GSI Technology, Inc. Reports Fourth Quarter and Fiscal Year 2024 Results and Business Update
GSI Technology, Inc. reported financial results for Q4 and FY 2024, showing a net loss and decreased revenue compared to FY 2023. The company launched new servers and aims for product innovation while considering strategic alternatives to enhance stockholder value. Operating loss, gross margin, and expenses were highlighted in the PR. GSI plans to sell property to strengthen financial standing and extend operational runway. The outlook for Q1 FY 2025 indicates expected net revenues and gross margin. The company's financial status, strategic review, and future plans were key points in the PR.
The launch of new high-capacity, low-power servers integrated with Gemini-I APU for SAR and Fast Vector Search applications.
Progress made in testing and debugging Gemini-II for customer sampling in the third quarter of fiscal 2025.
Discussions with potential strategic and technology partners to drive product innovation and growth.
Sale of property in Sunnyvale for $11.9 million to fortify financial standing and extend operational runway.
Consideration of strategic alternatives, including equity or debt financing, to maximize stockholder value.
Net loss in FY 2024 of $(20.1) million and decreased revenue compared to FY 2023.
Operating loss in FY 2024 of $(20.4) million and lower gross margin of 54.3%.
Total operating expenses of $32.3 million in FY 2024, impacting financial performance.
Decline in gross margin due to product mix and lower revenue affecting fixed costs.
Reduced cash and cash equivalents from $30.6 million in FY 2023 to $14.4 million in FY 2024.
Insights
Assessing GSI Technology's fiscal year 2024 results, a few key financial metrics stand out. The reported net loss widened to
For investors, the liquidity position is critical. The cash and cash equivalents have roughly halved, from
The technology sector is rapidly evolving and GSI's progress in their compute in memory solutions for high-performance computing and Artificial Intelligence could position them well in a burgeoning market. However, the report indicates a softening demand, as seen in revenue decline year-over-year. This, combined with strategic reviews and potential sale discussions, suggests the company may be at an inflection point. Investors should consider that the company's valuation could be influenced by the outcomes of these strategic reviews, which may either unlock value through partnerships or lead to further uncertainty.
Moreover, GSI's dependence on key customers, such as Nokia, which accounted for a smaller percentage of net revenues year-over-year, could indicate a need for diversifying their customer base to stabilize future revenues. The shift in sales mix toward military/defense and changes in SigmaQuad sales proportions reflect fluctuations in product demand that investors should monitor for implications of market reception and the competitive landscape.
On the technology front, GSI's development of the Gemini-I APU for SAR and Fast Vector Search applications, as well as the ongoing work on Gemini-II, signals dedication to innovation in a niche yet growing segment of the market. As mobile applications and edge processing gain traction, the company's product offerings may align well with future market demands. Nonetheless, investors should be cautious as the market for these advanced technologies is highly competitive and the success of GSI's products will greatly depend on their performance and adoption by strategic partners, which is still in the nascent stage of testing and customer sampling.
Entering into a leaseback arrangement indicates a strategic move to manage capital while not fully relinquishing the asset, which could provide operational leeway. However, the long-term success of these initiatives remains to be seen and investors should weigh the potential benefits against the risks associated with the ongoing strategic shifts and the inherent uncertainty of technology adoption cycles.
SUNNYVALE, Calif., May 02, 2024 (GLOBE NEWSWIRE) -- GSI Technology, Inc. (NASDAQ: GSIT) today reported financial results for its fourth fiscal quarter and fiscal year ended March 31, 2024.
Fourth Quarter and Fiscal Year 2024 Summary Financial Results Table
(in thousands, except per share amounts)
| Three Months Ended | Twelve Months Ended | |||||||||||||
| Mar. 31, 2024 | Dec. 31, 2023 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | ||||||||||
| Net revenues | ||||||||||||||
| Gross margin (%) | ||||||||||||||
| Operating expenses | ||||||||||||||
| Operating loss | ) | ) | ) | ) | ) | |||||||||
| Net loss | ) | ) | ) | ) | ) | |||||||||
| Net loss per share, diluted | ) | ( | ) | ) | ) | ) | ||||||||
Lee-Lean Shu, Chairman and Chief Executive Officer, commented, "In the fourth quarter and subsequently, we achieved significant milestones across our core initiatives. First, we launched two high-capacity, low-power 1U and 2U servers integrated with the High-performance Gemini-I APU. These servers are designed specifically for SAR and Fast Vector Search applications, enabling mobile applications and enterprise-level processing at the edge. Second, notable progress has been made in testing and debugging Gemini-II, which has been mounted on a board for comprehensive performance assessment. We aim to have a second spin in the third quarter of fiscal 2025 and initiate benchmarking shortly after, allowing us to begin preliminary customer sampling. Last, our discussions with potential strategic and technology partners continue to show promise. We remain committed to product innovation and steadfast in forging strategic alliances, both of which position us for growth and success."
Mr. Shu concluded, “In early April, we entered into an agreement to sell our property in Sunnyvale for
Commenting on the outlook for GSI’s first quarter of fiscal 2025, Mr. Shu stated, “Our current expectations for the first quarter of fiscal 2025 are net revenues in a range of
Business Update
In addition, the Company announced that it has initiated a broad strategic review to maximize stockholder value. The review will be administered by a special committee of the board of directors to bring focus on strategic alternatives while the Company’s management focuses on the development of its family of compute in memory solutions for high performance computing and Artificial Intelligence. The Company plans to consider a wide range of options including equity or debt financing, divestiture of assets, technology licensing or other strategic arrangements including the sale of the Company. Over the course of the last eight years, the Company has invested approximately
Fiscal Year 2024 Summary Financials
For the fiscal year ended March 31, 2024, the Company reported a net loss of
Total operating expenses were
The operating loss for fiscal 2024 was
Fourth Quarter Fiscal Year 2024 Summary Financials
The Company reported a net loss of
In the fourth quarter of fiscal 2024, sales to Nokia were
Total operating expenses in the fourth quarter of fiscal 2024 were
Fourth quarter fiscal 2024 operating loss was
Total fourth quarter pre-tax stock-based compensation expense was
At March 31, 2024, the Company had
Conference Call
GSI Technology will review its financial results for the quarter and fiscal year ended March 31, 2024, and discuss its current business outlook during a conference call at 1:30 p.m. Pacific (4:30 p.m. Eastern) today, May 2, 2024. To participate in the call, please dial 1-800-717-1738 in the U.S. or 1-646-307-1865 for international approximately 10 minutes prior to the above start time and provide Conference ID 1133885. The call will also be streamed live via the internet at https://ir.gsitechnology.com/ where the event will be archived.
About GSI Technology
GSI Technology is at the forefront of the AI revolution with our groundbreaking APU technology, designed for unparalleled efficiency in billion-item database searches and high-performance computing. GSI’s innovations, Gemini-I® and Gemini-II®, offer scalable, low-power, high-capacity computing solutions that redefine edge computing capabilities. GSI Technology is not just advancing technology; we're shaping a smarter, faster, and more efficient future.
Founded in 1995 and headquartered in Sunnyvale, California, GSI Technology has 149 employees and over 125 granted patents.
For more information, please visit www.gsitechnology.com.
Forward-Looking Statements
The statements contained in this press release that are not purely historical are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding GSI Technology’s expectations, beliefs, intentions, or strategies regarding the future. All forward-looking statements included in this press release are based upon information available to GSI Technology as of the date hereof, and GSI Technology assumes no obligation to update any such forward-looking statements. Forward-looking statements involve a variety of risks and uncertainties, which could cause actual results to differ materially from those projected. These risks include those associated with the normal quarterly and fiscal year-end closing process, as well as the Company’s initiation of a strategic review. Examples of risks that could affect our current expectations regarding future revenues and gross margins include those associated with fluctuations in GSI Technology’s operating results; GSI Technology’s historical dependence on sales to a limited number of customers and fluctuations in the mix of customers and products in any period; global public health crises that reduce economic activity; the rapidly evolving markets for GSI Technology’s products and uncertainty regarding the development of these markets; the need to develop and introduce new products to offset the historical decline in the average unit selling price of GSI Technology’s products; the challenges of rapid growth followed by periods of contraction; intensive competition; delays or unanticipated costs that may be encountered in the development of new products based on our in-place associative computing technology and the establishment of new markets and customer and partner relationships for the sale of such products; and delays or unexpected challenges related to the establishment of customer relationships and orders for GSI Technology’s radiation-hardened and tolerant semiconductor products. The strategic review is subject to risks related to the process by which GSI Technology evaluates its strategic alternatives, the terms, timing, structure, benefits and costs of any strategic transaction and whether one will be consummated at all and the impact of any strategic transaction on GSI Technology. Many of these risks are currently amplified by and will continue to be amplified by, or in the future may be amplified by, economic and geopolitical conditions, such as rising interest rates, worldwide inflationary pressures, military conflicts, significant fluctuations in energy prices and declines in the global economic environment. Further information regarding these and other risks relating to GSI Technology’s business is contained in the Company’s filings with the Securities and Exchange Commission, including those factors discussed under the caption “Risk Factors” in such filings.
Source: GSI Technology, Inc.
GSI Technology, Inc.
Douglas M. Schirle
Chief Financial Officer
408-331-9802
Hayden IR
Kim Rogers
Managing Director
385-831-7337
Kim@HaydenIR.com
Media Relations
Finn Partners for GSI Technology
Ricca Silverio
(415) 348-2724
gsi@finnpartners.com
| GSI TECHNOLOGY, INC. | ||||||||||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||||||||
| (in thousands, except per share data) | ||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||||
| March 31, | Dec. 31, | March 31, | March 31, | March 31, | ||||||||||||||||||
| 2024 | 2023 | 2023 | 2024 | 2023 | ||||||||||||||||||
| Net revenues | $ | 5,152 | $ | 5,318 | $ | 5,381 | $ | 21,765 | $ | 29,691 | ||||||||||||
| Cost of goods sold | 2,494 | 2,343 | 2,374 | 9,942 | 12,010 | |||||||||||||||||
| Gross profit | 2,658 | 2,975 | 3,007 | 11,823 | 17,681 | |||||||||||||||||
| Operating expenses: | ||||||||||||||||||||||
| Research & development | 4,818 | 6,976 | 5,007 | 21,689 | 23,550 | |||||||||||||||||
| Selling, general and administrative | 2,354 | 2,684 | 1,872 | 10,565 | 9,938 | |||||||||||||||||
| Total operating expenses | 7,172 | 9,660 | 6,879 | 32,254 | 33,488 | |||||||||||||||||
| Operating loss | (4,514 | ) | (6,685 | ) | (3,872 | ) | (20,431 | ) | (15,807 | ) | ||||||||||||
| Interest and other income (expense), net | 108 | 155 | 101 | 414 | 202 | |||||||||||||||||
| Loss before income taxes | (4,406 | ) | (6,530 | ) | (3,771 | ) | (20,017 | ) | (15,605 | ) | ||||||||||||
| Provision (benefit) for income taxes | (85 | ) | 71 | 191 | 70 | 372 | ||||||||||||||||
| Net loss | $ | (4,321 | ) | $ | (6,601 | ) | $ | (3,962 | ) | $ | (20,087 | ) | $ | (15,977 | ) | |||||||
| Net loss per share, basic | $ | (0.17 | ) | $ | (0.26 | ) | $ | (0.16 | ) | $ | (0.80 | ) | $ | (0.65 | ) | |||||||
| Net loss per share, diluted | $ | (0.17 | ) | $ | (0.26 | ) | $ | (0.16 | ) | $ | (0.80 | ) | $ | (0.65 | ) | |||||||
| Weighted-average shares used in | ||||||||||||||||||||||
| computing per share amounts: | ||||||||||||||||||||||
| Basic | 25,297 | 25,256 | 24,685 | 25,144 | 24,595 | |||||||||||||||||
| Diluted | 25,297 | 25,256 | 24,685 | 25,144 | 24,595 | |||||||||||||||||
| Stock-based compensation included in the Condensed Consolidated Statements of Operations: | ||||||||||||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||||
| March 31, | Dec. 31, | March 31, | March 31, | March 31, | ||||||||||||||||||
| 2024 | 2023 | 2023 | 2024 | 2023 | ||||||||||||||||||
| Cost of goods sold | $ | 53 | $ | 51 | $ | 39 | $ | 228 | $ | 202 | ||||||||||||
| Research & development | 331 | 325 | 246 | 1,411 | 1,316 | |||||||||||||||||
| Selling, general and administrative | 309 | 273 | 230 | 1,199 | 951 | |||||||||||||||||
| $ | 693 | $ | 649 | $ | 515 | $ | 2,838 | $ | 2,469 | |||||||||||||
| GSI TECHNOLOGY, INC. | |||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||
| (in thousands) | |||||||
| (Unaudited) | |||||||
| March 31, 2024 | March 31, 2023 | ||||||
| Cash and cash equivalents | $ | 14,429 | $ | 27,212 | |||
| Short-term investments | 0 | 3,363 | |||||
| Accounts receivable | 3,118 | 3,471 | |||||
| Inventory | 4,977 | 6,415 | |||||
| Other current assets | 1,954 | 1,414 | |||||
| Assets held for sale | 5,629 | 0 | |||||
| Net property and equipment | 1,148 | 7,423 | |||||
| Other assets | 11,209 | 10,578 | |||||
| Total assets | $ | 42,464 | $ | 59,876 | |||
| Current liabilities | $ | 5,365 | $ | 7,202 | |||
| Long-term liabilities | 1,129 | 1,302 | |||||
| Stockholders' equity | 35,970 | 51,372 | |||||
| Total liabilities and stockholders' equity | $ | 42,464 | $ | 59,876 | |||
FAQ
What were GSI Technology, Inc.'s net revenues for the fiscal year ended March 31, 2024?
What strategic review did GSI Technology, Inc. initiate?
What were the operating expenses for GSI Technology, Inc. in FY 2024?
What was the net loss reported by GSI Technology, Inc. for the fourth quarter of fiscal year 2024?
What was the gross margin for GSI Technology, Inc. in the fourth quarter of fiscal year 2024?
