Silicon Motion Announces Preliminary 1Q 2010 Revenue
April 15 2010 - 4:30PM
Silicon Motion Technology Corporation (Nasdaq:SIMO) (the
"Company"), a leading fabless semiconductor company that designs,
develops and markets semiconductor solutions for multimedia
consumer electronics, today announced that expected revenue in the
first quarter of 2010 will be stronger than the Company's previous
outlook. In addition, the Company has revised upwards fourth
quarter 2009 obsolete inventory reserves and consequently revised
downwards its fourth quarter 2009 gross margin.
The Company expects revenue in the first quarter of 2010 to
increase sequentially 15% to 16%. This is a positive increase
over the guidance provided by the Company in early February 2010
that revenue would be down 5% to up 5% sequentially.
Following the announcement of the Company's unaudited fourth
quarter 2009 results and following recent evaluation by the Company
of the salability of parts in inventory, the Company now believes
that because of rapidly changing market conditions and customer
requirements, certain additional elements of its inventory are now
obsolete. The reserves for obsolete inventory are considered
subsequent events and therefore have been included within the
Company's fourth quarter 2009 results. Gross margin excluding
stock-based compensation will decrease to approximately 27% to 28%
from 42.2%, which was previously disclosed. Fourth quarter 2009
gross margin excluding stock-based compensation and reserves for
obsolete and end-of-life products will decrease from 52.1% to
51.5%.
The Company expects first quarter 2010 gross margin excluding
stock-based compensation to be in line with its previously
communicated guidance of 46% to 48%.
Separately, as previously reported, the Company continues to
assess impairment of goodwill and acquisition related intangible
assets relating to its 2007 FCI acquisition. The Company
anticipates announcing impairment charges in its upcoming earnings
release, as well as in its 2009 Annual Report on Form 20-F.
"We are working to put the difficulties caused by the global
economic recession behind us and get back to growing our
business. We are delighted with the better than expected
availability of NAND flash components, principally 3 bits per cell
MLC, available to module makers and the increased procurement by
our customers of our best-in-class 3 bits per cell MLC
controllers. Our leading market share in 3 bits per cell MLC
controllers is validation that our R&D investment in new
technologies is paying off," said Wallace Kou, President and CEO of
Silicon Motion.
Silicon Motion is planning on releasing its first quarter 2010
results in either the last week of April or the first week of May
2010. Details on this as well as our earnings call will be
provided in a separate announcement.
About Silicon Motion:
We are a fabless semiconductor company that designs, develops
and markets high performance, low-power semiconductor solutions for
the multimedia consumer electronics market. We have three major
product lines: mobile storage, mobile communications, and
multimedia SoCs. Our mobile storage business is composed of
microcontrollers used in NAND flash memory storage products such as
flash memory cards, USB flash drives, SSDs, and embedded flash
applications. Our mobile communications business is composed of
mobile TV IC solutions, CDMA RF ICs, and electronic toll collection
RF ICs. Our multimedia SoCs business is composed of products that
support notebook PC webcams and embedded graphics applications.
Forward-Looking Statements:
This press release contains "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, including without limitation, statements about Silicon
Motion's updated expected first quarter 2010 guidance, revenue and
gross margin, all of which reflect management's estimates based on
information available at this time of this press
release. While Silicon Motion believes these estimates to be
meaningful, these amounts could differ materially from actual
reported amounts for the first quarter. Forward-looking statements
also include, without limitation, statements regarding trends in
the multimedia consumer electronics market and our future results
of operations, financial condition and business prospects. In
some cases, you can identify forward-looking statements by
terminology such as "may," "will," "should," "expect," "intend,"
"plan," "anticipate," "believe," "estimate," "predict,"
"potential," "continue," or the negative of these terms or other
comparable terminology. Although such statements are based on
our own information and information from other sources we believe
to be reliable, you should not place undue reliance on
them. These statements involve risks and uncertainties, and
actual market trends or our actual results of operations, financial
condition or business prospects may differ materially from those
expressed or implied in these forward looking statements for a
variety of reasons. Potential risks and uncertainties include,
but are not limited to, our belief in the outcome of any claim or
lawsuit; the determination of the Company of the need to record a
charge to earnings relating to certain impairments of assets in
2009, and the amounts of such impairments; unpredictable volume and
timing of customer orders, which are not fixed by contract but vary
on a purchase order basis; the loss of one or more key customers or
the significant reduction, postponement, rescheduling or
cancellation of orders from these customers; integration of our
recently announced acquisitions; general economic conditions or
conditions in the semiconductor or consumer electronics markets;
decreases in the overall average selling prices of our products;
changes in the relative sales mix of our products; changes in our
cost of finished goods; the availability, pricing, and timeliness
of delivery of other components and raw materials used in our
customers' products; our customers' sales outlook, purchasing
patterns, and inventory adjustments based on consumer demands and
general economic conditions, including the general global economic
slowdown as it effects us, our customers and consumers; our ability
to successfully develop, introduce, and sell new or enhanced
products in a timely manner; and the timing of new product
announcements or introductions by us or by our competitors. For
additional discussion of these risks and uncertainties and other
factors, please see the documents we file from time to time with
the Securities and Exchange Commission, including our Annual Report
on Form 20-F filed on July 14, 2009. We assume no obligation
to update any forward-looking statements, which apply only as of
the date of this press release.
CONTACT: Silicon Motion Technology Corporation
Investor Contact:
Jason Tsai, Director of IR and Strategy
+1 408 519 7259
Fax: +1 408 519 7101
jtsai@siliconmotion.com
Investor Relations
Selina Hsieh
+886 3 552 6888 x2311
Fax: +886 3 560 0336
ir@siliconmotion.com
Media Contact:
Sara Hsu, Project Manager
+886 2 2219 6688 x3509
Fax: +886 2 2219 6868
sara.hsu@siliconmotion.com
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