eMemory Technology (3529) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue reached NT$893 million, up 11.2% sequentially and 28.2% year-over-year, with strong growth in both licensing and royalty streams.

• Net income for Q2 2024 was NT$475 million, up 10.3% sequentially and 35.1% year-over-year; H1 2024 net profit was NT$896 million, up 36% year-over-year.

• Gross margin remained at 100% for both Q2 and H1 2024; operating margin improved to 55.5%.

• Focus on evolving from OTP to advanced security IP, MTP, and emerging memories, increasing royalty per wafer as technology advances.

• Continued technology development and business expansion, including new IPs and advanced process nodes.

Financial highlights

• H1 2024 revenue totaled NT$1,695.8 million, up 24.3% year-over-year.

• Operating income for Q2 2024 was NT$495 million, up 17.7% sequentially and 34.3% year-over-year; H1 2024 operating income was NT$916 million, up 24%.

• EPS for Q2 2024 was NT$6.36, up 10.2% sequentially and 35% year-over-year; H1 2024 EPS was NT$12.13.

• ROE reached 67.3% in Q2 2024, up 14.1 percentage points from Q1 2024.

• Licensing revenue accounted for 33.6% and royalty revenue 66.4% of Q2 2024 revenue.

Outlook and guidance

• Licensing revenue expected to maintain growth momentum due to strong demand from foundries and chip companies.

• Royalty revenue projected to grow sequentially in H2 2024 as new products ramp up.

• Continued development in advanced nodes (2nm, 3nm) and new IPs for next-generation applications.

• CPU architecture for security IP will begin contributing to revenue.