SEOUL, South Korea and SAN JOSE, Calif., Jan.13, 2020 /PRNewswire/ --MagnaChip Semiconductor Corporation (NYSE:MX) today provided an update to its previous guidance for the fourth quarter of 2019.
Revenue in the fourth quarter of 2019, ended December 31, is now expected to be in the range of $198-200 million, and gross profit margin is expected to be in the range of 26-27%, based on unaudited preliminary financial estimates. This updated guidance for the fourth quarter compares to the Company's previous guidance of revenue to be in the range of $181-191 million and gross profit margin to be in the range of 24-26%.
The previous revenue guidance provided on October 23, 2019, in conjunction with the public release of the financial results for the third quarter of 2019, reflected an expectation at that time that revenue in the fourth quarter would reflect normal seasonal softness in the OLED, Power and Foundry businesses. While seasonal softness was a factor for all three businesses, OLED revenue was significantly better than had been expected. The Power standard products business was seasonally softer than had been expected, and Foundry revenue was seasonally soft, but better than had been expected.
The previous gross profit margin guidance for the fourth quarter, provided on October 23, 2019, reflected an expectation at that time that fab utilization would decline, reflecting normal seasonal softness. However, increased fab loading along with a richer OLED product mix contributed to better-than-expected gross profit margin results in the fourth quarter, as compared to previous estimates.
MagnaChip also reiterated today that the strategic evaluation of its Foundry business and Fab4, the larger of the Company's two 8" manufacturing facilities, is ongoing. As was previously announced on October 23, 2019, the Companycontinues to make substantial progress on the strategic evaluation process, including discussions with multiple interested parties toward a possible sale of the business, as well as consideration of accretive business conversions, joint ventures and partnerships.
MagnaChip's updated revenue and gross profit margin guidance for the fourth quarter of 2019 is not a comprehensive statement of financial results, and actual figures may vary. The Company expects to announce full financial results for the fourth quarter in February.