- eMemory Technology Inc (ROCO:3529) Q1 2026 Earnings Call Highlights: Record Revenue Growth and ...
May 11, 2026
This article first appeared on GuruFocus.
Release Date: May 08, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
eMemory Technology Inc (ROCO:3529) reported a record-high operating performance in Q1 2026, with revenue increasing by 20% year-over-year. The company successfully expanded into new areas such as high-speed interface applications and AI server CPU applications. Licensing revenue saw significant growth, increasing by 58.6% year-over-year, driven by strong demand for advanced node technologies and AI-related applications. eMemory Technology Inc (ROCO:3529) is actively transitioning from an IP provider to a system-level security solution provider, positioning itself as a key beneficiary of the global hardware security upgrade trend. The company is collaborating with Intel Foundry to bring PUF-based IP onto Intel 18A, addressing supply chain security requirements from the U.S. government.
Negative Points
Operating expenses increased by 10.8% year-over-year, which could impact profitability if not managed effectively. Royalty revenue experienced a temporary decline due to a disruption caused by the sale of a Taiwan-based foundry customer. The decline in 8-inch wafer royalties, down 15.9% year-over-year, reflects challenges in this segment. The company faces potential risks associated with the semiconductor and IP business, as highlighted in their cautionary statement. Despite strong revenue growth, the operating margin remained relatively flat sequentially, indicating potential pressure on margins.
Q & A Highlights
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Q: Why did royalty revenue decline in April compared to the previous quarter, despite an increase in foundry revenues? A: Michael He, President: The decline in royalty revenue was mainly due to a temporary disruption caused by the sale of a Taiwan-based foundry customer, which was a production site for certain end customer applications. This led to a short-term decline in royalty contribution. We expect this impact to be temporary, as customers shift production to other foundries, and the related royalty revenue should gradually recover.
Q: What was the reason behind the decline in 8-inch royalty revenue in the first quarter, and will the recent increase in 8-inch foundry pricing provide support going forward? A: Michael He, President: The royalty revenue recognized in Q1 reflects foundry shipments from the fourth quarter of last year, still reflecting last year's foundry pricing. Since foundry price increases are being implemented gradually this year, the impact on our royalty revenue is expected to be reflected in the second half of the year.
Story Continues
Q: Could you share the company's development progress in AI-related projects, particularly in S-RAM repair applications? A: Michael He, President: Our OTP has long played an important role in S-RAM repair applications. We have integrated our technology with Siemens' software, offering a validated solution that simplifies the design process and accelerates customer adoption. We have multiple AI-related S-RAM repair design-ins, mainly focused on advanced node chips such as AI data center processors and memory controllers. As these designs move into mass production, we expect the related royalty contribution to become increasingly visible.
Q: Can you provide more details on the development of the company's 1T flash architecture and technology? A: Dr. Charles Xu, Chairman: The 1T NeoFlash adopts an innovative write architecture that overcomes the limitations of the conventional 2T design, significantly reducing the memory cell area. This flash technology is built on standard logic processes, supporting both embedded and standalone flash. It offers a shorter development cycle, low cost, higher yield, and greater manufacturing capability. We are cooperating with several foundries and fabless companies in its development.
Q: What are the key drivers of revenue growth this year? A: Michael He, President: Revenue growth is driven by upgrades of existing applications and the ramp-up of new applications. Product upgrades have led to higher ASPs, such as OLED DDI for foldable smartphones and PINMIC migration. New applications entering mass production include smartphone modem-related chips, AI CPUs, BMCs, and high-speed networking interface applications, which are expected to further support revenue growth.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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- eMemory Technology Inc (ROCO:3529) Q3 2025 Earnings Call Highlights: Record Revenue and ...
Nov 14, 2025
This article first appeared on GuruFocus.
Release Date: November 14, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
eMemory Technology Inc (ROCO:3529) achieved record high revenue in the third quarter of 2025. The company secured a 10-year contract for US government defense projects, marking a significant milestone for its PUF technology. eMemory Technology Inc's new EE technology has been designed into DDR5 modules, expected to enter mass production next year. The company has received multiple major customer engagements for NeoFlash and embedded IERAM technologies. eMemory Technology Inc is confident about its growth prospects for the next year and beyond, driven by new applications entering mass production.
Negative Points
The market has experienced recent volatility, affecting investor sentiment and external concerns. There are concerns about whether customer engagement and AI initiatives will move forward as planned. The company acknowledges that there are no shortcuts in its business model, requiring long-term efforts. Fluctuations in the capital market may impact the perception of the company's value. Despite progress, the company continues to face challenges in strengthening communication with investors to better recognize its true value.
Q & A Highlights
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Q: Can you elaborate on the recent breakthroughs in security applications and their significance? A: Dr. Charles Xu, Chairman: We have secured a 10-year contract with the US government for defense projects involving multiple 3 nanometer applications. This is a significant milestone for our PUF technology, marking its adoption in defense-related deployments. Our technology is now on a clear path toward larger-scale commercialization, supported by our partnership with the US Defense Advanced Research Project Agency since 2021.
Q: What advancements have been made in memory technology, and how do they impact the company's future? A: Dr. Charles Xu, Chairman: We have made significant progress in embedded non-volatile memory solutions, particularly with our new EE technology designed into DDR5 modules. This technology is expected to enter mass production next year, replacing the E2 problem used in DDR4. Additionally, we have received major customer engagements for NeoFlash and embedded IERAM, which will drive higher royalty income and demand for advanced process nodes.
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Q: How is eMemory Technology addressing market volatility and investor concerns? A: Michael Ho, President: Despite recent market volatility, our revenue and customer engagement continue to grow. We remain focused on strengthening our technology and customer value. We are committed to communicating our business progress to help the market understand our long-term potential and resilience.
Q: What are the company's growth prospects for the next year and beyond? A: Dr. Charles Xu, Chairman: We are confident about our growth prospects, driven by new applications entering mass production. These include AI chips, DDR5-related applications, AI servers, and automotive applications. Our security as a service business is also gaining traction, creating a strong competitive moat with a royalty-based recurring revenue model.
Q: How does eMemory Technology plan to maintain its competitive edge in the industry? A: Dr. Charles Xu, Chairman: We are focused on continuous innovation in our technology and IPs. Our long-term efforts in building foundational technologies and ecosystems have created a strong competitive moat. We will continue to enhance our security solutions, which have been in development for over a decade, to meet the growing demand for security.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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- eMemory Technology Inc (ROCO:3529) Q2 2025 Earnings Call Highlights: Revenue Growth Amid FX ...
Aug 16, 2025
Revenue: TWD937 million, up 2.7% sequentially and 4.9% year over year; USD30 million, up 7.1% sequentially and 7.3% year over year. Operating Expenses: TWD391 million, up 0.3% sequentially and down 1.8% year over year. Operating Income: TWD546 million, up 4.5% sequentially and 10.2% year over year. Operating Margin: 58.3%, increased by 1 percentage point sequentially and 2.8 percentage points year over year. Net Income: TWD400 million, down 13.4% sequentially and 15.8% year over year. EPS: TWD5.36. Licensing Revenue: 34% of total revenue, up 32.4% sequentially and 6.1% year over year. Royalty Revenue: 66% of total revenue, down 7.9% sequentially, up 4.3% year over year. NeoBit Licensing Revenue: 18.8% of total licensing revenue, up 5.6% sequentially, down 18.6% year over year. NeoFuse Licensing Revenue: 39.4% of total licensing revenue, up 6.3% sequentially and 25.5% year over year. PUF-based Security IP Licensing Revenue: 14.7% of total licensing revenue, up 176.3% sequentially and 24.7% year over year. MTP Technology Licensing Revenue: 27.1% of total licensing revenue, up 77% sequentially, down 3.1% year over year. 8-inch Wafer Royalties: 40% of royalties, down 13.4% sequentially and 2% year over year. 12-inch Wafer Royalties: 60% of royalties, down 3.8% sequentially, up 8.8% year over year. Product Tape-outs: 160 completed in the second quarter.
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Release Date: August 15, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
eMemory Technology Inc (ROCO:3529) reported a 7.1% increase in revenue in US dollars from the previous quarter and a 7.3% increase year over year. The company has achieved over 110 tape-outs related to security IP, indicating strong progress in their technology adoption. Licensing revenue increased significantly by 32.4% sequentially and 6.1% year over year, showing strong demand for their IPs. The company is advancing development on TSMC's N3P process and 2-nanometer technologies, positioning itself well for future growth. eMemory Technology Inc (ROCO:3529) has started receiving PUF-related royalties, which are expected to accelerate royalty growth momentum in the future.
Negative Points
Net income decreased by 13.4% sequentially and 15.8% year over year, impacted by a foreign exchange loss of around TWD90 million. The tape-out volume declined for the second consecutive quarter compared to the same period last year, particularly affecting consumer products. The company recorded FX losses in the second quarter, and exchange rates are expected to continue impacting financials in the third quarter. There is a current shortage in R&D capacity, primarily concerning the design and development of OTP and security IP for leading-edge process nodes. Operating performance has lagged behind TSMC due to slower ASP growth, especially in recent years, as TSMC's growth was driven by higher price leading-edge nodes.
Story Continues
Q & A Highlights
Q: Why has eMemory's operating performance lagged behind TSMC, and can growth catch up or surpass TSMC in the future? A: Michael Ho, General Manager, explained that eMemory's business model involves a long lead time from technology development to royalty contribution. The process from development to mass production and royalty generation can take several years. However, once adopted, a process node can generate royalties for over 20 years. The gap in performance is mainly due to slower ASP growth compared to TSMC's higher price leading-edge nodes. With rising customer demand for security, adoption is accelerating, and growth will be driven by both wafer volumes and higher royalties per wafer.
Q: Could the company see a reversal of FX losses in the third quarter? A: Joseph Hsia, Head of Finance, stated that exchange rates will continue to impact the company in the third quarter. The FX impact is mainly from converting US dollar-denominated revenue into New Taiwan dollar, exchange rate movements between revenue recognition and cash collection, and the revaluation of US dollar assets. The actual FX impact will depend on exchange rate movements throughout the quarter.
Q: Why did the tape-out volume decline for the second consecutive quarter compared to last year? A: Michael Ho noted that the decline was mainly in consumer products like DDI, PMIC, MCU, and sensors. The number of tape-outs for these categories does not follow a consistent pattern. However, there is a higher proportion of tape-outs at more advanced nodes below 28 nanometers, supporting a long-term upward trend in royalty ASP. The long-term trend for tape-out volume is expected to remain upward as foundries develop more process nodes.
Q: When will royalty contributions from PUF-related tape-outs begin? A: Chairman Ching-Hsiang Hsu mentioned that over 110 PUF-related tape-outs have been accumulated, covering a wide range of applications. Security IP requires a longer verification and integration cycle, but the stickiness is higher. Some customer applications have already entered mass production, and both license fees and royalties are expected to enter a period of rapid growth.
Q: How is the collaboration with ARM progressing? A: Ching-Hsiang Hsu stated that eMemory is part of the ARM chip data consortium and ARM CSS platform, with security supported by PUFrt. More chip adoption is expected in the 3-nanometer process for the second half, and the collaboration will continue down to the 2-nanometer process.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
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- eMemory Technology Inc (ROCO:3529) Q1 2025 Earnings Call Highlights: Strong Year-Over-Year ...
May 10, 2025
Revenue: TWD912 million, down 9.8% sequentially, up 13.6% year-over-year. Operating Expense: TWD389 million, down 12.5% sequentially, up 1.9% year-over-year. Operating Income: TWD522 million, down 7.7% sequentially, up 24.2% year-over-year. Operating Margin: Increased by 1.3% points sequentially and 4.9% points year-over-year to 57.3%. Net Income: TWD462 million, down 10.3% sequentially, up 7.2% year-over-year. EPS: TWD6.180 for the quarter. Licensing Revenue: 26.3% of total revenue, down 23.8% sequentially, up 5.2% year-over-year. Royalty Revenue: 73.7% of total revenue, down 3.4% sequentially, up 16.9% year-over-year. New Bit Licensing Revenue: 23.6% of total licensing revenue, down 14% sequentially, up 18.7% year-over-year. New Bit Royalty Revenue: 25.4% of total royalty, down 0.8% sequentially, up 20.2% year-over-year. New Fuels Licensing Revenue: 49.1% of total licensing revenue, down 4.3% sequentially, down 1.7% year-over-year. New Fuels Royalty Revenue: 72.4% of total royalties, down 4.4% sequentially, up 16.3% year-over-year. PA-based Security IPs Licensing Revenue: 7% of licensing revenue, down 76.4% sequentially, down 7.4% year-over-year. PA-based Security IPs Royalty Revenue: Less than 1% of total royalties, up 1.7% sequentially, up 542.2% year-over-year. MTP Technology Licensing Revenue: 20.3% of total licensing revenue, down 11.1% sequentially, up 14.9% year-over-year. MTP Technology Royalty Revenue: 2.1% of total royalties, up 0.2% sequentially, down 1.6% year-over-year. 8-inch Wafer Royalties: 42.5% of royalties, up 0.6% sequentially, up 16.1% year-over-year. 12-inch Wafer Royalties: 57.5% of royalties, down 6.2% sequentially, up 17.5% year-over-year. Product Tap-Outs: 137 completed in the first quarter.
Warning! GuruFocus has detected 5 Warning Signs with BOM:524669.
Release Date: May 09, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
eMemory Technology Inc (ROCO:3529) reported a year-over-year revenue increase of 13.6% for the first quarter of 2025. Operating income increased by 24.2% year-over-year, with an operating margin rising to 57.3%. The company is developing post-quantum cryptography (PQC) modules, expanding its portfolio to include a full suite of solutions for quantum migration. eMemory Technology Inc has joined the Intel Chiplet Alliance, enhancing its position in the semiconductor industry. The company is focusing on licensing-based business models, which could provide stable revenue streams without the need to sell physical products.
Story Continues
Negative Points
First quarter revenue decreased by 9.8% sequentially, indicating potential short-term challenges. Net income decreased by 10.3% sequentially due to reduced foreign exchange gains. Licensing revenue saw a sequential decline of 23.8%, highlighting potential volatility in this revenue stream. The company faces challenges from tariffs and exchange rate fluctuations, which could impact future profitability. PUF-related revenue experienced a notable decline in the first quarter, raising concerns about growth in this segment.
Q & A Highlights
Q: PUF-related revenue saw a notable decline in the first quarter. Do you expect it to grow this year? A: Charles Hsu, Chairman and Founder: Security-related IP, especially in advanced processes, requires integration from the outset, leading to longer timelines. Licensing revenue typically peaks in the fourth quarter and dips in the first. However, April and May have shown an uptick, suggesting growth throughout the year.
Q: Can you provide more information about the partnership between eMemory and Intel Foundry? A: Charles Hsu, Chairman and Founder: Our OTP and PUF-based hardware security supports Intel's 18A processes, crucial for high-performance products. We are part of Intel's Chiplet Alliance, enhancing security for chiplet technologies.
Q: What is the recent schedule update for the three-nanometer verification planned for 2025? A: Michael Ho, President: Our three-nanometer OTP has been integrated into customer designs, with several others in discussions and integration stages.
Q: How is eMemory preparing for the transition to two-nanometer GAA architecture? A: Michael Ho, President: With the decrease in supply voltage and absence of IO devices in the two-nanometer GAA process, we've adjusted our OTP design into smaller modules, validated on previous three-nanometer shuttles, to ensure successful launch.
Q: Have you implemented any foreign exchange risk management strategies due to the appreciation of the new Taiwan dollar? A: Michael Ho, President: We reduced exposure to US dollar holdings by converting payments promptly to the new Taiwan dollar. While revenue is impacted by currency conversion, our primary costs are in the new Taiwan dollar, minimizing the impact.
Q: How might tariffs indirectly affect overall royalty income? A: Michael Ho, President: While tariffs don't directly impact licensing, they could affect market demand and royalties. However, new customer applications in mass production will contribute, and we are focusing on advanced process platforms for future growth.
Q: Are you planning to enter the server sales business with the PUF-based server? A: Charles Hsu, Chairman and Founder: We developed the HSM AG server solution to provide high-level security functions without selling servers. We collect licensing fees and royalties, collaborating with manufacturers and cybersecurity companies.
Q: What is eMemory's niche in pursuing the PUF-based server business? A: Charles Hsu, Chairman and Founder: Our innovation is protected by patents covering system architecture for parallel processing and key management, providing a competitive advantage in the security-as-a-service ecosystem.
Q: How does the trend of localized semiconductor supply chains in the US and Europe influence PUF-based solutions? A: Charles Hsu, Chairman and Founder: PUF can verify chip identity and manufacturing origin, aligning with government mandates for traceability and secure supply chains, improving reliability and compliance.
Q: What are the competitive advantages of eMemory's PUF-based solutions in achieving a PQC security architecture? A: Charles Hsu, Chairman and Founder: Unlike others focusing on cryptography IP, we offer a complete rule of trust IP, providing greater integrity and resistance to attacks. Our solutions are widely applied in various fields, with adoption expected to grow as cybersecurity regulations advance.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
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- eMemory Technology Inc (ROCO:3529) Q4 2024 Earnings Call Highlights: Strong Revenue Growth Amid ...
Feb 14, 2025
Release Date: February 12, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
eMemory Technology Inc (ROCO:3529) reported a 12.4% increase in fourth-quarter revenue year over year, indicating strong financial performance. Net income rose by 27.5% year over year, showcasing effective cost management and profitability. The company is experiencing increased demand for its IPs, particularly in edge computing and AI applications, which are expected to drive future growth. eMemory Technology Inc (ROCO:3529) is well-positioned to capitalize on the transition to post-quantum cryptography, with its PQC IP solutions. The company has successfully expanded its licensing and royalty revenue, with a 22.5% and 16.4% increase respectively for the full year of 2024.
Negative Points
Operating margin decreased by 4% year over year, primarily due to rising salary and bonus expenses. There is a significant reliance on mature process royalties, which may face downward pressure due to increased capacity in China. The company faces challenges in maintaining high operating margins due to fluctuations in foreign exchange rates. Licensing revenue from certain technologies, such as NTP, decreased both sequentially and year over year. The company must navigate geopolitical factors as Europe, the US, and Japan expand their semiconductor capacities, potentially impacting regional operations.
Q & A Highlights
Q: What is your perspective on the year-over-year decrease in operating profit margin during the 4th quarter of last year and your outlook for future operating profit margins? A: More than 80% of our operating expense is employee salaries, and 30% of the salary expense is linked to employee profit sharing, which accounts for 15% of the pre-tax income. Since pre-tax income includes non-operating items, currency gains or losses related to our US dollar positions significantly impact it. The currency losses from Q4 2023 led to a decrease in pre-tax profit, reducing employee profit sharing expense and increasing the operating profit margin. In Q4 of last year, currency gains increased expenses, resulting in a 4% difference in operating margin year over year. Looking forward, we anticipate an upward trend in the overall operating margin. Michael Ho, President
Q: With the recent sharp decline in AI model cost, several CSPs and chip companies anticipate an acceleration in AI inference applications. What are your key advantages in the inference applications? A: The decrease in AI cost benefits edge computing applications. In edge AI, data training is used to establish an AI model, which is then used to infer possible results. This entire process, including the protection of input data, the model, and the generated results, requires hardware security IPs. We provide high-performance path-based security IPs to make edge AI applications safer and accelerate industry development. Michael Ho, President
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Q: Open Compute Project has defined Calyptra rule of trust as a recommendation for security architecture. E-memory has been preparing for this architecture for a long time. Could you elaborate on the revenue and profit contributions of related IPs? A: The three key components outlined in the Calyptra specification are the same three key features, OTP, and TRG, that our PART was developed to provide over four years ago. Consequently, starting in mid-2024, we have received inquiries from some customers regarding Calyptra. In the fourth quarter, several projects have already been licensed, and some are in the process of being finalized. Charles Xu, Chairman
Q: The current utilization rate for mature processes is generally below 70%, and with China expanding its mature process capacity, this will inevitably exert long-term downward pressure on foundry process prices. Since a significant portion of your royalties come from mature processes, how do you plan to address this issue? A: Our OTP and MTP are already industry standards and widely applied in mature processes for major applications such as display drivers, PI, ISP, and various sensors. As foundries expand their capacity, they will need to license our technology, which will increase our royalties. As existing customers transition to more advanced processes, royalties per chip will increase, offsetting the downward pressure on foundry prices due to oversupply. Michael Ho, President
Q: Security is a significant trend for decades, and numerous companies are providing cybersecurity software and services. How does your company fit into the broader security landscape? A: We offer hardware security solutions based on technology to protect data usage. While many security software and service companies use software for data encryption and security key generation, the use of software methods to secure data usage is easy to be attacked through the internet. For a system to be secure, secret keys must be generated randomly and stored in the hardware. Our cutting-edge technology combines both generation and storage of secret keys, providing the most secure foundation for security applications and ensuring data protection. Charles Xu, Chairman
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
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- eMemory Technology Inc (ROCO:3529) Q3 2024 Earnings Call Highlights: Strong Revenue Growth ...
Nov 9, 2024
Revenue: $899 million, up 0.7% sequentially and 14.3% year over year. Operating Expenses: $395 million, down 0.8% sequentially, up 6.7% year over year. Operating Income: $505 million, up 2% sequentially, up 21% year over year. Operating Margin: 56.1%, increased by 0.6% points sequentially and 3.1% points year over year. Net Income: $414 million, down 12.9% sequentially, up 2% year over year. EPS: $5.54. Return on Equity (ROE): 54.6%. Licensing Revenue: 32.3% of total revenue, down 3% sequentially, up 12.2% year over year. Royalty Revenue: 67.7% of total revenue, up 2.6% sequentially, up 15.3% year over year. NeoBit Licensing Revenue: 31.2% of total licensing revenue, up 23.2% sequentially, up 27.8% year over year. NeoFuse Licensing Revenue: 30.9% of total licensing revenue, down 10.1% sequentially, down 9.7% year over year. MTP Technology Licensing Revenue: 25.9% of total licensing revenue, down 15.3% sequentially, up 139.5% year over year. 8-inch Wafer Royalties: 40.9% of royalties, down 1.2% sequentially, up 30% year over year. 12-inch Wafer Royalties: 59.1% of royalties, up 5.5% sequentially, up 7% year over year.
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Release Date: November 08, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
eMemory Technology Inc (ROCO:3529) successfully completed its first three nanometer customer license project, marking a significant milestone. The company reported a 14.3% year-over-year increase in third-quarter revenue, reaching $899 million. Operating income increased by 21% year over year, with an operating margin of 56.1%. The collaboration with Siemens on SSRM repair is progressing well, enhancing repair capabilities for high-performance computing customers. eMemory Technology Inc (ROCO:3529) is advancing its technology development to two nanometers, with successful design wins at various nanometer levels entering mass production.
Negative Points
Net income decreased by 12.9% sequentially, despite a 2% year-over-year increase. Licensing revenue in the third quarter accounted for 32.3% of total revenue, down 3% sequentially. Path-based security IP licensing revenue decreased by 6.5% sequentially and 39% year over year. The company faces challenges in maintaining high density in AI accelerators, which requires innovative solutions. There is a need for new talent to develop IPs in areas like security systems, indicating potential resource constraints.
Q & A Highlights
Q: Why was it necessary to partner with an EDA company like Siemens for the SRM repair tool release? A: Charles Xu, Chairman: Through our collaboration with EDA companies, we have developed OTP with an appropriate interface that integrates seamlessly into EDA tools, making OTP repair more user-friendly. Siemens' building self-test holds over 90% of the market share, making our partnership a powerful alliance.
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Q: What factors have contributed to the ongoing growth of your operating profit margin, and will there be a need to expand your R&D team? A: Michael Ho, General Manager: Our unique business model involves licensing technologies to foundries, with over 80% of revenue from royalties. This allows us to focus R&D on new technologies. We may need new talent for specific areas like security systems, but any headcount increase will be gradual.
Q: Has eMemory's business been affected by the current economic environment, given that several ASIC companies in Taiwan have downgraded their revenue outlooks? A: Michael Ho, General Manager: Our unique business model and deep technology expertise mean we are not subject to price competition. Our IPs have a 100% retention rate, and we hold a leading position in the field, which shields us from economic downturns.
Q: What is the current status of your collaboration with Arm, and how will it impact your future operations? A: Charles Xu, Chairman: Our collaboration with Arm focuses on hardware security. We jointly promote IP to customers and conduct educational outreach. As customers adopt our IP, licensing and royalties will increase, contributing to future growth.
Q: How will the trend of high-demand chips being developed using more advanced processes affect your company's business? A: Michael Ho, General Manager: This trend is favorable for us as it means larger IC chips and higher unit prices in advanced processes, driving continuous growth in our royalties and licensing fees.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
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- eMemory Technology Inc (ROCO:3529) Q2 2024 Earnings Call Highlights: Robust Revenue Growth and ...
Oct 9, 2024
Revenue: TWD893 million, up 11.2% sequentially and 28.2% year over year. Operating Expenses: TWD398 million, up 4.1% sequentially and 21.3% year over year. Operating Income: TWD495 million, up 17.7% sequentially and 34.3% year over year. Operating Margin: 55.5%, increased by 3.1 percentage-points sequentially and 2.6 percentage-points year over year. Net Income: TWD475 million, up 10.3% sequentially and 35.1% year over year. EPS: TWD6.36. ROE: 67.3%. Licensing Revenue: 33.6% of total revenue, up 31.3% sequentially and 20% year over year. Royalty Revenue: 66.4% of total revenue, up 3.3% sequentially and 32.8% year over year. NeoBit Licensing Revenue: 24.6% of total licensing revenue, up 54% sequentially and 30.2% year over year. NeoFuse Licensing Revenue: 33.3% of total licensing revenue, down 16.7% sequentially and 11.9% year over year. PUF-Based Security IP Licensing Revenue: 12.5% of licensing revenue, up 105.2% sequentially and 36% year over year. MTP Technology Licensing Revenue: 29.6% of total licensing revenue, up 110% sequentially and 69.9% year over year. 8-inch Wafer Royalties: 42.5% of royalties, up 2.6% sequentially and 26.7% year over year. 12-inch Wafer Royalties: 57.5% of royalties, up 3.8% sequentially and 37.6% year over year. Product Tape-Outs: 171 completed in the second quarter.
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Release Date: August 07, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
eMemory Technology Inc (ROCO:3529) reported a significant increase in revenue, with a 28.2% year-over-year growth in the second quarter of 2024. The company's operating margin improved to 55.5%, reflecting a 3.1 percentage-point increase sequentially. Licensing revenue saw a substantial rise, accounting for 33.6% of total revenue, up 31.3% sequentially. The PUF-Based Security IPs experienced a remarkable 105.2% sequential increase in licensing revenue. eMemory Technology Inc (ROCO:3529) is developing new IP technologies, including NeoFuse for FinFET HV processes and RRAM, to meet growing customer demands.
Negative Points
NeoFuse licensing revenue decreased by 16.7% sequentially and 11.9% year over year. PUF's royalty contributions remain low, accounting for less than 1% of total royalties. The company faces challenges due to US government sanctions affecting royalty collections from Chinese customers. Despite advancements, major high-performance computing vendors have not yet widely adopted eMemory's TRNG technology. The competitive landscape, including price-cutting among Chinese foundries, poses potential risks to eMemory's market position.
Story continues
Q & A Highlights
Q: How has the price-cutting competition among Chinese foundries affected eMemory? A: Michael Ho, President: Despite the price-cutting competition, eMemory benefits from China's expansion of production capacity and increased penetration of our NVM technologies. This expansion is expected to drive overall growth in royalties, even if foundry wafer prices decline.
Q: Will Trump's statement about TSMC paying the US for protection impact eMemory? A: Michael Ho, President: eMemory's IP is licensed globally, including in the US with companies like Intel and Global Foundries. Our widespread technology platforms make us less susceptible to political influences.
Q: Are customers incorporating AI capabilities into their designs, and how does this affect eMemory? A: Michael Ho, President: Yes, customers are incorporating AI functions, moving to advanced processes for applications like recognition and image processing. Our IPs are used in data input, storage, and computing, driving future licensing and royalty growth.
Q: Why haven't major high-performance computing vendors used eMemory's True Random Number Generator (TRNG) if it's the fastest? A: Charles Hsu, Chairman: Our TRNG is based on OTP and PUF technologies and must be qualified in each process. As more customers adopt our technology and hackers use faster computing, the demand for faster random number generators will grow. We are promoting this technology with CPU partners.
Q: What is the reason for the slow increase in PUF's royalties? A: Charles Hsu, Chairman: Licensing for PUF technology is increasing, but US government sanctions on our first customer, China's largest chip company, affected royalties. However, over 60 tape-outs are entering mass production and will soon contribute to royalties.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
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