Magnachip Reports Results for First Quarter 2023

SEOUL, South Korea, May 3, 2023 — (PRNewswire) — Magnachip Semiconductor Corporation (NYSE: MX) ("Magnachip" or the "Company") today announced financial results for the first quarter 2023.

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.

1 | 2 | 3 | 4 | 5 | 6 Next Page »