Silicon Motion Technology (SIMO) Gains on Quarterly Earnings Results
Shares of Silicon Motion Technology (SIMO) were trading up +2.35 or +10.26 percent to $25.25 per share in pre-market trading Tuesday morning, after the company announced second quarter earnings which beat analyst expectations. Silicon Motion Technology stock closed at $22.90 per share, up +0.32 or +1.42 percent in Monday's regular trading session.
This morning, Silicon Motion released second quarter earnings of $0.41 per diluted share, versus $0.27 in the same period one year ago and versus $5.4 million or $0.16 per share in the first quarter this year. Second quarter revenue came to $69.40 million, versus $52.8 million in the first quarter. Analysts expected second quarter earnings of $0.32 per share on revenue of $62.94 million.
Silicon Motion's President and Chief Executive Officer, Wallace Kou said in the company's press release that, "The second quarter was an outstanding quarter for the Company as all our new growth products contributed to strong 31% sequential growth. Our SSD plus embedded revenue grew over 55% and accounted for well over 50% of total revenue. Within our SSD plus embedded products, both our eMMC controllers and SATA 3 client SSD controllers grew strongly. Our eMMC controllers grew 65% as one of our Korean NAND flash partners increased its global eMMC market share more rapidly than anticipated and our other NAND flash partner continued ramping its new TLC eMMC. Our eMMC controllers are now used in the devices manufactured by all of the top ten non-iOS smartphone OEMs, two more than last quarter. Our SSD controller sales also grew stronger than expected as our module maker customers aggressively marketed SSDs with our controllers to consumers.
Kou also said that during the second quarter, "we began initial sales of our LTE-Advanced transceiver to our Korean handset partner and secured two additional design wins for mass production in the third quarter of this year.
In addition to stellar earnings, Silicon Motion also announced a quarterly cash dividend of $0.15 per ADS share, equivalent to $0.0375 per ordinary share. One ADS share is equal to four ordinary shares. The dividend will be payable on August 20th, 2014 to all shareholders of record on August 12th, 2014.
Guidance for the company's third quarter was also upwardly revised to increase +15 to +20 percent quarter on quarter, versus the analyst expectation of a +3 percent quarterly increase. Full year growth was forecast to be up +22 to +27 percent, versus an expected analyst consensus of a +16.7 percent increase.
Silicon Technology stock will open above its yearly high this morning and could test its all time high of $27.92 made in July of 2007. The stock has recovered significantly after trading under $5 per share during 2008 up until the beginning of 2011. With the company continuing to make progress with mobile phone manufacturers, analysts continue increasing their price targets for the stock.
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