SEOUL, South KoreaFeb. 7, 2024 /PRNewswire/ — Magnachip Semiconductor Corporation (“Magnachip”) (NYSE: MX) announced today that it will report its financial results for the fourth quarter ended December 31, 2023, on Wednesday, February 28, 2024, after the market closes. The Company will host a corresponding conference call at 2:00 p.m. PT / 5:00 p.m. ET to discuss its financial results.

In advance of the conference call, all participants must use the following link to complete the online registration process. Upon registering, each participant will receive access details for this event, including the dial-in numbers, a PIN number, and an e-mail with detailed instructions to join the conference call.

Online registration: https://register.vevent.com/register/BI736feb7bc081454c8d811cbbeb6b92dc

A live and archived webcast of the conference call and a copy of the earnings release will be accessible from the ‘Investors’ section of the company’s website at https://www.magnachip.com/cn.

 

About Magnachip Semiconductor Corporation

Magnachip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, computing, industrial and automotive applications. The Company provides a broad range of standard products to customers worldwide. Magnachip, with more than 40 years of operating history, owns a portfolio of approximately 1,100 registered patents and pending applications, and has extensive engineering, design and manufacturing process expertise. For more information, please visit https://www.magnachip.com/cn. Information on or accessible through Magnachip’s website is not a part of, and is not incorporated into, this release.

 

CONTACTS:

Steven Pelayo
The Blueshirt Group
Tel. +1 (360) 808-5154
steven@blueshirtgroup.co

 

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SOURCE Magnachip Semiconductor Corporation

SEOUL, South KoreaJan. 3, 2024 /PRNewswire/ — Magnachip Semiconductor Corporation (“Magnachip”) (NYSE: MX) today announced management’s participation in the 26th Annual Needham Growth Conference at the Lotte New York Palace Hotel in New York City on Wednesday, January 17th, and Thursday, January 18th.

Mr. YJ Kim, Magnachip’s Chief Executive Officer, and Ms. Shinyoung Park, Magnachip’s Chief Financial Officer, will be available for one-on-one meetings with institutional investors during the conference. For more information about the conference or to request a one-on-one meeting, please contact a Needham sales representative.

 

About Magnachip Semiconductor Corporation

Magnachip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, computing, industrial and automotive applications. The Company provides a broad range of standard products to customers worldwide. Magnachip, with more than 40 years of operating history, owns a portfolio of approximately 1,100 registered patents and pending applications, and has extensive engineering, design and manufacturing process expertise. For more information, please visit www.magnachip.com/cn. Information on or accessible through Magnachip’s website is not a part of, and is not incorporated into, this release.

 

CONTACT:

Yujia Zhai
The Blueshirt Group
Tel. (860) 214-0809
Yujia@blueshirtgroup.com

 

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SOURCE Magnachip Semiconductor Corporatio

Magnachip Reports Results for Third Quarter 2023

  • Revenue of $61.2 million was in-line with guidance.
  • Gross profit margin of 23.6% increased 140 basis points from Q2, mainly driven by higher fab utilization.
  • GAAP diluted loss per share was $0.13.
  • Non-GAAP diluted loss per share was $0.04.
  • Completed $5.4 million of stock buybacks during Q3.
  • Ended Q3 with a solid balance sheet with $166.6 million cash and no debt.
  • The internal separation of our Display and Power businesses is expected to be completed and be effective on January 1st, 2024.

 

SEOUL, South KoreaNov. 2, 2023 /PRNewswire/ — Magnachip Semiconductor Corporation (NYSE: MX) (“Magnachip” or the “Company”) today announced financial results for the third quarter 2023.YJ Kim, Magnachip’s Chief Executive Officer commented, “Our Q3 results were in-line with our guidance. In our Display business, we have completed the qualification of two DDI chips at our new tier 1 panel maker and are going through the qualification process with two smartphone makers. We are now working on additional Driver ICs that cover broader segments of the smartphone market to include mass market smartphones in addition to the premium models. Despite near-term market challenges, our outlook for long-term growth remains positive. Our confidence is driven by our strong belief that our display products offer distinct competitive advantages that position us well for success in the rapidly growing OLED market in Asia.”

YJ continued, “In our Power business, our product portfolio is getting stronger as we continue to focus on rolling out next-generation power products to maintain our momentum of design-in/wins. Looking ahead, amid heightened global geopolitical and macroeconomic uncertainty, we expect demand to remain soft, driven by normal Q4 seasonality and inventory correction in industrial end markets.”

 

Q3 2023 Financial Highlights
In thousands of U.S. dollars, except share data
GAAP
Q3 2023 Q2 2023 Q/Q change Q3 2022 Y/Y change
Revenues
Standard Products Business
   Display Solutions 6,404 9,657 down 33.7 % 6,355 up 0.8 %
   Power Solutions 45,215 41,718 up 8.4 % 56,416 down 19.9 %
Transitional Fab 3 foundry services(1) 9,626 9,604 up 0.2 % 8,428 up 14.2 %
Gross Profit Margin 23.6 % 22.2 % up 1.4 %pts 24.2 % down 0.6 %pts
Operating Loss (9,235) (10,656) up n/a (10,008) up n/a
Net Loss (5,165) (3,947) down n/a (17,195) up n/a
Basic Loss per Common Share (0.13) (0.09) down n/a (0.38) up n/a
Diluted Loss per Common Share (0.13) (0.09) down n/a (0.38) up n/a
In thousands of U.S. dollars, except share data
Non-GAAP(2)
Q3 2023 Q2 2023 Q/Q change Q3 2022 Y/Y change
Adjusted Operating Loss (7,064) (7,762) up n/a (6,646) down n/a
Adjusted EBITDA (2,735) (3,594) up n/a (2,995) up n/a
Adjusted Net Income (Loss) (1,591) (2,472) up n/a 1,097 down n/a
Adjusted Earnings (Loss) per Common Share—Diluted (0.04) (0.06) up n/a 0.02 down n/a
___________
(1) Following the consummation of the sale of the Foundry Services Group business and Fab 4 in Q3 2020, we provided transitional foundry services to the buyer for foundry products manufactured in our fabrication facility located in Gumi, Korea, known as “Fab 3” (“Transitional Fab 3 Foundry Services”). The contractual obligation to provide the Transitional Fab 3 Foundry Services ended August 31, 2023, and we are planning to wind down these foundry services and convert portions of the idle capacity to Power Solutions standard products beginning around the second half of 2024. Because these foundry services during the wind-down period are still provided to the same buyer by us using our Fab 3 based on mutually agreed terms and conditions, we will continue to report our revenue from providing these foundry services and related cost of sales within the Transitional Fab 3 Foundry Services line in our consolidated statement of operations until such wind down is completed. Management believes that disclosing revenue of Transitional Fab 3 Foundry Services separately from the standard products business allows investors to better understand the results of our core standard products display solutions and power solutions businesses.
(2) 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 our 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 (loss) 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.

 

Q4 2023 Financial Guidance
Amid heightened global geopolitical and macroeconomic uncertainty, we expect Power demand to soften driven by normal Q4 seasonality and inventory correction in industrial end markets.

While actual results may vary, Magnachip currently expects the following for Q4 2023:

  • Revenue to be in the range of $50 million to $55 million, including approximately $8 million of Transitional Fab 3 Foundry Services.
  • Gross profit margin to be in the range of 22.5% to 24.5%.

 

Q3 2023 Earnings Conference Call
Magnachip will host a corresponding conference call at 2:00 p.m. PT / 5:00 p.m. ET on Thursday, November 2, 2023, to discuss its financial results. In advance of the conference call, all participants must use the following link to complete the online registration process. Upon registering, each participant will receive access details for this event including the dial-in numbers, a PIN number, and an e-mail with detailed instructions to join the conference call. A live and archived webcast of the conference call and a copy of earnings release will be accessible from the ‘Investors’ section of the Company’s website at www.magnachip.com/cn.

 

Online registration: https://register.vevent.com/register/BI9578e24ef24a498a8d8ee6536b08edc6

 

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 expectations about estimated historical or future operating results and financial performance, outlook and business plans, including fourth quarter 2023 revenue and gross profit margin expectations, and the impact of market conditions associated with inflation and higher interest rates, remaining effects from the COVID-19 pandemic, geopolitical conflicts between Russia- Ukraine and between Israel-Hamas, escalated trade tensions between the U.S. and China and continuing supply constraints on Magnachip’s fourth quarter 2023 and future operating results. 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, among others: the impact of changes in macroeconomic conditions, including those caused by or related to inflation, potential recessions or other deteriorations, economic instability or civil unrest; remaining effects from the COVID-19 pandemic, the geopolitical conflicts between Russia-Ukraine and between Israel-Hamas, and escalated trade tensions between the U.S. and China; manufacturing capacity constraints or supply chain disruptions that may impact our ability to deliver our products or affect the price of components, which may lead to an increase in our costs and impact demand for our products from customers who are similarly affected by such capacity constraints or disruptions; the impact of competitive products and pricing; timely acceptance of our designs by customers; timely introduction of new products and technologies; our ability to ramp new products into volume production; industry-wide shifts in supply and demand for semiconductor products; overcapacity within the industry or at Magnachip; 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 that can be eliminated; compliance with U.S. and international trade and export laws and regulations by us, our customers and our distributors; change to or ratification of local or international laws and regulations, including those related to environment, health and safety; public health issues, including the remaining effects of the COVID-19 pandemic; 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 U.S. Securities and Exchange Commission (the “SEC”), including our Form 10-K filed on February 22, 2023, 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.

 

About Magnachip Semiconductor
Magnachip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, computing, industrial and automotive applications. The Company provides a broad range of standard products to customers worldwide. Magnachip, with more than 40 years of operating history, owns a portfolio of approximately 1,100 registered patents and pending applications, and has extensive engineering, design, and manufacturing process expertise. For more information, please visit www.magnachip.com/cn. Information on or accessible through Magnachip’s website is not a part of, and is not incorporated into, this release.

 

CONTACT:
Yujia Zhai
The Blueshirt Group
Tel. (860) 214-0809
Yujia@blueshirtgroup.com

 

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands of U.S. dollars, except share data)

(Unaudited)

Three Months Ended Nine Months Ended
September 30,
2023
June 30,
2023
September 30,
2022
September 30,
2023
September 30,
2022
Revenues:
Net sales – standard products business $         51,619 $         51,375 $         62,771 $       154,508 $       248,069
Net sales – transitional Fab 3 foundry services 9,626 9,604 8,428 24,721 28,599
Total revenues 61,245 60,979 71,199 179,229 276,668
Cost of sales:
Cost of sales – standard products business 36,829 37,867 45,497 112,008 165,197
Cost of sales – transitional Fab 3 foundry services 9,935 9,574 8,477 27,108 26,305
Total cost of sales 46,764 47,441 53,974 139,116 191,502
Gross profit 14,481 13,538 17,225 40,113 85,166
Gross profit as a percentage of standard products business net sales 28.7 % 26.3 % 27.5 % 27.5 % 33.4 %
Gross profit as a percentage of total revenues 23.6 % 22.2 % 24.2 % 22.4 % 30.8 %
Operating expenses:
Selling, general and administrative expenses 12,089 12,137 11,411 36,391 38,310
Research and development expenses 11,627 11,255 13,321 36,180 38,685
Early termination and other charges, net 802 2,501 9,251 3,298
Total operating expenses 23,716 24,194 27,233 81,822 80,293
Operating income (loss) (9,235) (10,656) (10,008) (41,709) 4,873
           Interest income 2,382 2,692 1,784 7,916 3,560
Interest expense (189) (200) (278) (645) (888)
Foreign currency gain (loss), net (2,583) 1,237 (12,809) (4,776) (20,511)
Other income, net 87 3 174 55 603
Loss before income tax expense (9,538) (6,924) (21,137) (39,159) (12,363)
Income tax benefit (4,373) (2,977) (3,942) (8,577) (1,356)
Net loss $           (5,165) $           (3,947) $         (17,195) $       (30,582) $         (11,007)
Basic loss per common share— $            (0.13) $            (0.09) $             (0.38) $           (0.73) $             (0.24)
Diluted loss per common share— $            (0.13) $            (0.09) $             (0.38) $           (0.73) $             (0.24)
Weighted average number of shares—
Basic 40,145,290 41,741,310 44,865,266 41,747,255 45,119,214
Diluted 40,145,290 41,741,310 44,865,266 41,747,255 45,119,214

 

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands of U.S. dollars, except share data)

(Unaudited)

 September 30,

      2023

    December 31,

      2022

Assets
Current assets
Cash and cash equivalents $     166,644 $     225,477
Accounts receivable, net 41,119 35,380
Inventories, net 30,836 39,883
Other receivables 2,799 7,847
Prepaid expenses 9,095 10,560
Hedge collateral 2,680 2,940
Other current assets 24,572 15,766
Total current assets 277,745 337,853
Property, plant and equipment, net 96,141 110,747
Operating lease right-of-use assets 4,725 5,265
Intangible assets, net 1,583 1,930
Long-term prepaid expenses 6,124 10,939
Deferred income taxes 36,358 38,324
Other non-current assets 11,622 11,587
Total assets $     434,298 $      516,645
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable $       23,446 $       17,998
Other accounts payable 8,025 9,702
Accrued expenses 9,668 9,688
Accrued income taxes 48 3,154
Operating lease liabilities 1,735 1,397
Other current liabilities 4,495 5,306
Total current liabilities 47,417 47,245
Accrued severance benefits, net 20,160 23,121
Non-current operating lease liabilities 3,167 4,091
Other non-current liabilities 9,862 14,035
Total liabilities 80,606 88,492
Commitments and contingencies
Stockholders’ equity
Common stock, $0.01 par value, 150,000,000 shares authorized, 56,655,377 shares issued and 39,667,995
outstanding at September 30, 2023 and 56,432,449 shares issued and 43,824,575 outstanding at
December 31, 2022
566 564
Additional paid-in capital 271,419 266,058
Retained earnings 304,924 335,506
Treasury stock, 16,987,382 shares at September 30, 2023 and 12,607,874 shares at December 31, 2022,
respectively
(204,645) (161,422)
Accumulated other comprehensive loss (18,572) (12,553)
Total stockholders’ equity 353,692 428,153
Total liabilities and stockholders’ equity $     434,298 $     516,645

 

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands of U.S. dollars)

(Unaudited)

Three Months

Ended

Nine Months
Ended
September 30,
2023
September 30,
2023
September 30,
2022
Cash flows from operating activities
Net loss $      (5,165) $   (30,582) $     (11,007)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities
Depreciation and amortization 4,081 12,583 11,225
Provision for severance benefits 1,267 5,358 5,163
Loss on foreign currency, net 5,415 14,532 66,335
Provision for inventory reserves 1,914 3,035 7,730
Stock-based compensation 2,171 5,383 4,487
Other, net 230 680 631
Changes in operating assets and liabilities
Accounts receivable, net (6,067) (6,409) 7,805
Inventories (1,276) 3,635 (13,208)
Other receivables 586 4,993 17,115
Other current assets (2,686) (2,291) (14,117)
Accounts payable 3,186 6,066 (14,792)
Other accounts payable (250) (6,738) (6,215)
Accrued expenses (485) 619 5,866
Accrued income taxes (42) (3,014) (11,483)
Other current liabilities (270) (741) (1,583)
Other non-current liabilities (65) (279) 523
Payment of severance benefits (455) (6,183) (4,181)
Other, net (354) (841) (50)
Net cash provided by (used in) operating activities 1,735 (194) 50,244
Cash flows from investing activities
Proceeds from settlement of hedge collateral 3,335 2,805
Payment of hedge collateral (568) (3,154) (15,282)
Purchase of property, plant and equipment (762) (2,280) (11,812)
Payment for intellectual property registration (67) (230) (301)
Collection of guarantee deposits 3,539 4,984 242
Payment of guarantee deposits (369) (7,276) (2,075)
Other 550
Net cash provided by (used in) investing activities 1,773 (4,621) (25,873)
Cash flows from financing activities
Proceeds from exercise of stock options 27 1,786
Acquisition of treasury stock (6,247) (43,087) (5,065)
Repayment of financing related to water treatment facility arrangement (123) (371) (381)
Repayment of principal portion of finance lease liabilities (23) (69) (50)
Net cash used in financing activities (6,393) (43,500) (3,710)
Effect of exchange rates on cash and cash equivalents (3,425) (10,518) (49,377)
Net decrease in cash and cash equivalents (6,310 ) (58,833) (28,716)
Cash and cash equivalents
Beginning of the period 172,954 225,477 279,547
End of the period $   166,644 $   166,644 $     250,831

 

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

RECONCILIATION OF OPERATING INCOME (LOSS) TO ADJUSTED OPERATING INCOME (LOSS)

(In thousands of U.S. dollars)

(Unaudited)

Three Months Ended Nine Months Ended
September 30,
2023
June 30,
2023
September 30,
2022
September 30,
2023
September 30,
2022
Operating income (loss) $ (9,235) $ (10,656) $ (10,008) $ (41,709) $ 4,873
Adjustments:
Equity-based compensation expense 2,171 2,092 861 5,383 4,487
Early termination and other charges, net 802 2,501 9,251 3,298
Adjusted Operating Income (Loss) $ (7,064) $ (7,762) $ (6,646) $ (27,075) $ 12,658

We present Adjusted Operating Income (Loss) as a supplemental measure of our performance. We define Adjusted Operating Income (Loss) for the periods indicated as operating income (loss) adjusted to exclude (i) Equity-based compensation expense and (ii) Early termination and other charges, net.

For the nine months ended September 30, 2023, we recorded in our consolidated statement of operations $8,449 thousand of termination related charges in connection with the voluntary resignation program that we offered to certain employees during the first quarter of 2023. For the three months ended June 30, 2023 and nine months ended September 30, 2023, we recorded $802 thousand of one-time employee incentives, in each period.

For the three and nine months ended September 30, 2022, Early termination and other charges, net includes $2,821 thousand of one-time employee incentives, in each period, and professional service fees and expenses of $217 thousand and $1,014 thousand, respectively, incurred in connection with certain strategic evaluations, both of which were offset in part by a $537 thousand gain on sale of certain legacy equipment of the closed back-end line in our fabrication facility in Gumi.

 

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

RECONCILIATION OF NET LOSS TO ADJUSTED EBITDA AND ADJUSTED NET INCOME (LOSS)

(In thousands of U.S. dollars, except share data)

(Unaudited)

Three Months Ended Nine Months Ended
September 30,
2023
June 30,
2023
September 30,
2022
September 30,
2023
September 30,
2022
Net loss $           (5,165) $         (3,947) $        (17,195) $       (30,582) $       (11,007)
Adjustments:
Interest income (2,382) (2,692) (1,784) (7,916) (3,560)
Interest expense 189 200 278 645 888
Income tax benefit (4,373) (2,977) (3,942) (8,577) (1,356)
Depreciation and amortization 4,081 4,145 3,623 12,583 11,225
EBITDA (7,650) (5,271) (19,020 ) (33,847) (3,810)
Equity-based compensation expense 2,171 2,092 861 5,383 4,487
Foreign currency loss (gain), net 2,583 (1,237) 12,809 4,776 20,511
Derivative valuation loss (gain), net 161 20 (146) 235 (201)
Early termination and other charges, net 802 2,501 9,251 3,298
Adjusted EBITDA $           (2,735) $         (3,594) $         (2,995) $      (14,202) $       24,285
Net loss $           (5,165) $        (3,947) $        (17,195) $      (30,582) $     (11,007)
Adjustments:
Equity-based compensation expense 2,171 2,092 861 5,383 4,487
Foreign currency loss (gain), net 2,583 (1,237) 12,809 4,776 20,511
Derivative valuation loss (gain), net 161 20 (146) 235 (201)
Early termination and other charges, net 802 2,501 9,251 3,298
Income tax effect on non-GAAP adjustments (1,341) (202) 2,267 (3,493) 7,512
Adjusted Net Income (Loss) $           (1,591) $         (2,472) $           1,097 $      (14,430) $     24,600
Adjusted Net Income (Loss) per common share—
– Basic $             (0.04) $           (0.06) $             0.02 $         (0.35) $           0.55
– Diluted $             (0.04) $           (0.06) $             0.02 $         (0.35) $           0.53
Weighted average number of shares – basic 40,145,290 41,741,310 44,865,266 41,747,255 45,119,214
Weighted average number of shares – diluted 40,145,290 41,741,310 45,747,255 41,747,255 46,134,231

We present Adjusted EBITDA and Adjusted Net Income (Loss) as supplemental measures of our performance. We define Adjusted EBITDA for the periods indicated as EBITDA (as defined below), adjusted to exclude (i) Equity-based compensation expense, (ii) Foreign currency loss (gain), net, (iii) Derivative valuation loss (gain), net and (iv) Early termination and other charges, net. EBITDA for the periods indicated is defined as net loss before interest income, interest expense, income tax benefit and depreciation and amortization.

We prepare Adjusted Net Income (Loss) by adjusting net loss to eliminate the impact of a number of non-cash expenses and other items that may be either one time or recurring that we do not consider to be indicative of our core ongoing operating performance. We believe that Adjusted Net Income (Loss) is particularly useful because it reflects the impact of our asset base and capital structure on our operating performance. We define Adjusted Net Income (Loss) for the periods as net loss, adjusted to exclude (i) Equity-based compensation expense, (ii) Foreign currency loss (gain), net, (iii) Derivative valuation loss (gain), net, (iv) Early termination and other charges, net and (v) Income tax effect on non-GAAP adjustments.

For the nine months ended September 30, 2023, we recorded in our consolidated statement of operations $8,449 thousand of termination related charges in connection with the voluntary resignation program that we offered to certain employees during the first quarter of 2023. For the three months ended June 30, 2023 and nine months ended September 30, 2023, we recorded $802 thousand of one-time employee incentives, in each period.

For the three and nine months ended September 30, 2022, Early termination and other charges, net includes $2,821 thousand of one-time employee incentives, in each period, and professional service fees and expenses of $217 thousand and $1,014 thousand, respectively, incurred in connection with certain strategic evaluations, both of which were offset in part by a $537 thousand gain on sale of certain legacy equipment of the closed back-end line in our fabrication facility in Gumi.

 

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SOURCE Magnachip Semiconductor Corporation

SEOUL, South KoreaOct. 20, 2023 /PRNewswire/ — Magnachip Semiconductor Corporation (“Magnachip”) (NYSE: MX) announced today that it will report its financial results for the third quarter ended September 30, 2023, on Thursday, November 2, 2023, after the market closes. The Company will host a corresponding conference call at 2:00 p.m. PT / 5:00 p.m. ET to discuss its financial results.

Magnachip Semiconductor

In advance of the conference call, all participants must use the following link to complete the online registration process. Upon registering, each participant will receive access details for this event including the dial-in numbers, a PIN number, and an e-mail with detailed instructions to join the conference call.

Online registration: https://register.vevent.com/register/BI9578e24ef24a498a8d8ee6536b08edc6

A live and archived webcast of the conference call and a copy of earnings release will be accessible from the ‘Investors’ section of the company’s website at www.magnachip.com.

About Magnachip Semiconductor Corporation

Magnachip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, computing, industrial and automotive applications. The Company provides a broad range of standard products to customers worldwide. Magnachip, with more than 40 years of operating history, owns a portfolio of approximately 1,100 registered patents and pending applications, and has extensive engineering, design and manufacturing process expertise. For more information, please visit www.magnachip.com/cn. Information on or accessible through Magnachip’s website is not a part of, and is not incorporated into, this release.

 

CONTACTS:

Yujia Zhai
The Blueshirt Group
Tel. (860) 214-0809
Yujia@blueshirtgroup.com

 

View original content to download multimedia: https://www.prnewswire.com/news-releases/magnachip-to-announce-third-quarter-2023-financial-results-on-november-2-301963386.html

SOURCE Magnachip Semiconductor Corporation

SEOUL, South KoreaSept. 6, 2023 /PRNewswire/ — Magnachip Semiconductor Corporation (NYSE: MX) (“Magnachip” or the “Company”) received a letter of resignation, dated September 5, 2023, from Mr. Mel Keating, a member of the board of directors of the Company (the “Board”), whose resignation was accepted by the Board and effective as of September 5, 2023.

Magnachip SemiconductorNow that the Company has announced its plan to separate its Display and Power operations into two distinct legal entities, Mr. Keating has decided that, after over 7 years of service as a member of the Board, during which time he led the Audit Committee and the Strategic Review Committee, and given other important and time consuming business obligations, it was the right time to conclude his service to the company.

Mr. Keating’s resignation is not due to any disagreement with the company over any of its financial reporting, operations, policies or practices.

 

About Magnachip Semiconductor
Magnachip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, computing, industrial and automotive applications. The Company provides a broad range of standard products to customers worldwide. Magnachip, with more than 40 years of operating history, owns a portfolio of approximately 1,100 registered patents and pending applications, and has extensive engineering, design, and manufacturing process expertise. For more information, please visit www.magnachip.com/cn. Information on or accessible through Magnachip’s website is not a part of, and is not incorporated into, this release.

 

CONTACT:
Yujia Zhai
The Blueshirt Group
Tel. (860) 214-0809
Yujia@blueshirtgroup.com

Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/magnachip-semiconductor-corporation-announces-resignation-of-mel-keating-as-a-member-of-the-board-of-directors-301918535.html

SOURCE Magnachip Semiconductor Corporation

Magnachip Reports Results for Second Quarter 2023

Announces New $50 Million Stock Buyback Program

 

  • Revenue of $61.0 million was in-line with guidance (vs $60.5M mid-point) and was down 39.8% YoY and up 7% sequentially.
  • Gross profit margin was 22.2%, up 100 basis points from Q1. The sequential improvement was primarily driven by higher utilization at our Gumi Fab.
  • GAAP diluted loss per share was $0.09; Non-GAAP diluted loss per share was $0.06.
  • Completed $25.5 million of stock buyback during the quarter.
  • Ended the quarter with a strong balance sheet with $173 million cash and no debt.
  • Board of Directors authorized a new $50 million stock buyback program.

 

SEOUL, South KoreaAug. 7, 2023 /PRNewswire/ — Magnachip Semiconductor Corporation (NYSE: MX) (“Magnachip” or the “Company”) today announced financial results for the second quarter 2023.

 

YJ Kim, Magnachip’s chief executive officer commented, “Our year-over-year results continued to be impacted by macro challenges but I am pleased to see sequential improvement in our Power business driven by Industrial and Automotive applications. We also continued our strong pace of design-in and design win activities during the quarter. Looking forward, we expect to see further sequential growth in our Power business in Q3.”

YJ Kim continued, “In our Display business, we continue to collaborate closely with our new global panel customer. We are very optimistic about our long-term growth prospects, as our products offer compelling competitive advantages that will enable us to penetrate the rapidly expanding OLED market in Asia. Additionally, we are pleased to announce our Board of Directors’ authorization of a new $50 million stock buyback program as part of our commitment to enhance shareholder value.”

 

Q2 2023 Financial Highlights
In thousands of U.S. dollars, except share data
GAAP
Q2 2023 Q1 2023 Q/Q change Q2 2022 Y/Y change
Revenues
Standard Products Business
Display Solutions 9,657 10,841 down 10.9 % 28,336 down 65.9 %
Power Solutions 41,718 40,673 up 2.6 % 62,952 down 33.7 %
Transitional Fab 3 foundry services(1) 9,604 5,491 up 74.9 % 10,088 down 4.8 %
Gross Profit Margin 22.2 % 21.2 % up 1.0 %pts 28.6 % down 6.4 %pts
Operating Income (Loss) (10,656) (21,818) up n/a 2,002 down n/a
Net Income (Loss) (3,947) (21,470) up n/a (3,340) down n/a
Basic Loss per Common Share (0.09) (0.49) up n/a (0.07) down n/a
Diluted Loss per Common Share (0.09) (0.49) up n/a (0.07) down n/a
In thousands of U.S. dollars, except share data
Non-GAAP(2)
Q2 2023 Q1 2023 Q/Q change Q2 2022 Y/Y change
Adjusted Operating Income (Loss) (7,762) (12,249) up n/a 4,787 down n/a
Adjusted EBITDA (3,594) (7,873) up n/a 8,525 down n/a
Adjusted Net Income (Loss) (2,472) (10,367) up n/a 10,567 down n/a
Adjusted Earnings (Loss) per Common Share—Diluted (0.06) (0.24) up n/a 0.23 down n/a
___________
(1) Following the consummation of the sale of the Foundry Services Group business and Fab 4 in Q3 2020, and for a period of up to three years, we will provide transitional foundry services to the buyer for foundry products manufactured in our fabrication facility located in Gumi (“Transitional Fab 3 Foundry Services”). Management believes that disclosing revenue of Transitional Fab 3 Foundry Services separately from the standard products business allows investors to better understand the results of our core standard products display solutions and power solutions businesses.
(2) 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 our 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 (loss) 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.

 

Financial Guidance
While actual results may vary, Magnachip currently expects the following for Q3 2023:

  • Revenue to be in the range of $59 million to $65 million, including about $8 million of Transitional Fab 3 Foundry Services.
  • Gross profit margin to be in the range of 22.5% to 24.5%.

 

Q2 2023 Earnings Conference Call
Magnachip will host a corresponding conference call at 2:00 p.m. PT / 5:00 p.m. ET on Monday, August 7, 2023, to discuss its financial results. In advance of the conference call, all participants must use the following link to complete the online registration process. Upon registering, each participant will receive access details for this event including the dial-in numbers, a PIN number, and an e-mail with detailed instructions to join the conference call. A live and archived webcast of the conference call and a copy of earnings release will be accessible from the ‘Investors’ section of the Company’s website at www.magnachip.com/cn.

 

Online registration: https://register.vevent.com/register/BI115ecf6f0d5b4f12ae6130b5b7b40ff1

 

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 expectations about estimated historical or future operating results and financial performance, outlook and business plans, including third quarter 2023 revenue and gross profit margin expectations, and the impact of market conditions associated with inflation and higher interest rates, remaining effects from the COVID-19 pandemic, geopolitical conflict between Russia and Ukraine, escalated trade tensions between the U.S. and China and continuing supply constraints on Magnachip’s third quarter 2023 and future operating results. 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, among others: the impact of changes in macroeconomic conditions, including those caused by or related to inflation, potential recessions or other deteriorations, economic instability or civil unrest; remaining effects from the COVID-19 pandemic, the geopolitical conflict between Russia and Ukraine, and escalated trade tensions between the U.S. and China; manufacturing capacity constraints or supply chain disruptions that may impact our ability to deliver our products or affect the price of components, which may lead to an increase in our costs and impact demand for our products from customers who are similarly affected by such capacity constraints or disruptions; the impact of competitive products and pricing; timely -acceptance of our designs by customers; timely introduction of new products and technologies; our ability to ramp new products into volume production; industry-wide shifts in supply and demand for semiconductor products; overcapacity within the industry or at Magnachip; 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 that can be eliminated; compliance with U.S. and international trade and export laws and regulations by us, our customers and our distributors; change to or ratification of local or international laws and regulations, including those related to environment, health and safety; public health issues, including the remaining effects of the COVID-19 pandemic; 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 U.S. Securities and Exchange Commission (the “SEC”), including our Form 10-K filed on February 22, 2023, 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.

 

About Magnachip Semiconductor
Magnachip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, computing, industrial and automotive applications. The Company provides a broad range of standard products to customers worldwide. Magnachip, with more than 40 years of operating history, owns a portfolio of approximately 1,100 registered patents and pending applications, and has extensive engineering, design, and manufacturing process expertise. For more information, please visit www.magnachip.com/cn. Information on or accessible through Magnachip’s website is not a part of, and is not incorporated into, this release.

 

CONTACT:
Yujia Zhai
The Blueshirt Group
Tel. (860) 214-0809
Yujia@blueshirtgroup.com

 

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands of U.S. dollars, except share data)

(Unaudited)

Three Months Ended Six Months Ended
June 30,
2023
March 31,
2023
June 30,
2022
June 30,
2023
June 30,
2022
Revenues:
Net sales – standard products business $         51,375 $         51,514 $         91,288 $       102,889 $       185,298
Net sales – transitional Fab 3 foundry services 9,604 5,491 10,088 15,095 20,171
Total revenues 60,979 57,005 101,376 117,984 205,469
Cost of sales:
Cost of sales – standard products business 37,867 37,312 63,620 75,179 119,700
Cost of sales – transitional Fab 3 foundry services 9,574 7,599 8,811 17,173 17,828
Total cost of sales 47,441 44,911 72,431 92,352 137,528
Gross profit 13,538 12,094 28,945 25,632 67,941
Gross profit as a percentage of standard products business net sales 26.3 % 27.6 % 30.3 % 26.9 % 35.4 %
Gross profit as a percentage of total revenues 22.2 % 21.2 % 28.6 % 21.7 % 33.1 %
Operating expenses:
Selling, general and administrative expenses 12,137 12,165 12,736 24,302 26,899
Research and development expenses 11,255 13,298 13,410 24,553 25,364
Early termination and other charges 802 8,449 797 9,251 797
Total operating expenses 24,194 33,912 26,943 58,106 53,060
Operating income (loss) (10,656) (21,818) 2,002 (32,474) 14,881
           Interest income 2,692 2,842 1,061 5,534 1,776
Interest expense (200) (256) (499) (456) (610)
Foreign currency gain (loss), net 1,237 (3,430) (7,012) (2,193) (7,702)
Other income (loss), net 3 (35) 211 (32) 429
Income (loss) before income tax expense (6,924) (22,697) (4,237) (29,621) 8,774
Income tax expense (benefit) (2,977) (1,227) (897) (4,204) 2,586
Net income (loss) $           (3,947) $        (21,470) $          (3,340) $       (25,417) $           6,188
Basic earnings (loss) per common share— $            (0.09) (0.49) $            (0.07) $           (0.60) $             0.14
Diluted earnings (loss) per common share— $            (0.09) (0.49) $            (0.07) $           (0.60) $             0.13
Weighted average number of shares—
Basic 41,741,310 43,390,832 44,897,278 42,561,514 45,248,293
Diluted 41,741,310 43,390,832 44,897,278 42,561,514 46,329,559

 

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands of U.S. dollars, except share data)

(Unaudited)

      June 30,

      2023

    December 31,

      2022

Assets
Current assets
Cash and cash equivalents $     172,954 $     225,477
Accounts receivable, net 35,009 35,380
Inventories, net 32,337 39,883
Other receivables 3,498 7,847
Prepaid expenses 9,553 10,560
Hedge collateral 2,120 2,940
Other current assets 19,070 15,766
Total current assets 274,541 337,853
Property, plant and equipment, net 101,067 110,747
Operating lease right-of-use assets 5,224 5,265
Intangible assets, net 1,706 1,930
Long-term prepaid expenses 7,430 10,939
Deferred income taxes 37,141 38,324
Other non-current assets 16,626 11,587
Total assets $     443,735 $      516,645
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable $       20,367 $       17,998
Other accounts payable 8,473 9,702
Accrued expenses 10,456 9,688
Accrued income taxes 91 3,154
Operating lease liabilities 1,745 1,397
Other current liabilities 4,506 5,306
Total current liabilities 45,638 47,245
Accrued severance benefits, net 20,123 23,121
Non-current operating lease liabilities 3,671 4,091
Other non-current liabilities 10,011 14,035
Total liabilities 79,443 88,492
Commitments and contingencies
Stockholders’ equity
Common stock, $0.01 par value, 150,000,000 shares authorized, 56,449,782 shares issued and 40,133,898
outstanding at June 30, 2023 and 56,432,449 shares issued and 43,824,575 outstanding at December 31,
2022
564 564
Additional paid-in capital 269,297 266,058
Retained earnings 310,089 335,506
Treasury stock, 16,315,884 shares at June 30, 2023 and 12,607,874 shares at December 31, 2022,
respectively
(199,248) (161,422)
Accumulated other comprehensive loss (16,410) (12,553)
Total stockholders’ equity 364,292 428,153
Total liabilities and stockholders’ equity $   443,735 $     516,645

 

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands of U.S. dollars)

(Unaudited)

Three Months
Ended
Six Months
Ended
June 30,
2023
June 30,
2023
June 30,
2022
Cash flows from operating activities
Net income (loss) $      (3,947) $   (25,417) $       6,188
Adjustments to reconcile net income (loss) to net cash provided by operating activities
Depreciation and amortization 4,145 8,502 7,602
Provision for severance benefits 1,761 4,091 3,240
Loss on foreign currency, net 35 9,117 29,183
Provision for inventory reserves (17) 1,121 5,282
Stock-based compensation 2,092 3,212 3,626
Other, net 213 450 712
Changes in operating assets and liabilities
Accounts receivable, net (3,315) (342) (12,377)
Inventories 3,849 4,911 (5,486)
Other receivables 2,031 4,407 11,640
Other current assets (1,061) 395 (2,089)
Accounts payable 976 2,880 2,429
Other accounts payable (5,064) (6,488) (5,861)
Accrued expenses (6,496) 1,104 (2,709)
Accrued income taxes (49) (2,972) (11,513)
Other current liabilities 125 (471) (2,153)
Other non-current liabilities (45) (214) 570
Payment of severance benefits (4,857) (5,728) (2,934)
Other, net (181) (487) (385)
Net cash provided by (used in) operating activities (9,805) (1,929) 24,965
Cash flows from investing activities
Proceeds from settlement of hedge collateral 2,180 3,335 2,805
Payment of hedge collateral (1,493) (2,586) (6,844)
Purchase of property, plant and equipment (1,383) (1,518) (1,511)
Payment for intellectual property registration (89) (163) (153)
Payment of guarantee deposits (3,425) (6,907) (1,049)
Other, net 1,426 1,445 14
Net cash used in investing activities (2,784) (6,394 ) (6,738 )
Cash flows from financing activities
Proceeds from exercise of stock options 18 27 1,786
Acquisition of treasury stock (24,576) (36,840) (1,826)
Repayment of financing related to water treatment facility arrangement (122) (248) (261)
Repayment of principal portion of finance lease liabilities (22) (46) (32)
Net cash used in financing activities (24,702) (37,107) (333)
Effect of exchange rates on cash and cash equivalents (1,840) (7,093) (23,644)
Net decrease in cash and cash equivalents (39,131) (52,523) (5,750)
Cash and cash equivalents
Beginning of the period 212,085 225,477 279,547
End of the period $   172,954 $   172,954 $   273,797

 

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

RECONCILIATION OF OPERATING INCOME (LOSS) TO ADJUSTED OPERATING INCOME (LOSS)

(In thousands of U.S. dollars)

(Unaudited)

Three Months Ended Six Months Ended
June 30,
2023
March 31,
2023
June 30,
2022
June 30,
2023
June 30,
2022
Operating income (loss) $ (10,656) $ (21,818) $ 2,002 $ (32,474) $ 14,881
Adjustments:
Equity-based compensation expense 2,092 1,120 1,988 3,212 3,626
Early termination and other charges 802 8,449 797 9,251 797
Adjusted Operating Income (Loss) $ (7,762) $ (12,249) $ 4,787 $ (20,011) $ 19,304

 

We present Adjusted Operating Income (Loss) as a supplemental measure of our performance. We define Adjusted Operating Income (Loss) for the periods indicated as operating income (loss) adjusted to exclude (i) Equity-based compensation expense and (ii) Early termination and other charges.

For the three months ended March 31, 2023, we recorded in our consolidated statement of operations $8,449 thousand of termination related charges in connection with the voluntary resignation program that we offered to certain employees during the first quarter of 2023. For the three and six months ended June 30, 2023, we recorded $802 thousand of one-time employee incentives.

For the three and six months ended June 30, 2022, we recorded $797 thousand of professional service fees and expenses incurred in connection with certain strategic evaluations.

 

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA AND ADJUSTED NET INCOME (LOSS)

(In thousands of U.S. dollars, except share data)

(Unaudited)

Three Months Ended Six Months Ended
June 30,
2023
March 31,
2023
June 30,
2022
June 30,
2023
June 30,
2022
Net income (loss) $           (3,947) $        (21,470) $         (3,340) $       (25,417) $        6,188
Adjustments:
Interest income (2,692) (2,842) (1,061) (5,534) (1,776 )
Interest expense 200 256 499 456 610
Income tax expense (benefit) (2,977) (1,227) (897) (4,204) 2,586
Depreciation and amortization 4,145 4,357 3,711 8,502 7,602
EBITDA (5,271) (20,926) (1,088) (26,197) 15,210
Equity-based compensation expense 2,092 1,120 1,988 3,212 3,626
Foreign currency loss (gain), net (1,237) 3,430 7,012 2,193 7,702
Derivative valuation loss (gain), net 20 54 (184) 74 (55 )
Early termination and other charges 802 8,449 797 9,251 797
Adjusted EBITDA $           (3,594) $        (7,873) $          8,525 $      (11,467) $       27,280
Net income (loss) $           (3,947) $       (21,470) $         (3,340) $      (25,417) $        6,188
Adjustments:
Equity-based compensation expense 2,092 1,120 1,988 3,212 3,626
Foreign currency loss (gain), net (1,237) 3,430 7,012 2,193 7,702
Derivative valuation loss (gain), net 20 54 (184) 74 (55 )
Early termination and other charges 802 8,449 797 9,251 797
Income tax effect on non-GAAP adjustments (202) (1,950) 4,294 (2,152) 5,245
Adjusted Net Income (Loss) $           (2,472) $      (10,367) $        10,567 $      (12,839) $     23,503
Adjusted Net Income (Loss) per common share—
– Basic $             (0.06) $          (0.24) $            0.24 $        (0.30) $          0.52
– Diluted $             (0.06) $          (0.24) $            0.23 $        (0.30) $          0.51
Weighted average number of shares – basic 41,741,310 43,390,832 44,897,278 42,561,514 45,248,293
Weighted average number of shares – diluted 41,741,310 43,390,832 45,937,515 42,561,514 46,329,559

 

We present Adjusted EBITDA and Adjusted Net Income (Loss) as supplemental measures of our performance. We define Adjusted EBITDA for the periods indicated as EBITDA (as defined below), adjusted to exclude (i) Equity-based compensation expense, (ii) Foreign currency loss (gain), net, (iii) Derivative valuation loss (gain), net and (iv) Early termination and other charges. EBITDA for the periods indicated is defined as net income (loss) before interest income, interest expense, income tax expense (benefit) and depreciation and amortization.

We prepare Adjusted Net Income (Loss) by adjusting net income (loss) to eliminate the impact of a number of non-cash expenses and other items that may be either one time or recurring that we do not consider to be indicative of our core ongoing operating performance. We believe that Adjusted Net Income (Loss) is particularly useful because it reflects the impact of our asset base and capital structure on our operating performance. We define Adjusted Net Income (Loss) for the periods as net income (loss), adjusted to exclude (i) Equity-based compensation expense, (ii) Foreign currency loss (gain), net, (iii) Derivative valuation loss (gain), net, (iv) Early termination and other charges and (v) Income tax effect on non-GAAP adjustments.

For the three months ended March 31, 2023, we recorded in our consolidated statement of operations $8,449 thousand of termination related charges in connection with the voluntary resignation program that we offered to certain employees during the first quarter of 2023. For the three and six months ended June 30, 2023, we recorded $802 thousand of one-time employee incentives.

For the three and six months ended June 30, 2022, we recorded $797 thousand of professional service fees and expenses incurred in connection with certain strategic evaluations.

Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/magnachip-reports-results-for-second-quarter-2023-announces-new-50-million-stock-buyback-program-301894919.html

SOURCE Magnachip Semiconductor Corporation

SEOUL, South Korea, July 19, 2023 /PRNewswire/ — Magnachip Semiconductor Corporation (“Magnachip”) (NYSE: MX) announced today that it will report its financial results for the second quarter ended June 30, 2023, on Monday, August 7, 2023, after the market close. The Company will host a corresponding conference call at 2:00 p.m. PT / 5:00 p.m. ET to discuss its financial results.

In advance of the conference call, all participants must use the following link to complete the online registration process. Upon registering, each participant will receive access details for this event including the dial-in numbers, a PIN number, and an e-mail with detailed instructions to join the conference call.

Online registration: https://register.vevent.com/register/BI115ecf6f0d5b4f12ae6130b5b7b40ff1

A live and archived webcast of the conference call and a copy of earnings release will be accessible from the ‘Investors’ section of the company’s website at https://www.magnachip.com/cn.

 

About Magnachip Semiconductor Corporation

Magnachip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, computing, industrial and automotive applications. The Company provides a broad range of standard products to customers worldwide. Magnachip, with more than 40 years of operating history, owns a portfolio of approximately 1,100 registered patents and pending applications, and has extensive engineering, design and manufacturing process expertise. For more information, please visit https://www.magnachip.com/cn. Information on or accessible through Magnachip’s website is not a part of, and is not incorporated into, this release.

 

CONTACTS:

Yujia Zhai
The Blueshirt Group
Tel. (860) 214-0809
Yujia@blueshirtgroup.com

Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/magnachip-to-announce-second-quarter-2023-financial-results-on-august-7-301880239.html

SOURCE Magnachip Semiconductor Corporation

SEOUL, South KoreaJuly 17, 2023 /PRNewswire/ — Magnachip Semiconductor Corporation (NYSE: MX) (“Magnachip” or the “Company”) today announced that Gary Tanner has notified the Company of his intention to resign from the Company’s Board of Directors. The Board has accepted his resignation, which was effective as of July 14, 2023.

Mr. Tanner joined Magnachip’s Board in August 2015 and has served in multiple capacities, such as Non-Executive Chairman of the Board, Chair of the Risk Committee, and a member of the Audit, Compensation and Strategic Review Committees. During his tenure, Mr. Tanner has been instrumental to the Company’s trajectory, contributing to the Company’s strategic vision, operational details and corporate governance. Most recently, Mr. Tanner led the establishment of the Risk Committee’s oversight of the Company’s corporate objectives, goals, strategies and initiatives relating to, and attending risks associated with, environmental, social and governance (“ESG”) matters, including corporate social responsibility, sustainability, public policy and other related matters such as the formation of a management-level ESG Steering Committee.

“Gary’s operational expertise and industry experience have been instrumental to our success and he will be greatly missed,” said Camillo Martino, Magnachip’s Chairman of the Board. “He has consistently brought a valuable perspective to our board deliberations. On behalf of the entire board, I thank him for his service to Magnachip and wish him well in his future endeavors.”

“The Company and the management team would like to express their gratitude to Gary for his dedicated service over the past eight years. He leaves a legacy of excellence that has positioned us well for the future,” said YJ Kim, Chief Executive Officer of Magnachip. “His strategic vision and his commitment to our stakeholders have been a source of inspiration to all of us. We are thankful for his years of service and his commitment to our success.”

Mr. Tanner’s departure is due to personal reasons. The Company will immediately begin a search for a new independent director to replace Mr. Tanner.

 

About Magnachip Semiconductor
Magnachip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, computing, industrial and automotive applications. The Company provides a broad range of standard products to customers worldwide. Magnachip, with more than 40 years of operating history, owns a portfolio of approximately 1,100 registered patents and pending applications, and has extensive engineering, design, and manufacturing process expertise. For more information, please visit https://www.magnachip.com/cn. Information on or accessible through Magnachip’s website is not a part of, and is not incorporated into, this release.

 

CONTACT:
Yujia Zhai
The Blueshirt Group
Tel. (860) 214-0809
Yujia@blueshirtgroup.com

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SOURCE Magnachip Semiconductor Corporation

SEOUL, South KoreaMay 30, 2023 /PRNewswire/ — Magnachip Semiconductor Corporation (NYSE: MX) (“Magnachip” or the “Company”) today announced that the Company is separating its display and power businesses into separate entities, following approval by its board of directors and strategic review committee.

YJ Kim, Magnachip’s chief executive officer commented, “This strategic separation represents a significant milestone for Magnachip and underscores the Company’s commitment to unlocking long-term value for our shareholders. The internal separation is aimed at enhancing transparency, accountability and flexibility in business. By establishing distinct entities, we believe our investors will be able to better evaluate the financial performance of each business and their respective contributions. Furthermore, this strategic move will allow each entity to allocate its resources, both financial and technical, more effectively to the specific needs of its customers.”

YJ Kim continued, “Magnachip remains dedicated to delivering innovative solutions and exceptional customer experiences in both the display and power sectors, and we are confident that this separation will strengthen our ability to achieve these objectives by enhancing each business’s agility and focus.”

The Company plans to effectuate the internal separation (the “Internal Split-Off”) by establishing a new subsidiary (“NewCo”) under Magnachip Semiconductor, Ltd. (“Magnachip Korea”), the Company’s operating subsidiary. As part of the transaction, all assets and liabilities of the display business will be contributed to NewCo in exchange for equity. Once the Internal Split-Off is completed, Magnachip Korea and NewCo will both be separate operating companies, with NewCo being a wholly owned subsidiary of Magnachip Korea. The Company’s Gumi fabrication facility will remain with Magnachip Korea as an integral part of its power business.

Post-separation, the board of directors of Magnachip will continue to oversee both operating entities, ensuring cohesive governance, while YJ Kim and the executive management team will manage their business and operations. Each of Magnachip Korea and NewCo will remain indirect wholly owned subsidiaries of Magnachip, and the Internal Split-Off is not expected to have any material impact on the Company’s financial reporting or consolidated financial statements.

The Internal Split-Off is expected to be completed in the fourth quarter of 2023.

 

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 expectations about estimated historical or future operating results and financial performance, outlook and business plans, including our expectations regarding the Internal Split-Off benefits and the timing for its completion, and the impact of market conditions associated with inflation and higher interest rates, remaining effects from the COVID-19 pandemic, geopolitical conflict between Russia and Ukraine, escalated trade tensions between the U.S. and China and continuing supply constraints on Magnachip’s second quarter 2023 and future operating results. 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, among others: the impact of changes in macroeconomic conditions, including those caused by or related to inflation, potential recessions or other deteriorations, economic instability or civil unrest; remaining effects from the COVID-19 pandemic, the geopolitical conflict between Russia and Ukraine, and escalated trade tensions between the U.S. and China; manufacturing capacity constraints or supply chain disruptions that may impact our ability to deliver our products or affect the price of components, which may lead to an increase in our costs and impact demand for our products from customers who are similarly affected by such capacity constraints or disruptions; the impact of competitive products and pricing; timely -acceptance of our designs by customers; timely introduction of new products and technologies; our ability to ramp new products into volume production; industry-wide shifts in supply and demand for semiconductor products; overcapacity within the industry or at Magnachip; 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 that can be eliminated; compliance with U.S. and international trade and export laws and regulations by us, our customers and our distributors; change to or ratification of local or international laws and regulations, including those related to environment, health and safety; public health issues, including the remaining effects of the COVID-19 pandemic; 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 U.S. Securities and Exchange Commission (the “SEC”), including our Form 10-K filed on February 22, 2023, 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.

 

About Magnachip Semiconductor

Magnachip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, computing, industrial and automotive applications. The Company provides a broad range of standard products to customers worldwide. Magnachip, with more than 40 years of operating history, owns a portfolio of approximately 1,100 registered patents and pending applications, and has extensive engineering, design, and manufacturing process expertise. For more information, please visit www.magnachip.com/cn. Information on or accessible through Magnachip’s website is not a part of, and is not incorporated into, this release.

 

CONTACT:
Yujia Zhai
The Blueshirt Group
Tel. (860) 214-0809
Yujia@blueshirtgroup.com

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SOURCE Magnachip Semiconductor Corporation

Magnachip Reports Results for First Quarter 2023

  • Revenue of $57.0 million was within our guidance range. YoY, our revenue decreased 45.2% primarily due to continued effects of last year’s 28nm wafer supply shortage that impacted second half 2022 design-wins and the ongoing inventory correction driven by weak consumer demand.
  • Gross profit margin was 21.2%, at the low end of our guidance range. The sequential decrease was primarily due to lower utilization rate of our internal fabrication facility in response to the industry-wide slowdown and higher fab costs.
  • GAAP diluted loss per share was $0.49.
  • Non-GAAP diluted loss per share was $0.24.

 

SEOUL, South KoreaMay 3, 2023 /PRNewswire/ — Magnachip Semiconductor Corporation (NYSE: MX) (“Magnachip” or the “Company”) today announced financial results for the first quarter 2023.

(PRNewsfoto/Magnachip Semiconductor)

YJ Kim, Magnachip’s chief executive officer commented, “Our Q1 results continued to be affected by last year’s OLED wafer shortages that impacted second half design-wins and the ongoing smartphone inventory correction in our Display business and weak consumer demand in our Power business. Despite the challenging environment, we remained focused on execution during the quarter. In our Display business, we successfully delivered our second OLED DDIC project sample ahead of schedule to a large non-Korean panel customer and remain on track for second half smartphone launches. We also completed the tape-out for a high-end smartphone project with a large Korean panel customer, with mass production on schedule near the end of this year. In our Power business, we continued our record pace of design-in and -win activities, driven by momentum in industrial, automotive and computing applications. Looking ahead, the macro environment remains uncertain. However, we believe we are bumping along the bottom for the Display business and we have hit the bottom in Q1 for our Power business.”

YJ Kim continued, “Overall, we expect our financial results to remain soft in the near term, but we believe both Display and Power are poised for a recovery in the second half of this year based on our current customer feedback.”

 

Q1 2023 Financial Highlights
In thousands of U.S. dollars, except share data
GAAP
Q1 2023 Q4 2022 Q/Q change Q1 2022 Y/Y change
Revenues
Standard Products Business
Display Solutions 10,841 7,556 up 43.5 % 29,185 down 62.9 %
Power Solutions 40,673 46,271 down 12.1 % 64,825 down 37.3 %
Transitional Fab 3 foundry services(1) 5,491 7,163 down 23.3 % 10,083 down 45.5 %
Gross Profit Margin 21.2 % 26.4 % down 5.2 %pts 37.5 % down 16.3 %pts
Operating Income (Loss) (21,818 (10,117) down n/a 12,879 down n/a
Net Income (Loss) (21,470 2,971 down n/a 9,528 down n/a
Basic Earnings (Loss) per Common Share (0.49 0.07 down n/a 0.21 down n/a
Diluted Earnings (Loss) per Common Share (0.49 0.07 down n/a 0.20 down n/a
In thousands of U.S. dollars, except share data
Non-GAAP(2)
Q1 2023 Q4 2022 Q/Q change Q1 2022 Y/Y change
Adjusted Operating Income (Loss) (12,249 (8,567) down n/a 14,517 down n/a
Adjusted EBITDA (7,873 (4,768) down n/a 18,755 down n/a
Adjusted Net Income (Loss) (10,367 (15,848) up n/a 12,936 down n/a
Adjusted Earnings (Loss) per Common Share—Diluted (0.24 (0.36) up n/a 0.28 down n/a
__________________
(1) Following the consummation of the sale of the Foundry Services Group business and Fab 4 in Q3 2020, and for a period of up to three years, we will provide transitional
foundry services to the buyer for foundry products manufactured in our fabrication facility located in Gumi (“Transitional Fab 3 Foundry Services”). Management believes
that disclosing revenue of Transitional Fab 3 Foundry Services separately from the standard products business allows investors to better understand the results of our core
standard products display solutions and power solutions businesses.
(2) 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 our 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 (loss) 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.

 

Financial Guidance

While actual results may vary, Magnachip currently expects the following for Q2 2023:

  • Revenue to be in the range of $58 million to $63 million, including about $8 millions of Transitional Fab 3 Foundry Services.
  • Gross profit margin to be in the range of 21% to 23%.

Based on our current projections, and assuming a steady state global economy, we are cautiously optimistic that our key financial metrics have the potential to show sequential improvement in both the third and fourth quarters of 2023.

 

Q1 2023 Earnings Conference Call

Magnachip will host a corresponding conference call at 2:00 p.m. PT / 5:00 p.m. ET on Thursday, May 3, 2023, to discuss its financial results. In advance of the conference call, all participants must use the following link to complete the online registration process. Upon registering, each participant will receive access details for this event including the dial-in numbers, a PIN number, and an e-mail with detailed instructions to join the conference call. A live and archived webcast of the conference call and a copy of earnings release will be accessible from the ‘Investors’ section of the Company’s website at www.magnachip.com/cn.

 

Online registration: https://register.vevent.com/register/BI51f45e599c544fe9bad00a197e100fca

 

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 expectations about estimated historical or future operating results and financial performance, outlook and business plans, including second quarter 2023, third quarter 2023 and full year 2023 revenue and gross profit margin expectations, and the impact of market conditions associated with inflation and higher interest rates, remaining effects from the COVID-19 pandemic, geopolitical conflict between Russia and Ukraine, escalated trade tensions between the U.S. and China and continuing supply constraints on Magnachip’s second quarter 2023 and future operating results. 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, among others: the impact of changes in macroeconomic conditions, including those caused by or related to inflation, potential recessions or other deteriorations, economic instability or civil unrest; remaining effects from the COVID-19 pandemic, the geopolitical conflict between Russia and Ukraine, and escalated trade tensions between the U.S. and China; manufacturing capacity constraints or supply chain disruptions that may impact our ability to deliver our products or affect the price of components, which may lead to an increase in our costs and impact demand for our products from customers who are similarly affected by such capacity constraints or disruptions; the impact of competitive products and pricing; timely -acceptance of our designs by customers; timely introduction of new products and technologies; our ability to ramp new products into volume production; industry-wide shifts in supply and demand for semiconductor products; overcapacity within the industry or at Magnachip; 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 that can be eliminated; compliance with U.S. and international trade and export laws and regulations by us, our customers and our distributors; change to or ratification of local or international laws and regulations, including those related to environment, health and safety; public health issues, including the remaining effects of the COVID-19 pandemic; 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 U.S. Securities and Exchange Commission (the “SEC”), including our Form 10-K filed on February 22, 2023, 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.

 

About Magnachip Semiconductor

Magnachip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, computing, industrial and automotive applications. The Company provides a broad range of standard products to customers worldwide. Magnachip, with more than 40 years of operating history, owns a portfolio of approximately 1,100 registered patents and pending applications, and has extensive engineering, design, and manufacturing process expertise. For more information, please visit www.magnachip.com/cn. Information on or accessible through Magnachip’s website is not a part of, and is not incorporated into, this release.

 

CONTACT:
Yujia Zhai
The Blueshirt Group
Tel. (860) 214-0809
Yujia@blueshirtgroup.com

 

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands of U.S. dollars, except share data)

(Unaudited)

Three Months Ended
     March 31,       December 31,       March 31,
2023 2022 2022
Revenues:
Net sales – standard products business $ 51,514 $ 53,827 $ 94,010
Net sales – transitional Fab 3 foundry services 5,491 7,163 10,083
Total revenues 57,005 60,990 104,093
Cost of sales:
Cost of sales – standard products business 37,312 37,150 56,080
Cost of sales – transitional Fab 3 foundry services 7,599 7,742 9,017
Total cost of sales 44,911 44,892 65,097
Gross profit 12,094 16,098 38,996
Gross profit as a percentage of standard products business net sales 27.6 % 31.0 % 40.3 %
Gross profit as a percentage of total revenues 21.2 % 26.4 % 37.5 %
Operating expenses:
Selling, general and administrative expenses 12,165 12,562 14,163
Research and development expenses 13,298 13,653 11,954
Early termination charges 8,449
Total operating expenses 33,912 26,215 26,117
Operating income (loss) (21,818) (10,117) 12,879
Interest income 2,842) 2,420 715)
Interest expense (256) (269) (111)
Foreign currency gain (loss), net (3,430) 17,492 (690)
Other income (expense), net (35) (42) 218
Income (loss) before income tax expense (22,697) 9,484 13,011
Income tax expense (benefit) (1,227) 6,513 3,483
Net income (loss) $ (21,470) $ 2,971 $ 9,528
Basic earnings (loss) per common share— $ (0.49) $ 0.07 $ 0.21
Diluted earnings (loss) per common share— $ (0.49) $ 0.07 $ 0.20
Weighted average number of shares—
Basic 43,390,832 44,054,275 45,603,208
Diluted 43,390,832 44,731,683 46,693,294

 

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands of U.S. dollars, except share data)

(Unaudited)

      March 31,

      2023

    December 31,

      2022

Assets
Current assets
Cash and cash equivalents $     212,085 $     225,477
Accounts receivable, net 32,143 35,380
Inventories, net 36,360 39,883
Other receivables 5,342 7,847
Prepaid expenses 11,238 10,560
Hedge collateral 2,820 2,940
Other current assets 14,927 15,766
Total current assets 314,915 337,853
Property, plant and equipment, net 104,568 110,747
Operating lease right-of-use assets 5,413 5,265
Intangible assets, net 1,784 1,930
Long-term prepaid expenses 9,101 10,939
Deferred income taxes 37,380 38,324
Other non-current assets 14,683 11,587
Total assets $     487,844 $      516,645
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable $       19,921 $       17,998
Other accounts payable 9,216 9,702
Accrued expenses 17,125 9,688
Accrued income taxes 146 3,154
Operating lease liabilities 1,622 1,397
Other current liabilities 5,261 5,306
Total current liabilities 53,291 47,245
Accrued severance benefits, net 23,608 23,121
Non-current operating lease liabilities 3,996 4,091
Other non-current liabilities 13,596 14,035
Total liabilities 94,491 88,492
Commitments and contingencies
Stockholders’ equity
Common stock, $0.01 par value, 150,000,000 shares authorized, 56,437,182 shares issued and 42,589,315
outstanding at March 31, 2023 and 56,432,449 shares issued and 43,824,575 outstanding at December 31, 2022
564 564
Additional paid-in capital 267,187 266,058
Retained earnings 314,036 335,506
Treasury stock, 13,847,867 shares at March 31, 2023 and 12,607,874 shares at December 31, 2022, respectively (173,441) (161,422)
Accumulated other comprehensive loss (14,993) (12,553)
Total stockholders’ equity 393,353 428,153
Total liabilities and stockholders’ equity $   487,844 $     516,645

 

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands of U.S. dollars)

(Unaudited)

Three Months Ended
March 31,
2023
March 31,
2022
Cash flows from operating activities
Net income (loss) $        (21,470) $          9,528
Adjustments to reconcile net income (loss) to net cash provided by operating activities
Depreciation and amortization 4,357 3,891
Provision for severance benefits 2,330 1,670
Loss on foreign currency, net 9,082 6,380
Provision for inventory reserves 1,138 145
Stock-based compensation 1,120 1,638
Other, net 237 161
Changes in operating assets and liabilities
Accounts receivable, net 2,973 (1,213 )
Inventories 1,062 1,456
Other receivables 2,376 667
Other current assets 1,456 (6,829 )
Accounts payable 1,904 538
Other accounts payable (1,424 ) (702 )
Accrued expenses 7,600 187
Accrued income taxes (2,923 ) (2,346 )
Other current liabilities (596 ) (711 )
Other non-current liabilities (169 ) (73 )
Payment of severance benefits (871 ) (1,389 )
Other, net (306 ) (178)
Net cash provided by operating activities 7,876 12,820
Cash flows from investing activities
Proceeds from settlement of hedge collateral 1,155 1,829
Payment of hedge collateral (1,093 ) (2,891 )
Purchase of property, plant and equipment (135 ) (944 )
Payment for intellectual property registration (74 ) (59 )
Payment of guarantee deposits (3,482 ) (79 )
Other, net 19 2
Net cash used in investing activities (3,610 ) (2,142 )
Cash flows from financing activities
Proceeds from exercise of stock options 9 1,781
Acquisition of treasury stock (12,264 ) (830 )
Repayment of financing related to water treatment facility arrangement (126 ) (134 )
Repayment of principal portion of finance lease liabilities (24 ) (16 )
Net cash provided by (used in) financing activities (12,405 ) 801
Effect of exchange rates on cash and cash equivalents (5,253 ) (6,105 )
Net increase (decrease) in cash and cash equivalents (13,392 ) 5,374
Cash and cash equivalents
Beginning of the period 225,477 279,547
End of the period $      212,085 $      284,921

 

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

RECONCILIATION OF OPERATING INCOME (LOSS) TO ADJUSTED OPERATING INCOME (LOSS)

(In thousands of U.S. dollars)

(Unaudited)

Three Months Ended
March 31, December 31, March 31,
2023 2022 2022
Operating income (loss) $ (21,818) $ (10,117) $ 12,879
Adjustments:
Equity-based compensation expense 1,120 1,550 1,638
Early termination charges 8,449
Adjusted Operating Income (Loss) $ (12,249) $ (8,567) $ 14,517

We present Adjusted Operating Income (Loss) as a supplemental measure of our performance. We define Adjusted Operating Income (Loss) for the periods indicated as operating income (loss) adjusted to exclude (i) Equity-based compensation expense and (ii) Early termination charges.

For the three months ended March 31, 2023, we recorded in our consolidated statement of operations $8,449 thousand of termination related charges in connection with the voluntary resignation program that we offered to certain employees during the first quarter of 2023.

 

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA AND ADJUSTED NET INCOME (LOSS)

(In thousands of U.S. dollars, except share data)

(Unaudited)

Three Months Ended
March 31, December 31,    March 31,
2023 2022 2022
Net income (loss) $ (21,470) $ 2,971 $ 9,528
Adjustments:
Interest income (2,842) (2,420) (715)
Interest expense 256 269 111
Income tax expense (benefit) (1,227) 6,513 3,483
Depreciation and amortization 4,357 3,775 3,891
EBITDA (20,926) 11,108 16,298
Equity-based compensation expense 1,120 1,550 1,638
Foreign currency loss (gain), net 3,430 (17,492) 690
Derivative valuation loss, net 54 66 129
Early termination charges 8,449
Adjusted EBITDA $ (7,873) $ (4,768) $ 18,755
Net income (loss) $ (21,470) $ 2,971 $ 9,528
Adjustments:
Equity-based compensation expense 1,120 1,550 1,638
Foreign currency loss (gain), net 3,430 (17,492) 690
Derivative valuation loss, net 54 66 129
Early termination charges 8,449
Income tax effect on non-GAAP adjustments (1,950) (2,943) 951
Adjusted Net Income (Loss) $ (10,367) $ (15,848) $ 12,936
Adjusted Net Income (Loss) per common share—
– Basic $ (0.24) $ (0.36) $ 0.28
– Diluted $ (0.24) $ (0.36) $ 0.28
Weighted average number of shares – basic 43,390,832 44,054,275 45,603,208
Weighted average number of shares – diluted 43,390,832 44,054,275 46,693,294

We present Adjusted EBITDA and Adjusted Net Income (Loss) as supplemental measures of our performance. We define Adjusted EBITDA for the periods indicated as EBITDA (as defined below), adjusted to exclude (i) Equity-based compensation expense, (ii) Foreign currency loss (gain), net, (iii) Derivative valuation loss, net and (iv) Early termination charges. EBITDA for the periods indicated is defined as net income (loss) before interest income, interest expense, income tax expense (benefit) and depreciation and amortization.

We prepare Adjusted Net Income (Loss) by adjusting net income (loss) to eliminate the impact of a number of non-cash expenses and other items that may be either one time or recurring that we do not consider to be indicative of our core ongoing operating performance. We believe that Adjusted Net Income (Loss) is particularly useful because it reflects the impact of our asset base and capital structure on our operating performance. We define Adjusted Net Income (Loss) for the periods as net income (loss), adjusted to exclude (i) Equity-based compensation expense, (ii) Foreign currency loss (gain), net, (iii) Derivative valuation loss, net, (iv) Early termination charges and (v) Income tax effect on non-GAAP adjustments.

For the three months ended March 31, 2023, we recorded in our consolidated statement of operations $8,449 thousand of termination related charges in connection with the voluntary resignation program that we offered to certain employees during the first quarter of 2023.

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SOURCE Magnachip Semiconductor Corporation