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Parade Technologies Reports Second Quarter 2023 Financial Results

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Financial Highlights:

  • Q223 consolidated revenue US$104.18 million, compared with US$216.70 million in the year-ago quarter
  • Q223 consolidated net income US$13.98 million; Basic and Fully diluted after-tax EPS US$0.18 (NT$5.44) and US$0.18 (NT$5.40), respectively

SAN JOSE, Calif.--(BUSINESS WIRE)--Parade Technologies, Ltd. (Taipei Exchange: 4966.TWO), a leading high-speed interface IC supplier, today announced financial results for the second quarter fiscal year 2023 ended June 30, 2023, and provided guidance for the third quarter of fiscal year 2023.

Consolidated revenue was US$104.18 million and consolidated net income was US$13.98 million. Basic and fully diluted after-tax earnings per share (“EPS”) were US$0.18 (NT$5.44) and US$0.18 (NT$5.40), respectively. These results compared to consolidated revenue US$216.70 million and consolidated net income of US$60.94 million, or US$0.76 (NT$22.51) and US$0.75 (NT$22.18) per basic and fully diluted share, in the year-ago quarter.

In US dollars, the second quarter of 2023 consolidated revenue increased 4.19% sequentially and was down 51.93% year-over-year.

The gross profit in the second quarter of 2023 was US$45.80 million, representing an increase of 3.98% from the previous quarter and a decrease of 55.26% compared to the same quarter of last year.

On May 24, 2023, Parade announced the availability of the PS8833 USB4/TBT4/DP 2.1 retimer and PS8836 USB 3.2/DP 2.1 retimer for commercial and consumer PCs, host systems and peripherals. PS8833 features full capabilities of USB4®, DisplayPort 2.1™ and Thunderbolt™ 4.0 with 50% reduction in power consumption. Its pin compatibility with PS8830 USB4/TBT4 retimer currently shipping in customer systems, greatly simplifies OEM design for product longevity. PS8836 offers USB 3.2 Gen 2×2 with DP 2.1 and is pin compatible with PS8833. The PS8833 / PS8836 pin compatible solutions allow OEMs to easily offer a full range of USB4 and USB 3.2 product offerings.

On July 26, 2023, Parade has demonstrated the lowest latencies in the industry with its new PS8936 PCIe/CXL re-timer solution. PS8936 retimer chip developed for PCI Express Rev. 5.0 and Compute Express Link (CXL), supporting sixteen bidirectional lanes. In addition to supporting the 32 Gbps data rate offered by the PCI Express 5.0 specification, it also supports all lower data rates, to provide backward compatibility with earlier PCI Express revisions. The promise of CXL is to enable scalable, high-performance coherent memory. While CXL can rely on the continual advances in PCIe Express to address its ever-increasing bandwidth needs, access time is an equally critical factor for memory performance. As larger CXL architectures are built, they will inevitably encounter situations where signal integrity places limits on both scale and flexibility, and retimers will be needed. With Parade’s patented low-latency retimers, these systems can be built without compromising signal integrity or performance.

Based on current business outlook, Parade is providing the following guidance for the third quarter of fiscal 2023:

  • Revenue: US$107 ~119 Million
  • Gross Margin: 43% ~47%
  • Operating Expense: US$30 ~33 Million

The financial figures detailed above for the second quarter of 2023 have been audited by independent accountants.

About Parade Technologies, Ltd.

Parade Technologies, Ltd. is a leading supplier of mixed-signal ICs for a variety of popular display and high-speed interface standards used in computers, consumer electronics and display panels. The fabless semiconductor company was founded in 2005 and publicly listed on Taipei Exchange (“TPEx”) in 2011 (stock code: 4966). Parade’s portfolio of IC products serves the growing demand for HDMI™, DisplayPort™, SATA, and USB ICs for display, storage and interface applications.

In addition to being a technology innovator, Parade is an active participant and leader in industry standards-setting organizations. Parade Technologies, Inc., a wholly owned US-based subsidiary of Parade Technologies, Ltd., is a member of VESA (Video Electronics Standard Association). Parade Technologies, Inc. has made key contributions to the development of VESA’s DisplayPort™ digital video interface standard.

Parade leverages its close relationships with market leading Tier-1 OEMs to develop ICs that provide unique system capabilities. Many of the company’s devices integrate proprietary technologies that offer superior system signal integrity, advanced system integration and enhanced power efficiency. As a result of the company’s “standards-plus” design philosophy, Parade ICs have been designed into products offered by nearly every leading computer and display vendor worldwide.

Parade Technologies, Ltd. and Subsidiaries.

The reader is advised that these consolidated financial statements have been prepared originally in NT$ and conformed with the adoption of IFRSs. In the event of any differences between NT$ and US$ version, the NT$ version shall prevail.

CONSOLIDATED INCOME STATEMENTS

USD in Thousands

 

NTD in Thousands

Sequential Quarter

 

Three Months ended

 

Six Months ended

 

Sequential Quarter

 

Three Months ended

 

Six Months ended

Jun 30,

 

Mar 31,

 

Jun 30,

 

Jun 30,

 

Jun 30,

 

Jun 30,

 

Jun 30,

 

Mar 31,

 

Jun 30,

 

Jun 30,

 

Jun 30,

 

Jun 30,

2023

 

2023

 

2023

 

2022

 

2023

 

2022

 

2023

 

2023

 

2023

 

2022

 

2023

 

2022
 
Revenue

 

104,178

 

99,990

 

104,178

 

216,699

 

204,168

 

427,422

 

3,199,298

 

3,039,712

 

3,199,298

 

6,383,951

 

6,239,010

 

12,282,094
Cost of goods sold

 

58,380

 

55,947

 

58,380

 

114,340

 

114,327

 

224,288

 

1,792,845

 

1,700,797

 

1,792,845

 

3,368,457

 

3,493,642

 

6,445,908
Gross profit

 

45,798

 

44,043

 

45,798

 

102,359

 

89,841

 

203,134

 

1,406,453

 

1,338,915

 

1,406,453

 

3,015,494

 

2,745,368

 

5,836,186
Research & development expenses

 

20,293

 

19,892

 

20,293

 

21,483

 

40,185

 

42,709

 

623,198

 

604,717

 

623,198

 

632,873

 

1,227,915

 

1,226,997
Sales & marketing expenses

 

7,188

 

7,198

 

7,188

 

7,907

 

14,386

 

16,121

 

220,732

 

218,822

 

220,732

 

232,925

 

439,554

 

462,836
General & administrative expenses

 

4,888

 

4,993

 

4,888

 

6,549

 

9,881

 

12,998

 

150,109

 

151,797

 

150,109

 

192,942

 

301,906

 

373,450
Expected credit loss

 

-

 

84

 

-

 

-

 

84

 

-

 

-

 

2,549

 

-

 

-

 

2,549

 

-
Total operating expenses

 

32,369

 

32,167

 

32,369

 

35,939

 

64,536

 

71,828

 

994,039

 

977,885

 

994,039

 

1,058,740

 

1,971,924

 

2,063,283
Operating income

 

13,429

 

11,876

 

13,429

 

66,420

 

25,305

 

131,306

 

412,414

 

361,030

 

412,414

 

1,956,754

 

773,444

 

3,772,903
Non-operating income and (expenses)

 

2,055

 

1,268

 

2,055

 

566

 

3,323

 

536

 

63,081

 

38,560

 

63,081

 

16,662

 

101,641

 

15,837
Income before income taxes

 

15,484

 

13,144

 

15,484

 

66,986

 

28,628

 

131,842

 

475,495

 

399,590

 

475,495

 

1,973,416

 

875,085

 

3,788,740
Income tax expense

 

1,505

 

1,523

 

1,505

 

6,049

 

3,028

 

11,718

 

46,226

 

46,299

 

46,226

 

178,193

 

92,525

 

336,882
Net income

 

13,979

 

11,621

 

13,979

 

60,937

 

25,600

 

120,124

 

429,269

 

353,291

 

429,269

 

1,795,223

 

782,560

 

3,451,858
EPS - Basic (In Dollar)

$

0.18

$

0.15

$

0.18

$

0.76

$

0.33

$

1.51

$

5.44

$

4.51

$

5.44

$

22.51

$

9.94

$

43.42
Shares used in computing EPS-Basic (In thousands)

 

78,947

 

78,373

 

78,947

 

79,766

 

78,692

 

79,496

 

78,947

 

78,373

 

78,947

 

79,766

 

78,692

 

79,496
EPS - Diluted (In Dollar)

$

0.18

$

0.15

$

0.18

$

0.75

$

0.32

$

1.48

$

5.40

$

4.46

$

5.40

$

22.18

$

9.85

$

42.67
Shares used in computing EPS-Diluted (In thousands)

 

79,545

 

79,207

 

79,545

 

80,951

 

79,413

 

80,905

 

79,545

 

79,207

 

79,545

 

80,951

 

79,413

 

80,905
CONSOLIDATED BALANCE SHEETS
As of June 30, 2023 and 2022		 USD in Thousands NTD in Thousands
Jun 30, Jun 30, Jun 30, Jun 30,

2023

2022

2023

2022
Current assets
Cash & cash equivalents

225,120

 

408,717

 

7,010,227

 

12,147,059

 
Accounts receivable, net

54,721

 

71,597

 

1,704,022

 

2,127,869

 
Inventories, net

114,368

 

107,911

 

3,561,433

 

3,207,122

 
Other current assets

32,666

 

25,492

 

1,017,219

 

757,629

 
Total current assets

426,875

 

613,717

 

13,292,901

 

18,239,679

 
Non-current assets
Property, plant and equipment, net

14,970

 

17,920

 

466,159

 

532,593

 
Right-of-use assets

5,083

 

6,759

 

158,295

 

200,863

 
Intangible assets

101,772

 

106,129

 

3,169,177

 

3,154,145

 
Deferred income tax assets

11,143

 

10,232

 

346,988

 

304,090

 
Other non-current assets

150,473

 

78,140

 

4,685,730

 

2,322,312

 
Total non-current assets

283,441

 

219,180

 

8,826,349

 

6,514,003

 
Total Assets

710,316

 

832,897

 

22,119,250

 

24,753,682

 
 
Current Liabilities
Accounts payable

29,194

 

56,079

 

909,092

 

1,666,672

 
Other payables

54,820

 

100,695

 

1,687,909

 

2,892,562

 
Current income tax liabilities

9,528

 

30,317

 

296,692

 

901,030

 
Lease liabilities - current

2,960

 

3,037

 

92,194

 

90,253

 
Other current liabilities

6,490

 

13,823

 

202,110

 

410,818

 
Total current liabilities

102,992

 

203,951

 

3,187,997

 

5,961,335

 
Non-current Liabilities
Lease liabilities - non-current

2,123

 

3,722

 

66,101

 

110,610

 
Total non-current liabilities

2,123

 

3,722

 

66,101

 

110,610

 
Equity
Ordinary shares

26,735

 

26,740

 

811,747

 

811,895

 
Capital reserves

134,946

 

138,074

 

4,212,672

 

4,188,380

 
Retained earnings

498,502

 

500,731

 

14,740,781

 

14,948,952

 
Other equity

(10,321

)

(18,513

)

493,401

 

(661,362

)
Treasury shares

(44,661

)

(21,808

)

(1,393,449

)

(606,128

)
Total equity

605,201

 

625,224

 

18,865,152

 

18,681,737

 
Total liabilities and equity

710,316

 

832,897

 

22,119,250

 

24,753,682

 
CONSOLIDATED STATEMENTS OF CASH FLOWS
For six months ended June 30, 2023 and 2022		 USD in Thousands NTD in Thousands
Jun 30, Jun 30, Jun 30, Jun 30,

2023

2022

2023

2022
Cash flows from operating activities
Income before income tax for the period

28,628

 

131,842

 

875,085

 

3,788,740

 
Depreciation and amortization (including the right-of-use assets)

11,132

 

11,081

 

340,100

 

318,238

 
Expected credit loss

84

 

-

 

2,549

 

-

 
Loss on disposal of equipment

-

 

1

 

-

 

34

 
Loss on disposal of intangible assets

125

 

-

 

3,814

 

-

 
Share-based compensation cost

17,735

 

16,451

 

537,517

 

479,230

 
Interest income

(2,925

)

(158

)

(89,352

)

(4,627

)
Income and expenses having no effect on cash flows

26,151

 

27,375

 

794,628

 

792,875

 
Accounts receivable

(20,098

)

(21,214

)

(625,845

)

(630,493

)
Inventories

31,124

 

(32,133

)

969,215

 

(954,979

)
Other current assets

(27,673

)

(31,800

)

(737,173

)

(893,882

)
Net changes in assets relating to operating activities

(16,647

)

(85,147

)

(393,803

)

(2,479,354

)
Accounts payable

16,191

 

15,233

 

504,193

 

452,730

 
Other payables

(9,303

)

(1,814

)

(289,726

)

(53,915

)
Other current liabilities

(6,983

)

3,779

 

(217,466

)

112,320

 
Net changes in liabilities relating to operating activities

(95

)

17,198

 

(2,999

)

511,135

 
Cash inflow generated from operations

38,037

 

91,268

 

1,272,911

 

2,613,396

 
Interest received

2,925

 

158

 

89,352

 

4,627

 
Income taxes paid

(6,247

)

(816

)

(190,854

)

(23,433

)
Income taxes received

-

 

19

 

-

 

554

 
Net cash provided by operating activities

34,715

 

90,629

 

1,171,409

 

2,595,144

 
Cash flows from investing activities
Acquisition of equipment

(2,812

)

(3,854

)

(85,894

)

(110,678

)
Acquisition of intangible assets

(170

)

(34

)

(5,181

)

(977

)
Decrease in refundable deposits

6,821

 

74

 

212,389

 

2,193

 
Increase in other prepayments

(6,505

)

(4,552

)

(198,738

)

(130,729

)
Net cash flows used in investing activities

(2,666

)

(8,366

)

(77,424

)

(240,191

)
Cash flows from financing activities
Proceeds from exercise of employee stock options

-

 

2,376

 

-

 

68,228

 
Repayment of the principal portion of lease liabilities

(1,786

)

(1,931

)

(54,554

)

(55,475

)
Treasury shares reissued to employees

25,424

 

34,533

 

760,161

 

959,141

 
Distribution of cash dividends

(60,062

)

(40,752

)

(1,724,498

)

(1,147,980

)
Cash dividend regain from canceled share-based compensation

73

 

52

 

2,184

 

1,517

 
Net cash flows used in financing activities

(36,351

)

(5,722

)

(1,016,707

)

(174,569

)
Effect of exchange rate changes

2,285

 

(257

)

(42,435

)

764,932

 
Net (decrease) increase in cash and cash equivalents

(2,017

)

76,284

 

34,843

 

2,945,316

 
Cash and cash equivalents at beginning of period

227,137

 

332,433

 

6,975,384

 

9,201,743

 
Cash and cash equivalents at end of period

225,120

 

408,717

 

7,010,227

 

12,147,059

 

 

Contacts

Parade Technologies

Yo-Ming Chang, +886-2-2627-9109

[email protected]

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