PORTLAND, Ore.—Todd DeBonis, President and CEO of Pixelworks , Inc. (NASDAQ:PXLW), recently sold 41,884 shares of the company's common stock. The sale, which occurred on November 20, 2024, was executed at an average price of $0.7351 per share, amounting to a total transaction value of approximately $30,788.
Following this transaction, DeBonis retains direct ownership of 1,699,300 shares in Pixelworks. The sale was carried out to cover tax obligations stemming from restricted stock units released earlier in the month.
Pixelworks, a company specializing in semiconductors and related devices, is headquartered in Portland, Oregon.
In other recent news, Pixelworks has initiated a $10 million "at the market" equity program in partnership with Roth Capital Partners (WA:CPAP). The agreement allows Pixelworks the flexibility to determine the conditions of its share sales, including quantity, timing, and minimum acceptable sales price. Roth Capital Partners, as the sales agent, is authorized to conduct sales in accordance with the Securities Act of 1933.
Pixelworks recently reported a Q3 2024 revenue of $9.5 million, despite a significant 76% year-over-year drop in mobile revenue. Needham, a financial analyst firm, revised the price target for Pixelworks to $1.50 from the previous $2.00, maintaining a buy rating. This adjustment came after the company's solid quarter and a projected lower fourth-quarter top line due to the ongoing reset in its Mobile segment.
Furthermore, Pixelworks has shipped samples of its next-generation Visual Processing Unit (VPU) to multiple Tier-1 customers, with design win decisions expected in the near future. The company is also engaging with customers for evaluations of its new cost-down X5 part, indicating a potential expansion into the low-and-mid-tier phone segments for Pixelworks' VPUs.
In addition, Pixelworks has secured a multi-year agreement with Universal Pictures for the TrueCut Motion platform and is exploring strategic options with Morgan Stanley (NYSE:MS)'s advisory. These recent developments indicate the company's strategic shifts and efforts to balance its performance amid a mobile revenue decline.
InvestingPro Insights
The recent stock sale by Pixelworks' CEO Todd DeBonis comes at a time when the company is facing several challenges, as highlighted by InvestingPro data and tips. Pixelworks' stock has taken a significant hit, with a 31.76% decline over the past six months and an 11.64% drop in just the last week. This downward trend aligns with the company's financial performance, as revenue declined by 4.07% in the last twelve months, with a more pronounced 40.58% drop in the most recent quarter.
InvestingPro Tips reveal that Pixelworks is "quickly burning through cash" and is "not profitable over the last twelve months." This is reflected in the company's operating income margin of -50.72% and a negative EBITDA of -$24.74 million. Despite these challenges, it's worth noting that Pixelworks "holds more cash than debt on its balance sheet" and its "liquid assets exceed short-term obligations," which could provide some financial flexibility.
The market currently values Pixelworks at a market cap of $45.74 million, with the stock trading at $0.74 as of the previous close. This is significantly below the fair value of $1.50 estimated by analyst targets, suggesting potential upside if the company can overcome its current challenges.
For investors seeking a more comprehensive analysis, InvestingPro offers 11 additional tips for Pixelworks, providing a deeper insight into the company's financial health and market position.
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