GSI Technology Inc. reported a decline in financial performance for the three and six months ended September 30, 2024, compared to the same periods in the previous fiscal year. Net revenues for the quarter were $4.55 million, a decrease of 20.3% from $5.71 million in Q3 2023. For the six months, revenues fell 18.4% to $9.22 million from $11.30 million. The company attributes this decline primarily to reduced sales of its SRAM products, which accounted for approximately 99% of total revenues. The largest customer, Nokia, represented about 20% of net revenues in the six months ended September 30, 2024, down from 27% in the same period of 2023.
Gross profit also decreased significantly, with Q3 2024 gross profit at $1.76 million, down 43.7% from $3.12 million in Q3 2023. The gross margin fell from 54.7% to 38.6% year-over-year. The company reported a net loss of $5.46 million for Q3 2024, compared to a net loss of $4.06 million in Q3 2023. For the six months, the net loss was $4.38 million, an improvement from a loss of $9.17 million in the same period last year.
In response to ongoing market challenges, GSI implemented strategic cost-cutting measures, including a 16% reduction in its global workforce, expected to yield annual savings of approximately $3.5 million. The company incurred $357,000 in severance-related charges during the quarter. Additionally, GSI completed a sale and leaseback transaction of its Sunnyvale property for $11.3 million, which provided a significant boost to its cash position, increasing cash and cash equivalents to $18.36 million as of September 30, 2024, up from $14.43 million at the end of March 2024.
Research and development expenses increased as a percentage of net revenues, reaching 105.2% in Q3 2024, compared to 82.2% in Q3 2023. This reflects the company's continued investment in developing new products, particularly in associative computing, despite the overall revenue decline. The company is transitioning its focus towards higher-density SRAM products and associative computing solutions, which it hopes will improve future profitability.
Overall, GSI Technology faces significant challenges, including fluctuating customer demand, inflationary pressures, and supply chain constraints, which have impacted its financial results and strategic direction.
About GSI TECHNOLOGY INC
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