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Technology Stocks : SSTI... The March Upwards -- Ignore unavailable to you. Want to Upgrade?

To: Spartex who wrote (255)	7/21/2004 4:21:15 PM
From: pompsander	Respond to of 291

SST Reports Second Quarter 2004 Financial Results Wednesday July 21, 4:14 pm ET Revenues Up 23 Percent and Net Income Up 55 Percent From 1Q04 SUNNYVALE, Calif., July 21 /PRNewswire-FirstCall/ -- SST (Silicon Storage Technology, Inc.) (Nasdaq: SSTI - News), a leader in flash memory technology, today announced financial results for the second quarter ended June 30, 2004. ADVERTISEMENT Net revenues for the second quarter were $128.5 million, up 23 percent compared with $104.4 million in the first quarter of 2004 and up 100 percent compared with $64.2 million in the second quarter a year ago. Net income for the second quarter of 2004 was $22.1 million, or $0.22 per share, based on approximately 100.5 million diluted shares outstanding. By comparison, the company recorded net income of $14.2 million, or $0.14 per share on approximately 100.3 million diluted shares outstanding in the first quarter of 2004, and a net loss of $4.6 million, or a loss of $0.05 per share on 94.5 million shares outstanding in the second quarter of 2003. SST finished the second quarter with $143.7 million in cash, cash equivalents and short-term investments. "We are pleased to report very strong financial results despite the seasonal softness normally associated with the second quarter," said Bing Yeh, president and CEO. "Our positive results are due to the continued strong demand for our flash memory products, improved manufacturing costs and firming selling prices during the second quarter. We set a new record in our overall unit shipments, which grew 15 percent compared with the first quarter. This unit growth was mainly driven by the very strong growth in shipments to the digital consumer and wireless communication segments, offset by weaker than normal seasonal shipments to Internet computing and networking applications. "On the product front, in April we announced the production availability of our 8-Mbit Serial Peripheral Interface serial flash memory device. We believe that this device is ideal for a variety of applications including hard disk drives, printers, security systems, industrial controls, 802.11 a/b/g and wired networking equipment. Additionally, we recently announced the beginning of production of our 64Mbit MPF+ device. With additional key features, including Boot-Block, Security ID, Erase Suspend and Resume, and Hardware Reset, we believe our MPF+ product family is ideal for applications such as mobile phones, set-top boxes, PDAs and networking equipment. "On the technology front, we have started the development activities for a 0.13 micron technology based on the second generation SuperFlash cell, as the near term cost reduction path for our current 0.18 micron designs ranging from 16Mbit to 128Mbit. This development activity is in parallel with a more aggressive technology development based on our third generation SuperFlash cell. "At the VLSI Technology Symposium held in mid-June in Hawaii, we, jointly with Powerchip Semiconductor, revealed a memory cell structure based on our third generation SuperFlash technology boasting 4.5 feature-square cell size with 0.11 micron lithography. We believe this is the industry's smallest flash cell at 0.11-micron rule with NOR architecture. We are aggressively pursuing this technology for our entry into the data storage market and our future cost reduction path for our medium- to high-density code storage products. We believe the technology advance will provide us a cost structure and sustainable competitiveness in the face of the competition from more established players in the medium to high density code storage market. "In summary, we believe we are poised for a strong second half of the year. We are aggressively implementing a technology roadmap that we believe will dramatically expand our addressable market. We have solid and unique relationships with our licensing and foundry partners that will allow us to accommodate increasing demand for our products. And we are successfully transitioning our products to smaller geometries to lower our manufacturing costs. In the mean time, we continue to exercise tight control of our expenses. With these factors, coupled with positive market conditions, we believe we can achieve significant profitable growth in the coming quarters." Third Quarter 2004 Outlook The company expects its third quarter unit shipments to grow between 10 to 20 percent sequentially due to strong demand in digital consumer and rebounding Internet computing segments. The company believes that its third quarter revenues will be between $130 million and $145 million, assuming no drastic changes occur in the U.S. and international economies. Gross margin is expected to be between 32 and 35 percent, which takes into consideration the risks associated with the company's production ramp of higher density products and lower licensing revenue than the second quarter. R&D spending is expected to be approximately 10 percent higher than the prior quarter due to new products and transition to more advanced manufacturing technology. The income tax rate is expected to be between 8 and 10 percent. With these revenue and expense levels, SST expects to achieve earnings per share of between $0.16 and $0.21 in the third quarter. Conference Call SST's quarterly conference call will be held today, July 21 at 1:30 p.m. PDT. Those wishing to participate in the conference should dial 888-428-4480 using the pass code "SST" at approximately 1:20 p.m. PDT. A replay of the call will be available for two weeks by dialing 800-475-6701 using the access code 735601. A webcast of the conference call will be available on sst.com . The webcast will be available until the next earnings conference call.