GSI Technology, Inc. EBITDA dropped on 420% and Revenue dropped on 11.5%
05/03/2018 • About GSI Technology, Inc. (
$GSIT) • By InTwits
GSI Technology, Inc. reported FY2018 financial results today. Overall the company's long term financial model is characterised by the following facts:
- GSI Technology, Inc. is a company in decline: FY2018 revenue growth was -11.5%, 5 years revenue CAGR was -8.4%
- The company operates at negative EBITDA Margin: -7.5%
- GSI Technology, Inc. spends a lot for Stock Based Compensation (SBC): average SBC/Revenue for FY2014-FY2018 is 0.0%. Average EBITDA Margin for the same period was -4.7%
- GSI Technology, Inc. has low CAPEX intensity: 5 year average CAPEX/Revenue was 1.6%. At the same time it's in pair with industry average of 7.4%
- CAPEX is quite volatile: $1m in FY2018, $0m in FY2017, $1m in FY2016, $0m in FY2015, $1m in FY2014
- The company has unprofitable business model: ROIC is -5.2%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue dropped on 11.5%. Annual revenue decline showed slowdown in FY18Q4 - revenue increased on 7.7%. During the last 5 years Revenue growth topped in FY2016 at -1.4% and was decelerating since that time. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased on 9.6 pp from 2.1% to -7.5% in FY2018.
Gross Margin decreased on 2.2 pp from 54.8% to 52.6% in FY2018. Gross Margin followed a growing trend at 2.4 pp per annum in FY2014-FY2018. SG&A as a % of Revenue showed almost no change in FY2018.
Net Income margin dropped on 10.3 pp from -0.24% to -10.6% in FY2018. During the last 5 years Net Income margin topped in FY2017 at -0.24%.
Investments (CAPEX, working capital and M&A)
GSI Technology, Inc.'s CAPEX/Revenue was 3.1% in FY2018. CAPEX/Revenue increased on 2.2 pp from 0.90% in FY2015 to 3.1% in FY2018. It's average CAPEX/Revenue for the last three years was 1.9%.
Return on investment
The company operates at negative ROIC (-5.2%) and ROE (-5.2%). ROIC decreased on 4.6 pp from -0.59% to -5.2% in FY2018. ROE decreased on 5.1 pp from -0.13% to -5.2% in FY2018. During the last 5 years ROE topped in FY2017 at -0.13%.
Leverage (Debt)
The company has no debt. Cash jumped on 19.3%.
Management team
The company's CEO is Lee-Lean Shu. Lee-Lean Shu is a founder and has 18 years tenure with the company. GSI Technology, Inc.'s CFO is Douglas M Schirle. Douglas M Schirle has 19 years tenure at the company.
Financial and operational results
FY ended 03/31/2018
GSI Technology, Inc. ($GSIT) key annual financial indicators| mln. $ | 2014 | 2015 | 2016 | 2017 | 2018 | 2018/2017 |
|---|
P&L
|
|---|
| Revenue | 58.579 | 53.498 | 52.736 | 48.180 | 42.643 | -11.5% |
| Gross Profit | 26.110 | 25.123 | 26.737 | 26.416 | 22.426 | -15.1% |
| SG&A | 18.814 | 19.247 | 17.663 | 11.140 | 9.899 | -11.1% |
| EBITDA | -3.833 | -4.408 | -1.562 | 1.005 | -3.216 | -420.0% |
| Net Income | -6.189 | -4.978 | -2.170 | -0.115 | -4.515 | |
Balance Sheet
|
|---|
| Cash | 41.520 | 36.776 | 31.963 | 33.736 | 40.241 | 19.3% |
| Short Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
| Long Term Debt | 0.000 | 0.000 | 0.000 | 0.000 | 0.000 | |
Cash flow
|
|---|
| Capex | 0.761 | 0.481 | 1.158 | 0.219 | 1.320 | 502.7% |
Ratios
|
|---|
| Revenue growth | -11.3% | -8.7% | -1.4% | -8.6% | -11.5% | |
| EBITDA growth | -166.1% | 15.0% | -64.6% | -164.3% | -420.0% | |
|
|---|
| Gross Margin | 44.6% | 47.0% | 50.7% | 54.8% | 52.6% | -2.2% |
| EBITDA Margin | -6.5% | -8.2% | -3.0% | 2.1% | -7.5% | -9.6% |
| SG&A, % of revenue | 32.1% | 36.0% | 33.5% | 23.1% | 23.2% | 0.1% |
| Net Income Margin | -10.6% | -9.3% | -4.1% | -0.2% | -10.6% | -10.3% |
| CAPEX, % of revenue | 1.3% | 0.9% | 2.2% | 0.5% | 3.1% | 2.6% |
|
|---|
| ROIC | -4.5% | -5.4% | -3.2% | -0.6% | -5.2% | -4.6% |
| ROE | -4.8% | -4.4% | -2.3% | -0.1% | -5.2% | -5.1% |
| Net Debt/EBITDA | | | | -33.6x | |
GSI Technology, Inc. ($GSIT) key quoterly financial indicators
| mln. $ | FY18Q1 | FY18Q2 | FY18Q3 | FY18Q4 | | YoY change |
|---|
P&L
|
|---|
| Revenue | 11 | 10 | 11 | 11 | | -17.4% | -27.8% | -3.2% | 7.7% |
| EBITDA | -1 | -1 | -1 | 0 | | -250.4% | -289.8% | -218.6% | |
| Net Income | -2 | -2 | -2 | 0 | | -681.5% | -378.0% | -539.1% | |
Balance Sheet
|
|---|
| Cash | 32 | 37 | 40 | 40 | | 12.9% | 30.0% | 30.3% | 19.3% |
| Short Term Debt | 0 | 0 | 0 | 0 | | | | | |
| Long Term Debt | 0 | 0 | 0 | 0 | | | | | |
Ratios
|
|---|
| Gross Margin | 52.4% | 50.4% | 51.0% | 56.2% | | 0.5% | -4.6% | -5.5% | -0.2% |
| EBITDA Margin | -11.4% | -15.3% | -6.4% | 1.8% | | -17.7% | -21.1% | -11.7% | 13.2% |
| Net Income Margin | -14.1% | -18.0% | -13.7% | 2.4% | | -16.2% | -22.7% | -16.8% | 15.3% |
Peers in Semiconductors
Below you can find GSI Technology, Inc. benchmarking vs. other companies in Semiconductors industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by Revenue growth, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| NanoFlex Power Corp ($OPVS) | | | | 72.5% | 354.8% |
| MoSys, Inc. ($MOSY) | | -18.4% | 37.2% | 46.8% | 87.7% |
| SMART Global Holdings, Inc. ($SGH) | | | -16.9% | 42.5% | 69.3% |
| Micron Technology, Inc. ($MU) | | -1.0% | -23.4% | 63.9% | 49.5% |
| Adesto Technologies Corporation ($IOTS) | | 4.3% | 1.6% | 27.6% | 48.8% |
| |
|---|
| Median (67 companies) | 54.6% | 9.7% | 5.2% | 11.0% | 5.0% |
|---|
| GSI Technology, Inc. ($GSIT) | | -8.7% | -1.4% | -8.6% | -11.5% |
Top companies by Gross margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| CEVA, Inc. ($CEVA) | 90.2% | 90.9% | 91.6% | 92.1% | 89.8% |
| NVE Corporation ($NVEC) | 77.9% | 80.3% | 76.1% | 78.5% | 79.0% |
| Rambus, Inc. ($RMBS) | 85.9% | 84.7% | 80.1% | 79.9% | 76.8% |
| Universal Display Corporation ($OLED) | 76.0% | 64.2% | 83.9% | 80.8% | 75.5% |
| Intermolecular, Inc. ($IMI) | 48.3% | 57.4% | 66.5% | 67.5% | 70.3% |
| |
|---|
| Median (65 companies) | 46.4% | 47.7% | 47.2% | 48.6% | 50.4% |
|---|
| GSI Technology, Inc. ($GSIT) | 44.6% | 47.0% | 50.7% | 54.8% | 52.6% |
Top companies by EBITDA margin, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| NVE Corporation ($NVEC) | 58.8% | 66.0% | 61.8% | 65.6% | 65.1% |
| Micron Technology, Inc. ($MU) | 31.7% | 35.0% | 25.4% | 47.9% | 65.0% |
| NXP Semiconductors N.V. ($NXPI) | 25.7% | 41.5% | 21.6% | 46.2% | 49.9% |
| Texas Instruments Incorporated ($TXN) | 39.7% | 42.0% | 43.5% | 46.7% | 48.6% |
| Intel Corp ($INTC) | 42.8% | 41.0% | 35.2% | 41.7% | 45.7% |
| |
|---|
| Median (66 companies) | 9.9% | 11.5% | 9.2% | 10.7% | 10.0% |
|---|
| GSI Technology, Inc. ($GSIT) | -6.5% | -8.2% | -3.0% | 2.1% | -7.5% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| Alpha and Omega Semiconductor Limited ($AOSL) | 3.0% | 6.6% | 6.5% | 12.2% | 42.2% |
| Renesola Ltd. ($SOL) | 3.5% | 0.0% | 0.0% | 78.0% | 41.7% |
| First Solar, Inc. ($FSLR) | 7.6% | 4.0% | 7.9% | 17.5% | 33.0% |
| Sigma Designs Inc ($SIGM) | 11.0% | 6.5% | 6.2% | 14.1% | 29.3% |
| Micron Technology, Inc. ($MU) | 19.0% | 24.8% | 46.9% | 23.3% | 29.2% |
| |
|---|
| Median (66 companies) | 3.6% | 4.0% | 3.7% | 4.7% | 4.6% |
|---|
| GSI Technology, Inc. ($GSIT) | 1.3% | 0.9% | 2.2% | 0.5% | 3.1% |
Top companies by ROIC, %
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| SMART Global Holdings, Inc. ($SGH) | | | 2.5% | 21.5% | 51.7% |
| Texas Instruments Incorporated ($TXN) | 25.1% | 29.8% | 34.9% | 43.1% | 47.5% |
| Micron Technology, Inc. ($MU) | 18.8% | 15.8% | 0.8% | 21.5% | 42.9% |
| Applied Materials Inc ($AMAT) | 15.8% | 15.2% | 19.0% | 31.2% | 36.4% |
| NVIDIA Corporation ($NVDA) | 9.2% | 13.3% | 13.1% | 27.3% | 35.3% |
| |
|---|
| Median (73 companies) | 5.7% | 3.8% | 1.7% | 3.2% | 5.2% |
|---|
| GSI Technology, Inc. ($GSIT) | -4.5% | -5.4% | -3.2% | -0.6% | -5.2% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2014 | FY2015 | FY2016 | FY2017 | FY2018 |
|---|
| MACOM Technology Solutions Holdings, Inc. ($MTSI) | 25.4x | 3.3x | 3.0x | 7.2x | 98.6x |
| Inphi Corporation ($IPHI) | | -6.4x | 4.5x | 33.7x | 32.2x |
| JinkoSolar Holding Company Limited ($JKS) | 4.2x | 3.3x | 4.1x | 11.0x | 8.2x |
| Lattice Semiconductor Corporation ($LSCC) | -1.8x | | 6.5x | 19.0x | 3.9x |
| Renesola Ltd. ($SOL) | 7.0x | 35.0x | 123.6x | 2.3x | 3.3x |
| |
|---|
| Median (46 companies) | -0.5x | -0.2x | 0.2x | 0.4x | 0.3x |
|---|
