending Originated		1,109,192		981,497		127,695		13.01	%
SBA National		103,554		48,405		55,149		113.92	%
Community Banking		20,857		22,704		(1,847	)	(8.14	%)
Total	$	3,626,020	$	2,761,157	$	864,863		31.32	%

Loans generated by the Bank’s National Lending Division for the quarter ended December 31, 2024 totaled $260.5 million, which consisted of $14.0 million of purchased loans at an average price of 94.8% of unpaid principal balance, and $246.4 million of originated loans.

An overview of the Bank’s National Lending Division portfolio follows:

		National Lending Portfolio
		Three Months Ended December 31,
	2024								2023
	Purchased				Originated		Total		Purchased		Originated		Total
	(Dollars in thousands)
Loans purchased or originated during the period:
Unpaid principal balance	$		14,815		$	246,417	$	261,232	$	208,045	$	63,485	$	271,530
Initial net investment basis (1)			14,039			246,417		260,456		186,131		63,485		249,616

Loan returns during the period:
Yield			8.84%			9.06%		8.91%		9.19%		9.81%		9.43%
Total Return on Purchased Loans (2)			8.86%			N/A		8.86%		9.21%		N/A		9.21%

	Six Months Ended December 31,
	2024								2023
	Purchased				Originated		Total		Purchased		Originated		Total
	(Dollars in thousands)
Loans purchased or originated during the period:
Unpaid principal balance	$		822,549		$	373,309	$	1,195,858	$	271,741	$	131,528	$	403,269
Initial net investment basis (1)			746,932			373,309		1,120,241		238,477		131,528		370,005

Loan returns during the period:
Yield			8.84	%		9.18%		8.95%		9.10%		9.92%		9.41%
Total Return on Purchased Loans (2)			8.85%			N/A		8.85%		9.13%		N/A		9.13%

Total loans as of period end:
Unpaid principal balance	$		2,598,354		$	1,109,192	$	3,707,546	$	1,831,183	$	910,213	$	2,741,396
Net investment basis			2,392,417			1,109,192		3,501,609		1,646,756		910,213		2,556,969

^{(1) Initial net investment basis on purchased loans is the initial amortized cost basis net of initial allowance for credit losses (credit mark).}
^{(2) The total return on purchased loans represents scheduled accretion, accelerated accretion, gains (losses) on real estate owned, release of allowance for credit losses on purchased loans, and other noninterest income recorded during the period divided by the average invested balance on an annualized basis. The total return on purchased loans does not include the effect of purchased loan charge-offs or recoveries during the period. Total return on purchased loans is considered a non-GAAP financial measure. See reconciliation in below table entitled “Total Return on Purchased Loans.”}

2. Deposits increased by $811.9 million, or 34.7%, from June 30, 2024. The increase was primarily attributable to increases in time deposits of $773.5 million, or 59.2%. The significant drivers in the change in time deposits were the increase in brokered time deposits, which increased by $660.5 million, and Community Banking Division time deposits, which increased by $90.5 million compared to June 30, 2024.

3. Federal Home Loan Bank (“FHLB”) advances increased by $62.6 million, or 18.1%, from June 30, 2024. The increase was attributable to one new short-term borrowing, partially offset by net paydowns on amortizing advances.

4. Shareholders’ equity increased by $67.5 million, or 17.9%, from June 30, 2024, primarily due to net income of $39.5 million and $28.1 million of net proceeds on shares issued in connection with the Bank’s ATM program.

Net income increased by $8.4 million to $22.4 million for the quarter ended December 31, 2024, compared to net income of $14.1 million for the quarter ended December 31, 2023.

1. Net interest and dividend income before provision for credit losses increased by $11.5 million to $48.5 million for the quarter ended December 31, 2024, compared to $37.0 million for the quarter ended December 31, 2023. The increase was primarily due to the following:

An increase in interest income earned on loans of $20.2 million, primarily due to higher average balances in the National Lending Division purchased and originated and Small Business Administration (“SBA”) portfolios, partially offset by lower rates earned across the portfolio;
An increase in interest income earned on short-term investments of $925 thousand, due to higher average balances, partially offset by lower rates earned; and
A decrease in FHLB borrowings interest expense of $2.0 million, primarily due to lower average balances; partially offset by,
An increase in deposit interest expense of $11.6 million, primarily due to higher average balances, partially offset by lower rates on interest-bearing deposits.

The following table summarizes interest income and related yields recognized on the loan portfolios:

	Interest Income and Yield on Loans
	Three Months Ended December 31,
	2024						2023
	Average		Interest				Average		Interest
	Balance (1)		Income		Yield		Balance (1)		Income		Yield
	(Dollars in thousands)
Community Banking	$	21,481	$	369	6.82	%	$	25,559	$	419	6.51	%
SBA National		93,831		2,751	11.63	%		28,331		888	12.47	%
National Lending:
Originated		1,041,301		23,769	9.06	%		939,383		23,155	9.81	%
Purchased		2,407,132		53,655	8.84	%		1,551,038		35,849	9.19	%
Total National Lending		3,448,433		77,424	8.91	%		2,490,421		59,004	9.43	%
Total	$	3,563,745	$	80,544	8.97	%	$	2,544,311	$	60,311	9.43	%
	Six Months Ended December 31,
	2024						2023
	Average		Interest				Average		Interest
	Balance (1)		Income		Yield		Balance (1)		Income		Yield
	(Dollars in thousands)
Community Banking	$	21,945	$	738	6.67	%	$	26,355	$	857	6.47	%
SBA National		76,788		5,170	13.36	%		27,294		1,674	12.20	%
National Lending:
Originated		1,019,347		47,176	9.18	%		950,006		47,375	9.92	%
Purchased		2,082,969		92,797	8.84	%		1,520,215		69,519	9.10	%
Total National Lending		3,102,316		139,973	8.95	%		2,470,221		116,894	9.41	%
Total	$	3,201,049	$	145,881	9.04	%	$	2,523,870	$	119,425	9.41	%

^{(1) Includes loans held for sale.}

The components of total income on purchased loans are set forth in the table below entitled “Total Return on Purchased Loans.” When compared to the quarter ended December 31, 2023, transactional income increased by $541 thousand for the quarter ended December 31, 2024, and regularly scheduled interest and accretion increased by $17.3 million primarily due to the increase in average balances. The total return on purchased loans for the quarter ended December 31, 2024 was 8.9%, a decrease from 9.2% for the quarter ended December 31, 2023. The following table details the total return on purchased loans:

	Total Return on Purchased Loans
	Three Months Ended December 31,
	2024				2023
	Income		Return (1)		Income		Return (1)
	(Dollars in thousands)
Regularly scheduled interest and accretion	$	50,747	8.36	%	$	33,430	8.57		%
Transactional income:
Release of allowance for credit losses on purchased loans		97	0.02	%		46	0.02		%
Accelerated accretion and loan fees		2,908	0.48	%		2,419	0.62		%
Total transactional income		3,005	0.50	%		2,465	0.64		%
Total	$	53,752	8.86	%	$	35,895	9.21		%

	Six Months Ended December 31,
	2024				2023
	Income		Return (1)		Income			Return (1)
	(Dollars in thousands)
Regularly scheduled interest and accretion	$	87,906	8.37	%	$	64,460		8.44	%
Transactional income:
Release of allowance for credit losses on purchased loans		161	0.01	%		226		0.03	%
Accelerated accretion and loan fees		4,891	0.47	%		5,059		0.66	%
Total transactional income		5,052	0.48	%		5,285		0.69	%
Total	$	92,958	8.85	%	$	69,745		9.13	%

^{(1) The total return on purchased loans represents scheduled accretion, accelerated accretion, and gains (losses) on real estate owned, and release of allowance for credit losses on purchased loans recorded during the period divided by the average invested balance on an annualized basis. The total return does not include the effect of purchased loan charge-offs or recoveries in the quarter. Total return is considered a non-GAAP financial measure.}

2. Provision for credit losses increased by $1.5 million to $1.9 million for the quarter ended December 31, 2024, compared to $436 thousand in the quarter ended December 31, 2023. The increase was primarily related to loan growth and increases in specific reserves on certain loans.

3. Noninterest income increased by $4.5 million for the quarter ended December 31, 2024, compared to the quarter ended December 31, 2023, primarily due to an increase in gain on sale of SBA loans of $5.0 million, due to the sale of $64.5 million in SBA loans during the quarter ended December 31, 2024 as compared to the sale of $11.5 million during the quarter ended December 31, 2023.

4. Noninterest expense increased by $3.4 million for the quarter ended December 31, 2024 compared to the quarter ended December 31, 2023, primarily due to the following:

An increase in salaries and employee benefits expense of $1.4 million, primarily due to increases in regular and stock compensation expense;
An increase in loan expense of $1.1 million primarily related to increased expenses in connection with the origination of SBA 7(a) loans; and
An increase in FDIC insurance expense of $669 thousand, due to the growth of the Bank’s asset size and an increased assessment rate.

5. Income tax expense increased by $2.7 million to $11.0 million, or an effective tax rate of 32.9%, for the quarter ended December 31, 2024, compared to $8.3 million, or an effective tax rate of 37.1%, for the quarter ended December 31, 2023. The decrease in effective tax rate is primarily due to a write-down of the Bank’s deferred tax asset of $957 thousand in the quarter ended December 31, 2023 as a result of a change in Massachusetts income tax law.

As of December 31, 2024, nonperforming assets totaled $31.3 million, or 0.77% of total assets, compared to $28.3 million, or 0.90% of total assets, as of June 30, 2024.

As of December 31, 2024, past due loans totaled $30.5 million, or 0.85% of total loans, compared to past due loans totaling $26.3 million, or 0.95% of total loans, as of June 30, 2024.

As of December 31, 2024, the Bank’s Tier 1 leverage capital ratio was 11.2%, compared to 12.3% at June 30, 2024, and the Total risk-based capital ratio was 13.9% at December 31, 2024, compared to 14.8% at June 30, 2024. Capital ratios decreased primarily due to the increase in risk-weighted assets and average assets from significant loan growth during the six months ended December 31, 2024, partially offset by increased retained earnings and additional capital raised under the Bank’s ATM program.

Investor Call Information
Rick Wayne, Chief Executive Officer, Richard Cohen, Chief Financial Officer, and Pat Dignan, Chief Operating Officer and Chief Credit Officer of Northeast Bank, will host a conference call to discuss second quarter earnings and business outlook at 10:00 a.m. Eastern Time on Friday, February 7^th. To access the conference call by phone, please go to this link (Phone Registration), and you will be provided with dial in details. The call will be available via live webcast, which can be viewed by accessing the Bank’s website at www.northeastbank.com and clicking on the About Us – Investor Relations section. To listen to the webcast, attendees are encouraged to visit the website at least fifteen minutes early to register, download and install any necessary audio software. Please note there will also be a slide presentation that will accompany the webcast. For those who cannot listen to the live broadcast, a replay will be available online for one year at www.northeastbank.com.

About Northeast Bank
Northeast Bank (NASDAQ: NBN) is a full-service bank headquartered in Portland, Maine. We offer personal and business banking services to the Maine market via seven branches. Our National Lending Division purchases and originates commercial loans on a nationwide basis. ableBanking, a division of Northeast Bank, offers online savings products to consumers nationwide. Information regarding Northeast Bank can be found at www.northeastbank.com.

Non-GAAP Financial Measures
In addition to results presented in accordance with generally accepted accounting principles (“GAAP”), this press release contains certain non-GAAP financial measures, including tangible common shareholders’ equity, tangible book value per share, total return on purchased loans, and efficiency ratio. The Bank’s management believes that the supplemental non-GAAP information is utilized by regulators and market analysts to evaluate a company’s financial condition and therefore, such information is useful to investors. These disclosures should not be viewed as a substitute for financial results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies’ non-GAAP financial measures having the same or similar names.

Forward-Looking Statements
Statements in this press release that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. We may also make forward-looking statements in other documents we file with the Federal Deposit Insurance Corporation (the “FDIC”), in our annual reports to our shareholders, in press releases and other written materials, and in oral statements made by our officers, directors or employees. You can identify forward-looking statements by the use of the words “believe,” “expect,” “anticipate,” “intend,” “estimate,” “assume,” “outlook,” “will,” “should,” and other expressions that predict or indicate future events and trends and which do not relate to historical matters. Although the Bank believes that these forward-looking statements are based on reasonable estimates and assumptions, they are not guarantees of future performance and are subject to known and unknown risks, uncertainties, contingencies, and other factors. You should not place undue reliance on our forward-looking statements. You should exercise caution in interpreting and relying on forward-looking statements because they are subject to significant risks, uncertainties and other factors which are, in some cases, beyond the Bank’s control. The Bank’s actual results could differ materially from those expressed or implied by such the forward-looking statements as a result of, among other factors, changes in interest rates and real estate values; changes in employment levels, general business and economic conditions on a national basis and in the local markets in which the Bank operates; changes in customer behavior due to changing business and economic conditions (including inflation and concerns about liquidity) or legislative or regulatory initiatives; the possibility that future credits losses are higher than currently expected due to changes in economic assumptions, customer behavior or adverse economic developments; turbulence in the capital and debt markets; competitive pressures from other financial institutions; changes in loan defaults and charge-off rates; changes in the value of securities and other assets, adequacy of credit loss reserves, or deposit levels necessitating increased borrowing to fund loans and investments; changes in legislation and regulation under the new U.S. presidential administration; operational risks including, but not limited to, cybersecurity, fraud, natural disasters, climate change and future pandemics; the risk that the Bank may not be successful in the implementation of its business strategy; the risk that intangibles recorded in the Bank’s financial statements will become impaired; changes in assumptions used in making such forward-looking statements; and the other risks and uncertainties detailed in the Bank’s Annual Report on Form 10-K, as amended by Amendment No. 1 to the Annual Report on Form 10-K/A as updated in the Bank’s Quarterly Reports on Form 10-Q and other filings submitted to the FDIC. These statements speak only as of the date of this release and the Bank does not undertake any obligation to update or revise any of these forward-looking statements to reflect events or circumstances occurring after the date of this communication or to reflect the occurrence of unanticipated events.

NBN-F


NORTHEAST BANK
BALANCE SHEETS
(Unaudited)
(Dollars in thousands, except share and per share data)
	December 31, 2024		June 30, 2024
Assets
Cash and due from banks	$	2,538	$	2,711
Short-term investments		362,332		239,447
Total cash and cash equivalents		364,870		242,158


Available-for-sale debt securities, at fair value		27,616		48,978
Equity securities, at fair value		7,171		7,013
Total investment securities		34,787		55,991

SBA loans held for sale		35,234		14,506

Loans:
Commercial real estate		2,703,938		2,028,280
Commercial and industrial		778,189		618,846
Residential real estate		108,427		99,234
Consumer		232		291
Total loans		3,590,786		2,746,651
Less: Allowance for credit losses		44,773		26,709
Loans, net		3,546,013		2,719,942


Premises and equipment, net		25,739		27,144
Real estate owned and other possessed collateral, net		1,200		–
Federal Home Loan Bank stock, at cost		17,798		15,751
Loan servicing rights, net		841		984
Bank-owned life insurance		19,078		18,830
Accrued interest receivable		16,939		15,163
Other assets		20,555		21,734
Total assets	$	4,083,054	$	3,132,203

Liabilities and Shareholders’ Equity
Deposits:
Demand	$	159,002	$	146,727
Savings and interest checking		782,570		732,029
Money market		130,063		154,504
Time		2,079,703		1,306,203
Total deposits		3,151,338		2,339,463

Federal Home Loan Bank and other advances		407,824		345,190
Lease liability		19,461		20,252
Other liabilities		60,330		50,664
Total liabilities		3,638,953		2,755,569

Commitments and contingencies		–		–

Shareholders’ equity
Preferred stock, $1.00 par value, 1,000,000 shares authorized; no shares
issued and outstanding at December 31 and June 30, 2024		–		–
Voting common stock, $1.00 par value, 25,000,000 shares authorized;
8,492,856 and 8,127,690 shares issued and outstanding at
December 31 and June 30, 2024, respectively		8,493		8,128
Non-voting common stock, $1.00 par value, 3,000,000 shares authorized;
No shares issued and outstanding at December 31 and June 30, 2024		–		–
Additional paid-in capital		92,292		64,762
Retained earnings		343,302		303,927
Accumulated other comprehensive income (loss)		14		(183	)
Total shareholders’ equity		444,101		376,634
Total liabilities and shareholders’ equity	$	4,083,054	$	3,132,203


NORTHEAST BANK
STATEMENTS OF INCOME
(Unaudited)
(Dollars in thousands, except share and per share data)
		Three Months Ended December 31,							Six Months Ended December 31,
		2024				2023			2024		2023
	Interest and dividend income:
	Interest and fees on loans		$	80,544		$	60,311		$	145,881	$	119,425
	Interest on available-for-sale securities			436			560			1,031		1,043
	Other interest and dividend income			4,186			3,261			8,108		6,361
	Total interest and dividend income			85,166			64,132			155,020		126,829

	Interest expense:
	Deposits			32,777			21,175			59,367		40,433
	Federal Home Loan Bank advances			3,666			5,701			7,696		11,847
	Obligation under capital lease agreements			233			256			467		425
	Total interest expense			36,676			27,132			67,530		52,705

	Net interest and dividend income before provision for credit losses			48,490			37,000			87,490		74,124
	Provision for credit losses			1,944			436			2,366		625
	Net interest and dividend income after provision for credit losses			46,546			36,564			85,124		73,499

	Noninterest income:
	Fees for other services to customers			391			492			834		899
	Gain on sales of SBA loans			5,570			570			8,901		822
	Net unrealized gain (loss) on equity securities			(163	)		230			27		72
	Loss on real estate owned, other repossessed collateral and premises and equipment, net			–			(9	)		–		(9	)
	Bank-owned life insurance income			125			116			248		231
	Correspondent fee income			23			52			54		143
	Other noninterest income			3			15			5		87
	Total noninterest income			5,949			1,466			10,069		2,245

	Noninterest expense:
	Salaries and employee benefits			11,287			9,905			22,470		19,625
	Occupancy and equipment expense			1,103			1,101			2,182		2,206
	Professional fees			562			499			1,315		1,281
	Data processing fees			1,622			1,347			3,109		2,447
	Marketing expense			94			221			230		482
	Loan acquisition and collection expense			2,063			939			3,355		1,589
	FDIC insurance expense			956			287			1,288		644
	Other noninterest expense			1,379			1,370			2,802		2,784
	Total noninterest expense			19,066			15,669			36,751		31,058

	Income before income tax expense			33,429			22,361			58,442		44,686
	Income tax expense			10,989			8,307			18,896		15,460
	Net income		$	22,440		$	14,054		$	39,546	$	29,226

	Weighted-average shares outstanding:
	Basic			8,044,345			7,505,109			7,965,486		7,492,310
	Diluted			8,197,568			7,590,913			8,153,368		7,572,450
	Earnings per common share:
	Basic		$	2.79		$	1.87		$	4.96	$	3.90
	Diluted			2.74			1.85			4.85		3.86
	Cash dividends declared per common share		$	0.01		$	0.01		$	0.02	$	0.02


NORTHEAST BANK
AVERAGE BALANCE SHEETS AND ANNUALIZED YIELDS
(Unaudited)
(Dollars in thousands)
	Three Months Ended December 31,
	2024						2023
			Interest		Average				Interest		Average
	Average		Income/		Yield/		Average		Income/		Yield/
	Balance		Expense		Rate		Balance		Expense		Rate
Assets:
Interest-earning assets:
Investment securities	$	40,004	$	436	4.32	%	$	59,797	$	560	3.73	%
Loans (1) (2) (3)		3,563,745		80,544	8.97	%		2,544,311		60,311	9.43	%
Federal Home Loan Bank stock		15,458		346	8.88	%		21,222		468	8.77	%
Short-term investments (4)		325,118		3,840	4.69	%		206,090		2,793	5.39	%
Total interest-earning assets		3,944,325		85,166	8.57	%		2,831,420		64,132	9.01	%
Cash and due from banks		2,216						2,508
Other non-interest earning assets		30,982						69,245
Total assets	$	3,977,523					$	2,903,173

Liabilities & Shareholders’ Equity:
Interest-bearing liabilities:
NOW accounts	$	581,969	$	5,932	4.04	%	$	511,217	$	5,636	4.39	%
Money market accounts		128,787		953	2.94	%		229,154		2,009	3.49	%
Savings accounts		187,701		1,653	3.49	%		122,643		917	2.97	%
Time deposits		2,080,911		24,239	4.62	%		1,022,767		12,613	4.91	%
Total interest-bearing deposits		2,979,368		32,777	4.36	%		1,885,781		21,175	4.47	%
Federal Home Loan Bank advances		336,762		3,666	4.32	%		481,824		5,701	4.71	%
Lease liability		19,599		233	4.72	%		21,361		256	4.77	%
Total interest-bearing liabilities		3,335,729		36,676	4.36	%		2,388,966		27,132	4.52	%

Non-interest bearing liabilities:
Demand deposits and escrow accounts		190,135						167,358
Other liabilities		30,501						24,616
Total liabilities		3,556,365						2,580,940
Shareholders’ equity		421,158						322,233
Total liabilities and shareholders’ equity	$	3,977,523					$	2,903,173

Net interest income			$	48,490					$	37,000

Interest rate spread					4.21	%					4.49	%
Net interest margin (5)					4.88	%					5.20	%

Cost of funds (6)					4.13	%					4.22	%

(1) Interest income and yield are stated on a fully tax-equivalent basis using the statutory tax rate. (2) Includes loans held for sale.
(3) Nonaccrual loans are included in the computation of average, but unpaid interest has not been included for purposes of determining interest income.
(4) Short-term investments include FHLB overnight deposits and other interest-bearing deposits. (5) Net interest margin is calculated as net interest income divided by total interest-earning assets. (6) Cost of funds is calculated as total interest expense divided by total interest-bearing liabilities plus demand deposits and escrow accounts.

NORTHEAST BANK
AVERAGE BALANCE SHEETS AND ANNUALIZED YIELDS
(Unaudited)
(Dollars in thousands)
	Six Months Ended December 31,
	2024						2023
			Interest		Average				Interest		Average
	Average		Income/		Yield/		Average		Income/		Yield/
	Balance		Expense		Rate		Balance		Expense		Rate
Assets:
Interest-earning assets:
Investment securities	$	47,708	$	1,031	4.29	%	$	59,986	$	1,043	3.46	%
Loans (1) (2) (3)		3,201,049		145,881	9.04	%		2,523,870		119,425	9.41	%
Federal Home Loan Bank stock		15,961		676	8.40	%		21,790		881	8.04	%
Short-term investments (4)		285,330		7,432	5.17	%		203,946		5,480	5.34	%
Total interest-earning assets		3,550,048		155,020	8.66	%		2,809,592		126,829	8.98	%
Cash and due from banks		2,164						2,500
Other non-interest earning assets		62,527						62,753
Total assets	$	3,614,739					$	2,874,845

Liabilities & Shareholders’ Equity:
Interest-bearing liabilities:
NOW accounts	$	572,849	$	12,312	4.26	%	$	499,331	$	10,781	4.29	%
Money market accounts		138,738		2,219	3.17	%		243,725		4,142	3.38	%
Savings accounts		183,141		3,210	3.48	%		106,820		1,477	2.75	%
Time deposits		1,735,372		41,626	4.76	%		999,993		24,033	4.78	%
Total interest-bearing deposits		2,630,100		59,367	4.48	%		1,849,869		40,433	4.35	%
Federal Home Loan Bank advances		349,678		7,696	4.37	%		496,169		11,847	4.75	%
Lease liability		19,808		467	4.68	%		21,568		425	3.92	%
Total interest-bearing liabilities		2,999,586		67,530	4.47	%		2,367,606		52,705	4.43	%

Non-interest bearing liabilities:
Demand deposits and escrow accounts		182,648						168,348
Other liabilities		28,337						24,842
Total liabilities		3,210,571						2,560,796
Shareholders’ equity		404,168						314,049
Total liabilities and shareholders’ equity	$	3,614,739					$	2,874,845

Net interest income			$	87,490					$	74,124

Interest rate spread					4.19	%					4.55	%
Net interest margin (5)					4.89	%					5.25	%

Cost of funds (6)					4.21	%					4.04	%

(1) Interest income and yield are stated on a fully tax-equivalent basis using the statutory tax rate.
(2) Includes loans held for sale. (3) Nonaccrual loans are included in the computation of average, but unpaid interest has not been included for purposes of determining interest income.
(4) Short-term investments include FHLB overnight deposits and other interest-bearing deposits. (5) Net interest margin is calculated as net interest income divided by total interest-earning assets. (6) Cost of funds is calculated as total interest expense divided by total interest-bearing liabilities plus demand deposits and escrow accounts.

NORTHEAST BANK
SELECTED FINANCIAL HIGHLIGHTS AND OTHER DATA
(Unaudited)
(Dollars in thousands, except share and per share data)
	Three Months Ended
	December 31, 2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023
Net interest income	$	48,490	$	39,000	$	37,935	$	36,512	$	37,000
Provision for credit losses		1,944		422		547		596		436
Noninterest income		5,949		4,119		2,092		1,542		1,466
Noninterest expense		19,066		17,685		17,079		16,429		15,669
Net income		22,440		17,106		15,140		13,865		14,054

Weighted-average common shares outstanding:
Basic		8,044,345		7,886,148		7,765,868		7,509,320		7,505,109
Diluted		8,197,568		8,108,688		7,910,692		7,595,124		7,590,913
Earnings per common share:
Basic	$	2.79	$	2.17	$	1.95	$	1.85	$	1.87
Diluted		2.74		2.11		1.91		1.83		1.85

Dividends declared per common share	$	0.01	$	0.01	$	0.01	$	0.01	$	0.01

Return on average assets		2.24%		2.09%		1.99%		1.87%		1.93%
Return on average equity		21.14%		17.53%		16.56%		16.45%		17.35%
Net interest rate spread (1)		4.21%		4.18%		4.41%		4.27%		4.49%
Net interest margin (2)		4.88%		4.90%		5.13%		5.01%		5.20%
Efficiency ratio (non-GAAP) (3)		35.02%		41.01%		42.67%		43.17%		40.73%
Noninterest expense to average total assets		1.90%		2.16%		2.24%		2.21%		2.15%
Average interest-earning assets to average interest-bearing liabilities		118.24%		118.48%		118.78%		119.28%		118.52%

	As of:
	December 31, 2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023
Nonperforming loans:
Originated portfolio:
Residential real estate	$	2,446	$	3,976	$	2,502	$	2,573	$	2,582
Commercial real estate		3,662		4,682		1,407		2,075		2,075
Commercial and industrial		6,696		6,684		6,520		6,928		6,950
Consumer		5		–		–		–		–
Total originated portfolio		12,809		15,342		10,429		11,576		11,607
Total purchased portfolio		17,257		21,830		17,832		16,370		19,165
Total nonperforming loans		30,066		37,172		28,261		27,946		30,772
Real estate owned and other repossessed collateral, net		1,200		–		–		–		–
Total nonperforming assets	$	31,266	$	37,172	$	28,261	$	27,946	$	30,772

Past due loans to total loans		0.85%		0.89%		0.95%		1.13%		1.22%
Nonperforming loans to total loans		0.84%		1.06%		1.02%		1.05%		1.18%
Nonperforming assets to total assets		0.77%		0.94%		0.90%		0.93%		1.04%
Allowance for credit losses to total loans		1.25%		1.25%		0.97%		0.98%		1.06%
Allowance for credit losses to nonperforming loans		148.92%		117.40%		94.51%		92.83%		89.67%
Net charge-offs (recoveries)	$	869	$	1,604	$	1,347	$	2,225	$	995
Commercial real estate loans to total capital (4)		542.12%		604.38%		482.13%		509.08%		544.34%
Net loans to deposits		112.52%		110.70%		116.88%		118.15%		121.31%
Purchased loans to total loans		66.63%		69.11%		61.88%		60.99%		63.07%
Equity to total assets		10.88%		9.96%		12.02%		11.73%		11.03%
Common equity tier 1 capital ratio		12.66%		11.45%		13.84%		13.24%		12.63%
Total risk-based capital ratio		13.91%		12.70%		14.82%		14.22%		13.71%
Tier 1 leverage capital ratio		11.16%		12.06%		12.30%		11.79%		11.28%

Total shareholders’ equity	$	444,101	$	392,557	$	376,634	$	351,913	$	327,540
Less: Preferred stock		–		–		–		–		–
Common shareholders’ equity		444,101		392,557		376,634		351,913		327,540
Less: Intangible assets (5)		–		–		–		–		–
Tangible common shareholders’ equity (non-GAAP)	$	444,101	$	392,557	$	376,634	$	351,913	$	327,540

Common shares outstanding		8,492,856		8,212,026		8,127,690		7,977,690		7,804,052
Book value per common share	$	52.29	$	47.80	$	46.34	$	44.11	$	41.97
Tangible book value per share (non-GAAP) (6)		52.29		47.80		46.34		44.11		41.97

(1) The net interest rate spread represents the difference between the weighted-average yield on interest-earning assets and the weighted-average cost of interest-bearing liabilities for the period.
(2) The net interest margin represents net interest income as a percent of average interest-earning assets for the period.
(3) The efficiency ratio represents noninterest expense divided by the sum of net interest income (before the credit loss provision) plus noninterest income.
(4) For purposes of calculating this ratio, commercial real estate includes all non-owner occupied commercial real estate loans defined as such by regulatory guidance, including all land development and construction loans.
(5) Includes the loan servicing rights asset. (6) Tangible book value per share represents total shareholders’ equity less the sum of preferred stock and intangible assets divided by common shares outstanding.

For More Information:
Richard Cohen, Chief Financial Officer
Northeast Bank, 27 Pearl Street, Portland, Maine 04101
207.786.3245 ext. 3249
www.northeastbank.com

The MIL Network –

February 7, 2025

MIL-OSI USA: VIDEO: On Senate Floor, Rosen Opposes Confirmation of Project 2025 Co-Author Russell Vought as Director of the Office of Management and Budget

US Senate News:

Source: United States Senator Jacky Rosen (D-NV)

Senator Rosen: “Nevadans are hurting, and they are looking to Congress for help. If Vought is given the power to shape our federal budget, we risk seeing critical programs slashed, leaving our seniors, working people, families facing higher costs, fewer services, and with less financial security.”

Watch Senator Rosen’s Full Remarks HERE.
WASHINGTON, DC – Today, U.S. Senator Jacky Rosen (D-NV) took the Senate floor to oppose the confirmation of one of the key authors of Project 2025, Russell Vought, to lead the Office of Management and Budget. In her speech, Senator Rosen highlighted Mr. Vought’s extreme far-right views and plans that would harm hard-working families, including putting programs like Medicare and Social Security on the chopping block, and giving tax breaks to billionaires and big corporations on the backs of seniors and working families.
Below are excerpts of Senator Rosen’s floor remarks:
Mr. President,
Nevadans sent me to the Senate to stand up and fight for hardworking families throughout our state.
And that’s exactly why I’m here today – to sound the alarm about Russell Vought’s nomination to lead the Trump Administration’s Office of Management and Budget. They oversee virtually every agency and the entire federal budget.
Mr. Vought would be a disaster if he’s put in this role again.
Russell Vought vote is an extremist who will betray working families, betray your family – and there’s simply no other way to put it.
After all, he was the main architect behind [the] Project 2025 agenda.
You might have heard of it, but for those who don’t know, Project 2025 is Russell Vought’s far-right playbook for seizing full control of the federal government. I’m going to repeat that: this is he wrote the playbook to seize full control over the federal government. Our government. Your government.
It’s filled with extreme ideas that would hurt families like yours. Ideas like putting essential government programs like Medicare, Medicaid, Social Security on the chopping block. And it’s going to give handouts to billionaires and big corporations on the backs of America’s middle class. On your backs.
Seeing how much power this Administration has already given to unelected, unelected billionaire CEOs, it’s not hard to imagine what’s coming next.
[…]
I urge my colleagues who are considering a vote for this nomination to think about what working people in this country are going through at this moment.
I urge my colleagues to think about the Moms and the Dads who come home from a hard day at work. They have dinner with their family, they put their kids to bed, and then, instead of relaxing in front of the TV, they sit at the kitchen table, and they worry. And they’re worried sick about how they’re going to pay the bills, how they’re going to keep a roof over their head, how they’re going to keep putting food on the table.
They’re going back and forth, trying to figure out what essentials they can live without just to make ends meet.
At the same time, the billionaires that Russell Vought is looking out for, well, they don’t understand the struggle, I can bet you that. I’m going to say here: let’s ask those billionaires last time they went grocery shopping and worried about the price of eggs or milk. I bet they don’t have an answer for that. That’s who Mr. Vought fights for. And these struggles that real families are going through, they’re tough choices that far, far too many working families face every single day.
And these are the people who will be hurt most by Russell Vought’s extreme, extreme agenda.
And we know that, right now, these same families are feeling the squeeze of rising costs – it’s everywhere, the grocery store to the gas pump.
And with the added price spikes from President Trump’s reckless tariff threats, it’s going to get even harder to afford food, pay off an energy bill, or make rent – let alone, let alone buy a home.
And so, it’s no wonder people are so frustrated with the way things are – it shouldn’t have to be this way.
We should be looking for opportunities to help make their lives better – to make things a little easier.
At a time when Americans are already paying an arm and a leg for essentials – when they desperately need the support of critical government programs that make such a meaningful difference, why on earth would we confirm someone who will just make their lives harder? Why on earth would we do this?
So, make no mistake: if Russell Vought is allowed to head up the OMB, he, Vought will work to make sure the ultra-wealthy get more, while struggling families get even less than they have now. This is who Russel Vought is, and this is what he’ll do – what he’ll do to you.
Mr. President, Nevadans are hurting, and they are looking to Congress for help.
If Vought is given the power to shape our federal budget, we risk seeing critical programs slashed, leaving our seniors, working people, families facing higher costs, fewer services, and with less financial security.
And this isn’t just an ideological difference; it’s a real threat to millions of people’s well-being. To the very core of what’s most important to them: their families.
And the stakes couldn’t be higher. And so, I urge my colleagues in the Senate to reject this reckless nomination for the sake of all of our families.

MIL OSI USA News –

February 7, 2025

MIL-OSI Australia: Cost-of-living help for students visiting nation’s capital

Source: Australia Government Ministerial Statements

The Albanese Government is taking the pressure off family budgets by boosting travel rebates for students who visit the nation’s capital in 2025.

The Parliament and Civics Education Rebate (PACER) program provides financial assistance for students to visit Canberra and experience our national democratic, historical and cultural institutions first-hand.

Rebates have been extended for 2025 and will range up to $2,040 per student, depending on the location of the school, with additional loadings for eligible schools in disadvantaged, regional, and remote areas. Home schooling families are also eligible for the rebate.

These additional rebates, for example, take the rebate amount for a student from a remote, disadvantaged school in New South Wales, 500-999 kilometres from Canberra, from $45 to $165.

For a student from a very remote, disadvantaged school in the Northern Territory, 3,000 kilometres or more from Canberra, the rebate has increased from $510 to $2,040.

To further boost student knowledge of Australia’s system of government, legal system and Australian citizenship, a new online hub has been launched.

The Civics and Citizenship Education (CCE) Hub contains more than 200 nationally coordinated, high-quality teaching resources that will save teachers time and support them to teach students from Years 3 to 10.

Teachers have access to resources to help them run mock parliamentary debates and elections, quizzes, case studies and a range of other sources to support student learning.

The CCE Hub forms part of a suite of online resources and professional learning from the Albanese Government to support teaching and learning of the Australian Curriculum, with $34.6 million being invested over four years.

For more information on the PACER rebate including the eligibility criteria, visit www.pacer.org.au.

Quotes attributable to Minister for Education Jason Clare:

“It’s important to get out of the classroom and experience our historical and cultural institutions first-hand.

“To see and feel our history at the War Memorial and Old Parliament House, and see it being made in the new Parliament.

“That’s why the Albanese Government is helping families with cost-of-living by offering rebates to make it more affordable to come to the Capital.

“I want more Australian students, wherever they live, to do this and that’s what these rebates do.”

MIL OSI News –

February 7, 2025

MIL-OSI: First Pacific Bancorp Reports Fourth Quarter and Full Year 2024 Results

Source: GlobeNewswire (MIL-OSI)

WHITTIER, Calif., Feb. 06, 2025 (GLOBE NEWSWIRE) — First Pacific Bancorp (the “Company”) (OTC Pink: FPBC), the holding company for First Pacific Bank (the “Bank”), today reported consolidated results for the fourth quarter and year ending December 31, 2024, marking its seventh consecutive quarter of profitability. The Company remains well-capitalized, with a robust liquidity position supported by a stable core deposit base and access to substantial sources of liquidity.

Highlights for the fourth quarter and full year 2024 include:

Total assets ended 2024 at $433 million, up $13 million from $420 million at year end 2023.
Total deposits ended 2024 at $351 million, up $18 million since year end 2023.
Total loans ended 2024 at $277 million, up $2 million from year end 2023.
Asset quality remains excellent with minimal levels of classified or non-performing assets.
The Bank ended the fourth quarter with a strong capital position, with a leverage capital ratio of 9.0% and a total risk-based capital ratio of 13.4%.
As of December 31, 2024, cash and cash equivalents totaled $41 million, including funds invested overnight, up $19 million since year end 2023.
Unused borrowing capacity from credit facilities in place on December 31, 2024, totaled $167 million.

For the fourth quarter ending December 31, 2024, the Company realized a pre-tax, pre-provision profit of $702 thousand, compared to a pre-tax, pre-provision profit of $345 thousand in Q3 2024. Net income for the fourth quarter of 2024 was $500 thousand, up from $249 thousand in Q3 2024. For the twelve months ending December 31, 2024, the Company reported $1.1 million in net income, up from a net loss of $164 thousand reported for the twelve months ending December 31, 2023.

Asset quality remains excellent with minimal non-performing assets and the allowance for credit losses is 1.15% of total loans. There was no provision for credit losses recognized for the year ending 2024, compared to $906 thousand for the year ending December 31, 2023.

“We are pleased to close out 2024 on a strong note, achieving seven consecutive quarters of profitability and demonstrating the success of our strategic approach,” said Joe Matranga, Chairman of the Board of Directors. “With a solid capital position, strong liquidity, and sound financial standing, we are well-positioned to continue to execute our strategy and drive sustainable, long-term value for our stakeholders.”

“We delivered another strong quarter of financial results highlighted by loan and deposit growth, excellent asset quality, and a solid capital and liquidity position,” said Nathan Rogge, President and Chief Executive Officer. “We enter 2025 with strong momentum and a clear growth strategy, driven by strategic investments in technology and innovation designed to enhance the banking experience and reinforce our competitive advantage.”

“As a Southern California-based company, we are deeply saddened by the devastation caused by the recent wildfires. Our thoughts and prayers are with everyone impacted by this disaster and we are committed to helping Los Angeles move forward.”

ABOUT FIRST PACIFIC BANK

First Pacific Bank is a wholly owned subsidiary of First Pacific Bancorp (OTC Pink: FPBC) and is a growing community bank catering to individuals, professionals, and small-to-medium sized businesses throughout Southern California. Since opening in 2006, the Bank has offered a personalized approach, access to decision makers, a broad range of solutions, and a commitment to delivering an exceptional customer experience. First Pacific Bank operates locations in Los Angeles County, Orange County, San Diego County, and the Inland Empire. For more information, visit firstpacbank.com or call 888.BNK.AT.FPB.

FORWARD-LOOKING STATEMENTS

This news release may include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended, and First Pacific Bancorp intends for such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Future events are difficult to predict, and the expectations described above are necessarily subject to risk and uncertainty that may cause actual results to differ materially and adversely. Forward-looking statements relate to, among other things, our business plan, and strategies, and can be identified by the fact that they do not relate strictly to historical or current facts. They often include the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may” and similar expressions. These forward-looking statements are not guarantees of future performance, nor should they be relied upon as representing management’s views as of any subsequent date. Factors that might cause such differences include, but are not limited to: successfully realizing the benefits of our business strategy and plans,; changes in general economic and financial market conditions, either nationally or locally, in areas in which First Pacific Bank conducts its operations; effects of inflation and changes in interest rates; continuing consolidation in the financial services industry; new litigation or changes in existing litigation; increased competitive challenges and expanding product and pricing pressures among financial institutions; impact of any natural disasters, including earthquakes; effect of governmental supervision and regulation, including any regulatory or other enforcement actions; legislation or regulatory changes which adversely affect First Pacific Bank’s operations or business; loss of key personnel; and changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board or other regulatory agencies. The Company does not undertake, and specifically disclaims any obligation to update any forward-looking statements to reflect occurrences or unanticipated events, or circumstances after the date of such statements except as required by law.

— Summary Financial Tables Follow —

First PacificBancorp
Consolidated Balance Sheets
(Unaudited)
	Dec 31, 2024			Sep 30, 2024			Jun 30, 2024			Mar 31, 2024			Dec 31, 2023
ASSETS
Cash and due from banks	$	4,708,926		$	23,584,084		$	4,671,483		$	7,317,500		$	4,308,149
Fed funds sold & int-bearing balances		36,290,000			25,520,000			37,860,000			37,575,000			18,060,000
Total cash and cash equivalents		40,998,926			49,104,084			42,531,483			44,892,500			22,368,149

Debt securities (AFS)		1,866,022			3,041,852			3,077,666			5,138,340			5,257,049
Debt securities (HTM)		100,257,560			101,260,391			102,202,926			103,474,749			104,343,133
Total debt securities		102,123,582			104,302,243			105,280,592			108,613,089			109,600,182

Construction & land development		23,320,351			23,067,204			24,651,513			25,480,398			27,070,749
1-4 Family residential		58,588,090			58,082,570			68,588,393			68,521,663			66,567,165
Multifamily residential		28,561,276			28,966,811			26,800,829			26,947,419			27,128,177
Nonfarm, nonresidential real estate		100,066,570			99,715,860			94,643,169			97,893,840			99,627,812
Commercial & industrial		62,322,690			57,342,017			53,504,969			54,785,564			53,938,659
Consumer & Other		4,525,108			780,639			1,831,036			1,123,918			865,849
Total loans		277,384,085			267,955,101			270,019,909			274,752,802			275,198,411
Allowance for credit losses (loans)		(3,179,637	)		(3,109,975	)		(3,109,975	)		(3,109,975	)		(3,109,975	)
Total loans, net		274,204,448			264,845,126			266,909,934			271,642,827			272,088,436

Premises, equipment, and ROU net		1,328,964			1,452,886			1,714,833			1,992,588			2,268,671
Goodwill, core deposit & other intangibles		1,273,134			1,287,129			1,298,084			1,313,367			1,328,651
Bank owned life insurance		5,287,738			5,257,550			5,227,763			5,198,654			5,170,521
Accrued interest and other assets		7,755,355			7,505,380			7,476,554			7,415,609			7,392,301

Total Assets	$	432,972,147		$	433,754,398		$	430,439,243		$	441,068,634		$	420,216,911

LIABILITIES AND SHAREHOLDERS’ EQUITY
Deposits:
Noninterest-bearing demand	$	131,515,568		$	129,473,091		$	144,240,187		$	133,945,262		$	121,348,095
Interest-bearing transaction accounts		28,454,639			24,660,000			24,797,108			28,166,207			34,716,150
Money market and savings		146,423,126			143,270,628			143,497,864			148,732,230			139,011,862
Time deposits		44,302,867			44,388,137			41,060,590			38,662,227			38,235,413
Total deposits		350,696,200			341,791,856			353,595,749			349,505,926			333,311,520

Borrowings		40,000,000			50,000,000			35,000,000			50,000,000			45,000,000
Accrued interest and other liabilities		3,122,902			3,430,132			3,781,444			3,936,909			4,530,208
Total liabilities		393,819,102			395,221,988			392,377,193			403,442,835			382,841,728

Shareholders’ Equity:
Capital stock and APIC		37,272,567			37,117,627			36,970,386			36,788,606			36,699,786
Retained earnings		2,650,877			2,151,305			1,902,788			1,705,174			1,543,264
Accum other comprehensive income		(770,399	)		(736,522	)		(811,124	)		(867,981	)		(867,867	)
Total shareholders’ equity		39,153,045			38,532,410			38,062,050			37,625,799			37,375,183

Total Liabilities and Shareholders’ Equity	$	432,972,147		$	433,754,398		$	430,439,243		$	441,068,634		$	420,216,911

First PacificBancorp
Consolidated Income Statements – Quarterly
(Unaudited)

	Dec 31, 2024		Sep 30, 2024		Jun 30, 2024		Mar 31, 2024		Dec 31, 2023
INTEREST INCOME
Loans, including fees	$	4,814,128	$	4,817,174	$	4,655,844	$	4,700,535	$	4,653,303
Debt securities		484,508		499,268		514,613		543,857		544,330
Fed funds & int-bearing balances		419,597		450,166		573,022		410,685		258,178
Total interest income		5,718,233		5,766,608		5,743,479		5,655,077		5,455,811

INTEREST EXPENSE
Deposits		1,777,351		1,790,578		1,687,121		1,746,032		1,542,541
Borrowings		332,375		444,250		524,599		507,390		705,324
Total interest expense		2,109,726		2,234,828		2,211,720		2,253,422		2,247,865

Net interest income		3,608,507		3,531,780		3,531,759		3,401,655		3,207,946

Provision for credit losses		–		–		–		–		101,538

Net interest income after provision		3,608,507		3,531,780		3,531,759		3,401,655		3,106,408

NONINTEREST INCOME
Service charges, fees and other income		119,173		106,628		96,460		108,365		108,769
Sublease income		–		53,975		52,970		53,872		53,872
Gains (losses) on sale of assets		–		15,335		–		–		(12,982	)
Gains on early payoff of debt		54,125		–		144,325		–		–
Total noninterest income		173,298		175,938		293,755		162,237		149,659

NONINTEREST EXPENSE
Salaries and benefits		1,984,774		2,154,290		2,182,674		2,178,486		1,954,029
Occupancy and equipment		258,180		374,069		363,695		368,816		384,088
Other expense		836,692		834,281		1,007,247		794,158		894,440
Total noninterest expense		3,079,646		3,362,640		3,553,616		3,341,460		3,232,557

Income before income tax expense		702,159		345,078		271,898		222,432		23,510

Income tax expense (benefit)		202,586		96,563		74,281		60,524		(31,955	)

Net Income	$	499,573	$	248,515	$	197,617	$	161,908	$	55,465

Earnings per share basic (QTR)	$	0.12	$	0.06	$	0.05	$	0.04	$	0.01
Weighted average shares outstanding (QTR)		4,293,829		4,288,851		4,283,351		4,281,653		4,231,841

First PacificBancorp
Consolidated Income Statements – Year-to-Date
(Unaudited)

	Dec 31, 2024		Dec 31, 2023
INTEREST INCOME
Loans, including fees	$	18,987,681	$	16,705,212
Investment securities		2,042,246		2,279,349
Fed funds & int-bearing balances		1,853,470		1,000,827
Total interest income		22,883,397		19,985,388

INTEREST EXPENSE
Deposits		7,001,082		4,744,486
Borrowings		1,808,614		2,440,727
Total interest expense		8,809,696		7,185,213

Net interest income		14,073,701		12,800,175

Provision for credit losses		–		905,966

Net interest income after provision		14,073,701		11,894,209

NONINTEREST INCOME
Service charges, fees and other income		430,626		455,823
Sublease income		160,817		212,074
Gains (losses) on sale of assets		15,335		129,093
Gains on early payoff of debt		198,450		123,077
Total noninterest income		805,228		920,067

NON INTEREST EXPENSE
Salaries and benefits		8,500,224		8,558,603
Occupancy and equipment		1,364,760		1,470,277
Other expense		3,472,378		3,124,577
Total noninterest expense		13,337,362		13,153,457

Income before income tax expense		1,541,567		(339,181	)

Income tax expense (benefit)		433,954		(175,262	)

Net Income (loss)	$	1,107,613	$	(163,919	)

Earnings (loss) per share basic (YTD)	$	0.26	$	(0.04	)
Weighted average shares outstanding (YTD)		4,286,945		3,992,738

First PacificBancorp
Quarterly Financial Highlights
(Unaudited)
		Quarterly
		2024		2024		2024		2024		2023
($ in thousands except per share data)		4th Qtr		3rd Qtr		2nd Qtr		1st Qtr		4th Qtr
EARNINGS
Net interest income	$	3,609		3,532		3,532		3,402		3,208
Provision for loan losses	$	0		0		0		0		102
Noninterest income	$	173		176		294		162		150
Noninterest expense	$	3,080		3,363		3,554		3,341		3,233
Income tax expense	$	203		97		74		61		(32	)
Net income	$	500		249		198		162		55

Earnings per share basic	$	0.12		0.06		0.05		0.04		0.01
Weighted average shares outstanding		4,293,829		4,288,851		4,283,351		4,281,653		4,231,841
Ending shares outstanding		4,294,500		4,291,927		4,283,351		4,283,351		4,231,841

PERFORMANCE RATIOS
Return on average assets		0.47	%	0.23	%	0.18	%	0.15	%	0.05	%
Return on average common equity		5.12	%	2.58	%	2.10	%	1.73	%	0.59	%
Yield on loans		6.91	%	6.98	%	6.97	%	6.84	%	6.69	%
Yield on earning assets		5.50	%	5.58	%	5.52	%	5.49	%	5.35	%
Cost of deposits		1.98	%	2.05	%	1.96	%	2.05	%	1.89	%
Cost of funding		2.18	%	2.32	%	2.28	%	2.35	%	2.37	%
Net interest margin		3.47	%	3.42	%	3.40	%	3.31	%	3.15	%
Efficiency ratio		81.4	%	90.7	%	92.9	%	93.8	%	96.3	%

CAPITAL
Tangible equity to tangible assets		8.77	%	8.61	%	8.57	%	8.26	%	8.61	%
Book value (BV) per common share	$	9.12		8.98		8.89		8.78		8.83
Tangible BV per common share	$	8.82		8.68		8.58		8.48		8.52

ASSET QUALITY
Net loan charge-offs (recoveries)	$	0		0		0		0		0
Allowance for credit losses (loans)	$	3,180		3,110		3,110		3,110		3,110
Allowance to total loans		1.15	%	1.16	%	1.15	%	1.13	%	1.13	%
Nonperforming loans	$	672		991		77		160		61

END OF PERIOD BALANCES
Total loans	$	277,384		267,955		270,020		274,753		275,198
Total assets	$	432,972		433,754		430,439		441,069		420,217
Deposits	$	350,696		341,792		353,596		349,506		333,312
Loans to deposits		79.1	%	78.4	%	76.4	%	78.6	%	82.6	%
Shareholders’ equity	$	39,153		38,532		38,062		37,626		37,375
Full-time equivalent employees		49		44		44		46		45

AVERAGE BALANCES (QTRLY)
Total loans	$	276,294		273,960		267,766		275,578		276,016
Earning assets	$	412,417		410,298		416,965		412,791		404,210
Total assets	$	425,750		424,199		430,830		426,592		417,595
Deposits	$	355,369		346,142		346,032		341,226		323,300
Shareholders’ equity	$	38,746		38,267		37,788		37,443		37,179

The MIL Network –

February 7, 2025

MIL-OSI: NMI Holdings, Inc. Reports Fourth Quarter and Full Year 2024 Financial Results; Announces Additional $250 Million Share Repurchase Authorization

Source: GlobeNewswire (MIL-OSI)

EMERYVILLE, Calif., Feb. 06, 2025 (GLOBE NEWSWIRE) — NMI Holdings, Inc. (Nasdaq: NMIH) today reported net income of $86.2 million, or $1.07 per diluted share, for the fourth quarter ended December 31, 2024, which compares to $92.8 million, or $1.15 per diluted share, for the third quarter ended September 30, 2024 and $83.4 million, or $1.01 per diluted share, for the fourth quarter ended December 31, 2023. Adjusted net income for the quarter was $86.1 million, or $1.07 per diluted share, which compares to $92.8 million, or $1.15 per diluted share, for the third quarter ended September 30, 2024 and $83.4 million, or $1.01 per diluted share, for the fourth quarter ended December 31, 2023.

Net income for the full year ended December 31, 2024 was $360.1 million, or $4.43 per diluted share, which compares to $322.1 million, or $3.84 per diluted share, for the year ended December 31, 2023. Adjusted net income for the year was $365.6 million, or $4.50 per diluted share, which compares to $322.1 million, or $3.84 per diluted share, for the year ended December 31, 2023. The non-GAAP financial measures adjusted net income and adjusted diluted earnings per share are presented in this release to enhance the comparability of financial results between periods. See “Use of Non-GAAP Financial Measures” and our reconciliation of such measures to their most comparable GAAP measures, below.

The company also announced today that its Board of Directors has authorized an additional $250 million share repurchase plan effective through December 31, 2027.

Adam Pollitzer, President and Chief Executive Officer of National MI, said, “The fourth quarter capped another year of standout success for National MI. In 2024, we delivered strong operating performance, generated significant NIW volume and consistent growth in our insured portfolio, and achieved record financial results and a 17.4% return on equity. We have a strong customer franchise, a talented team driving us forward every day, an exceptionally high-quality book covered by a comprehensive set of risk transfer solutions, and a robust balance sheet supported by the significant earnings power of our platform. Looking forward, we’re well-positioned to continue delivering differentiated growth, returns and value for our shareholders, and today’s incremental $250 million share repurchase authorization will provide investors with further ability to access value as we continue to perform, grow our earnings and compound book value.”

Selected fourth quarter 2024 highlights include:

Primary insurance-in-force at quarter end was $210.2 billion, compared to $207.5 billion at the end of the third quarter and $197.0 billion at the end of the fourth quarter of 2023.
Net premiums earned were $143.5 million, compared to $143.3 million in the third quarter and $132.9 million in the fourth quarter of 2023.
Total revenue was $166.5 million, compared to $166.1 million in the third quarter and $151.4 million in the fourth quarter of 2023.
Insurance claims and claim expenses were $17.3 million, compared to $10.3 million in the third quarter and $8.2 million in the fourth quarter of 2023. Loss ratio was 12.0%, compared to 7.2% in the third quarter and 6.2% in the fourth quarter of 2023.
Underwriting and operating expenses were $31.1 million, compared to $29.2 million in the third quarter and $29.7 million in the fourth quarter of 2023. Expense ratio was 21.7%, compared to 20.3% in the third quarter and 22.4% in the fourth quarter of 2023.
Net income was $86.2 million, compared to $92.8 million in the third quarter and $83.4 million in the fourth quarter of 2023. Diluted EPS was $1.07, compared to $1.15 in the third quarter and $1.01 in the fourth quarter of 2023.
Shareholders’ equity was $2.2 billion at quarter end and book value per share was $28.21. Book value per share excluding the impact of net unrealized gains and losses in the investment portfolio was $29.80, up 4% compared to $28.71 in the third quarter and 17% compared to $25.54 in the fourth quarter of 2023.
Annualized return on equity for the quarter was 15.6%, compared to 17.5% in the third quarter and 18.0% in the fourth quarter of 2023.
At quarter-end, total PMIERs available assets were $3.1 billion and net risk-based required assets were $1.8 billion.

	Quarter Ended			Quarter Ended			Quarter Ended			*Change*⁽¹⁾		*Change*⁽¹⁾
	*12/31/2024*			*9/30/2024*			*12/31/2023*			*Q/Q*		*Y/Y*
INSURANCE METRICS ($billions)
Primary Insurance-in-Force	$	210.2		$	207.5		$	197.0		1	%	7	%
New Insurance Written – NIW		11.9			12.2			8.9		(2	)%	34	%

FINANCIAL HIGHLIGHTS (Unaudited, $millions, except per share amounts)
Net Premiums Earned	$	143.5		$	143.3		$	132.9		0	%	8	%
Net Investment Income		22.7			22.5			18.2		1	%	25	%
Insurance Claims and Claim Expenses		17.3			10.3			8.2		67	%	110	%
Underwriting and Operating Expenses		31.1			29.2			29.7		7	%	5	%
Net Income		86.2			92.8			83.4		(7	)%	3	%
Diluted EPS	$	1.07		$	1.15		$	1.01		(7	)%	6	%
Book Value per Share (excluding net unrealized gains and losses) ⁽²⁾	$	29.80		$	28.71		$	25.54		4	%	17	%
Loss Ratio		12.0	%		7.2	%		6.2	%
Expense Ratio		21.7	%		20.3	%		22.4	%

(1) Percentages may not be replicated based on the rounded figures presented in the table.
(2) Book value per share (excluding net unrealized gains and losses) is defined as total shareholders’ equity, excluding the after-tax effects of unrealized gains and losses on our investment portfolio, divided by shares outstanding.

Conference Call and Webcast Details

The company will hold a conference call, which will be webcast live today, February 6, 2025, at 2:00 p.m. Pacific Time / 5:00 p.m. Eastern Time. The webcast will be available on the company’s website, www.nationalmi.com, in the “Investor Relations” section. The conference call can also be accessed by dialing (844) 481-2708 in the U.S., or (412) 317-0664 internationally, by referencing NMI Holdings, Inc.

About NMI Holdings, Inc.

NMI Holdings, Inc. (NASDAQ: NMIH), is the parent company of National Mortgage Insurance Corporation (National MI), a U.S.-based, private mortgage insurance company enabling low down payment borrowers to realize home ownership while protecting lenders and investors against losses related to a borrower’s default. To learn more, please visit www.nationalmi.com.

Cautionary Note Regarding Forward-Looking Statements

Certain statements contained in this press release or any other written or oral statements made by or on behalf of the Company in connection therewith may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the U.S. Private Securities Litigation Reform Act of 1995 (the “PSLRA”). The PSLRA provides a “safe harbor” for any forward-looking statements. All statements other than statements of historical fact included in or incorporated by reference in this release are forward-looking statements, including any statements about our expectations, outlook, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance. These statements are often, but not always, made through the use of words or phrases such as “anticipate,” “believe,” “can,” “could,” “may,” “predict,” “assume,” “potential,” “should,” “will,” “estimate,” “perceive,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “intend” and similar words or phrases. All forward-looking statements are only predictions and involve estimates, known and unknown risks, assumptions and uncertainties that may turn out to be inaccurate and could cause actual results to differ materially from those expressed in them. Many risks and uncertainties are inherent in our industry and markets. Others are more specific to our business and operations. Important factors that could cause actual events or results to differ materially from those indicated in such statements include, but are not limited to: changes in general economic, market and political conditions and policies (including changes in interest rates and inflation) and investment results or other conditions that affect the U.S. housing market or the U.S. markets for home mortgages, mortgage insurance, reinsurance and credit risk transfer markets, including the risk related to geopolitical instability, inflation, an economic downturn (including any decline in home prices) or recession, and their impacts on our business, operations and personnel; changes in the charters, business practices, policies, pricing or priorities of Fannie Mae and Freddie Mac (collectively, the GSEs), which may include decisions that have the impact of decreasing or discontinuing the use of mortgage insurance as credit enhancement generally, or with first time homebuyers or on very high loan-to-value mortgages; or changes in the direction of housing policy objectives of the Federal Housing Finance Agency (“FHFA”), such as the FHFA’s priority to increase the accessibility to and affordability of homeownership for low-and-moderate income borrowers and underrepresented communities; our ability to remain an eligible mortgage insurer under the private mortgage insurer eligibility requirements (“PMIERs”) and other requirements imposed by the GSEs, which they may change at any time; retention of our existing certificates of authority in each state and the District of Columbia (“D.C.”) and our ability to remain a mortgage insurer in good standing in each state and D.C.; our future profitability, liquidity and capital resources; actions of existing competitors, including other private mortgage insurers and government mortgage insurers such as the Federal Housing Administration, the U.S. Department of Agriculture’s Rural Housing Service and the U.S. Department of Veterans Affairs, and potential market entry by new competitors or consolidation of existing competitors; adoption of new or changes to existing laws, rules and regulations that impact our business or financial condition directly or the mortgage insurance industry generally or their enforcement and implementation by regulators, including the implementation of the final rules defining and/or concerning “Qualified Mortgage” and “Qualified Residential Mortgage”; U.S. federal tax reform and other potential changes in tax law and their impact on us and our operations; legislative or regulatory changes to the GSEs’ role in the secondary mortgage market or other changes that could affect the residential mortgage industry generally or mortgage insurance industry in particular; potential legal and regulatory claims, investigations, actions, audits or inquiries that could result in adverse judgements, settlements, fines or other reliefs that could require significant expenditures or have other negative effects on our business; our ability to successfully execute and implement our capital plans, including our ability to access the equity, credit and reinsurance markets and to enter into, and receive approval of, reinsurance arrangements on terms and conditions that are acceptable to us, the GSEs and our regulators; lenders, the GSEs, or other market participants seeking alternatives to private mortgage insurance; our ability to implement our business strategy, including our ability to write mortgage insurance on high quality low down payment residential mortgage loans, implement successfully and on a timely basis, complex infrastructure, systems, procedures, and internal controls to support our business and regulatory and reporting requirements of the insurance industry; our ability to attract and retain a diverse customer base, including the largest mortgage originators; failure of risk management or pricing or investment strategies; decrease in the length of time our insurance policies are in force; emergence of unexpected claim and coverage issues, including claims exceeding our reserves or amounts we had expected to experience; potential adverse impacts arising from natural disasters including, with respect to affected areas, a decline in new business, adverse effects on home prices, and an increase in notices of default on insured mortgages; climate risk and efforts to manage or regulate climate risk by government agencies could affect our business and operations; potential adverse impacts arising from the occurrence of any man-made disasters or public health emergencies, including pandemics; the inability of our counter-parties, including third party reinsurers, to meet their obligations to us; failure to maintain, improve and continue to develop necessary information technology systems or the failure of technology providers to perform; effectiveness and security of our information technology systems and digital products and services, including the risks these systems, products or services may fail to operate as expected or planned, or expose us to cybersecurity or third-party risks (including the exposure of our confidential customer and other information); and ability to recruit, train and retain key personnel. These risks and uncertainties also include, but are not limited to, those set forth under the heading “Risk Factors” detailed in Item 1A of Part I of our Annual Report on Form 10-K for the year ended December 31, 2023, as subsequently updated through other reports we file with the SEC. All subsequent written and oral forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. We caution you not to place undue reliance on any forward-looking statement, which speaks only as of the date on which it is made, and we undertake no obligation to publicly update or revise any forward-looking statement to reflect new information, future events or circumstances that occur after the date on which the statement is made or to reflect the occurrence of unanticipated events except as required by law.

Use of Non-GAAP Financial Measures

We believe the use of the non-GAAP measures of adjusted income before tax, adjusted net income, adjusted diluted EPS, adjusted return-on-equity, adjusted expense ratio, adjusted combined ratio and book value per share (excluding net unrealized gains and losses) enhances the comparability of our fundamental financial performance between periods, and provides relevant information to investors. These non-GAAP financial measures align with the way the company’s business performance is evaluated by management. These measures are not prepared in accordance with GAAP and should not be viewed as alternatives to GAAP measures of performance. These measures have been presented to increase transparency and enhance the comparability of our fundamental operating trends across periods. Other companies may calculate these measures differently; their measures may not be comparable to those we calculate and present.

Adjusted income before tax is defined as GAAP income before tax, excluding the pre-tax effects of net realized gains or losses from our investment portfolio, periodic costs incurred in connection with capital markets transactions, and other infrequent, unusual or non-operating items in the periods in which such items are incurred.

Adjusted net income is defined as GAAP net income, excluding the after-tax effects of net realized gains or losses from our investment portfolio, periodic costs incurred in connection with capital markets transactions, and other infrequent, unusual or non-operating items in the periods in which such items are incurred. Adjustments to components of pre-tax income are tax effected using the applicable federal statutory tax rate for the respective periods.

Adjusted diluted EPS is defined as adjusted net income divided by adjusted weighted average diluted shares outstanding. Adjusted weighted average diluted shares outstanding is defined as weighted average diluted shares outstanding, adjusted for changes in the dilutive effect of non-vested shares that would otherwise have occurred had GAAP net income been calculated in accordance with adjusted net income. There will be no adjustment to weighted average diluted shares outstanding in the periods that non-vested shares are anti-dilutive under GAAP.

Adjusted return on equity is calculated by dividing adjusted net income on an annualized basis by the average shareholders’ equity for the period.

Adjusted expense ratio is defined as GAAP underwriting and operating expenses, excluding the pre-tax effects of periodic costs incurred in connection with capital markets transactions, divided by net premiums earned.

Adjusted combined ratio is defined as the total of GAAP underwriting and operating expenses, excluding the pre-tax effects of periodic costs incurred in connection with capital markets transactions and insurance claims and claims expenses, divided by net premiums earned.

Book value per share (excluding net unrealized gains and losses) is defined as total shareholders’ equity, excluding the after-tax effects of unrealized gains and losses on investments, divided by shares outstanding.

Although adjusted income before tax, adjusted net income, adjusted diluted EPS, adjusted return-on-equity, adjusted expense ratio, adjusted combined ratio and book value per share (excluding net unrealized gains and losses) exclude certain items that have occurred in the past and are expected to occur in the future, the excluded items: (1) are not viewed as part of the operating performance of our primary activities; or (2) are impacted by market, economic or regulatory factors and are not necessarily indicative of operating trends, or both. These adjustments, and the reasons for their treatment, are described below.

(1) Net realized investment gains and losses. The recognition of the net realized investment gains or losses can vary significantly across periods as the timing is highly discretionary and is influenced by factors such as market opportunities, tax and capital profile, and overall market cycles that do not reflect our current period operating results.
(2) Capital markets transaction costs. Capital markets transaction costs result from activities that are undertaken to improve our debt profile or enhance our capital position through activities such as debt refinancing and capital markets reinsurance transactions that may vary in their size and timing due to factors such as market opportunities, tax and capital profile, and overall market cycles.
(3) Other infrequent, unusual or non-operating items. Items that are the result of unforeseen or uncommon events, and are not expected to recur with frequency in the future. Identification and exclusion of these items provides clarity about the impact special or rare occurrences may have on our current financial performance. Past adjustments under this category include infrequent, unusual or non-operating adjustments related to severance, restricted stock modification and other expenses incurred in connection with the CEO transition announced in September 2021 and the effects of the release of the valuation allowance recorded against our net federal and certain state net deferred tax assets in 2016 and the re-measurement of our net deferred tax assets in connection with tax reform in 2017. We believe such items are infrequent or non-recurring in nature, and are not indicative of the performance of, or ongoing trends in, our primary operating activities or business.
(4) Net unrealized gains and losses on investments. The recognition of the net unrealized gains or losses on investment can vary significantly across periods and is influenced by factors such as interest rate movement, overall market and economic conditions, and tax and capital profiles. These valuation adjustments may not necessarily result in economic gains or losses and not reflective of ongoing operations.

Investor Contact
Gregory Epps
Manager, Investor Relations and Treasury
Investor.relations@nationalmi.com

Consolidated statements of operations and comprehensive income (unaudited)	For the three months ended December 31,						For the year ended December 31,
		2024			2023			2024			2023
	(In Thousands, except for per share data)
Revenues
Net premiums earned	$	143,520		$	132,940		$	564,688		$	510,768
Net investment income		22,718			18,247			85,316			67,512
Net realized investment gains (losses)		33			—			23			(33	)
Other revenues		233			193			944			756
Total revenues		166,504			151,380			650,971			579,003
Expenses
Insurance claims and claim expenses		17,253			8,232			31,544			22,618
Underwriting and operating expenses		31,092			29,716			118,397			110,699
Service expenses		184			185			723			771
Interest expense		7,102			8,066			36,896			32,212
Total expenses		55,631			46,199			187,560			166,300

Income before income taxes		110,873			105,181			463,411			412,703
Income tax expense		24,706			21,768			103,305			90,593
Net income	$	86,167		$	83,413		$	360,106		$	322,110

Earnings per share
Basic	$	1.09		$	1.03		$	4.51		$	3.91
Diluted	$	1.07		$	1.01		$	4.43		$	3.84

Weighted average common shares outstanding
Basic		78,997			81,005			79,844			82,407
Diluted		80,623			82,685			81,273			83,854

Loss ratio ⁽¹⁾		12.0	%		6.2	%		5.6	%		4.4	%
Expense ratio ⁽²⁾		21.7	%		22.4	%		21.0	%		21.7	%
Combined ratio ⁽³⁾		33.7	%		28.5	%		26.6	%		26.1	%

Net income	$	86,167		$	83,413		$	360,106		$	322,110
Other comprehensive (loss) income, net of tax:
Unrealized (losses) gains in accumulated other comprehensive loss, net of tax (benefit) expense of $(11,374) and $19,580 for the three months ended December 31, 2024 and 2023, and $3,921 and $17,113 for the years ended December 31, 2024 and 2023, respectively		(42,787	)		73,660			15,113			64,380
Reclassification adjustment for realized (gains) losses included in net income, net of tax expense (benefit) of $7 and $0 for the three months ended December 31, 2024 and 2023, and $0 and $(7) for the years ended December 31, 2024, and 2023, respectively		(26	)		—			—			26
Other comprehensive (loss) income, net of tax		(42,813	)		73,660			15,113			64,406
Comprehensive income	$	43,354		$	157,073		$	375,219		$	386,516

(1) Loss ratio is calculated by dividing insurance claims and claim expenses by net premiums earned.
(2) Expense ratio is calculated by dividing underwriting and operating expenses by net premiums earned.
(3) Combined ratio may not foot due to rounding.

Consolidated balance sheets (unaudited)	December 31, 2024			December 31, 2023
Assets	(In Thousands, except for share data)
Fixed maturities, available-for-sale, at fair value (amortized cost of $2,876,343 and $2,542,862 as of December 31, 2024 and December 31, 2023, respectively)	$	2,723,541		$	2,371,021
Cash and cash equivalents (including restricted cash of $90 and $1,338 as of December 31, 2024 and December 31, 2023, respectively)		54,308			96,689
Premiums receivable, net		82,804			76,456
Accrued investment income		22,386			19,785
Deferred policy acquisition costs, net		64,327			62,905
Software and equipment, net		25,681			30,252
Intangible assets and goodwill		3,634			3,634
Reinsurance recoverable		32,260			27,514
Prepaid federal income taxes		322,175			235,286
Other assets		18,857			16,965
Total assets	$	3,349,973		$	2,940,507

Liabilities
Debt	$	415,146		$	397,595
Unearned premiums		65,217			92,295
Accounts payable and accrued expenses		103,164			86,189
Reserve for insurance claims and claim expenses		152,071			123,974
Deferred tax liability, net		386,192			301,573
Other liabilities		10,751			12,877
Total liabilities		1,132,541			1,014,503

Shareholders’ equity
Common stock – $0.01 par value; 87,902,626 shares issued and 78,600,726 shares outstanding as of December 31, 2024 and 87,334,138 shares issued and 80,881,280 shares outstanding as of December 31, 2023 (250,000,000 shares authorized)		879			873
Additional paid-in capital		1,004,692			990,816
Treasury stock, at cost: 9,301,900 and 6,452,858 common shares as of December 31, 2024 and December 31, 2023, respectively		(246,594	)		(148,921	)
Accumulated other comprehensive loss, net of tax		(124,804	)		(139,917	)
Retained earnings		1,583,259			1,223,153
Total shareholders’ equity		2,217,432			1,926,004
Total liabilities and shareholders’ equity	$	3,349,973		$	2,940,507

Non-GAAP Financial Measure Reconciliations (unaudited)
	As of and for the three months ended									For the year ended December 31,
	12/31/2024			9/30/2024			12/31/2023				2024			2023
As Reported	(In Thousands, except for per share data)
Revenues
Net premiums earned	$	143,520		$	143,343		$	132,940		$	564,688		$	510,768
Net investment income		22,718			22,474			18,247			85,316			67,512
Net realized investment gains (losses)		33			(10	)		—			23			(33	)
Other revenues		233			285			193			944			756
Total revenues		166,504			166,092			151,380			650,971			579,003
Expenses
Insurance claims and claim expenses		17,253			10,321			8,232			31,544			22,618
Underwriting and operating expenses		31,092			29,160			29,716			118,397			110,699
Service expenses		184			208			185			723			771
Interest expense		7,102			7,076			8,066			36,896			32,212
Total expenses		55,631			46,765			46,199			187,560			166,300

Income before income taxes		110,873			119,327			105,181			463,411			412,703
Income tax expense		24,706			26,517			21,768			103,305			90,593
Net income	$	86,167		$	92,810		$	83,413		$	360,106		$	322,110

Adjustments:
Net realized investment (gains) losses		(33	)		10			—			(23	)		33
Capital markets transaction costs		—			—			—			6,966			—
Adjusted income before taxes		110,840			119,337			105,181			470,354			412,736

Income tax (benefit) expense on adjustments ⁽¹⁾		(7	)		2			—			1,458			7
Adjusted net income	$	86,141		$	92,818		$	83,413		$	365,591		$	322,136

Weighted average diluted shares outstanding		80,623			81,045			82,685			81,273			83,854

Diluted EPS	$	1.07		$	1.15		$	1.01		$	4.43		$	3.84
Adjusted diluted EPS	$	1.07		$	1.15		$	1.01		$	4.50		$	3.84

Return on equity		15.6	%		17.5	%		18.0	%		17.4	%		18.2	%
Adjusted return on equity		15.6	%		17.5	%		18.0	%		17.6	%		18.2	%

Expense ratio ⁽²⁾		21.7	%		20.3	%		22.4	%		21.0	%		21.7	%
Adjusted expense ratio ⁽³⁾		21.7	%		20.3	%		22.4	%		21.0	%		21.7	%

Combined ratio ⁽⁴⁾		33.7	%		27.5	%		28.5	%		26.6	%		26.1	%
Adjusted combined ratio ⁽⁵⁾		33.7	%		27.5	%		28.5	%		26.6	%		26.1	%

Book value per share ⁽⁶⁾	$	28.21		$	27.67		$	23.81
Book value per share (excluding net unrealized gains and losses) ⁽⁷⁾	$	29.80		$	28.71		$	25.54

(1) Marginal tax impact of non-GAAP adjustments is calculated based on our statutory U.S. federal corporate income tax rate of 21%, except for those items that are not eligible for an income tax deduction.
(2) Expense ratio is calculated by dividing underwriting and operating expenses by net premiums earned.
(3) Adjusted expense ratio is calculated by dividing adjusted underwriting and operating expense (underwriting and operating expenses excluding costs related to capital markets reinsurance transactions) by net premiums earned.
(4) Combined ratio is calculated by dividing the total of underwriting and operating expenses and insurance claims and claim expenses by net premiums earned.
(5) Adjusted combined ratio is calculated by dividing the total of adjusted underwriting and operating expenses (underwriting and operating expenses excluding costs related to capital market reinsurance transaction) and insurance claims and claim expenses by net premiums earned.
(6) Book value per share is calculated by dividing total shareholders’ equity by shares outstanding.
(7) Book value per share (excluding net unrealized gains and losses) is defined as total shareholders’ equity, excluding the after-tax effects of unrealized gains and losses on our investment portfolio, divided by shares outstanding.

Historical Quarterly Data	2024												2023
	December 31			September 30			June 30			March 31			December 31
	(In Thousands, except for per share data)
Revenues
Net premiums earned	$	143,520		$	143,343		$	141,168		$	136,657		$	132,940
Net investment income		22,718			22,474			20,688			19,436			18,247
Net realized investment gains (losses)		33			(10	)		—			—			—
Other revenues		233			285			266			160			193
Total revenues		166,504			166,092			162,122			156,253			151,380
Expenses
Insurance claims and claim expenses		17,253			10,321			276			3,694			8,232
Underwriting and operating expenses		31,092			29,160			28,330			29,815			29,716
Service expenses		184			208			194			137			185
Interest expense		7,102			7,076			14,678			8,040			8,066
Total expenses		55,631			46,765			43,478			41,686			46,199

Income before income taxes		110,873			119,327			118,644			114,567			105,181
Income tax expense		24,706			26,517			26,565			25,517			21,768
Net income	$	86,167		$	92,810		$	92,079		$	89,050		$	83,413

Earnings per share
Basic	$	1.09		$	1.17		$	1.15		$	1.10		$	1.03
Diluted	$	1.07		$	1.15		$	1.13		$	1.08		$	1.01

Weighted average common shares outstanding
Basic		78,997			79,549			80,117			80,726			81,005
Diluted		80,623			81,045			81,300			82,099			82,685

Other data
Loss ratio ⁽¹⁾		12.0	%		7.2	%		0.2	%		2.7	%		6.2	%
Expense ratio ⁽²⁾		21.7	%		20.3	%		20.1	%		21.8	%		22.4	%
Combined ratio ⁽³⁾		33.7	%		27.5	%		20.3	%		24.5	%		28.5	%

(1) Loss ratio is calculated by dividing insurance claims and claim expenses by net premiums earned.
(2) Expense ratio is calculated by dividing underwriting and operating expenses by net premiums earned.
(3) Combined ratio may not foot due to rounding.

Portfolio Statistics

The table below highlights trends in our primary portfolio as of the date and for the periods indicated.

Primary portfolio trends	As of and for the three months ended
	December 31, 2024			September 30, 2024			June 30, 2024			March 31, 2024			December 31, 2023
	($ Values In Millions, except as noted below)
New insurance written (NIW)	$	11,925		$	12,218		$	12,503		$	9,398		$	8,927
New risk written		3,134			3,245			3,335			2,486			2,354
Insurance-in-force (IIF) ⁽¹⁾		210,183			207,538			203,501			199,373			197,029
Risk-in-force (RIF) ⁽¹⁾		56,113			55,253			53,956			52,610			51,796
Policies in force (count) ⁽¹⁾		659,567			654,374			645,276			635,662			629,690
Average loan size ($ value in thousands) ⁽¹⁾	$	319		$	317		$	315		$	314		$	313
Coverage percentage ⁽²⁾		26.7	%		26.6	%		26.5	%		26.4	%		26.3	%
Loans in default (count) ⁽¹⁾		6,642			5,712			4,904			5,109			5,099
Default rate ⁽¹⁾		1.01	%		0.87	%		0.76	%		0.80	%		0.81	%
Risk-in-force on defaulted loans ⁽¹⁾	$	545		$	468		$	401		$	414		$	408
Average net premium yield ⁽³⁾		0.27	%		0.28	%		0.28	%		0.28	%		0.27	%
Earnings from cancellations	$	0.8		$	0.8		$	1.0		$	0.6		$	1.0
Annual persistency ⁽⁴⁾		84.6	%		85.5	%		85.4	%		85.8	%		86.1	%
Quarterly run-off ⁽⁵⁾		4.5	%		4.0	%		4.2	%		3.6	%		3.4	%

(1) Reported as of the end of the period.
(2) Calculated as end of period RIF divided by end of period IIF.
(3) Calculated as net premiums earned, divided by average primary IIF for the period, annualized.
(4) Defined as the percentage of IIF that remains on our books after a given twelve-month period.
(5) Defined as the percentage of IIF that is no longer on our books after a given three-month period.

NIW, IIF and Premiums

The tables below present primary NIW and primary IIF, as of the dates and for the periods indicated.

Primary NIW	For the three months ended
	December 31, 2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023
	(In Millions)
Monthly	$	11,688	$	11,978	$	12,288	$	9,175	$	8,614
Single		237		240		215		223		313
Total	$	11,925	$	12,218	$	12,503	$	9,398	$	8,927

Primary IIF	As of
	December 31, 2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023
	(In Millions)
Monthly	$	192,228	$	189,241	$	184,862	$	180,343	$	177,764
Single		17,955		18,297		18,639		19,030		19,265
Total	$	210,183	$	207,538	$	203,501	$	199,373	$	197,029

The following table presents the amounts related to the company’s quota-share reinsurance transactions (the 2016 QSR Transaction, 2018 QSR Transaction, 2020 QSR Transaction, 2021 QSR Transaction, 2022 QSR Transaction, 2022 Seasoned QSR Transaction, 2023 QSR Transaction, and 2024 QSR Transaction and collectively, the QSR Transactions), insurance-linked note transactions (the 2021-1 ILN Transaction, and 2021-2 ILN Transaction and collectively, the ILN Transactions), and traditional reinsurance transactions (the 2022-1 XOL Transaction, 2022-2 XOL Transaction, 2022-3 XOL Transaction, 2023-1 XOL Transaction, 2023-2 XOL Transaction, and 2024 XOL Transaction and collectively, the XOL Transactions) for the periods indicated.

	For the three months ended
	December 31, 2024			September 30, 2024			June 30, 2024			March 31, 2024			December 31, 2023
	(In Thousands)
The QSR Transactions
Ceded risk-in-force	$	13,024,200		$	12,968,039		$	12,815,434		$	12,669,207		$	12,626,541
Ceded premiums earned		(41,596	)		(41,761	)		(41,555	)		(41,269	)		(41,218	)
Ceded claims and claim expenses (benefits)		4,075			2,449			(138	)		659			2,447
Ceding commission earned		9,997			10,152			10,222			10,292			9,561
Profit commission		20,149			21,883			24,351			23,407			22,057

The ILN Transactions ⁽¹⁾
Ceded premiums	$	(4,217	)	$	(4,302	)	$	(5,858	)	$	(5,976	)	$	(6,305	)

The XOL Transactions
Ceded premiums	$	(9,969	)	$	(9,760	)	$	(9,403	)	$	(9,223	)	$	(8,302	)

(1) Effective July 25, 2024 and December 27, 2024, NMIC exercised its optional termination rights to terminate and commute its previously outstanding excess-of-loss reinsurance agreements with Oaktown Re III Ltd. and Oaktown Re V Ltd., respectively. In connection with the terminations and commutations, the insurance-linked notes issued by Oaktown Re III Ltd. and Oaktown Re V Ltd. were redeemed in full with a distribution of remaining collateral assets.

The tables below present our total primary NIW by FICO, loan-to-value (LTV) ratio, and purchase/refinance mix for the periods indicated.

Primary NIW by FICO	For the three months ended						For the year ended
	December 31, 2024		September 30, 2024		December 31, 2023		December 31, 2024		December 31, 2023
	(In Millions)
>= 760	$	6,508	$	6,615	$	4,564	$	24,808	$	22,995
740-759		2,090		2,057		1,542		8,098		6,769
720-739		1,621		1,529		1,280		5,907		5,484
700-719		890		1,040		816		3,794		2,816
680-699		575		652		568		2,392		1,946
<=679		241		325		157		1,045		463
Total	$	11,925	$	12,218	$	8,927	$	46,044	$	40,473
Weighted average FICO		758		757		755		757		760

Primary NIW by LTV	For the three months ended									For the year ended
	December 31, 2024			September 30, 2024			December 31, 2023			December 31, 2024			December 31, 2023
	(In Millions)
95.01% and above	$	1,510		$	1,568		$	990		$	5,908		$	3,713
90.01% to 95.00%		5,370			5,720			4,107			21,149			18,929
85.01% to 90.00%		3,740			3,584			2,947			13,994			13,597
85.00% and below		1,305			1,346			883			4,993			4,234
Total	$	11,925		$	12,218		$	8,927		$	46,044		$	40,473
Weighted average LTV		92.1	%		92.3	%		92.2	%		92.3	%		92.1	%

Primary NIW by purchase/refinance mix	For the three months ended						For the year ended
	December 31, 2024		September 30, 2024		December 31, 2023		December 31, 2024		December 31, 2023
	(In Millions)
Purchase	$	10,799	$	11,708	$	8,759	$	43,921	$	39,629
Refinance		1,126		510		168		2,123		844
Total	$	11,925	$	12,218	$	8,927	$	46,044	$	40,473

The table below presents a summary of our primary IIF and RIF by book year as of December 31, 2024.

Primary IIF and RIF	As of December 31, 2024
	IIF		RIF
Book Year	(In Millions)
2024	$	43,560	$	11,552
2023		34,284		9,047
2022		47,598		12,703
2021		50,699		13,634
2020		21,145		5,795
2019 and before		12,897		3,382
Total	$	210,183	$	56,113

The tables below present our total primary IIF and RIF by FICO and LTV, and total primary RIF by loan type as of the dates indicated.

Primary IIF by FICO	As of
	December 31, 2024		September 30, 2024		December 31, 2023
	(In Millions)
>= 760	$	105,315	$	103,764	$	98,034
740-759		37,321		36,830		34,829
720-739		29,343		28,930		27,755
700-719		19,766		19,654		18,734
680-699		13,374		13,326		12,867
<=679		5,064		5,034		4,810
Total	$	210,183	$	207,538	$	197,029

Primary RIF by FICO	As of
	December 31, 2024		September 30, 2024		December 31, 2023
	(In Millions)
>= 760	$	27,883	$	27,396	$	25,523
740-759		10,006		9,850		9,207
720-739		7,926		7,788		7,387
700-719		5,383		5,337		5,021
680-699		3,615		3,590		3,433
<=679		1,300		1,292		1,225
Total	$	56,113	$	55,253	$	51,796

Primary IIF by LTV	As of
	December 31, 2024		September 30, 2024		December 31, 2023
	(In Millions)
95.01% and above	$	23,555	$	22,644	$	19,609
90.01% to 95.00%		103,472		101,872		95,415
85.01% to 90.00%		64,290		63,568		60,348
85.00% and below		18,866		19,454		21,657
Total	$	210,183	$	207,538	$	197,029

Primary RIF by LTV	As of
	December 31, 2024		September 30, 2024		December 31, 2023
	(In Millions)
95.01% and above	$	7,345	$	7,054	$	6,062
90.01% to 95.00%		30,563		30,100		28,184
85.01% to 90.00%		15,956		15,777		14,961
85.00% and below		2,249		2,322		2,589
Total	$	56,113	$	55,253	$	51,796

Primary RIF by Loan Type	As of
	December 31, 2024		September 30, 2024		December 31, 2023

Fixed	98	%	98	%	98	%
Adjustable rate mortgages:
Less than five years	—		—		—
Five years and longer	2		2		2
Total	100	%	100	%	100	%

The table below presents a summary of the change in total primary IIF during the periods indicated.

Primary IIF	As of and for the three months ended
	December 31, 2024			September 30, 2024			December 31, 2023
	(In Millions)
IIF, beginning of period	$	207,538		$	203,501		$	194,781
NIW		11,925			12,218			8,927
Cancellations, principal repayments and other reductions		(9,280	)		(8,181	)		(6,679	)
IIF, end of period	$	210,183		$	207,538		$	197,029

Geographic Dispersion

The following table shows the distribution by state of our primary RIF as of the periods indicated:

Top 10 primary RIF by state	As of
	December 31, 2024		September 30, 2024		December 31, 2023
California	10.1	%	10.1	%	10.2	%
Texas	8.6		8.7		8.7
Florida	7.3		7.4		7.6
Georgia	4.1		4.1		4.1
Washington	3.9		3.9		4.0
Illinois	3.8		3.9		4.0
Virginia	3.7		3.8		3.9
Pennsylvania	3.4		3.4		3.4
Ohio	3.3		3.2		3.0
North Carolina	3.2		3.1		3.0
Total	51.4	%	51.6	%	51.9	%

The table below presents selected primary portfolio statistics, by book year, as of December 31, 2024.

	As of December 31, 2024
Book year	Original Insurance Written		Remaining Insurance in Force		% Remaining of Original Insurance		Policies Ever in Force	Number of Policies in Force	Number of Loans in Default	# of Claims Paid	Incurred Loss Ratio (Inception to Date)⁽¹⁾		Cumulative Default Rate⁽²⁾		Current Default Rate⁽³⁾
	($ Values in Millions)
2015 and prior	$	16,035	$	885	6	%	67,989	4,903	99	208	2.7	%	0.5	%	2.0	%
2016		21,187		1,498	7	%	83,626	8,076	158	187	1.7	%	0.4	%	2.0	%
2017		21,582		1,867	9	%	85,897	10,577	267	184	1.9	%	0.5	%	2.5	%
2018		27,295		2,433	9	%	104,043	13,152	420	184	2.5	%	0.6	%	3.2	%
2019		45,141		6,214	14	%	148,423	27,442	511	97	2.0	%	0.4	%	1.9	%
2020		62,702		21,145	34	%	186,174	73,926	598	51	1.4	%	0.3	%	0.8	%
2021		85,574		50,699	59	%	257,972	167,892	1,679	74	3.5	%	0.7	%	1.0	%
2022		58,734		47,598	81	%	163,281	138,915	2,002	68	17.9	%	1.3	%	1.4	%
2023		40,473		34,284	85	%	111,994	98,711	725	10	14.4	%	0.7	%	0.7	%
2024		46,044		43,560	95	%	120,747	115,973	183	—	6.2	%	0.2	%	0.2	%
Total	$	424,767	$	210,183			1,330,146	659,567	6,642	1,063

(1) Calculated as total claims incurred (paid and reserved) divided by cumulative premiums earned, net of reinsurance.
(2) Calculated as the sum of the number of claims paid ever to date and number of loans in default divided by policies ever in force.
(3) Calculated as the number of loans in default divided by number of policies in force.

The following table provides a reconciliation of the beginning and ending reserve balances for primary insurance claims and claim expenses:

	For the three months ended December 31,						For the year ended December 31,
		2024			2023			2024			2023
	(In Thousands)
Beginning balance	$	135,520		$	116,078		$	123,974		$	99,836
Less reinsurance recoverables ⁽¹⁾		(29,214	)		(25,956	)		(27,514	)		(21,587	)
Beginning balance, net of reinsurance recoverables		106,306			90,122			96,460			78,249

Add claims incurred:
Claims and claim expenses incurred:
Current year ⁽²⁾		21,674			17,298			93,206			78,285
Prior years ⁽³⁾		(4,421	)		(9,789	)		(61,662	)		(56,390	)
Total claims and claim expenses incurred ⁽⁴⁾		17,253			7,509			31,544			21,895

Less claims paid:
Claims and claim expenses paid:
Current year ⁽²⁾		458			481			638			600
Prior years ⁽³⁾		3,290			1,181			7,555			3,575
Reinsurance terminations		—			(491	)		—			(491	)
Total claims and claim expenses paid		3,748			1,171			8,193			3,684

Reserve at end of period, net of reinsurance recoverables		119,811			96,460			119,811			96,460
Add reinsurance recoverables ⁽¹⁾		32,260			27,514			32,260			27,514
Ending balance	$	152,071		$	123,974		$	152,071		$	123,974

(1) Related to ceded losses recoverable under the QSR Transactions
(2) Related to insured loans with their most recent defaults occurring in the current year. For example, if a loan defaulted in a prior year and subsequently cured and later re-defaulted in the current year, the default would be included in the current year. Amounts are presented net of reinsurance and included $83.5 million attributed to net case reserves and $8.1 million attributed to net IBNR reserves for the year ended December 31, 2024, $70.6 million attributed to net case reserves and $6.3 million attributed to net IBNR reserves for the year ended December 31, 2023.
(3) Related to insured loans with defaults occurring in prior years, which have been continuously in default before the start of the current year. Amounts are presented net of reinsurance and included $54.1 million attributed to net case reserves and $6.3 million attributed to net IBNR reserves for the year ended December 31, 2024, $50.9 million attributed to net case reserves and $4.5 million attributed to net IBNR reserves for the year ended December 31, 2023.
(4) Excludes a $0.7 million termination fee for the year ended December 31, 2023 incurred in connection with the amendment of the 2020 QSR Transaction.

The following table provides a reconciliation of the beginning and ending count of loans in default:

	For the three months ended December 31,				For the year ended December 31,
	2024		2023		2024		2023
Beginning default inventory	5,712		4,594		5,099		4,449
Plus: new defaults	2,742		2,039		8,757		6,758
Less: cures	(1,684	)	(1,458	)	(6,899	)	(5,892	)
Less: claims paid	(108	)	(70	)	(276	)	(199	)
Less: rescission and claims denied	(20	)	(6	)	(39	)	(17	)
Ending default inventory	6,642		5,099		6,642		5,099

The following table provides details of our claims paid, before giving effect to claims ceded under the QSR Transactions, for the periods indicated:

	For the three months ended December 31,						For the year ended December 31,
		2024			2023			2024			2023
	($ Values In Thousands)
Number of claims paid ⁽¹⁾		108			70			276			199
Total amount paid for claims	$	4,777		$	2,060		$	10,491		$	5,192
Average amount paid per claim	$	44		$	29		$	38		$	26
Severity ⁽²⁾		65	%		64	%		61	%		55	%

(1) Count includes 32 and 88 claims settled without payment during the three months and year ended December 31, 2024, respectively, and 23 and 70 claims settled without payment during the three months and year ended December 31, 2023, respectively.
(2) Severity represents the total amount of claims paid including claim expenses divided by the related RIF on the loan at the time the claim is perfected, and is calculated including claims settled without payment.

The following table shows our average reserve per default, before giving effect to reserves ceded under the QSR Transactions, as of the dates indicated:

Average reserve per default:	As of
	December 31, 2024		December 31, 2023
	(In Thousands)
Case ⁽¹⁾	$	21.0	$	22.4
IBNR ^{(1) (2)}		1.9		1.9
Total	$	22.9	$	24.3

(1) Defined as the gross reserve per insured loan in default.
(2) Amount includes claims adjustment expenses.

The following table provides a comparison of the PMIERs available assets and net risk-based required asset amount as reported by NMIC as of the dates indicated:

	As of
	December 31, 2024		September 30, 2024		December 31, 2023
	(In Thousands)
Available assets	$	3,108,211	$	3,006,892	$	2,717,804
Net risk-based required assets		1,828,807		1,735,790		1,516,140

The MIL Network –

February 7, 2025

MIL-OSI: Monolithic Power Systems Earnings Commentary for the Quarter and Year Ended December 31, 2024

Source: GlobeNewswire (MIL-OSI)

KIRKLAND, Wash., Feb. 06, 2025 (GLOBE NEWSWIRE) — MPS will report its results after the market closes on February 6, 2025 and host a question-and-answer webinar at 2:00 p.m. PT / 5:00 p.m. ET. The live event will be held via a Zoom webcast, which can be accessed at https://mpsic.zoom.us/j/96816578886.

2024 Financial Summary	(Unaudited)
GAAP

		2024			2023		YoY Change	YoY Change (%)
Revenue ($k)	$	2,207,100		$	1,821,072		Up $ 386,028	Up 21.2%
Gross Margin		55.3	%		56.1	%	Down 0.8 pts	Down 1.4%
Opex ($k)	$	681,512		$	539,383		Up $ 142,129	Up 26.4%
Operating Margin		24.4	%		26.5	%	Down 2.1 pts	Down 7.9%
Net income ($k)	$	1,786,700		$	427,374		Up $ 1,359,326	Up 318.1%
Diluted EPS	$	36.59		$	8.76		Up $ 27.83	Up 317.7%

		2024			2023		YoY Change	YoY Change (%)
Revenue ($k)	$	2,207,100		$	1,821,072		Up $ 386,028	Up 21.2%
Gross Margin		55.8	%		56.4	%	Down 0.6 pts	Down 1.1%
Opex ($k)	$	466,379		$	385,395		Up $ 80,984	Up 21.0%
Operating Margin		34.6	%		35.2	%	Down 0.6 pts	Down 1.7%
Net income ($k)	$	689,755		$	574,647		Up $ 115,108	Up 20.0%
Diluted EPS	$	14.12		$	11.78		Up $ 2.34	Up 19.9%

Revenue by End Market

	Revenue					YoY Change					% of Total Rev
End Market ($M)		2024			2023		$		%		2024		2023
Enterprise Data	$	716.2	$	323.0		$	393.2		121.7	%	32.5	%	17.7	%
Storage & Computing		501.6		491.1			10.5		2.1	%	22.7		27.0
Automotive		414.0		394.7			19.3		4.9	%	18.8		21.7
Communications		225.9		204.9			21.0		10.2	%	10.2		11.3
Consumer		202.0		234.7			(32.7	)	(13.9	%)	9.1		12.9
Industrial		147.4		172.7			(25.3	)	(14.6	%)	6.7		9.4
Total	$	2,207.1	$	1,821.1		$	386.0		21.2	%	100	%	100	%

Q4 2024 Financial Summary	(Unaudited)
GAAP

		Q4’24			Q3’24			Q4’23		QoQ Change	YoY Change
Revenue ($k)	$	621,665		$	620,119		$	454,012		Up 0.2%	Up 36.9%
Gross Margin		55.4	%		55.4	%		55.3	%	Flat	Up 0.1 pts
Opex ($k)	$	181,101		$	179,415		$	141,554		Up 0.9%	Up 27.9%
Operating Margin		26.3	%		26.5	%		24.1	%	Down 0.2 pts	Up 2.2 pts
Net income ($k)	$	1,449,363		$	144,430		$	96,905		Up 903.5%	Up 1395.7%
Diluted EPS	$	29.88		$	2.95		$	1.98		Up 912.9%	Up 1409.1%

	Q4’24				Q3’24			Q4’23		QoQ Change	YoY Change
Revenue ($k)	$	621,665		$	620,119		$	454,012		Up 0.2%	Up 36.9%
Gross Margin		55.8	%		55.8	%		55.7	%	Flat	Up 0.1 pts
Opex ($k)	$	126,117		$	125,169		$	96,745		Up 0.8%	Up 30.4%
Operating Margin		35.5	%		35.6	%		34.4	%	Down 0.1 pts	Up 1.1 pts
Net income ($k)	$	198,401		$	198,786		$	140,852		Down 0.2%	Up 40.9%
Diluted EPS	$	4.09		$	4.06		$	2.88		Up 0.7%	Up 42.0%

Revenue by End Market

	Revenue					YoY Change				% of Total Rev
End Market ($M)		Q4’24			Q4’23	$			%	Q4’24		Q4’23
Enterprise Data	$	194.9	$	128.9		$	66.0	51.2	%	31.3	%	28.4	%
Storage & Computing		136.5		117.3			19.2	16.4	%	22.0		25.8
Automotive		128.4		89.8			38.6	43.0	%	20.6		19.8
Communications		63.8		40.9			22.9	55.9	%	10.3		9.0
Consumer		57.3		43.7			13.6	31.0	%	9.2		9.6
Industrial		40.8		33.4			7.4	22.3	%	6.6		7.4
Total	$	621.7	$	454.0		$	167.7	36.9	%	100	%	100	%

Ongoing Business Conditions

In 2024, MPS’s revenue grew 21.2% year-over-year and achieved record revenue of $2.2 billion. This is our 13th consecutive year of revenue growth driven by consistent execution, continued innovation, and strong customer focus.

Highlights from 2024 include:

We introduced a Silicon Carbide inverter for high power clean energy applications. Initial revenue is expected to ramp in late 2025. Other Silicon Carbide-based applications are expected to be introduced in multiple geographies during 2025 and 2026.
We developed a family of high quality, cost efficient automotive audio products utilizing DSP technology from our 2024 Axign acquisition powered by MPS solutions.
For enterprise notebooks, we launched a battery management solution and are sampling our new mini-phase power stage. These products enable faster charge time and significantly improve notebook battery life.
Building on our first analog to digital converter design win in 2024, we are developing new high accuracy 24-bit converters which are expected to ramp in the second half of 2025.
We executed a $640M stock repurchase program offsetting dilution for our shareholders.

In Q4 2024, MPS achieved record quarterly revenue of $621.7 million, slightly higher than revenue in the third quarter of 2024 and 36.9% higher than revenue in the fourth quarter of 2023. Our performance during the quarter reflected the continued strength of our diversified market strategy and a continued trend of the improved ordering patterns we saw in Q3 2024.

MPS continues to focus on innovation, solving our customers’ most challenging problems, and maintaining the highest level of quality. We continue to invest in new technology, expand into new markets, and to diversify our end-market applications and global supply chain. This will allow us to capture future growth opportunities, maintain supply stability, and swiftly adapt to market changes as they occur.

“Our proven, long-term growth strategy remains intact as we continue our transformation from being a chip-only, semiconductor supplier to a full service, silicon-based solutions provider,” said Michael Hsing, CEO and founder of MPS.

2024 Full Year Revenue Results

Our full year 2024 revenue by market segment was as follows:

Full year 2024 Enterprise Data revenue grew $393.2 million to $716.2 million. This 121.7% increase was due to higher sales of our power management solutions for AI and server applications. Enterprise Data revenue represented 32.5% of MPS’s total revenue in 2024 compared with 17.7% in 2023.

Communications revenue grew by $21.0 million in 2024 to $225.9 million. This 10.2% increase was a result of higher sales of power solutions for optical modules and routers, partially offset by lower sales of networking solutions. Communications revenue represented 10.2% of our 2024 revenue compared with 11.3% in 2023.

Automotive revenue grew $19.3 million year-over-year to $414.0 million in 2024. This 4.9% gain was driven by increased sales of our highly integrated applications supporting advanced driver assistance systems. Automotive revenue represented 18.8% of MPS’s full year 2024 revenue compared with 21.7% in 2023.

Storage and Computing revenue for 2024 grew $10.5 million over the prior year to $501.6 million. This 2.1% increase was primarily driven by increased sales of products for notebooks. Storage and Computing revenue represented 22.7% of MPS’s total revenue in 2024 compared with 27.0% in 2023.

Consumer revenue decreased $32.7 million to $202.0 million in 2024. This 13.9% year-over-year decrease was a result of broad market weakness. Consumer revenue represented 9.1% of MPS’s full year 2024 revenue compared with 12.9% in 2023.

Industrial revenue fell by $25.3 million to $147.4 million in 2024. This 14.6% decrease was due to general market weakness across all industrial segments. Industrial revenue represented 6.7% of MPS’s full year 2024 revenue compared with 9.4% in 2023.

Q4’24 Revenue Results

MPS reported fourth quarter revenue of $621.7 million, slightly higher than the third quarter of 2024 and 36.9% higher than the fourth quarter of 2023. Compared with the third quarter of 2024, sales in Automotive and Enterprise Data improved sequentially.

Fourth quarter Automotive revenue of $128.4 million increased 15.3% from the third quarter of 2024 primarily from higher sales in ADAS and infotainment power solutions. Fourth quarter 2024 Automotive revenue was up 43.0% year over year. Automotive revenue represented 20.6% of MPS’s fourth quarter 2024 revenue compared with 19.8% in the fourth quarter of 2023.

In our Enterprise Data market, fourth quarter 2024 revenue of $194.9 million increased 5.6% from the third quarter of 2024. Fourth quarter 2024 Enterprise Data revenue was up 51.2% year over year. Enterprise Data revenue represented 31.3% of MPS’s fourth quarter 2024 revenue compared with 28.4% in the fourth quarter of 2023.

Fourth quarter 2024 Storage and Computing revenue of $136.5 million decreased 5.2% from the third quarter of 2024. The sequential decrease was primarily driven by lower sales in notebooks, partially offset by stronger sales in graphic cards. Fourth quarter 2024 Storage and Computing revenue was up 16.4% year over year. Storage and Computing revenue represented 22.0% of MPS’s fourth quarter 2024 revenue compared with 25.8% in the fourth quarter of 2023.

Fourth quarter 2024 Industrial revenue of $40.8 million decreased 7.3% from the third quarter of 2024 due to lower sales for security and power sources. Fourth quarter 2024 Industrial revenue was up 22.3% year over year. Industrial revenue represented 6.6% of our total fourth quarter 2024 revenue compared with 7.4% in the fourth quarter of 2023.

Fourth quarter Consumer revenue of $57.3 million decreased 11.0% from the third quarter of 2024 primarily from lower sales in smart TVs, home appliance and gaming solutions. Fourth quarter 2024 Consumer revenue was up 31.0% year over year. Consumer revenue represented 9.2% of MPS’s fourth quarter 2024 revenue compared with 9.6% in the fourth quarter of 2023.

Fourth quarter 2024 Communications revenue of $63.8 million was down 11.2% from the third quarter of 2024 reflecting lower sales in networking solutions, partially offset by higher sales in optical solutions. Fourth quarter 2024 Communications revenue was up 55.9% year over year. Communications sales represented 10.3% of our total fourth quarter 2024 revenue compared with 9.0% in the fourth quarter of 2023.

Q4’24 Gross Margin & Operating Income

GAAP gross margin was 55.4%, flat to the third quarter of 2024. Our GAAP operating income was approximately $163.3 million compared to $164.0 million reported in the third quarter of 2024.

Non-GAAP gross margin for the fourth quarter of 2024 was 55.8%, flat to the third quarter of 2024. Our non-GAAP operating income was $220.7 million compared to $220.8 million reported in the third quarter of 2024.

Q4’24 Operating Expenses

Our GAAP operating expenses were $181.1 million in the fourth quarter of 2024 compared with $179.4 million in the third quarter of 2024.

Our Non-GAAP operating expenses were approximately $126.1 million, up from $125.2 million in the third quarter of 2024.

The differences between non-GAAP operating expenses and GAAP operating expenses for the quarters discussed here are primarily stock-based compensation and related expense and deferred compensation plan expense.

Total stock-based compensation and related expenses, including approximately $1.7 million charged to cost of goods sold, was $56.3 million compared with $52.4 million recorded in the third quarter of 2024.

The Bottom Line

Fourth quarter 2024 GAAP net income was $1.4 billion or $29.88 per fully diluted share, compared with $144.4 million or $2.95 per share in the third quarter of 2024. Fourth quarter GAAP net income and EPS included the recognition of a tax benefit granted to a foreign subsidiary.

Fourth quarter 2024 non-GAAP net income was $198.4 million or $4.09 per fully diluted share, compared with $198.8 million or $4.06 per fully diluted share in the third quarter of 2024.

There were 48.5 million fully diluted shares outstanding at the end of the fourth quarter of 2024. MPS repurchased $622M in stock during the fourth quarter of 2024.

Balance Sheet and Cash Flow

Cash, cash equivalents and short-term investments were $862.9 million at the end of the fourth quarter of 2024 compared to $1.46 billion at the end of the third quarter of 2024. The change was driven primarily by the share repurchases made in the fourth quarter. For the fourth quarter of 2024, MPS generated operating cash flow of approximately $167.7 million compared with the third quarter of 2024 operating cash flow of $231.7 million.

Accounts receivable at the end of the fourth quarter of 2024 at $172.5 million, representing 25 days of sales outstanding, which was 1 day higher than the 24 days reported at the end of the third quarter of 2024.

Our internal inventories at the end of the fourth quarter of 2024 were $419.6 million, down from $424.9 million at the end of the third quarter of 2024. Days of inventory of 138 days at the end of the fourth quarter of 2024 was 2 days lower than at the end of the third quarter of 2024.

We have carefully managed our internal inventories throughout the year, balancing the uncertainty in the market with being prepared to capture market upturns when they occur. Comparing current inventory levels using next quarter’s projected revenue, days of inventory at the end of the fourth quarter of 138 days was 2 days lower than at the end of the third quarter of 2024.

Selected Balance Sheet and Inventory Data				(Unaudited)

	Q4’24	Q3’24	Q4’23
Cash, Cash Equivalents, and Short-Term Investments	$ 862.9 M	$ 1,462.4 M	$ 1,108.5 M
Operating Cash Flow	$ 167.7 M	$ 231.7 M	$ 153.3 M
Accounts Receivable	$ 172.5 M	$ 164.7 M	$ 179.9 M
Days of Sales Outstanding	25 Days	24 Days	36 Days
Internal Inventories	$ 419.6 M	$ 424.9 M	$ 383.7 M
Days of Inventory (current quarter revenue)	138 Days	140 Days	172 Days
Days of Inventory (next quarter revenue)	138 Days	140 Days	170 Days

Q1’25 Business Outlook

For the first quarter of 2025 ending March 31, we are forecasting:

Revenue in the range of $610 million to $630 million.
GAAP gross margin in the range of 55.1% to 55.7%.
Non-GAAP gross margin in the range of 55.4% to 56.0%, which excludes the impact from stock-based compensation and related expenses as well as the impact from amortization of acquisition-related intangible assets.
Total stock-based compensation and related expenses in the range of $55.0 million to $57.0 million including approximately $1.7 million that would be charged to cost of goods sold.
GAAP operating expenses between $180.2 million and $186.2 million.
Non-GAAP operating expenses in the range of $126.9 million to $130.9 million. This estimate excludes stock-based compensation and related expenses in the range of $53.3 million to $55.3 million.
Interest and other income in the range from $5.8 million to $6.2 million before foreign exchange gains or losses.
Non-GAAP tax rate of 15% for 2025.
Fully diluted shares outstanding in the range of 47.8 to 48.2 million shares.

Our quarterly dividend will increase 25% to $1.56 per share from $1.25 per share for stockholders of record as of March 31, 2025.

In addition, our board of directors has authorized a new $500 million stock repurchase program effective over the next 3 years. The $640 million share repurchase program authorized in October of 2023 has been fully executed.

For further information, contact:

Bernie Blegen
Executive Vice President and Chief Financial Officer
Monolithic Power Systems, Inc.
408-826-0777
MPSInvestor.Relations@monolithicpower.com

Safe Harbor Statement

This earnings commentary contains, and statements that will be made during the accompanying webinar will contain, forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995, including under the “Q1’25 Business Outlook” section herein, our statement regarding our business focus, our statement regarding the expansion and diversification of our global supply chain and the quote from our CEO and founder, including, among other things, (i) projected revenue, GAAP and non-GAAP gross margin, GAAP and non-GAAP operating expenses, stock-based compensation and related expenses, amortization of acquisition-related intangible assets, other income before foreign exchange gains or losses, and fully diluted shares outstanding, (ii) our outlook for the first quarter of fiscal year 2025 and the near-term, medium-term and long-term prospects of MPS, including our ability to adapt to changing market conditions, performance against our business plan, our ability to grow despite the various challenges facing our business, our industry and the global economic environment, revenue growth in certain of our market segments, potential new business segments, our continued investment in research and development (“R&D”), expected revenue growth, customers’ acceptance of our new product offerings, the prospects of our new product development, our expectations regarding market and industry segment trends and prospects, and our projected expansion of capacity and the impact it may have on our business, (iii) our ability to penetrate new markets and expand our market share, (iv) the seasonality of our business, (v) our ability to reduce our expenses, and (vi) statements regarding the assumptions underlying or relating to any statement described in (i), (ii), (iii), (iv), or (v). These forward-looking statements are not historical facts or guarantees of future performance or events, are based on current expectations, estimates, beliefs, assumptions, goals, and objectives, and involve significant known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from the results expressed by these statements. Readers of this earnings commentary and listeners to the accompanying conference call are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date hereof. Factors that could cause actual results to differ include, but are not limited to, continued uncertainties in the global economy, including due to the Russia-Ukraine and Middle East conflicts, inflation, consumer sentiment and other factors; adverse events arising from orders or regulations of governmental entities, including such orders or regulations that impact our customers or suppliers, and adoption of new or amended accounting standards; adverse changes in laws and government regulations such as tariffs on imports of foreign goods, export regulations and export classifications, and tax laws or the interpretation of same, including in foreign countries where MPS has offices or operations; the effect of export controls, trade and economic sanctions regulations and other regulatory or contractual limitations on our ability to sell or develop our products in certain foreign markets, particularly in China; our ability to obtain governmental licenses and approvals for international trading activities or technology transfers, including export licenses; acceptance of, or demand for, our products, in particular the new products launched recently, being different than expected; our ability to increase market share in our targeted markets; difficulty in predicting or budgeting for future customer demand and channel inventories, expenses and financial contingencies (including as a result of any continuing impact from the Russia-Ukraine and Middle East conflicts); our ability to efficiently and effectively develop new products and receive a return on our R&D expense investment; our ability to attract new customers and retain existing customers; our ability to meet customer demand for our products due to constraints on our third-party suppliers’ ability to manufacture sufficient quantities of our products or otherwise; our ability to expand manufacturing capacity to support future growth; adverse changes in production and testing efficiency of our products; any political, cultural, military, regulatory, economic, foreign exchange and operational changes in China, where a significant portion of our manufacturing capacity comes from; any market disruptions or interruptions in our schedule of new product development releases; our ability to manage our inventory levels; adequate supply of our products from our third-party manufacturing partners; adverse changes or developments in the semiconductor industry generally, which is cyclical in nature, and our ability to adjust our operations to address such changes or developments; the ongoing consolidation of companies in the semiconductor industry; competition generally and the increasingly competitive nature of our industry; our ability to realize the anticipated benefits of companies and products that MPS acquires, and our ability to effectively and efficiently integrate these acquired companies and products into our operations; the risks, uncertainties and costs of litigation in which MPS is involved; the outcome of any upcoming trials, hearings, motions and appeals; the adverse impact on our financial performance if its tax and litigation provisions are inadequate; our ability to effectively manage our growth and attract and retain qualified personnel; the effect of epidemics and pandemics on the global economy and on our business; the risks associated with the financial market, economy and geopolitical uncertainties, including the Russia-Ukraine and Middle East conflicts; and other important risk factors identified under the caption “Risk Factors” and elsewhere in our Securities and Exchange Commission (“SEC”) filings, including, but not limited to, our Annual Report on Form 10-K filed with the SEC on February 29, 2024. MPS assumes no obligation to update the information in this earnings commentary or in the accompanying webinar.

Non-GAAP Financial Measures

This CFO Commentary contains references to certain non-GAAP financial measures. Non-GAAP net income, non-GAAP net income per share, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP other income, net, non-GAAP operating income and non-GAAP income before income taxes differ from net income, net income per share, gross margin, operating expenses, other income, net, operating income and income before income taxes determined in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). Non-GAAP net income and non-GAAP net income per share exclude the effect of stock-based compensation and related expenses, which include stock-based compensation expense and employer payroll taxes in relation to the stock-based compensation, net deferred compensation plan expense, amortization of acquisition-related intangible assets and related tax effects. Non-GAAP net income and non-GAAP net income per share also exclude the recognition of a tax benefit granted to a foreign subsidiary. Non-GAAP gross margin excludes the effect of stock-based compensation and related expenses, amortization of acquisition-related intangible assets and deferred compensation plan expense. Non-GAAP operating expenses exclude the effect of stock-based compensation and related expenses, amortization of acquisition-related intangible assets and deferred compensation plan expense. Non-GAAP operating income excludes the effect of stock-based compensation and related expenses, amortization of acquisition-related intangible assets and deferred compensation plan expense. Non-GAAP other income, net excludes the effect of deferred compensation plan income. Non-GAAP income before income taxes excludes the effect of stock-based compensation and related expenses, amortization of acquisition-related intangible assets and net deferred compensation plan expense. Projected non-GAAP gross margin excludes the effect of stock-based compensation and related expenses, and amortization of acquisition-related intangible assets. Projected non-GAAP operating expenses exclude the effect of stock-based compensation and related expenses. These non-GAAP financial measures are not prepared in accordance with GAAP and should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. A schedule reconciling non-GAAP financial measures is included at the end of this press release. MPS utilizes both GAAP and non-GAAP financial measures to assess what it believes to be its core operating performance and to evaluate and manage its internal business and assist in making financial operating decisions. MPS believes that the inclusion of non-GAAP financial measures, together with GAAP measures, provides investors with an alternative presentation useful to investors’ understanding of MPS’s core operating results and trends. Additionally, MPS believes that the inclusion of non-GAAP measures, together with GAAP measures, provides investors with an additional dimension of comparability to similar companies. However, investors should be aware that non-GAAP financial measures utilized by other companies are not likely to be comparable in most cases to the non-GAAP financial measures used by MPS. See the GAAP to Non-GAAP reconciliations in the tables set forth below.

RECONCILIATION OF NET INCOME TO NON-GAAP NET INCOME

(Unaudited, in thousands, except per share amounts)

	Three Months Ended December 31,					Year Ended December 31,
	2024			2023		2024			2023
Net income	$	1,449,363		$	96,905	$	1,786,700		$	427,374

Adjustments to reconcile net income to non-GAAP net income:
Stock-based compensation and related expenses*		56,320			41,107		213,209			149,711
Amortization of acquisition-related intangible assets		320			33		1,303			132
Deferred compensation plan expense, net		573			288		867			1,055
Tax effect of non-GAAP adjustments		(22,773	)		2,519		(26,922	)		(3,625	)
Recognition of a tax benefit granted to a foreign subsidiary		(1,285,402	)		–		(1,285,402	)		–
Non-GAAP net income	$	198,401		$	140,852	$	689,755		$	574,647

Non-GAAP net income per share:
Basic	$	4.11		$	2.94	$	14.19		$	12.07
Diluted	$	4.09		$	2.88	$	14.12		$	11.78

Shares used in the calculation of non-GAAP net income per share:
Basic		48,317			47,936		48,599			47,610
Diluted		48,506			48,881		48,835			48,771

*Prior periods exclude stock-based compensation related employer payroll taxes from non-GAAP measures due to immateriality.

RECONCILIATION OF GROSS MARGIN TO NON-GAAP GROSS MARGIN

(Unaudited, in thousands)

	Three Months Ended December 31,						Year Ended December 31,
	2024			2023			2024			2023
Gross profit	$	344,408		$	251,123		$	1,220,870		$	1,021,119
Gross margin		55.4	%		55.3	%		55.3	%		56.1	%

Adjustments to reconcile gross profit to non-GAAP gross profit:
Stock-based compensation and related expenses*		1,745			1,228			6,975			4,545
Amortization of acquisition-related intangible assets		287			–			1,171			–
Deferred compensation plan expense		417			486			1,500			871
Non-GAAP gross profit	$	346,857		$	252,837		$	1,230,516		$	1,026,535
Non-GAAP gross margin		55.8	%		55.7	%		55.8	%		56.4	%

*Prior periods exclude stock-based compensation related employer payroll taxes from non-GAAP measures due to immateriality.

RECONCILIATION OF OPERATING EXPENSES TO NON-GAAP OPERATING EXPENSES

(Unaudited, in thousands)

	Three Months Ended December 31,						Year Ended December 31,
	2024			2023			2024			2023
Total operating expenses	$	181,101		$	141,554		$	681,512		$	539,383

Adjustments to reconcile total operating expenses to non-GAAP total operating expenses:
Stock-based compensation and related expenses*		(54,575	)		(39,879	)		(206,234	)		(145,166	)
Amortization of acquisition-related intangible assets		(33	)		(33	)		(132	)		(132	)
Deferred compensation plan expense		(376	)		(4,897	)		(8,767	)		(8,690	)
Non-GAAP operating expenses	$	126,117		$	96,745		$	466,379		$	385,395

*Prior periods exclude stock-based compensation related employer payroll taxes from non-GAAP measures due to immateriality.

RECONCILIATION OF OPERATING INCOME TO NON-GAAP OPERATING INCOME

(Unaudited, in thousands)

	Three Months Ended December 31,				Year Ended December 31,
	2024		2023		2024		2023
Total operating income	$	163,307	$	109,569	$	539,358	$	481,736

Adjustments to reconcile total operating income to non-GAAP total operating income:
Stock-based compensation and related expenses*		56,320		41,107		213,209		149,711
Amortization of acquisition-related intangible assets		320		33		1,303		132
Deferred compensation plan expense		793		5,383		10,267		9,561
Non-GAAP operating income	$	220,740	$	156,092	$	764,137	$	641,140

*Prior periods exclude stock-based compensation related employer payroll taxes from non-GAAP measures due to immateriality.

RECONCILIATION OF OTHER INCOME, NET, TO NON-GAAP OTHER INCOME, NET

(Unaudited, in thousands)

	Three Months Ended December 31,						Year Ended December 31,
	2024			2023			2024			2023
Total other income, net	$	6,224		$	9,976		$	33,554		$	24,105

Adjustments to reconcile other income, net to non-GAAP other income, net:
Deferred compensation plan income		(220	)		(5,095	)		(9,400	)		(8,506	)
Non-GAAP other income, net	$	6,004		$	4,881		$	24,154		$	15,599

RECONCILIATION OF INCOME BEFORE INCOME TAXES TO NON-GAAP INCOME BEFORE INCOME TAXES

(Unaudited, in thousands)

	Three Months Ended December 31,				Year Ended December 31,
	2024		2023		2024		2023
Total income before income taxes	$	169,531	$	119,545	$	572,912	$	505,841

Adjustments to reconcile income before income taxes to non-GAAP income before income taxes:
Stock-based compensation and related expenses*		56,320		41,107		213,209		149,711
Amortization of acquisition-related intangible assets		320		33		1,303		132
Deferred compensation plan expense, net		573		288		867		1,055
Non-GAAP income before income taxes	$	226,744	$	160,973	$	788,291	$	656,739

*Prior periods exclude stock-based compensation related employer payroll taxes from non-GAAP measures due to immateriality.

2025 FIRST QUARTER OUTLOOK

RECONCILIATION OF GROSS MARGIN TO NON-GAAP GROSS MARGIN

(Unaudited)

	Three Months Ending March 31, 2025
	Three Months Ending March 31, 2025
	Low			High
Gross margin		55.1	%		55.7	%
Adjustment to reconcile gross margin to non-GAAP gross margin:
Stock-based compensation and other expenses		0.3	%		0.3	%
Non-GAAP gross margin		55.4	%		56.0	%

RECONCILIATION OF OPERATING EXPENSES TO NON-GAAP OPERATING EXPENSES

(Unaudited, in thousands)

	Three Months Ending March 31, 2025
	Three Months Ending March 31, 2025
	Low			High
Operating expenses	$	180,200		$	186,200
Adjustments to reconcile operating expenses to non-GAAP operating expenses:
Stock-based compensation and other expenses		(53,300	)		(55,300	)
Non-GAAP operating expenses	$	126,900		$	130,900

The MIL Network –

February 7, 2025

MIL-OSI: Monolithic Power Systems Announces $500 Million Stock Repurchase Program

Source: GlobeNewswire (MIL-OSI)

KIRKLAND, Wash., Feb. 06, 2025 (GLOBE NEWSWIRE) — Monolithic Power Systems, Inc. (“MPS”) (Nasdaq: MPWR), a global company that provides high-performance, semiconductor-based power electronics solutions, today announced its Board of Directors has approved a new stock repurchase program that authorizes MPS to repurchase up to $500 million in the aggregate of its common stock, which will expire on February 4, 2028.

Shares of common stock repurchased under the program will be retired. As of December 31, 2024, MPS had cash, cash equivalents and short-term investments of $862.9 million, and 47.8 million shares of common stock outstanding.

Stock repurchases under the program may be made through open market repurchases, privately negotiated transactions or other structures in accordance with applicable state and federal securities laws, at times and in amounts as management deems appropriate. The timing and the number of any repurchased common stock will be determined by MPS’s management based on its evaluation of market conditions, legal requirements, share price, and other factors. Repurchases of common stock may be made under a Rule 10b5-1 plan. The repurchase program does not obligate MPS to purchase any particular number of shares and may be suspended, modified, or discontinued at any time without prior notice.

Safe Harbor Statement
This news release includes “forward-looking statements” intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995, including statements with respect to the intention to make purchases under the repurchase program. These forward-looking statements are based on MPS’s current expectations, estimates and projections about MPS’s business and industry, management’s beliefs, and certain assumptions made by us, all of which are subject to change. Forward-looking statements can often be identified by words such as “anticipates,” “expects,” “forecasts,” “intends,” “believes,” “plans,” “may,” “will,” or “continue,” and similar expressions and variations or negatives of these words. All such statements are subject to certain risks, assumptions and uncertainties, including the risk that MPS does not effect any or all of the repurchases under the repurchase program, the risk that repurchases are not made at favorable prices, the risk that the repurchase program is suspended or terminated, the risk that the intended benefits of the repurchase program are not realized and those risks described under the caption “Risk Factors” and elsewhere in MPS’s most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Qs, and in other documents that MPS files or furnishes with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially and adversely from those projected, and may affect MPS’s future operating results, financial position and cash flows. Accordingly, you are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date they are made. Except to the extent required by law, MPS does not undertake, and expressly disclaims, any duty or obligation to update publicly any forward-looking statement after the initial distribution of this release, whether as a result of new information, future events, changes in assumptions or otherwise.

About Monolithic Power Systems
Monolithic Power Systems, Inc. is a fabless global company that provides high-performance, semiconductor-based power electronics solutions. MPS’s mission is to reduce energy and material consumption to improve all aspects of quality of life and create a sustainable future. Founded in 1997 by our CEO Michael Hsing, MPS has three core strengths: deep system-level knowledge, strong semiconductor design expertise, and innovative proprietary technologies in the areas of semiconductor processes, system integration, and packaging. These combined advantages enable MPS to deliver reliable, compact, and monolithic solutions that are highly energy-efficient, cost-effective, and environmentally responsible while providing a consistent return on investment to our stockholders. MPS can be contacted through its website at www.monolithicpower.com or its support offices around the world.

Monolithic Power Systems, MPS, and the MPS logo are registered trademarks of Monolithic Power Systems, Inc. in the U.S. and trademarked in certain other countries.

Contact:
Bernie Blegen
Executive Vice President and Chief Financial Officer
Monolithic Power Systems, Inc.
408-826-0777
MPSInvestor.Relations@monolithicpower.com

The MIL Network –

February 7, 2025

MIL-OSI: Monolithic Power Systems Announces Results for the Fourth Quarter and Year Ended December 31, 2024 and an Increase in Quarterly Cash Dividend

Source: GlobeNewswire (MIL-OSI)

KIRKLAND, Wash., Feb. 06, 2025 (GLOBE NEWSWIRE) — Monolithic Power Systems, Inc. (“MPS”) (Nasdaq: MPWR), a fabless global company that provides high-performance, semiconductor-based power electronics solutions, today announced financial results for the quarter and year ended December 31, 2024. MPS also announced that its Board of Directors has approved an increase in the quarterly cash dividend from $1.25 per share to $1.56 per share. The first quarter dividend of $1.56 per share will be paid on April 15, 2025 to all stockholders of record as of the close of business on March 31, 2025.

The financial results for the quarter ended December 31, 2024 were as follows:

Revenue was $621.7 million for the quarter ended December 31, 2024, a 0.2% increase from $620.1 million for the quarter ended September 30, 2024 and a 36.9% increase from $454.0 million for the quarter ended December 31, 2023.

GAAP gross margin was 55.4% for the quarter ended December 31, 2024, compared with 55.3% for the quarter ended December 31, 2023.

Non-GAAP gross margin (1) was 55.8% for the quarter ended December 31, 2024, excluding the impact of $1.7 million for stock-based compensation and related expenses, $0.4 million for deferred compensation plan expense and $0.3 million for amortization of acquisition-related intangible assets, compared with 55.7% for the quarter ended December 31, 2023, excluding the impact of $1.2 million for stock-based compensation expense and $0.5 million for deferred compensation plan expense.

GAAP operating expenses were $181.1 million for the quarter ended December 31, 2024, compared with $141.6 million for the quarter ended December 31, 2023.

Non-GAAP operating expenses (1) were $126.1 million for the quarter ended December 31, 2024, excluding $54.6 million for stock-based compensation and related expenses, and $0.4 million for deferred compensation plan expense, compared with $96.7 million for the quarter ended December 31, 2023, excluding $39.9 million for stock-based compensation expense and $4.9 million for deferred compensation plan expense.

GAAP operating income was $163.3 million for the quarter ended December 31, 2024, compared with $109.6 million for the quarter ended December 31, 2023.

Non-GAAP operating income (1) was $220.7 million for the quarter ended December 31, 2024, excluding $56.3 million for stock-based compensation and related expenses, $0.8 million for deferred compensation plan expense and $0.3 million for amortization of acquisition-related intangible assets, compared with $156.1 million for the quarter ended December 31, 2023, excluding $41.1 million for stock-based compensation expense and $5.4 million for deferred compensation plan expense.

GAAP other income, net was $6.2 million for the quarter ended December 31, 2024, compared with $10.0 million for the quarter ended December 31, 2023.

Non-GAAP other income, net (1) was $6.0 million for the quarter ended December 31, 2024, excluding $0.2 million for deferred compensation plan income, compared with $4.9 million for the quarter ended December 31, 2023, excluding $5.1 million for deferred compensation plan income.

GAAP income before income taxes was $169.5 million for the quarter ended December 31, 2024, compared with $119.5 million for the quarter ended December 31, 2023.

Non-GAAP income before income taxes (1) was $226.7 million for the quarter ended December 31, 2024, excluding $56.3 million for stock-based compensation and related expenses, $0.6 million for net deferred compensation plan expense and $0.3 million for amortization of acquisition-related intangible assets, compared with $161.0 million for the quarter ended December 31, 2023, excluding $41.1 million for stock-based compensation expense and $0.3 million for net deferred compensation plan expense.

GAAP net income was $1.4 billion and $29.88 per diluted share for the quarter ended December 31, 2024. Comparatively, GAAP net income was $96.9 million and $1.98 per diluted share for the quarter ended December 31, 2023. GAAP net income and income per diluted share for the quarter ended December 31, 2024 included $1.3 billion for the recognition of a tax benefit granted to a foreign subsidiary.

Non-GAAP net income (1) was $198.4 million and $4.09 per diluted share for the quarter ended December 31, 2024 excluding $1.3 billion for the recognition of a tax benefit granted to a foreign subsidiary. Non-GAAP net income (1) for the quarter ended December 31, 2024 also excluded $56.3 million for stock-based compensation and related expenses, $0.6 million for net deferred compensation plan expense, $0.3 million for amortization of acquisition-related intangible assets and $22.8 million for the related tax effects, compared with $140.9 million and $2.88 per diluted share for the quarter ended December 31, 2023, excluding $41.1 million for stock-based compensation expense, $0.3 million for net deferred compensation plan expense and $2.5 million for the related tax effects.

The financial results for the year ended December 31, 2024 were as follows:

Revenue was $2.2 billion for the year ended December 31, 2024, a 21.2% increase from $1.8 billion for the year ended December 31, 2023.

GAAP gross margin was 55.3% for the year ended December 31, 2024, compared with 56.1% for the year ended December 31, 2023.

Non-GAAP gross margin (1) was 55.8% for the year ended December 31, 2024, excluding the impact of $7.0 million for stock-based compensation and related expenses, $1.5 million for deferred compensation plan expense and $1.2 million for amortization of acquisition-related intangible assets, compared with 56.4% for the year ended December 31, 2023, excluding the impact of $4.5 million for stock-based compensation expense and $0.9 million for deferred compensation plan expense.

GAAP operating expenses were $681.5 million for the year ended December 31, 2024, compared with $539.4 million for the year ended December 31, 2023.

Non-GAAP operating expenses (1) were $466.4 million for the year ended December 31, 2024, excluding $206.2 million for stock-based compensation and related expenses, $8.8 million for deferred compensation plan expense and $0.1 million for amortization of acquisition-related intangible assets, compared with $385.4 million for the year ended December 31, 2023, excluding $145.2 million for stock-based compensation expense, $8.7 million for deferred compensation plan expense and $0.1 million for amortization of acquisition-related intangible assets.

GAAP operating income was $539.4 million for the year ended December 31, 2024, compared with $481.7 million for the year ended December 31, 2023.

Non-GAAP operating income (1) was $764.1 million for the year ended December 31, 2024, excluding $213.2 million for stock-based compensation and related expenses, $10.3 million for deferred compensation plan expense and $1.3 million for amortization of acquisition-related intangible assets, compared with $641.1 million for the year ended December 31, 2023, excluding $149.7 million for stock-based compensation expense, $9.6 million for deferred compensation plan expense and $0.1 million for amortization of acquisition-related intangible assets.

GAAP other income, net was $33.6 million for the year ended December 31, 2024, compared with $24.1 million for the year ended December 31, 2023.

Non-GAAP other income, net (1) was $24.2 million for the year ended December 31, 2024, excluding $9.4 million for deferred compensation plan income, compared with $15.6 million for the year ended December 31, 2023, excluding $8.5 million for deferred compensation plan income.

GAAP income before income taxes was $572.9 million for the year ended December 31, 2024, compared with $505.8 million for the year ended December 31, 2023.

Non-GAAP income before income taxes (1) was $788.3 million for the year ended December 31, 2024, excluding $213.2 million for stock-based compensation and related expenses, $1.3 million for amortization of acquisition-related intangible assets and $0.9 million for net deferred compensation plan expense, compared with $656.7 million for the year ended December 31, 2023, excluding $149.7 million for stock-based compensation expense, $1.1 million for net deferred compensation plan expense and $0.1 million for amortization of acquisition-related intangible assets.

GAAP net income was $1.8 billion and $36.59 per diluted share for the year ended December 31, 2024. Comparatively, GAAP net income was $427.4 million and $8.76 per diluted share for the year ended December 31, 2023. GAAP net income and income per diluted share for the year ended December 31, 2024 included $1.3 billion for the recognition of a tax benefit granted to a foreign subsidiary.

Non-GAAP net income (1) was $689.8 million and $14.12 per diluted share for the year ended December 31, 2024 excluding $1.3 billion for the recognition of a tax benefit granted to a foreign subsidiary. Non-GAAP net income (1) for the year ended December 31, 2024 also excluded $213.2 million for stock-based compensation and related expenses, $1.3 million for amortization of acquisition-related intangible assets, $0.9 million for net deferred compensation plan expense and $26.9 million for the related tax effects, compared with $574.6 million and $11.78 per diluted share for the year ended December 31, 2023, excluding $149.7 million for stock-based compensation expense, $1.1 million for net deferred compensation plan expense, $0.1 million for amortization of acquisition-related intangible assets and $3.6 million for the related tax effects.

The following is a summary of revenue by end market (in thousands):

	Three Months Ended December 31,				Year Ended December 31,
End Market	2024		2023		2024		2023
Enterprise Data	$	194,867	$	128,897	$	716,264	$	322,980
Storage and Computing		136,507		117,312		501,576		491,139
Automotive		128,344		89,758		413,973		394,665
Communications		63,810		40,926		225,905		204,911
Consumer		57,311		43,741		202,015		234,660
Industrial		40,826		33,378		147,367		172,717
Total	$	621,665	$	454,012	$	2,207,100	$	1,821,072

“Our proven, long-term growth strategy remains intact as we continue our transformation from being a chip-only, semiconductor supplier to a full service, silicon-based solutions provider,” said Michael Hsing, CEO and founder of MPS.

Business Outlook

The following are MPS’s financial targets for the first quarter ending March 31, 2025:

Revenue in the range of $610.0 million to $630.0 million.

GAAP gross margin between 55.1% and 55.7%. Non-GAAP gross margin (1) between 55.4% and 56.0%, which excludes estimated stock-based compensation and related expenses of $1.7 million as well as the impact from amortization of acquisition-related intangible assets.

GAAP operating expenses between $180.2 million and $186.2 million. Non-GAAP operating expenses (1) between $126.9 million and $130.9 million, which excludes estimated stock-based compensation and related expenses in the range of $53.3 million to $55.3 million.

Total stock-based compensation and related expenses of $55.0 million to $57.0 million including approximately $1.7 million that would be charged to cost of goods sold.

Interest and other income in the range of $5.8 million to $6.2 million before foreign exchange gains or losses.

Non-GAAP tax rate of 15.0% for 2025.

Fully diluted shares outstanding between 47.8 million and 48.2 million.

(1) Non-GAAP net income, non-GAAP net income per share, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP other income, net, non-GAAP operating income and non-GAAP income before income taxes differ from net income, net income per share, gross margin, operating expenses, other income, net, operating income and income before income taxes determined in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). Non-GAAP net income and non-GAAP net income per share exclude the effect of stock-based compensation and related expenses, which include stock-based compensation expense and employer payroll taxes in relation to the stock-based compensation, net deferred compensation plan expense, amortization of acquisition-related intangible assets and related tax effects. Non-GAAP net income and non-GAAP net income per share also exclude the recognition of a tax benefit granted to a foreign subsidiary. Non-GAAP gross margin excludes the effect of stock-based compensation and related expenses, amortization of acquisition-related intangible assets and deferred compensation plan expense. Non-GAAP operating expenses exclude the effect of stock-based compensation and related expenses, amortization of acquisition-related intangible assets and deferred compensation plan expense. Non-GAAP operating income excludes the effect of stock-based compensation and related expenses, amortization of acquisition-related intangible assets and deferred compensation plan expense. Non-GAAP other income, net excludes the effect of deferred compensation plan income. Non-GAAP income before income taxes excludes the effect of stock-based compensation and related expenses, amortization of acquisition-related intangible assets and net deferred compensation plan expense. Projected non-GAAP gross margin excludes the effect of stock-based compensation and related expenses, and amortization of acquisition-related intangible assets. Projected non-GAAP operating expenses exclude the effect of stock-based compensation and related expenses. These non-GAAP financial measures are not prepared in accordance with GAAP and should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. A schedule reconciling non-GAAP financial measures is included at the end of this press release. MPS utilizes both GAAP and non-GAAP financial measures to assess what it believes to be its core operating performance and to evaluate and manage its internal business and assist in making financial operating decisions. MPS believes that the inclusion of non-GAAP financial measures, together with GAAP measures, provides investors with an alternative presentation useful to investors’ understanding of MPS’s core operating results and trends. Additionally, MPS believes that the inclusion of non-GAAP measures, together with GAAP measures, provides investors with an additional dimension of comparability to similar companies. However, investors should be aware that non-GAAP financial measures utilized by other companies are not likely to be comparable in most cases to the non-GAAP financial measures used by MPS. See the GAAP to non-GAAP reconciliations in the tables set forth below.

Earnings Commentary
Earnings commentary on the results of operations for the quarter and year ended December 31, 2024 is available under the Investor Relations page on the MPS website.

Earnings Webinar
MPS plans to host a question-and-answer conference call covering its financial results at 2:00 p.m. PT / 5:00 p.m. ET, February 6, 2025. The live event will be held via a Zoom webcast, which can be accessed at: https://mpsic.zoom.us/j/96816578886. The Zoom webcast can also be accessed live over the phone by dialing (669) 444-9171; the webcast ID is 96816578886. A replay of the event will be archived and available for replay for one year under the Investor Relations page on the MPS website.

Safe Harbor Statement
This press release contains, and statements that will be made during the accompanying webinar will contain, forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995, including under the “Business Outlook” section and the quote from our CEO herein, including, among other things, (i) projected revenue, GAAP and non-GAAP gross margin, GAAP and non-GAAP operating expenses, stock-based compensation and related expenses, amortization of acquisition-related intangible assets, other income before foreign exchange gains or losses, and fully diluted shares outstanding, (ii) our outlook for the first quarter of fiscal year 2025 and the near-term, medium-term and long-term prospects of MPS, including our ability to adapt to changing market conditions, performance against our business plan, our ability to grow despite the various challenges facing our business, our industry and the global economic environment, revenue growth in certain of our market segments, potential new business segments, our continued investment in research and development (“R&D”), expected revenue growth, customers’ acceptance of our new product offerings, the prospects of our new product development, our expectations regarding market and industry segment trends and prospects, and our projected expansion of capacity and the impact it may have on our business, (iii) our ability to penetrate new markets and expand our market share, (iv) the seasonality of our business, (v) our ability to reduce our expenses, and (vi) statements regarding the assumptions underlying or relating to any statement described in (i), (ii), (iii), (iv), or (v). These forward-looking statements are not historical facts or guarantees of future performance or events, are based on current expectations, estimates, beliefs, assumptions, goals, and objectives, and involve significant known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from the results expressed by these statements. Readers of this press release and listeners to the accompanying conference call are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date hereof. Factors that could cause actual results to differ include, but are not limited to, continued uncertainties in the global economy, including due to the Russia-Ukraine and Middle East conflicts, inflation, consumer sentiment and other factors; adverse events arising from orders or regulations of governmental entities, including such orders or regulations that impact our customers or suppliers, and adoption of new or amended accounting standards; adverse changes in laws and government regulations such as tariffs on imports of foreign goods, export regulations and export classifications, and tax laws or the interpretation of same, including in foreign countries where MPS has offices or operations; the effect of export controls, trade and economic sanctions regulations and other regulatory or contractual limitations on our ability to sell or develop our products in certain foreign markets, particularly in China; our ability to obtain governmental licenses and approvals for international trading activities or technology transfers, including export licenses; acceptance of, or demand for, our products, in particular the new products launched recently, being different than expected; our ability to increase market share in our targeted markets; difficulty in predicting or budgeting for future customer demand and channel inventories, expenses and financial contingencies (including as a result of any continuing impact from the Russia-Ukraine and Middle East conflicts); our ability to efficiently and effectively develop new products and receive a return on our R&D expense investment; our ability to attract new customers and retain existing customers; our ability to meet customer demand for our products due to constraints on our third-party suppliers’ ability to manufacture sufficient quantities of our products or otherwise; our ability to expand manufacturing capacity to support future growth; adverse changes in production and testing efficiency of our products; any political, cultural, military, regulatory, economic, foreign exchange and operational changes in China, where a significant portion of our manufacturing capacity comes from; any market disruptions or interruptions in our schedule of new product development releases; our ability to manage our inventory levels; adequate supply of our products from our third-party manufacturing partners; adverse changes or developments in the semiconductor industry generally, which is cyclical in nature, and our ability to adjust our operations to address such changes or developments; the ongoing consolidation of companies in the semiconductor industry; competition generally and the increasingly competitive nature of our industry; our ability to realize the anticipated benefits of companies and products that MPS acquires, and our ability to effectively and efficiently integrate these acquired companies and products into our operations; the risks, uncertainties and costs of litigation in which MPS is involved; the outcome of any upcoming trials, hearings, motions and appeals; the adverse impact on our financial performance if its tax and litigation provisions are inadequate; our ability to effectively manage our growth and attract and retain qualified personnel; the effect of epidemics and pandemics on the global economy and on our business; the risks associated with the financial market, economy and geopolitical uncertainties, including the collapse of certain banks in the U.S. and elsewhere and the Russia-Ukraine and Middle East conflicts; and other important risk factors identified under the caption “Risk Factors” and elsewhere in our Securities and Exchange Commission (“SEC”) filings, including, but not limited to, our Annual Report on Form 10-K filed with the SEC on February 29, 2024. MPS assumes no obligation to update the information in this press release or in the accompanying webinar.

About Monolithic Power Systems

Monolithic Power Systems, Inc. (“MPS”) is a fabless global company that provides high-performance, semiconductor-based power electronics solutions. MPS’s mission is to reduce energy and material consumption to improve all aspects of quality of life. Founded in 1997 by our CEO Michael Hsing, MPS has three core strengths: deep system-level knowledge, strong semiconductor expertise, and innovative proprietary technologies in the areas of semiconductor processes, system integration, and packaging. These combined advantages enable MPS to deliver reliable, compact, and monolithic solutions that are highly energy-efficient, cost-effective, and environmentally responsible while providing a consistent return on investment to our stockholders. MPS can be contacted through its website at www.monolithicpower.com or its support offices around the world.

Monolithic Power Systems, MPS, and the MPS logo are registered trademarks of Monolithic Power Systems, Inc. in the U.S. and trademarked in certain other countries.

Contact:
Bernie Blegen
Executive Vice President and Chief Financial Officer
Monolithic Power Systems, Inc.
408-826-0777
MPSInvestor.Relations@monolithicpower.com


Monolithic Power Systems, Inc. Condensed Consolidated Balance Sheets (Unaudited, in thousands, except par value)

	December 31,			December 31,
	2024			2023
ASSETS
Current assets:
Cash and cash equivalents	$	691,816		$	527,843
Short-term investments		171,130			580,633
Accounts receivable, net		172,518			179,858
Inventories		419,611			383,702
Other current assets		109,978			147,463
Total current assets		1,565,053			1,819,499
Property and equipment, net		494,945			368,952
Acquisition-related intangible assets, net		9,938			–
Goodwill		25,944			6,571
Deferred tax assets, net		1,326,840			28,054
Other long-term assets		194,377			211,277
Total assets	$	3,617,097		$	2,434,353

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	102,526		$	62,958
Accrued compensation and related benefits		63,918			56,286
Other accrued liabilities		128,123			115,791
Total current liabilities		294,567			235,035
Income tax liabilities		65,193			60,724
Other long-term liabilities		111,570			88,655
Total liabilities		471,330			384,414
Commitments and contingencies
Stockholders’ equity:
Common stock and additional paid-in capital: $0.001 par value; shares authorized: 150,000; shares issued and outstanding: 47,823 and 48,028, respectively		706,817			1,129,937
Retained earnings		2,487,461			947,064
Accumulated other comprehensive loss		(48,511	)		(27,062	)
Total stockholders’ equity		3,145,767			2,049,939
Total liabilities and stockholders’ equity	$	3,617,097		$	2,434,353


Monolithic Power Systems, Inc. Condensed Consolidated Statements of Operations (Unaudited, in thousands, except per share amounts)

	Three Months Ended December 31,					Year Ended December 31,
	2024			2023		2024			2023
Revenue	$	621,665		$	454,012	$	2,207,100		$	1,821,072
Cost of revenue		277,257			202,889		986,230			799,953
Gross profit		344,408			251,123		1,220,870			1,021,119
Operating expenses:
Research and development		85,762			71,459		324,748			263,643
Selling, general and administrative		95,339			70,095		356,764			275,740
Total operating expenses		181,101			141,554		681,512			539,383
Operating income		163,307			109,569		539,358			481,736
Other income, net		6,224			9,976		33,554			24,105
Income before income taxes		169,531			119,545		572,912			505,841
Income tax expense (benefit), net		(1,279,832	)		22,640		(1,213,788	)		78,467
Net income	$	1,449,363		$	96,905	$	1,786,700		$	427,374

Net income per share:
Basic	$	30.00		$	2.02	$	36.76		$	8.98
Diluted	$	29.88		$	1.98	$	36.59		$	8.76
Weighted-average shares outstanding:
Basic		48,317			47,936		48,599			47,610
Diluted		48,506			48,881		48,835			48,771


SUPPLEMENTAL FINANCIAL INFORMATION STOCK-BASED COMPENSATION EXPENSE (Unaudited, in thousands)

	Three Months Ended December 31,				Year Ended December 31,
	2024		2023		2024		2023
Cost of revenue	$	1,720	$	1,228	$	6,305	$	4,545
Research and development		12,166		10,204		45,626		36,611
Selling, general and administrative		42,124		29,675		153,709		108,555
Total stock-based compensation expense	$	56,010	$	41,107	$	205,640	$	149,711


RECONCILIATION OF NET INCOME TO NON-GAAP NET INCOME (Unaudited, in thousands, except per share amounts)

	Three Months Ended December 31,					Year Ended December 31,
	2024			2023		2024			2023
Net income	$	1,449,363		$	96,905	$	1,786,700		$	427,374

Adjustments to reconcile net income to non-GAAP net income:
Stock-based compensation and related expenses*		56,320			41,107		213,209			149,711
Amortization of acquisition-related intangible assets		320			33		1,303			132
Deferred compensation plan expense, net		573			288		867			1,055
Tax effect of non-GAAP adjustments		(22,773	)		2,519		(26,922	)		(3,625	)
Recognition of a tax benefit granted to a foreign subsidiary		(1,285,402	)		–		(1,285,402	)		–
Non-GAAP net income	$	198,401		$	140,852	$	689,755		$	574,647

Non-GAAP net income per share:
Basic	$	4.11		$	2.94	$	14.19		$	12.07
Diluted	$	4.09		$	2.88	$	14.12		$	11.78

Shares used in the calculation of non-GAAP net income per share:
Basic		48,317			47,936		48,599			47,610
Diluted		48,506			48,881		48,835			48,771

*Prior periods exclude stock-based compensation related employer payroll taxes from non-GAAP measures due to immateriality.


RECONCILIATION OF GROSS MARGIN TO NON-GAAP GROSS MARGIN (Unaudited, in thousands)

	Three Months Ended December 31,						Year Ended December 31,
	2024			2023			2024			2023
Gross profit	$	344,408		$	251,123		$	1,220,870		$	1,021,119
Gross margin		55.4	%		55.3	%		55.3	%		56.1	%

Adjustments to reconcile gross profit to non-GAAP gross profit:
Stock-based compensation and related expenses*		1,745			1,228			6,975			4,545
Amortization of acquisition-related intangible assets		287			–			1,171			–
Deferred compensation plan expense		417			486			1,500			871
Non-GAAP gross profit	$	346,857		$	252,837		$	1,230,516		$	1,026,535
Non-GAAP gross margin		55.8	%		55.7	%		55.8	%		56.4	%

*Prior periods exclude stock-based compensation related employer payroll taxes from non-GAAP measures due to immateriality.


RECONCILIATION OF OPERATING EXPENSES TO NON-GAAP OPERATING EXPENSES (Unaudited, in thousands)

	Three Months Ended December 31,						Year Ended December 31,
	2024			2023			2024			2023
Total operating expenses	$	181,101		$	141,554		$	681,512		$	539,383

Adjustments to reconcile total operating expenses to non-GAAP total operating expenses:
Stock-based compensation and related expenses*		(54,575	)		(39,879	)		(206,234	)		(145,166	)
Amortization of acquisition-related intangible assets		(33	)		(33	)		(132	)		(132	)
Deferred compensation plan expense		(376	)		(4,897	)		(8,767	)		(8,690	)
Non-GAAP operating expenses	$	126,117		$	96,745		$	466,379		$	385,395

*Prior periods exclude stock-based compensation related employer payroll taxes from non-GAAP measures due to immateriality.


RECONCILIATION OF OPERATING INCOME TO NON-GAAP OPERATING INCOME (Unaudited, in thousands)

	Three Months Ended December 31,				Year Ended December 31,
	2024		2023		2024		2023
Total operating income	$	163,307	$	109,569	$	539,358	$	481,736

Adjustments to reconcile total operating income to non-GAAP total operating income:
Stock-based compensation and related expenses*		56,320		41,107		213,209		149,711
Amortization of acquisition-related intangible assets		320		33		1,303		132
Deferred compensation plan expense		793		5,383		10,267		9,561
Non-GAAP operating income	$	220,740	$	156,092	$	764,137	$	641,140

*Prior periods exclude stock-based compensation related employer payroll taxes from non-GAAP measures due to immateriality.


RECONCILIATION OF OTHER INCOME, NET, TO NON-GAAP OTHER INCOME, NET (Unaudited, in thousands)

	Three Months Ended December 31,						Year Ended December 31,
	2024			2023			2024			2023
Total other income, net	$	6,224		$	9,976		$	33,554		$	24,105

Adjustments to reconcile other income, net to non-GAAP other income, net:
Deferred compensation plan income		(220	)		(5,095	)		(9,400	)		(8,506	)
Non-GAAP other income, net	$	6,004		$	4,881		$	24,154		$	15,599


RECONCILIATION OF INCOME BEFORE INCOME TAXES TO NON-GAAP INCOME BEFORE INCOME TAXES (Unaudited, in thousands)

	Three Months Ended December 31,				Year Ended December 31,
	2024		2023		2024		2023
Total income before income taxes	$	169,531	$	119,545	$	572,912	$	505,841

Adjustments to reconcile income before income taxes to non-GAAP income before income taxes:
Stock-based compensation and related expenses*		56,320		41,107		213,209		149,711
Amortization of acquisition-related intangible assets		320		33		1,303		132
Deferred compensation plan expense, net		573		288		867		1,055
Non-GAAP income before income taxes	$	226,744	$	160,973	$	788,291	$	656,739

*Prior periods exclude stock-based compensation related employer payroll taxes from non-GAAP measures due to immateriality.


2025 FIRST QUARTER OUTLOOK RECONCILIATION OF GROSS MARGIN TO NON-GAAP GROSS MARGIN (Unaudited)

	Three Months Ending
	March 31, 2025
	Low			High
Gross margin		55.1	%		55.7	%
Adjustment to reconcile gross margin to non-GAAP gross margin:
Stock-based compensation and other expenses		0.3	%		0.3	%
Non-GAAP gross margin		55.4	%		56.0	%


RECONCILIATION OF OPERATING EXPENSES TO NON-GAAP OPERATING EXPENSES (Unaudited, in thousands)

	Three Months Ending
	March 31, 2025
	Low			High
Operating expenses	$	180,200		$	186,200
Adjustments to reconcile operating expenses to non-GAAP operating expenses:
Stock-based compensation and other expenses		(53,300	)		(55,300	)
Non-GAAP operating expenses	$	126,900		$	130,900

The MIL Network –

February 7, 2025

MIL-OSI USA: Risch, Daines Introduce Bill to Give Small Businesses Permanent Tax Break

US Senate News:

Source: United States Senator for Idaho James E Risch

WASHINGTON – U.S. Senators Jim Risch (R-Idaho) and Steve Daines (R-Mont.) introduced the Main Street Tax Certainty Act to permanently extend the 20 percent tax deduction for pass-through businesses. Should these tax cuts expire, small businesses will face an immediate and massive tax hike.

“Inflicting a 20% tax increase on Idaho’s small businesses would be damaging to our economy and local communities,” said Risch. “The Main Street Tax Certainty Actensures these establishments remain the driving force Idaho’s economy and thrive for generations to come.”

“As the son of a contractor, I’ve seen firsthand the hard work it takes to keep a small business flourishing- especially as Americans are still grappling with the effects of Joe Biden’s inflation. It’s absolutely crucial that we pass this legislation to prevent a 20 percent tax increase for hardworking Montanans and I’ll keep fighting for ways to support Montana small businesses, which provide the majority of jobs in our state,” said Daines.

The 20% small business deduction was created as a part of President Trump’s 2017 tax cuts to level the playing field between small businesses and large corporations. Without Congressional action, 9 out of 10 small businesses will be hit with a massive tax hike when this deduction is set to expire at the end of 2025.

Senators John Thune (R-S.D.), John Barrasso (R-Wyo.), Shelley Moore Capito (R-W.V.), James Lankford (R-Okla.), Joni Ernst (R-Iowa), Tom Cotton (R-Ark.), Tim Scott (R-S.C.), Chuck Grassley (R-Iowa), Kevin Cramer (R-N.D.), Jerry Moran (R-Kan.), Marsha Blackburn (R-Tenn.), Mike Rounds (R-S.D.), Pete Ricketts (R-Neb.), Katie Britt (R-Ala.), Eric Schmitt (R-Mo.), Roger Wicker (R-Miss.), Cynthia Lummis (R-Wyo.), Cindy Hyde-Smith (R-Miss.), Tommy Tuberville (R-Ala.), Ted Cruz (R-Texas), John Hoeven (R-N.D.), Thom Tillis (R-N.C.), Roger Marshall (R-Kan.), Jim Justice (R-W.V.), Tim Sheehy (R-Mont.), Deb Fischer (R-Neb.), Bill Cassidy (R-La.), Ted Budd (R-N.C.), Rick Scott (R-Fla.), Bill Hagerty (R-Tenn.), Todd Young (R-Ind.), John Kennedy (R-La.) and Jim Banks (R-Ind.) joined Risch and Daines in introducing the legislation.

Recently, a new study from Ernst and Young (EY) highlighted the economic activity supported by this small and family-owned business tax deduction, including 2.6 million jobs and $325 billion of the GDP.?

MIL OSI USA News –

February 7, 2025

MIL-OSI New Zealand: Universities – Can artists really take back their music like Swift? – UoA

Source: University of Auckland

Taylor Swift’s re-recordings rocked the music industry – can other artists reclaim their music too? A journal article explores the options.

Taylor Swift and her millions of fans may be disappointed by her 2025 Grammys ‘snub’, but the billionaire artist still has much to celebrate, most notably, her successful fight to take ownership of her music in an industry long dominated by influential record labels.

University of Auckland copyright expert Dr Joshua Yuvaraj says Swift significantly impacted the industry when she re-recorded several of her albums after the rights to her music were sold from under her.

In his paper, published in the Journal of Intellectual Property Law and Practice and presented at the University of Melbourne’s Taylor Swift-themed academic conference, Swiftposium, the senior law lecturer examines how re-recording can help artists gain control of their music. He compares this strategy with the primary mechanism available under US copyright law: statutory reversion. (ref. https://academic.oup.com/jiplp/article/19/12/884/7913103 )

His article looks at how reversion applies to sound recordings, focusing on the US copyright ‘termination’ provision, which lets creators reclaim copyright, typically after around 35 years. The size of the US recording market makes this scheme the most high-profile reversion system in the world. However, Yuvaraj argues that re-recording may offer a more accessible alternative to these legal processes.

“In theory, copyright reversion gives artists a second chance at controlling their recordings. But in practice, the US system has significant obstacles: a long waiting period, complex legal requirements, and uncertainty over whether sound recordings are even covered.”

Many artists simply don’t have the time or resources to navigate this legal quagmire, says Yuvaraj.

“There are considerable power imbalances between artists and record companies,” he says. “For example, copyright is often assigned before the true value of a song is even known.”

Re-recording, as Swift did, allows artists to sidestep these legal barriers. While the copyright in an original sound recording remains with the label, a newly recorded version, if produced independently, is treated as a separate work under copyright law – as long as the artist retained control, or had a license to reproduce the song itself, which has a separate musical copyright to the recording.

“Taylor Swift’s success put re-recording in the spotlight as a way for artists to regain control over their music without waiting decades for copyright reversion laws to take effect,” says Yuvaraj.

He says that unlike statutory reversion, re-recording requires much shorter waiting periods, allowing musicians to capitalise on market demand more quickly. There’s also less procedural complexity, and as long as artists comply with contractual waiting periods, they are unlikely to face legal action.

Despite Swift’s success – her re-recorded albums were critically praised and financially lucrative – Yuvaraj notes that re-recording isn’t a viable solution for everyone.

“It requires a strong fan base willing to embrace the new versions, and not all musicians have that level of market power,” he says.

And while Swift’s re-recording battle highlighted power imbalances in artist contracts, it also saw record labels tighten their grip. There are reports of extended re-recording restrictions in contracts from the standard three to seven years to 20 or 30 years, making re-recording a less accessible option for future artists.

Despite this roadblock, Yuvaraj says Swift’s case sparked important conversations about artist rights, and some musicians are now negotiating deals that allow them to retain ownership of their master recordings from the outset, eliminating the need for re-recording altogether.

“Swift’s case brought re-recording into the public eye, but it doesn’t replace the need for fairer contracts and stronger copyright protections.”

MIL OSI New Zealand News –

February 7, 2025

MIL-OSI USA: February 6th, 2025 Heinrich Sounds the Alarm on “DOGE” Risk to National Security & American Privacy

US Senate News:

Source: United States Senator for New Mexico Martin Heinrich

WASHINGTON — Today, U.S. Senator Martin Heinrich (D-N.M.), a member of the Senate Select Committee on Intelligence, pressed the White House on the risks of allowing unvetted “Department of Government Efficiency” (DOGE) staff and representatives to access classified and sensitive government materials. In a letter to White House Chief of Staff Susie Wiles, Heinrich sounded the alarm on the risk DOGE poses to our national security and Americans’ privacy.

In the letter, Heinrich, U.S. Senator Mark R. Warner (D-Va.), and several colleagues demanded that the administration provide details to Congress about how DOGE staff and representatives are being vetted, which systems, records and information are being shared, and what steps the Trump administration is taking to safeguard them from misuse or disclosure.

“According to press reports, DOGE inspectors already have gained access to classified materials, including intelligence reports, at the United States Agency for International Development (USAID), sensitive government payment systems, including for Social Security and Medicare, at the Treasury Department, and federal personnel data from the Office of Personnel Management. Further, as of today the scope of DOGE’s access only seems to be expanding, as reports indicate DOGE has now entered the Department of Labor and other agencies,” Heinrich wrote. “No information has been provided to Congress or the public as to who has been formally hired under DOGE, under what authority or regulations DOGE is operating, or how DOGE is vetting and monitoring its staff and representatives before providing them seemingly unfettered access to classified materials and Americans’ personal information.”

Heinrich added, “As you know, information is classified to protect the national security interests of the United States. Government employees and contractors only receive access to such information after they have undergone a rigorous background investigation and demonstrated a ‘need to know.’ Circumventing these requirements creates enormous counterintelligence and security risks. For example, improper access to facilities and systems containing security clearance files of Intelligence Community personnel puts at risk the safety of the men and women who serve this country. In addition, unauthorized access to classified information risks exposure of our operations and potentially compromises not only our own sources and methods, but also those of our allies and partners. If our sources, allies, and partners stop sharing intelligence because they cannot trust us to protect it, we will all be less safe.”

Heinrich also raised alarms about the privacy implications of allowing an unknown number of DOGE staff to access unclassified systems containing information about individual American taxpayers and organizations.

Heinrich continued, “Unclassified government systems also contain sensitive data, the unintended disclosure of which could result in significant harm to individuals or organizations, including financial loss, identity theft, and exposure of medical and other private personal information. The U.S. Treasury payment systems, in particular, are used to disburse trillions of dollars each year, and contain everyday Americans’ personal information, such as Social Security numbers, home addresses, and bank accounts. Allowing DOGE access to this information raises unprecedented risks to Americans’ private personal and financial information.”

The letter also noted that there are strict cybersecurity controls in place for federal networks that DOGE does not seem to be following, including by reportedly connecting personal devices to sensitive government systems.

“Such unregulated practices with our government’s most sensitive networks render Americans’ personal and financial information, and our classified national secrets, vulnerable to ransomware and cyber-attacks by criminals and foreign adversaries. The recent unprecedented Salt Typhoon and Change Healthcare attacks that affected tens of millions of Americans further underscore the importance of rigorously fortifying our government systems,” Heinrich stated.

Alongside Heinrich and Warner, U.S. Senators Ron Wyden (D-Ore.), Angus King (I-Maine), Michael Bennet (D-Colo.), Kirsten Gillibrand (D-N.Y.), Jon Ossoff (D-Ga.), and Mark Kelly (D-Ariz.) joined the letter.

The full text of the letter is here.

MIL OSI USA News –

February 7, 2025

MIL-OSI USA: February 6th, 2025 Heinrich, Moran Introduce Legislation to Create Pathways to Stable Careers, Expand Access to Apprenticeships & Technical Education

US Senate News:

Source: United States Senator for New Mexico Martin Heinrich

WASHINGTON — U.S. Senator Martin Heinrich (D-N.M.) introduced the Apprenticeship Pathways Act, legislation to create pathways to high-demand careers for high school students by expanding access to apprenticeships and technical education. Heinrich introduced the bill with U.S. Senator Jerry Moran (R-Kan.).

Apprenticeships and technical education offer a direct path to acquiring in-demand skills, and early exposure to industries can encourage more students to pursue careers in those professions. Expanding apprenticeship programs for high school students can help address workforce shortages and ensure a sustainable workforce pipeline. This legislation particularly focuses on apprenticeship programs for occupations with high need, including the building trades, healthcare, manufacturing, technology, telecommunications, and early childhood education.

“If we want to set the next generation up for success, we need to go all in on expanding access to career-connected learning like apprenticeships as early as high school. By providing students with more preparation and job skills, we will ensure more New Mexicans have the opportunity to access careers in their own communities that they can build their families around, while strengthening New Mexico’s middle class and growing our state’s economy,” said Heinrich.

“Apprenticeships bridge the gap between education and production, providing hands-on learning opportunities that benefit both students and employers in technical fields,” said Moran. “Aligning tech training with industry demands will help meet the workforce needs in Kansas and expand high-paying career opportunities in the IT industry.”

The Apprenticeship Pathways Act would direct the U.S. Secretary of Labor to provide grants to industry intermediaries to develop and establish apprenticeship programs for high school students in the building trades, health care, early childhood education, technology, and manufacturing — based on local, regional, and national workforce trends. This model provides students on-the-job training and instruction, real-world experiences and responsibilities, and inspiring career pathways ahead of their entrance to the workforce.

“Thanks to Senator Heinrich, and this legislation, New Mexico will soon provide pre-apprenticeship opportunities to young people around the state, especially in our underserved communities. Pre-apprenticeship is an essential on-ramp for high schoolers and recent graduates to access in demand, high wage careers. It’s a critical step in making our communities more prosperous,” said Mike May, Director of Workforce Learning for Future Focused Education.

The text of the bill is here.

Heinrich’s Longtime Support for Workforce Training and Apprenticeships:

This week, Heinrich announced $1,350,000 in federal funding that he secured through the Fiscal Year 2024 appropriations process for the United Association of Plumbers & Pipefitters Local 412 (U.A. Local 412). The funding will support specialized journeyman training focused on filling jobs created by the CHIPS Act and Inflation Reduction Act, including needs specific to semiconductor plants, hospitals, and heat pump installation, service, repair, and maintenance. Through his work on the Senate Appropriations Committee, Heinrich has further supported the U.A. Local 412’s workforce development efforts by securing $1.2 million in the Fiscal Year 2023 Appropriations Bill.

In October 2024, Heinrich visited U.A. 412’s mobile training unit, which is creating more pathways to in-demand careers in the skilled trades and has already trained dozens of New Mexicans in Española, Taos, Las Vegas, Mora, Raton, and Santa Fe. Heinrich also participated in a training demonstration with U.A. Local 412 leadership and apprentices who are learning skills in the plumbing, pipefitting, and HVAC trades.

The U.A. Local 412 Mobile Training Unit was initially paid for by an Economic Development Administration (EDA) Good Jobs Challenge Grant, as part of a $6.4 million award to the Northern N.M. Workforce Integration Network. The Good Jobs Challenge funds were authorized by the American Rescue Plan, the critical economic recovery legislation that Heinrich was proud to pass in 2021.

Heinrich is continuing to press for passage of Fiscal Year 2025 Appropriations Bills. The Senate Appropriations Committee passed bills last year that included an additional $870,000 CDS award that he secured within the Senate Appropriations Committee-passed Labor, Health and Human Services, Education Appropriations Bill to sustain the U.A. Local 412’s mobile training unit’s operations past the original EDA funding, and to expand its reach to new communities including Grants, Gallup, Silver City, and Zuni Pueblo.

Heinrich has long championed proven workforce training programs like U.A. Local 412’s apprenticeship and pre-apprenticeship programs that are growing the middle class, creating and connecting New Mexicans to high-quality careers they can access in their communities, and continuing New Mexico’s leading role in the clean energy transition that is being built by union workers in the skilled trades.

Last year, Heinrich hosted a “Pro-Worker, Pro-Business Opportunities” roundtable to talk directly with New Mexicans about how federal legislation he helped pass into law, like the Inflation Reduction Act and Infrastructure Law, is creating careers in high-demand sectors and strengthening New Mexico’s health care, early childhood education, and skilled trades workforce.

In the last Congress, Heinrich introduced the bipartisan Apprenticeship Pathways Act, legislation to create pathways to careers for high school students by expanding access to apprenticeship programs for occupations with high need, including the building trades, healthcare, manufacturing, technology, telecommunications, and early childhood education. Last year, Heinrich also introduced the Pre-Apprenticeships To Hardhats (PATH) Act, legislation to strengthen the pipeline for careers in New Mexico, address rising workforce shortages, and grow the state’s economy through quality pre-apprenticeship programs.

Last Congress, Courtenay Eichhorst, Business Manager of U.A. Local 412 and President of New Mexico Building Trades, testified about the importance of apprenticeships and pre-apprenticeships during a hearing that Heinrich convened as the Chairman of the Joint Economic Committee on “Job Training for the Clean Energy Transition.”

Eichhorst said during that JEC hearing, “In addition to our ‘gold standard’ apprenticeship programs, the UA and other Building Trades’ unions are also increasingly investing in pre-apprenticeship programs that can be designed to help prepare high school students or individuals from underrepresented communities for a career in the trades. These programs help fill the role that used to be filled by the ‘shop classes’ that were found in high schools but have become increasingly rare. Pre-apprenticeship programs also focus on the ‘soft skills’ that are necessary for success in any industry, such as showing up on time and other work etiquette.”

Also in the Fiscal Year 2024 Appropriations Bills, Heinrich secured $1,200,000 in Congressionally Directed Spending for the SMART Local Union No. 49 Joint Apprenticeship and Training Committee to enhance and expand specialized HVAC apprenticeship training.

Last March, Heinrich introduced the Providing Resources and Opportunities for Health Education and Learning (PRO-HEAL) Act, legislation that will tackle the health care provider shortage in New Mexico and nationwide by expanding pathways to high-quality, in-demand health care careers that medical professionals can access in their communities. Specifically, the PRO-HEAL Act addresses medical provider shortages by incentivizing states and institutions of higher education to expand or create health care provider pipeline programs, particularly in underserved and rural communities. The legislation is inspired by the success of the Combined BA/MD Degree Program at the University of New Mexico, where over 65% of students who have graduated from their program practice medicine in New Mexico.

Heinrich previously introduced the Pathways to Health Careers Act, legislation that reauthorizes and modernizes the Health Profession Opportunity Grant (HPOG) program to help address health care shortages in New Mexico and across the country and create pathways to high-quality, in-demand health care careers. The HPOG program has a proven track record of successfully educating workers for jobs in the health care industry, while also providing career coaching, job placement, and a mix of other support services. The Pathways to Health Careers Act would restart and expand the HPOG Program, providing $425 million to make HPOG available nationwide from FY2024 through FY2028 and includes set asides for Tribes and U.S. Territories.

In 2021, Heinrich and Moran introduced the Championing Apprenticeships for New Careers and Employees in Technology (CHANCE in Tech) Act, bipartisan legislation to create earlier pathways to high-paying careers in the information technology (IT) industry. Heinrich previously introduced the bipartisan legislation in 2019 with former U.S. Senator Cory Gardner (R-Colo.).

MIL OSI USA News –

February 7, 2025

MIL-OSI USA: Senators Marshall, Kaine Introduce Bipartisan Bill to Help More Americans Access High-Quality Job Training, Get Good-Paying Jobs

US Senate News:

Source: United States Senator for Kansas Roger Marshall

Washington, D.C. – U.S. Senators Roger Marshall, M.D. and Tim Kaine (D-VA) introduced the Jumpstarting Our Businesses by Supporting Students (JOBS) Act, bipartisan legislation to help more Americans get good-paying jobs by allowing students to use federal Pell Grants—need-based education grants for lower-income individuals—to pay for shorter-term job training programs for the first time. Currently, students can only use Pell Grants for two- and four-year colleges and universities. By expanding Pell Grant eligibility, the JOBS Act would help close the skills gap by allowing people to access job training they might otherwise be unable to afford but need for careers in high-demand fields.
“The JOBS Act will provide an incredible opportunity for students in an ever-changing job market,” Senator Marshall said. “Our legislation will give Americans the chance to learn critical skills for a successful career. I look forward to getting the JOBS Act across the finish line with my colleagues.”
“No one should be priced out of an education—including a technical education—but I hear from many Virginians that access to high-quality job training programs that align with their goals is out of reach because of financial barriers,” said Senator Kaine. “Simultaneously, I hear from employers throughout the Commonwealth about their struggles to fill skilled labor positions. With these Virginians in mind, I wrote the JOBS Act to help remedy these issues and provide more workers with the skills they need to get good-paying jobs and provide for their families. This bill is good for workers, good for employers, and good for our economy as a whole.”
The JOBS Act would allow Pell Grants to be used for high-quality job training programs that are at least eight weeks in length and lead to industry-recognized credentials or certificates. Under current law, Pell Grants can only be applied toward programs that are over 600 clock hours or at least 15 weeks in length, rendering students in shorter-term high-quality job training programs ineligible for crucial assistance.
The legislation is cosponsored by U.S. Senators Tammy Baldwin (D-WI), Richard Blumenthal (D-CT), Lisa Blunt Rochester (D-DE), Cory Booker (D-NJ), Shelley Moore Capito (R-WV), Chris Coons (D-DE), Catherine Cortez Masto (D-NV), Kevin Cramer (R-ND), Steve Daines (R-MT), Tammy Duckworth (D-IL), Kirsten Gillibrand (D-NY), Maggie Hassan (D-NH), Martin Heinrich (D-NM), John Hickenlooper (D-CO), John Hoeven (R-ND), Cindy Hyde-Smith (R-MS), Mark Kelly (D-AZ), Angus King (I-ME), Amy Klobuchar (D-MN), Jeff Merkley (D-OR), Jon Ossoff (D-GA), Gary Peters (D-MI), Jacky Rosen (D-NV), Jeanne Shaheen (D-NH), Dan Sullivan (D-AK), Thom Tillis (R-NC), Tommy Tuberville (R-AL), Chris Van Hollen (D-MD), Mark R. Warner (D-VA), Roger Wicker (R-MS), and Ron Wyden (D-OR).

MIL OSI USA News –

February 7, 2025

MIL-OSI Security: Siblings Plead Guilty to COVID Relief Fraud

Source: Federal Bureau of Investigation (FBI) State Crime News

Hattiesburg, MS – A Forrest County man and woman pled guilty to conspiring with each other to fraudulently obtain unemployment insurance benefits related to the COVID-19 pandemic.

According to court documents and statements made in court, Artista Garner, 36, of Hattiesburg, assisted her brother, Thaddieus Cooper, 31, in applying for benefits with the Mississippi Department of Employment Security. As an inmate in the Mississippi Department of Corrections (MDOC), Cooper was not entitled to receive unemployment insurance benefits. Cooper was serving a sentence of six years in MDOC custody for armed robbery. Garner used the unemployment funds for her personal benefit and transferred some of the funds to Cooper via his commissary fund.

The unemployment insurance benefits were federally subsidized through the CARES Act in response to the pandemic.

A federal grand jury returned an indictment against Cooper and Garner on September 10, 2024. Both Cooper and Garner pled guilty on January 30, 2025, to conspiracy to commit wire fraud. They are scheduled to be sentenced on June 12, 2025, and they each face a maximum penalty of 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting United States Attorney Patrick A. Lemon, Mississippi State Auditor Shad White, and Special Agent in Charge Mathew Broadhurst of the U.S. Department of Labor, Office of Inspector General, Southeast Region made the announcement.

The U.S. Department of Labor, Office of Inspector General and the Mississippi Office of the State Auditor investigated the case.

Assistant U.S. Attorney Kimberly T. Purdie is prosecuting the case.

This case is being prosecuted as part of the Department of Justice’s National Unemployment Insurance Fraud Task Force (NUIFTF). In response to the unprecedented scope of Unemployment Insurance (UI) fraud, the Department of Justice established the NUIFTF. The NUIFTF is a prosecutor-led multi-agency task force with representatives from FBI, DOL-OIG, IRS-CI, HSI, DHS-OIG, USPIS, USSS, SSA-OIG, FDIC-OIG, and other agencies. Members of the NUIFTF are working with state workforce agencies, financial institutions, and other law enforcement partners across the country to fight UI fraud, and consumers should be vigilant in light of these threats and take the appropriate steps to safeguard themselves.

The CARES Act is a federal law enacted on March 29, 2020, designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act is the authorization that expands states’ ability to provide unemployment insurance for many workers impacted by COVID-19, including for workers who are not ordinarily eligible for unemployment insurance benefits.

Anyone with information about attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866‑720‑5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.

MIL Security OSI –

February 7, 2025

MIL-Evening Report: Gaza: we analysed a year of satellite images to map the scale of agricultural destruction

Source: The Conversation (Au and NZ) – By Lina Eklund, Associate Senior Lecturer, Lund University

Part of North Gaza in November 2023, and again in July 2024.

The ceasefire agreed between Israel and Hamas makes provisions for the passage of food and humanitarian aid into Gaza. This support is much needed given that Gaza’s agricultural system has been severely damaged over the course of the war.

Over the past 17 months we have analysed satellite images across the Gaza Strip to quantify the scale of agricultural destruction across the region. Our newly published research reveals not only the widespread extent of this destruction but also the potentially unprecedented pace at which it occurred. Our work covers the period until September 2024 but further data through to January 2025 is also available.

Before the war, tomatoes, peppers, cucumbers and strawberries were grown in open fields and greenhouses, and olive and citrus trees lined rows across the Gazan landscape. The trees in particular are an important cultural heritage in the region, and agriculture was a vital part of Gaza’s economy. About half of the food eaten there was produced in the territory itself, and food made up a similar portion of its exports.

By December 2023, only two months into the war, there were official warnings that the entire population of Gaza, more than 2 million people, was facing high levels of acute food insecurity. While that assessment was based on interviews and survey data, the level of agricultural damage across the whole landscape remained out of view.

Most olive and citrus trees are gone

To address this problem, we mapped the damage to tree crops – mostly olive and citrus trees – in Gaza each month over the course of the war up until September 2024. Together with our colleagues Dimah Habash and Mazin Qumsiyeh, we did this using very high-resolution satellite imagery, detailed enough to focus on individual trees.

We first visually identified tree crops with and without damage to “train” our computer program, or model, so it knew what to look for. We then ran the model on all the satellite data. We also looked over a sample of results ourselves to confirm it was accurate.

Our results showed that between 64% and 70% of all tree crop fields in Gaza had been damaged. That can either mean a few trees being destroyed, the whole field of trees completely removed, or anything in between. Most damage took place during the first few months of the war in autumn 2023. Exactly who destroyed these trees and why is beyond the scope of our research or expertise.

In some areas, every greenhouse is gone

As greenhouses look very different in satellite images, we used a separate method to map damage to them. We found over 4,000 had been damaged by September 2024, which is more than half of the total we had identified before the start of the war.

Greenhouses and the date of initial damage between October 2023 and September 2024.
Yin et al (2025)

In the south of the territory, where most greenhouses were found, the destruction was fairly steady from December 2023 onwards.

But in north Gaza and Gaza City, the two most northerly of the territory’s five governorates, most of the damage had already taken place by November and December 2023. By the end of our study period, all 578 greenhouses there had been destroyed.

North Gaza and Gaza City have also seen the most damage to tree crop fields. By September 2024, over 90% of all tree crops in Gaza City had been destroyed, and 73% had been lost in north Gaza. In the three southern governorates, Khan Younis, Deir al-Balah and Rafah, around 50% of all tree crops had been destroyed.

Agricultural damage is common in armed conflict, and has been documented with satellite analysis in Ukraine since the 2022 Russian invasion, in Syria and Iraq during the ISIS occupation in 2015, and in the Caucasus during the Chechen wars in the 1990s and 2000s.

The exact impact can differ from conflict to conflict. War may directly damage lands, as we have seen in Gaza, or it may lead to more fallow areas as infrastructure is damaged and farmers are forced to flee. A conflict also increases the need for local agricultural production, especially when food imports are restricted.

Our assessment shows a very high rate of direct and extensive damage to Gaza’s agricultural system, both compared to previous conflict escalations there in 2014 and 2021, and in other conflict settings. For example, during the July-August war in 2014, around 1,200 greenhouses were damaged in Gaza. This time round at least three times as many have been damaged.

Agricultural attacks are unlawful

Attacks on agricultural lands are prohibited under international law. The Rome Statute of the International Criminal Court from 1998 defines the intentional use of starvation of civilians through “depriving them of objects indispensable to their survival” as a war crime. The Geneva conventions further define such indispensable objects as “foodstuffs, agricultural areas for the production offoodstuffs, crops, livestock, drinking water installations and supplies and irrigation works”.

Our study provides transparent statistics on the extent and timing of damage to Gaza’s agricultural system. As well as documenting the impacts of the war, we hope it can help the massive rebuilding efforts that will be required.

Restoring Gaza’s agricultural system goes beyond clearing debris and rubble, and rebuilding greenhouses. The soils need to be cleaned from possible contamination. Sewage and irrigation infrastructure need to be rebuilt.

Such efforts may take a generation or more to complete. After all, olive and citrus trees can take five or more years to become productive, and 15 years to reach full maturity. After previous attacks on Gaza the trees were mostly replanted, and perhaps the same will happen again this time. But it’s for good reason they say that only people with hope for the future plant trees.

Lina Eklund receives funding from the Swedish National Space Agency and the Strategic Research Area: The Middle East in the Contemporary World (MECW) at the Centre for Advanced Middle Eastern Studies, Lund University, Sweden.

He Yin receives funding from NASA.

Jamon Van Den Hoek receives funding from NASA.

– ref. Gaza: we analysed a year of satellite images to map the scale of agricultural destruction – https://theconversation.com/gaza-we-analysed-a-year-of-satellite-images-to-map-the-scale-of-agricultural-destruction-248796

MIL OSI Analysis – EveningReport.nz –

February 7, 2025

MIL-OSI USA: Murray, Sanders, Baldwin, DeLauro, Scott Demand Answers on Trump’s Plans to Dismantle Education Department

US Senate News:

Source: United States Senator for Washington State Patty Murray

Washington, D.C. — Senators Patty Murray (D-WA), Vice Chair of the Senate Appropriations Committee; Tammy Baldwin (D-WI), Ranking Member of the Senate Appropriations Subcommittee on Labor, Health, and Human Services, and Education; and Bernie Sanders (I-VT), Member of the Senate Health, Education, Labor and Pensions (HELP) Committee alongside Representatives Bobby Scott (D-VA), Ranking Member of the House Committee on Education and Workforce, and Rosa DeLauro (D-Conn.), Ranking Member of the House Appropriations Committee and the Subcommittee on Labor, Health, and Human Services, and Education sent a letter warning against the Trump administration’s reported plans to unilaterally dismantle the Department of Education. The lawmakers asked the acting Secretary of Education for answers on recent actions taken by the Trump administration to put federal workers on administrative leave, coerce employees into leaving their jobs, provide access to students’ sensitive data, and illegally freeze vital funding.

“Over the course of two weeks, the Trump Administration issued sweeping executive orders and sought to broadly and illegally freeze federal financial assistance,” wrote Sanders and the lawmakers. “Federal employees have been targeted, in some cases for simply following the law. Elon Musk is attempting to shut down the work of entire agencies while gaining access to some of the federal government’s most far reaching and sensitive data systems. Media reports indicate a similar effort may be underway at the Department of Education.”

“We will not stand by and allow this to happen to the nation’s students, parents, borrowers, educators, and communities. Congress created the Department to ensure all students in America have equal access to a high-quality education and that their civil rights are protected no matter their zip code,” continued the lawmakers. “We urge you to provide information on the steps the Department is taking to ensure the continuity of programs that Americans depend on, the ability of the Department to effectively administer programs for their intended purposes without waste, fraud and abuse, and the safeguards in place to protect student data privacy.”

The lawmakers note that Trump and Elon Musk have not shared any plans regarding intended changes to the Department of Education with the Congressional committees responsible for its oversight and funding. In their letter, they request information about access to the Department’s sensitive data and steps taken to safeguard it, communications and details regarding Department employees who have been placed on leave and confirmation that no awards have been blocked or terminated.

The full letter is available HERE.

MIL OSI USA News –

February 7, 2025

MIL-OSI New Zealand: Minister thanks outgoing Chief Executive

Source: New Zealand Government

Health Minister Simeon Brown has today thanked outgoing Health New Zealand Chief Executive Fepulea’i Margie Apa for her service.

“Margie Apa was the first to hold the position of Chief Executive at Health New Zealand, taking on the challenge of transitioning New Zealand’s health system from regional district health boards into a single entity following the previous government’s reforms in the middle of a pandemic.

“Prior to this, Margie was Chief Executive of the Counties Manukau District Health Board, having built a career in public service.

“As Chief Executive at Health New Zealand, Margie remained committed to ensuring access to healthcare services while Health New Zealand grappled with significant operational and financial challenges stemming from the health system reforms.

“I acknowledge Margie’s decision to step down as Chief Executive of Health New Zealand and thank her for her service,” Mr Brown says.

Dr Dale Bramley will become acting Chief Executive of Health New Zealand, while a formal recruitment process is underway to find Ms Apa’s replacement.

“I look forward to working with Dr Bramley to ensure Health New Zealand focusses on its core role of ensuring access to timely, quality healthcare for all New Zealanders.”

MIL OSI New Zealand News –

February 7, 2025

MIL-OSI USA: Three New Locations Selected for $200M ON-RAMP Program

Source: US State of New York

Governor Kathy Hochul today announced that the Capital Region, Finger Lakes and Mohawk Valley have been selected to advance to the planning stage of the $200 million One Network for Regional Advanced Manufacturing Partnerships (ON-RAMP) program. The regions join Central New York, in which Syracuse was established as the program’s flagship location, and will create a network of high-impact workforce development centers to connect New Yorkers with careers in dynamic, high-growth advanced manufacturing industries. These workforce centers will equip New Yorkers with the skills they need and create an “on-ramp” to training, internships, apprenticeships and permanent employment and capitalize on the State’s success in attracting and expanding advanced manufacturing companies such as Micron and GlobalFoundries.

“Too many communities in Upstate New York have been left out and left behind for generations – and I’m fighting to bring them back,” Governor Hochul said. “These new ON-RAMP centers will be critical parts of the new I-90 advanced manufacturing corridor, giving New Yorkers the skills and training necessary for a good-paying job. New Yorkers are already seeing the benefits of our economic development strategy: good-paying jobs, revitalized communities and more money in their pockets.”

First proposed in Governor Hochul’s 2024 State of the State, ON-RAMP, which is managed by Empire State Development, was included in the FY25 Enacted Budget with the goal of establishing four new advanced manufacturing workforce development centers. The three regions announced today will receive up to $300,000 in planning grants to develop detailed road maps to establish the new ON-RAMP centers. Upon completion of a business plan, each center will receive up to $40 million in implementation funding.

Training provided through ON-RAMP will be based on the highly successful model developed by the Northland Workforce Development Training Center located in Buffalo. Northland employs a model that is designed to reduce all the major barriers that prohibit students from enrolling and completing post secondary education such as transportation, childcare, academic readiness and affordability. These three centers will combine industry, academia, social services, organized labor and community organizations to provide high quality, in-demand training and the wraparound support necessary to remove these common barriers and empower more New Yorkers with the skills needed for careers in high growth advanced manufacturing industries. Each designee will spend the coming months in a planning phase where they will undertake a comprehensive community and stakeholder engagement process to develop a detailed blueprint for each center.

Capital Region

The Center for Economic Growth (CEG) will lead the Capital Region’s ON-RAMP center, with a proposed primary location offering technical training, non-technical foundational and soft skills and critical wraparound services. CEG will lead the regional consortium of industry partners, including GlobalFoundries, Plug Power, General Electric, NSH USA, P1 Industries and Regeneron, plus local trades and workforce training providers. Regional manufacturing employment is at a 22-year high, driven by semiconductor, energy and biotech industry growth, and several major pending construction projects will require a skilled trades pipeline. The Capital Region proposal recommends the adaptive reuse of a now-vacant building on former College of Saint Rose campus, which serves as a centralized location among Albany neighborhoods and provides direct CDTA Bus Rapid Transit access.

Finger Lakes

Monroe Community College will lead the Finger Lakes ON-RAMP center in partnership with RochesterWorks. The proposed center includes a flagship location at the Finger Lakes Workforce Development Center located on Monroe Community College’s downtown Rochester campus. The center will train future employees in advanced manufacturing, semiconductor development and manufacturing, robotics, electronics, smart technologies, associated skilled trades, clean energy manufacturing and other high-demand skills to support regional employers. Potential consortium partners include major employers like Plug Power, Optimax, Akoustis, Coach, G.W. Lisk, BMP, ARP, Edwards Vacuum, Barilla America and Bausch & Lomb, along with local training and service providers. The consortium will leverage partnerships among Monroe Community College, Finger Lakes Community College, Genesee Community College and regional Workforce Development Boards to create an integrated training network.

Mohawk Valley

Mohawk Valley Community College will lead this regional ON-RAMP center by redeveloping the soon to be vacant Science and Technology building at MVCC’s Utica campus. The new facility is strategically located near major employers Danfoss, Indium and Wolfspeed, across the street from the city’s high school and directly adjacent to a high-diversity neighborhood. The center will offer training for in-demand skills on low-cost, no-cost, and work-and-learn models; retention strategies to engage marginalized and underserved populations and support completion; and employer integration to facilitate direct job placement. MVCC will lead a consortium of six core organizations with a proven track record of workforce innovation. MVCC’s Free Fast Track program and MACNY’s Real-Life Rosies and Advanced 2 Apprenticeship Programs, both successful direct placement programs, will be housed at the ON-RAMP center and provide additional capacity for these programs to increase enrollment.

These new ON-RAMP centers will be critical parts of the new I-90 advanced manufacturing corridor, giving New Yorkers the skills and training necessary for a good-paying job.

Governor Kathy Hochul

Empire State Development President, CEO and Commissioner Hope Knight said, “By adding centers in the Capital Region, Mohawk Valley and Finger Lakes to connect with Central New York, the ON-RAMP network will connect New Yorkers to new opportunities all along the upstate semiconductor corridor. Today’s announcement represents our latest investments in workforce training under Governor Hochul, and supports our continued efforts to reshore manufacturing jobs and build out the advanced manufacturing ecosystem.”

New York State Department of Labor Commissioner Roberta Reardon said, “We must equip our workforce with the necessary skills to support New York’s rapidly expanding advanced manufacturing sector. By offering comprehensive training and wraparound services, this program offers New Yorkers across the state a pathway to well-paying careers now and for years to come. I applaud Governor Hochul for her continued investments in our workforce as we work to build the New York of tomorrow.”

Center for Economic Growth President and CEO Mark Eagan said, “ON-RAMP ensures that people living in our communities have robust support, including stipends, childcare, and transportation to access training and ultimately a career in manufacturing. CEG is proud to act as the project lead on behalf of a regional consortium of more than 60 initial partners to build a seamless network of workforce training and service providers to connect individuals with in-demand jobs at high-growth manufacturers. Thank you, Governor Hochul, for your leadership in growing New York State’s advanced manufacturing workforce.”

Monroe Community College President Dr. DeAnna R. Burt-Nanna said, “Monroe Community College has a long history of sustaining public trust as an exemplary leader in workforce development. MCC and the Finger Lakes Workforce Development Center stand ready to create the conditions for the entire Finger Lakes region to showcase its preparedness to uplift the lives of even more New York citizens. We look forward to working with a network of workforce development and training entities, like RochesterWorks, committed to preparing New Yorkers for careers in high-growth industries and leading collaboration to build the overall Upstate NY workforce development ecosystem.”

Mohawk Valley Community College President Dr. Randall VanWagoner said, “We are so grateful to the Governor and her staff for this incredible opportunity to work even more closely with our workforce partners in the region to significantly scale opportunities that connect people to quality jobs and enhance the overall vibrancy of the communities we serve.”

CenterState CEO President Robert Simpson said, “The need for talent continues to accelerate as we prepare for historic investments from Micron and other companies looking to expand operations in New York State. We are grateful for Governor Hochul’s leadership and vision as we partner to establish a critical new network of workforce development centers. ON-RAMP will help connect New Yorkers from priority populations with careers in high growth industries like manufacturing and construction. Across New York state these centers will both serve as state-of-the-art training facilities and as catalysts for the redevelopment of strategic, high-impact corridors.”

State Senator Sean Ryan said, “We know that funding workforce development programs like ON-RAMP is one of the most effective investments we can make in New York’s economy. Providing more technical and career education throughout our state will set more workers up for success and ensure we have the well-trained workforce we need to attract and sustain manufacturing jobs.”

Assemblymember Al Stirpe said, “The expansion of New York’s advanced manufacturing sector continues to highlight the urgent need to provide our Upstate workforce with the skills necessary for success. By extending workforce development through new ON-RAMP centers in the Capital Region, Finger Lakes, and Mohawk Valley, we can reach more underserved communities, offering the wraparound supports that increase the number of skilled workers while helping to break the cycle of generational poverty. I’m proud of Governor Hochul’s continued commitment, especially with the focus on creating a vital I-90 advanced manufacturing corridor. With Micron’s presence in Central New York and other major players like GlobalFoundries, this investment in workforce training ensures our region remains competitive and prepared for future opportunities in advanced manufacturing.”

Assemblymember Harry Bronson said, “I am proud to say that thanks to the advocacy and partnership of my colleagues in the Greater Rochester Majority Delegation, as well as local officials, the Governor has identified the Finger Lakes Region as one of the high-impact, strategic locations for a new ON-RAMP workforce development training center. Workforce development is one of the most important tools for building the middle-class and addressing affordability for all our families. In addition, it will help us effectively reduce poverty in New York State and uplift our families, especially when paired with ON-RAMP’s strategy to address other barriers to employment such as transportation, childcare, education and more by providing wraparound services alongside job training. With these investments we are well on our way to building a more equitable and diverse New York economy. Thank you, Governor Hochul, for your leadership.”

Embedded Flickr Album

Today’s announcement complements New York State’s investments in workforce development. In 2022, Governor Hochul reimagined the state’s approach to workforce development and established the Office of Strategic Workforce Development at ESD, which supports industry-driven workforce development programs and practices to ensure New Yorkers are prepared to meet the needs and priorities of employers. To date, more than $63 million has been awarded, leveraging more than $69 million in public and private funding, to support nearly 15,000 trainees for over 2,000 business partners.

The announcement also complements the state’s investments to build a modern economy in New York by growing a dynamic and innovative semiconductor industry. In 2022, the Governor signed New York’s historic Green CHIPS legislation to make New York a hub for semiconductor manufacturing, creating 21st century jobs and kick-starting economic growth while maintaining important environmental protections. As part of the FY24 Enacted Budget, Governor Hochul secured a $45 million investment to create the Governor’s Office of Semiconductor Expansion, Management, and Integration (GO-SEMI), which leads statewide efforts to develop the chipmaking sector. In December 2023, Governor Hochul announced a $10 billion public-private partnership — including $9 billion in private investment from IBM, Micron, Applied Materials, Tokyo Electron and other semiconductor leaders — to bring the future of advanced semiconductor research to New York’s Capital region by creating the nation’s first and only industry accessible, High NA EUV Lithography Center at the Albany NanoTech Complex which has been recently awarded $825 million in federal funding and was designated the CHIPS for America EUV Accelerator under the CHIPS and Science Act.

In the last two years, chip companies have announced more than $112 billion in planned capital investments in New York — more than any other state — and one in four U.S.-made chips will be produced within 350 miles of Upstate New York. No other region in the country will account for a greater share of domestic production.

Build the Workforce of Tomorrow

As a part of her 2025 State of the State, Governor Hochul proposed making community college free for students ages 25-55 pursuing select associate degrees in high-demand occupations, including nursing, teaching, technology, engineering and more. Additionally, the State will cover the costs of tuition, books and fees for participants in this program and will increase funding for career support infrastructure to connect students with job opportunities. Governor Hochul also proposed providing funding for providers of registered apprenticeships and pre-apprenticeships in the high-demand occupations, to cover partial apprentice wages, training costs, and for underrepresented groups, wraparound services. Additionally, the Governor proposed to reform the way executive agencies hire cybersecurity and technology talent by removing four-year degree requirements for many entry-level and early-career positions, and to create a cybersecurity fellows program with SUNY and CUNY community colleges that places graduates in two-year jobs in state government. Governor Hochul will also work with private companies to similarly reduce or remove certain educational requirements to create more entry points for New Yorkers graduating from community and technical colleges.

Renew Our Commitment to Our State’s Capital City

The FY 2026 Executive Budget launched an inclusive, State-led initiative to invest $400 million to revitalize the downtown core of Albany—in partnership with local stakeholders and backed by significant State resources to catalyze change. This investment includes $200 million to make real investments into tangible strategies and projects to revitalize Albany, such as: targeted strategies that address public safety and quality of life; revitalizing vacant or dated anchor institutions; reinvigorating commercial corridors; repurposing vacant and underutilized commercial buildings for housing and other new uses; leveraging open spaces and key public assets; coordinating with ongoing planning efforts related to the redevelopment of I-787 and the Livingston Avenue rail bridge; and creating new reasons to work, visit, or live in downtown Albany. This historic investment also includes $150 million to renovate the New York State Museum and upgrade the exhibits to be more inviting to visitors, including families, as well as funding for the State to temporarily supplement Albany’s public safety efforts by offering enhanced State Police resources to reduce crime and increase community policing in key corridors.

Informed by conversations with local stakeholders, the Governor’s commitment to Albany will play out through a comprehensive community engagement process with the public, elected representatives, and community leaders to identify key opportunities to promote business development, bolster public safety, build out community anchors, encourage housing, and enhance affordability.

MIL OSI USA News –

February 7, 2025

MIL-OSI Economics: Lessons learned and challenges ahead for central banks in the Americas

Source: Bank for International Settlements

Introduction

Welcome, everyone, and thank you for attending the first edition of the Chapultepec Conference. The aim of this event is to allow central bank Governors to reflect and share perspectives on the major economic and financial issues facing the Americas. I am sure that today’s meeting will be followed by many others.

Today’s conference has a rich agenda. We started this morning by discussing global financial conditions and digital innovations. After lunch, we will turn to monetary policy.

I will use my time today to give some background to this afternoon’s discussions. I will aim to provide some perspective on the course of monetary policy in the Americas over the past few years. I will then turn to what I see as the key challenges facing central banks in the region in the coming years. My comments will focus on Latin America, although many of the themes have broader relevance.

Latin America’s response to the Covid crisis

Monetary policy developments in recent years have been profoundly shaped by the events of the Covid-19 pandemic and its immediate aftermath.

When the pandemic struck in 2020, central banks throughout the world took decisive measures. They lowered interest rates to record lows, offered new liquidity facilities and expanded existing ones. Many central banks also made asset purchases.

For advanced economy central banks, including the Federal Reserve and the Bank of Canada, the policy response followed a broadly familiar playbook, although the size of the response was unusually large.

But for many emerging market economy central banks, including those in Latin America, such a strong, countercyclical policy response marked a departure. In past crises, policy had often responded procyclically, not least due to concerns about possible currency depreciation.

Two factors contributed to this different response in Latin America during the pandemic. First, monetary policy frameworks in Latin America had been strengthened over the previous decades. In particular, the autonomy obtained in the 1990s was a rock-solid foundation, without which a countercyclical policy response would not have been possible. Second, the pandemic was a global shock. The fact that central banks worldwide, including the Federal Reserve, were loosening their policy stances no doubt made it easier for central banks in Latin America to follow suit.

While the policy easing at the start of the pandemic was highly synchronous, the tightening in its aftermath was less so. Central banks in Latin America, in particular, were relatively quick to unwind emergency policy settings in response to emerging inflationary pressures in early 2021. In doing so, they drew on the experiences of the 1970s and 1980s, when high inflation and wage-price spirals were prevalent. Monetary policy in advanced economies was, in my view, more heavily influenced by the extended period of below-target inflation that preceded the pandemic.

Early and forceful policy tightening worked. By slowing demand, it contributed directly to lowering inflation. Just as importantly, decisive tightening helped keep long-term inflation expectations anchored. Even when inflation initially rose, the public never lost confidence in central banks’ commitment and ability to bring inflation back to target. In countries with a history of high and volatile inflation, like many in Latin America, this is a clear success. It has helped to prevent a wage-price spiral similar to that experienced during previous episodes. Moreover, unlike in many episodes of the 1980s and 1990s, there was no financial or banking crisis.

The job is not done, however. In much of the Americas, inflation remains above target. And the road back to price stability looks bumpier than it did even six months ago, not least due to heightened policy uncertainty. Over the past few years, central banks were able to draw on their accumulated credibility to limit the rise in inflation and bring it down at relatively little cost to economic activity. But to safeguard their credibility for the future, they have to see the job through and deliver on their mandates.

Challenges ahead

Let me spend the rest of my speech discussing some of the challenges that I believe will affect the conduct of monetary policy in the coming years.

The first challenge is policy uncertainty. Trade policy is the most prominent example. But the future evolution of fiscal policy, regulation and immigration policy is also open to many questions at present. Moreover, the geopolitical backdrop remains in flux.

Such pervasive policy uncertainty will affect central banks in several ways.

Uncertainty itself is likely to weigh on growth. Firms will postpone investment. Households may avoid large purchases. In isolation, these effects would weigh on inflation.

But an uncertain world is also likely to be a more volatile one, particularly for financial markets. Already in recent weeks, we have seen sizeable swings in asset prices, including exchange rates, as market participants struggled to determine how policy settings would evolve, and how to position themselves accordingly. Some of these asset price movements, particularly exchange rate depreciations, could be inflationary.

At some point, of course, many of today’s policy uncertainties are likely to be resolved. Depending on the policies adopted, these choices will have their own consequences for growth and inflation.

The second challenge is high public debt and, in some countries, unsustainable fiscal positions. Public debt was already high in much of the world before the Covid-19 pandemic. It has increased further since then. And the widening of budget deficits at the start of the pandemic has still not been fully unwound.

Loose fiscal policy complicates the task of central banks in several, well known, ways. By contributing to aggregate demand, it adds to inflationary pressures, complicating the return to price stability. By raising doubts about the long-term sustainability of public finances it can increase interest rate risk premia and can lead to currency depreciation, further raising inflation while weighing on growth. In the extreme, an abrupt repricing of public debt could put financial stability at risk, especially in countries where banks and non-bank financial institutions hold large shares of the public debt. But even if these channels are familiar, central banks will still need to navigate the consequences.

The third challenge is international divergence. As I mentioned before, the pandemic was a global shock, leading almost all central banks to ease policy at about the same time. The subsequent inflationary outbreak saw most tighten policy, even if many emerging market economy central banks started to do so ahead of their advanced economy peers.

Going forward, economic conditions, and hence appropriate policy settings, are likely to be less synchronous. In particular, economic growth in the United States has been much stronger than in much of the rest of the world of late. Should this continue, we could see greater variability in policy settings, with flow-on effects to capital flows, exchange rates and global financial conditions.

A fourth, and related, challenge is continued sluggish productivity growth in most countries of the Americas, except the United States. Some factors behind this problem are insufficient investment in infrastructure, education and technology. Many countries face structural inefficiencies, such as rigid labour markets and bureaucratic hurdles, which hinder businesses’ ability to innovate and expand. A retreat from globalisation and widening trade fragmentation could weigh on productivity growth further.

Low productivity growth makes central banks’ lives much harder. In particular, it creates pressure to keep policy settings loose in order to sustain economic growth in the face of weak fundamentals. I don’t need to tell this audience that this policy prescription is all wrong.

Addressing low productivity growth requires structural reforms that make it easier to open a business, compete and invest. Regrettably, structural reforms had been lagging in many economies well before the pandemic. Consolidating fiscal positions and rationalising public expenditure may also free up resources to improve public investment to develop necessary infrastructure and improve human capital. Such policies, of course, lie outside central banks’ toolkit.

The task for central banks

Faced with all of these challenges, many of which are beyond their control, what can central banks do?

A first task is to ensure that at least one key prerequisite for sustained economic growth – price stability – is beyond question. In doing so, they can help remove one potentially destabilising source of policy uncertainty. The history of this region regrettably features many examples of the adverse consequences when the public loses confidence in central banks’ ability and willingness to achieve their mandates. The experience of the Covid pandemic showed us how much better outcomes can be if such confidence is maintained.

That said, the specific policy settings to deliver monetary and financial stability are themselves uncertain. Much will depend upon how policy uncertainty evolves, and on the specific constellation of policies that are ultimately adopted. Appropriate policy settings will also change over time. In the meantime, bouts of market volatility are likely. At such times, central banks may need to act, in a judicious and limited manner, to safeguard market stability.

So central banks will need to remain on their toes, be attuned to recent developments and stand ready to act firmly and decisively when required. While central banks’ ultimate objectives – monetary and financial stability – should be steadfast, commitment to specific policy settings should be avoided. Maintaining flexibility to adjust policy settings rapidly in response to changing circumstances will be at a premium.

Beyond the immediate conjuncture, I believe the time is also opportune for central banks to build on the lessons of the past few years, in order to better prepare themselves for the future. The policy reviews currently being undertaken in a number of economies represent such an opportunity.

In particular, a key lesson that I draw is how quickly and fundamentally seemingly pervasive features of the economic landscape can change. Before the pandemic, there was broad-based agreement that the global economy would face strong deflationary pressures for the foreseeable future. Real rates were expected to remain at historical lows, raising the risk of persistent liquidity traps.

Today it is clear that inflation risks are much more two-sided than we had previously thought. And it is also clear that the general public is much more resentful of even a relatively brief period of high inflation than a prolonged period of modestly below-target inflation. Our policy frameworks should take these lessons into account. But they will also need to be robust to a future that could look very different from even the immediate past. A key reason for the success of many Latin American central banks in navigating the post-pandemic inflation surge was their ability to adapt rapidly in the face of changing circumstances. Such adaptability is a trait to which all policy frameworks aspire.

Let me close with a plea for central bank cooperation. Central banking is not a zero-sum game. Above-target inflation or low growth in one country does not benefit others, but makes their life more difficult. This means there is significant scope for cooperation. It will be much easier to meet the challenges of tomorrow together than alone.

The BIS will be there to support you in this endeavour. The BIS’s mission is to support central banks’ pursuit of monetary and financial stability through international cooperation, and to act as a bank for central banks. The BIS Representative Office for the Americas will continue to promote cooperation among central banks in the Americas and the Caribbean and to link central banks in the region to those in other regions.

MIL OSI Economics –

February 7, 2025

MIL-OSI New Zealand: Independent arbiter to determine torture redress

Source: New Zealand Government

The Government has appointed Hon Paul Davison KC as an independent arbiter to determine financial redress for survivors tortured at the Lake Alice Psychiatric Hospital Child and Adolescent Unit (the Lake Alice Unit).

In December, Cabinet set aside up to $22.68 million for redress for torture which consists of three components; a one-off payment which recognises an individual’s experience of torture as a child, a new written apology which explicitly acknowledges torture, and facilitating access to support and rehabilitative services.

Eligible survivors can choose either an expedited payment of $150,000 or an individual payment process where each claim is independently assessed by an independent arbiter who will determine payment amounts.

Hon Paul Davison KC is a retired judge of the High Court who also sat as a member of a Divisional Court of Appeal. He retired from the High Court in August 2023 and has since resumed practice at the Bar as a mediator and providing litigation and consultancy advice. In 1983, Hon Davison was the Counsel Assisting the Committee of Inquiry into Oakley Hospital that investigated the death of a patient following the administration of ECT. The Chair of the Committee of Inquiry was Sir Rodney Gallen who was later appointed to oversee the distribution of $6.5m to survivors of the Lake Alice in what is known as the first-round settlement.

“We wanted to ensure people have choice when going through this process. The individualised option allows survivors to opt for a payment that considers their personal experiences of torture at the Lake Alice Unit. Guided by terms of reference, Hon Davison KC will independently assess the claims of those who choose this pathway. I would like to thank him for his willingness to undertake this important role,” Lead Coordination Minister Erica Stanford says.

So far 77 survivors of the Lake Alice Unit have been confirmed as eligible to make their claim for redress. Survivors will have until 30 April 2025 to choose the individual payment process and until 30 September 2025 for the expedited pathway.

Payments for the expeditated process will begin in March, both processes will be complete by the end of 2025. All eligible survivors can access free independent legal advice to support them during this process.

Notes to editors:

Hon Paul Davison KC’s appointment will commence on 10 February 2025 and will end no later than 30 September 2025.
Payments will be made on a final settlement basis and will be exempt from being treated as income and will not affect the recipient’s tax-status or their entitlement to Ministry of Social Development (MSD) administered assistance.

MIL OSI New Zealand News –

February 7, 2025

MIL-OSI USA: NASA’s Ethics Program

Source: NASA

NASA’s Ethics Program provides training and counsel to NASA employees and is responsible for the day-to-day management of the agency-wide ethics program. Headquarters and Center Chief Counsels ethics officials support the ethics program in their respective localities.
A list of ethics officials at each NASA location can be found here: Headquarters and Center Ethics Officials.
Associate General Counsel, General Law Practice Group:Katie Spear
Agency Counsel for Ethics:Adam Greenstone

NASA employees have a responsibility to the United States Government and its citizens to place loyalty to the Constitution, laws, and ethics principles above private gain. As NASA employees, we need you to preserve NASA’s core value of integrity through your commitment to ethics and ethical decision-making. If you are faced with a question concerning your ethics obligations as a NASA employee, please contact a NASA ethics official before taking action.
Contact Information
What are your obligations? Know the rules. If you have questions, please ask an ethics official at your respective center.

As a NASA employee, you may be required to disclose your financial interests for one of two reasons: 1) You are in a position requiring by law that you file a Public Financial Disclosure (OGE Form 278)(PDF) report. This includes members of the Senior Executive Service (SES); SL or ST employees; holding another position classified above the GS-15 level; holding a “NASA excepted” position above a certain pay level; and Schedule C appointees. 2) Your duties are such that they raise an increased likelihood of a conflict of interest, for which you would file an (OGE Form 450)(PDF) report. If you are in a position subject to Public Financial Disclosure (or acting in one for more than 60 days), then you are subject to the Public Financial Disclosure report in which your report will be publicly available. If you are a General Schedule or other employee required to file OGE Form 450, your financial disclosure requirements will be less complex, and report will be confidential. For specific questions, please contact an ethics official.

Please click here to access the latest Widely Attended Gatherings Determinations. If you do not see a determination for the event in which you were invited to attend in your official capacity, please request guidance from your local ethics official.

NASA employees are subject to regulations regarding outside employment. They are prohibited from engaging in outside activities that conflict with their official duties. In addition, the NASA Supplemental Standards of Ethical Conduct for NASA Employees, 5 C.F.R. Part 6901, require prior approval for engaging in certain types of outside employment. In these instances, employees should request approval from their local ethics official prior to accepting such outside employment.
Note that the NASA Supplemental rules also prohibit NASA employees from engaging in outside employment with a NASA contractor, subcontractor, or grantee in connection with work performed by that entity for NASA; or a party to a Space Act Agreement, Commercial Launch Act agreement, or other agreement to which NASA is a party pursuant to specific statutory authority, if the employment is in connection with work performed under that agreement.
Employees in a leave status are subject to the same legal parameters.
Please reach out to your local ethics official for guidance.
Resources

We look forward to welcoming you to NASA! You are joining an organization that works to change the history of humanity and usher in a bold new era or discovery. We are depending on you to maintain the public trust and to preserve NASA’s ethical culture. Accordingly, NASA employees must comply with ethical standards that relate to outside employment, political activities, and business relationships, among other topics. NASA encourages prospective employees to learn more about these ethical standards along the path of joining our team. If ethics questions arise before or after you join NASA, please contact a NASA ethics official before taking action. What are your obligations? Know the rules. If you have questions, please ask an ethics official at your respective location.

As a NASA employee, you may be required to disclose your financial interests for one of two reasons: 1) You are in a position requiring by law that you file a Public Financial Disclosure (OGE Form 278)(PDF) report. This includes members of the Senior Executive Service (SES); SL or ST employees; holding another position classified above the GS-15 level; holding a “NASA excepted” position above a certain pay level; and Schedule C appointees. 2) Your duties are such that they raise an increased likelihood of a conflict of interest, for which you would file an (OGE Form 450)(PDF) report. If you are in a position subject to Public Financial Disclosure (or acting in one for more than 60 days), then you are subject to the Public Financial Disclosure report in which your report will be publicly available. If you are a General Schedule or other employee required to file OGE Form 450, your financial disclosure requirements will be less complex, and your report will be confidential. For specific questions, please contact an ethics official.
Resources

The post-government employment ethics statute, 18 U.S.C. § 207, applies to a former NASA employee’s communication with NASA or the Government on behalf of the former employee’s non-federal employer. Former NASA employees should contact a NASA ethics official for advice before communications or otherwise interacting with NASA or the Government on behalf of their new employer because this criminal statute may be implicated. The Procurement Integrity Act also restricts individuals who were in certain contracting roles from accepting compensated work from certain contractors for a limited period.
Contact Information
If you have questions, please ask an ethics official at your respective center.

A Special Government Employee (SGE) is an officer or employee “who is retained, designated, appointed, or employed to perform, with or without compensation, for not to exceed one hundred and thirty days during any consecutive period of three hundred and sixty-five consecutive days.” 18 U.S.C. § 202. Congress created the SGE category in 1962 to allow the federal Government to obtain the expertise it needs, while allowing experts to continue their private professional lives. As a result, some of the ethics statutes and regulations apply differently to SGEs than they do to regular executive branch employees, and some provisions do not apply at all.
Financial Disclosure
SGEs are required to file a financial disclosure report each year, usually a confidential financial disclosure report (OGE-450). Financial disclosure reporting helps NASA identify any possible financial conflicts of interest. SGEs are notified in advance of when to file.

Ethics Training
SGEs are required to receive annual ethics training by December 31st of each calendar year.
Contact Information
If you are a SGE and have questions, please contact the Headquarters Ethics Team by e-mail at hq-ethicsteam@nasa.gov or by phone at (202) 358-0550.
Resources

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Office of the General CounselNASA Headquarters300 E Street SW Suite 9V30Washington, DC 20546Phone Number (202) 358-2450

OGC Disclaimer: The materials within this website do not constitute legal advice. For details read our disclaimer.

MIL OSI USA News –

February 7, 2025

MIL-OSI Economics: Thales celebrates 40 Years of excellence and commitment in Central America and the Caribbean, serving clients and partners

Source: Thales Group

Headline: Thales celebrates 40 Years of excellence and commitment in Central America and the Caribbean, serving clients and partners

06 Feb 2025

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Thales, a global leader in advance technologies, is proud to celebrate 40 years of presence in Central America and the Caribbean. Since its arrival in the region, Thales has been contributing to the development of key sectors such as Defence, Aerospace, Cyber & Digital from 1985 until today, and continues to support all clients, such as government entities, private institutions and cities.

Thales’ presence in Central America and the Caribbean has been fundamental and has evolved significantly over the years, establishing the Group as a key player in various sectors. Among the most notable projects, Thales has been a long-term partner to COCESNA (Central American Corporation for Air Navigation Services) for over 25 years, playing a crucial role through the provision of advanced technologies and innovative solutions for air traffic management.

Thales’ collaboration with COCESNA reflects a long-term partnership based on trust and technical excellence, aimed at improving the safety and efficiency of aviation in the Central American region. In 2024, Thales secured a significant contract that reflects the trust and support placed in the company by this client, aimed at enhancing critical aviation systems in six Central American countries: Belize, Guatemala, Costa Rica, Honduras, El Salvador, and Nicaragua.

In Panama, for over 10 years, Thales has been the main supplier to the Civil Aviation Authority, providing both air traffic control centers and essential navigation systems for the safe and efficient operation of flights. Additionally, Thales has implemented various technology systems for Copa Airlines, including advanced solutions onboard its fleet of aircraft and for the protection and secure management of its data.

In the Dominican Republic, Thales maintains a continuing partnership with the Dominican Institute of Civil Aviation, being the main supplier of the control tower and air navigation systems for Las Américas, Punta Cana, Puerto Plata, and Cibao airports to ensure that each flight is a safe experience.

Thales is also a strategic partner of the Government of Jamaica, providing advanced solutions and technologies for national security, supporting the Armed Forces in their mission to strengthen national defense with the Bushmaster armored vehicle fleet and the coastal surveillance system for the safety and management of maritime areas. Thales also supports the Jamaica Civil Aviation Authority with radar systems and control centers for efficient surveillance and management of its airspace. In the country, Thales also developed the National Identification System, improving public services and security through the precise identification of each citizen, enhancing the country’s security and efficiency.
Thales is a leader in Cyber and Digital in the region and a strategic partner of leading banks and financial institutions, ensuring the security of their banking transactions by providing robust solutions that protect both information and financial operations, contributing to strengthening trust in the financial ecosystem.
Throughout this journey, Thales has forged alliances with governments, businesses, and organizations, creating a collaborative ecosystem that enhances technological and business development. It has adapted to local markets and the unique needs and challenges of the region, offering solutions that address every requirement.

“We are excited to celebrate this important milestone in our journey in Central America and the Caribbean. This achievement reinforces Thales’ strong commitment to supporting the region in its crucial moments. We drive its technological transformation and strengthen its future with advanced security solutions, ranging from coastal surveillance and border security systems to urban protection, cybersecurity, critical infrastructure, and specialized solutions for airports and airlines” said Ariane Andreani, Country Director of Thales for Central America and the Caribbean.

“Our commitment to local presence, innovation, and continuous improvement has been key to successfully serving our clients and partners. We thank them for their support over the years and are committed to continuing to build together in the years to come” she added.

About Thales

Thales (Euronext Paris: HO) is a global leader in advanced technologies specialized in three business domains: Defence, Aerospace, and Cyber & Digital. It develops products and solutions that help make the world safer, greener and more inclusive. The Group invests close to €4 billion a year in Research & Development, particularly in key innovation areas such as AI, cybersecurity, quantum technologies, cloud technologies and 6G. Thales has close to 81,000 employees in 68 countries. In 2023, the Group generated sales of €18.4 billion.

CONTACTO DE PRENSA:

Julieta Martellotta

External Communications Manager Thales LATAM

julieta.martellotta@thalesgroup.com

+5491158010260

MIL OSI Economics –

February 7, 2025

MIL-Evening Report: Do investment tax breaks work? A new study finds the evidence is ‘mixed at best’

Source: The Conversation (Au and NZ) – By Kerrie Sadiq, Professor of Taxation, QUT Business School, and ARC Future Fellow, Queensland University of Technology

The Reserve Bank of Australia (RBA) released a discussion paper this week on investment tax breaks. The study looks at whether tax incentives, such as instant asset write-offs for utes, boost business investment.

Business investment is an important contributor to overall economic growth, and has been sluggish in recent years.

The authors conclude the evidence for these tax breaks is “mixed at best”. They say that income tax breaks used during the global financial crisis increased investment significantly, however:

[there is] no substantial evidence that other policies, including those implemented during the pandemic, increased investment.

In an election year, further promises of tax breaks for businesses are likely. The Coalition has already announced a tax break for meals and entertainment. But are they a good idea, and at what cost do these promises come?

Small business in Australia

Small businesses with fewer than 20 employees make up 97% of all Australian businesses. More than 92% of Australian businesses have an annual turnover of less than A$2 million. It is these businesses that are doing it tough.

These businesses are offered tax breaks for spending on capital assets such as equipment or vehicles. For the 2023-24 tax year, they can immediately write off the cost of eligible assets up to $20,000. In the May 2024 Budget, the government announced that the tax break would be extended to the 2024-25 tax year.

When a small business is operated as a company, the base tax rate is 25%. This effectively means that the business still contributes 75% of the cost of the asset. This requires businesses to have the cash flow to invest. Even if there is cash flow, businesses may not want to spend on large purchases.

It’s a question of trade-offs

Investment tax breaks are also costly in terms of government tax revenue. Each year, the Treasury estimates the cost of tax breaks. These tax breaks are known as tax expenditures.

For the 2023-34 tax year, the instant write-off tax break for small businesses is estimated to cost more than $4 billion by reducing taxes collected.

Tax expenditures are normally designed to offer incentives to one group of taxpayers. However, they come at the expense of broader groups of taxpayers and at a cost of lost revenue to the government. This is money that could be spent through direct spending programs.

Tax expenditures can be thought of as government spending programs hidden in plain sight.

The true cost of tax breaks

Tax expenditures play a central role in Australia’s collection of taxes and redistribution. During the pandemic, the instant asset write-off was increased to $150,000.

The current government introduced the latest instant asset write-off to improve cash flow and reduce compliance costs for small business. As the RBA discussion paper notes, these types of incentives are also designed to encourage additional business investment.

However, that study indicates this is not being achieved. They suggest the reasons may be the tax policies themselves or differences in the economic environment. Put simply, businesses may not want to invest.

If the stated benefits are not realised, the result is less tax collected. Take the $4 billion cost above. Without the incentive, the government would have an additional $4 billion to spend. The $4 billion in 2023-24 could have been directed to funding small businesses through a direct spending program.

Targeted programs

The RBA discussion paper highlights the need to determine whether investment tax breaks achieve their intended benefits. Many factors must be considered, and assessing the influence on the economy is vital.

However, evaluating these measures within the tax system means that important questions are not asked. This includes whether the benefits are distributed fairly, whether the program targets the right group of taxpayers, and whether there are unintended distorting effects.

The latest Treasury Tax Expenditures and Insights Statement provides data on 307 separate measures. This number continues to grow.

The government’s “Future Made in Australia” contains two examples. Its economic plan to support Australia’s transition to a net zero economy contains two tax incentives, one for hydrogen production and another for critical minerals.

The proposed hydrogen production tax incentive is estimated at a cost to the budget of $6.7 billion over ten years. The measure will provide a $2 incentive per kilogram of renewable hydrogen produced for up to ten years. Eligible companies will get a credit against their income tax liability.

The proposed critical minerals production tax incentive is estimated to cost the budget $7 billion over ten years. Eligible companies will get a refundable tax offset of 10% of certain expenses relating to processing and refining 31 critical minerals listed in Australia.

Support for tax breaks

Tax breaks for businesses, such as the immediate write-off, disproportionately benefit those that spend. Often, this is by design. If this is a government objective, supported by the general population, then it is viewed as a good use of public money.

The same principle applies to tax breaks in the Government’s Future Made in Australia plan. A government objective is to transition to a net zero economy. A stated priority is to attract “investment to make Australia a leader in renewable energy, adding value to our natural resources and strengthening economic activity”.

The question remains as to whether tax breaks are the best way to achieve this. The answer often changes when viewed as a direct spending program.

Kerrie Sadiq currently receives funding from the Australian Research Council. She has previously received research grants from CPA and CAANZ.

Ashesha Weerasinghe does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.

– ref. Do investment tax breaks work? A new study finds the evidence is ‘mixed at best’ – https://theconversation.com/do-investment-tax-breaks-work-a-new-study-finds-the-evidence-is-mixed-at-best-249148

MIL OSI Analysis – EveningReport.nz –

February 7, 2025

MIL-OSI Asia-Pac: Fiscal Prudence and Frugality Must Never Compromise Operational Efficiency, Says Vice-President

Source: Government of India (2)

Fiscal Prudence and Frugality Must Never Compromise Operational Efficiency, Says Vice-President

Being in Service of Bharat, Home to One-Sixth of Humanity, Is a Blessing, Says VP

Never Create Hurdles in Pension Disbursement; Have Absolute Empathy for Veterans, Says VP

Lawful Route of Integrity Is the Safest Route, Says VP

Security Is Best Assured From a Position of Strength, and Strength Is Secured By Preparation, Highlights VP

Vice President Addresses Indian Defence Accounts Service (IDAS) Probationers of 2022 and 2023 Batches

Posted On: 06 FEB 2025 8:53PM by PIB Delhi

The Vice-President of India, Shri Jagdeep Dhankhar today addressed the Indian Defence Accounts Service (IDAS) probationers of the 2022 and 2023 batches in New Delhi, saying, ““I strongly advocate that there must be meticulous, scrupulous adherence to fiscal prudence, frugality but this should not come at the cost or compromising efficiency and efficiency lies in the fiscal utilisation of resources. Financial integrity is absolute essence; it is your nectar. Financial integrity once compromised you lose it forever; you can never repair and therefore, develop a mechanism in life of happiness and satisfaction that do not measure yourself comparing those who are in private sector. You are an ancient guardian of economic discipline.”

Shri Jagdeep Dhankhar further said, “Being in service of Bharat, home to one-sixth of humanity, is a blessing. You may have, on account of your credentials, the occasion to serve in several other areas, and maybe perhaps with larger fiscal gain, but you shall never have the satisfaction that you will have now. Satisfaction to live up to our civilizational ethos of service, satisfaction to nurture our nationalism, satisfaction to serve our motherland, and satisfaction to serve in conditions that is envy of everyone.”

Being in the service of Bharat, home to one-sixth of humanity, is a blessing.

You may, on account of your credentials, have the opportunity to serve in several other areas—perhaps with greater fiscal gain—but you will never experience the same satisfaction that you do now.

The… pic.twitter.com/03X5UT9AYt

— Vice-President of India (@VPIndia) February 6, 2025

Addressing the need for respect and care for veterans, Shri Dhankhar stated, “For example, it is historical fact established, the morale of the armed forces is determined by the care we have for our veterans. If veterans are in good morale, those who serve on the frontiers or otherwise look up. And you have a deep connect with the veterans, pensioners. You will have to have absolute empathy for pensioners. Never ever create a problem in disbursement of the pension. I am so happy and delighted and I came to know about it that technological upgradation has resulted in seamless delivery with expedition. But still, there will be issues and issues are bound to be there. We will never have a system where there will be no issues interdepartmental or with pensioners. Have empathy.”

It is an established fact that the morale of the armed forces is determined by the care we have for our veterans.

You have a deep connect with the #veterans, the pensioners. They are not the people who are retired. They will never tire of serving the nation.

This blessed,… pic.twitter.com/MSLmvmm6aa

— Vice-President of India (@VPIndia) February 6, 2025

He further urged officials to treat pensioners with respect and devotion, remarking, “Act with them with a sense of devotion. All of them are like parents for you, senior citizens, our veterans. Hand-holding them, if they physically interface with you, will go a long way. Not only they will bless you, by word of mouth, a message will permeate all throughout. They are not the people who are retired. They are pensioners. They will never be tired of serving the nation in whatever form they are. This blessed, distinguished, premium category of human resource you will be interacting with.”

Speaking on financial discipline, the Vice-President cautioned against shortcuts and urged adherence to integrity. “There will always be challenges, but I can assure you lawful route of integrity is the safest route. Shortcuts are very tempting; sometimes, they are too tempting to be resisted but when challenges come, a shortcut, rather than being the shortest distance between two points, turns out to be the longest, intractable with headwinds and air pockets. Sometimes, negotiating is never-ending.”

Reflecting on the global security scenario, the Vice-President stressed that preparedness is paramount, given the challenges in the region and ongoing global conflicts. “Given the security clime in our neighborhood, given the challenges we have, and given the challenges that we are living in times where conflagration in any part of the globe—Ukraine-Russia, Israel-Hamas—we were impeccable, and therefore, the level of preparation now has become much beyond what you may be having in your mind. The good thing is that our nation is getting prepared.”

He further emphasized the importance of security from a position of strength, stating, “Security of any nation is fundamental. It is said security is best assured from a position of strength. And position of strength is secured by level of preparation. And preparation these days, you have to be ahead of times. You have to think of next-gen equipment in every field. And now the situation is so dramatically changed that conventional warfare has taken back seat.”

Highlighting the responsibilities of public servants, the Vice-President urged them to put the nation first. “While I would say always keep the nation first, have unwavering commitment to the nation, but this cannot be just an idea. While it is your ordainment by virtue of being public servants to ensure fiscal discipline, enabling operational efficiency, you also have to look around what as individuals you can do.”

The Vice-President also stressed the need for strengthening family ties, promoting indigenous knowledge, and fostering inclusivity. “One, strengthening of family ties, family values. Be connected with family. Make it a priority. Believe in environmental awareness and sustainable living. As individuals, you can contribute for it. Embrace indigenous knowledge, economic self-alliance. Be Vocal for Local. I’ll tell you, avoidable imports in this country are a huge drain on finance, to the extent of billions of dollars. And these avoidable imports are in the shape of shoes, socks, trousers, coat, shirts, carpets, furniture, toys, candles, what not. Second aspect is that when we engage into use of avoidable foreign items imported in the country, we are depriving our people of work. This small gesture you can do.”

We must focus on fostering unity and inclusivity amidst great diversity.

For 5,000 years we have had inclusivity, but the challenge to inclusivity was extreme.

Invaders came; they ravaged our culture and our religious places, but we stood our ground.

Time has come now to… pic.twitter.com/fcqkCO9smU

— Vice-President of India (@VPIndia) February 6, 2025

He concluded by emphasizing national unity and resilience, saying, “Foster unity and inclusivity amidst mass diversity. For 5,000 years we have had inclusivity, but the challenge to inclusivity was extreme. Murderers came, invaders came. They ravaged our culture, our religious places. We stood our ground. But time has come now to keep nation’s interest always first, fostering unity, fostering brotherhood.”

Shri Rajesh Kumar Singh, IAS, Defence Secretary, Smt. Devika Raghuvanshi, IDAS, Controller General of Defence Accounts (CGDA), Dr. Vandana Kumar, Additional Secretary, Rajya Sabha Secretariat and other dignitaries were also present on the occasion.

*****

JK/RC/SM

(Release ID: 2100484) Visitor Counter : 47

MIL OSI Asia Pacific News –

February 7, 2025

Category: Economy

Most olive and citrus trees are gone

In some areas, every greenhouse is gone

Agricultural attacks are unlawful

Introduction

Latin America’s response to the Covid crisis

Challenges ahead

The task for central banks

Small business in Australia

It’s a question of trade-offs

The true cost of tax breaks

Targeted programs

Support for tax breaks

Fiscal Prudence and Frugality Must Never Compromise Operational Efficiency, Says Vice-PresidentBeing in Service of Bharat, Home to One-Sixth of Humanity, Is a Blessing, Says VP

Fiscal Prudence and Frugality Must Never Compromise Operational Efficiency, Says Vice-President

Being in Service of Bharat, Home to One-Sixth of Humanity, Is a Blessing, Says VP