GSI Technology(US:GSIT)2019-11-05 21:10Revenue Performance - Revenues decreased by 8.5% from $12.8 million in Q3 2018 to $11.7 million in Q3 2019, while revenues increased by 2.7% from $24.1 million in the first half of 2018 to $24.8 million in the first half of 2019[109] - Direct and indirect sales to Nokia, the largest customer, decreased from $6.0 million in Q3 2018 to $5.3 million in Q3 2019, but increased from $11.2 million in the first half of 2018 to $11.3 million in the first half of 2019[109] - Future sales to Nokia are expected to fluctuate significantly on a quarterly basis, impacting overall revenues[98] Profitability Metrics - Gross profit decreased by 18.2% from $8.0 million in Q3 2018 to $6.6 million in Q3 2019, while it increased by 7.2% from $13.8 million in the first half of 2018 to $14.8 million in the first half of 2019[111] - Gross margin decreased from 62.6% in Q3 2018 to 55.9% in Q3 2019, but increased from 57.4% in the first half of 2018 to 59.8% in the first half of 2019[112] - Net loss increased from $351,000 in Q3 2018 to $1.8 million in Q3 2019, and decreased from $2.0 million in the first half of 2018 to $1.9 million in the first half of 2019[117] Expenses Overview - Research and development expenses were unchanged at $5.8 million in Q3 2018 and Q3 2019, but increased by 7.8% from $10.6 million in the first half of 2018 to $11.4 million in the first half of 2019[113] - Selling, general and administrative expenses remained unchanged at $2.7 million for the three months ended September 30, 2018, and 2019, while increasing by 5.0% from $5.3 million to $5.5 million for the six months ended September 30, 2018, and 2019[114] Cash Flow and Liquidity - As of September 30, 2019, cash, cash equivalents, and short-term investments totaled $68.1 million, up from $61.8 million as of March 31, 2019[118] - Net cash used in operating activities was $1.1 million for the first half of 2019, compared to $620,000 for the first half of 2018[119] - Net cash provided by investing activities was $1.2 million in the first half of 2019, compared to net cash used of $3.2 million in the first half of 2018[123] - Net cash provided by financing activities was $3.1 million in the first half of 2019, compared to $2.2 million in the first half of 2018[125] Other Financial Metrics - Interest and other income, net increased by 44.8% from $145,000 in Q3 2018 to $210,000 in Q3 2019, and by 112.5% from $168,000 in the first half of 2018 to $357,000 in the first half of 2019[115] - Provision for income taxes decreased by 46.1% from $102,000 in Q3 2018 to $55,000 in Q3 2019, and by 12.5% from $112,000 in the first half of 2018 to $98,000 in the first half of 2019[116] - The overall average selling price of units shipped increased by 1.0% in Q3 2019 compared to Q3 2018 and increased by 16.6% in the first half of 2019 compared to the first half of 2018[109] - Shipments of the SigmaQuad product line accounted for 63.5% of total shipments in Q3 2019, down from 66.4% in Q3 2018[109] - The company has no debt and substantial liquidity, positioning it better than many peers in the semiconductor industry[98] - The accrual for potential contingent consideration related to the acquisition of MikaMonu was $4.3 million as of September 30, 2019[130] - The estimated annual effective income tax rate was approximately (2.3%) as of September 30, 2019[126]