Pixelworks (PXLW) AI Stock Analysis

• Market Cap: $46.20M
• Dividend Yield: N/A
• Average Volume (3M): 105.99K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.26
• Revenue Growth: -44.05%
• EPS Growth: -2.33%
• Country: US
• Employees: 196
• Sector: Technology
• Sector Strength: 82
• Industry: Semiconductors
• EPS (TTM): -1.00
• Shares Outstanding: 5,335,317
• 10 Day Avg. Volume: 160,422
• 30 Day Avg. Volume: 105,988
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.67
• Enterprise Value/Revenue: 2.25
• Enterprise Value/Gross Profit: 4.37
• Enterprise Value/Ebitda: -2.71
• 1Y Price Target: $11.67
• Price Target Upside: 34.76% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3

• Rating: 43 Neutral
• Price Target: $8.50 ▼(-1.85% Downside)

Pixelworks' overall stock score is primarily impacted by its poor financial performance, characterized by negative profitability and cash flow issues. While the earnings call provided some positive insights, such as improved gross margins, the ongoing financial challenges and negative valuation metrics weigh heavily on the stock's attractiveness.

Positive Factors

New Projector SoC

New projector SoC yields are ramping faster than expected.

Strategic Process

The Shanghai subsidiary's strategic process has resulted in non-binding term sheets from three potential buyers.

Negative Factors

Gross Margin

The new projector SoC is experiencing growing pains; packaging yields are challenged, lowering GM estimates by approximately 600bps.

Revenue and Guidance

Revenue estimates come down on Mobile pushouts, and OpEx is slightly trimmed.

Pixelworks Business Overview & Revenue Model

Company Description

Pixelworks, Inc., together with its subsidiaries, develops and markets semiconductor and software solutions for mobile, home entertainment, content, and business and education markets. The company provides video display processor products, including image processor integrated circuits, such as embedded microprocessors, digital signal processing technology, and software that control the operations and signal processing within high-end display systems; video co-processor integrated circuits that work with an image processor to post-process video signals to enhance the performance or feature set of the overall video solution; and transcoder integrated circuits, which comprise embedded microprocessors, digital signal processing technology, and software that control the operations and signal processing for converting bitrates, resolutions, and codecs. As of March 31, 2022, it had an intellectual property portfolio of 334 patents related to the visual display of digital image data. The company sells its through a direct sales force, distributors, and manufacturers' representatives in Japan, China, Taiwan, the United States, Europe, and Korea. Pixelworks, Inc. was incorporated in 1997 and is based in Portland, Oregon.

How the Company Makes Money

Pixelworks generates revenue primarily through the sale of its proprietary semiconductor products and software solutions. The company offers a range of products, including video processors and display controllers, which are integrated into various consumer electronics by original equipment manufacturers (OEMs). Key revenue streams include direct sales to OEMs, licensing agreements for its technology, and royalties from products that incorporate Pixelworks' innovations. The company has established significant partnerships with major brands in the consumer electronics industry, contributing to its earnings through collaborative development projects and integration of its technologies into high-demand devices. Additionally, as the demand for enhanced video experiences continues to grow, Pixelworks benefits from trends in the gaming and streaming markets, which require advanced video processing capabilities.

Pixelworks Financial Statement Overview

Summary

Pixelworks is facing significant financial difficulties with declining revenues, negative profitability margins, and a deteriorating balance sheet with negative equity. Cash flow management is a critical concern as the company operates with insufficient cash generation.

Income Statement

Pixelworks has been experiencing declining revenue over the years, with a notable drop in Total Revenue for the TTM (Trailing-Twelve-Months) period compared to previous years. The company has a negative Gross Profit Margin and Net Profit Margin, indicating operational inefficiencies and consistent losses. There is a significant negative EBIT and EBITDA margin, further reflecting the challenges in achieving profitability.

Balance Sheet

The balance sheet reveals high financial risk with a negative Stockholders' Equity, suggesting that liabilities exceed assets and shareholder value is eroded. The Debt-to-Equity ratio is not calculable due to negative equity, but the overall financial position is weak with declining asset base and increasing liabilities.

Cash Flow

Operating Cash Flow is negative, indicating that the company is not generating enough cash to sustain operations from its core activities. The Free Cash Flow is also negative and has worsened over time, highlighting cash management issues. The ratios of Operating and Free Cash Flow to Net Income are not meaningful due to negative figures, showcasing cash flow challenges.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	34.25M	43.21M	59.68M	70.15M	55.10M	40.85M
Gross Profit	17.64M	22.29M	25.71M	35.88M	27.69M	20.18M
EBITDA	-28.43M	-25.21M	-22.27M	-11.32M	-15.24M	-20.46M
Net Income	-31.41M	-28.72M	-26.18M	-16.03M	-19.82M	-26.53M
Balance Sheet
Total Assets	58.46M	64.07M	95.97M	102.32M	106.60M	72.04M
Cash, Cash Equivalents and Short-Term Investments	18.50M	23.65M	47.54M	56.82M	61.59M	31.51M
Total Debt	3.06M	3.49M	4.95M	3.54M	5.29M	7.13M
Total Liabilities	24.00M	24.19M	30.96M	30.07M	35.47M	19.17M
Stockholders Equity	-15.97M	-10.57M	12.54M	32.42M	40.22M	52.87M
Cash Flow
Free Cash Flow	-29.10M	-23.57M	-22.65M	-15.84M	-12.63M	-6.50M
Operating Cash Flow	-25.71M	-19.81M	-18.81M	-12.83M	-9.16M	-3.71M
Investing Cash Flow	-2.75M	-3.12M	-3.99M	-3.01M	-3.23M	3.94M
Financing Cash Flow	769.00K	-971.00K	13.53M	11.07M	42.71M	23.77M

Pixelworks Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 8.66
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PXLW, the sentiment is Positive. The current price of 8.66 is below the 20-day moving average (MA) of 8.68, below the 50-day MA of 9.00, and above the 200-day MA of 8.32, indicating a neutral trend. The MACD of -0.24 indicates Positive momentum. The RSI at 48.90 is Neutral, neither overbought nor oversold. The STOCH value of 21.09 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PXLW.

Pixelworks Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	61 Neutral	$35.55B	8.91	-10.55%	1.87%	8.47%	-8.26%
ASYS	57 Neutral	$91.90M	40.38	-47.86%	―	-20.20%	-58.57%
AXTI	55 Neutral	$143.45M	―	-12.56%	―	-2.63%	-78.66%
SQNS	49 Neutral	$21.98M	―	415.99%	―	32.23%	―
LEDS	48 Neutral	$13.98M	―	-14.79%	―	485.62%	85.02%
PXLW	43 Neutral	$46.20M	―	-2911.20%	―	-44.05%	-2.33%
WKEY	43 Neutral	$60.26M	―	-51.84%	―	-61.52%	35.64%

Pixelworks Corporate Events

Pixelworks Approves Reverse Stock Split at Shareholder Meeting

On May 23, 2025, Pixelworks, Inc. held its Annual Meeting of Shareholders, where several key proposals were voted on. The shareholders approved a reverse stock split at a ratio of 1-for-12, effective June 6, 2025, impacting the company’s stock trading on Nasdaq. Additionally, amendments to increase shares for the stock incentive plan and executive compensation were approved, along with the appointment of Grant Thornton LLP as the independent auditor. These decisions reflect strategic adjustments to enhance shareholder value and streamline corporate governance.