GSI (GSIT) Q2 2027 earnings summary

Executive summary

• Q2 FY2027 revenue was $6.019 million, within guidance, while gross margin fell to 48.5% amid supply constraints, higher manufacturing costs and unfavorable mix.

• Smart Guardian Eye Phase One was accepted in Taiwan; Gemini-II development and commercialization continued, GRIN advanced, and Plato remained on schedule for March 2027 tape-out.

Financial highlights

• Net revenue was $6.019 million vs. $6.444 million YoY and $6.312 million QoQ.

• Operating expenses were $10.353 million vs. $6.720 million YoY and $8.754 million QoQ; R&D was $6.048 million and SG&A was $4.305 million.

• Operating loss was $7.435 million and net loss was $7.021 million, or $0.18 per diluted share.

• Gross margin was 48.5%, below guidance of 53%-55%, primarily due to higher wafer, assembly, burn-in and testing costs and unfavorable product mix.

Outlook and guidance

• Q3 FY2027 revenue guidance is $5.0 million to $6.0 million, with gross margin of ~38%-40%.

• Price increases are planned immediately for new orders and from Jan. 1, 2027, for existing backlog; improved availability and pricing are expected to support recovery from Q4 FY2027.

• GRIN AI-assisted SDK release to initial customers is targeted before end-December 2026, with commercial release in H1 2027; Gemini-II commercialization expansion is anticipated in calendar 2027.

• Plato tape-out remains targeted for March 2027, with first-spin samples targeted for late summer 2027.