#USA #Portland #Tencent #Pixelworks #TrueCut Motion

Pixelworks Reports First Quarter Financial Results for 2025

On May 13, 2025, Pixelworks, Inc. (NASDAQ: PXLW) released its financial results for the first quarter ended March 31, 2025. Despite facing anticipated seasonality in both the home and enterprise markets, the company observed promising growth in its mobile sector, reflecting a 140% sequential increase in this area. The total revenue recorded standing at $7.1 million, a decrease from $9.1 million in the fourth quarter of the previous year and from $16.1 million compared to the same period last year.

Highlights of the Quarter

• - The mobile market's robust recovery was a focal point, significantly contributing to revenue despite the overall decline.
• - Pixelworks made strides in innovating its service offerings, notably through a partnership with Tencent's PerfDog. This will introduce a new benchmarking tool aimed at enhancing mobile gaming performance.
• - The company solidified a collaboration with a leading post-production company to further develop its TrueCut Motion platform, focusing on improving image processing solutions for varied media.
• - Pixelworks is actively discussing potential strategic options concerning its Shanghai subsidiary, suggesting an exploration of various avenues for growth.

Todd DeBonis, President and CEO of Pixelworks, commented on the quarter's performance, indicating that results met their expectations while noting a clear advantage from previously implemented cost-efficient measures. Operating expenses decreased by over $2 million compared to the prior year. DeBonis emphasized the importance of mobile revenue growth, highlighting ongoing engagements with smartphone manufacturers to integrate innovative low-cost graphics solutions into entry-level devices.

Financial Metrics

On a GAAP basis, Pixelworks reported a gross profit margin of 48.7% and operating expenses of $11.5 million. Despite the revenue drop, these figures reflect a continuing effort to maintain operational efficiency.

For the first quarter of 2025, the company reported a GAAP net loss of $7.8 million, translating to a loss of ($0.13) per share. This is notably higher compared to the GAAP net loss of $5.4 million in the previous quarter. Non-GAAP metrics revealed a similar trend, with a net loss of $6.5 million or ($0.11) per share. Adjusted EBITDA stood at negative $5.8 million, also reflecting an increasing deficit, which indicates a need for ongoing adjustments in strategy.

Future Outlook

Looking ahead, Pixelworks is focused on refining its strategic and operational plans, particularly in the mobile market. The team is optimistic about the adoption of TrueCut Motion technology across the industry while aspiring to improve the financial standing of the Pixelworks Shanghai subsidiary by mid-2025. The upcoming quarterly results will be further discussed in Pixelworks' scheduled conference call, where they will provide insights into the company's roadmap for recovery and growth in a challenging economic climate.

Conclusion

As Pixelworks navigates the complexities of a fluctuating market, the commitment to strategic partnerships and cost management reflects a calculated approach to rebuilding momentum and addressing emerging opportunities within the mobile sector. The shift towards collaborative developments indicates a proactive stance towards enhancing service offerings and technological advancements, laying a promising foundation for future prospects.