Silicon Motion's Q4 Earnings Miss Estimates, Revenues Rise Y/Y

Silicon Motion Technology Corporation SIMO reported mixed fourth-quarter 2025 results, with revenues beating the Zacks Consensus Estimate but adjusted earnings missing the same.

The leading developer of microcontroller integrated circuits for NAND flash storage devices reported a strong year-over-year revenue growth driven by solid PCIe 5 SSD demand, market share gains in Embedded Multi-Media Card and Universal Flash Storage, rising automotive sales and early enterprise demand. However, earnings lagged expectations due to higher R&D and operating costs, product mix pressures and competitive pricing.

Net Income

On a GAAP basis, net income in the reported quarter improved to $47.7 million or $1.41 per American depositary share (ADS) from $21.6 million or 64 cents per ADS in the prior-year quarter, primarily due to higher net sales. 

Non-GAAP net income was $42.7 million or $1.26 per ADS compared with $29.4 million or 87 cents per ADS in the year-ago quarter. The bottom line missed the Zacks Consensus Estimate of $1.29 per ADS.

For 2025, Silicon Motion reported GAAP net income of $122.6 million or $3.64 per ADS compared with $89.2 million or $2.65 per ADS in 2024. Non-GAAP net income for 2025 was $119.8 million or $3.55 per ADS compared with $114.5 million or $3.39 per ADS in 2024.
 

Silicon Motion Technology Corporation Price, Consensus and EPS Surprise

Silicon Motion Technology Corporation price-consensus-eps-surprise-chart | Silicon Motion Technology Corporation Quote

Revenues

Quarterly revenues increased to $278.5 million from the year-ago quarter’s tally of $191.2 million. The top line beat the Zacks Consensus Estimate of $261.2 million. For 2025, revenues increased to $885.6 million from $803.6 million in 2024.

Management noted that in the fourth quarter of 2025, sales of SSD controllers increased 35-40% year over year on strong demand trends. Embedded Multi-Media Card + Universal Flash Storage (eMMC+UFS) sales increased 50-55% while revenues in SSD solutions were up 110-115% year over year.

Other Details

Non-GAAP gross profit aggregated $137 million compared with $87.9 million in the year-ago quarter, with respective margins of 49.2% and 46%. For 2025, non-GAAP gross profit increased to $427.9 million from $369.3 million in 2024, with respective margins of 48.3% and 46%. 

During the quarter, non-GAAP operating expenses increased to $83.2 million from the prior-year figure of $58.3 million. However, non-GAAP operating income increased to $53.8 million from $29.6 million on higher revenues, with margins of 19.3% and 15.5%, respectively.

Cash Flow & Liquidity

As of Dec. 31, 2025, Silicon Motion had cash and cash equivalents of $201.8 million compared with $276.1 million a year ago. The company generated $1.6 million in cash from operations during the reported quarter compared to cash utilization of $6.2 million in the prior-year quarter. For 2025, the company generated $61.4 million of cash from operating activities compared with $77.1 million in 2024.

In the fourth quarter of 2025, capital expenditure totaled $7.8 million. This included $6.2 million for the routine procurement of testing equipment, software, design tools and other goods and another $1.6 million for building construction in Hsinchu.

Outlook

For first-quarter 2026, management estimates non-GAAP revenues in the range of $292-$306 million. Non-GAAP gross margin is expected to be in the range of 46-47%. Non-GAAP operating margin is anticipated to be in the band of 16-18%.

Zacks Rank

Silicon Motion 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 fourth-quarter 2025 earnings on Feb. 12. The Zacks Consensus Estimate for earnings is pegged at 75 cents per share, suggesting growth of 15.38% from the year-ago reported figure.

Arista has a long-term earnings growth expectation of 20.08%. The company delivered an average earnings surprise of 10.17% in the last four reported quarters.

Lyft, Inc. LYFT is scheduled to release fourth-quarter 2025 earnings on Feb. 10. The Zacks Consensus Estimate for earnings is pegged at 32 cents per share, suggesting growth of 6.67% from the year-ago reported figure.

Lyft has a long-term earnings growth expectation of 24.41%. The company delivered an average earnings surprise of 1.17% in the last four reported quarters.

Akamai Technologies, Inc. AKAM is slated to release fourth-quarter 2025 earnings on Feb. 19. The Zacks Consensus Estimate for earnings is pegged at $1.75 per share, indicating 5.42% growth from the year-ago reported figure.

Akamai has a long-term earnings growth expectation of 5.96%. The company delivered an average earnings surprise of 10.46% in the last four reported quarters.

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

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