Vimicro (NASDAQ-VIMC) Q2-2012 Update

Thu, 2012-08-09

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Title: Vimicro (NASDAQ-VIMC) Q2-2012 update - NEUTRAL - Transition continues smoothly; top-line improvements beat guidance and bottom line within forecasts

Synopsis: Vimicro recorded US$20.1 million in revenues for Q2-2012, beating our estimate of US$17.0 million. US$1.8 million consolidated net loss is in line with our forecast of US$1.5 million loss, the difference of which can be attributed to a one-time non-cash charge of US$0.74 million. We revised our forecast to US$21.8 million in Q3-2012 revenues, which remains within management guidance of US$20 to US$22 million. We continue to believe that Vimicro will be able to achieve quarterly net income breakeven in Q3-2012, and we maintain our Neutral rating and target price of US$1.20.

Report length: 5 pages (excluding legal disclaimer)

Miller Chu
Peter Fang, CFA