Announces Preliminary First Quarter 2016 Revenue of $11.1 Million
Pixelworks, Inc. (NASDAQ: PXLW), an innovative provider of video display
processing technology, today announced a restructuring to streamline its
product offerings and organization, including an approximately 24%
reduction in workforce, in the areas of development, operations, sales
and marketing. Pixelworks expects the restructuring to result in
annualized savings of at least $5.0 million.
Stephen Domenik, Pixelworks’ interim CEO, commented, “The purpose of
today’s announced restructuring is twofold: the first objective being to
streamline the organization and our offerings, while also intensifying
the Company’s focus and resources on opportunities with the largest
potential impact. We remain fully committed to executing on our mobile
strategy and maintaining our existing projector business. The actions we
have taken today will provide for a significantly more optimized and
targeted approach in each business going forward.”
“The second objective of today’s restructuring and workforce reduction
is to more appropriately align the Company’s expenses with current
revenue levels,” continued Mr. Domenik. “More specifically, we expect
that our improved cost structure combined with revenue growth for the
balance of the year will enable the Company to achieve cash flow
breakeven by the fourth quarter. Collectively, I strongly believe these
two objectives are essential to Pixelworks’ future success as well as
generating the greatest value for its shareholders.”
The Company expects to incur total charges of approximately $4.4 million
related to asset disposal costs and employee severance and benefits,
which will largely be recorded in the first quarter of 2016. Pixelworks
expects the restructuring to be substantially completed by the end of
its third quarter ending September 30, 2016.
Preliminary First Quarter 2016 Results
The Company also reported preliminary first quarter 2016 results with
revenue of approximately $11.1 million. First quarter GAAP net loss per
share excluding anticipated charges of $4.2 million, or $0.15 per share,
is expected to be within the Company’s original quarterly guidance range
of a net loss between $0.16 and $0.23 per share. The Company notes,
these results are preliminary and subject to adjustment during the
standard accounting close process.
Pixelworks will report its complete first quarter 2016 results and
provide additional details related to today’s announcement as part of
its quarterly earnings conference call, which is currently scheduled for
Thursday, April 28th at 2:00 p.m. Pacific Time.
About Pixelworks, Inc.
Pixelworks creates, develops and markets video display processing
technology for digital video applications that demand the very highest
quality images. At design centers around the world, Pixelworks engineers
constantly push video performance to keep manufacturers of consumer
electronics and professional displays worldwide on the leading edge. The
company is headquartered in San Jose, CA.
For more information, please visit the company’s Web site at www.pixelworks.com.
Safe Harbor Statement
This release contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E
of the Securities Exchange Act of 1934, as amended. These statements may
be identified by use of terms such as “begin,” “continue,” “will,”
“expect”, “believe,” and similar terms or the negative of such terms,
and include, without limitation, the restructuring and reduction in
workforce and the impact thereof, the charges and cash expenditures and
timing related thereto, the annual savings as a result of the
restructuring and the effect on the Company’s strategy, business and
approach, the Company’s expectations regarding the achievement of cash
flow breakeven and the timing thereof, and the preliminary first quarter
2016 results, including revenue and GAAP net loss per share. All
statements other than statements of historical fact are forward-looking
statements for purposes of this release, including any projections of
revenue or other financial items or any statements regarding the plans
and objectives of management for future operations. Such statements are
based on management's current expectations, estimates and projections
about the Company's business. These statements are not guarantees of
future performance and involve numerous risks, uncertainties and
assumptions that are difficult to predict. Actual results could vary
materially from those contained in forward looking statements due to
many factors, including, without limitation: whether the Company will be
able to implement the restructuring program as planned, whether the
expected amount of the costs associated with the restructuring program
will differ from or exceed the Company's estimates and whether the
Company will be able to realize the full amount of estimated savings
from the restructuring program or within the timeframe expected; our
ability to execute on our strategy; competitive factors, such as rival
chip architectures, introduction or traction by competing designs, or
pricing pressures; the success of our products in expanded markets;
current global economic challenges; changes in the digital display and
projection markets; seasonality in the consumer electronics market; our
efforts to achieve profitability from operations; our limited financial
resources and our ability to attract and retain key personnel. More
information regarding potential factors that could affect the Company's
financial results and could cause actual results to differ materially
from those discussed in the forward-looking statements is included from
time to time in the Company's Securities and Exchange Commission
filings, including our Annual Report on Form 10-K for the year ended
December 31, 2015 as well as subsequent SEC filings.
The forward-looking statements contained in this release speak as of the
date of this release, and Pixelworks does not undertake any obligation
to update any such statements, whether as a result of new information,
future events or otherwise.
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