O2Micro Reports Third Quarter 2021 Financial Results

Rhea-AI Summary

O2Micro reported Q3 2021 revenue of $27.3 million, reflecting a 22.6% year-over-year increase. GAAP net income rose to $3.7 million or $0.12 per fully diluted ADS, up from $2.9 million or $0.10 in Q3 2020. The company anticipates Q4 revenue between $25.5 million and $26.5 million. Gross margins improved to 52.0%, while operating expenses were $10.6 million, leading to an operating margin of 13.3%.

O2Micro ended Q3 with $50.7 million in cash and short-term investments.

Positive

• Revenue up 22.6% year-over-year to $27.3 million.
• GAAP net income increased to $3.7 million (or $0.12 per fully diluted ADS).
• Gross margin improved to 52.0%.
• Expecting Q4 revenue of $25.5 to $26.5 million.

Negative

• GAAP operating expenses rose to $10.6 million from $8.4 million in Q3 2020.
• Operating margin declined to 13.3% from 14.0% in the previous year.

GEORGE TOWN, Grand Cayman, Oct. 29, 2021 (GLOBE NEWSWIRE) --

Operational Highlights:

• 2021 Q3 revenue was $27.3 million.
  
  
• Revenue increased 22.6% compared to the same quarter in 2020.
  
  
• GAAP net income was $0.12 per fully diluted ADS, up from $0.10 per fully diluted ADS, for the same quarter a year ago.
  
  
• O2Micro expects the fourth quarter 2021 revenue to be in the range of $25.5 million to $26.5 million.

O2Micro^® International Limited (NASDAQ: OIIM)(“O2Micro), a global leader in the design, development and marketing of high-performance integrated circuits and solutions, reported its financial results today for the third quarter ending September 30, 2021.

Financial Highlights for the Third Quarter ending September 30, 2021:
O2Micro reported the third quarter 2021 revenue of $27.3 million within guidance provided on July 30, 2021. Revenue was up 22.6% from the same quarter in the previous year. The gross margin in the third quarter of 2021 was 52.0%, which was up from 51.8% in the same quarter of 2020. During the third quarter of 2021, the Company recorded total GAAP operating expenses of $10.6 million and was up from $8.4 million in the third quarter of 2020. The GAAP operating margins for the third quarter of 2021 was 13.3% compared to 14.0% in the third quarter of 2020. The Company reported 2021 Q3 GAAP net income of $3.7 million, or $0.12 per fully diluted ADS, compared to a GAAP net income of $2.9 million or $0.10 per fully diluted ADS in the comparable quarter of 2020.

Supplementary Data:
The Company ended the third quarter of 2021 with $50.7 million in unrestricted cash and short-term investments or $1.78 per outstanding ADS, along with 344 employees worldwide of which 201 are engineers.

Management Commentary:
“O2Micro’s escalating growth continued through the third quarter with revenue increasing 4.1% from the prior quarter and 22.6% over the same quarter in 2020. Our battery business grew strongly despite the dynamic market and supply chain situation. Not only have the lithium-ion battery dominated the power tool market but the high-end tools, which is our focus, outgrows the other sectors. Our Intelligent Lighting group business continues to expand with recent design wins as the high-end TV market takes market share,” said Sterling Du, O2Micro’s Chairman and CEO. “These factors, along with continued investment to the RD and expanding packing testing capability, are leading O2Micro into sustainable long-term profitability.”

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME follows conference call information below

Conference Call:
O2Micro will hold its third quarter conference call on October 29, 2021, at 6:00AM. Pacific, 9:00AM Eastern. You may participate using the following dial-in information.

Conference Code: 6414359

Participants, Int'l Toll: 800-767-8973
Participants, US/CAN: 800-767-8973

The Call-in Audio Replay will be available following the call at 12:00PM Eastern Time (US & Canada) for the next 14 days.   https://events.globalmeet.com/Public/WebRegistration/ZW5jPXNhQWNoekF6VklkSzg1T0VNUFBpN0lqN084dUh6T25wNFIzcUF2RFcrcSt3WU5HZTN0M3lzQ1dnd1lMOXlFSlRFNU00a2YvZGJzQWxCVjZTY0pUbkRBPT0=

An online replay will also be available at https://ir.o2micro.com following the conference.

About O2Micro:
Founded in April 1995, O2Micro develops and markets innovative power management components for the Computer, Consumer, Industrial, and Automotive markets. Products include Backlighting, and Battery Power Management. The company maintains offices worldwide. Additional company and product information can be found on the company website at www.o2Micro.com.

O2Micro, the O2Micro logo, and combinations thereof are registered trademarks of O2Micro. All other trademarks or registered trademarks are the property of their respective owners.

Statements made in this release that are not historical, including statements regarding O2Micro or its management's intentions, hopes, beliefs, expectations, representations, projections, plans or predictions of the future, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other Federal Securities Laws. Such statements involve risks, speculation and uncertainties that may cause actual results to differ materially from those set forth in these statements or from management's current views and expectations. Risks and uncertainties in this release may include, without limitation, any one or combination of the following: the effect of competitive and economic factors; real property value fluctuations and market demand; legal changes in any relevant rules and regulations pertaining to O2Micro's business; changes in technology and industry standards, and O2Micro's reaction to those factors; consumer and business buying decisions with respect to our customers' products incorporating O2Micro's products; continued competitive pressures in the marketplace; the ability of O2Micro to deliver to the marketplace, and stimulate customer demand therein, for new products and technological innovations on a timely basis; the effect that product introductions and transitions, changes in product pricing or mix, and/or increases in component costs could have on O2Micro's gross margins; the inventory risk associated with O2Micro's need to order, or commit to order, product components and product capacity in advance of forecast customer orders; the continued availability of acceptable terms of certain components and services essential to O2Micro's business which are currently obtained by the Company from sole or limited sources; the effect that O2Micro's dependency on manufacturing and logistics services provided by third parties may have on the quality, quantity, availability or cost of products manufactured or services rendered; risks associated with O2Micro's international operations; the potential impact of a finding that O2Micro has infringed on the intellectual property rights of others, or that any third party may have infringed on O2Micro's intellectual property that may negatively affect O2Micro's business; O2Micro's legal classifications with governmental and regulatory agencies; O2Micro's dependency on the performance of distributors, carriers, independent sales representatives, and other resellers of O2Micro's products; the effect that product and service quality problems could have on O2Micro's sales ability and operating profits; the ability of O2Micro to deliver its products in a timely fashion to its customers, and the possible negative ramifications if such is not possible; the continued service and availability of key executives and employees; war, terrorism, public health issues, natural disasters, and other circumstances that could disrupt supply, delivery, or demand of products; and unfavorable results of other legal proceedings. Actual results may differ materially due to numerous risk factors. Such risk factors are more fully enumerated in O2Micro's 20-F Annual Filings, Annual Report(s), 6-K's, the Form F-1 filed in connection with the Company's initial public offering in August 2000, information posted on our website at www.o2micro.com, and other documents filed with the SEC, NASDAQ or any other public agency from time to time. The statements herein are based on dated information on the dates mentioned herein, which is subject to change. O2Micro assumes no obligation to update or revise the information provided on today, or any other forward-looking information, whether as a result of new information, future events or any other information that may arise. This information only speaks to the respective dates mentioned in said information.

O2Micro
Daniel Meyberg
Investor Relations

Gregory Communications FCA
Joe Hassett

O₂MICRO INTERNATIONAL LIMITED AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (UNAUDITED)
(In Thousand U.S. Dollars, Except Per Share Amounts)

	Three Months Ended								Nine Months Ended
	September 30,								September 30,
		2021				2020				2021				2020
OPERATING REVENUES	$	27,270			$	22,235			$	76,711			$	55,100
COST OF REVENUES		13,096				10,713				37,060				26,634
GROSS PROFIT		14,174				11,522				39,651				28,466
OPERATING EXPENSES
Research and development (1)		5,126				4,072				14,433				13,238
Selling, general and administrative (1)		5,434				4,333				15,955				13,357
Total Operating Expenses		10,560				8,405				30,388				26,595
INCOME FROM OPERATIONS		3,614				3,117				9,263				1,871
NON-OPERATING INCOME
Interest income		48				92				186				436
Net loss recognized on long-term investments		-				(171	)			-				(212	)
Foreign exchange gain (loss) – net		57				(124	)			29				(184	)
Government grants		136				67				274				151
Other – net		101				204				344				430
Total Non-operating Income		342				68				833				621
INCOME BEFORE INCOME TAX		3,956				3,185				10,096				2,492
INCOME TAX EXPENSE		279				255				776				722
NET INCOME		3,677				2,930				9,320				1,770
OTHER COMPREHENSIVE (LOSS) INCOME
Foreign currency translation adjustments		(148	)			576				36				494
Unrealized pension gain		-				-				1				1
Total Other Comprehensive (Loss) Income		(148	)			576				37				495
COMPREHENSIVE INCOME	$	3,529			$	3,506			$	9,357			$	2,265
EARNINGS PER ADS
Basic	$	0.13			$	0.11			$	0.33			$	0.07
Diluted	$	0.12			$	0.10			$	0.30			$	0.06
ADS UNITS USED IN EARNINGS PER ADS CALCULATION:
Basic (in thousands)		28,478				27,040				28,323				26,917
Diluted (in thousands)		31,017				28,896				31,221				28,078
(1) INCLUDES STOCK-BASED COMPENSATION CHARGE AS FOLLOWS:
Research and development	$	98			$	66			$	294			$	213
Selling, general and administrative	$	345			$	260			$	996			$	837

O₂MICRO INTERNATIONAL LIMITED AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
(In Thousand U.S. Dollars, Except Share Amounts)

	September 30,				December 31,
		2021				2020
ASSETS	(Unaudited)				(Audited)
CURRENT ASSETS
Cash and cash equivalents	$	22,073			$	18,752
Restricted cash		38				37
Short-term investments		28,661				29,054
Accounts receivable – net		16,693				16,430
Inventories		18,001				12,588
Prepaid expenses and other current assets		3,423				2,548
Total Current Assets		88,889				79,409
LONG-TERM INVESTMENTS		992				992
PROPERTY AND EQUIPMENT – NET		22,407				17,266
OTHER ASSETS		3,858				4,369
TOTAL ASSETS	$	116,146			$	102,036
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
Notes and accounts payable	$	10,295			$	7,995
Income tax payable		376				272
Lease liabilities		977				865
Accrued expenses and other current liabilities		5,355				5,934
Total Current Liabilities		17,003				15,066
OTHER LONG-TERM LIABILITIES
Accrued pension liabilities		144				177
Deferred income tax liabilities		690				545
Lease liabilities		1,965				2,091
Other liabilities		69				68
Total Other Long-Term Liabilities		2,868				2,881
Total Liabilities		19,871				17,947
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ EQUITY
Preference shares at $0.00002 par value per share
Authorized – 250,000,000 shares		-				-
Ordinary shares at $0.00002 par value per share
Authorized – 4,750,000,000 shares
Issued – 1,669,036,600 shares as of September 30, 2021 and December 31, 2020 Outstanding – 1,425,507,250 and 1,361,886,000 shares as of September 30, 2021 and December 31, 2020, respectively		33				33
Additional paid-in capital		142,974				143,422
Accumulated deficits		(37,951	)			(46,744	)
Accumulated other comprehensive income		5,777				5,740
Treasury stock – 243,529,350 and 307,150,600 shares as of September 30, 2021 and         December 31, 2020, respectively		(14,558	)			(18,362	)
Total Shareholders’ Equity		96,275				84,089
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	116,146			$	102,036

FAQ

What were O2Micro's Q3 2021 revenue and net income results?

O2Micro reported Q3 2021 revenue of $27.3 million and GAAP net income of $3.7 million, or $0.12 per fully diluted ADS.

How does O2Micro's Q3 2021 performance compare to Q3 2020?

Revenue increased by 22.6% year-over-year, while GAAP net income rose from $2.9 million ($0.10 per fully diluted ADS) in Q3 2020 to $3.7 million ($0.12 per fully diluted ADS) in Q3 2021.

What is O2Micro's revenue guidance for Q4 2021?

O2Micro expects Q4 2021 revenue to be in the range of $25.5 million to $26.5 million.

What were the operating margins for O2Micro in Q3 2021?

O2Micro's operating margins for Q3 2021 were 13.3%, down from 14.0% in Q3 2020.