Pixelworks Cuts Workforce 14%, Posts 48.3% Revenue Decline

Pixelworks hopes to save $3.2 million annually through a restructuring that includes a 14% head-count reduction, said the tech company Monday. Q2 revenue declined 48.3% from a year earlier, despite a 24% increase in mobile revenue from higher shipments of Iris-brand visual processors to six smartphone OEMs. “Our second quarter results reflected the anticipated headwinds associated with the broad impact from the COVID-19 pandemic on our target end markets,” said CEO Todd DeBonis on a quarterly call Monday. The stock plunged 25.6% Tuesday to close at $2.54. Pixelworks began seeing the “green shoots of the recovery in mobile demand in the current quarter,” he said. “We continue to believe there will be a high correlation between OEMs’ adoption of 5G technology and high-performance displays and smartphones, as video remains the most single compelling use case for 5G with consumers.” The smartphone industry is “still in the early innings” of the 5G transition, said DeBonis. “We are seeing a more rapid introduction of high-frame-rate displays into mid-tier phones than we previously anticipated, which is positive and increases the Pixelworks value proposition in mid-tier devices.”