Omnivision Technologies -Earnings Call Transcript

Good afternoon everyone and welcome to our fiscal 2010 first quarter earnings conference call. Just after the close of market today, Omnivision issued an earnings release reporting our financial results for our first quarter. You can access this release from the investor relations section of our website at ovt.com.

Please be advised that this call is being webcast live and is also being recorded for playback purposes. Both the live webcast and the replay can also be accessed from the investor relations section of our website.

Before we begin, we wish to remind you that certain information discussed in this call, in particular our revenues, earnings targets and our forward-looking product plans is based on information as of today August 27, 2009 and contains forward-looking statements that involve risks and uncertainties. Actual results may differ materially from those set forth in such statements.

For a discussion of these risks and uncertainties, you should review the forward-looking statements disclosure in the earnings release we issued to today as well as Omnivision's SEC filings including our annual report on Form 10-K for fiscal 2009 and our quarterly reports on Form 10-Q and other reports filed from time to time.

During this call we will discuss GAAP and non-GAAP financial measures. A reconciliation between the two is available in our earnings release posted on our website.

With that, I will now turn the call over to Omnivision's President and Chief Executive Officer, Mr. Shaw Hong.

Shaw Hong

I would like to welcome everyone who is participating in our call today. Joining me today are Anson Chan, our CFO, Ray Cisneros, our VP of Sales and Bruce Wyer our VP of Marketing.

I will begin the call with an overview of our results for the quarter and then provide our thoughts on the overall status of the image sensor market, the trends we see in the market and within that trend, our competitive positioning, and lastly our commitment to customers as an integral part of meeting demands and the trends of the market.

I'll ask Ray to present an overview of sales activity and outlook followed by Bruce who will discuss our recent product introductions. Finally, Anson will discuss detailed financial results for the first quarter and provide our outlook for the second quarter of fiscal 2010. We will conclude as usual by answering as many of your questions as time permits.

We are pleased to report fiscal 2010 first quarter revenues of $105.6 million representing sequential growth of 19% as compared to the fourth quarter of 2009. Gross margins also improved sequentially from 17% in the fourth quarter to 22.4% for this quarter. Our net loss was $0.19 per share and our non-GAAP net loss was $0.08 per share.

We experienced revenue growth across all of our markets consistent with general improvements in the demand for consumer electronics. In particular, we saw strength in the mobile phone and notebook markets and introductions in the back-to-school Netbook sales drew consumer spending.

More importantly, and Ray and Bruce will expand on this, we are excited by the wide range of our recent consumer product introductions and we are encouraged by the overall market demand for our products as reflected in booking trends.

Our first quarter performance also included a number of positive metrics which demonstrate that our operating strategy supporting our competitive position is well aligned with the demands and trends of the market.

As we know, mobile communications and the imaging technology continue to transform the lives of millions of people around the world, changing the way we work, how we play and how we interact with those around us. Facebook and U-tube have given us new methods for managing our lives and memories.

These and other consumer applications will continue to drive the need for advanced image capture technology in many formats. According to a report published in June by TSR, the number of image sensor units shipped is expected to almost double from 1.4 billion per year in 2009 to approximately 2.4 billion per year in 2013.