TAINAN, Taiwan, April 07, 2025 (GLOBE NEWSWIRE) -- Himax Technologies, Inc. (NASDAQ:HIMX) ("Himax" or "Company"), a leading supplier and fabless manufacturer of display drivers and other semiconductor products, today announced that it will hold a conference call with investors and analysts on Thursday, May 8, 2025, at 8:00 a.m. US Eastern Daylight Time and 8:00 p.m. Taiwan Time to discuss the Company's first quarter 2025 financial results. HIMAX TECHNOLOGIES, INC. FIRST QUARTER 2025 EARNINGS CONFERENCE CALL ...

Revenue Sources and Customer Concentration - In 2023 and 2024, 85.1% and 82.9% of the company's revenues were derived from display drivers for TFT-LCD and OLED panels, indicating a heavy reliance on this sector[29] - Customer A and its affiliates accounted for 26.4% of the company's revenues in 2024, with the two largest customers together representing over 34% of total revenues, highlighting significant customer concentration risk[34] - In 2023, approximately 76.2% of the company's revenues were from customers headquartered in the PRC, with an expectation to continue increasing sales in the future[80] - As of December 31, 2024, Himax sold products to approximately 300 customers, with the top ten customers accounting for about 76.7%, 74.1%, and 73.6% of revenues in 2022, 2023, and 2024 respectively[198] - The two largest customers contributed 32.3%, 28.7%, and 26.4% of revenues in 2022, 2023, and 2024 respectively, indicating a significant reliance on major clients[198] Product Development and Innovation - The company is expanding its product offerings to non-driver products, which may have higher gross margins, including technologies such as Timing controller (TCON), LCoS microdisplay, and CMOS image sensors[31] - The company is focusing on developing innovative display driver solutions to maintain market share and attract new customers, as demand for display drivers may decrease due to technological advancements[40] - The company is investing in the development of non-driver products, but uncertainties exist regarding the successful commercialization and market acceptance of these products[33] - Himax's advanced OLED on-cell touch controllers achieve a touch signal-to-noise ratio of over 45 dB, enhancing reliability in challenging conditions[42] - The company has developed the WiseEye Ultralow Power AI Sensing technology, which combines an ultralow power AI processor, always-on CMOS image sensor, and CNN-based AI algorithm for consumer electronics and AIoT applications[107] Market Challenges and Risks - The average selling prices of TFT-LCD and OLED panels are expected to decline over time, which could negatively impact the company's revenues and profit margins[29] - The company faces risks from industry consolidation among suppliers, which may increase costs and reduce profit margins if price increases cannot be passed on to customers[28] - The company is exposed to risks related to public health epidemics, which could disrupt operations and negatively impact financial results[38] - The company has extended payment terms for certain customers, increasing credit risk and potentially affecting cash flow and liquidity[34] - The company does not have long-term purchase commitments from customers, leading to significant uncertainty and volatility in revenues[60] Competitive Landscape - The company operates in a highly competitive semiconductor market, facing intense competition from larger firms with greater resources[71] - The competitive landscape includes intense competition from fabless display driver companies and integrated device manufacturers, highlighting the need for differentiation in customer relations and product performance[225][226] - In the In-cell TDDI segment, the company competes with Novatek Microelectronics Corp., Synaptics Incorporated, and others[228] - For LCoS microdisplay products, competition includes OmniVision, Syndiant, and alternative technologies like DLP from Texas Instruments[228] - In the power ICs market, the company faces competition from Richtek Technology Corp. and Global Mixed-mode Technology Inc. among others[229] Supply Chain and Manufacturing - The global semiconductor market has experienced a severe foundry capacity shortage since 2020, prompting the company to enter strategic agreements with foundry partners to secure capacity[50] - The company does not have long-term agreements with foundry partners, which may lead to unfavorable pricing and contractual penalties if committed volumes are not met[50] - Access to third-party tape, assembly, and testing services is critical, and any disruptions could harm customer relationships and reduce sales[51] - The company operates primarily in a fabless model, leveraging third-party foundries for wafer fabrication and assembly, which allows for reduced capital expenditures and operational flexibility[203] - The company has made investments in internal capabilities for test program development and engineering testing since 2022, enhancing its manufacturing support[204] Financial and Operational Risks - The company has extended payment terms for certain customers, increasing credit risk and potentially affecting cash flow and liquidity[34] - The company is primarily affected by fluctuations in exchange rates between the U.S. dollar and the NT dollar, which could adversely impact operating profit[82] - The company is subject to potential adverse effects from changes in PRC laws and regulations, which could impact its customers and suppliers in China[81] - Any unfavorable changes in ROC tax laws could increase the company's effective tax rate and adversely affect operating results[83] - The company may face difficulties in protecting shareholder interests due to limited judicial precedents regarding shareholders' rights under Cayman Islands law[97] Strategic Partnerships and Acquisitions - The company has partnered with FOCI Fiber Optic Communications, Inc. to develop co-packaged optics (CPO) technology, which is expected to enhance bandwidth and reduce power consumption, with small-scale production starting in late 2024[32] - Himax completed the acquisition of Wisepal (now Himax Semiconductor, Inc.) in February 2007, enhancing its competitive position in small and medium-sized product areas[101] - Himax's acquisition of Emza Visual Sense Ltd. in June 2018 aimed to develop visual sensors with improved power consumption and form factor, although the company disposed of its shareholdings in Emza in October 2022[103] - The company has made minority investments in various companies for strategic purposes, enhancing its technology and product offerings[104] Technology and Product Features - The company has developed low power consumption drivers that meet Energy Star 8.0 and 9.0 standards[123] - The automotive OLED touch controller IC is set to enter production in Q3 2024, featuring an industry-leading touch signal-to-noise ratio of over 45 dB[128] - The Front-lit LCoS Microdisplay achieves a brightness of 400,000 nits while consuming only 300 mW of power, setting a new benchmark in the industry[148] - The WiseEye AI total solution supports various CMOS image sensors and operates with power consumption as low as 100uW, targeting always-on applications[187] - Himax Display's LCoS microdisplay technology offers higher brightness and lower power consumption compared to other microdisplay technologies, positioning the company at the forefront of AR glasses and AR-HUD markets[195]

Company Overview - Himax Technologies (NASDAQ: HIMX) is a semi-fabless semiconductor design and manufacturing firm specializing in optical and driver components for displays and sensors [1] - The company ranks in the top-5 in market share within the display technology sector, holding a significant 50% share in the automotive display market [1] Leadership and Background - The founder of Building Benjamins, Benjamin Halliburton, has a long history in investment management, having started his career at Merrill Lynch in 1986 and later founding Tradition Capital Management in 2000 [1] - Halliburton has received accolades such as "PSN Manager of the Decade" for All-Cap in the 2000s and for Dividend Value in the 2010s, showcasing his successful investment strategies [1] - He was recognized as the top-performing portfolio manager at Brundage, Story and Rose, where his "Disciplined Growth Strategy" outperformed the S&P 500 during the 1990s bull market [1]

Core Viewpoint - Himax Technologies, Tata Electronics, and Powerchip Semiconductor Manufacturing Corporation (PSMC) have signed a Memorandum of Understanding (MoU) to enhance India's display semiconductor and ultralow power AI sensing technology ecosystem, aiming for both domestic and global market expansion [1][2]. Group 1: Partnership Objectives - The collaboration aims to deliver comprehensive, end-to-end display semiconductor solutions, including chip design, manufacturing, packaging, and electronics manufacturing services (EMS) [2]. - The partnership will focus on developing solutions that meet "Made in India" requirements while enhancing supply chain resilience [2][4]. Group 2: Strategic Importance - This MoU builds on a previous agreement between Tata Electronics and PSMC to establish advanced semiconductor manufacturing capabilities in India, paving the way for innovative display solutions tailored to the domestic market [3]. - The partnership is expected to drive innovation and develop next-generation technologies to meet the growing demands in key industries for display and ultralow power AI sensing technologies [4]. Group 3: Company Profiles - Tata Electronics is a prominent player in the electronics manufacturing industry, established in 2020, with over 65,000 employees and operations across multiple Indian states [5]. - PSMC is the world's seventh-largest pure-play foundry, capable of producing over 2.1 million 12-inch equivalent wafers annually, with a strong commitment to environmental governance [6][7]. - Himax Technologies specializes in display imaging processing technologies and is a leader in automotive display technology, with a significant number of patents granted and pending [8].

Core Viewpoint - Himax Technologies, Tata Electronics, and Powerchip Semiconductor Manufacturing Corporation (PSMC) have signed a Memorandum of Understanding (MoU) to enhance India's display semiconductor and ultralow power AI sensing technology ecosystem, aiming to expand their market outreach both domestically and globally [1][2]. Group 1: Partnership Objectives - The collaboration aims to deliver comprehensive, end-to-end display semiconductor solutions, including chip design, manufacturing, packaging, and electronics manufacturing services (EMS) [2]. - The partnership will focus on "Made in India" requirements and the development of next-generation solutions to meet global demand while enhancing supply chain resilience [2][4]. Group 2: Strategic Importance - This MoU builds on a previous agreement between Tata Electronics and PSMC to establish advanced semiconductor manufacturing capabilities in India, paving the way for innovative display solutions tailored to the domestic market [3]. - The partnership is expected to create a powerful ecosystem that addresses both domestic and global needs for display semiconductor products, driving innovation in the sector [4]. Group 3: Company Profiles - Tata Electronics is a prominent player in the electronics manufacturing industry, established in 2020, with over 65,000 employees and operations across multiple Indian states [5]. - PSMC is the world's seventh-largest pure-play foundry, capable of producing over 2.1 million 12-inch equivalent wafers annually, and has a strong commitment to environmental governance [6][7]. - Himax Technologies is a leading fabless semiconductor solution provider, specializing in display imaging processing technologies, with a significant global market share in automotive display technology and a strong portfolio of ultralow power AI sensing solutions [8].

Core Insights - Himax Technologies, Inc. is participating in embedded world 2025, showcasing its WiseEye™ AI technology and innovative optical applications in collaboration with Liqxtal Technology Inc. [1] Group 1: WiseEye AI Technology - The WiseEye AI technology is an integrated endpoint AI solution that includes ultralow power processors, always-on CMOS image sensors, and CNN-based AI algorithms, making it suitable for various AIoT applications [2] - The latest WiseEye2 AI processor is PSA certified, emphasizing a security-by-design approach for reliable AIoT applications [2] - The WiseEye PalmVein Module utilizes bimodal authentication technology for flexible access control, achieving a False Acceptance Rate (FAR) of one in a million and a False Rejection Rate (FRR) below 1% [3] Group 2: Thermal Imaging Solutions - Himax, in partnership with Calumino, will present advanced thermal imaging sensing solutions that integrate the WiseEye AI processor and low-power CMOS image sensors, enabling applications such as people flow detection and health monitoring [4] Group 3: Liqxtal Optical Technology - Liqxtal is unveiling several patented products, including Liqxtal® Graph, Liqxtal® Dim, and Liqxtal® Pro-Eye, which enhance smart displays and wearables [5] - The Liqxtal® Pro-Eye display offers a 125-inch virtual screen experience and helps alleviate digital eye fatigue, making it suitable for various industrial applications [6] - Liqxtal® Graph features Bluetooth connectivity and allows dynamic content display on smart eyewear, while Liqxtal® Dim provides adaptive light dimming functionality for smart sunglasses [7][8]

Financial Performance - Q4 2024 revenues reached $237.2 million, a sequential increase of 6.7% and a year-over-year increase of 4.2%, exceeding guidance [8] - Gross margin for Q4 was 30.5%, up from 30% in the previous quarter and 30.3% a year ago, driven by a favorable product mix and cost improvements [8] - Q4 profit per diluted ADS was $0.14, significantly above the guidance range of $0.09 to $0.11, attributed to better-than-expected revenues and improved costs [9] - Full year 2024 revenues totaled $906.8 million, a decline of 4.1% compared to 2023, with net profit increasing to $79.8 million or $0.46 per diluted ADS, up from $50.6 million or $0.29 in 2023 [17][21] Business Line Performance - Revenue from large display drivers was $25 million, an 18.6% sequential decline due to customer destocking and price competition [9] - Small- and medium-sized display driver segment revenues totaled $166.8 million, a 7.4% sequential increase, driven by strong sales in automotive and tablet markets [10] - Non-driver sales reached $45.4 million, a 24.9% increase from the previous quarter, primarily due to a one-time Tcon product shipment [13] - Automotive driver sales saw a mid-teens increase, with TDDI sales surpassing DDIC sales for the first time, reflecting strong demand for TDDI technology [11] Market Performance - Automotive IC sales increased nearly 20% year-over-year in 2024, significantly outpacing overall automotive market growth [18] - Revenue for large panel display drivers decreased by 28.3% year-over-year, while small and medium-sized drivers saw a slight decrease of 0.6% [19] - Non-driver sales increased by 10.6% year-over-year, representing 17.1% of total sales [19] Company Strategy and Industry Competition - The company is focusing on automotive TDDI and Tcon technologies, anticipating continued growth in these areas [32] - Himax is advancing in the automotive OLED sector, with numerous projects underway in partnership with leading panel makers [32] - The company is also expanding its technology development beyond display ICs, particularly in the WiseEye AI segment [33] Management Commentary on Operating Environment and Future Outlook - Management expressed optimism about the automotive business despite ongoing macroeconomic challenges, with strict budget and expense controls implemented [16][18] - The company expects Q1 2025 revenues to decrease by 8.5% to 12.5% sequentially due to seasonal demand, but year-over-year performance is expected to range from flat to a 4.6% increase [27] - Management noted that while some peers are experiencing order pullbacks due to tariff factors, this trend has not been observed in the automotive sector [104] Other Important Information - The company had $224.6 million in cash and equivalents as of December 31, 2024, with a strong positive operating cash flow of $35.4 million for Q4 [22] - Inventory levels have declined to a healthy level of $158.7 million, down from $217.3 million a year ago [23] Q&A Session Summary Question: Update on CPO adoption and competition landscape - Management indicated that 2025 will focus on engineering validation with limited revenue contribution expected, while mass production is likely to commence in 2026 [86][91] - The potential annualized revenue for CPO could reach hundreds of millions of dollars, depending on customer demand and market penetration [91][92] Question: Automotive driver IC business outlook - The sequential decline in automotive driver IC sales is attributed to seasonal factors, with inventory levels remaining healthy [102][104] - Gross margin is expected to remain flat, influenced by product mix changes between DDIC and TDDI [105] Question: Automotive revenue mix and design wins - Management noted no significant difference in automotive revenue mix between Chinese and non-Chinese customers, with a strong market presence across major regions [108] - The design win process involves a strict definition, with timelines varying based on technology maturity and customer type [112][115]

Financial Performance - Q4 2024 revenues reached $237.2 million, a sequential increase of 6.7% and up 4.2% year over year, exceeding guidance [5][12] - Gross margin for Q4 was 30.5%, up from 30% in the previous quarter and 30.3% a year ago, driven by a favorable product mix and cost improvements [6][11] - Q4 profit per diluted ADS was $0.14, significantly above the guidance range of $0.093 to $0.11 [6] - Full year 2024 revenues totaled $906.8 million, a decline of 4.1% compared to 2023, with operating expenses down 5.6% [12][15] - Net profit for 2024 was $79.8 million or $0.46 per diluted ADS, up from $50.6 million or $0.29 per diluted ADS in 2023 [16] Business Line Performance - Revenue from large display drivers in Q4 was $25 million, an 18.6% sequential decline, attributed to customer destocking and price competition [6][7] - Small and medium-sized discrete driver segment revenue was $166.8 million, a 7.4% sequential increase, driven by strong automotive and tablet market sales [7][8] - Non-driver sales in Q4 reached $45.4 million, a 24.9% increase from the previous quarter, primarily due to a one-time product shipment [9] Market Performance - Automotive driver sales increased by nearly 20% year over year in 2024, significantly outpacing overall automotive market growth [12][22] - Automotive TDDI and key car sales surged by more than 70%, reflecting strong adoption across the board [12][13] - Revenue from large panel display drivers decreased by 28.3% year over year, accounting for 13.9% of total sales [13][14] Company Strategy and Industry Competition - The company is focusing on advancing automotive OLED technology and expanding its technology development beyond display ICs [22][23] - Himax is well-positioned in the automotive display market, with a strong emphasis on TDDI technology and partnerships with leading panel makers [36][37] - The company is also exploring opportunities in the AI and IoT sectors, with significant advancements in smart home applications and AI sensing solutions [24][42] Management Commentary on Operating Environment and Future Outlook - Management acknowledged ongoing macroeconomic challenges but emphasized strict budget and expense control measures [11] - The company expects Q1 2025 revenues to decrease by 8.5% to 12.5% sequentially due to seasonal demand [19] - Management remains optimistic about the automotive business and anticipates continued growth in TDDI and OLED technologies [22][37] Other Important Information - The company reported a strong positive operating cash flow of $35.4 million for Q4 2024 [16] - Inventory levels have declined to healthy levels, with year-end inventory at $158.7 million [17] - Capital expenditures for 2024 were $13.1 million, down from $23.4 million in 2023, primarily due to reduced spending on in-house projects [18] Q&A Session Summary Question: Updates on CPO adoption and competition landscape - Management indicated that 2025 will focus on engineering validation with limited revenue contribution, expecting mass production to commence in 2026 [55][56] - Annualized potential revenue for CPO could reach hundreds of millions of dollars, with significant demand anticipated [58][62] Question: Core driver IC business outlook - The sequential decline in Q1 is attributed to seasonal factors, with no significant changes in inventory levels reported [64][66] - Gross margin is expected to remain stable due to a favorable product mix, despite lower sales contributions from automotive [66][67]

Financial Performance - Q4 2024 revenues reached $237.2 million, a 6.7% increase QoQ, significantly exceeding guidance of a slight decrease to flat [3] - Q4 2024 gross margin was 30.5%, up from 30.0% in Q3 2024, driven by a favorable product mix and cost improvements [3] - Q4 2024 after-tax profit was $24.6 million, or 14.0 cents per diluted ADS, well above the guidance range of 9.3 to 11.0 cents [3] - Full year 2024 revenues totaled $906.8 million, with a gross margin of 30.5%, and profit attributable to shareholders was $0.46 per fully diluted ADS [13] - Profit for the period for the three months ended December 31, 2024, was $25,031 thousand, up from $23,285 thousand in 2023, reflecting an increase of approximately 7.5% [66] - Profit for the period increased to $79,770 million in 2024 from $49,421 million in 2023, representing a growth of 61.3% [69] Revenue Guidance and Projections - Q1 2025 revenue guidance indicates a decline of 8.5% to 12.5% QoQ, reflecting low season demand due to Lunar New Year holidays [3] - Himax expects Q1 2025 Tcon sales to decrease mid-teens sequentially, primarily due to the non-recurrence of a one-time shipment to a leading projector customer [39] - Himax's Q1 2025 guidance indicates a net revenue decrease of 8.5% to 12.5% QoQ, but a flat to 4.6% increase YoY, with a gross margin around 30.5% [51] - Profit for Q1 2025 is projected to be between 9.0 cents to 11.0 cents per diluted ADS, representing a year-over-year increase of 26% to 54% [51] Market and Product Developments - Automotive driver IC sales increased nearly 20% YoY in 2024, significantly outpacing global automotive growth, with Himax holding over 50% market share in automotive TDDI [13] - Himax is advancing development in automotive OLED technology, which is expected to be a key growth driver in the coming years [22] - Himax's automotive driver IC sales increased nearly 20% year-over-year in 2024, significantly outpacing global automotive growth [31] - The company anticipates a single-digit sequential sales increase for large display driver ICs in Q1 2025, driven by demand from Chinese government subsidies for household appliances [29] - Himax's CPO technology is expected to see accelerated adoption in high-performance AI applications, with increased trial production volume forecasts from customers [25] - Himax's WiseEye AI segment anticipates strong growth in 2025, with notable progress in smart home applications and collaborations with leading brands [23] - The latest Front-lit LCoS Microdisplay technology offers an industry-leading brightness of 400k nits, positioning Himax as a key player in the AR glasses market [26] - Himax is well-positioned to capture new growth opportunities in the automotive OLED market, leveraging strategic partnerships with leading panel makers [35] Operating Expenses and Financial Health - Operating expenses for 2024 were $208.0 million, a decline of 5.6% from 2023, primarily due to lower employee bonus compensation [16] - Total current assets decreased to $1,168,043 thousand as of December 31, 2024, from $1,200,585 thousand in 2023, a decline of approximately 2.7% [63] - Cash and cash equivalents increased to $218,148 thousand from $191,749 thousand, representing a growth of about 13.7% year-over-year [63] - Total liabilities decreased to $743,194 thousand as of December 31, 2024, from $779,702 thousand in 2023, a reduction of about 4.7% [64] - Retained earnings increased to $664,600 thousand from $640,447 thousand, marking a growth of approximately 3.4% year-over-year [64] - Total equity attributable to owners of Himax Technologies increased to $890,061 thousand from $856,768 thousand, an increase of approximately 3.9% [64] Cash Flow and Investments - Net cash provided by operating activities for the three months ended December 31, 2024, was $35,417 thousand, compared to $68,742 thousand in 2023, indicating a decrease of about 48.5% [67] - The company reported a cash flow from investing activities of $(4,626) thousand for the three months ended December 31, 2024, compared to $(22,987) thousand in 2023, showing an improvement [67] - Cash generated from operating activities decreased to $119,397 million from $203,420 million, a decline of 41.3% [69] - Net cash used in investing activities was $(516) million, significantly improved from $(88,882) million in the previous year [70] - Payments of cash dividends decreased to $50,670 million from $83,720 million, a reduction of 39.5% [70] - Proceeds from short-term secured borrowings increased to $1,780,300 million from $1,383,300 million, an increase of 28.7% [70] Inventory and Depreciation - The company’s inventories decreased to $158,746 thousand from $217,308 thousand, a decline of approximately 27% year-over-year [63] - Total depreciation and amortization expenses rose to $22,354 million from $20,322 million, an increase of 10.0% [69] - Inventories write downs decreased to $13,551 million from $21,540 million, a reduction of 37.0% [69]

Core Insights - Himax Technologies, Inc. reported Q4 2024 revenues of $237.2 million, exceeding guidance and reflecting a 6.7% increase QoQ and 4.2% YoY [4][6] - The company anticipates Q1 2025 revenues to decline by 8.5% to 12.5% QoQ, but expects a flat to 4.6% increase YoY [1][51] - Gross margin for Q4 2024 reached 30.5%, surpassing guidance and up from 30.0% in Q3 2024 [4][6] Financial Performance - Q4 2024 after-tax profit was $24.6 million, or 14.0 cents per diluted ADS, significantly above the guidance range of 9.3 to 11.0 cents [4][11] - Full year 2024 revenues totaled $906.8 million, with a gross margin of 30.5%, up from 27.9% in 2023 [13][15] - Operating expenses for 2024 decreased by 5.6% to $208.0 million, primarily due to lower employee bonus compensation [16][10] Product Segments - Automotive driver IC sales increased nearly 20% YoY in 2024, significantly outpacing global automotive growth, with Himax holding over 50% market share in automotive TDDI [13][22] - Revenue from large display drivers fell 18.6% sequentially due to customer destocking and price competition [7] - Small and medium-sized display driver segment saw a 7.4% sequential increase, driven by strong automotive and tablet market sales [8] Technology and Innovation - Himax showcased advancements in automotive display technology, WiseEye AI, and optical technologies for AR/VR at CES 2025, highlighting a growing trend in AR glasses [3][26] - The company is advancing its proprietary wafer-level optics (WLO) technology for co-packaged optics (CPO), which is expected to enhance data transmission capabilities [24][46] - WiseEye AI technology is gaining traction in various applications, including smart door locks and AIoT solutions, with significant market success anticipated [41][42] Market Outlook - Himax expects continued growth in its automotive TDDI and Tcon technologies, positioning itself well for future market demands [22][36] - The company is actively expanding its technology development beyond display ICs, with a strong growth trajectory anticipated in the WiseEye business [23][41] - Himax is well-positioned to capitalize on the trend of premium notebooks adopting OLED displays and touch features, driven by the rise of AI PCs [31][36]