Falling Shares and Continued Net Loss
GSI Technology Inc. (NASDAQ: GSIT) experienced a 3.7% drop in shares on Friday following the release of its fiscal second-quarter financial results. The memory specialist reported a net loss of $4.06 million, or 16 cents per share. This represents an increase from the net loss of $3.23 million, or 13 cents per share, in the same quarter last year. It is important to note that the company has now reported a net loss for more than twelve consecutive quarters.
Revenue Performance and Challenging Year-over-Year Comparison
Despite the net loss, GSI Technology reported revenue of $5.71 million for the second quarter. While this falls at the higher end of the company’s guidance, it is a decrease from the $8.95 million in revenue generated during the same period in the previous year. GSI Technology CEO Lee-Lean Shu acknowledged the challenging year-over-year comparison due to boosted revenue from inventory builds with key customers.
Decline in Gross Margin and Future Expectations
GSI Technology’s gross margin for the second quarter was 54.7%, down from the 62.6% reported in the prior year’s quarter.
Looking ahead to the fiscal third quarter, GSI Technology anticipates revenue ranging from $5.4 million to $6.2 million, with a projected gross margin of approximately 55% to 57%.
Spotlight on Gemini-II Processor for AI Applications and Aerospace Market
Earlier this year, GSI Technology attracted meme-like attention as users on Reddit discussed the company’s AI-processor technology. Following this buzz, GSI Technology recently announced completion of the design for its Gemini-II processor, which is specifically targeted at the artificial intelligence market.
The company sees potential for the Gemini-II processor in various AI applications as well as the aerospace market, specifically emphasizing its compatibility with drones, satellites, and aircraft.
Stock Performance for GSI Technology
Despite the challenges faced, GSI Technology’s stock has experienced a noteworthy increase of 34.1% in 2023. This outperforms the gain of 7.8% recorded by the S&P 500 index.
Overall, GSI Technology remains focused on navigating the market landscape and capitalizing on opportunities in the AI and aerospace sectors with its innovative Gemini-II processor.