SUNNYVALE, Calif. -- July 24, 2008 -- Silicon Image, Inc. (Nasdaq: SIMG), a leader in semiconductors and intellectual property for the secure storage, distribution and presentation of high-definition content, today reported financial results for its second quarter ended June 30, 2008.
Revenue for the second quarter of 2008 was $70.1 million, compared to $67.1 million for the first quarter of 2008 and $79.8 million for the second quarter of 2007.
GAAP net loss for the second quarter of 2008 was $0.5 million, or $0.01 per diluted share, compared to a GAAP net loss of $0.6 million, or $0.01 per diluted share, for the first quarter of 2008 and GAAP net income of $4.4 million, or $0.05 per diluted share, for the second quarter of 2007.
Non-GAAP net income for the second quarter of 2008 was $5.0 million, or $0.07 per diluted share, compared to $3.4 million, or $0.04 per diluted share, for the first quarter of 2008 and $8.5 million, or $0.10 per diluted share, for the second quarter of 2007. Non-GAAP net income excludes stock-based compensation expense and amortization of intangible assets.
A reconciliation of GAAP and non-GAAP items is provided in a table immediately following the Condensed Consolidated Statements of Operations.
Our financial results for the second quarter marked continued progress toward our targeted financial goals for 2008, said Steve Tirado, Silicon Image's president and chief executive officer. We are particularly pleased with another strong gross margin performance this quarter at 58 percent of revenue. Our focus throughout 2008 remains on delivering financial performance in line with our stated goals and bringing new products and technologies to market that will position Silicon Image for growth over the next several years.
Second Quarter Highlights
- InstaPort™ technology introduction enabling a switching times of less than a second between HDMI devices connected to a DTV, compared to the traditional switching times of 4-7 seconds. Video and audio sync times when changing from a set top box to a DVD player or any other device no longer lags to the point of consumer dissatisfaction.
- New DTV Input Processors (SiI9251 and SiI9261) supporting 4 high performance 36 bit component analog and 4 high performance HDMI 1.3 ports. Key technologies include Chromaviv™ color calibration, deep color, x.v color support, MHLTM technology and InstaPort high speed port switching.
- New Port Processors (SiI9285 and SiI9287) incorporating MHL technology for low pin count multi-function mobile device connectivity and InstaPort high speed port switching.
- New 12 megapixel camera processor IP core offering advanced camera functionality only found in digital still cameras to mobile phones, portable media players and other mobile devices.
- SteelVine™ Storage Processors support new Intel chipsets with its Advanced Host Controller Interface (AHCI) version 1.2 Serial ATA driver. Removes need for additional discrete port multiplier aware SATA controller.
- ASUSTeK Computer introduces seven new ASUS P5Q channel motherboards incorporating Silicon Image's SteelVine SiI5723 storage processor and the new ASUS Drive Xpert™ management utility software jointly developed by Silicon Image and ASUSTeK.
- Samsung Electronics and Simplay Labs™ launch the Simplay HD Self-Testing Pilot Program. The program will include on-site Simplay testing equipment installation, technician training and certification, quality control, collaborative test specification reviews and integration with product development and supply chain processes.
- Mobile Handset Industry Leaders forms a working group to drive new memory interface standard - Serial Port Memory Technology (SPMT™), the first-of-its-kind memory standard for dynamic random access memory (DRAM). ARM, Hynix Semiconductor Inc, LG Electronics, Samsung Electronics, Silicon Image, Sony Ericsson Mobile Communications AB and ST Microelectronics constitute the working group. SPMT provides a low power high performance solution that can extend battery life, reduce pin count 50% or more over DDR interfaces and offers single or multiple ported capability in a single SPMT memory chip.
- Silicon Image appoints Rashid Osmani to lead its global engineering organization. Osmani brings over 25 years of management and product development experience at leading technology companies.
- HDMI LLC appoints Steve Venuti as its new president.
The following is Silicon Image's current financial outlook for the third quarter of 2008:
- Revenue: $75 million - $77 million
- Gross margin: 56% - 57%
- GAAP operating expenses: $43 million - $44 million
- Non-GAAP operating expenses: $33 million - $34 million
- Interest Income: $0.9 million - $1.0 million
- Effective tax rate: 30% - 35%
- Diluted shares outstanding: approximately 75 million
For the full year of 2008, Silicon Image expects
- Revenue: $284 million - $289 million
- Gross margin: 57% - 58%
- GAAP operating expenses: $171 million - $173 million
- Non-GAAP operating expenses: $140 million - $142 million
- Effective tax rate: 30% - 35%
- Diluted shares outstanding: approximately 75 million on December 31, 2008
Use of Non-GAAP Financial Information
Silicon Image presents and discusses gross margin, operating expenses, net income and basic and diluted net income (loss) per share in accordance with Generally Accepted Accounting Principles (GAAP) and on a non-GAAP basis for informational purposes only. Silicon Image believes that non-GAAP reporting, giving effect to the adjustments shown in the attached reconciliation, provides meaningful information and therefore uses non-GAAP reporting to supplement its GAAP reporting and internally in evaluating operations, managing and monitoring performance, and determining bonus compensation. Further, Silicon Image uses non-GAAP information as certain non-cash charges such as amortization of intangibles and stock based compensation do not reflect the cash operating results of the business. Silicon Image has chosen to provide this supplemental information to investors, analysts and other interested parties to enable them to perform additional analyses of its operating results and to illustrate the results of operations giving effect to such non-GAAP adjustments. The non-GAAP financial information presented herein should be considered supplemental to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP.
Click here to read financial tables
The company will host an investor conference call today to discuss its second quarter results at 2:00 p.m. Pacific Time and will web cast that event. To access the conference call, dial 719-325-4770 and enter pass code 1154504. The webcast will be accessible on Silicon Image's investor relations website at http://www.SiliconImage.com. A replay of the conference call will be available within two hours of the conclusion of the conference call though August 7, 2008. To access the replay, please dial 719-457-0820 and enter pass code 1154504.
About Silicon Image, Inc.
Silicon Image, Inc. is a global leader in driving the architecture and semiconductor implementation for the secure storage, distribution and presentation of high-definition content in the consumer electronics, personal computing, and mobile device markets. With a rich history of technology innovation that includes creating industry standards such as SATA, DVI and HDMI, Silicon Image partners with the worldÕs leading entertainment creators and electronics manufacturers to deliver digital HD content to consumers anytime, anywhere, on any device. Silicon Image is also a leading provider of semiconductor intellectual property solutions for high-definition multimedia and data storage applications. Additionally, Simplay Labs, LLC, a wholly-owned subsidiary of Silicon Image, offers robust testing tools, technologies, support services, consulting and product certification to electronics manufacturers to maximize performance, interoperability and ensure the highest-quality HD experience to consumers. With engineering, sales and customer support facilities located throughout North America, Asia and Europe, Silicon Image (NASDAQ: SIMG) is globally headquartered in Sunnyvale, California. For more information, please visit www.SiliconImage.com.