Techwell Inc. (TWLL, Financial) filed Quarterly Report for the period ended 2009-03-31.
TECHWELL INC is a fabless semiconductor company that designs markets and sells mixed signal integrated circuits for multiple video applications in the security surveillance automotive and consumer markets. Techwell designs application specific products that enable the conversion of analog video signals to digital form and perform advanced digital video processing to facilitate the display storage and transport of video content. Headquartered in San Jose CA Techwell currently has operations in the U.S. Korea Taiwan China and Japan Techwell Inc. has a market cap of $151.1 million; its shares were traded at around $7.05 with a P/E ratio of 20.1 and P/S ratio of 2.3.
Revenues were $10.3 million for the three months ended March 31, 2009 and $15.6 million for the three months ended March 31, 2008, a decrease of 34% due to decreased demand primarily as a result of current economic conditions. Revenues from our security surveillance products decreased $4.1 million, or 35%, in the three months ended March 31, 2009 compared to the three months ended March 31, 2008. Revenues from of our automotive infotainment products decreased slightly by $10,000, or 1%, in the three months ended March 31, 2009 compared to the three months ended March 31, 2008. Revenues from consumer products decreased $1.0 million, or 45%, in the three months ended March 31, 2009 compared to the three months ended March 31, 2008. Other revenues decreased $0.2 million, or 96%, in the three months ended March 31, 2009 compared with the three months ended March 31, 2008.
Gross profit was $6.2 million for the three months ended March 31, 2009 and $9.5 million for the three months ended March 31, 2008, a decrease of 35%. Gross margin was 60% for the three months ended March 31, 2009 decreasing slightly from 61% for the three months ended March 31, 2008. The decrease in gross profit was primarily due to a decrease in revenues of $5.3 million, or 34%.
Research and development expenses were $4.3 million, or 42% of revenues, for the three months ended March 31, 2009 and $3.5 million, or 23% of revenues, for the three months ended March 31, 2008, an increase of 22%. The increase in research and development expense was primarily attributable to increased compensation-related expenses of $0.6 million reflecting both increases in stock-based compensation and in headcount to support the development of new products and technologies and an increase of $0.2 million of tape-out expenses as a result of our development of new products and our migration to smaller geometry process technologies.
We incurred stock-based compensation expense associated with research and development personnel of $0.9 million and $0.7 million in the three months ended March 31, 2009 and 2008, respectively. The increase in stock-based compensation expenses was a result of the increase in research and development personnel.
Selling, general and administrative expenses were $3.5 million, or 34% of revenues, for the three months ended March 31, 2009 and $3.7 million, or 24% of revenues, for the three months ended March 31, 2008, a decrease of 4%. The slight decrease in selling, general and administrative expenses was attributable to a decrease of $0.2 million in compensation-related expenses.
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TECHWELL INC is a fabless semiconductor company that designs markets and sells mixed signal integrated circuits for multiple video applications in the security surveillance automotive and consumer markets. Techwell designs application specific products that enable the conversion of analog video signals to digital form and perform advanced digital video processing to facilitate the display storage and transport of video content. Headquartered in San Jose CA Techwell currently has operations in the U.S. Korea Taiwan China and Japan Techwell Inc. has a market cap of $151.1 million; its shares were traded at around $7.05 with a P/E ratio of 20.1 and P/S ratio of 2.3.
Highlight of Business Operations:
Although our revenues have grown rapidly in a short period of time, we do not expect to achieve similar growth rates in the future. For example, our revenues for the three months ended March 31, 2009 were $10.3 million, a decline of $6.2 million from the prior quarter. We currently expect to increase our expense levels in each of the next several quarters to support increased research and development efforts. These expenditures may not result in increased revenue or profitability in the future. In addition, our ability to increase our revenues will depend on increased demand for digital video applications in the security surveillance and automotive infotainment markets. The growth of our target markets is uncertain. In addition, the timing of orders by and shipments to our customers, as well as general trends in our target markets, can cause our revenue growth to be inconsistent.Revenues were $10.3 million for the three months ended March 31, 2009 and $15.6 million for the three months ended March 31, 2008, a decrease of 34% due to decreased demand primarily as a result of current economic conditions. Revenues from our security surveillance products decreased $4.1 million, or 35%, in the three months ended March 31, 2009 compared to the three months ended March 31, 2008. Revenues from of our automotive infotainment products decreased slightly by $10,000, or 1%, in the three months ended March 31, 2009 compared to the three months ended March 31, 2008. Revenues from consumer products decreased $1.0 million, or 45%, in the three months ended March 31, 2009 compared to the three months ended March 31, 2008. Other revenues decreased $0.2 million, or 96%, in the three months ended March 31, 2009 compared with the three months ended March 31, 2008.
Gross profit was $6.2 million for the three months ended March 31, 2009 and $9.5 million for the three months ended March 31, 2008, a decrease of 35%. Gross margin was 60% for the three months ended March 31, 2009 decreasing slightly from 61% for the three months ended March 31, 2008. The decrease in gross profit was primarily due to a decrease in revenues of $5.3 million, or 34%.
Research and development expenses were $4.3 million, or 42% of revenues, for the three months ended March 31, 2009 and $3.5 million, or 23% of revenues, for the three months ended March 31, 2008, an increase of 22%. The increase in research and development expense was primarily attributable to increased compensation-related expenses of $0.6 million reflecting both increases in stock-based compensation and in headcount to support the development of new products and technologies and an increase of $0.2 million of tape-out expenses as a result of our development of new products and our migration to smaller geometry process technologies.
We incurred stock-based compensation expense associated with research and development personnel of $0.9 million and $0.7 million in the three months ended March 31, 2009 and 2008, respectively. The increase in stock-based compensation expenses was a result of the increase in research and development personnel.
Selling, general and administrative expenses were $3.5 million, or 34% of revenues, for the three months ended March 31, 2009 and $3.7 million, or 24% of revenues, for the three months ended March 31, 2008, a decrease of 4%. The slight decrease in selling, general and administrative expenses was attributable to a decrease of $0.2 million in compensation-related expenses.
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