GSI Technology, Inc. Reports Fourth-Quarter and Year-End Fiscal 2011 Results

"Here I should mention a previously announced lawsuit, filed by Cypress Semiconductor in U.S. District Court on March 30, 2011, which alleges patent infringement principally related to our SigmaQuad and SigmaDDR products. While it is of course impossible to predict the outcome of such litigation," concluded Shu, "at this point we believe that our position is strong and that Cypress' claims are without merit. We intend to defend this lawsuit vigorously; however the cost of patent litigation can be significant, and the legal expenses incurred in the defense of this lawsuit could adversely affect our operating results over the coming quarters."

Total fourth-quarter pre-tax stock-based compensation expense was $408,000 compared to $428,000 in the third quarter and $395,000 in the comparable quarter a year ago. For the year, pre-tax stock-based compensation expense was $1.7 million compared to $1.5 million in fiscal 2010.

At March 31, 2011, the Company had $52.0 million in cash, cash equivalents and short-term investments, $30.9 million in long-term investments, $80.0 million in working capital, no debt, and stockholders’ equity of $124.7 million.

Outlook for First-Quarter Fiscal 2012

We currently expect net revenues in the first quarter of fiscal 2012 to be in the range of $22.0 million to $23.0 million with gross margin of approximately 45%.

Conference Call

GSI Technology will review its financial results for the quarter ended March 31, 2011 and discuss its current business outlook during a conference call for investors at 1:30 p.m. PDT (4:30 p.m. EDT) today, May 5, 2011. To listen to the teleconference, please call toll-free 877-717-3046 (or 706-634-6364 for international callers) approximately 10 minutes prior to the start time and provide conference ID 60329846. You may also listen to the teleconference live via the Internet at or For those unable to attend, these Web sites will archive the call.

About GSI Technology

Founded in 1995, GSI Technology, Inc. is a leading provider of high-performance static random access memory, or SRAM, products primarily incorporated in networking and telecommunications equipment. Headquartered in Santa Clara, California, GSI Technology is ISO 9001 certified and has worldwide factory and sales locations. For more information, please visit

Forward-Looking Statements

The statements contained in this press release that are not purely historical are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding GSI Technology’s expectations, beliefs, intentions, or strategies regarding the future. All forward-looking statements included in this press release are based upon information available to GSI Technology as of the date hereof, and GSI Technology assumes no obligation to update any such forward-looking statements. Forward-looking statements involve a variety of risks and uncertainties, which could cause actual results to differ materially from those projected. These risks include those associated with fluctuations in GSI Technology’s operating results; GSI Technology’s historical dependence on sales to a limited number of customers and fluctuations in the mix of customers and products in any period; the rapidly evolving markets for GSI Technology’s products and uncertainty regarding the development of these markets; the need to develop and introduce new products to offset the historical decline in the average unit selling price of GSI Technology’s products; the challenges of rapid growth followed by periods of contraction; intensive competition; and the patent infringement litigation currently pending against the Company, including the costs associated with the defense of the litigation. Further information regarding these and other risks relating to GSI Technology’s business is contained in the Company’s filings with the Securities and Exchange Commission, including those factors discussed under the caption “Risk Factors” in such filings.



(in thousands, except per share data)
Three Months Ended Twelve Months Ended
Mar. 31, Dec. 31, Mar. 31, Mar. 31, Mar. 31,
  2011   2010     2010   2011   2010
Net revenues $ 21,854 $ 26,244 $ 21,244 $ 97,763 $ 67,558
Cost of goods sold   12,218   14,121     12,074   53,009   38,342
Gross profit   9,636   12,123     9,170   44,754   29,216
Operating expenses:
Research & development 2,601 2,632 2,411 10,632 9,069
Selling, general and administrative   2,470   2,791     2,387   10,722   9,534
Total operating expenses   5,071   5,423     4,798   21,354   18,603
Operating income 4,565 6,700 4,372 23,400 10,613
Interest and other income, net   245   (48 )   133   461   1,965
Income before income taxes 4,810 6,652 4,505 23,861 12,578
Provision for income taxes   1,398   814     700   4,985   2,195
Net income $ 3,412 $ 5,838   $ 3,805 $ 18,876 $ 10,383
Net income per share, basic $ 0.12 $ 0.21 $ 0.14 $ 0.67 $ 0.38
Net income per share, diluted $ 0.11 $ 0.20 $ 0.14 $ 0.64 $ 0.38
Weighted-average shares used in
computing per share amounts:
Basic 28,488 28,076 27,470 28,013 27,105
Diluted 30,642 29,751 28,120 29,685 27,688
Stock-based compensation included in the Condensed Consolidated Statements of Operations:
Three Months Ended Twelve Months Ended
Mar. 31, Dec. 31, Mar. 31, Mar. 31, Mar. 31,
  2011   2010     2010   2011   2010
Cost of goods sold $ 63 $ 60 $ 75 $ 300 $ 291
Research & development 212 208 190 834 686
Selling, general and administrative   133   160     130   578   502
$ 408 $ 428   $ 395 $ 1,712 $ 1,479

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