MagnaChip Launches New MOSFET to Enhance Protection for Wireless Earphones While Recharging

SEOUL, South Korea and SAN JOSE, Calif.

 

MagnaChip Semiconductor Corporation (“MagnaChip” or the “Company”) (NYSE: MX), a designer and manufacturer of analog and mixed-signal semiconductor products, announced today the company is entering the wireless earphone market with the introduction of a new MOSFET for wireless earphones for preventing the battery from overcharging. This MOSFET is designed to control excessive current flowing into wireless earphones while recharging the battery in order to protect wireless earphones from being damaged.

Since 2010, MagnaChip has been providing the world’s highest volume of MOSFETs for smartphone battery charging protection. MagnaChip expects that the Company’s place as the global leading supplier of MOSFETs will be solidified by virtue of increased demand in the variety of electronic products including wireless earphones.

In particular, it is the industry’s expectation that the size of the wireless earphone market may jump from 120 million units in 2019 to 230 million units in 2020, with subsequent annual growth rate as high as 90 percent.

The new MOSFET is designed to prevent damage to the delicate circuitry of the wireless earphone charging case by blocking excessive voltage from flowing to the charger. It also allows for highly-stable charging environment by blocking electrostatic discharge as high as 2kV from penetrating into the earphone charger, which often occurs during recharging. In addition to implementing strategies to increase the market share of MOSFETs for wireless earphones, MagnaChip is poised to expand the application of MOSFETs into wearable products such as smartwatches and VR (Virtual Reality) headsets.

Mr. Y.J. Kim, CEO of MagnaChip, said: “The charging performance is one of the key elements of wireless earphones in determining their overall quality and competitiveness. Our new MOSFET will contribute greatly to the increase of charging stability.” Mr. Kim added: “Based on our research and development capabilities progressed over the last several years, MagnaChip sees this sector as an excellent opportunity to diversify our target markets and we will continue to offer top quality MOSFET products for diverse applications.”

About MagnaChip Semiconductor
MagnaChip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, industrial and automotive applications. The Company’s Standard Products Group and Foundry Services Group provide a broad range of standard products and manufacturing services to customers worldwide. MagnaChip, with about 40 years of operating history, owns a portfolio of approximately 3,000 registered patents and pending applications, and has extensive engineering, design and manufacturing process expertise. For more information, please visit www.magnachip.com.

CONTACTS:

United States (Investor Relations):
Bruce Entin
Entin Consulting
Tel. +1-408-625-1262
Investor.relations@magnachip.com

USA media / industry analysts:
Mike Newsom
LouVan Communications, Inc.
Tel. +1-617-803-5385
mike@louvanpr.com

Korea / Asia media:
Chankeun Park
Director of Public Relations
Tel. +82-2-6903-5223
chankeun.park@magnachip.com

MagnaChip Revenue of $200.0 Million At High-End of Updated Q4 2019 Guidance Range; OLED Revenue of $67.3 Million in Fourth Quarter Up Two-Fold Year-Over-Year


– Gross Margin of 26.6% in Q4 Slightly Above Mid-Point of Updated Guidance Range
– Cash of $151.7 Million, Up 15.5% Sequentially; $20.5 Million Net Operating Cash Flow
– Revenue of $792.2 Million for 2019 Up 5.5%; OLED, Power Revenue Set Annual Records

 

SEOUL, South Korea and SAN JOSE, Calif., Feb. 19, 2020 /PRNewswire/ — MagnaChip Semiconductor Corporation (NYSE: MX) today announced financial results for the fourth quarter of 2019 and full year.

Q4 2019 Highlights

Revenue of $200.0 million exceeded high-end of original guidance range of $181-191 million provided on October 23, 2019; met high-end of updated
guidance range of $198-200 million provided on January 13, 2020.
Q4 revenue up 11.5% Year-over-Year (YoY); down 12.9% Quarter over Quarter (QoQ) due primarily to normal seasonal softness; OLED revenue
significantly better-than-expected, Foundry revenue better-than-expected, and Power revenue softer-than-expected.
OLED DDIC revenue of $67.3 million sets record; up two-fold YoY and down 14.0% QoQ
Power standard products revenue of $37.8 million, down 18.1% YoY; down 22.4% QoQ
Foundry Services Group (FSG) revenue of $86.6 million, up 4.2% YoY; down 4.1% QoQ
Total gross profit margin of 26.6% exceeded original guidance range of 24-26%; exceeded the mid-point of updated guidance range of 26-27%,
driven primarily by higher-than-expected fab utilization, an improved OLED product mix and better manufacturing yields at an external foundry on
latest-generation OLED display drivers.
Balance sheet: Cash and cash equivalents totaled $151.7 million, up 15.5% sequentially from $131.3 million, and highest in six years; $20.5 million
net operating cash flow; third consecutive quarter of net positive operating cash flow.

2019 Summary

Revenue of $792.2 million, up 5.5% YoY from $750.9 million
Record OLED revenue of $267.1 million, up 42.1% from $188.0 million in 2018
Record Power revenue of $176.2 million, up 4.1% from $169.3 million in 2018
Foundry revenue of $307.1 million, down 5.6% from $325.3 million in 2018
Total gross profit margin of 22.8%, despite abnormally low gross margin in Q1 2019

CEO YJ Kim comments on Coronavirus and Q1 2020 financial guidance
On behalf of MagnaChip, let me extend our deepest thoughts and prayers to those coping with the impact of the COVID-19 coronavirus in China and elsewhere. From a business perspective, we are still assessing the potential impact since the coronavirus situation is still very dynamic. MagnaChip historically has experienced typical seasonal softness and a decline in revenue in its first quarter as compared to the prior fourth quarter, but we entered 2020 with a more optimistic view. Prior to the coronavirus outbreak, our preliminary internal forecast had anticipated Q1 2020 revenue would be slighter higher than the $200 million in revenue we reported in Q4 2019.

MagnaChip’s manufacturing supply chain resides largely outside China so there is negligible impact on our results. However, based on our preliminary assessments, public health measures taken in China to protect the population likely will affect customer demand in Q1. As a result, we’ve lowered our internal expectation and widened the typical guidance range we normally would provide for Q1 2020 to help account for lingering uncertainty around this public health crisis. While actual results may vary based upon events that are still unfolding, MagnaChip currently anticipates, based on best available current estimates, in Q1 2020:

Revenue to be in the range of $180 million to $195 million, down 6.2% at the mid-point of the projected range when compared with revenue of
$200.0 million in the fourth quarter of 2019, and up 19.1% year-over-year when compared to revenue of $157.4 million in the first quarter of 2019.
Gross profit margin to be in the range of 23% to 25%, when compared to 26.6% in the fourth quarter of 2019 and 14.4% in the first quarter of 2019.

CEO YJ Kim comments on business highlights
Revenue of $200.0 million was the highest level achieved in a fourth quarter since 2012, primarily due to significantly better-than-expected revenue for our OLED display drivers as well as better-than-expected revenue in our Foundry business. OLED revenue in the fourth quarter increased two-fold year-over-year, driven primarily by a sharp increase in demand for our latest generation 28-nanometer display drivers. We enter 2020 with an OLED driver lineup about twice as large as a year ago, and we’re positioned for continued long-term growth with OLED drivers that meet the dual technical requirements for low power and high-resolution displays in next-generation 5G-enabled smartphones and new foldables. Power revenue declined 18.1%, more than had been expected in Q4, due to pricing pressure and weakness in the industrial and television markets. However, Power revenue in 2019 showed growth for the third consecutive year, and revenue from premium Power products increased by more than 20% in 2019 over the prior year. Our Foundry revenue in the fourth quarter increased 4.2% year-over-year and was at the highest level for 8″ foundry revenue since our initial public offering in 2011.

Strategic Evaluation Process
We continue to make substantial progress in discussions with multiple interested parties toward a possible sale of the business as well as consideration of accretive business conversions and other options. We reiterate that our decisions regarding the outcome of the various options of the strategic evaluation process will be guided by what the Board and management consider to be the best available path to improve MagnaChip’s profitability and to maximize shareholder value.

Fourth Quarter Financial Review
Total Revenue
Total revenue in the fourth quarter was $200.0 million, up 11.5% as compared to reported revenue of $179.4 million from the fourth quarter of 2018, and down 12.9% from $229.7 million in the third quarter of 2019.

Segment Revenue
Foundry Services Group revenue in the fourth quarter was $86.6 million, up 4.2% from the fourth quarter of 2018, and down 4.1% sequentially. Standard Products Group revenue in the fourth quarter was $113.3 million, up 17.7% from the fourth quarter of 2018, and down 18.6% sequentially.

Total Gross Profit and Gross Profit Margin
Total gross profit in the fourth quarter of 2019 was $53.2 million or 26.6% as a percentage of revenue, as compared with a gross profit of $43.9 million or 24.5% as a percentage of revenue in the fourth quarter of 2018, and $60.9 million or 26.5% as a percentage of revenue in the third quarter of 2019.

Segment Gross Profit Margin
Foundry Services Group gross profit margin in the fourth quarter was 26.1% as compared with 23.2% in the fourth quarter of 2018 and 28.3% in the third quarter of 2019. The YoY in the Foundry Services Group’s gross profit margin was primarily due to an improved product mix. The Standard Products Group gross profit margin in the fourth quarter was 26.9% as compared with 25.6% in the fourth quarter of 2018 and 25.3% in the third quarter of 2019. The YoY and sequential improvement in the Standard Products Group’s gross profit margin was due primarily to an improved product mix, and stabilized wafer yields from external suppliers on OLED products that entered production in the third quarter of 2019.

Operating Income, Net Income, Adjusted Net Income, Adjusted EBITDA
Operating income was $10.0 million for the fourth quarter of 2019 as compared to operating income of $7.9 million for the fourth quarter of 2018 and $25.9 million in the third quarter of 2019.

Net income, on a GAAP basis, was $23.4 million or $0.68 per basic share and $0.54 per diluted share in the fourth quarter of 2019 as compared with net loss of $2.4 million or $0.07 per basic and diluted share in the fourth quarter of 2018 and net loss of $1.6 million or $0.05 per basic and diluted share in the third quarter of 2019.

Adjusted Net Income, a non-GAAP financial measure, totaled $13.2 million or $0.38 per basic share and $0.32 per diluted share in the fourth quarter of 2019 as compared to Adjusted Net Income of $3.5 million or $0.10 per basic and diluted share in the fourth quarter of 2018 and Adjusted Net Income of $20.9 million or $0.61 per basic share and $0.49 per diluted share in the third quarter of 2019.

Adjusted EBITDA, a non-GAAP financial measure, was $27.7 million or 13.8% of revenue in the fourth quarter of 2019 as compared to Adjusted EBITDA of $17.4 million or 9.7% of revenue in the fourth quarter of 2018 and Adjusted EBITDA of $35.5 million or 15.4% of revenue in the third quarter of 2019.

Management believes that non-GAAP financial measures, when viewed in conjunction with GAAP results, can provide a meaningful understanding of the factors and trends affecting MagnaChip’s business and operations and assist in evaluating our core operating performance. However, such non-GAAP financial measures have limitations and should not be considered as a substitute for net income or as a better indicator of our operating performance than measures that are presented in accordance with GAAP. A reconciliation of GAAP results to non-GAAP results is included in this press release.

Cash and cash equivalents totaled $151.7 million in the fourth quarter, up from $131.3 million in the third quarter of 2019.

Fourth Quarter 2019 and Recent Company Highlights
MagnaChip:

Announced that CEO YJ Kim was awarded the National Industrial Service Medal by the Korean President in acknowledgement of his efforts to attract investment and encourage job development in Korea. The medal was presented at the annual ‘Foreign Company Day’ ceremony hosted by the Korea Ministry of Industry, Trade and Energy, and the Korea Foreign Company Association (FORCA).
http://investors.magnachip.com/news-releases/news-release-details/magnachip-semiconductor-ceo-yj-kim-awarded-koreas-prestigious
Was nominated as a 2019 Finalist for the award of “Most Respected Emerging Public Semiconductor Company” by the Global Semiconductor Alliance.

2019 Global Semiconductor Alliance Award Nominees Announced

Fourth Quarter 2019 Earnings Conference Call
The earnings conference call will be webcast live today (February 19, 2020) at 5:00 p.m. ET, and also is available by dialing toll-free at 1-844-536-5472. International call-in participants can dial 1-614-999-9318. The conference ID number is 7994839. Participants are encouraged to initiate their calls at least 10 minutes in advance of the 5 p.m. ET start time to ensure a timely connection. The webcast and earnings release will be accessible at www.magnachip.com. A replay of the conference call will be available the same day and will run for 72 hours. The replay dial-in numbers are 1-404-537-3406 or toll-free at 1-855-859-2056. The access code is 7994839.

About MagnaChip Semiconductor Corporation
MagnaChip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, industrial and automotive applications. The Company’s Standard Products Group and Foundry Services Group provide a broad range of standard products and manufacturing services to customers worldwide. MagnaChip, with 41 years of operating history, owns a portfolio of approximately 2,950 registered patents and pending applications, and has extensive engineering, design and manufacturing process expertise. For more information, please visit www.magnachip.com. Information on or accessible through, MagnaChip’s website is not a part of, and is not incorporated into, this release.

Safe Harbor for Forward-Looking Statements
Information in this release regarding MagnaChip’s forecasts, business outlook, expectations and beliefs are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. These statements include statements about our future operating and financial performance, including but not limited to first quarter 2020 revenue and gross profit margin expectations. All forward-looking statements included in this release are based upon information available to MagnaChip as of the date of this release, which may change, and we assume no obligation to update any such forward-looking statements. These statements are not guarantees of future performance and actual results could differ materially from our current expectations. Factors that could cause or contribute to such differences include general economic conditions, the impact of competitive products and pricing, timely design acceptance by our customers, timely introduction of new products and technologies, ability to ramp new products into volume production, industry wide shifts in supply and demand for semiconductor products, industry and/or company overcapacity, effective and cost efficient utilization of manufacturing capacity, financial stability in foreign markets and the impact of foreign exchange rates, unanticipated costs and expenses or the inability to identify expenses which can be eliminated, compliance with U.S. and international trade and export laws and regulations by us and our distributors, the risk that the strategic evaluation and the initiatives related thereto described above are not successful, public health issues, including the outbreak of COVID-19, coronavirus, and other business interruptions that could disrupt supply or delivery of, or demand for, MagnaChip’s products, and other risks detailed from time to time in MagnaChip’s filings with the SEC, including our Form 10-K filed on February 22, 2019 and subsequent registration statements, amendments or other reports that we may file from time to time with the SEC and/or make available on our website. MagnaChip assumes no obligation and does not intend to update the forward-looking statements provided, whether as a result of new information, future events or otherwise.

CONTACTS:

In the United States:
Bruce Entin
Investor Relations
Tel. +1-408-625-1262
Investor.relations@magnachip.com

In Korea:
Chankeun Park
Director, Public Relations
Tel. +82-2-6903-5223
chankeun.park@magnachip.com

MagnaChip Offers 0.13 micron BCD Process with Enhanced Performance Suitable for Automotive Power Semiconductors

 

SEOUL, South Korea and SAN JOSE, Calif., Feb. 10, 2020 /PRNewswire/ — MagnaChip Semiconductor Corporation (“MagnaChip”) (NYSE: MX), a Korea-based designer and manufacturer of analog and mixed-signal semiconductor products, announced today that it now offers a 0.13 micron BCD process with improved performance to help automotive power semiconductor designers build more competitive products.

BCD (Bipolar-CMOS-DMOS) is a process technology that combines three different process technologies onto a single chip: Bipolar for analog signal control and CMOS (Complementary Metal Oxide Semiconductor) and DMOS (Double Diffused Metal Oxide Semiconductor) for digital signal control and high-power handling, used primarily for power semiconductors. In particular, the process announced today has been certified as Grade-1 under AEC-Q100, a reliability standard for automotive electronics and, therefore, is suitable for diverse automotive power semiconductors — including motor driver ICs, BMSs (Battery Management Systems) and DC-DC ICs. With the introduction of this process, the company plans to launch targeted marketing activities to attract more automotive semiconductor designers as customers.

Driven by the adoption of electric vehicles, the automotive semiconductor sector – including power products – is projected to see considerable growth over the next five years. According to IHS Markit technology research, now a part of Informa Tech, the automotive semiconductor market is forecasted to grow from $42 billion in 2019 to approximately $60 billion in 2023.*

The MTP (Multi-Time Programming) IP applied to this newly enhanced 0.13 micron BCD process technology enables a chip to be reprogrammed at least 1000 times, a desirable feature for power semiconductors that require repeatable memory programming, such as motor driver ICs, power management ICs and level shifter ICs. Also, unlike the previous 0.13 micron BCD process technology, which requires additional photo layers to realize MTP IPs, this new 0.13 micron BCD process does not require additional photo layers as a result of IP design optimization. By virtue of no additional layers, MagnaChip’s new 0.13 micron BCD process could allow its customers to reduce cost and shorten the “time-to-market.”

YJ Kim, Chief Executive Officer of MagnaChip, commented: “Along with the rapid growth of the automotive power semiconductor market, demand is rising for foundry technologies with the highest possible reliability and cost competitiveness. Thanks to our BCD know-how and manufacturing expertise, I believe MagnaChip is more than capable to be the leading service provider in the growing automotive power semiconductor market.”

*Source – IHS Markit technology research, now part of Informa Tech, Pure Play Foundry Market Tracker, 2019. Results are not an endorsement of MagnaChip Semiconductor. Any reliance on these results is at the third-party’s own risk.

About MagnaChip Semiconductor
MagnaChip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, industrial and automotive applications. The Company’s Standard Products Group and Foundry Services Group provide a broad range of standard products and manufacturing services to customers worldwide. MagnaChip, with about 40 years of operating history, owns a portfolio of approximately 3,000 registered patents and pending applications, and has extensive engineering, design and manufacturing process expertise. For more information, please visit www.magnachip.com.

CONTACTS:

United States (Investor Relations):
Bruce Entin
Entin Consulting
Tel. +1-408-625-1262
Investor.relations@magnachip.com

USA media / industry analysts:
Mike Newsom
LouVan Communications, Inc.
Tel. +1-617-803-5385
mike@louvanpr.com

Korea / Asia media:
Chankeun Park
Director of Public Relations
Tel. +82-2-6903-5223
chankeun.park@magnachip.com

Magnachip Schedules Fourth Quarter 2019 Earnings Release and Conference Call for February 19

 

SEOUL, South Korea and SAN JOSE, Calif., Feb. 3, 2020 /PRNewswire/ — MagnaChip Semiconductor Corporation (“MagnaChip”) (NYSE: MX) announced today it will host a conference call on Wednesday, February 19, 2020 at 5 p.m. ET to discuss the Company’s financial results for the fourth quarter of 2019. Participating in the call will be YJ Kim, MagnaChip’s CEO and Jonathan Kim, Executive Vice President and CFO. The earnings press release will be issued after the market closes that day.

The conference call will be webcast live and also is available by dialing toll-free at 1-844-536-5472. International call-in participants can dial 1-614-999-9318. The conference ID number is 7994839 Participants are encouraged to initiate their calls at least 10 minutes in advance of the 5 p.m. ET start time to ensure a timely connection. The webcast and earnings release will be accessible at www.magnachip.com.

A replay of the conference call will be available the same day and will run for 72 hours. The replay dial-in numbers are 1-404-537-3406 or toll-free at 1-855-859-2056. The access code is 7994839.

About MagnaChip Semiconductor
MagnaChip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, industrial and automotive applications. The Company’s Standard Products Group and Foundry Services Groups provide a broad range of standard products and manufacturing services to customers worldwide. MagnaChip, with about 40 years of operating history, owns a portfolio of approximately 2,900 registered patents and pending applications, and has extensive engineering, design and manufacturing process expertise. For more information, please visit www.magnachip.com. Information on or accessible through, MagnaChip’s website is not a part of, and is not incorporated into, this release.

CONTACTS:

In the United States:
Bruce Entin
Investor Relations
Tel. +1.408.625.1262
Investor.relations@magnachip.com

In Korea:
Chankeun Park
Director, Public Relations
Tel. +82.2.6903.3195
chankeun.park@magnachip.com