Himax Technologies (HIMX) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue reached $239.6 million, up 16.5% sequentially, surpassing guidance, with gross margin at 32%, driven by resumed order momentum and favorable product mix, especially in automotive IC and Tcon lines.

• After-tax profit for Q2 was $29.6 million ($0.169 per diluted ADS), at the top end of guidance, up 137% sequentially and over 3,200% year-over-year.

• Automotive IC business remained the largest revenue contributor, accounting for over 47% of total sales in Q2.

• Strategic investments were made in FOCI ($16 million, 5.3% stake) and Obsidian Sensors to expand into silicon photonics and thermal imaging.

• The company maintains a diversified customer base, strong partnerships, and a robust IP portfolio.

Financial highlights

• Q2 2024 net revenues: $239.6 million (+15.5% QoQ, +2.0% YoY); gross margin: 32.0% (up from 29.3% in Q1 and 21.7% YoY).

• Q2 operating income was $29.3 million (12.2% of sales), up from -0.9% a year ago and 4.8% last quarter.

• Cash, cash equivalents, and other financial assets at quarter-end were $253.8 million, down from $277.4 million last quarter, mainly due to customer deposit refunds and a $16 million FOCI investment.

• Q2 operating expenses were $47.3 million, down 6.7% sequentially and 11.1% year-over-year, mainly from reduced R&D and lower bonus amortization.

• Operating cash inflow for Q2 was $26.9 million; capex: $4.6 million, mainly for R&D and in-house testing equipment.

Outlook and guidance

• Q3 2024 revenue expected to decrease 12–17% sequentially, with gross margin around 30%; profit per diluted ADS estimated at $0.015–$0.045.

• Q3 guidance reflects continued macroeconomic uncertainty, conservative customer procurement, and higher operating expenses from annual employee bonuses.

• Automotive IC revenue in Q3 expected to decrease high teens sequentially, but still forecasted to grow mid-teens year-over-year for the first nine months.

• Non-driver IC and T-Con sales anticipated to decline double digits sequentially in Q3.

• High dividend payout ratio (100% in 2024) is supported by a positive business outlook and strong balance sheet.