Silicon Motion: Fiscal 2Q22 Financial Results

Highlights
• Sales grew 4% Q/Q and 14% Y/Y
• SSD controller sales declined 0% to 5% both Q/Q and Y/Y
• eMMC+UFS controller sales increased 5% to 10% Q/Q and 55% to 60% Y/Y
• SSD solutions sales increased 25% to 30% Q/Q and 30% to 35% Y/Y
• On May 5, announced pending sale to MaxLinear

Silicon Motion Technology Corporation announced its financial results for the quarter ended June 30, 2022.

For 2FQ22, net sales increased sequentially to $252.4 million from $242.0 million in 1FQ22. Net income (GAAP) declined to $51.6 million or $1.55 per diluted ADS (GAAP) from net income (GAAP) of $54.5 million or $1.60 per diluted ADS (GAAP) in the first quarter of 2022.

For 2FQ22, net income (non-GAAP) increased to $62.8 million or $1.88 per diluted ADS (non-GAAP) from net income (non-GAAP) of $58.9 million or $1.72 per diluted ADS (non-GAAP) in 1FQ22.

2FQ22 Review
“In the second quarter, our revenue continued to grow despite market conditions affected by Covid-19 lockdowns in China, Russia’s invasion of the Ukraine and a slowing global economy,” said Wallace Kou, president and CEO. “Growth of our SSD controller sales to customers building PCIe Gen 4 SSDs for PC OEMs remained very strong while sales to channel markets softened. Our eMMC+UFS controller sales to both smartphone and non-smartphone end-markets also grew.”

During 2FQ22, the company had $4.9 million of capital expenditures, including $2.9 million for the routine purchase of testing equipment, software, design tools and other items, and $2.0 million for building construction in Hsinchu, Taiwan.

Returning Value to Shareholders
On October 25, 2021, the board of directors declared a $2.00 per ADS annual dividend to be paid in quarterly installments of $0.50 per ADS. On May 26, 2022, the firm paid $16.5 million to shareholders as the third installment of the annual dividend.

On December 7, 2021, it announced that the board had authorized a new program for the company to repurchase up to $200 million of its ADSs over a 6-month period. During 2FQ22 prior to discontinuation of share repurchases with the announcement of firm’s pending transaction with MaxLinear, Inc., Silicon Motion repurchased $28.7 million of its ADSs at an average price of $75.58.