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Technology Stocks : Silicon Motion Inc. (SIMO) -- Ignore unavailable to you. Want to Upgrade?

To: OlafB who wrote (2847)	4/30/2025 8:57:14 AM
From: Elroy	4 Recommendations Recommended By Jim50 Kirk © Lance Bredvold OlafB Respond to of 2977

Some SIMO earnings call quick notes CEO Wallace- NAND flash makers are increasing outsourcing of NAND controllers. A design win with NVDA? Global economic picture is increasingly difficult to navigate. The impact is limited as the US accounts for a small percentage of the Android cell phone market, and 20% of the PC market. In Q1 2025 consumer NAND market has bottomed and enterprise storage demand remains strong. NAND price increases and tariff expense is driving greater demand for QLC NAND because it's the least expensive NAND. SIMO believes it is the best positioned controller maker in QLC NAND, and is getting increasing customer interest in enterprise storage as well as PC and cell phone storage. We still expect PC units to grow in low to single digit percentage range. There has been some modest pull in of orders in April to beat the tariffs. The new 6nm PCie Gen5 8 channel controller is getting increasing design wins. SIMO has 4 of 6 NAND makers all module makers. It will ramp strongly for the remainder of 2025. There is a new 6nm Gen5 4 channel controller which has already secured 4 NAND makers as OEM, and virtually every module maker has given it a win. This chip will ramp in H2 2025. These two chips are going to be huge. A new market developing is white box AI servers, and those servers are using the above 8 channel chip. With these two chips SIMO is well positioned for client SSD growth over the next few YEARS. UFS 3.1 and UFS 2.2 are getting strong demand in March 2025. Module makers (using SIMO UFS) are gaining share from NAND makers in low end mass market cell phones. And NAND makers are moving to SIMO to compete. Missed any UFS 4.x update. Mon Titan - have been working with NVDA to qualify Mon Titan with NVDA. SIMO has been designed into the Bluefield Three (??) platform. Each Bluefield Three TPU will be paired with multiple something? As Mon Titan evolves they plan to expand with other customers, similar to this NVDA win. They are also developing additional new Mon Titan semiconductors. They are working on PCIe 6 controllers targetting an NVDA platform which is expected to ramp in 2027. Mon Titan will ramp in H2 2025 and more meaningfully in 2026. Autos - Shipping to many of the biggest names in Auto industry. They still expect autos to reach 10% of sales 2026/27 time period. SIMO is in the Nintendo Switch 2. They have about 80% market share in this product. In conclusion, 2025 start has been challenging due to geopolotics and tariffs, but the future growth story for SIMO remains really strong, and SIMO will going forward expand partnerships with NAND makers. Growth drivers = PC SSD gen5 PCIe SSD controller market share gains, Mon Titan, autos and UFS 4.1. CFO Jason Tsai: Tax rate for 2025 should be 15%. Stock comp and "dispute costs" = $28m Q&A: What's the customer count expectation for Mon Titan going forward? The NVDA design win gives them access to 30+ enterprise SSDs. It connects to 30+ enterprise SSDs, and gives SIMO the opportunity to be involved in those customer's future design plan. Tell us about the 6nm and future design node plan. In the near term SIMO will have two 6nm tape outs, and next year they will have a 4nm tape out for PCIe Gen6 controllers. This is good because SIMO is in the full design pipeline, they just need to make the (expensive to develop) products. For client devices SIMO does not now plan to move beyond 6nm. They are exploring using other foundries to try to get better pricing longer term. How should we size the NVDA partnership? The NVDA products ramp late this year and more in 2026. We expect the NVDA relationship to be a meaningful portion of Mon Titan sales. Every major enterprise storage user is looking for higher density storage options, and QLC NAND and Mon Titan provide that. All PC OEMs are ramping 8 channel PCIe Gen5 from July, and SIMO has 4 of 6 NAND makers. The 4 channel PCIe Gen5 will ramp in mainstream next year, again SIMO has 4 of 6 NAND makers. SIMO will win at least 50% of this PC business starting from July 2025 and growing for the next 12-18 months. They think the NVDA relationship is fantastic and will give them a great opportunity to grow in the NVDA eco-system going forward.