Pixelworks(PXLW) - 2024 Q4 - Annual Results

Revenue Performance - Fourth quarter revenue was $9.1 million, down from $20.1 million in Q4 2023, primarily due to lower mobile business sales, partially offset by a 14% sequential and 5% year-over-year increase in home and enterprise market revenue [6]. - For the full year 2024, total revenue was $43.2 million, down from $59.7 million in 2023, reflecting lower contributions from the mobile business [6]. - Revenue for the three months ended December 31, 2024, was $9,090 million, a decrease of 4.6% from $9,527 million in the previous quarter [24]. Profitability and Loss - The company recorded a GAAP net loss of $5.4 million, or ($0.09) per share, compared to a net loss of $3.7 million, or ($0.07) per share, in Q4 2023 [10]. - Pixelworks, Inc. reported a GAAP net loss of $5,363,000 for the three months ended December 31, 2024, compared to a loss of $3,744,000 for the same period in 2023, reflecting an increase in losses of approximately 43.3% year-over-year [29]. - The company's adjusted EBITDA for the twelve months ended December 31, 2024, was a loss of $20,078,000, compared to a loss of $18,786,000 for the previous year, indicating a year-over-year increase in losses of about 6.9% [29]. Margins and Profitability Metrics - Gross margin for Q4 2024 was 54.6%, an increase from 44.7% in Q4 2023, marking the fourth consecutive quarter of margin expansion [8]. - Non-GAAP gross profit margin for Q4 2024 was 54.8%, up from 44.8% in Q4 2023 [9]. - Non-GAAP gross profit margin improved to 54.8% for the three months ended December 31, 2024, compared to 51.3% in the previous quarter [25]. Expenses and Cost Management - Research and development expenses for the three months ended December 31, 2024, were $6,916 million, compared to $8,405 million in the previous quarter, a decrease of 17.6% [24]. - Total operating expenses for the twelve months ended December 31, 2024, were $53,642 million, slightly down from $54,345 million in the previous year [24]. - Pixelworks aims to achieve profitability for its Shanghai subsidiary in the full year 2025 through cost reduction and new revenue opportunities [5]. Assets and Liabilities - Total current assets decreased to $34,852,000 as of December 31, 2024, down from $64,725,000 in 2023, representing a decline of approximately 46.1% [31]. - Cash and cash equivalents significantly dropped to $23,647,000 in 2024 from $47,544,000 in 2023, a decrease of about 50.3% [31]. - Total liabilities decreased to $24,194,000 in 2024 from $30,957,000 in 2023, reflecting a reduction of approximately 21.8% [31]. - The company’s total assets decreased to $64,072,000 in 2024 from $95,969,000 in 2023, a decline of approximately 33.2% [31]. - The company’s total shareholders' equity turned negative at $(10,568,000) in 2024, down from $12,541,000 in 2023, indicating a significant decline in equity [31]. Government Support and Future Outlook - The Pixelworks Shanghai subsidiary received $1.8 million in cash subsidies as part of China's "Little Giant" program [7]. - The company expects renewed mobile growth to begin in Q1 2025, with an accelerating ramp of production shipments starting in Q2 2025 [4]. - The company is focused on multiple customer programs for new smartphone models utilizing its latest mobile visual processor solutions [4].