1Non-GAAP measures represent GAAP measures excluding the impact of stock-based compensation, acquisition-related charges, foreign exchange gain (loss), litigation expenses, gains from settlement of litigation, and impairment of long-term assets. For reconciliation of non-GAAP to GAAP results and further discussion, see accompanying financial tables and the note "Discussion of Non-GAAP Financial Measures" at the end of this press release.
Fourth Quarter 2012 Financial Review
Commenting on the results of the fourth quarter, Silicon Motion's President and CEO, Wallace Kou, said:
"2012 was a record year for us. We delivered our highest annual revenue and EPS in our Company's history. We had a solid finish to the year and executed well in transitioning our growth to our New Growth Products, primarily our eMMC controllers and LTE transceivers. In 2012, our New Growth Product sales grew almost 140% from the prior year and accounted for 31% of our total revenue.
"Our fourth quarter results were largely as expected and as communicated. Our overall quarterly revenue fell slightly, primarily due to third quarter's accelerated sales of LTE transceivers to Samsung for its Galaxy S3 LTE smartphone—sales that we had originally planned for the fourth quarter. Our eMMC controller sales were flat sequentially due to strong pre-holiday sales build in the third quarter. Controllers for our bundled card sales increased sequentially while our retail card controller sales declined. USB flash drive controller sales were up modestly.
"We believe that our business remains very well positioned for further growth led by our New Growth Products. We anticipate that sales of our eMMC 4.41 controllers, with which we have had tremendous success and are shipping to both Samsung and SK Hynix, will continue to grow strongly this year. Additionally, I am pleased to announce that our new eMMC 4.5 controller, an even higher performance and more cost competitive 55nm solution, has successfully taped out and is currently being sampled by our flash partners; we expect this product to enter mass production in the first quarter of 2013. Also, our new fifth generation LTE transceiver, a single die 55nm GSM/EDGE/HSPA/LTE solution that is higher performance and lower cost, is in final qualification with Samsung. We are honored to be Samsung's LTE transceiver partner and are pleased with Samsung's phenomenal success in bringing successive generations of world-class LTE smartphones and tablets to market."