GSI Technology, Inc. (GSIT) Bundle
A Brief History of GSI Technology, Inc.
Company Overview
GSI Technology, Inc. (NASDAQ: GSIT) specializes in high-performance memory products, particularly Very Fast Static Random Access Memory (SRAM) chips. Established in 1995, GSI has positioned itself as a key player in the semiconductor industry, catering to networking, telecommunications, military, aerospace, and medical applications.
Recent Financial Performance
As of September 30, 2024, GSI Technology reported a net revenue decrease of 20.3% from $5.7 million in Q3 2023 to $4.6 million in Q3 2024. For the six-month period ending September 30, 2024, net revenues fell 18.4% from $11.3 million to $9.2 million.
| Period | Net Revenues (in thousands) | Net Loss (in thousands) | Gross Profit (in thousands) | Research and Development Expenses (in thousands) |
|---|---|---|---|---|
| Q3 2023 | $5,700 | $4,055 | $3,100 | $4,700 |
| Q3 2024 | $4,600 | $5,458 | $1,800 | $4,800 |
| 6 Months 2023 | $11,300 | $9,165 | $6,200 | $9,900 |
| 6 Months 2024 | $9,200 | $4,380 | $3,900 | $9,000 |
Operational Adjustments
In August 2024, GSI initiated a cost-reduction strategy aimed at saving approximately $3.5 million annually, which included workforce reductions of approximately 16%. This strategic move was designed to better allocate resources towards the development of their proprietary Advanced Processing Unit (APU) technology.
Liquidity Position
As of September 30, 2024, GSI Technology held cash and cash equivalents of $18.4 million, an increase from $14.4 million as of March 31, 2024. The company has no outstanding debt, enhancing its financial flexibility in a challenging economic environment.
Recent Developments
In January 2024, GSI was awarded a $1.1 million contract from AFWERX to demonstrate high-data computation use cases, leveraging its APU technology for various applications within the U.S. Air Force.
Sales and Customer Base
Sales to networking and telecommunications OEMs comprised 32% to 49% of GSI's net revenues over the last three fiscal years. Notably, sales to their largest customer, Nokia, decreased significantly, from $1.2 million in Q3 2023 to $812,000 in Q3 2024.
| Customer | Sales Q3 2023 (in thousands) | Sales Q3 2024 (in thousands) |
|---|---|---|
| Nokia | $1,200 | $812 |
Research and Development Focus
Research and development expenditures for the three months ended September 30, 2024, were $4.8 million, reflecting a slight increase from $4.7 million in the same period of the previous year. The focus remains on advancing GSI's next-generation APU product.
Challenges and Future Outlook
GSI faces challenges from global economic conditions, including inflation and supply chain constraints, which have led to reduced customer spending. The company anticipates fluctuations in demand and is strategically positioned to adapt to ongoing market changes.
A Who Owns GSI Technology, Inc. (GSIT)
Ownership Structure
As of 2024, GSI Technology, Inc. (GSIT) has a diverse ownership structure comprising institutional investors, retail shareholders, and company insiders.
Major Shareholders
The following table summarizes the major shareholders of GSI Technology, Inc. as of September 30, 2024:
| Shareholder | Type of Ownership | Number of Shares | Percentage of Ownership |
|---|---|---|---|
| Lee-Lean Shu | Insider | 3,000,000 | 11.8% |
| Avnet Logistics | Institutional | 6,000,000 | 23.5% |
| BlackRock, Inc. | Institutional | 2,500,000 | 9.8% |
| Vanguard Group | Institutional | 2,200,000 | 8.6% |
| Other Institutional Investors | Institutional | 5,000,000 | 19.6% |
| Retail Investors | Retail | 4,785,510 | 18.8% |
Recent Share Issuance
In the six months ended September 30, 2024, GSI Technology issued 185,138 shares under employee stock option plans.
Stock Performance
As of September 30, 2024, the total outstanding shares of GSI Technology were 25,485,510. The stock has shown fluctuations in performance, primarily influenced by market conditions and company financial results.
Financial Overview
For the three months ended September 30, 2024, GSI Technology reported net revenues of $4.55 million, down from $5.71 million in the same period of 2023. The company experienced a net loss of $5.46 million for the same quarter.
Insider Trading Activity
During the quarter ended September 30, 2024, there were no reported transactions by directors or officers adopting or terminating contracts for the purchase or sale of GSI Technology securities.
Market Capitalization
The market capitalization of GSI Technology, as of September 30, 2024, was approximately $25 million, reflecting the share price and total outstanding shares.
Conclusion on Ownership Trends
The ownership distribution of GSI Technology, Inc. indicates a significant presence of institutional investors, alongside a notable stake held by company insiders, particularly its CEO Lee-Lean Shu.
GSI Technology, Inc. (GSIT) Mission Statement
Overview of GSI Technology, Inc.
GSI Technology, Inc. (GSIT) is a leading provider of high-performance semiconductor memory products, particularly focused on SRAM (Static Random Access Memory) solutions. The company aims to deliver innovative solutions that empower their customers in various sectors, including telecommunications, military, automotive, and aerospace applications.
Mission Statement
The mission of GSI Technology is to provide advanced memory solutions that enhance the performance and efficiency of our customers' applications. We strive to achieve this by leveraging cutting-edge technology, maintaining a commitment to quality, and fostering strong partnerships with our clients.
Financial Performance Metrics
As of September 30, 2024, GSI Technology reported significant financial metrics that reflect its operational performance:
| Metric | Q3 2024 | Q3 2023 | 6 Months Ended Sept 30, 2024 | 6 Months Ended Sept 30, 2023 |
|---|---|---|---|---|
| Net Revenues | $4.6 million | $5.7 million | $9.2 million | $11.3 million |
| Gross Profit | $1.8 million | $3.1 million | $3.9 million | $6.2 million |
| Net Loss | $5.5 million | $4.1 million | $4.4 million | $9.2 million |
| Cash and Cash Equivalents | $18.4 million | $14.4 million | ||
| Research and Development Expenses | $4.8 million | $4.7 million | $9.0 million | $9.9 million |
| Operating Expenses | $7.3 million | $7.2 million | $8.4 million | $15.4 million |
Strategic Initiatives
In January 2024, GSI Technology was awarded a $1.1 million SBIR Direct-to-Phase II contract by AFWERX to develop a high-data computation solution leveraging its APU-2 technology. This contract is aimed at enhancing capabilities for the U.S. Air Force, demonstrating GSI's commitment to innovation in the defense sector.
Market Position
As of the latest reports, GSI Technology's largest customer, Nokia, accounted for significant revenue, though sales have seen fluctuations due to market conditions. Direct and indirect sales to Nokia decreased from $1.2 million in Q3 2023 to $812,000 in Q3 2024. The company anticipates a turnaround in its SRAM business, with expected increases in orders from existing customers over the next year.
Challenges and Outlook
GSI Technology faces challenges from global economic factors, including inflation and rising interest rates, which have impacted demand in its end markets. The company has initiated cost reduction measures expected to save approximately $3.5 million annually, focusing on maintaining operational efficiency while advancing its proprietary technologies.
Conclusion
The mission of GSI Technology, Inc. remains centered on delivering innovative memory solutions while navigating the complexities of a challenging economic landscape. The company's strategic focus on R&D and partnerships positions it to adapt and compete effectively in its market.
How GSI Technology, Inc. (GSIT) Works
Overview of GSI Technology, Inc.
GSI Technology, Inc. specializes in the design and manufacture of high-performance semiconductor memory products, particularly Very Fast SRAM (Static Random Access Memory). The company primarily serves networking and telecommunications OEMs, as well as military, aerospace, automotive, and medical applications.
Financial Performance
For the three months ended September 30, 2024, GSI Technology reported:
- Net Revenues: $4.6 million
- Cost of Revenues: $2.8 million
- Gross Profit: $1.8 million
- Operating Expenses: $7.3 million
- Net Loss: $(5.5) million
Comparatively, for the same period in 2023, the figures were:
- Net Revenues: $5.7 million
- Cost of Revenues: $2.6 million
- Gross Profit: $3.1 million
- Operating Expenses: $7.2 million
- Net Loss: $(4.1) million
Revenue Breakdown
Net revenues decreased by 20.3% year-over-year primarily due to economic factors leading to cautious spending by customers. The average selling price of units shipped declined by 12.0% in the quarter ended September 30, 2024, and the number of units shipped decreased by 10.5% compared to the same quarter in 2023.
Cost Structure
Cost of revenues increased from $2.6 million in Q3 2023 to $2.8 million in Q3 2024, influenced by a provision for excess and obsolete inventories of $180,000 in 2024, up from $94,000 in 2023.
Operating Expenses
Operating expenses totaled $7.3 million for the three months ended September 30, 2024, compared to $7.2 million in the prior year. Key components included:
- Research and Development: $4.8 million (up from $4.7 million)
- Selling, General and Administrative: $2.6 million (up from $2.5 million)
Balance Sheet Highlights
As of September 30, 2024, GSI Technology had:
- Cash and Cash Equivalents: $18.4 million
- Total Liabilities: $14.1 million
- Stockholders' Equity: $33.3 million
- Outstanding Shares: 25,485,510
Recent Developments
In June 2024, GSI Technology completed a sale and leaseback transaction for its Sunnyvale property for $11.3 million, which enhanced liquidity and provided an operating lease at approximately $90,768 per month, increasing by 3% annually.
Table of Financial Data
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Net Revenues | $4.6 million | $5.7 million | -20.3% |
| Cost of Revenues | $2.8 million | $2.6 million | +8.0% |
| Gross Profit | $1.8 million | $3.1 million | -43.7% |
| Operating Expenses | $7.3 million | $7.2 million | +1.2% |
| Net Loss | $(5.5) million | $(4.1) million | -32.5% |
Market Position and Challenges
GSI Technology faces challenges from supply chain constraints, inflationary pressures, and fluctuating customer demand. The company anticipates a potential turnaround in its SRAM business as customers deplete channel inventory and resume orders.
How GSI Technology, Inc. (GSIT) Makes Money
Revenue Sources
GSI Technology, Inc. primarily generates revenue from the sale of Very Fast SRAM products, which accounted for approximately 99% and 98% of total revenues in the six months ended September 30, 2024, and 2023, respectively.
In recent periods, the company has also focused on developing and marketing in-place associative computing products. The transition to these products is expected to play a significant role in future revenue streams.
Financial Performance Overview
In the three months ended September 30, 2024, GSI Technology reported net revenues of $4.55 million, down from $5.71 million in the same period of the previous year, reflecting a 20.3% decrease. For the six months ended September 30, 2024, net revenues were $9.22 million, compared to $11.30 million for the prior year, marking an 18.4% decline.
Customer Segmentation
Sales to various customer segments are crucial for GSI's revenue. The following table illustrates the breakdown of revenues by customer type for the three and six months ended September 30, 2024 and 2023:
| Customer Type | Three Months Ended September 30, 2024 (in $000s) | Three Months Ended September 30, 2023 (in $000s) | Six Months Ended September 30, 2024 (in $000s) | Six Months Ended September 30, 2023 (in $000s) |
|---|---|---|---|---|
| Contract Manufacturers | $660 | $1,324 | $1,071 | $3,274 |
| Distribution | $3,865 | $4,356 | $8,106 | $7,970 |
| OEMs | $25 | $28 | $44 | $51 |
| Total Revenue | $4,550 | $5,708 | $9,221 | $11,295 |
Key Customer Contributions
Nokia remains GSI's largest customer, representing approximately 18% of net revenues in the three months ended September 30, 2024, and 20% in the six months ended September 30, 2024.
Cost Structure and Profitability
In the three months ended September 30, 2024, GSI reported a cost of revenues of $2.79 million, leading to a gross profit of $1.76 million and a gross margin of 38.6%. This represents a significant decrease from a gross margin of 54.7% in the same period of the previous year.
Operating expenses for the same period totaled $7.34 million, which included research and development expenses of $4.79 million and selling, general and administrative expenses of $2.55 million.
Recent Financial Trends
The company reported a net loss of $5.46 million for the three months ended September 30, 2024, compared to a net loss of $4.06 million in the same period of 2023. The decline in revenues and increased operational costs have impacted profitability significantly.
Liquidity Position
As of September 30, 2024, GSI Technology had cash and cash equivalents amounting to $18.4 million, an increase from $14.4 million as of March 31, 2024.
Future Directions and Contracts
GSI Technology has secured contracts for the development of next-generation products, including a $1.1 million contract with AFWERX to develop algorithms for high-data computation. The successful execution of these contracts is expected to bolster future revenue streams.
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Article updated on 8 Nov 2024
Resources:
- GSI Technology, Inc. (GSIT) Financial Statements – Access the full quarterly financial statements for Q2 2025 to get an in-depth view of GSI Technology, Inc. (GSIT)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View GSI Technology, Inc. (GSIT)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.