MagnaChip updates its Q2 guidance

MagnaChip says that revenue in the second quarter of 2019, ending June 30, is now expected to be at least USD 194 million, and gross profit margin is expected to be at least 21%. This is quite the update from the company's previous guidance of revenues in the range of USD 173-181 million and gross profit margin to be in the range of 16-18%. The previous revenue guidance provided reflected an expectation at that time that revenue from MagnaChip's OLED Display drivers would increase by approximately 30% and that revenue from the Foundry business would be flat, both as compared to the first quarter of 2019. However, revenue for both OLED Display drivers and 8" Foundry services is now expected to substantially exceed the previously anticipated financial results for the second quarter. Revenue from Power standard products is also expected to be stronger than previously anticipated. MagnaChip also stated today that the strategic evaluation of its Foundry business and Fab 4 – the larger of the company's two 8" manufacturing facilities – is ongoing. Fab 4 is an analog and mixed-signal fab that produces approximately 73% of the Company's total capacity, and is used primarily to meet wafer demand from Foundry customers that rely on outside suppliers. As previously announced, the strategic evaluation includes a range of possible options, including joint ventures, strategic partnerships and M&A possibilities.