Item 5. Market for Registrant’s Common Equity
Item 5.
Market for Registrant ’ s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
Common Stock Information
Our common stock is traded on the Nasdaq Global Select Market under the symbol “MPWR”.
Holders of Common Stock
As of February 22, 2024, there were 68 registered holders of record of our common stock. A substantially greater number of holders of our common stock are “street name” or beneficial holders, whose shares are held by banks, brokers and other financial institutions on their behalf.
Issuer Purchases of Equity Securities
In October 2023, our Board of Directors approved a stock repurchase program authorizing us to repurchase up to $640.0 million in the aggregate of our common stock through October 29, 2026. Shares are retired upon repurchase. We repurchased approximately 7,000 shares of our common stock for an aggregate purchase price of $3.7 million during the year ended December 31, 2023.
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 our management based on the evaluation of market conditions, legal requirements, stock price, and other factors. The repurchase program does not obligate us to purchase any particular number of shares and may be suspended, modified, or discontinued at any time without prior notice.
The following table represents details of our stock repurchase transactions during the fourth quarter of 2023:
Period
Total Number of Shares Purchased
Average Price Paid per Share
Total Number of Shares Purchased as Part of Publicly Announced Program
Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program
(in thousands, except per share amounts)
November 1, 2023 – November 30, 2023
5
$
505.65
5
$
637,465
December 1, 2023 – December 31, 2023
2
$
603.15
2
$
636,259
Total
7
$
533.45
7
Dividend Policy
We currently have a dividend program approved by our Board of Directors, pursuant to which we intend to pay quarterly cash dividends on our common stock. Based on our historical practice, stockholders of record as of the last business day of the quarter are entitled to receive the quarterly cash dividends when and if declared by our Board of Directors, which are payable to the stockholders in the following month.
The declaration of any future cash dividends is at the discretion of our Board of Directors and will depend on, among other things, our financial condition, results of operations, capital requirements, business conditions and other factors that our Board of Directors may deem relevant, as well as a determination that cash dividends are in the best interests of the stockholders.
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Stock Performance Graph
The following graph compares the cumulative five-year total return on our common stock relative to the cumulative total returns of the Nasdaq Composite Index and the PHLX Semiconductor Sector Index. An investment of $100 is assumed to have been made in our common stock on December 31, 2018, and its performance relative to the performance of a similar investment in the two indexes is shown through December 31, 2023, assuming the reinvestment of dividends. Historic stock performance is not indicative of future performance.
The information contained in this stock performance graph section shall not be deemed to be “ soliciting material, ” or “ filed ” or incorporated by reference in future filings with the SEC, or subject to the liabilities of Section 18 of the Securities Exchange Act of 1934, except to the extent that we specifically incorporate it by reference into a document filed under the Securities Act of 1933 or the Securities Exchange Act of 1934.
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Item 6.
[Reserved]
Item 7.
Management ’ s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion should be read in conjunction with the consolidated financial statements and related notes which appear under Item 8 in this Annual Report on Form 10-K. This discussion and analysis contain, in addition to historical information, forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including those set forth under “Part I, Item 1A. Risk Factors” and elsewhere in this Annual Report on Form 10-K.
Discussions of 2021 results and year-to-year comparisons between 2022 and 2021 that are omitted in this Annual Report on Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on February 24, 2023.
Overview
We are 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 are designed to 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.
We operate in the cyclical semiconductor industry. We are subject to industry downturns, but we have targeted product and market areas that we believe have the ability to offer above average industry performance over the long term. Historically, our revenue has generally been higher in the second half of the year than in the first half although various factors, such as market conditions and the timing of key product introductions, could impact this trend.
We work with third parties to manufacture and assemble our ICs. This has enabled us to limit our capital expenditures and fixed costs, while focusing our engineering and design resources on our core strengths.
Following the introduction of a product, our sales cycle generally takes a number of quarters after we receive an initial customer order for a new product to ramp up. Typical supply chain lead times for orders are generally 16 to 26 weeks. These factors, combined with the fact that our customers can cancel or reschedule orders without significant penalty to the customer, make the forecasting of our orders and revenue difficult.
We derive most of our revenue from sales through distribution arrangements and direct sales to customers in Asia, where our products are incorporated into end-user products. Our revenue from direct or indirect sales to customers in Asia was 87%, 86% and 90% for the years ended December 31, 2023, 2022 and 2021, respectively. We derive a majority of our revenue from the sales of our DC to DC converter products which serve the storage and computing, enterprise data, automotive, industrial, communications and consumer markets. We believe our ability to achieve revenue growth will depend, in part, on our ability to develop new products, enter new market segments, gain market share, manage litigation risk, diversify our customer base and continue to secure manufacturing capacity.
Macroeconomic Conditions and Recent Regulations
During 2023, the semiconductor industry faced, and continues to face, a number of macro-economic challenges including reduced consumer spending, fluctuations in demand for semiconductors, rising inflation, increased interest rates, and fluctuations in currency rates. We remain cautious in light of continued challenging macroeconomic conditions and will continue to monitor the potential impact on our operations. The extent and duration of the direct and indirect impact of macroeconomic events on our business, results of operations and overall financial position remain uncertain and depend on future developments.
We closely monitor changes to export control laws, trade regulations and other trade requirements. As of December 31, 2023 and through the date we filed this Annual Report, no existing or newly introduced restrictions have had a material impact on our revenue and operations. We will continue to monitor any changes or developments to export control laws, trade regulations and other trade requirements, or interpretations thereof and are committed to complying with all applicable trade laws, regulations and other requirements.
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Critical Accounting Policies and Estimates
Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). The preparation of these financial statements requires us to make estimates and judgments that affect the reported amount of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities. We evaluate our estimates on an on-going basis, including those related to revenue recognition, stock-based compensation, inventories, income taxes and contingencies. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making the judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Estimates and judgments used in the preparation of our financial statements are, by their nature, uncertain and unpredictable, and depend upon, among other things, many factors outside of our control, including demand for our products, economic conditions and other current and future events, such as macroeconomic factors, including the impact of the 2023 banking crisis, global economic downturn, Russia-Ukraine conflict and the Middle East conflict. Actual results could differ from these estimates and assumptions, and any such differences may be material to our consolidated financial statements. See Note 1 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K for a summary of significant accounting policies and the effect on our financial statements.
We believe the following critical accounting policies reflect our more significant judgments used in the preparation of our consolidated financial statements.
Revenue Recognition
We account for price adjustments and stock rotation rights as variable consideration that reduces the transaction price and recognize that reduction in the same period the associated revenue is recognized. Certain U.S.-based distributors have price adjustment rights when they sell our products to their end customers at a price that is lower than the distribution price invoiced by us. When we receive claims from the distributors that products have been sold to the end customers at the lower price, we issue the distributors credit memos for the price adjustments. We estimate the price adjustments using the expected value method based on an analysis of historical claims, at both the distributor and product level, as well as an assessment of any known trends of product sales mix.
Certain distributors have limited stock rotation rights that permit the return of a small percentage of the previous six months’ purchases in accordance with the contract terms. We estimate the stock rotation returns using the expected value method based on an analysis of historical returns, and the current level of inventory in the distribution channel.
Overall, our estimates of adjustments to contract price due to variable consideration have been materially consistent with actual results; however, these estimates are subject to management’s judgment and actual provisions could be different from our estimates and current provisions, resulting in future adjustments to our revenue and operating results.
Inventory Valuation
Inventories are stated at the lower of standard cost (which approximates actual cost determined on a first-in first-out basis) and estimated net realizable value. We write down excess and obsolete inventories based on their age and forecasted demand, which includes estimates taking into consideration our revenue forecast, outlook on market and economic conditions, technology changes, new product introductions and changes in strategic direction. If actual demand or market conditions are less favorable than those projected by management, additional inventory write-downs may be required. Conversely, if actual demand or market conditions are more favorable, inventories may be sold that were previously written down.
Accounting for Income Taxes
Our calculation of current and deferred tax assets and liabilities is based on certain estimates and judgments and involves dealing with uncertainties in the application of complex tax laws. Our estimates of current and deferred tax assets and liabilities may change based, in part, on added certainty, finality or uncertainty to an anticipated outcome, changes in accounting or tax laws in the U.S. or foreign jurisdictions where we operate, or changes in other facts or circumstances. In addition, we recognize liabilities for potential U.S. and foreign income tax for uncertain income tax positions taken on our tax returns if it has less than a 50% likelihood of being sustained. If we determine that payment of these amounts is unnecessary or if the recorded tax liability is less than our current assessment, we may be required to recognize an income tax benefit or additional income tax expense in our financial statements in the period such determination is made.
As of December 31, 2023 and 2022, we had a valuation allowance of $35.0 million and $20.3 million, respectively, attributable to management’s determination that it is more likely than not that certain deferred tax assets will not be fully realized. In the event we determine that it is more likely than not that we would be able to realize the deferred tax assets in the future in excess of our net recorded amount, an adjustment to the valuation allowance for the deferred tax assets would increase income in the period such determination was made. Likewise, should it be determined that additional amounts of the net deferred tax assets will not be realized in the future, an adjustment to increase the deferred tax assets valuation allowance will be charged to income in the period such determination is made.
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Contingencies
We record a contingent liability related to pending legal and regulatory proceedings when it is probable that a loss has been incurred and the amount is reasonably estimable. Based on the facts and circumstances in each matter, the determination of such liability requires significant judgment. In determining the amount of a contingent loss, we take into account advice received from experts for each specific matter regarding the status of legal proceedings, settlement negotiations, prior case history and other factors. Should the judgments and estimates made by management need to be adjusted as additional information becomes available, we may need to record additional contingent losses that could materially and adversely impact our results of operations. Alternatively, if the judgments and estimates made by management are adjusted, for example, if a particular contingent loss does not occur, the contingent loss recorded would be reversed which could result in a favorable impact on our results of operations.
Stock-Based Compensation
For equity awards with performance conditions, as well as awards containing both market and performance conditions, we recognize compensation expense when it becomes probable that the performance goals will be achieved. Management performs the probability assessment on a quarterly basis by reviewing external factors, such as macroeconomic conditions and the analog industry revenue forecasts, and internal factors, such as our business and operational objectives and revenue forecasts. Changes in the probability assessment of achievement of the performance conditions are accounted for in the period of change by recording a cumulative catch-up adjustment as if the new estimate had been applied since the service inception date. If the projected achievement was revised upward or if the actual results were higher than the projected achievement, additional compensation expense would be recorded for the awards due to the cumulative catch-up adjustment, which would have an adverse impact on our results of operations. Conversely, if the projected achievement was revised downward or if the actual results were lower than the projected achievement, previously accrued compensation expense would be reversed for the awards, which would have a favorable impact on our results of operations. As a result, our stock-based compensation expense is subject to volatility and may fluctuate significantly each quarter due to changes in our probability assessment of achievement of the performance conditions or actual results being different from projections made by management.
Recent Accounting Pronouncements
See Note 1 of the Notes to Consolidated Financial Statements regarding a recently adopted accounting pronouncement and recent accounting pronouncements not yet adopted as of December 31, 2023.
Results of Operations
The following table summarizes our results of operations:
Year Ended December 31,
2023
2022
2021
(in thousands, except percentages)
Revenue
$
1,821,072
100.0
%
$
1,794,148
100.0
%
$
1,207,798
100.0
%
Cost of revenue
799,953
43.9
745,596
41.6
522,339
43.2
Gross profit
1,021,119
56.1
1,048,552
58.4
685,459
56.8
Operating expenses:
Research and development
263,643
14.5
240,171
13.4
190,627
15.8
Selling, general and administrative
275,740
15.1
281,596
15.6
232,415
19.3
Total operating expenses
539,383
29.6
521,767
29.0
423,042
35.1
Operating income
481,736
26.5
526,785
29.4
262,417
21.7
Other income (expense), net
24,105
1.3
(1,848
)
(0.1
)
9,802
0.8
Income before income taxes
505,841
27.8
524,937
29.3
272,219
22.5
Income tax expense
78,467
4.3
87,265
4.9
30,196
2.5
Net income
$
427,374
23.5
%
$
437,672
24.4
%
$
242,023
20.0
%
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Revenue
The following table summarizes our revenue by end market:
Year Ended December 31,
End Market
2023
% of Revenue
2022
% of Revenue
2021
% of Revenue
(in thousands, except percentages)
Storage and Computing
$
491,139
27.0
%
$
452,594
25.3
%
$
255,933
21.2
%
Enterprise Data
322,980
17.7
251,415
14.0
116,345
9.6
Automotive
394,665
21.7
300,016
16.7
204,335
16.9
Industrial
172,717
9.4
219,179
12.2
184,784
15.3
Communications
204,911
11.3
251,452
14.0
164,091
13.6
Consumer
234,660
12.9
319,492
17.8
282,310
23.4
Total
$
1,821,072
100.0
%
$
1,794,148
100.0
%
$
1,207,798
100.0
%
Revenue for the year ended December 31, 2023 was $1,821.1 million, an increase of $27.0 million, or 1.5%, from $1,794.1 million for the year ended December 31, 2022. The increase in revenue was primarily due to increases in the average selling prices resulting primarily from product mix, partially offset by lower shipment volume.
For the year ended December 31, 2023, revenue from the storage and computing market increased $38.5 million, or 8.5%, from the same period in 2022. This increase was primarily driven by increased sales of products for notebooks. Revenue from the enterprise data market increased $71.6 million, or 28.5%, from the same period in 2022. This increase was primarily due to higher sales of our power management solutions for AI applications. Revenue from the automotive market increased $94.6 million, or 31.5%, from the same period in 2022. This increase was primarily driven by increased sales of our highly integrated applications supporting advanced driver assistance systems, body electronics and the digital cockpit. Revenue from the industrial market decreased $46.5 million, or 21.2%, from the same period in 2022. This decrease primarily reflected lower sales in applications for industrial automation, security and power sources. Revenue from the communications market decreased $46.5 million, or 18.5%, from the same period in 2022. The decrease was a result of lower 4G and 5G infrastructure sales. Revenue from the consumer market decreased $84.8 million, or 26.6%, from the same period in 2022. This decrease was a result of broad market weakness across all segments.
Cost of Revenue and Gross Margin
Cost of revenue primarily consists of costs incurred to manufacture, assemble and test our products, as well as warranty costs, inventory-related and other overhead costs, and stock-based compensation expenses.
Year Ended December 31,
2023
2022
2021
(in thousands, except percentages)
Cost of revenue
$
799,953
$
745,596
$
522,339
As a percentage of revenue
43.9
%
41.6
%
43.2
%
Gross profit
$
1,021,119
$
1,048,552
$
685,459
Gross margin
56.1
%
58.4
%
56.8
%
Cost of revenue was $800.0 million, or 43.9% of revenue, for the year ended December 31, 2023, and $745.6 million, or 41.6% of revenue, for the year ended December 31, 2022. The $54.4 million increase in cost of revenue was primarily driven by product mix, partially offset by lower inventory write-downs and warranty expenses.
Gross margin was 56.1% for the year ended December 31, 2023, compared with 58.4% for the year ended December 31, 2022. The decrease in gross margin was mainly driven by product mix, partially offset by lower inventory write-downs and warranty expenses as a percentage of revenue.
Research and Development ( “ R&D ” )
R&D expenses primarily consist of cash compensation and benefits, stock-based compensation and deferred compensation for design and product engineers, expenses related to new product development and supplies, and facility costs.
Year Ended December 31,
2023
2022
2021
(in thousands, except percentages)
R&D expenses
$
263,643
$
240,171
$
190,627
As a percentage of revenue
14.5
%
13.4
%
15.8
%
R&D expenses were $263.6 million, or 14.5% of revenue, for the year ended December 31, 2023, and $240.2 million, or 13.4% of revenue, for the year ended December 31, 2022. The $23.5 million increase in R&D expenses was primarily due to a $20.9 million increase in new product development expenses, a $5.6 million increase in expenses related to changes in the value of deferred compensation plan liabilities and a $1.8 million increase in depreciation. This increase was partially offset by an $8.1 million decrease in cash compensation expenses, which was driven by decreased bonuses.
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Selling, General and Administrative ( “ SG&A ” )
SG&A expenses primarily include cash compensation and benefits, stock-based compensation and deferred compensation for sales, marketing and administrative personnel, sales commissions, travel expenses, facilities costs, third party service fees and litigation expenses.
Year Ended December 31,
2023
2022
2021
(in thousands, except percentages)
SG&A expenses
$
275,740
$
281,596
$
232,415
As a percentage of revenue
15.1
%
15.6
%
19.3
%
SG&A expenses were $275.7 million, or 15.1% of revenue, for the year ended December 31, 2023, and $281.6 million, or 15.6% of revenue, for the year ended December 31, 2022. The $5.9 million decrease in SG&A expenses was driven by a $12.4 million decrease in stock-based compensation expenses, an $8.8 million decrease in cash compensation expenses driven by decreased bonuses, and a $3.1 million decrease in litigation expenses. This decrease was partially offset by a $10.1 million increase in expenses related to changes in the value of the deferred compensation plan liabilities, and an $8.2 million increase consisting mostly of travel related expenses, third party service expenses and software licensing fees.
Other Income (Expense), Net
Other income, net, was $24.1 million for the year ended December 31, 2023, compared with other expense, net, of $1.8 million for the year ended December 31, 2022. The increase in other income was primarily due to an increase of $18.6 million in net interest income as a result of higher interest rates, and an increase of $15.1 million in income related to changes in the value of deferred compensation plan investments, partially offset by an increase of $9.0 million in charitable contributions.
Income Tax Expense
The income tax expense for the year ended December 31, 2023 was $78.5 million, or 15.5% of pre-tax income. The effective tax rate was lower than the federal statutory rate of 21% primarily due to foreign income from our subsidiaries in Bermuda and China being taxed at lower statutory tax rates and a return to provision true-up adjustment which primarily resulted from a calculation refinement of our capitalization of research and experimental expenditures under Section 174 of the Internal Revenue Code (the “IRC”). The decrease in the effective tax rate relative to the federal statutory rate was partially offset by the inclusion of the global intangible low-taxed income (“GILTI”) tax, the addition of a valuation allowance against China deferred tax assets arising from the indefinite extension of the R&D super deduction policy in China, and excess tax benefits from stock-based compensation.
The income tax expense for the year ended December 31, 2022 was $87.3 million, or 16.6% of pre-tax income. The effective tax rate was lower than the federal statutory rate of 21% primarily due to foreign income from our subsidiaries in Bermuda and China being taxed at lower statutory tax rates, and excess tax benefits from stock-based compensation. The decrease in the effective tax rate relative to the federal statutory rate was partially offset by the inclusion of the GILTI tax.
In December 2023, the Bermuda Corporate Income Tax Act of 2023 (the “Bermuda CIT Act”) was enacted and signed into law. The Bermuda CIT Act includes a 15% corporate income tax (“CIT”) applicable to Bermuda businesses that are multinational enterprise (“MNE”) groups with annual revenue of €750M or more beginning in 2025. The Bermuda CIT Act also includes an Economic Transition Adjustment (“ETA”) that requires MNE’s to revalue their assets and liabilities, excluding goodwill, at their fair value as of September 30, 2023. There is an election to opt out of the ETA. As the Bermuda CIT Act is not effective until January 1, 2025, we are evaluating whether or not to adopt this ETA. Based on information available, we have not recorded any changes to income tax expense related to the Bermuda CIT Act as of December 31, 2023.
In August 2022, the CHIPS Act and the Inflation Reduction Act of 2022 (the “IRA”) were enacted and signed into law, which did not have a material impact on our income tax provisions, results of operations or financial condition for the years ended December 31, 2023 or 2022. We will continue to monitor any new developments related to the CHIPS Act and the IRA and evaluate their impact on our financial statements.
See Note 11 of the Notes to Consolidated Financial Statements for further discussion.
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Liquidity and Capital Resources
December 31,
2023
2022
(in thousands, except percentages)
Cash and cash equivalents
$
527,843
$
288,607
Short-term investments
580,633
449,266
Total cash, cash equivalents and short-term investments
$
1,108,476
$
737,873
Percentage of total assets
45.5
%
35.8
%
Total current assets
$
1,819,499
$
1,410,619
Total current liabilities
(235,035
)
(263,400
)
Working capital
$
1,584,464
$
1,147,219
As of December 31, 2023, we had cash and cash equivalents of $527.8 million and short-term investments of $580.6 million, compared with cash and cash equivalents of $288.6 million and short-term investments of $449.3 million as of December 31, 2022. As of December 31, 2023, $369.9 million of cash and cash equivalents and $528.0 million of short-term investments were held by our international subsidiaries. For the year ended December 31, 2023, we repatriated $140 million of cash from our Bermuda subsidiary to the U.S. with minimal tax impact. The proceeds are primarily used to fund our ongoing business operations. We may repatriate additional cash from our Bermuda subsidiary to fund our expenditures in future periods. We anticipate that earnings from other foreign subsidiaries will continue to be indefinitely reinvested.
Summary of Cash Flows
The following table summarizes our cash flow activities:
Year Ended December 31,
2023
2022
2021
(in thousands)
Net cash provided by operating activities
$
638,213
$
246,674
$
320,010
Net cash used in investing activities
(178,726
)
(12,510
)
(378,886
)
Net cash used in financing activities
(183,725
)
(128,785
)
(90,206
)
Effect of change in exchange rates
(3,310
)
(6,039
)
3,400
Net increase (decrease) in cash, cash equivalents and restricted cash
$
272,452
$
99,340
$
(145,682
)
For the year ended December 31, 2023, the $391.5 million increase in cash provided by operating activities compared to the prior period was primarily due to decreased inventory purchases, decreased prepaid wafer expenses, increased accounts receivable collections and other changes in working capital.
For the year ended December 31, 2023, the $166.2 million increase in cash used in investing activities compared to the prior period was primarily due to an increase of $518.9 million in purchases of investments, partially offset by an increase of $340.4 million in sales of investments.
For the year ended December 31, 2023, the $54.9 million increase in cash used in financing activities compared to the prior period was primarily due to a $47.9 million increase in dividend and dividend equivalent payments.
Cash Requirements
Although consequences of economic uncertainty and macroeconomic conditions and other factors could adversely affect our liquidity and capital resources in the future, and cash requirements may fluctuate based on the timing and extent of many factors such as those discussed above, we believe that our balances of cash, cash equivalents and short-term investments of $1,108.5 million as of December 31, 2023, along with cash generated by ongoing operations, will be sufficient to satisfy our liquidity requirements for the next 12 months and beyond.
Our material cash requirements include the following contractual and other obligations:
Purchase Obligations
Purchase obligations represent commitments to our suppliers and other parties requiring the purchases of goods or services. Our purchase obligations primarily consist of wafer and other inventory purchases, assembly and other manufacturing services, construction of manufacturing and R&D facilities, purchases of production and other equipment, and license arrangements.
In May 2022, we entered into a long-term supply agreement in order to secure manufacturing production capacity for silicon wafers over a four-year period. As of December 31, 2023, we had remaining prepayments under this agreement of $120.0 million reported in other long-term assets on the Consolidated Balance Sheet.
As of December 31, 2023, total estimated future unconditional purchase commitments to all suppliers and other parties, net of the $120.0 million prepayment, were $699.7 million, of which $367.8 million was classified as short-term.
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Transition Tax Liability
The transition tax liability represents the one-time, mandatory deemed repatriation tax imposed on previously deferred foreign earnings under the U.S. Tax Cuts and Jobs Act enacted in December 2017 (the “2017 Tax Act”) . As permitted by the 2017 Tax Act, we have elected to pay the tax liability in installments on an interest-free basis through 2025. As of December 31, 2023, the remaining liability totaled $11.1 million, of which $4.9 million was short-term.
Operating Leases
Operating lease obligations represent the undiscounted remaining lease payments primarily for our leased facilities and equipment. As of December 31, 2023, these obligations totaled $7.9 million, of which $2.3 million was short-term.
Capital Return to Stockholders
In October 2023, our Board of Directors approved a new stock repurchase program authorizing us to repurchase up to $640.0 million in the aggregate of our common stock through October 29, 2026. Shares are retired upon repurchase. We repurchased approximately 7,000 shares of our common stock for an aggregate purchase price of $3.7 million during the year ended December 31, 2023. As of December 31, 2023, $636.3 million remained available for future repurchases under the program.
We currently have a dividend program approved by our Board of Directors, pursuant to which we intend to pay quarterly cash dividends on our common stock. Based on our historical practice, stockholders of record as of the last business day of the quarter are entitled to receive the quarterly cash dividends when and if declared by the Board of Directors, which are payable to the stockholders in the following month. As of December 31, 2023, accrued dividends totaled $47.9 million. The declaration of any future cash dividends is at the discretion of our Board of Directors and will depend on, among other things, our financial condition, results of operations, capital requirements, business conditions and other factors that our Board of Directors may deem relevant, as well as a determination that cash dividends are in the best interests of our stockholders.
In February 2024, our Board of Directors approved an increase in the quarterly cash dividend from $1.00 per share to $1.25 per share, which amount will be paid on April 15, 2024 to all stockholders of record as of the close of business on March 29, 2024.
Other Long-Term Obligations
Other long-term obligations primarily include payments for deferred compensation plan liabilities and accrued dividend equivalents. As of December 31, 2023, these obligations totaled $83.1 million.
Acquisition
On January 3, 2024, we acquired Axign, a Dutch company for $33.8 million in cash. See Note 17 of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K for additional information.