Himax Technologies (NASDAQ: HIMX) reported Q1 EPS of $0.022, $0.01 better than the analyst estimate of $0.01. Revenue for the quarter came in at $184.6 million versus the consensus estimate of $186.63 million.

• Q1 revenue increased 5.5% sequentially to $184.6M, at the midrange of the guidance of an increase between 1% to 10%
• Product sales: large driver ICs, 33.2% of revenue, up 6.0% QoQ; small and medium-sized driver ICs, 47.4% of revenue, up 7.9% QoQ; non-driver products, 19.4% of revenue, down 0.6% QoQ
• Q1 IFRS gross margin was 22.7%, up 210 bps sequentially, exceeding the guidance of an increase of 1% to 2% compared to the fourth quarter’s 20.6%
• Q1 IFRS profit was $3.3M, or 1.9 cents per diluted ADS, exceeding the guidance of a profit of around -0.5 to 1.8 cents per diluted ADS. It is better than profit of $1.0M, or 0.6 cents per diluted ADS in Q4 2019
• Q1 non-IFRS profit was $3.8M, or 2.2 cents per diluted ADS, exceeding the guidance of a profit of around -0.2 to 2.1 cents per diluted ADS. It is better than profit of $1.5M, or 0.9 cents per diluted ADS in Q4 2019
• Second half business visibility is limited as COVID-19 has created a profound impact to global consumption and the economy overall. Q2 business is affected by the pandemic, especially for TV and automotive related product. Company sees home working and online education have driven a surge in its NB, monitor and tablet related products and strong momentum in smartphone TDDI business on the backdrop of a sluggish global smartphone
• TDDI is quickly becoming mainstream for tablet with consumer demand accelerating. Himax is the dominate TDDI supplier to global Tier-1 Android tablet makers, making Himax the market leader in the emerging trend. While still a new product, tablet TDDI already represents around 5% of Himax’s overall revenues and the Company expects the business to deliver strong growth in Q2 and throughout 2020
• Expects WLO shipment to decline significantly in Q2 sequentially due to COVID-19 outbreak. Demand remain uncertain for a while even after factory reopens
• On a macro perspective, Company is well-positioned to benefit from increased demand coming out of the major Chinese panel customers expanding market share in the LCD market thanks to Korea panel makers’ accelerated exit from the industry in 2020
• Company is collaborating with an industry leading 3D ToF camera vendor to develop a new and advanced ToF solution, targeting Android smartphones. Providing WLO spot projector for their reference design which will be ready for leading Android smartphone makers’ evaluation in Q2. Company also has on-going active design-in activities providing optical component or projector to its tier-1 smartphone OEM customers. 3D sensing remains one of the main growth drivers
• Company is making great progress and remain committed to ongoing R&D projects for next-generation products in ultralow power smart image sensing, auto TDDI, 3D sensing and AMOLED

“Our reported first quarter results met guidance for revenue and exceeded guidance for gross margin and EPS, consistent with our preliminary results reported on April 3, 2020. During the quarter we worked closely with both our customers and suppliers, taking action to adapt to the new environment. As a result, despite supply chain disruptions from China lockdowns, we delivered decent results in the first quarter,” said Mr. Jordan Wu, President and Chief Executive Officer of Himax.

“Looking forward, China has recently reopened, and other countries are seemingly moving in the same direction following a long period of lockdown. At this point, our visibility into the second half of the year is rather limited as the pandemic has created a profound impact on the global consumption and the economy overall. Despite the coronavirus, we are still making great progress on our business, and remain committed to, ongoing R&D projects. We have taken proactive steps to strategically manag

GUIDANCE:

Himax Technologies sees Q2 2020 EPS of ($0.013)-($0.003), versus the consensus of $0.03.

For earnings history and earnings-related data on Himax Technologies (HIMX) click here.