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Revenue of $104.1 million was down 5.7% sequentially and down 15.4% year-over-year (YoY). The decrease was mainly due to a 29.3% sequential decline in Display solutions revenue as a result of continued severe supply shortage of 28nm 12″ OLED wafers, partially offset by record revenue in our Power solutions business, which was up 11.4% sequentially and 20.0% YoY on strong demand in premium products.
Gross profit margin was 37.5%, up 250 basis points from Q4 and up over 960 basis points from Q1 a year ago. The YoY increase was primarily attributable to an improved product mix, combined with an increase in average selling price under a favorable pricing environment. Sequentially, Q1 benefited by approximately 200 basis points from the timing mismatch of lower cost 12″ wafers purchased in a prior period and sold in Q1.
GAAP diluted earnings per share (EPS) was $0.20.
Non-GAAP diluted EPS was $0.28.

SEOUL, South Korea, May 3, 2022 – Magnachip Semiconductor Corporation (NYSE: MX) (“Magnachip” or the “Company”) today announced financial results for the first quarter of 2022.

Commenting on the results for the first quarter of 2022, YJ Kim, Magnachip’s chief executive officer stated, “In Q1, we reported revenue of $104.1 million and non-GAAP EPS of 28 cents, which was an increase of 27% year-over-year bolstered by a strong gross profit margin. As expected, OLED revenue remained severely impacted by the shortage of 28nm 12-inch wafer supply; however, this impact was somewhat offset by strength in our Power solutions business, which achieved yet another record quarterly revenue.”

YJ Kim continued, “Looking forward, the ongoing lockdowns in China has added new challenges to an already stressed supply chain. Despite the current macro issues, which may limit our near-term growth, our recent design tractions with an existing OLED customer, broadening customer base, and new wafer capacity later this year give us confidence and optimism about our long-term growth.”

Q1 2022 Financial Highlights


	In thousands of U.S. dollars, except share data
	GAAP
	Q1 2022		Q4 2021			Q/Q change					Q1 2021			Y/Y change
Revenues
Standard Products Business
Display Solutions	29,185			41,298			down	29.3	%			58,895			down	50.4	%
Power Solutions	64,825			58,212			up	11.4	%			54,011			up	20.0	%
Transitional Fab 3 foundry services⁽¹⁾	10,083			10,825			down	6.9	%			10,113			down	0.3	%
Gross Profit Margin	37.5	%		35.0	%		up	2.5	%	pts		27.9	%		up	9.6	%	pts
Operating Income (Loss)⁽²⁾	12,879			63,870			down	79.8	%			(2,091)			up	n/a
Net Income (Loss)	9,528			53,611			down	82.2	%			(7,473)			up	n/a
Basic Earnings (Loss) per Common Share	0.21			1.16			down	81.9	%			(0.19)			up	n/a
Diluted Earnings (Loss) per Common Share	0.20			1.12			down	82.1	%			(0.19)			up	n/a

	In thousands of U.S. dollars, except share data
	Non-GAAP⁽³⁾
	Q1 2022		Q4 2021			Q/Q change					Q1 2021			Y/Y change
Adjusted Operating Income	14,517			14,421			up	0.7	%			9,971			up	45.6	%
Adjusted EBITDA	18,755			18,144			up	3.4	%			13,504			up	38.9	%
Adjusted Net Income	12,936			14,606			down	11.4	%			9,346			up	38.4	%
Adjusted Earnings per Common Share—Diluted	0.28			0.31			down	9.7	%			0.22			up	27.3	%


(1)	Following the consummation of the sale of the Foundry Services Group business and Fab 4 in Q3 2020, and for a period of up to three years, we will provide transitional foundry services to the buyer for foundry products manufactured in our fabrication facility located in Gumi (“Transitional Fab 3 Foundry Services”). Management believes that disclosing revenue of Transitional Fab 3 Foundry Services separately from the standard products business allows investors to better understand the results of our core standard products display solutions and power solutions businesses.
(2)	For the three months ended December 31, 2021, operating income of $63.9 million included net gain of $49.4 million that represented $70.2 million income from the recognition of a reverse termination fee, net of professional service fees and expenses of $20.8 million incurred in connection with the contemplated merger transaction.
(3)	Management believes that non-GAAP financial measures, when viewed in conjunction with GAAP results, can provide a meaningful understanding of the factors and trends affecting our business and operations and assist in evaluating our core operating performance. However, such non-GAAP financial measures have limitations and should not be considered as a substitute for net income (loss) or as a better indicator of our operating performance than measures that are presented in accordance with GAAP. A reconciliation of GAAP results to non-GAAP results is included in this press release.

Q2 2022 Financial Guidance
Our near-term outlook is still being challenged by persisting supply constraints, especially for 28nm 12″ wafers. While actual results may vary, looking into the next quarter, Magnachip currently expects:

Revenue to be in the range of $100 million to $105 million, including about $9.5 million of Transitional Fab 3 Foundry Services.
Gross profit margin to be in the range of 33% to 35%.

Q1 2022 Earnings Conference Call
Magnachip will host a corresponding conference call at 2:00 p.m. PT / 5:00 p.m. ET on May 3, 2022 to discuss its financial results. The conference call will be webcast live and also is available by dialing toll-free at 1-844-536-5472 in US/Canada. International call-in participants can dial 1-614-999-9318. The conference ID number is 2619959. Participants are encouraged to initiate their calls at least 10 minutes in advance of the start time to ensure a timely connection. A live and archived webcast of the conference call and a copy of earnings release will be accessible from the ‘Investors’ section of the company’s website at www.magnachip.com. A replay of the conference call will be available until 8:00 p.m. ET on May 10, 2022. The replay dial-in numbers are 1-404-537-3406 or toll-free at 1-855-859-2056. The conference ID number is 2619959.

Safe Harbor for Forward-Looking Statements
Information in this release regarding Magnachip’s forecasts, business outlook, expectations and beliefs are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. These statements include expectations about estimated historical or future operating results and financial performance, outlook and business plans, including second quarter 2022 revenue and gross profit margin expectations, and the impact of the COVID-19 pandemic or the emergence of various variants of the virus, escalated trade tensions and supply constraints on Magnachip’s second quarter 2022 and future operating results. All forward-looking statements included in this release are based upon information available to Magnachip as of the date of this release, which may change, and we assume no obligation to update any such forward-looking statements. These statements are not guarantees of future performance and actual results could differ materially from our current expectations. Factors that could cause or contribute to such differences include, among others: the impact of changes in macroeconomic and/or general economic conditions, including those caused by or related to the COVID-19 pandemic or the emergence of various variants of the virus and governmental lock-downs or other measures implemented in response thereto, other outbreaks of disease, the Russia-Ukraine crisis, recessions, economic instability or civil unrest; manufacturing capacity constraints or supply chain disruptions that may impact our ability to deliver our products or affect the price of components, which may lead to an increase in our costs, as well as impacting demand for our products from customers who are similarly affected by such capacity constraints or disruptions; the impact of competitive products and pricing; timely design acceptance by our customers; timely introduction of new products and technologies; ability to ramp new products into volume production; industry wide shifts in supply and demand for semiconductor products; industry and/or company overcapacity or supply constraints; effective and cost efficient utilization of manufacturing capacity; financial stability in foreign markets and the impact of foreign exchange rates; unanticipated costs and expenses or the inability to identify expenses which can be eliminated; compliance with U.S. and international trade and export laws and regulations by us, our customers and our distributors, including those related to the Russia-Ukraine crisis; change or ratification of local or international laws and regulations, including those related to environment, health and safety; public health issues, including the COVID-19 pandemic or the emergence of various variants of the virus; other business interruptions that could disrupt supply or delivery of, or demand for, Magnachip’s products, including uncertainties regarding the impacts of the COVID-19 pandemic or the emergence of various variants of the virus that may result in factory closures, reduced workforces, scarcity of raw materials and goods produced in infected areas, as well as reduced consumer and business spending affecting demand for Magnachip’s products due to government and private sector mandatory business closures, travel restrictions or the like to prevent the spread of disease; and other risks detailed from time to time in Magnachip’s filings with the U.S. Securities and Exchange Commission (the “SEC”), including our Form 10-K filed on February 23, 2022 (including that the impact of the COVID-19 pandemic or the emergence of various variants of the virus, trade tensions and supply constraints may also exacerbate the risks discussed therein) and subsequent registration statements, amendments or other reports that we may file from time to time with the SEC and/or make available on our website. Magnachip assumes no obligation and does not intend to update the forward-looking statements provided, whether as a result of new information, future events or otherwise.

About Magnachip Semiconductor
Magnachip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, computing, industrial and automotive applications. The Company provides a broad range of standard products to customers worldwide. Magnachip, with more than 40 years of operating history, owns a portfolio of approximately 1,150 registered patents and pending applications, and has extensive engineering, design and manufacturing process expertise. For more information, please visit www.magnachip.com. Information on or accessible through Magnachip’s website is not a part of, and is not incorporated into, this release.

CONTACTS:
Yujia Zhai
The Blueshirt Group
Tel. (860) 214-0809
Yujia@blueshirtgroup.com

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands of U.S. dollars, except share data)
(Unaudited)


		Three Months Ended
	March 31,				December 31,				March 31,
	2022				2021				2021
Revenues:
Net sales – standard products business		$	94,010			$	99,510			$	112,906
Net sales – transitional Fab 3 foundry services			10,083				10,825				10,113
Total revenues			104,093				110,335				123,019
Cost of sales:
Cost of sales – standard products business			56,080				62,206				79,247
Cost of sales – transitional Fab 3 foundry services			9,017				9,525				9,390
Total cost of sales			65,097				71,731				88,637
Gross profit			38,996				38,604				34,382
Gross profit as a percentage of standard products business net sales			40.3	%			37.5	%			29.8	%
Gross profit as a percentage of total revenues			37.5	%			35.0	%			27.9	%
Operating expenses:
Selling, general and administrative expenses			14,163				13,255				12,634
Research and development expenses			11,954				12,197				13,423
Merger-related costs (income), net			—				(49,369)				9,831
Other charges, net			—				(1,349)				585
Total operating expenses (income)			26,117				(25,266)				36,473
Operating income (loss)			12,879				63,870				(2,091)
Interest expense			(111)				(132)				(1,041)
Foreign currency gain (loss), net			(690)				147				(4,671)
Other income, net			933				947				620
Income (loss) before income tax expense			13,011				64,832				(7,183)
Income tax expense			3,483				11,221				290
Net income (loss)		$	9,528			$	53,611			$	(7,473)
Basic earnings (loss) per common share—		$	0.21			$	1.16			$	(0.19)
Diluted earnings (loss) per common share—		$	0.20			$	1.12			$	(0.19)
Weighted average number of shares—
Basic			45,603,208				46,369,520				40,292,838
Diluted			46,693,294				47,691,816				40,292,838

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands of U.S. dollars, except share data)
(Unaudited)


	March 31, 2022		December 31, 2021
Assets
Current assets
Cash and cash equivalents		$ 284,921		$ 279,547
Accounts receivable, net		51,208		50,954
Inventories, net		36,947		39,370
Other receivables		26,121		25,895
Prepaid expenses		9,124		7,675
Hedge collateral		4,060		3,060
Other current assets		9,262		2,619
Total current assets		421,643		409,120
Property, plant and equipment, net		102,675		107,882
Operating lease right-of-use assets		3,719		4,275
Intangible assets, net		2,203		2,377
Long-term prepaid expenses		6,771		8,243
Deferred income taxes		40,246		41,095
Other non-current assets		10,608		10,662
Total assets		$ 587,865		$ 583,654
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable		$ 37,566		$ 37,593
Other accounts payable		7,707		6,289
Accrued expenses		20,573		20,071
Accrued income taxes		9,361		11,823
Operating lease liabilities		2,223		2,323
Other current liabilities		6,989		7,382
Total current liabilities		84,419		85,481
Accrued severance benefits, net		32,572		33,064
Non-current operating lease liabilities		1,496		1,952
Other non-current liabilities		8,216		10,395
Total liabilities		126,703		130,892
Commitments and contingencies
Stockholders’ equity
Common stock, $0.01 par value, 150,000,000 shares authorized, 56,225,441 shares issued and 44,894,385 outstanding at March 31, 2022 and 55,905,320 shares issued and 45,659,304 outstanding at December 31, 2021		562		559
Additional paid-in capital		261,830		241,197
Retained earnings		353,070		343,542
Treasury stock, 11,331,056 shares at March 31, 2022 and 10,246,016 shares at December 31, 2021, respectively		(148,523 )		(130,306 )
Accumulated other comprehensive loss		(5,777 )		(2,230 )
Total stockholders’ equity		461,162		452,762
Total liabilities and stockholders’ equity		$ 587,865		$ 583,654

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands of U.S. dollars)
(Unaudited)


	Three Months Ended
	March 31, 2022	March 31, 2021
Cash flows from operating activities
Net income (loss)	$ 9,528	$ (7,473 )
Adjustments to reconcile net income (loss) to net cash provided by operating activities
Depreciation and amortization	3,891	3,448
Provision for severance benefits	1,670	1,771
Amortization of debt issuance costs and original issue discount	—	261
Loss on foreign currency, net	6,380	14,873
Provision for inventory reserves	145	1,504
Stock-based compensation	1,638	1,646
Other, net	161	154
Changes in operating assets and liabilities
Accounts receivable, net	(1,213 )	9,794
Inventories	1,456	6,071
Other receivables	667	(1,438 )
Other current assets	(6,829 )	5,427
Accounts payable	538	(7,701 )
Other accounts payable	(702 )	1,570
Accrued expenses	187	2,393
Accrued income taxes	(2,346 )	(10,700 )
Other current liabilities	(711 )	1,087
Other non-current liabilities	(73 )	18
Payment of severance benefits	(1,389 )	(1,493 )
Other, net	(178 )	12
Net cash provided by operating activities	12,820	21,224
Cash flows from investing activities
Proceeds from settlement of hedge collateral	1,829	—
Payment of hedge collateral	(2,891 )	—
Purchase of property, plant and equipment	(944 )	(1,082 )
Payment for intellectual property registration	(59 )	(171 )
Other, net	(77 )	(111 )
Net cash used in investing activities	(2,142 )	(1,364 )
Cash flows from financing activities
Proceeds from exercise of stock options	1,781	2,538
Acquisition of treasury stock	(830 )	(1,540 )
Repayment of financing related to water treatment facility arrangement	(134 )	(144 )
Repayment of principal portion of finance lease liabilities	(16 )	(16 )
Net cash provided by financing activities	801	838
Effect of exchange rates on cash and cash equivalents	(6,105 )	(10,444 )
Net increase in cash and cash equivalents	5,374	10,254
Cash and cash equivalents at beginning of period	279,547	279,940
Cash and cash equivalents at end of period	$ 284,921	$ 290,194

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES
RECONCILIATION OF OPERATING INCOME (LOSS) TO ADJUSTED OPERATING INCOME
(In thousands of U.S. dollars)
(Unaudited)

		Three Months Ended
	March 31,			December 31,			March 31,
	2022			2021			2021
Operating income (loss)		$	12,879		$	63,870		$	(2,091)
Adjustments:
Equity-based compensation expense			1,638			1,648			1,646
Inventory reserve related to Huawei impact of downstream trade restrictions			—			(379)			—
Merger-related costs (income), net			—			(49,369)			9,831
Other charges, net			—			(1,349)			585
Adjusted Operating Income		$	14,517		$	14,421		$	9,971

We present Adjusted Operating Income as a supplemental measure of our performance. We define Adjusted Operating Income for the periods indicated as operating income (loss) adjusted to exclude (i) Equity-based compensation expense, (ii) Inventory reserve related to Huawei impact of downstream trade restrictions, (iii) Merger-related costs (income), net and (iv) Other charges, net.

For the three months ended December 31, 2021, we recorded in our consolidated statement of operations net gain of $49,369 thousand that represented income of $70,200 thousand from the recognition of a reverse termination fee, net of professional service fees and expenses of $20,831 thousand incurred in connection with the contemplated merger transaction of the Company that was terminated in December 2021. For the same period, we also recorded $1,419 thousand gain on sale of certain legacy equipment of the closed back-end line in our fabrication facility in Gumi (which was closed during the year ended December 31, 2018), partially offset by $70 thousand of non-recurring expenses incurred in connection with the regulatory requests.

For the three months ended March 31, 2021, we recorded $9,831 thousand non-recurring professional service fees and expenses incurred in connection with the contemplated merger transaction. For the same period, we also recorded $585 thousand non-recurring professional service fees and expenses incurred in connection with the regulatory requests.

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES

RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA AND ADJUSTED NET INCOME

(In thousands of U.S. dollars, except share data)

(Unaudited)


	Three Months Ended
	March 31,		December 31,		March 31,
	2022		2021		2021
Net income (loss)	$	9,528	$	53,611	$	(7,473)
Adjustments:
Interest expense (income), net		(604)		(726)		420
Income tax expense		3,483		11,221		290
Depreciation and amortization		3,891		3,663		3,448
EBITDA		16,298		67,769		(3,315)
Equity-based compensation expense		1,638		1,648		1,646
Foreign currency loss (gain), net		690		(147)		4,671
Derivative valuation loss (gain), net		129		(29)		86
Inventory reserve related to Huawei impact of downstream trade restrictions		—		(379)		—
Merger-related costs (income), net		—		(49,369)		9,831
Other charges, net		—		(1,349)		585
Adjusted EBITDA	$	18,755	$	18,144	$	13,504
Net income (loss)	$	9,528	$	53,611	$	(7,473)
Adjustments:
Equity-based compensation expense		1,638		1,648		1,646
Foreign currency loss (gain), net		690		(147)		4,671
Derivative valuation loss (gain), net		129		(29)		86
Inventory reserve related to Huawei impact of downstream trade restrictions		—		(379)		—
Merger-related costs (income), net		—		(49,369)		9,831
Other charges, net		—		(1,349)		585
GAAP and cash tax expense difference		—		907		—
Income tax effect on non-GAAP adjustments		951		9,713		—
Adjusted Net Income	$	12,936	$	14,606	$	9,346
Adjusted Net Income per common share—
– Basic	$	0.28	$	0.31	$	0.23
– Diluted	$	0.28	$	0.31	$	0.22
Weighted average number of shares – basic		45,603,208		46,369,520		40,292,838
Weighted average number of shares – diluted		46,693,294		47,691,816		47,470,416

We present Adjusted EBITDA and Adjusted Net Income as supplemental measures of our performance. We define Adjusted EBITDA for the periods indicated as EBITDA (as defined below), adjusted to exclude (i) Equity-based compensation expense, (ii) Foreign currency loss (gain), net, (iii) Derivative valuation loss (gain), net, (iv) Inventory reserve related to Huawei impact of downstream trade restrictions, (v) Merger-related costs (income), net and (vi) Other charges, net. EBITDA for the periods indicated is defined as net income (loss) before interest expense (income), net, income tax expense and depreciation and amortization.

We prepare Adjusted Net Income by adjusting net income (loss) to eliminate the impact of a number of non-cash expenses and other items that may be either one time or recurring that we do not consider to be indicative of our core ongoing operating performance. We believe that Adjusted Net Income is particularly useful because it reflects the impact of our asset base and capital structure on our operating performance. We define Adjusted Net Income for the periods as net income (loss), adjusted to exclude (i) Equity-based compensation expense, (ii) Foreign currency loss (gain), net, (iii) Derivative valuation loss (gain), net, (iv) Inventory reserve related to Huawei impact of downstream trade restrictions, (v) Merger-related costs (income), net, (vi) Other charges, net, (vii) GAAP and cash tax expense difference and (viii) Income tax effect on non-GAAP adjustments.

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SOURCE Magnachip Semiconductor Corporation

– Low R_DS(on) of 40V MOSFET enables efficient control of BLDC motors

– Magnachip expands automotive business, intends to increase market share globally

SEOUL, South Korea, April 28, 2022 – Magnachip Semiconductor Corporation (“Magnachip”) (NYSE: MX) announced today that the company has released a new 40V Metal-Oxide-Semiconductor Field-Effect Transistor (MOSFET) to control Brushless Direct Current (BLDC) motors for automotive applications.

Magnachip Introduces a new 40V MOSFET to Control BLDC Motors for Automotive Applications

Given concerns about global climate change and corresponding efforts to reduce carbon emissions, the Electric Vehicle (EV) market is projected to grow significantly. Omdia, a global market research firm estimates that the global EV market is expected to grow 27% annually between 2022 and 2025. As such, demand for high-efficiency and durable BLDC motors for EVs will increase and Medium Voltage (MV) MOSFETs are essential for BLDC motors to operate efficiently. Magnachip has developed a new 40V MOSFET featuring low R_DS(on)* to reduce the conduction loss of automotive BLDC motors and the company began mass production of this new MOSFET in April 2022.

As reliable automotive semiconductors are critical to vehicle safety, the new 40V MOSFET is fully AEC-Q101 (Automotive Electronics Council-Q101) certified. The first application of this new product is for the Electric Water Pump of a new EV model from a global auto manufacturer. This MOSFET is also suitable for a variety of BLDC applications, such as electric oil pumps, engine cooling fans, electric power steering and battery cooling fans.

Magnachip continues to expand its market share in the automotive semiconductor sector with new products and advanced technology. Further, Magnachip is becoming a stable supplier of power semiconductor products as an integrated device manufacturer amid global supply chain disruptions affecting the automotive semiconductor industry, which is forecast to last through 2023.

“The market for both electric and internal combustion engines in the automotive sector is more competitive than ever and the demand for high-performance MV MOSFETs is increasing rapidly,” said YJ Kim, CEO of Magnachip. “Accordingly, we are strengthening our presence in global markets and believe the release of this new 40V MOSFET will help us to secure greater market share.”

*R_DS(on): On resistance, the resistance value between the drain and the source of MOSFETs during on-state operation

Related Link

MV MOSFETs – 40V

About Magnachip Semiconductor

Magnachip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, computing, industrial and automotive applications. The Company provides a broad range of standard products to customers worldwide. Magnachip, with more than 40 years of operating history, owns a portfolio of approximately 1,150 registered patents and pending applications, and has extensive engineering, design and manufacturing process expertise. For more information, please visit www.magnachip.com. Information on or accessible through Magnachip’s website is not a part of, and is not incorporated into, this release.

CONTACTS:

United States (Investor Relations):
Yujia Zhai
The Blueshirt Group
Tel. +1-860-214-0809
investor.relations@maganachip.com

United States (Investor Relations):
So-Yeon Jeong
Jeong Consulting
Tel. +1-408-712-6151
investor.relations@maganachip.com

USA media / industry analysts:
Mike Newsom
LouVan Communications, Inc.
Tel. +1-617-803-5385
mike@louvanpr.com

Korea / Asia media:
Min A KIM
Senior manager of Public Relations
Tel. +82-2-6903-5223
pr@maganachip.com

In the Media

Magnachip Introduces a new 40V MOSFET to Control BLDC Motors for Automotive Applications

SEOUL, South Korea, April 7, 2022 – Magnachip Semiconductor Corporation (“Magnachip”) (NYSE: MX) announced today that it will report its financial results for the first quarter ended March 31, 2022, on Tuesday, May 3, 2022, after the market closes. The Company will host a corresponding conference call at 2:00 p.m. PT / 5:00 p.m. ET to discuss its financial results.

The conference call will be webcast live and also is available by dialing toll-free at 1-844-536-5472 in US/Canada. International call-in participants can dial 1-614-999-9318. The conference ID number is 2619959. Participants are encouraged to initiate their calls at least 10 minutes in advance of the start time to ensure a timely connection. A live and archived webcast of the conference call and a copy of earnings release will be accessible from the ‘Investors’ section of the company’s website at www.magnachip.com. A replay of the conference call will be available until 8:00 p.m. ET on May 10, 2022. The replay dial-in numbers are 1-404-537-3406 or toll-free at 1-855-859-2056. The conference ID number is 2619959.

About Magnachip Semiconductor Corporation

CONTACTS:

So-Yeon Jeong
Jeong Consulting
Tel. +1-408-712-6151
Investor.relations@magnachip.com

Yujia Zhai
The Blueshirt Group
Tel. (860) 214-0809
Yujia@blueshirtgroup.com

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SOURCE Magnachip Semiconductor Corporation

Synchronous architecture of high-side and low-side switches achieves high efficiency

SEOUL, South Korea, March 15, 2022 — Magnachip Semiconductor Corporation (“Magnachip”) (NYSE: MX) announced today that the company has released a synchronous boost converter for a variety of applications, such as NAND flashes for SSDs, OLED panels and Bluetooth speakers.

Magnachip's high-performance synchronous boost converter for SSD NAND flashes — Magnachip’s high-performance synchronous boost converter for SSD NAND flashes

The new synchronous boost converter is equipped with a fast transient response to reduce output voltage fluctuations in a short response time for stable power supply. Therefore, the new product is ideally suited for devices, which can exhibit significant current variations.

The key feature of this newly released converter is a reduction in quiescent current of up to 1.5mA, as compared to the maximum 2mA of asynchronous boost converters currently on the market. Magnachip achieves this metric by the adoption of low-resistance high-side and low-side synchronous switches. Also, when a boost converter turns off, a built-in isolation switch prevents input voltage from being leaked through the output pin. And the soft-start time can be programmable by controlling the external capacitor and resistance values. This action reduces the in-rush current and ensures a stable power supply to external circuits.

This synchronous boost converter also provides strong circuit protection functions of overcurrent and overvoltage protection, thermal shutdown, fast discharge function and under voltage lockout in a small Dual Flat No Leads package (DFN) of 2.5mm x 2.5mm. It operates at the switching frequency of 1.2MHz, so a small-sized 4.7µH inductor with low capacity can be connected externally. As a result, the size of printed circuit board (PCB) will be reduced as well.

In addition, its packaging technology meets halogen-free requirements and also complies with the Restriction of the Use of certain Hazardous Substances in Electrical and Electronic Equipment (RoHS) – another example of Magnachip’s commitment to deliver environmentally-friendly and sustainable semiconductor products.

“In the last 10 years, Magnachip has developed a wide range of power solutions for TV, lighting, display panels, mobile and IT devices,” said YJ Kim, CEO of Magnachip. “Based upon our proven technological capabilities, we will continue to incorporate various features like bucks, boosts, multi-channels, op-amps and switch ICs into products and expand our next-generation product portfolio of integrated power management ICs.”

Related Link

DC-DC Conversions

About Magnachip Semiconductor
Magnachip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, computing, industrial and automotive applications. The Company provides a broad range of standard products to customers worldwide. Magnachip, with more than 40 years of operating history, owns a portfolio of approximately 1,150 registered patents and pending applications, and has extensive engineering, design and manufacturing process expertise. For more information, please visit www.magnachip.com. Information on or accessible through Magnachip’s website is not a part of, and is not incorporated into, this release.

CONTACTS:

United States (Investor Relations):
So-Yeon Jeong
Jeong Consulting
Tel. +1-408-712-6151
Investor.relations@maganachip.com

USA media / industry analysts:
Mike Newsom
LouVan Communications, Inc.
Tel. +1-617-803-5385
mike@louvanpr.com

Korea / Asia media:
Min A KIM
Senior manager of Public Relations
Tel. +82-2-6903-5223
pr@maganachip.com

In the Media

Magnachip Introduces High-performance Synchronous Boost Converter

High-performance synchronous boost converter for NAND flashes, OLED panels & Bluetooth speakers

SEOUL, South Korea, March 3, 2022 – Magnachip Semiconductor Corporation (NYSE: MX) (“Magnachip” or the “Company”) today announced that YJ Kim, Magnachip’s chief executive officer will participate at the 34^th Annual Roth Conference on March 13-15, 2022, in Dana Point, California.

Magnachip Semiconductor to Participate at the 34th Annual Roth Conference

YJ Kim will participate in one-on-one and small group meetings with institutional investors on Monday, March 14 and Tuesday, March 15, 2022. There will be no formal presentation. For more information about the conference or to request a one-on-one meeting, please contact a Roth sales representative.

About Magnachip Semiconductor Corporation

Magnachip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, computing, industrial and automotive applications. The Company provides a broad range of standard products to customers worldwide. Magnachip with more than 40 years of operating history, owns a portfolio of approximately 1,150 registered patents and pending applications, and has extensive engineering, design and manufacturing process expertise. For more information, please visit www.magnachip.com. Information on or accessible through Magnachip’s website is not a part of, and is not incorporated into, this release.

CONTACTS:
In the United States:
So-Yeon Jeong
Jeong Consulting
Tel. +1-408-712-6151
investor.relations@magnachip.com

In the Media

Cision PR Newswire: news distribution, targeting and monitoring home Magnachip to Attend Upcoming Investor Conferences

Magnachip Semiconductor to Participate at the 34th Annual Roth Conference

SEOUL, South Korea, February 17, 2022 — Magnachip Semiconductor Corporation (“Magnachip”) (NYSE: MX) announced today that the company has commenced full-scale mass production of an organic light-emitting diode display driver integrated circuit (OLED DDIC) for OLED TVs.

The new OLED DDIC supports a maximum of 960 source output channels, and, coupled with a Chip On Film (COF) package and high-speed serial interface, it is an ideal solution for OLED TVs. — The new OLED DDIC supports a maximum of 960 source output channels, and, coupled with a Chip On Film (COF) package and high-speed serial interface, it is an ideal solution for UHD TVs.

The recent rise of streaming and console gaming usage amid COVID-19 has driven demand for large-sized high-definition TVs and, as a result, global TV manufacturers are releasing premium OLED TV models. Magnachip developed a DDIC product for UHD OLED TVs based on enhanced high-voltage analog process technology and sophisticated designs and began initial mass production of it at the end of last year.

The new DDIC supports a maximum of 960 source output channels, and, coupled with a Chip On Film (COF) package and high-speed serial interface, it is an ideal solution for UHD OLED TVs. With Magnachip’s advanced technology for optimizing resolution, the new product supports various resolutions between HD (1,366 x 768) and UHD 4K (3,840 x 2,160). It also can be applied to different sizes of panels, ranging from 40 to 80 inches.

According to Omdia, a global market research firm, the compound annual growth rate of global OLED TV panel shipments is forecast to grow 14% from 7.4 million units in 2021 to 12.7 million units in 2025. Accordingly, this trend is expected to increase the demand for high-performance OLED DDIC solutions.

“The market share of OLED TVs in the premium TV market is increasing,” said YJ Kim, Magnachip’s CEO. “Magnachip will strengthen its technical leadership in the OLED DDIC market for large-sized displays by delivering high-performance products in a timely manner and will continue to diversify its product portfolio with advanced OLED DDIC solutions to address a wider range of applications including various IT devices and automobiles.”

Related Link

Large DDIC

About Magnachip Semiconductor

CONTACTS:

United States (Investor Relations):
So-Yeon Jeong
Jeong Consulting
Tel. +1-408-712-6151
Investor.relations@maganachip.com

USA media / industry analysts:
Mike Newsom
LouVan Communications, Inc.
Tel. +1-617-803-5385
mike@louvanpr.com

Korea / Asia media:
Min A KIM
Senior manager of Public Relations
Tel. +82-2-6903-3392
pr@maganachip.com

In the Media

Magnachip Enters Full-Scale Mass Production of OLED DDIC for OLED TVs

Magnachip begins mass production of “Display Driver” IC

– Fourth quarter revenue of $110.3 million was down 13.1% sequentially and down 22.8% year-over-year (YoY) due mainly to severe supply shortages especially for 28nm 12″ OLED wafers; Full-year revenue of $474.2 million decreased 6.5% YoY due primarily to a revenue decrease in our OLED business due to wafer supply shortages, offset in part by strong growth in our Power business.– GAAP gross profit margin for the fourth quarter was 35.0%, down 170 bps sequentially and up 810 bps YoY; Full-year GAAP gross profit margin of 32.4% was an increase of 710 bps YoY due mainly to improved product mix, increased average selling price, and a higher utilization rate.– GAAP diluted earnings per share (EPS) for the fourth quarter was $1.12; Full-year GAAP diluted EPS was $1.21.– Non-GAAP diluted EPS for the fourth quarter was $0.31; Full-year non-GAAP diluted EPS was $1.09.SEOUL, South Korea, Feb. 16, 2022 /PRNewswire/ — Magnachip Semiconductor Corporation (NYSE: MX) (“Magnachip” or the “Company”) today announced financial results for the fourth quarter and full-year 2021.

Commenting on the results for the fourth quarter of 2021, YJ Kim, Magnachip’s chief executive officer stated, “For the fourth quarter, the demand and signals from our customers remained strong across the board. However, severe supply constraints continued to significantly limit our OLED revenue potential, which was partially offset by strong Power business. We reported $110.3 million in revenue and 31 cents in non-GAAP diluted EPS for the fourth quarter.”

Commenting on the full-year, YJ stated, “While our 2021 revenue was negatively impacted by continuing supply shortages, especially for 28nm 12″ OLED wafers, we delivered higher profitability in all of our key measures in 2021 compared to 2020. In addition, our team at Magnachip achieved critical milestones to fuel future growth; we broadened our customer base, further penetrated new applications, and enhanced our supply chain for additional manufacturing capacity, which is expected to come online in the later part of 2022. While our near-term outlook is still being challenged by persisting supply constraints, these developments reinforce our confidence and optimism about our long-term growth.”

Q4 and 2021 Financial Highlights

	In thousands of U.S dollars, except share data
	GAAP
	Q4 2021			Q3 2021			Q/Q change				Q4 2020			Y/Y change
Revenues
Standard Products Business
Display Solutions		41,298			58,528			down	29.4	%		82,705			down	50.1	%
Power Solutions		58,212			58,887			down	1.1	%		46,861			up	24.2	%
Transitional Fab 3 foundry services⁽¹⁾		10,825			9,585			up	12.9	%		13,379			down	19.1	%
Gross Profit Margin		35.0	%		36.7	%		down	1.7	%pts		26.9	%		up	8.1	%pts
Operating Income		63,870			20,001			up	219.3	%		9,206			up	593.8	%
Net Income		53,611			10,768			up	397.9	%		66,581			down	19.5	%
Basic Earnings per Common Share		1.16			0.23			up	404.3	%		1.87			down	38.0	%
Diluted Earnings per Common Share		1.12			0.23			up	387.0	%		1.45			down	22.8	%

In thousands of U.S dollars, except share data
	Non-GAAP⁽⁴⁾
	Q4 2021		Q3 2021		Q/Q change				Q4 2020		Y/Y change
Adjusted Operating Income		14,421		22,691		down	36.4	%		15,355		down	6.1	%
Adjusted EBITDA		18,144		26,361		down	31.2	%		18,582		down	2.4	%
Adjusted Net Income		14,606		20,073		down	27.2	%		17,268		down	15.4	%
Adjusted Earnings per Common Share—Diluted		0.31		0.42		down	26.2	%		0.40		down	22.5	%

	In thousands of U.S dollars, except share data
	GAAP
	2021			2020			Y/Y Change
Revenues
Standard Products Business
Display Solutions		205,322			299,057			down	31.3	%
Power Solutions		227,777			166,462			up	36.8	%
Transitional Fab 3 foundry services⁽¹⁾		41,131			41,540			down	1.0	%
Gross Profit Margin		32.4	%		25.3	%		up	7.1	%pts
Operating Income⁽²⁾		83,407			27,016			up	208.7	%
Net Income⁽³⁾		56,708			344,965			down	83.6	%
Basic Earnings per Common Share		1.26			9.80			down	87.1	%
Diluted Earnings per Common Share		1.21			7.54			down	84.0	%

In thousands of U.S dollars, except share data
	Non-GAAP⁽⁴⁾
	2021		2020		Y/Y Change
Adjusted Operating Income		56,135		41,584		up	35.0	%
Adjusted EBITDA		70,701		52,919		up	33.6	%
Adjusted Net Income		51,059		28,260		up	80.7	%
Adjusted Earnings per Common Share—Diluted		1.09		0.73		up	49.3	%

(1)Following the consummation of the sale of the Foundry Services Group business and Fab 4 in Q3 2020, and for a period of up to three years, we will provide transitional foundry services to the buyer for foundry products manufactured in our fabrication facility located in Gumi (“Transitional Fab 3 Foundry Services”). Management believes that disclosing revenue of Transitional Fab 3 Foundry Services separately from the standard products business allows investors to better understand the results of our core standard products display solutions and power solutions businesses.

(2)For the year ended December 31, 2021, operating income of $83.4 million included net gain of $35.5 million that represented $70.2 million income from the recognition of a reverse termination fee, net of professional service fees and expenses of $34.7 million incurred in connection with the contemplated merger transaction.

(3)For the year ended December 31,2020, net income of $345.0 million included income from discontinued operations, net of tax, of $287.9 million, primarily attributable to the recognition of $287.1 million as gain on sale of the Foundry Services Group business and Fab 4. It also included income tax benefits of $46.2 million, mainly attributable to the recognition of differences between GAAP and cash tax expense of $43.9 million.

(4)Non-GAAP financial measures are calculated based on the results from continuing operations. Management believes that non-GAAP financial measures, when viewed in conjunction with GAAP results, can provide a meaningful understanding of the factors and trends affecting our business and operations and assist in evaluating our core operating performance. However, such non-GAAP financial measures have limitations and should not be considered as a substitute for net income from continuing operations or as a better indicator of our operating performance than measures that are presented in accordance with GAAP. A reconciliation of GAAP results to non-GAAP results is included in this press release.

Q1 2022 Financial Guidance
Our near-term outlook is still being challenged by persisting supply constraints especially for 28nm 12″ wafers. While actual results may vary, looking into the next quarter, which typically presents seasonal softness, Magnachip anticipates Q1 2022 to be the bottom and currently expects:

Revenue to be in the range of $102 million to $108 million, including about $9 million of the Transitional Fab 3 Foundry Services.
Gross profit margin to be in the range of 34.5% to 36.5%

Q4 2021 Earnings Conference Call
Magnachip will host a conference call at 5 p.m. Eastern Time on February 16, 2022. The conference call will be webcast live and also is available by dialing toll-free at 1-844-536-5472. International call-in participants can dial 1-614-999-9318. The conference ID number is 1582546. Participants are encouraged to initiate their calls at least 10 minutes in advance of the 5 p.m. Eastern Time start time to ensure a timely connection. The webcast and earnings release will be accessible at www.magnachip.com. A replay of the conference call will be available the same day and will run for 72 hours. The replay dial-in numbers are 1-404-537-3406 or toll-free at 1-855-859-2056. The access code is 1582546.

Safe Harbor for Forward-Looking Statements
Information in this release regarding Magnachip’s forecasts, business outlook, expectations and beliefs are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. These statements include expectations about estimated historical or future operating results and financial performance, outlook and business plans, including first quarter 2022 revenue and gross profit margin expectations, and the impact of the COVID-19 pandemic or the emergence of various variants of the virus, escalated trade tensions and supply constraints on Magnachip’s first quarter 2022 and future operating results. All forward-looking statements included in this release are based upon information available to Magnachip as of the date of this release, which may change, and we assume no obligation to update any such forward-looking statements. These statements are not guarantees of future performance and actual results could differ materially from our current expectations. Factors that could cause or contribute to such differences include, among others: the impact of changes in macroeconomic and/or general economic conditions, including those caused by or related to the COVID-19 pandemic or the emergence of various variants of the virus, other outbreaks of disease, recessions, economic instability or civil unrest; manufacturing capacity constraints or supply chain disruptions; the impact of competitive products and pricing; timely design acceptance by our customers; timely introduction of new products and technologies; ability to ramp new products into volume production; industry wide shifts in supply and demand for semiconductor products; industry and/or company overcapacity or supply constraints; effective and cost efficient utilization of manufacturing capacity; financial stability in foreign markets and the impact of foreign exchange rates; unanticipated costs and expenses or the inability to identify expenses which can be eliminated; compliance with U.S. and international trade and export laws and regulations by us, our customers and our distributors; change or ratification of local or international laws and regulations, including those related to environment, health and safety; public health issues, including the COVID-19 pandemic or the emergence of various variants of the virus; other business interruptions that could disrupt supply or delivery of, or demand for, Magnachip’s products, including uncertainties regarding the impacts of the COVID-19 pandemic or the emergence of various variants of the virus that may result in factory closures, reduced workforces, scarcity of raw materials and goods produced in infected areas, as well as reduced consumer and business spending affecting demand for Magnachip’s products due to government and private sector mandatory business closures, travel restrictions or the like to prevent the spread of disease; and other risks detailed from time to time in Magnachip’s filings with the U.S. Securities and Exchange Commission (the “SEC”), including our Form 10-K filed on March 9, 2021 (amended on April 30, 2021), our Form 10-Qs filed on May 10, 2021, August 6, 2021 and November 5, 2021 (including that the impact of the COVID-19 pandemic, trade tensions and supply constraints may also exacerbate the risks discussed therein) and subsequent registration statements, amendments or other reports that we may file from time to time with the SEC and/or make available on our website. Magnachip assumes no obligation and does not intend to update the forward-looking statements provided, whether as a result of new information, future events or otherwise.

About Magnachip Semiconductor
Magnachip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, computing, industrial and automotive applications. The Company provides a broad range of standard products to customers worldwide. Magnachip with more than 40 years of operating history, owns a portfolio of approximately 1,150 registered patents and pending applications, and has extensive engineering, design and manufacturing process expertise. For more information, please visit www.magnachip.com. Information on or accessible through Magnachip’s website is not a part of, and is not incorporated into, this release.

CONTACT:

In the United States:

So-Yeon Jeong

Jeong Consulting

Tel. +1-408-712-6151

Investor.relations@magnachip.com

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands of U.S. dollars, except share data) (Unaudited)

		Three Months Ended												Year Ended
	December 31,				September 30,				December 31,				December 31,				December 31,
		2021				2021				2020				2021				2020
Revenues:
Net sales – standard products business		$	99,510			$	117,415			$	129,566			$	433,099			$	465,519
Net sales – transitional Fab 3 foundry services			10,825				9,585				13,379				41,131				41,540
Total revenues			110,335				127,000				142,945				474,230				507,059
Cost of sales:
Cost of sales – standard products business			62,206				71,641				92,503				283,503				338,420
Cost of sales – transitional Fab 3 foundry services			9,525				8,772				11,981				37,184				40,322
Total cost of sales			71,731				80,413				104,484				320,687				378,742
Gross profit			38,604				46,587				38,461				153,543				128,317
Gross profit as a percentage of standard products business net sales			37.5	%			39.0	%			28.6	%			34.5	%			27.3	%
Gross profit as a percentage of total revenues			35.0	%			36.7	%			26.9	%			32.4	%			25.3	%
Operating expenses:
Selling, general and administrative expenses			13,255				12,550				12,576				52,440				49,974
Research and development expenses			12,197				12,270				11,604				51,212				45,698
Merger-related costs (income), net			(49,369)				1,552				653				(35,527)				653
Early termination and other charges, net			(1,349)				214				4,422				2,011				4,976
Total operating expenses (income)			(25,266)				26,586				29,255				70,136				101,301
Operating income:			63,870				20,001				9,206				83,407				27,016
Interest expense			(132)				(113)				(1,625)				(1,371)				(18,147)
Foreign currency gain (loss), net			147				(7,579)				13,256				(11,853)				(382)
Loss on early extinguishment of borrowings, net			—				—				(766)				—				(766)
Other income, net			947				1,608				767				3,786				3,110
Income from continuing operations before income tax expense			64,832				13,917				20,838				73,969				10,831
Income tax expense (benefit)			11,221				3,149				(47,064)				17,261				(46,228)
Income from continuing operations			53,611				10,768				67,902				56,708				57,059
Income (loss) from discontinued operations, net of tax			—				—				(1,321)				—				287,906
Net income		$	53,611			$	10,768			$	66,581			$	56,708			$	344,965
Basic earnings (loss) per common share—
Continuing operations		$	1.16			$	0.23			$	1.91			$	1.26			$	1.62
Discontinued operations			—				—				(0.04)				—				8.18
Total		$	1.16			$	0.23			$	1.87			$	1.26			$	9.80
Diluted earnings (loss) per common share—
Continuing operations		$	1.12			$	0.23			$	1.47			$	1.21			$	1.35
Discontinued operations			—				—				(0.02)				—				6.19
Total		$	1.12			$	0.23			$	1.45			$	1.21			$	7.54
Weighted average number of shares—
Basic			46,369,520				46,449,234				35,582,966				44,879,412				35,213,525
Diluted			47,691,816				47,808,457				47,062,903				47,709,373				46,503,586

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In thousands of U.S. dollars, except share data) (Unaudited)

	December 31,
	2021	2020
Assets
Current assets
Cash and cash equivalents	$ 279,547	$ 279,940
Accounts receivable, net	50,954	64,390
Inventories, net	39,370	39,039
Other receivables	25,895	4,338
Prepaid expenses	7,675	7,332
Hedge collateral	3,060	5,250
Other current assets	2,619	9,321
Total current assets	409,120	409,610
Property, plant and equipment, net	107,882	96,383
Operating lease right-of-use assets	4,275	4,632
Intangible assets, net	2,377	2,727
Long-term prepaid expenses	8,243	4,058
Deferred income taxes	41,095	44,541
Other non-current assets	10,662	9,739
Total assets	$ 583,654	$ 571,690
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable	$ 37,593	$ 52,164
Other accounts payable	6,289	2,531
Accrued expenses	20,071	16,241
Accrued income taxes	11,823	12,398
Operating lease liabilities	2,323	2,210
Current portion of long-term borrowings, net	—	83,479
Other current liabilities	7,382	4,595
Total current liabilities	85,481	173,618
Accrued severance benefits, net	33,064	40,462
Non-current operating lease liabilities	1,952	2,422
Other non-current liabilities	10,395	9,588
Total liabilities	130,892	226,090
Commitments and contingencies
Stockholders’ equity
Common stock, $0.01 par value, 150,000,000 shares authorized, 55,905,320 shares issued and 45,659,304 outstanding at December 31, 2021 and 44,943,854 shares issued and 35,783,347 outstanding at December 31, 2020	559	450
Additional paid-in capital	241,197	163,010
Retained earnings	343,542	286,834
Treasury stock, 10,246,016 shares at December 31, 2021 and 9,160,507 shares at December 31, 2020, respectively	(130,306)	(108,397)
Accumulated other comprehensive income (loss)	(2,230)	3,703
Total stockholders’ equity	452,762	345,600
Total liabilities and stockholders’ equity	$ 583,654	$ 571,690

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands of U.S. dollars) (Unaudited)

	Three Months Ended			Year Ended
		December 31,		December 31,		December 31,
		2021		2021		2020
Cash flows from operating activities
Net income		$	53,611	$	56,708	$	344,965
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization			3,663		14,239		16,481
Provision for severance benefits			2,768		8,282		16,743
Amortization of debt issuance costs and original issue discount			—		261		2,220
Loss (gain) on foreign currency, net			(175)		32,432		(23,233)
Restructuring and other charges			—		—		3,502
Merger-related costs (income), net			(12,142)		(12,142)		360
Provision for inventory reserves			760		2,244		3,695
Stock-based compensation			1,648		7,704		6,699
Loss on early extinguishment of borrowings, net			—		—		766
Gain on sale of discontinued operations			—		—		(287,117)
Deferred income tax assets			893		918		(44,441)
Other, net			(1,030)		(613)		217
Changes in operating assets and liabilities
Accounts receivable, net			809		7,505		(19,268)
Unbilled accounts receivable, net			—		—		14,260
Inventories			(1,378)		(5,939)		(816)
Other receivables			2,949		(2,338)		6,954
Other current assets			4,464		12,397		13,561
Accounts payable			4,755		(11,437)		3,960
Other accounts payable			(4,084)		(7,813)		(12,000)
Accrued expenses			(765)		(2,406)		(29,116)
Accrued income taxes			8,307		(1)		10,825
Deferred revenue			863		(131)		2,174
Other current liabilities			(104)		1,445		279
Other non-current liabilities			(732)		(1,398)		3,521
Contributions to severance insurance deposit accounts			(5,526)		(5,688)		(11,921)
Payment of severance benefits			(1,907)		(6,679)		(12,076)
Other, net			80		193		(3,724)
Net cash provided by operating activities			57,727		87,743		7,470
Cash flows from investing activities
Proceeds from settlement of hedge collateral			1,219		5,214		13,762
Payment of hedge collateral			(605)		(3,349)		(8,839)
Proceeds from disposal of property, plant and equipment			1,419		1,446		65
Purchase of property, plant and equipment			(18,844)		(32,212)		(36,100)
Payment for intellectual property registration			(159)		(614)		(741)
Collection of guarantee deposits			—		3,192		1,024
Payment of guarantee deposits			(41)		(5,001)		(1,236)
Proceeds from sale of discontinued operations			—		—		350,553
Other, net			16		(114)		(6)
Net cash provided by (used in) investing activities			(16,995)		(31,438)		318,482
Cash flows from financing activities
Repurchase of long-term borrowings			—		—		(224,250)
Proceeds from exercise of stock options			359		4,279		3,918
Acquisition of treasury stock			—		(1,653)		(1,125)
Acquisition of stock under accelerated stock repurchase agreement			(20,073)		(20,073)		—
Payment under accelerated stock repurchase agreement			(17,427)		(17,427)		—
Repayment of financing related to water treatment facility arrangement			(136)		(563)		(546)
Others			(58)		(107)		(278)
Net cash used in financing activities			(37,335)		(35,544)		(222,281)
Effect of exchange rates on cash and cash equivalents			(151)		(21,154)		24,612
Net increase (decrease) in cash and cash equivalents			3,246		(393)		128,283
Cash and cash equivalents at beginning of period			276,301		279,940		151,657
Cash and cash equivalents at end of period		$	279,547	$	279,547	$	279,940

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES RECONCILIATION OF OPERATING INCOME TO ADJUSTED OPERATING INCOME (In thousands of U.S. dollars) (Unaudited)

		Three Months Ended									Year Ended
	December 31,			September 30,			December 31,			December 31,			December 31,
	2021			2021			2020			2021			2020
Operating income		$	63,870		$	20,001		$	9,206		$	83,407		$	27,016
Adjustments:
Equity-based compensation expense			1,648			2,005			1,945			7,704			6,311
Inventory reserve related to Huawei impact of downstream trade restrictions			(379)			(1,081)			(871)			(1,460)			1,460
Expenses related to Fab 3 power outage			—			—			—			—			1,168
Merger-related costs (income), net			(49,369)			1,552			653			(35,527)			653
Early termination and other charges, net			(1,349)			214			4,422			2,011			4,976
Adjusted operating income		$	14,421		$	22,691		$	15,355		$	56,135		$	41,584

We present Adjusted Operating Income as a supplemental measure of our performance. We define Adjusted Operating Income for the periods indicated as operating income adjusted to exclude (i) Equity-based compensation expense, (ii) Inventory reserve related to Huawei impact of downstream trade restrictions, (iii) Expenses related to Fab 3 power outage, (iv) Merger-related costs (income), net and (v) Early termination and other charges, net.

For the year ended December 31, 2021, we recorded in our consolidated statement of operations net gain of $35,527 thousand that represented income of $70,200 thousand from the recognition of a reverse termination fee, net of professional service fees and expenses of $34,673 thousand incurred in connection with the contemplated merger transaction of the Company that was terminated in December 2021. For the same period, we also recorded $3,430 thousand of non-recurring professional service fees and expenses incurred in connection with the regulatory requests, partially offset by $1,419 thousand gain on sale of certain legacy equipment of the closed back-end line in our fabrication facility in Gumi (which was closed during the year ended December 31, 2018).

For the year ended December 31, 2020, we recorded in our consolidated statement of operations $4,422 thousand of early termination and other charges, net, in connection with the headcount reduction program offered and paid to the employees during the fourth quarter of 2020. During the same period, we also recorded $554 thousand of non-recurring professional service fees and expenses incurred in connection with certain treasury and finance initiatives.

MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA AND ADJUSTED NET INCOME (In thousands of U.S. dollars, except share data) (Unaudited)

		Three Months Ended									Year Ended
	December 31,			September 30,			December 31,			December 31,			December 31,
	2021			2021			2020			2021			2020
Income from continuing operations		$	53,611		$	10,768		$	67,902		$	56,708		$	57,059
Adjustments:
Interest expense, net			(726)			(439)			863			(1,238)			15,404
Income tax expense (benefit)			11,221			3,149			(47,064)			17,261			(46,228)
Depreciation and amortization			3,663			3,578			3,148			14,239			11,116
EBITDA			67,769			17,056			24,849			86,970			37,351
Equity-based compensation expense			1,648			2,005			1,945			7,704			6,311
Foreign currency loss (gain), net			(147)			7,579			(13,256)			11,853			382
Derivative valuation loss (gain), net			(29)			(237)			74			(123)			(148)
Loss on early extinguishment of borrowings, net			—			—			766			—			766
Inventory reserve related to Huawei impact of downstream trade restrictions			(379)			(1,081)			(871)			(1,460)			1,460
Expenses related to Fab 3 power outage			—			—			—			—			1,168
Merger-related costs (income), net			(49,369)			1,552			653			(35,527)			653
Early termination and other charges, net			(1,349)			(513)			4,422			1,284			4,976
Adjusted EBITDA			18,144			26,361			18,582			70,701			52,919
Income from continuing operations		$	53,611		$	10,768		$	67,902		$	56,708		$	57,059
Adjustments:
Equity-based compensation expense			1,648			2,005			1,945			7,704			6,311
Foreign currency loss (gain), net			(147)			7,579			(13,256)			11,853			382
Derivative valuation loss (gain), net			(29)			(237)			74			(123)			(148)
Loss on early extinguishment of borrowings, net			—			—			766			—			766
Inventory reserve related to Huawei impact of downstream trade restrictions			(379)			(1,081)			(871)			(1,460)			1,460
Expenses related to Fab 3 power outage			—			—			—			—			1,168
Merger-related costs (income), net			(49,369)			1,552			653			(35,527)			653
Early termination and other charges, net			(1,349)			(513)			4,422			1,284			4,976
GAAP and cash tax expense difference			907			—			(43,874)			907			(43,874)
Income tax effect on non-GAAP adjustments			9,713			—			(493)			9,713			(493)
Adjusted Net Income		$	14,606		$	20,073		$	17,268		$	51,059		$	28,260
Adjusted Net Income per common share—
– Basic		$	0.31		$	0.43		$	0.49		$	1.14		$	0.80
– Diluted		$	0.31		$	0.42		$	0.40		$	1.09		$	0.73
Weighted average number of shares – basic			46,369,520			46,449,234			35,582,966			44,879,412			35,213,525
Weighted average number of shares – diluted			47,691,816			47,808,457			47,062,903			47,709,373			46,503,586

We present Adjusted EBITDA and Adjusted Net Income as supplemental measures of our performance. We define Adjusted EBITDA for the periods indicated as EBITDA (as defined below), adjusted to exclude (i) Equity-based compensation expense, (ii) Foreign currency loss (gain), net, (iii) Derivative valuation loss (gain), net, (iv) Loss on early extinguishment of borrowings, net, (v) Inventory reserve related to Huawei impact of downstream trade restrictions, (vi) Expenses related to Fab 3 power outage, (vii) Merger-related costs (income), net and (viii) Early termination and other charges, net.

EBITDA for the periods indicated is defined as Income from continuing operations before interest expense, net, income tax expense (benefit) and depreciation and amortization. We prepare Adjusted Net Income by adjusting income from continuing operations to eliminate the impact of a number of non-cash expenses and other items that may be either one time or recurring that we do not consider to be indicative of our core ongoing operating performance. We believe that Adjusted Net Income is particularly useful because it reflects the impact of our asset base and capital structure on our operating performance. We define Adjusted Net Income for the periods as income from continuing operations, adjusted to exclude (i) Equity-based compensation expense, (ii) Foreign currency loss (gain), net, (iii) Derivative valuation loss (gain), net, (iv) Loss on early extinguishment of borrowings, net, (v) Inventory reserve related to Huawei impact of downstream trade restrictions, (vi) Expenses related to Fab 3 power outage, (vii) Merger-related costs (income), net, (viii) Early termination and other charges, net, (ix) GAAP and cash tax expense difference and (x) Income tax effect on non-GAAP adjustments.

For the year ended December 31, 2020, we recorded in our consolidated statement of operations $4,422 thousand of early termination and other charges, net in connection with the headcount reduction program offered and paid to the employees during the fourth quarter of 2020. During the same period, we also recorded $554 thousand of non-recurring professional service fees and expenses incurred in connection with certain treasury and finance initiatives.

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SOURCE Magnachip Semiconductor Corporation

SEOUL, South Korea, Jan. 31, 2022 /PRNewswire/ — Magnachip Semiconductor Corporation (“Magnachip”) (NYSE: MX) announced today it will report its results for the fourth quarter and year ended December 31, 2021 on Wednesday, February 16, 2022 after the close of market. The Company will host a corresponding conference call at 2:00 p.m. PT / 5:00 p.m. ET to discuss its financial results.

The conference call will be webcast live and also is available by dialing toll-free at 1-844-536-5472 in US/Canada. International call-in participants can dial 1-614-999-9318. The conference ID number is 1582546. Participants are encouraged to initiate their calls at least 10 minutes in advance of the start time to ensure a timely connection. A live and archived webcast of the conference call and a copy of earnings release will be accessible from the ‘Investors’ section of the company’s website at www.magnachip.com. A replay of the conference call will be available until 8:00 p.m. ET on February 23, 2022. The replay dial-in numbers are 1-404-537-3406 or toll-free at 1-855-859-2056. The conference ID number is 1582546.

About Magnachip Semiconductor

Magnachip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, industrial and automotive applications. The Company provides a broad range of standard products to customers worldwide. Magnachip, with more than 40 years of operating history, owns a portfolio of approximately 1,200 registered patents and pending applications, and has extensive engineering, design and manufacturing process expertise. For more information, please visit www.magnachip.com. Information on or accessible through Magnachip’s website is not a part of, and is not incorporated into, this release.

CONTACTS:
So-Yeon Jeong
Jeong Consulting
Tel. +1-408-712-6151
Investor.relations@magnachip.com

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SOURCE Magnachip Semiconductor Corporation

SEOUL, South Korea, January 13, 2022 — Magnachip Semiconductor Corporation (“Magnachip”) (NYSE: MX) announced today that the company has launched 11 new generation high-voltage 600V Super Junction Metal Oxide Semiconductor Field Effect Transistors (SJ MOSFETs). The company has already released product samples and plans to begin mass production of them in March 2022.

11 new generation high-voltage 600V Super Junction Metal Oxide Semiconductor Field Effect Transistors (SJ MOSFETs)

The new 2.5th generation (2.5G) 600V SJ MOSFETs were developed using new designs based on the latest process technology to improve switching functionality by more than 10% compared to previous generations. As a result, Magnachip has achieved lower switching loss and better power efficiency. For applications requiring high Electrostatic Discharge (ESD) ruggedness, a Zener diode is embedded between a gate and source in order to avoid damage to a MOSFET from an external surge or ESD.

The new product family of 600V SJ MOSFETs supports an Rds(on) (drain-source on resistance) of 190~580mOhm and comes in standard packaging formats, such as DPAK, TO-220F and TO-220SF. Therefore, these new 2.5G products can be widely used in products and applications including TVs, lighting infrastructure, fast chargers, adapters, PC power and industrial power supplies. They are also well suited for hard- and soft-switching topologies.

Magnachip has been delivering high-performance MOSFETs for the last 10 years. Cumulative shipments have now reached 2 billion units since the release of its first SJ MOSFET in 2013. Magnachip has supplied its current flagship 600V SJ MOSFETs to the world’s largest TV manufacturers and solidified its competitive edge in the SJ MOSFET market. Recently, major Korean TV manufacturers have stimulated demand by releasing premium models and demand for MOSFETs is expected to increase significantly along with the growth of premium TV market.

“With industry-proven technologies and products, Magnachip has satisfied the latest design requirements for both consumer and industrial markets,” said YJ Kim, CEO of Magnachip. “We will continue to develop cutting-edge power solutions like high-voltage SJ MOSFETs for automotive to expand our product portfolio and bring new capabilities to more applications.”

Related Link

HV MOSFETs_600V

About Magnachip Semiconductor

Magnachip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, computing, industrial and automotive applications. The Company provides a broad range of standard products to customers worldwide. Magnachip, with more than 40 years of operating history, owns a portfolio of approximately 1,200 registered patents and pending applications, and has extensive engineering, design and manufacturing process expertise. For more information, please visit www.magnachip.com. Information on or accessible through Magnachip’s website is not a part of, and is not incorporated into, this release.

CONTACTS:

United States (Investor Relations):
So-Yeon Jeong
Jeong Consulting
Tel. +1-408-712-6151
Investor.relations@maganachip.com

USA media / industry analysts:
Mike Newsom
LouVan Communications, Inc.
Tel. +1-617-803-5385
mike@louvanpr.com

Korea / Asia media:
Min A KIM
Senior manager of Public Relations
Tel. +82-2-6903-3392
pr@maganachip.com

In the media

Magnachip Launches New Generation of High-Voltage 600V SJ MOSFETs for Wide Range of Consumer Products and Industrial Applications

New generation of high-voltage 600V SJ MOSFETs for wide range of consumer products & industrial applications

Lower Rss(on) enables extremely fast battery charging

SEOUL, South Korea, January 12, 2022 — Magnachip Semiconductor Corporation (“Magnachip”) (NYSE: MX) announced today that the company has launched new generation Low-Voltage Metal Oxide Semiconductor Field Effect Transistors (LV MOSFETs) featuring lower Rss(on)* for battery Protection Circuit Modules (PCMs) in smartphones.

Magnachip’s new generation Low-Voltage Metal Oxide Semiconductor Field Effect Transistors (LV MOSFETs)

As demand for high-end 5G and LTE smartphones increases, extended battery life and strengthened protection features for batteries are becoming important. 5G phones, in particular, need long-lasting batteries with high endurance to process the large amount of data for fast download and upload. Magnachip developed the new generation LV MOSFETs with advanced overvoltage and overcurrent protection features to extend battery life and reduce overheating issues. Magnachip began mass production of this new 6.5^th generation (6.5G) product last month and it is being used in a new 2022 flagship model from one of the world’s largest smartphone manufacturers.

The Rss(on) of this new 6.5G product is 20% lower than the previous version with the same chip size to reduce current loss and improve heat dissipation. This lower Rss(on) controls a high power density above 25W to prevent a battery from overheating and protect the PCM while the battery is being fast-charged. Also, PCM functionality has been greatly enhanced by an upgraded Electrostatic Discharge (ESD) protection diode. This diode mitigates a maximum of 2kV, based on the human-body model, of ESD to strengthen circuit protection and prevent damage to other smartphone components. Along with this powerful battery protection, the size of chip was significantly reduced to better meet the requirements of new smartphone models.

According to Omdia, a market research firm, the global smartphone market will grow 6.3%, with more than 1.4 billion units sold in 2022. The wireless earphone market is also rapidly growing, which will further drive up the demand for LV MOSFETs. Magnachip has sold more than 1.3 billion units of LV MOSFETs in the last 10 years and more than 900 million units of MOSFETs for battery PCMs. Leveraging its industry-leading technological know-how and business expertise, the company plans to reinforce its market leadership commensurate with the growth of the high-end 5G smartphone market.

“Despite the current global chip shortage, we are confident that we can maintain a strong supplier capability for our customers as an integrated device manufacturer for these new 6.5G products,” said YJ Kim, CEO of Magnachip. “We will continue to maintain a close rapport with our existing customers and expand our presence in the global market at the same time.”

* Rss(on): On resistance, the resistance value between sources of two protected MOSFETs during operation (ON)

About Magnachip Semiconductor

Magnachip is a designer and manufacturer of analog and mixed-signal semiconductor platform solutions for communications, IoT, consumer, computing, industrial and automotive applications. The Company provides a broad range of standard products to customers worldwide. Magnachip, with more than 40 years of operating history, owns a portfolio of approximately 1,200 registered patents and pending applications, and has extensive engineering, design and manufacturing process expertise. For more information, please visit www.magnachip.com. Information on or accessible through Magnachip’s website is not a part of, and is not incorporated into, this release.

CONTACTS:

United States (Investor Relations):
So-Yeon Jeong
Jeong Consulting
Tel. +1-408-712-6151
Investor.relations@maganachip.com

USA media / industry analysts:
Mike Newsom
LouVan Communications, Inc.
Tel. +1-617-803-5385
mike@louvanpr.com

Korea / Asia media:
Min A KIM
Senior manager of Public Relations
Tel. +82-2-6903-3392
pr@maganachip.com

In the Media

Magnachip Introduces New Generation Low-Voltage MOSFET for Battery Protection Circuit Modules in Smartphones

Smartphone battery protection & fast-charging

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Lower Rss(on) enables extremely fast battery charging