GSI Technology, Inc. (NASDAQ:GSIT) today reported
financial results for its first fiscal quarter ended June 30, 2018.
The Company reported a net loss of $(1.6 million), or $(0.08)
per diluted share, on net revenues of $11.3 million for the
first quarter of fiscal 2019, compared to net loss of $(1.5
million), or $(0.07) per diluted share, on net revenues of $10.7
million in the first quarter of fiscal 2018 and net income of
$265,000, or $0.01 per diluted share, on net revenues of
$11.2 million in the fourth quarter of fiscal 2018. Gross
margin was 51.4% compared to 52.4% in the prior year period and
56.2% in the preceding fourth quarter.
Total operating expenses in the first quarter of fiscal 2019
were $7.4 million, compared to $7.1 million in the first quarter of
fiscal 2018 and $6.4 million in the preceding fourth quarter.
Research and development expenses were $4.9 million, compared to
$4.3 million in the prior year period and $4.3 million in the
preceding fourth quarter. Selling, general and administrative
expenses were $2.6 million in the quarter ended June 30, 2018
compared to $2.8 million in the prior year quarter ended June 30,
2017, and up sequentially from $2.1 million in the preceding fourth
quarter.
Lee-Lean Shu, Chairman and Chief Executive Officer, noted, “Our
core business continues to perform in line with our expectations.
Net revenues for the first quarter came in above the range of
guidance that we provided on our last earnings call. We remain on
track with product development and marketing efforts for our newest
market segments. In fiscal 2019 we anticipate revenue contribution
from our high performance SigmaQuad radiation-hardened products,
which will begin shipping in the fourth quarter of calendar year
2018. Also, we are pleased to announce delivery of the initial
design of our patented in-place associative computing technology,
or ‘APU’, to our foundry partner in Taiwan. We expect to have
silicon samples of the APU chip later in calendar 2018, and
anticipate commercializing our initial AI product in calendar 2019.
The delivery caps three years of investment and dedicated effort
from our Sunnyvale and Israeli teams. Our APU’s unique
massive parallel data processing capability improves computation,
search and response time in critical 'big data' applications,
including machine learning and deep convolutional neural networks,
computer vision and cyber security.”
In the first quarter of fiscal 2019, sales to Nokia were $5.2
million, or 46.5% of net revenues compared to $4.1 million, or
36.7% of net revenues, in the prior quarter and $4.5 million, or
42.3% of net revenues, in the same period a year ago.
Military/defense sales were 19.7% of shipments compared to 29.5% of
shipments in the prior quarter and 24.5% of shipments in the
comparable period a year ago. SigmaQuad sales were 59.7% of
shipments compared to 45.0% in the prior quarter and 51.1% in the
first quarter of fiscal 2018.
Our first-quarter fiscal 2019 operating loss was $(1.7 million),
compared to an operating loss of $(111,000) in the prior quarter
and an operating loss of $(1.5 million) a year ago. The
first-quarter fiscal 2019 net loss included interest and other
income of $23,000 and a tax provision of $10,000, compared to
$98,000 in interest and other income and a tax provision of $81,000
for the same period a year ago. In the preceding fourth quarter,
net loss included interest and other income of $109,000 and a tax
benefit of $267,000.
Total first-quarter pre-tax stock-based compensation expense was
$542,000 compared to $549,000 in the prior quarter and $478,000 in
the comparable quarter a year ago.
At June 30, 2018, the Company had $52.6 million in cash, cash
equivalents and short-term investments, $11.9 million in long-term
investments, $59.6 million in working capital, no debt, and
stockholders’ equity of $87.6 million.
Outlook for Second Quarter of Fiscal 2019
Looking forward to the second quarter of fiscal 2019, we
currently expect net revenues to be in the range of $11.5 million
to $12.3 million. We expect gross margin of approximately 57% to
59% in the second quarter.
Conference Call
GSI Technology will review its financial results for the quarter
ended June 30, 2018 and discuss its current business outlook during
a conference call at 1:30 p.m. Pacific (4:30 p.m. Eastern) today,
July 26, 2018. To listen to the teleconference, please call
toll-free 888-254-3590 approximately 10 minutes prior to the above
start time and provide Conference ID 9185760. You may also listen
to the teleconference live via the Internet at
www.gsitechnology.com, where it will be archived.
About GSI Technology
Founded in 1995, GSI Technology, Inc. is a leading provider of
semiconductor memory solutions with the largest portfolio of high
performance memory products and core competencies in Very Fast SRAM
and LLDRAM. Today the Company’s resources are focused on bringing
new products to market that leverage existing core strengths and
expand market opportunities.
The company is headquartered in Sunnyvale, California and has
sales offices in the Americas, Europe and Asia. For more
information, please visit www.gsitechnology.com.
Forward-Looking Statements
The statements contained in this press release that are not
purely historical are forward-looking statements within the meaning
of Section 21E of the Securities Exchange Act of 1934, as amended,
including statements regarding GSI Technology’s expectations,
beliefs, intentions, or strategies regarding the future. All
forward-looking statements included in this press release are based
upon information available to GSI Technology as of the date hereof,
and GSI Technology assumes no obligation to update any such
forward-looking statements. Forward-looking statements involve a
variety of risks and uncertainties, which could cause actual
results to differ materially from those projected. These
risks include those associated with the normal quarterly closing
process. Examples of risks that could affect our current
expectations regarding second quarter revenues and gross margins
include those associated with fluctuations in GSI Technology’s
operating results; GSI Technology’s historical dependence on sales
to a limited number of customers and fluctuations in the mix of
customers and products in any period; the rapidly evolving markets
for GSI Technology’s products and uncertainty regarding the
development of these markets; the need to develop and introduce new
products to offset the historical decline in the average unit
selling price of GSI Technology’s products; the challenges of rapid
growth followed by periods of contraction; and intensive
competition; and delays or unanticipated costs that may be
encountered in the development of new products based on our
in-place associative computing technology and the establishment of
new markets and customer relationships for the sale of such
products. Further information regarding these and other risks
relating to GSI Technology’s business is contained in the Company’s
filings with the Securities and Exchange Commission, including
those factors discussed under the caption “Risk Factors” in such
filings.
Source: GSI Technology, Inc.
GSI Technology, Inc. Douglas M. Schirle Chief Financial Officer
408-331-9802
Hayden IR Kimberly Rogers/David Fore385-831-7337
|
GSI TECHNOLOGY, INC. |
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
(in thousands, except per share
data) |
(Unaudited) |
|
|
|
|
|
|
Three Months Ended |
|
June 30, |
Mar. 31, |
June 30, |
|
2018 |
2018 |
2017 |
|
|
|
|
Net
revenues |
$11,266 |
|
$11,191 |
|
$10,687 |
|
Cost of
goods sold |
5,478 |
|
4,902 |
|
5,083 |
|
|
|
|
|
|
|
Gross
profit |
5,788 |
|
6,289 |
|
5,604 |
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
Research
& development |
4,850 |
|
4,272 |
|
4,335 |
|
|
Selling,
general and administrative |
2,597 |
|
2,128 |
|
2,798 |
|
|
|
Total operating
expenses |
7,447 |
|
6,400 |
|
7,133 |
|
|
|
|
|
|
|
Operating
income (loss) |
(1,659 |
) |
(111 |
) |
(1,529 |
) |
|
|
|
|
|
|
Interest
and other income, net |
23 |
|
109 |
|
98 |
|
|
|
|
|
|
|
Income
(loss) before income taxes |
(1,636 |
) |
(2 |
) |
(1,431 |
) |
Provision
(benefit) for income taxes |
10 |
|
(267 |
) |
81 |
|
Net income
(loss) |
($1,646 |
) |
$265 |
|
($1,512 |
) |
|
|
|
|
|
|
|
|
|
|
Net income
(loss) per share, basic |
($0.08 |
) |
$0.01 |
|
($0.07 |
) |
Net income
(loss) per share, diluted |
($0.08 |
) |
$0.01 |
|
($0.07 |
) |
|
|
|
|
|
Weighted-average shares used in |
|
|
|
computing per share amounts: |
|
|
|
|
|
|
|
Basic |
21,567 |
|
21,334 |
|
20,805 |
|
Diluted |
21,567 |
|
23,476 |
|
20,805 |
|
|
|
|
|
|
|
|
|
Stock-based
compensation included in the Condensed Consolidated Statements of
Operations: |
|
|
|
|
|
Three Months Ended |
|
June 30, |
Mar. 31, |
June 30, |
|
2018 |
2018 |
2017 |
|
|
|
|
Cost of
goods sold |
$53 |
|
$73 |
|
$47 |
|
Research
& development |
323 |
|
298 |
|
267 |
|
Selling,
general and administrative |
166 |
|
178 |
|
164 |
|
|
$542 |
|
$549 |
|
$478 |
|
|
|
|
|
|
GSI TECHNOLOGY, INC. |
CONDENSED CONSOLIDATED BALANCE
SHEETS |
(in thousands) |
(Unaudited) |
|
|
|
|
|
June
30, 2018 |
|
March
31, 2018 |
Cash and cash
equivalents |
$36,426 |
|
$40,241 |
Short-term
investments |
16,166 |
|
18,124 |
Accounts
receivable |
6,847 |
|
5,279 |
Inventory |
5,141 |
|
5,547 |
Other current
assets |
2,114 |
|
2,080 |
Net property and
equipment |
9,332 |
|
8,172 |
Long-term
investments |
11,921 |
|
7,923 |
Other assets |
12,090 |
|
12,174 |
Total assets |
$100,037 |
|
$99,540 |
|
|
|
|
Current
liabilities |
$7,454 |
|
$7,404 |
Long-term
liabilities |
5,379 |
|
5,321 |
Stockholders'
equity |
87,204 |
|
86,815 |
Total liabilities and
stockholders' equity |
$100,037 |
|
$99,540 |
|
|
|
|
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