PXLW - Pixelworks: Sell On Disappointing Outlook

2024-05-16 23:55:00 ET

Summary

• Pixelworks reported Q1/2024 largely in line with previous guidance, but the company's outlook fell well short of expectations.
• An order pause by its largest mobile customer and delayed release of the company's new mobile visual processor will impact financial results for at least the next couple of quarters.
• In addition, the deadlines for listing the company's Chinese operating subsidiary on the Shanghai STAR Market are approaching quickly.
• Under a worst-case scenario, PXLW will be required to repay up to $44 million to Chinese pre-IPO investors.
• Considering the ugly combination of severe business headwinds and near-term PWSH IPO deadlines, investors should consider selling existing positions and moving on.

After the close of Tuesday's regular session, video and display enhancement chip designer Pixelworks, Inc. or "Pixelworks" ( PXLW ) reported Q1/2024 results largely in line with previous guidance :

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