13 April 2015

SemiLEDs' recovery driven by new customers and design wins

For fiscal second-quarter 2015 (to end-February 2015), LED chip and component maker SemiLEDs Corp of Hsinchu, Taiwan has reported revenue of $4.6m, continuing the rebound from the low of $2.3m in fiscal fourth-quarter 2014 and up 56% on $2.9m in fiscal Q1/2015, and up 9.5% on $4.2m a year ago. It also exceeds the guidance of $3.4-3.7m, since some of the product scheduled to be shipped in March was shipped earlier in February due to customer demand.

Sequential revenue growth is attributed to continued efforts to develop new customers and new design wins in target end-markets.

Revenue from LED chips fell by 26% sequentially (from 24% of total revenue to 11%), but revenue from LED components rose by 99% (from 55% of total revenue to 69%) and revenue from lighting products rose by 118% (from 13% of total revenue to 19%).

Gross margin has improved from negative 75% a year ago and negative 53% last quarter to negative 14%. Selling, general & administrative (SG&A) expenses have fallen further, from $2.26m a year ago and $2.15m last quarter to $1.88m. Research and development (R&D) expenses have been cut from $1.22m a year ago and $0.75m last quarter to $0.61m. Operating margin has hence improved from negative 159% a year ago and negative 152% last quarter to negative 62%. On a non-GAAP basis, net loss was $2.5m, cut from $3.9m last quarter and $5.9m a year ago.

"Our cost-reduction policy continued to show positive effects and resulted in a substantial decrease in cash used in operations [$1.4m, almost halved from $2.7m last quarter and a third of the $4.2m a year ago]," chairman, president & CEO Trung Doan. Capital expenditure has been cut from $0.93m a year ago and $0.6m last quarter to $0.42m. Hence free cash outflow has been cut further, from $5.1m a year ago and $3.3m last quarter to $1.8m. During the quarter, cash and cash equivalents fell from $8.7m to $6.7m.

"As expected, new design wins and improved operating efficiency have given us better-than-forecasted second quarter results," says Doan. "We are looking forward to new design wins and developing key customers to bring us closer to profitability," he adds.

For fiscal third-quarter 2015 (to end-May), SemiLEDs expects revenue of $3-4m. "Based on our growing pipeline of design wins in the LED component products, we believe that the second half of 2015 will show further growth," says Doan.

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