Bernie Blegen
Executive Vice President & Chief Financial Officer at Monolithic Power Systems
Thanks, Gen.
For the full year 2023, MPS achieved record revenue of $1.82 billion. This is our 12th consecutive year of revenue growth, driven by consistent execution, continued innovation and strong customer focus. As announced today, MPS is expanding into a new $1 billion market with the acquisition of our partner, Axign B.V. Axign is a Netherlands-based startup with early revenue specializing in programmable multicore digital signal processors. Axign's competitive difference is its ability to deliver signals with near 0 distortion and reduced power consumption for automotive and consumer audio systems. The combination of Axign and MPS' IP, which has been accepted by several high-end audio customers will change people's experience in their cars, homes, concert venues and stadiums.
Let me turn to a few highlights from this past year. Our integrated power management solutions for artificial intelligence enabled our customers to unlock previously untapped opportunities for innovation and growth. We created new automotive content, powering the ramp of autonomous driving, the digital cockpit and lighting systems for both conventional and electric vehicles. We continue to diversify our global R&D footprint with the further expansion of our engineering centers of excellence in Europe and Taiwan. And finally, we continue to expand and diversify our operating footprint with the qualification of multiple new fab and packaging partners in Taiwan, Singapore and Malaysia.
Turning to our full year 2023 revenue by market segment. Automotive revenue grew $94.6 million year-over-year to $394.7 million in 2023. This 31.5% gain was primarily driven by increased sales of our highly integrated applications supporting advanced driver assistance systems, the digital cockpit and lighting applications. Automotive revenue represented 21.7% of MPS' full year 2023 revenue compared with 16.7% in 2022. Full year 2023 enterprise data revenue grew $71.6 million over the prior year to $323 million. This 28.5% increase was primarily due to higher sales of our power management solutions for AI applications. Enterprise data revenue represented 17.7% of MPS' total revenue in 2023 compared with 14.8% in 2022. Storage and computing revenue for 2023 grew $38.5 million over the prior year to $491.1 million. This 8.5% increase was primarily driven by increased sales of products for notebooks.
Storage and computing revenue represented 27.0% of MPS' total revenue in 2023 compared with 25.3% in 2022. Communications revenue fell by $46.5 million to $204.9 million, this 18.5% reduction was a result of lower 4G and 5G infrastructure sales. Communications revenue represented 11.3% of our 2023 revenue compared with 14.0% in 2022. Industrial revenue fell by $46.5 million to $172.7 million in 2023. This 21.2% decrease primarily reflected lower sales in applications for industrial automation, security and power sources. Industrial revenue represented 9.4% of MPS' full year 2023 revenue compared with 12.2% in 2022. Consumer revenue decreased $84.8 million to $234.7 million in 2023. This 26.6% year-over-year decrease was a result of broad market weakness across all segments. Consumer revenue represented 12.9% of MPS' full year 2023 revenue compared with 17.8% in 2022.
Let me take a moment to talk about the general business conditions. Throughout 2023, we highlighted that customer ordering patterns were oscillating, reflecting general economic uncertainty. While we saw a nominal improvement in Q4 ordering patterns, we remain cautious as visibility beyond the current quarter is limited. Despite this ongoing uncertainty, we continue to execute against our long-term strategy by bringing innovative new products to market and expanding design wins across our broad base of customers. We believe these ongoing investments position us well for future growth when the macro environment stabilizes.
Switching to Q4 results. MPS had fourth quarter revenue of $454.0 million, down 4.4% from the third quarter of 2023 and down 1.3% from the fourth quarter of 2022. Comparing year-over-year results, fourth quarter 2023 revenue for enterprise data grew by 88.4%. Storage and computing fell 2.9%. Automotive was down 7.8%, Consumer decreased 17.5%, Communications decreased 36.3% and Industrial fell 40.5%. Fourth quarter 2023 GAAP gross margin was 55.3%, down 20 basis points from the third quarter of 2023 and 290 basis points below the fourth quarter of 2022. Fourth quarter 2023 non-GAAP gross margin was 55.7%, flat with the third quarter of 2023, but 280 basis points lower than the fourth quarter of 2022. This year-over-year reduction in fourth quarter non-GAAP gross margin is largely due to sales mix.
Turning to operating expenses. Our GAAP operating expenses were $141.6 million in the fourth quarter compared with $128 million in the third quarter of 2023 and $130.9 million in the fourth quarter of 2022. Our non-GAAP fourth quarter 2023 operating expenses were $96.7 million, roughly flat with the third quarter of 2023 and up from the $94.8 million reported in the fourth quarter of 2022. The differences between GAAP and non-GAAP operating expenses for the quarters discussed are primarily stock compensation expense and income or loss from an unfunded deferred compensation plan. Fourth quarter 2023 stock compensation expense, including $1.2 million charge to cost of goods sold was $41.1 million compared with $33.6 million recorded in the third quarter of 2023.
Switching to the bottom line. Fourth quarter 2023, GAAP net income was $96.9 million or $1.98 per fully diluted share compared with $2.48 per share in the third quarter of 2023 and $2.45 per share in the fourth quarter of 2022. Q4 2023 non-GAAP net income was $140.9 million or $2.88 per fully diluted share compared with $3.08 per share in the third quarter of 2023 and $3.17 per share in the fourth quarter of 2022. Fully diluted shares outstanding at the end of Q4 2023 were $48.9 million.
As for our balance sheet, as of December 31, 2023, cash, cash equivalents and investments totaled $1.11 billion compared to $1.04 billion at the end of the third quarter 2023. For the fourth quarter of 2023, MPS generated operating cash flow of about $153.3 million compared with $175.9 million in Q3 2023.
Fourth quarter 2023 capital spending totaled $13.8 million. Accounts receivable ended the fourth quarter of 2023 at $179.9 million compared with the $185.8 million reported at the end of the third quarter of 2023 and $182.7 million at the end of the fourth quarter of 2022. There were 36 days of sales outstanding across these comparable periods.
Our internal inventories at the end of the fourth quarter of 2023 were $383.7 million, down from the $397.3 million at the end of the third quarter of 2023. Days of inventory rose to 172 days at the end of Q4 2023 from 171 days at the end of third quarter of 2023. We have carefully managed our internal inventories throughout the year given the uncertainty in the market. Using next quarter revenue as a basis, inventory was 175 days at the end of the fourth quarter of 2023, down from 178 days at the end of the third quarter of 2023.
I would now like to turn to our Q1 2024 outlook. We are forecasting Q1 2024 revenue in the range of $437.0 million to $457.0 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%; total stock-based compensation expense, including associated employer taxes of $46.2 million to $48.2 million, including approximately $1.4 million that would be charged to cost of goods sold; GAAP operating expenses between $147.2 million and $151.2 million; non-GAAP operating expenses to be in the range of $101.8 million to $103.8 million. This estimate excludes stock-based compensation expense and amortization of recently purchased intangible assets, but includes litigation expense and the expense from our recent Axign acquisition.
Other income before foreign exchange gains or losses expected to range from $5.3 million to $5.7 million. Fully diluted shares to be in the range of 48.8 million to 49.2 million shares. We continue to execute the share buyback program that was announced in our Q3 '23 earnings call. Finally, I am pleased to announce a 25% increase in our quarterly dividend to $1.25 per share from $1 per share for stockholders of record as of March 29, 2024.
In conclusion, while we continue to be cautious about the near-term business conditions, we believe our long-term growth strategy remains intact, and we can swiftly adapt to market changes as they occur.
I will now open the webinar up for questions.
