SIMO Q3 Earnings Surpass Estimates on Healthy Revenue Growth

Silicon Motion SIMO reported relatively healthy third-quarter 2025 results, with both the top and bottom lines beating the Zacks Consensus Estimate.

The leading developer of microcontroller integrated circuits for NAND flash storage devices witnessed revenue expansion year over year, owing to healthy demand trends in several verticals. Management remains focused on delivering strong, sustainable long-term growth by broadening the product portfolio, expanding into new markets and increasing the market share in the consumer, enterprise, automotive, industrial and commercial storage markets.

Net Income

On a GAAP basis, net income in the reported quarter was $39.1 million or $1.16 per American depositary share (ADS) compared with $20.8 million or 62 cents per ADS in the prior-year quarter. Net income improved due to increasing net sales year over year and lower income tax expenses.

Non-GAAP net income was $33.8 million or $1 per ADS compared with $31 million or 92 cents per ADS in the year-ago quarter. The bottom line beat the Zacks Consensus Estimate of 81 cents.

Revenues

Quarterly revenues increased to $242 million from the year-ago quarter’s tally of $212.4 million. The top line beat the Zacks Consensus Estimate of $225 million.

Management noted that sales of SSD controllers increased 20-25% sequentially but decreased 0-5% year over year. eMMC+UFS (Embedded Multi-Media Card + Universal Flash Storage) sales increased 20-25% sequentially and 35-40% on a year-over-year basis. Revenues in SSD solutions increased 15-20% sequentially but decreased 40-45% year over year.

Other Details

Non-GAAP gross profit aggregated $117.8 million compared with $99.3 million in the year-ago quarter, with respective margins of 48.7% and 46.8%.

Non-GAAP operating expenses increased to $79.5 million from the prior-year figure of $65.1 million. Non-GAAP operating income increased to $38.3 million from $34.2 million, with margins of 15.8% and 16.1%, respectively.

Cash Flow & Liquidity

As of Sept. 30, 2025, Silicon Motion had cash, cash equivalents, restricted cash and short-term investments of $272.4 million. The company generated $26.9 million in cash from operations during the reported quarter compared to $54 million in the prior-year quarter.

In the third quarter of 2025, the company’s capital expenditure totaled $15.6 million. This included $9.9 million for the routine procurement of testing equipment, software, design tools and other goods and another $10.2 million for building construction in Hsinchu.

Outlook

For fourth-quarter 2025, management estimates non-GAAP revenues in the range of $254-$266 million. Non-GAAP gross margin is expected to be 48.5-49.5%. Non-GAAP operating margin is anticipated to be in the band of 19-20%.

Zacks Rank

SIMO currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Upcoming Releases

Arista Networks Inc. ANET is scheduled to release third-quarter 2025 earnings on Nov. 5. The Zacks Consensus Estimate for earnings is pegged at 72 cents per share, suggesting growth of 20% from the year-ago reported figure.

Arista has a long-term earnings growth expectation of 18.7%. The company delivered an average earnings surprise of 12.8% in the last four reported quarters.

Akamai Technologies, Inc. AKAM is slated to release third-quarter 2025 earnings on Nov. 6. The Zacks Consensus Estimate for earnings is pegged at $1.64 per share, indicating 3.1% growth from the year-ago reported figure.

Akamai has a long-term earnings growth expectation of 4.9%. The company delivered an average earnings surprise of 7.1% in the last four reported quarters.

Pinterest, Inc. PINS is set to release third-quarter 2025 earnings on Nov. 4. The Zacks Consensus Estimate for earnings is pegged at 42 cents per share, implying growth of 5% from the year-ago reported figure.

Pinterest has a long-term earnings growth expectation of 33.9%. The company delivered an average negative earnings surprise of 1.1% in the last four reported quarters.

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This article originally published on Zacks Investment Research (zacks.com).

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