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Silicon Motion's Q3 Earnings Beat Estimates on Solid Revenue Growth
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Silicon Motion Technology Corporation (SIMO - Free Report) reported solid third-quarter 2024 results, with both adjusted earnings and revenues surpassing the Zacks Consensus Estimate.
Stay up-to-date with all quarterly releases: See ZacksEarnings Calendar.
The leading merchant supplier of client SSD (Solid State Drive) controllers witnessed top-line growth driven by healthy demand trends.
SIMO’s Net Income
On a GAAP basis, net income was $20.8 million or 62 cents per American depositary share (ADS) compared with $10.6 million or 32 cents per ADS in the prior-year quarter. Higher net sales across various end markets contributed to the year-over-year improvement in GAAP earnings.
Non-GAAP net income was $31 million or 92 cents per ADS, up from $21.1 million or 63 cents per ADS in the year-ago quarter. The bottom line beat the Zacks Consensus Estimate by 7 cents.
Silicon Motion Technology Corporation Price, Consensus and EPS Surprise
Quarterly revenues increased to $212.4 million from the year-ago quarter’s tally of $172.3 million. The top line beat the Zacks Consensus Estimate of $210 million. Increased sales of SSD controllers, as well as eMMC and UFS controllers, on a year-over-year basis, contributed to the top-line growth.
Management noted that sales of SSD controllers were flat sequentially and up 20 -25% on a year-over-year basis.
eMMC+UFS (Embedded Multi-Media Card + Universal Flash Storage) sales recorded solid sequential improvement between 0% and 5% and increased 40-45% year over year.
Revenues in SSD solutions increased 5-10% sequentially and year over year.
SIMO’s Other Details
Non-GAAP gross profit aggregated $99.3 million compared with $73.3 million in the year-ago quarter, with respective margins of 46.8% and 42.5%. The rise was primarily driven by higher revenues year over year. Non-GAAP operating expenses increased to $65.1 million from $49.5 million. Non-GAAP operating income increased from $23.8 million to $34.2 million year-over-year, with margins of 13.8% and 16.1%, respectively.
SIMO’s Cash Flow & Liquidity
During the September quarter, Silicon Motion generated $54.05 million of cash from operating activities compared with $64.9 million in the year-ago period. As of Sept. 30, 2024, the company had $313.9 million in cash and cash equivalents with $62.7 million of other liabilities.
The company’s capital expenditure totaled $12.4 million. This includes $7.4 million for the routine procurement of testing equipment, software, design tools and other goods and another $5 million for building construction in Hsinchu.
SIMO’s Outlook
For fourth-quarter 2024, management estimates non-GAAP revenues to be in the range of $191-$202 million. Non-GAAP gross margin is expected to be around 46.5-47.5%. Operating margin is anticipated to be in the band of 15.6-16.6%. The company expects that the introduction of two key new controllers, including the AI/enterprise server MonTitan controller and PCIe Gen 5.0 client SSD controller solutions, to scale further in the fourth quarter with improvement in demand.
Motorola Solutions, Inc. (MSI - Free Report) is scheduled to release third-quarter earnings on Nov. 7. The Zacks Consensus Estimate for earnings is pegged at $3.36 per share, indicating growth of 5.33% from the year-ago figure.
Pinterest, Inc. (PINS - Free Report) is scheduled to release third-quarter 2024 earnings on Nov. 7. The Zacks Consensus Estimate for earnings is pegged at 34 cents per share, indicating growth of 21.4% from the year-ago figure.
Light and Wonder (LNW - Free Report) is scheduled to release third-quarter earnings on Nov. 12. The Zacks Consensus Estimate for earnings is pegged at $1.11 per share, indicating growth of 37% from the year-ago figure.
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Silicon Motion's Q3 Earnings Beat Estimates on Solid Revenue Growth
Silicon Motion Technology Corporation (SIMO - Free Report) reported solid third-quarter 2024 results, with both adjusted earnings and revenues surpassing the Zacks Consensus Estimate.
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
The leading merchant supplier of client SSD (Solid State Drive) controllers witnessed top-line growth driven by healthy demand trends.
SIMO’s Net Income
On a GAAP basis, net income was $20.8 million or 62 cents per American depositary share (ADS) compared with $10.6 million or 32 cents per ADS in the prior-year quarter. Higher net sales across various end markets contributed to the year-over-year improvement in GAAP earnings.
Non-GAAP net income was $31 million or 92 cents per ADS, up from $21.1 million or 63 cents per ADS in the year-ago quarter. The bottom line beat the Zacks Consensus Estimate by 7 cents.
Silicon Motion Technology Corporation Price, Consensus and EPS Surprise
Silicon Motion Technology Corporation price-consensus-eps-surprise-chart | Silicon Motion Technology Corporation Quote
Silicon Motion’s Revenues
Quarterly revenues increased to $212.4 million from the year-ago quarter’s tally of $172.3 million. The top line beat the Zacks Consensus Estimate of $210 million. Increased sales of SSD controllers, as well as eMMC and UFS controllers, on a year-over-year basis, contributed to the top-line growth.
Management noted that sales of SSD controllers were flat sequentially and up 20 -25% on a year-over-year basis.
eMMC+UFS (Embedded Multi-Media Card + Universal Flash Storage) sales recorded solid sequential improvement between 0% and 5% and increased 40-45% year over year.
Revenues in SSD solutions increased 5-10% sequentially and year over year.
SIMO’s Other Details
Non-GAAP gross profit aggregated $99.3 million compared with $73.3 million in the year-ago quarter, with respective margins of 46.8% and 42.5%. The rise was primarily driven by higher revenues year over year. Non-GAAP operating expenses increased to $65.1 million from $49.5 million. Non-GAAP operating income increased from $23.8 million to $34.2 million year-over-year, with margins of 13.8% and 16.1%, respectively.
SIMO’s Cash Flow & Liquidity
During the September quarter, Silicon Motion generated $54.05 million of cash from operating activities compared with $64.9 million in the year-ago period. As of Sept. 30, 2024, the company had $313.9 million in cash and cash equivalents with $62.7 million of other liabilities.
The company’s capital expenditure totaled $12.4 million. This includes $7.4 million for the routine procurement of testing equipment, software, design tools and other goods and another $5 million for building construction in Hsinchu.
SIMO’s Outlook
For fourth-quarter 2024, management estimates non-GAAP revenues to be in the range of $191-$202 million. Non-GAAP gross margin is expected to be around 46.5-47.5%. Operating margin is anticipated to be in the band of 15.6-16.6%. The company expects that the introduction of two key new controllers, including the AI/enterprise server MonTitan controller and PCIe Gen 5.0 client SSD controller solutions, to scale further in the fourth quarter with improvement in demand.
SIMO’s Zacks Rank
Silicon Motion currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Releases
Motorola Solutions, Inc. (MSI - Free Report) is scheduled to release third-quarter earnings on Nov. 7. The Zacks Consensus Estimate for earnings is pegged at $3.36 per share, indicating growth of 5.33% from the year-ago figure.
Pinterest, Inc. (PINS - Free Report) is scheduled to release third-quarter 2024 earnings on Nov. 7. The Zacks Consensus Estimate for earnings is pegged at 34 cents per share, indicating growth of 21.4% from the year-ago figure.
Light and Wonder (LNW - Free Report) is scheduled to release third-quarter earnings on Nov. 12. The Zacks Consensus Estimate for earnings is pegged at $1.11 per share, indicating growth of 37% from the year-ago figure.