UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
under the Securities Exchange Act of 1934
October 26, 2017
Commission File Number: 000-51380
Silicon Motion Technology Corporation
(Exact name of Registrant as specified in its charter)
Unit 04-05, 27/F, #909 Cheung Sha Wan Rd.
Cheung Sha Wan, Kowloon
Hong Kong
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:
Form 20-F ☒ Form 40-F ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):
Yes ☐ No ☒
Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):
Yes ☐ No ☒
Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.
Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:
Yes ☐ No ☒
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):
Not applicable
Exhibits
| Exhibit 99.1 | Press Release issued by the Company on October 26, 2017. |
2
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| SILICON MOTION TECHNOLOGY CORPORATION | ||||||
| Date: October 26, 2017 | By: |
| ||||
| Name: Riyadh Lai | ||||||
| Title: Chief Financial Officer | ||||||
3
Exhibit 99.1
|
Silicon Motion Announces Results for the Period Ended September 30, 2017 |
NEWS RELEASE
Financial Highlights
| 3Q 2017 GAAP |
3Q 2017 Non-GAAP | |||
| • Net sales |
$127.2 million (-4% Q/Q, -20% Y/Y) | $127.2 million (-4% Q/Q, -20% Y/Y) | ||
| • Gross margin |
46.0% | 46.0% | ||
| • Operating margin |
17.0% | 20.0% | ||
| • Earnings per diluted ADS |
$0.49 | $0.57 |
Business Highlights
| • | Embedded Storage1 sales decreased approximately 5% Q/Q and accounted for about 80% of total sales, similar to the previous quarter |
| • | Client SSD controller sales decreased approximately 10% Q/Q |
| • | eMMC controller sales decreased approximately 20% Q/Q |
| • | SSD solutions sales increased approximately 50% Q/Q |
| • | Began shipping our SATA3 SSD controller to Micron for the Crucial BX300 SSD |
| • | Began commercial sales of our 2nd generation PCIe NVMe client SSD controllers |
TAIPEI, Taiwan and MILPITAS, Calif., October 27, 2017 – Silicon Motion Technology Corporation (NasdaqGS: SIMO) (“Silicon Motion” or the “Company”) today announced its financial results for the quarter ended September 30, 2017. For the third quarter, net sales decreased 4% sequentially to $127.2 million from $132.7 million in the second quarter. Net income (GAAP) decreased to $17.6 million or $0.49 per diluted ADS (GAAP) from a net income (GAAP) of $24.0 million or $0.67 per diluted ADS (GAAP) in the second quarter.
For the third quarter, net income (non-GAAP) decreased to $20.3 million or $0.57 per diluted ADS (non-GAAP) from a net income (non-GAAP) of $25.4 million or $0.71 per diluted ADS (non-GAAP) in the second quarter.
| 1 | Embedded Storage comprises primarily eMMC and client SSD controllers and enterprise and industrial SSD solutions. |
1
Third Quarter 2017 Review
“This quarter, NAND flash industry supply increased materially, which enabled us to significantly increase procurement of NAND for both our differentiated Ferri and Shannon SSD solutions,” said Wallace Kou, President and CEO of Silicon Motion. “Despite supply improvements, NAND prices remained elevated and high prices, as expected, continued to temporarily affect broader adoption of client SSDs. Our eMMC controller sales declined as previously communicated, the result of our NAND flash partner re-balancing their limited NAND supply away from mobile phones and towards other applications.”
Sales
| (in millions, except percentages) |
3Q 2017 | 2Q 2017 | 3Q 2016 | |||||||||||||||||||||
| Sales | Mix | Sales | Mix | Sales | Mix | |||||||||||||||||||
| Mobile Storage* |
$ | 117.2 | 92 | % | $ | 121.6 | 92 | % | $ | 146.9 | 93 | % | ||||||||||||
| Q/Q |
-4 | % | 4 | % | 13 | % | ||||||||||||||||||
| Y/Y |
-20 | % | -6 | % | 82 | % | ||||||||||||||||||
| Mobile Communications** |
$ | 8.7 | 7 | % | $ | 10.0 | 7 | % | $ | 10.1 | 6 | % | ||||||||||||
| Others |
$ | 1.3 | 1 | % | $ | 1.2 | 1 | % | $ | 1.6 | 1 | % | ||||||||||||
| Total revenue |
$ | 127.2 | 100 | % | $ | 132.7 | 100 | % | $ | 158.6 | 100 | % | ||||||||||||
| Q/Q |
-4 | % | 4 | % | 13 | % | ||||||||||||||||||
| Y/Y |
-20 | % | -6 | % | 66 | % | ||||||||||||||||||
| * | Mobile Storage products include Embedded Storage products (eMMC and client SSD controllers and enterprise and industrial SSD solutions) and Expandable Storage products (SD and USB flash drive controllers) |
| ** | Mobile Communications products include mobile TV SoCs and handset transceivers |
Key Financial Results
| (in millions, except percentages and per ADS amounts) |
GAAP | Non-GAAP | ||||||||||||||||||||||
| 3Q 2017 | 2Q 2017 | 3Q 2016 | 3Q 2017 | 2Q 2017 | 3Q 2016 | |||||||||||||||||||
| Revenue |
$ | 127.2 | $ | 132.7 | $ | 158.6 | $ | 127.2 | $ | 132.7 | $ | 158.6 | ||||||||||||
| Gross profit |
$ | 58.5 | $ | 64.6 | $ | 77.4 | $ | 58.5 | $ | 64.6 | $ | 77.6 | ||||||||||||
| Percent of revenue |
46.0 | % | 48.7 | % | 48.8 | % | 46.0 | % | 48.7 | % | 48.9 | % | ||||||||||||
| Operating expenses |
$ | 36.9 | $ | 34.3 | $ | 38.9 | $ | 33.1 | $ | 32.8 | $ | 32.0 | ||||||||||||
| Operating income |
$ | 21.6 | $ | 30.3 | $ | 38.5 | $ | 25.4 | $ | 31.8 | $ | 45.5 | ||||||||||||
| Percent of revenue |
17.0 | % | 22.8 | % | 24.3 | % | 20.0 | % | 23.9 | % | 28.7 | % | ||||||||||||
| Earnings per diluted ADS |
$ | 0.49 | $ | 0.67 | $ | 0.92 | $ | 0.57 | $ | 0.71 | $ | 1.07 | ||||||||||||
2
Other Financial Information
| (in millions) |
3Q 2017 | 2Q 2017 | 3Q 2016 | |||||||||
| Cash and cash equivalents, and short-term investments |
$ | 332.8 | $ | 306.0 | $ | 269.2 | ||||||
| Bank loans |
— | $ | 25.0 | $ | 35.0 | |||||||
| Capital expenditures |
$ | 3.0 | $ | 2.1 | $ | 2.8 | ||||||
| Dividend payments |
$ | 7.1 | $ | 7.1 | $ | 5.3 | ||||||
| Loan repayments |
$ | 25.0 | — | — | ||||||||
During the third quarter, we had $3.0 million of capital expenditures for the routine purchase of software and design tools. We paid $2.9 million for the acquisition of Bigtera, a software defined storage company.
Our third quarter cash flows were as follows:
| 3 months ended Sep. 30, 2017 | ||||
| (In $ millions) | ||||
| Net income (GAAP) |
17.6 | |||
| Depreciation & amortization |
3.2 | |||
| Changes in operating assets and liabilities |
13.8 | |||
| Others |
2.9 | |||
|
|
|
|||
| Net cash provided by operating activities |
37.5 | |||
|
|
|
|||
| Acquisition of property and equipment |
(3.0 | ) | ||
| Acquisition of Bigtera |
(2.9 | ) | ||
|
|
|
|||
| Net cash used in investing activities |
(5.9 | ) | ||
|
|
|
|||
| Dividend |
(7.1 | ) | ||
| Loans |
(25.0 | ) | ||
|
|
|
|||
| Net cash used in financing activities |
(32.1 | ) | ||
|
|
|
|||
| Effects of changes in foreign currency exchange rates on cash |
0.1 | |||
|
|
|
|||
| Net decrease in cash, cash equivalents and restricted cash |
(0.4 | ) | ||
|
|
|
|||
Returning Value to Shareholders
On October 24, 2016, the Board of Directors of the Company declared a $0.80 per ADS annual dividend to be paid in quarterly installments of $0.20 per ADS. On August 17, 2017, we paid $7.1 million to shareholders as the fourth installment of our annual dividend. On October 24, 2017, the Board of Directors of the Company declared a $1.20 per ADS annual dividend to be paid in quarterly installments of $0.30 per ADS. The first installment of our new annual dividend will be paid on November 23, 2017.
3
On August 1, 2017, the Company announced that its Board of Directors has authorized a new program for the Company to repurchase up to $200 million of its ADS over a 12 month period. In the third quarter, the Company did not repurchase any shares.
Business Outlook
“We expect our business to gradually rebound in the fourth quarter, and rebound further next year due to increasing availability of 64L 3D NAND and more competitive NAND pricing,” said Wallace Kou, President and CEO of Silicon Motion. “In the fourth quarter, we expect our Ferri and Shannon SSD solutions customers to take advantage of improving supply of NAND flash to procure more than originally forecasted. We expect our client SSD controller sales to increase strongly in the fourth quarter as our pipeline of 2nd generation PCIe NVMe client SSD controllers start entering production.”
For the fourth quarter of 2017, management expects:
| GAAP |
Non-GAAP Adjustment |
Non-GAAP | ||||
| Revenue |
$130m to $136m 2% to 7% Q/Q |
— | $130m to $136m 2% to 7% Q/Q | |||
| Gross margin |
45.4% to 47.4% | Approximately $0.2m* | 45.5% to 47.5% | |||
| Operating margin |
13.2% to 15.5%** | Approximately $8.7m to 8.8m*** | 20.0% to 22.0% |
| * | Projected gross margin (non-GAAP) excludes $0.2 million of stock-based compensation. |
| ** | Projected operating margin (GAAP) excludes potential impairment charges relating to FCI, which came to our attention after the end of the third quarter and which we are currently in the process of evaluating. The total carrying cost of FCI at the end of the third quarter 2017 is $35.5 million. |
| *** | Projected operating margin (non-GAAP) excludes $0.5 million of amortization of intangible assets, and $8.2 million to $8.3 million of stock-based compensation. |
4
Conference Call & Webcast:
The Company’s management team will conduct a conference call at 8:00 am Eastern Time on October 27, 2017.
Speakers
Wallace Kou, President & CEO
Riyadh Lai, CFO
Jason Tsai, Senior Director of Investor Relations and Strategy
CONFERENCE CALL ACCESS NUMBERS:
USA (Toll Free): 1 866 519 4004
USA (Toll): 1 845 675 0437
Taiwan (Toll Free): 0080 112 6920
Participant Passcode: 9227 0229
REPLAY NUMBERS (for 7 days):
USA (Toll Free): 1 855 452 5696
USA (Toll): 1 646 254 3697
Participant Passcode: 9227 0229
A webcast of the call will be available on the Company’s website at www.siliconmotion.com.
5
Discussion of Non-GAAP Financial Measures
To supplement the Company’s unaudited selected financial results calculated in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”), the Company discloses certain non-GAAP financial measures that exclude stock-based compensation and other items, including gross profit (non-GAAP), operating expenses (non-GAAP), operating profit (non-GAAP), net income (non-GAAP), and earnings per diluted ADS (non-GAAP). These non-GAAP measures are not in accordance with or an alternative to GAAP, and may be different from non-GAAP measures used by other companies. We believe that these non-GAAP measures have limitations in that they do not reflect all the amounts associated with the Company’s results of operations as determined in accordance with GAAP and that these measures should only be used to evaluate the Company’s results of operations in conjunction with the corresponding GAAP measures. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the most directly comparable GAAP measure. We compensate for the limitations of our non-GAAP financial measures by relying upon GAAP results to gain a complete picture of our performance.
Our non-GAAP financial measures are provided to enhance the user’s overall understanding of our current financial performance and our prospects for the future. Specifically, we believe the non-GAAP results provide useful information to both management and investors as these non-GAAP results exclude certain expenses, gains and losses that we believe are not indicative of our core operating results and because it is consistent with the financial models and estimates published by many analysts who follow the Company. We use non-GAAP measures to evaluate the operating performance of our business, for comparison with our forecasts, and for benchmarking our performance externally against our competitors. Also, when evaluating potential acquisitions, we exclude the items described below from our consideration of the target’s performance and valuation. Since we find these measures to be useful, we believe that our investors benefit from seeing the results from management’s perspective in addition to seeing our GAAP results. We believe that these non-GAAP measures, when read in conjunction with the Company’s GAAP financials, provide useful information to investors by offering:
| • | the ability to make more meaningful period-to-period comparisons of the Company’s on-going operating results; |
| • | the ability to better identify trends in the Company’s underlying business and perform related trend analysis; |
| • | a better understanding of how management plans and measures the Company’s underlying business; and |
| • | an easier way to compare the Company’s operating results against analyst financial models and operating results of our competitors that supplement their GAAP results with non-GAAP financial measures. |
6
The following are explanations of each of the adjustments that we incorporate into our non-GAAP measures, as well as the reasons for excluding each of these individual items in our reconciliation of these non-GAAP financial measures:
Stock-based compensation expense consists of non-cash charges related to the fair value of restricted stock units awarded to employees. The Company believes that the exclusion of these non-cash charges provides for more accurate comparisons of our operating results to our peer companies due to the varying available valuation methodologies, subjective assumptions and the variety of award types. In addition, the Company believes it is useful to investors to understand the specific impact of share-based compensation on its operating results.
Amortization of intangibles assets consists of non-cash charges that can be impacted by the timing and magnitude of our acquisitions. The Company considers its operating results without these charges when evaluating its ongoing performance and forecasting its earnings trends, and therefore excludes such charges when presenting non-GAAP financial measures. The Company believes that the assessment of its operations excluding these costs is relevant to its assessment of internal operations and comparisons to the performance of its competitors.
Litigation expenses consist of legal expenses relating to intellectual property disputes, commercial claims and other types of litigation. While litigation may arise in the ordinary course of our business, we nevertheless consider litigation to be an unusual and unplanned activity and therefore exclude this charge when presenting non-GAAP financial measures.
Foreign exchange gains and losses consist of translation gains and/or losses of non-US$ denominated current assets and current liabilities, as well as certain other balance sheet items which result from the appreciation or depreciation of non-US$ currencies against the US$. We do not use financial instruments to manage the impact on our operations from changes in foreign exchange rates, and because our operations are subject to fluctuations in foreign exchange rates, we therefore exclude foreign exchange gains and losses when presenting non-GAAP financial measures.
7
Silicon Motion Technology Corporation
Consolidated Statements of Income
(in thousands, except percentages and per ADS data, unaudited)
| For the Three Months Ended | ||||||||||||
| Sep. 30, 2016 ($) |
Jun. 30, 2017 ($) |
Sep. 30, 2017 ($) |
||||||||||
| Net Sales |
158,580 | 132,732 | 127,216 | |||||||||
| Cost of sales |
81,175 | 68,121 | 68,746 | |||||||||
|
|
|
|
|
|
|
|||||||
| Gross profit |
77,405 | 64,611 | 58,470 | |||||||||
| Operating expenses |
||||||||||||
| Research & development |
25,934 | 24,476 | 25,293 | |||||||||
| Sales & marketing |
7,548 | 5,588 | 7,157 | |||||||||
| General & administrative |
4,878 | 3,750 | 3,917 | |||||||||
| Amortization of intangibles assets |
526 | 526 | 526 | |||||||||
|
|
|
|
|
|
|
|||||||
| Operating income |
38,519 | 30,271 | 21,577 | |||||||||
| Non-operating income (expense) |
||||||||||||
| Interest income, net |
541 | 958 | 993 | |||||||||
| Foreign exchange gain (loss), net |
(375 | ) | (65 | ) | 701 | |||||||
| Others, net |
28 | (7 | ) | 32 | ||||||||
|
|
|
|
|
|
|
|||||||
| Subtotal |
194 | 886 | 1,726 | |||||||||
|
|
|
|
|
|
|
|||||||
| Income before income tax |
38,713 | 31,157 | 23,303 | |||||||||
| Income tax expense |
5,991 | 7,124 | 5,709 | |||||||||
|
|
|
|
|
|
|
|||||||
| Net income |
32,722 | 24,033 | 17,594 | |||||||||
|
|
|
|
|
|
|
|||||||
| Earnings per basic ADS |
$ | 0.93 | $ | 0.67 | $ | 0.49 | ||||||
| Earnings per diluted ADS |
$ | 0.92 | $ | 0.67 | $ | 0.49 | ||||||
| Margin Analysis: |
||||||||||||
| Gross margin |
48.8 | % | 48.7 | % | 46.0 | % | ||||||
| Operating margin |
24.3 | % | 22.8 | % | 17.0 | % | ||||||
| Net margin |
20.6 | % | 18.1 | % | 13.8 | % | ||||||
| Additional Data: |
||||||||||||
| Weighted avg. ADS equivalents2 |
35,308 | 35,741 | 35,766 | |||||||||
| Diluted ADS equivalents |
35,539 | 35,801 | 35,828 | |||||||||
| 2 | Assumes all outstanding ordinary shares are represented by ADSs. Each ADS represents four ordinary shares. |
8
Silicon Motion Technology Corporation
Reconciliation of GAAP to Non-GAAP Operating Results
(in thousands, except percentages and per ADS data, unaudited)
| For the Three Months Ended | ||||||||||||
| Sep. 30, 2016 ($) |
Jun. 30, 2017 ($) |
Sep. 30, 2017 ($) |
||||||||||
| Gross profit (GAAP) |
77,405 | 64,611 | 58,470 | |||||||||
| Gross margin (GAAP) |
48.8 | % | 48.7 | % | 46.0 | % | ||||||
| Stock-based compensation expense (A) |
156 | 2 | 58 | |||||||||
| Gross profit (non-GAAP) |
77,561 | 64,613 | 58,528 | |||||||||
| Gross margin (non-GAAP) |
48.9 | % | 48.7 | % | 46.0 | % | ||||||
| Operating expenses (GAAP) |
38,886 | 34,340 | 36,893 | |||||||||
| Stock-based compensation expense (A) |
(6,320 | ) | (982 | ) | (3,263 | ) | ||||||
| Amortization of intangible assets |
(526 | ) | (526 | ) | (526 | ) | ||||||
| Litigation expense |
(1 | ) | — | — | ||||||||
| Operating expenses (non-GAAP) |
32,039 | 32,832 | 33,104 | |||||||||
| Operating profit (GAAP) |
38,519 | 30,271 | 21,577 | |||||||||
| Operating margin (GAAP) |
24.3 | % | 22.8 | % | 17.0 | % | ||||||
| Total adjustments to operating profit |
7,003 | 1,510 | 3,847 | |||||||||
| Operating profit (non-GAAP) |
45,522 | 31,781 | 25,424 | |||||||||
| Operating margin (non-GAAP) |
28.7 | % | 23.9 | % | 20.0 | % | ||||||
| Non-operating income (expense) (GAAP) |
194 | 886 | 1,726 | |||||||||
| Foreign exchange loss (gain), net |
375 | 65 | (701 | ) | ||||||||
| Non-operating income (expense) (non-GAAP) |
569 | 951 | 1,025 | |||||||||
| Net income (GAAP) |
32,722 | 24,033 | 17,594 | |||||||||
| Total pre-tax impact of non-GAAP adjustments |
7,378 | 1,575 | 3,146 | |||||||||
| Income tax impact of non-GAAP adjustments |
(1,768 | ) | (173 | ) | (393 | ) | ||||||
| Net income (non-GAAP) |
38,332 | 25,435 | 20,347 | |||||||||
| Earnings per diluted ADS (GAAP) |
$ | 0.92 | $ | 0.67 | $ | 0.49 | ||||||
| Earnings per diluted ADS (non-GAAP) |
$ | 1.07 | $ | 0.71 | $ | 0.57 | ||||||
| Shares used in computing earnings per diluted ADS (GAAP) |
35,539 | 35,801 | 35,828 | |||||||||
| Non-GAAP Adjustments |
244 | 51 | 129 | |||||||||
| Shares used in computing earnings per diluted ADS (non-GAAP) |
35,783 | 35,852 | 35,957 | |||||||||
| (A) Excludes stock-based compensation as follows: |
||||||||||||
| Cost of Sales |
156 | 2 | 58 | |||||||||
| Research & development |
4,009 | 315 | 1,960 | |||||||||
| Sales & marketing |
1,038 | 596 | 767 | |||||||||
| General & administrative |
1,273 | 71 | 536 | |||||||||
9
Silicon Motion Technology Corporation
Consolidated Statements of Income
(in thousands, except percentages, and per ADS data, unaudited)
| For the Nine Months Ended | ||||||||
| Sep. 30, 2016 ($) |
Sep. 30, 2017 ($) |
|||||||
| Net Sales |
411,948 | 387,239 | ||||||
| Cost of sales |
209,461 | 199,332 | ||||||
|
|
|
|
|
|||||
| Gross profit |
202,487 | 187,907 | ||||||
| Operating expenses |
||||||||
| Research & development |
66,367 | 74,107 | ||||||
| Sales & marketing |
20,114 | 18,504 | ||||||
| General & administrative |
12,024 | 11,887 | ||||||
| Amortization of intangibles assets |
1,577 | 1,577 | ||||||
|
|
|
|
|
|||||
| Operating income |
102,405 | 81,832 | ||||||
| Non-operating expense (income) |
||||||||
| Interest income, net |
1,407 | 2,710 | ||||||
| Foreign exchange gain (loss), net |
(803 | ) | 289 | |||||
| Others, net |
48 | 14 | ||||||
|
|
|
|
|
|||||
| Subtotal |
652 | 3,013 | ||||||
|
|
|
|
|
|||||
| Income before income tax |
103,057 | 84,845 | ||||||
| Income tax expense |
18,274 | 19,707 | ||||||
|
|
|
|
|
|||||
| Net income |
84,783 | 65,138 | ||||||
|
|
|
|
|
|||||
| Earnings per basic ADS |
$ | 2.41 | $ | 1.83 | ||||
|
|
|
|
|
|||||
| Earnings per diluted ADS |
$ | 2.39 | $ | 1.82 | ||||
|
|
|
|
|
|||||
| Margin Analysis: |
||||||||
| Gross margin |
49.2 | % | 48.5 | % | ||||
| Operating margin |
24.9 | % | 21.1 | % | ||||
| Net margin |
20.6 | % | 16.8 | % | ||||
| Additional Data: |
||||||||
| Weighted avg. ADS equivalents |
35,198 | 35,651 | ||||||
| Diluted ADS equivalents |
35,476 | 35,867 | ||||||
10
Silicon Motion Technology Corporation
Reconciliation of GAAP to Non-GAAP Operating Results
(in thousands, except percentages and per ADS data, unaudited)
| For the Nine Months Ended | ||||||||
| Sep. 30, 2016 ($) |
Sep. 30, 2017 ($) |
|||||||
| Gross profit (GAAP) |
202,487 | 187,907 | ||||||
| Gross margin (GAAP) |
49.2 | % | 48.5 | % | ||||
| Stock-based compensation expense(A) |
201 | 127 | ||||||
| Gross profit (non-GAAP) |
202,688 | 188,034 | ||||||
| Gross margin (non-GAAP) |
49.2 | % | 48.6 | % | ||||
| Operating expenses (GAAP) |
100,082 | 106,075 | ||||||
| Stock-based compensation expense (A) |
(8,736 | ) | (7,313 | ) | ||||
| Amortization of intangible assets |
(1,577 | ) | (1,577 | ) | ||||
| Litigation expense |
(51 | ) | — | |||||
| Operating expenses (non-GAAP) |
89,718 | 97,185 | ||||||
| Operating profit (GAAP) |
102,405 | 81,832 | ||||||
| Operating margin (GAAP) |
24.9 | % | 21.1 | % | ||||
| Total adjustments to operating profit |
10,565 | 9,017 | ||||||
| Operating profit (non-GAAP) |
112,970 | 90,849 | ||||||
| Operating margin (non-GAAP) |
27.4 | % | 23.5 | % | ||||
| Non-operating income (expense) (GAAP) |
652 | 3,013 | ||||||
| Foreign exchange loss (gain), net |
803 | (289 | ) | |||||
| Non-operating income (expense) (non-GAAP) |
1,455 | 2,724 | ||||||
| Net income (GAAP) |
84,783 | 65,138 | ||||||
| Total pre-tax impact of non-GAAP adjustments |
11,368 | 8,728 | ||||||
| Income tax impact of non-GAAP adjustments |
(2,810 | ) | (986 | ) | ||||
| Net income (non-GAAP) |
93,341 | 72,880 | ||||||
| Earnings per diluted ADS (GAAP) |
$ | 2.39 | $ | 1.82 | ||||
| Earnings per diluted ADS (non-GAAP) |
$ | 2.62 | $ | 2.03 | ||||
| Shares used in computing earnings per diluted ADS (GAAP) |
35,476 | 35,867 | ||||||
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| For the Nine Months Ended | ||||||||
| Sep. 30, 2016 ($) |
Sep. 30, 2017 ($) |
|||||||
| Non-GAAP Adjustments |
140 | 86 | ||||||
| Shares used in computing earnings per diluted ADS (non-GAAP) |
35,616 | 35,953 | ||||||
| (A) Excludes stock-based compensation as follows: |
||||||||
| Cost of Sales |
201 | 127 | ||||||
| Research & development |
5,453 | 4,125 | ||||||
| Sales & marketing |
1,646 | 1,972 | ||||||
| General & administrative |
1,637 | 1,216 | ||||||
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Silicon Motion Technology Corporation
Consolidated Balance Sheet
(In thousands, unaudited)
| Sep. 30, 2016 ($) |
Jun . 30, 2017 ($) |
Sep. 30, 2017 ($) |
||||||||||
| Cash and cash equivalents |
260,468 | 303,612 | 327,811 | |||||||||
| Short-term investments |
8,683 | 2,354 | 4,984 | |||||||||
| Accounts receivable (net) |
61,800 | 76,644 | 68,652 | |||||||||
| Inventories |
79,728 | 81,767 | 78,594 | |||||||||
| Refundable deposits – current |
44,289 | 44,119 | 19,542 | |||||||||
| Prepaid expenses and other current assets |
6,392 | 11,278 | 11,204 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total current assets |
461,360 | 519,774 | 510,787 | |||||||||
| Long-term investments |
133 | 120 | 120 | |||||||||
| Property and equipment (net) |
48,726 | 48,910 | 48,552 | |||||||||
| Goodwill and intangible assets (net) |
74,423 | 72,840 | 77,691 | |||||||||
| Other assets |
11,033 | 5,593 | 5,914 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total assets |
595,675 | 647,237 | 643,064 | |||||||||
|
|
|
|
|
|
|
|||||||
| Accounts payable |
38,207 | 32,949 | 36,518 | |||||||||
| Loans |
35,000 | 25,000 | — | |||||||||
| Income tax payable |
22,148 | 21,355 | 22,360 | |||||||||
| Accrued expenses and other current liabilities |
73,308 | 50,750 | 44,637 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total current liabilities |
168,663 | 130,054 | 103,515 | |||||||||
| Other liabilities |
16,766 | 21,354 | 22,313 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total liabilities |
185,429 | 151,408 | 125,828 | |||||||||
| Shareholders’ equity |
410,246 | 495,829 | 517,236 | |||||||||
|
|
|
|
|
|
|
|||||||
| Total liabilities & shareholders’ equity |
595,675 | 647,237 | 643,064 | |||||||||
|
|
|
|
|
|
|
|||||||
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About Silicon Motion:
We are the global leader in supplying NAND flash controllers for solid state storage devices and the merchant leader in supplying SSD controllers. We have the broadest portfolio of controller technologies and solutions and ship over 750 million NAND controllers annually, more than any other company in the world. Our controllers are widely used in embedded storage products such as SSDs and eMMCs which are found in smartphones, PCs and industrial and commercial applications. We also supply specialized high-performance hyperscale datacenter and industrial SSD solutions. Our customers include most of the NAND flash vendors, storage device module makers and leading OEMs. For further information on Silicon Motion, visit us at www.siliconmotion.com.
Forward-Looking Statements:
This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including without limitation, statements about Silicon Motion’s currently expected fourth quarter of 2017 and full year 2017 expectations of revenue, gross margin and operating expenses, all of which reflect management’s estimates based on information available at this time of this press release. While Silicon Motion believes these estimates to be meaningful, these amounts could differ materially from actual reported amounts for the fourth quarter of 2017 and full year 2017. Forward-looking statements also include, without limitation, statements regarding trends in the multimedia consumer electronics market and our future results of operations, financial condition and business prospects. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “continue,” or the negative of these terms or other comparable terminology. Although such statements are based on our own information and information from other sources we believe to be reliable, you should not place undue reliance on them. These statements involve risks and uncertainties, and actual market trends or our actual results of operations, financial condition or business prospects may differ materially from those expressed or implied in these forward looking statements for a variety of reasons. Potential risks and uncertainties include, but are not limited to the unpredictable volume and timing of customer orders, which are not fixed by contract but vary on a purchase order basis; the loss of one or more key customers or the significant reduction, postponement, rescheduling or cancellation of orders from these customers; general economic conditions or conditions in the semiconductor or consumer electronics markets; decreases in the overall average selling prices of our products; changes in the relative sales mix of our products; changes in our cost of finished goods; the payment, or non-payment, of cash dividends in the future at the discretion of our board of directors and any announced planned increases in such dividends; the effect, if any, on the price of our ADS as a result of the implementation of the announced share repurchase program; changes in our cost of finished goods; the availability, pricing, and timeliness of delivery of other components and raw materials used in our customers’
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products; our customers’ sales outlook, purchasing patterns, and inventory adjustments based on consumer demands and general economic conditions, its customers and consumers; any potential impairment recognized in our fourth quarter of 2017 relating to FCI; our ability to successfully develop, introduce, and sell new or enhanced products in a timely manner; and the timing of new product announcements or introductions by us or by our competitors. For additional discussion of these risks and uncertainties and other factors, please see the documents we file from time to time with the Securities and Exchange Commission, including our Annual Report on Form 20-F filed on April 28, 2017, as amended on May 2, 2017. We assume no obligation to update any forward-looking statements, which apply only as of the date of this press release.
| Investor Contact: | Investor Contact: | |
| Jason Tsai | Selina Hsieh | |
| Senior Director of IR and Strategy | Investor Relations | |
| E-mail: jtsai@siliconmotion.com | E-mail: ir@siliconmotion.com | |
| Media Contact: | ||
| Sara Hsu | ||
| Project Manager | ||
| E-mail: sara.hsu@siliconmotion.com | ||
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