Financial Performance - Q1 2025 revenue was $215.1 million, a sequential decrease of 9.3% but a year-over-year increase of 3.7% [6][7] - Gross margin was 30.5%, consistent with guidance and up from 29.3% year-over-year [6][7] - Q1 profit per diluted ADS was $0.01, exceeding guidance due to lower operating expenses [7][12] - Operating income was $19.8 million, representing 9.2% of sales, compared to 4.8% a year ago [12] - Cash and cash equivalents were $281 million, up from $277.4 million a year ago [13] Business Line Performance - Revenue from large display drivers was $25 million, flat from the previous quarter, driven by demand from Chinese government subsidies [7][9] - Small and medium-sized display driver revenue totaled $150.5 million, reflecting a sequential decline of 9.8% [9][10] - Automotive driver IC sales rose nearly 20% year-over-year, making it the largest revenue contributor [10][11] - Non-driver sales reached $39.6 million, a 12.8% decrease from the previous quarter [10][11] Market Performance - Automotive IC sales showed resilience with a single-digit decline, while overall automotive driver IC sales rose nearly 20% year-over-year [9][10] - Smartphone and tablet driver sales declined as expected amid a subdued festival season [10][11] - The automotive market remains a key focus, with Himax holding a 40% share in DDIC and over 50% in TDDI [34][36] Company Strategy and Industry Competition - Himax is focusing on maintaining a healthy balance sheet while driving sustainable long-term growth through high dividends and share repurchases [15] - The company is deepening its supply chain in Taiwan and strengthening its presence in China, Korea, and Singapore to mitigate geopolitical risks [24][25] - Himax is committed to innovative fields such as ultra-low power AI, AR glasses, and co-packaged optics, which are expected to contribute to revenue growth [26][28] Management Commentary on Operating Environment and Future Outlook - Management expressed concerns about macroeconomic uncertainties and the impact of U.S. tariffs on customer demand [19][24] - The company anticipates a conservative revenue outlook for Q2 2025, reflecting cautious customer sentiment amid global economic uncertainties [24][60] - Despite challenges, Himax remains confident in its growth potential in new technology areas, particularly TDDI and TCOM [62] Other Important Information - The company announced an annual cash dividend of $0.037 per ADS, totaling $64.5 million, with a payout ratio of 81.1% of the previous year's profits [15] - Capital expenditures for Q1 were $5.2 million, primarily for R&D related equipment [15] Q&A Session Summary Question: Could you explain the validation process for CPO? - The validation process involves collaboration with leading customers and foundry partners, focusing on current and newly developed products [56] Question: Do you have guidance for 2025? - The company does not provide full-year guidance due to macroeconomic uncertainties but acknowledges low visibility for the second half of the year [59][60] Question: What is the outlook for the automotive market? - Management noted concerns about the effectiveness of future government stimulus programs in China and the potential impact on automotive demand [60][62] Question: Comment on the Obsidian investment? - The investment aligns with Himax's technology, enhancing thermal imaging capabilities and offering unique applications [63][64]

Financial Performance - Q1 2025 revenue was $215.1 million, a sequential decrease of 9.3% but a year-over-year increase of 3.7% [6] - Gross margin was 30.5%, consistent with guidance and up from 29.3% year-over-year [6][12] - Profit per diluted ADS was $0.01, exceeding guidance due to lower operating expenses [7] - Operating income was $19.8 million, representing 9.2% of sales, compared to 4.8% a year ago [12] - Cash and cash equivalents totaled $281 million, up from $277.4 million a year ago [13] Business Line Performance - Revenue from large display drivers was $25 million, flat from the previous quarter, driven by demand from Chinese government subsidies [7] - Small and medium-sized display driver revenue was $150.5 million, reflecting a sequential decline of 9.8% [10] - Automotive driver IC sales rose nearly 20% year-over-year, making it the largest revenue contributor, accounting for over 15% of total sales [10][26] - Non-driver sales reached $39.6 million, a 12.8% decrease from the previous quarter [11] Market Performance - Automotive IC sales showed resilience with a single-digit decline, while overall automotive driver IC sales are expected to decline mid-teens sequentially in Q2 [10][31] - Smartphone and tablet driver sales are expected to decline mid-teens and grow high teens respectively in Q2 [34] - The company is expanding its presence in the OLED market, particularly in automotive applications [35] Company Strategy and Industry Competition - The company is focusing on maintaining a healthy balance sheet while driving sustainable long-term growth through high dividends and share repurchases [15] - Himax is deepening its supply chain in Taiwan and strengthening its presence in China, Korea, and Singapore to mitigate geopolitical risks [24] - The company is committed to innovative fields such as ultra-low power AI and AR glasses, which are expected to contribute to revenue growth [27] Management Commentary on Operating Environment and Future Outlook - Management expressed concerns over macroeconomic uncertainties and the impact of U.S. tariffs on customer demand [22][58] - The company anticipates low visibility for the second half of the year due to ongoing tariff negotiations and economic conditions [57] - Despite challenges, Himax expects to achieve growth in new technology areas such as TDDI and TCOM, where it holds a significant market share [60] Other Important Information - The company announced an annual cash dividend of $0.037 per ADS, totaling $64.5 million, with a payout ratio of 81.1% of the previous year's profits [15] - Capital expenditures for Q1 were $5.2 million, primarily for R&D related equipment [15] Q&A Session Summary Question: Could you explain the validation process for CPO? - The validation process involves collaboration with leading customers and foundry partners, focusing on current and newly developed products [53] Question: Do you have guidance for 2025? How do you see demand in the second half? - The company does not provide full-year guidance but notes low visibility due to macro uncertainties and customer concerns regarding government stimulus effectiveness [57][58] Question: Comment on the Obsidian investment. - The investment in Obsidian is seen as a strategic fit due to its unique thermal imaging technology complementing Himax's CMOS image sensors [61][63]

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]