Silicon Motion(US:SIMO)2024-05-03 10:30Financial Performance - First quarter 2024 net sales were $189.3 million, a decrease of 6% Q/Q but an increase of 53% Y/Y[4] - Q1 2024 GAAP net income was $16.0 million, or $0.48 per diluted ADS, down from $21.1 million, or $0.63 per diluted ADS in Q4 2023[4][5] - For Q2 2024, management expects revenue between $199 million and $208 million, representing a Q/Q increase of 5% to 10% and a Y/Y increase of 42% to 48%[10] - For the full year 2024, revenue is expected to be between $800 million and $830 million, reflecting a Y/Y increase of 25% to 30%[11] - Q1 2024 gross margin was 45.0%, with an expected range of 45.0% to 46.0% for Q2 2024[10] - Operating margin for Q1 2024 was 9.5%, with an expected range of 15.0% to 16.3% for Q2 2024[10] - Gross profit for the same period was $85,120 thousand, resulting in a gross margin of 45.0%, up from 43.7% in the previous quarter[19] - Operating income for the three months ended March 31, 2024, was $17,950 thousand, with an operating margin of 9.5%[19] - Net income for the period was $16,016 thousand, translating to earnings per diluted ADS of $0.48[19] Sales and Product Performance - SSD controller sales in Q1 2024 increased by 0% to 5% Q/Q and by 35% to 40% Y/Y[3] - eMMC+UFS controller sales in Q1 2024 decreased by 10% to 15% Q/Q but increased by 235% to 240% Y/Y[3] - The company plans to scale new SSD and eMMC+UFS controller programs to improve ASPs and profitability throughout 2024[9] Capital Expenditures and Assets - Capital expenditures in Q1 2024 totaled $10.7 million, including $5.0 million for routine purchases and $5.7 million for building construction[8] - Total current assets increased to $801,838 thousand as of March 31, 2024, compared to $793,245 thousand at the end of the previous quarter[24] - Cash and cash equivalents decreased to $294,814 thousand from $314,302 thousand in the previous quarter[24] - The company reported a net cash provided by operating activities of $7,811 thousand for the three months ended March 31, 2024[27] - Research and development expenses for the period were $54,392 thousand, reflecting ongoing investment in new technologies[19] - The company’s total liabilities decreased slightly to $270,820 thousand as of March 31, 2024, from $273,265 thousand at the end of the previous quarter[24] Market Position and Risks - Silicon Motion continues to lead in supplying NAND flash controllers, indicating strong market positioning and potential for future growth[28] - The company acknowledges potential risks and uncertainties affecting future performance, including unpredictable customer order volumes and economic conditions[29] - Ongoing US-China tariffs and trade disputes may impact the company's business operations and customer relationships[29] - Supply chain disruptions and raw material shortages are currently affecting the industry, which could influence product availability and pricing[31] - The company emphasizes the importance of timely development and introduction of new or enhanced products to maintain competitive advantage[31] - There is a potential for impairment charges related to previously acquired or divested businesses, which could affect financial results[31] - The company does not intend to update or revise forward-looking statements unless required by securities laws, indicating a stable outlook for current projections[31] - The company is focused on monitoring customer sales outlook and purchasing patterns to adjust inventory accordingly[31] - The impact of inflation on both the company and its customers' businesses is a concern that could affect overall economic activity[29] - The company is prepared for potential changes in cash dividend payments at the discretion of its board of directors[29] - The company is closely watching the geopolitical tensions between Taiwan and China, which may have implications for its operations[29]