Silicon Motion Posts Record Sales of $560.2 Million in Third Quarter
Key Facts
Silicon Motion reported net sales of $560.2 million in the third quarter of 2026, up 24% from the previous quarter and 131% from the same period a year earlier, beating market estimates by $31.1 million. Meanwhile, diluted earnings per American depositary share were $1.91 under GAAP, $1.15 below estimates, according to data cited by Seeking Alpha. The same metric was $4.35 under Non-GAAP, highlighting the gap between the two profitability measures in the results. Gross margin was 53.6% under GAAP and 53.7% under Non-GAAP. Operating margin was 29.0% and 32.1%, respectively, according to a summary of the company’s release published via GlobeNewswire.
Sales came in above the company’s range for the quarter. In July, it forecast revenue of between $519 and $541 million, with quarter-over-quarter growth of between 15% and 20% and year-over-year growth of between 114% and 124%. Sales were $451.0 million in the second quarter, compared with $560.2 million in the third quarter. GAAP diluted earnings per American depositary share also fell from $3.99 in the second quarter to $1.91 in the third quarter, according to the figures reported for the two periods. On a year-over-year basis, second-quarter 2025 revenue was about $198.7 million, while the company reported GAAP diluted earnings of $0.49 per American depositary share. The annual comparison shows revenue growth, while whether earnings beat estimates depends on the measure used: GAAP earnings came in below estimates, and no separate estimate comparison is available here for the Non-GAAP figure.
Growth in solid-state drive (SSD) controllers drove part of the sales expansion, with sales rising between 20% and 25% quarter over quarter and between 55% and 60% year over year. By contrast, sales of eMMC and UFS controllers fell between 10% and 15% from the previous quarter, despite rising between 35% and 40% year over year. Ferri solutions and boot drives posted an increase of between 75% and 80% quarter over quarter. Year over year, sales of these solutions surged between 2,580% and 2,585%, according to the company summary published via GlobeNewswire. The differing trends across categories show that overall growth coincided with a quarterly decline in eMMC and UFS, alongside growth in SSD, Ferri solutions and boot drives.
The company said in July that its outlook was based on backlog orders and customer forecasts, and that it expected revenue to continue growing strongly through the rest of the year. Management then pointed to headwinds in some consumer activities from NAND pricing and supply. Chief Executive Wallace Kou said, "The first and second quarters provided a record start to the year, and we expect this momentum to continue in the second half." The company also said it was on track to post the highest annual revenue in its history, with growth exceeding 100% in 2026. The third-quarter results put that outlook in the context of strong quarterly and annual growth, while management’s comments on demand drivers and its expectations for the rest of the year are scheduled for the next results call.
SIMO shares closed at $204.17 on October 27, after closing at $189.18 on October 26, according to EL7 data. On October 16, the company announced an annual cash distribution of $2.30 per depositary share, up 15% from the $2.00 announced in 2025. The distribution is payable in four quarterly installments of $0.575 per depositary share each. The company scheduled a call to discuss its third-quarter results for October 29, 2026, at 8:00 a.m. Eastern time. The call is expected to give management an opportunity to discuss the results in detail and its outlook for the coming period.