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MEMSIC Announces Third-Quarter 2010 Results

MEMSIC, Inc. (NasdaqGM: MEMS), a leading MEMS sensing solution provider, today announced financial results for the third quarter ended September 30, 2010.
  • Revenues totaled $10.8 million compared to $7.1 million in the third quarter of 2009.
  • Gross margin was 37.8% compared to 41.3% in the 2009 quarter. Gross margin in the 2010 quarter was negatively impacted by a $0.4 million sales credit granted to a customer for estimated engineering and screening costs incurred during 2010. The credit reduced gross margin by 2.4 basis points.
  • Operating expenses rose to $6.4 million from $3.1 million in the 2009 quarter, including an increase in R&D expense to $2.4 million from $1.2 million.
  • Net loss in the 2010 third quarter was ($1.9) million, or ($0.08) per diluted share, compared to net income of $52,000, or $0.00 per diluted share, in the prior-year period.
  • EBITDA in the 2010 third quarter was ($1.0) million compared to $0.4 million in the 2009 quarter.

MEMSIC Chairman, President and CEO, Dr. Yang Zhao commented, “We again surpassed the top end of our quarterly revenue guidance, with our magnetic sensor and new series of ultra-low-cost accelerometers contributing significantly to our growth in this quarter. We are pleased that the market for smartphones is picking up worldwide and that MEMSIC is benefiting from this trend through a ramp up in sales to a major manufacturer of GPS-enabled mobile phones.

“In the near term, the continuous cost reduction of sensor products is helping us penetrate more cost-sensitive applications such as toys and games. In the long term, we expect continuous product development in integrated smart sensor and sensing systems to drive higher ASP and margin as well as revenue growth. With our Crossbow acquisition in January 2010, we significantly increased our R&D investment in next-generation multi-sensor and MCU integrated system products at both the IC level for the consumer and mobile market and the module level for the high-end industrial, automotive, and general aviation markets. Our next-generation product lines will naturally combine MEMSIC’s core competency in ultra-low-cost sensor product design and manufacturing with the core competency in multi-sensor system integration we acquired from Crossbow. One example is the high-performance MEMS inertial systems we recently introduced, which offer the superior reliability of our advanced MEMS technology for integrated navigation systems and in stabilization and control applications.”

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