Pixelworks Reports Fourth Quarter and Fiscal Year 2018 Financial Results
Fourth quarter revenue increased 11% year-over-year with strong growth in new markets
SAN JOSE, Calif., Feb. 7, 2019 - Pixelworks, Inc. (NASDAQ: PXLW), a leading provider of power efficient visual processing solutions, today announced financial results for the fourth quarter and fiscal year ended December 31, 2018.
Fourth Quarter and Recent Highlights
Mobile revenue increased 78% year-over-year, reflecting volume production in support of a growing number of smartphone design wins
Video Delivery revenue increased 31% year-over-year, driven by ramping shipments of XCode transcoding chips to leading consumer electronics OEMs in Japan
GAAP gross profit margin increased 340 basis points year-over-year to 53.1%; non-GAAP gross profit margin was 55.1%
Nokia 7.1 and Black Shark Helo smartphones, featuring Iris visual processor, recognized for superior display performance
Monetized non-strategic patents for an after-tax gain of $3.9 million, net, to be recognized in first quarter of 2019
Entered into an agreement with HMD Global to provide visual processing solutions for next-generation Nokia smartphones
Full Year 2018 Business Highlights
Secured five smartphone wins across four OEMs for 3rd and 4th generation Iris visual processors
Launched 4th generation Iris mobile visual processor, and taped-out 5th generation Iris
Successfully integrated previously acquired Video Delivery business which became accretive to quarterly operating results
Completed multi-year SoC co-development project with large Projector customer
President and CEO of Pixelworks, Todd DeBonis, commented, “I’m pleased with our team’s execution in 2018, as we demonstrated substantial progress on both operational improvements and our growth objectives. In addition to the successful integration of ViXS Systems, we ramped a meaningful number of programs at new and existing customers across our targeted end markets. Notably, we maintained our investments in research and development in support of future growth, while also generating positive adjusted EBITDA and cash flow from operations for the year. In late December, we entered into an agreement to monetize non-strategic patents acquired as part of ViXS, which will result in recognizing a net gain of $3.9 million for the transaction in the first quarter of 2019 - further underscoring the realized value from this highly-accretive transaction for Pixelworks.
“2018 was also a transformative year in our Mobile business with announced wins on five smartphones, two of which were launched in the fourth quarter. Awareness and interest in our Iris family of mobile visual processors continue to build, and we exited the year with the strongest pipeline of active engagements to-date. Further highlighting our recent momentum, most recently we announced an agreement with HMD Global to incorporate Pixelworks’ Iris solution into a broad range of next-generation Nokia smartphones.
“In our Video Delivery business, we continue to see strong demand from our lead Japanese consumer electronics customers for our XCode family of transcoding solutions for ADSB-compatible 4K set-top-boxes and advanced PVRs. Initial uptake for these devices has been strong, and we expect healthy follow-on orders as OEM customers replenish the sales channel in order to meet future consumer demand in Japan.”
DeBonis, concluded, “Looking to 2019, we are focused on realizing the next leg of growth and targeting expanded opportunities across flagship and mid-tier mobile devices as well as next-generation consumer platforms for high-quality video streaming and delivery. As we ramp our growing pipeline of customer engagements and additional production orders, we expect to drive continued year-over-year growth in both our Mobile and Video Delivery end markets.”
The following information was filed by Pixelworks, Inc (PXLW) on Thursday, February 7, 2019 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.