Earnings call transcript: Pixelworks Q2 2025 reveals significant EPS miss

Pixelworks Inc. (PXLW) reported its Q2 2025 earnings, revealing a notable miss on earnings per share (EPS) expectations. The company posted an EPS of -$1.00, significantly below the forecasted -$0.08, marking an 1150% surprise. Revenue came in at $8.25 million, falling short of the $9.7 million forecast, resulting in a 14.95% revenue miss. Despite these results, Pixelworks shares rose by 11.79% in aftermarket trading, closing at $8.53. According to InvestingPro data, while the company holds more cash than debt on its balance sheet, it’s quickly burning through cash reserves, which could impact future operations.

Key Takeaways

• Pixelworks reported a significant EPS miss, with results far below analyst expectations.
• Revenue for Q2 2025 was $8.25 million, missing forecasts by nearly 15%.
• Despite the earnings miss, Pixelworks shares increased by 11.79% in aftermarket trading.
• The company is focusing on strategic initiatives in the mobile and visual processing sectors.
• Pixelworks anticipates increased profitability in its Shanghai subsidiary by Q4 2025.

Company Performance

Pixelworks’ performance in Q2 2025 reflects both challenges and opportunities. The company’s revenue of $8.3 million showed an improvement from $7.1 million in Q1 2025 but was lower than the $8.5 million recorded in the same quarter of 2024. The company continues to focus on its TrueCut Motion platform and mobile visual processors, aiming to capitalize on emerging opportunities in the mobile and display markets.

Financial Highlights

• Revenue: $8.3 million, up from $7.1 million in Q1 2025, but down from $8.5 million in Q2 2024.
• EPS: -$1.00, a significant miss compared to the forecasted -$0.08.
• Non-GAAP Gross Profit Margin: 46%, down from 49.9% in Q1 2025.
• Non-GAAP Operating Expenses: $9.7 million, decreased from $10.4 million in Q1 2025.

Earnings vs. Forecast

Pixelworks reported an EPS of -$1.00, significantly below the expected -$0.08, resulting in an 1150% negative surprise. This marks a substantial deviation from previous quarters, highlighting the company’s current financial challenges. Revenue also fell short of expectations, with a 14.95% miss against the forecasted $9.7 million.

Market Reaction

Despite the earnings miss, Pixelworks shares rose by 11.79% in aftermarket trading, closing at $8.53. This movement suggests investor optimism, possibly driven by strategic initiatives and future growth prospects. The stock’s performance contrasts with its 52-week high of $15.03 and low of $4.669.

Outlook & Guidance

Looking ahead, Pixelworks projects Q3 2025 revenue between $8.5 million and $9.5 million, with a non-GAAP gross margin of 47-49%. Operating expenses are expected to range from $8.5 million to $9.5 million. The company is also targeting profitability for its Shanghai subsidiary by Q4 2025, alongside exploring ASIC design services and IP licensing opportunities.

Executive Commentary

CEO Todd DeBonis highlighted the company’s strategic focus, stating, "We are seeing progression and we currently have active IP evaluations underway with three tier one system companies in China and one tier one system company in North America." He also noted the need for differentiation in a flat mobile market, emphasizing the importance of custom solutions and IP licensing for expansion.

Risks and Challenges

• Continued revenue and EPS misses could impact investor confidence.
• The flat mobile market presents growth challenges.
• Dependence on strategic initiatives for future profitability.
• Potential supply chain disruptions affecting production and delivery.
• Macroeconomic pressures may influence consumer spending and demand.

Q&A

During the earnings call, analysts inquired about the dynamics of the mobile market and Pixelworks’ strategies for custom solutions. The company also discussed its exploration of ASIC design and IP licensing opportunities, addressing concerns about the end-of-life transcoding chip business.

Full transcript - Pixelworks Inc (PXLW) Q2 2025:

Conference Operator: Good day, ladies and gentlemen, and welcome to Pixelworks Inc. Second Quarter twenty twenty five Earnings Conference Call. I will be your operator for today’s call. At this time, all participants are in a listen only mode. Following management’s prepared remarks, instructions will be given for the question and answer session.

This conference call is being recorded for replay purposes. I would now like to turn the call over to Brett Perry with Shelton Group Investor Relations.

Brett Perry, Investor Relations, Shelton Group: Thank you, Dee Dee. Good afternoon and thank you for joining us on today’s call. With me on the call are Pixelworks’ President and CEO, Todd DeBonis and Chief Financial Officer, Haley Yamon. The purpose of today’s conference call is to supplement the information provided in Pixelworks’ press release issued earlier today announcing the company’s financial results for the 2025. Before we begin, I’d like to remind you that various remarks we make on this call, including those about our projected future financial results, economic and market trends, and competitive position constitute forward looking statements.

These forward looking statements and all other statements made on this call that are not historical facts are subject to a number of risks and uncertainties that may cause actual risks to differ materially. All forward looking statements are based on the company’s beliefs as of today, Tuesday, 08/12/2025. The company undertakes no obligation to update any such statements to reflect events or circumstances occurring today. Please refer to today’s press release, the company’s annual report on Form 10 ks for the year ended 12/31/2024, and subsequent SEC filings for a description of factors that could cause forward looking statements to differ materially from actual results. Additionally, the company’s press release and management statements during this conference call will include discussions of certain measures and financial information in both GAAP and non GAAP terms, including gross margin, operating expenses, net loss and net loss per share.

Non GAAP measures exclude restructuring costs and stock based compensation expense, as well as the tax effect of the non GAAP adjustments. The company uses these non GAAP measures internally to assess its operating performance. We believe these non GAAP measures provide a meaningful perspective on core operating results and underlying cash flow dynamics. We caution investors to consider these measures in addition to and not as a substitute for nor superior to the company’s consolidated financial results as presented in accordance with U. S.

GAAP. Please note throughout the company’s press release and management statements during this conference call, we refer to net loss attributable to PixarWorks, Inc, simply net loss. Also note on 06/06/2025, the company affected a one for 12 reverse stock split of the company’s common stock, and all shares of the company’s common stock per share data and related information included in today’s published condensed consolidated financial statements have been retroactively adjusted as though the reverse stock split had been affected prior to all periods presented. For additional details and reconciliations of GAAP to non GAAP net loss and GAAP net loss to adjusted EBITDA, please refer to the company’s press release issued earlier today. With that, it’s now my pleasure to turn the call over to PixWorks CEO for his opening remarks.

Todd, please go ahead.

Todd DeBonis, President and CEO, Pixelworks Inc.: Thank you, Brett. Good afternoon and welcome to everyone on the phone and webcast. We appreciate you joining us for today’s conference call. Earlier today, we reported top and bottom line results that were within our guidance and reflected our expectations for return to sequential revenue growth in the second quarter. Gross margin came in better than anticipated due to yield improvements on a ramping new co development projector SOC.

We also realized another step down in recurring costs with second quarter operating expenses decreasing more than $3,000,000 year over year to below $10,000,000 Staying with the same order of our most recent calls, I’ll start with an update on our TrueCut Motion business, then provide remarks specific to our majority owned Pixelworks Shanghai subsidiary and the strategic review process. Starting with our TrueCut Motion platform. Following a quiet first half of the year in terms of new titles across the industry, we’ve recently been credited with three new theatrical releases. First in early July, Pictures, Jurassic World Rebirth, then earlier this month, DreamWorks Animation, The Bad Guys two, and yesterday we announced Universal Pictures, Nobody two. As discussed in the past exhibitors are investing significantly in laser PLF theater upgrades that drive higher box office revenues.

TrueCut Motion delivers major improvements to the viewing experience in these theaters and exhibitors are increasingly asking for the format, driving increased pool for True Cut Motion at the studios. Notably China’s flagship Sineady theaters promoted that Jurassic World Rebirth was exclusively available in the true cut motion format on their screens. Studios understand that premium screens generate an out outsized portion of the box office sales. So we confidently expect to see expanded presence of true cut motion format and the brand in theaters worldwide. While exhibitor and audience pool are growing, an important indication of studio and filmmaker acceptance is the quality and success of the titles on which we’ve been credited.

As of today, titles that utilize true cut motion have achieved over $4,000,000,000 at the box office, proving that our current studio partners Universal, DreamWorks, Disney, Legendary and Lightstorm see the value that TrueCut brings to their tent pole production films. These encouraging results clearly show that we are moving towards sustained growth for titles and brand awareness. Also notable, we were excited to recently receive confirmation that in advance of the scheduled theatrical release of Avatar Fire and Ash in December, James Cameron’s highly successful Avatar The Way of the Water will return to selected IMAX screens in October using the TrueCut Motion format. Based upon our recent momentum, we believe TrueCut Motion format is quickly moving towards becoming a standard for premium large format cinemas. With cinema format standards, a leading indicator of future home entertainment standards, there is a growing consumer desire to bring the TrueCut Motion PLF experience home.

The first home entertainment device to support TrueCut Motion is also one of the world’s best ways to watch movies outside of the cinema, namely the Apple Vision Pro. Streaming services Disney plus and Apple TV plus both brought Avatar, the way of the water and the four ks rerelease of the original Avatar to their respective platforms and apps for this device. We encourage anyone who has the opportunity and wants to fully appreciate what TrueCut Motion can do for the movie experience to watch either title on the Apple Vision Pro and compare that to the experience of titles that don’t utilize TrueCut Motion format. Recognizing the differentiated sales opportunity and growing consumer awareness, premium streaming services and home entertainment device brands are engaging closely with us to roll out the format. Turning to an update on our PixaWorks Shanghai subsidiary.

As a reminder, and for newer participants on today’s call, as part of the strategic realignment initiated in the 2021 timeframe, we restructured our Shanghai based subsidiary to serve as the center of operations for all PICCs work semiconductor business. This includes all generations of our open market and co developed visual display processor chips for both the digital projector and mobile markets, as well as previously end of life transcoding chips for video delivery. Starting with an update on the mobile business. Second quarter mobile revenue had a similar profile to the prior quarter, with shipments largely in support of residual demand from customers previously launched smartphone models. Although design ins for newly launched smartphones and the expected revenue recovery has taken longer to materialize, we remain committed to several existing engagements that we believe will contribute to achieving renewed mobile growth over the coming quarters.

Our strategy and efforts are focused on two defined approaches based upon the market segment. The first is expansion of our served target market with a new low cost mobile graphics accelerator solution for mid and entry level smartphones. Our open market roadmap will continue to focus on improving the visual performance of graphics, animation and gaming in mobile phones with ASPs below $350 We have created a completely new architecture to dramatically improve the performance of application processors used in this market segment. Second, we continue to pursue the premium gaming experience for mobile phones with ASPs over $350 with our current X7 Prime and X8 flagship mobile visual processors. Within this premium segment, we have seen growing interest and a trend towards a more customer optimized solution.

And going forward, we are increasingly focused on IP licensing and custom design engagements. Highlighting our most recent win resulting from an in-depth collaboration with the customer over the weekend, OPPO’s affiliate brand RealMe previewed their upcoming launch of its RealMe P4 series in India targeted for August 20. Both the Realme P4 and P4 Pro smartphones are explicitly marketed as incorporating Pixelworks X7 Gen two visual processor. The Realme P4 series will be the first phones in the segment of the market to feature dual chips based upon our distributed rendering architecture. The P4 Pro model pairs our X7 visual processor alongside a Snapdragon seven Gen four applications processor and the standard P4 model will pair our processor alongside a MediaTek Dimensity 7,400 Ultra five gs apps processor.

In both device models, our visual processor enables 144 frame per second gaming on over 100 mobile games with real time frame generation and AI enhanced 1.5 ks resolution upscaling. In addition to delivering visual performance typically reserved for flagship smartphones, our rendering acceleration solution contributes to improved system responsiveness and extended gameplay while eliminating overheating and the need for performance throttling. Touching briefly on our home and enterprise business, which comprises of our visual processor system on a chips for three LCD digital projector market. Revenue increased by over 20% sequentially driven by a combination of the traditional bounce back from seasonally lower first quarter demand as well as a growing ramp in shipments of our newest SOC to our large co development projector customer. Despite the ongoing dynamic global trade environment, we have yet to see evidence of meaningful impacts from our customers order patterns.

Consistent with our comments last quarter, we continue to anticipate our total projector business in 2025 to look very similar to 2024. Shifting gears to a brief update on the adjacent revenue opportunities discussed in recent quarters. Starting with transcoding, which again as a reminder, we completed all scheduled end of life shipments of transcoding products during the fourth quarter of last year. Subsequently, we were approached by two different prior transcoding customers that expressed interest in sizable one time orders for our prior transcoding chips that are no longer in production. As of today, we have a purchase order in hand from one of the customers and we expect to fulfill the entirety of this order during the fourth quarter.

The second prior customer representing the larger opportunity is still evaluating whether to move forward. We have communicated a deadline to this customer and we will know that the outcome on the second opportunity by quarter end. Next with respect to ASIC design services. Having established a framework earlier this year, we now have a pipeline of prospective ASIC design service engagements. We are currently engaged with two different companies with the potential to become our first design service customer.

Both of these initial ASIC design service customers have the potential to contribute revenue later this year. And we expect increased visibility on these respective opportunities in the coming months. In addition to working towards winning these two programs, we’re continuing to focus on expanding our pipeline of design service opportunities. Lastly, in terms of IP licensing. Since our previous conference call, the number of discussions and evaluations underway with third parties have expanded meaningfully.

Given the binary and sometimes open ended nature of these programs, it’s challenging to provide definitive timelines and qualitative updates on these collective discussions. However, we are seeing progression and we currently have active IP evaluations underway with three tier one system companies in China and one tier one system company in North America. Given our previous actions to significantly reduce our cost structure and ongoing efforts to streamline the business, today we are better positioned to drive bottom line results from a reasonably small uplift in revenue. Although the planned recovery in mobile revenue is taking a bit longer than previously anticipated, we are still targeting for our Pixelworks Shanghai subsidiary to reach profitability as soon as the fourth quarter. Having said that, I want to share the latest status on our strategic review process.

To briefly recap how and when this process originated, in the latter part of 2024, we received inbound strategic interest in our PixarWorks Shanghai subsidiary. We engaged Morgan Stanley as an advisor and initiated a formal review process. In addition to reviewing the initial inbound interest, the process was to expanded to include strategic a strategic evaluation of potential alternative ownership structures, as well as possible collaboration structures, all specific to our Shanghai based subsidiary. Relatively early in the process, we received additional inbound interest from multiple other unrelated third parties. Following early stage discussions with all interested parties, as well as some preliminary due diligence, Pixelworks Inc.

Imposed a deadline of May 31 to receive term sheets from all parties that were interested in moving forward. We received non bargaining term sheets from three different potential buyers. We have since been engaged with due diligence with all three parties. I traveled to Shanghai last week and although the outcome is yet to be determined, we believe the process is progressing well and nearing closure and likely to result in a new strategic direction for our Pixelworks Shanghai subsidiary before the end of the third quarter. With that, I’ll turn the call to Haley review financials and provide guidance for the third quarter.

Haley Yamon, Chief Financial Officer, Pixelworks Inc.: Thank you, Todd. Revenue for the 2025 was $8,300,000 compared to $7,100,000 in the first quarter and $8,500,000 in the 2024. The sequential increase in second quarter revenue was primarily driven by product shipments in the home and enterprise market. The breakdown of revenue in the second quarter was as follows: Home and enterprise revenue was approximately 7,100,000.0 Revenue from mobile was approximately $1,200,000 Second quarter non GAAP gross profit margin was 46% compared to 49.9% in the first quarter of twenty twenty five and fifty one percent in the 2024. The sequential decrease in gross profit margin reflected a unique mix consisting of a new product ramp within home enterprise.

However, yields related to this new product ramp were better than originally expected, leading to gross margin that was above our second quarter guidance range. Non GAAP operating expenses of $9,700,000 in the second quarter compared to $10,400,000 in the prior quarter and $12,800,000 in the 2024. The sequential and year over year decrease in operating expenses reflects the results of our previously taken actions to reduce operating expenses and streamline our overall cost structure. Additionally, during the second quarter, our Pixelworks Shanghai subsidiary received approximately $1,600,000 in cash subsidies as part of its certified status in China’s Little Giant program. These subsidies effectively serve as reimbursement for certain purchases of IP and design tools, as well as various R and D expenses.

We recognized $800,000 of other income in the second quarter, with the remainder of the total subsidies allocated as offsetting credits to applicable expense and balance sheet items. On a non GAAP basis, second quarter twenty twenty five net loss was 5,300,000.0 or a loss of $1 per share, compared to a net loss of $6,500,000 or a loss of 1.3 per share in the prior quarter, and a net loss of $7,700,000 or a loss of $1.6 per share in the 2024. Adjusted EBITDA for the 2025 was a negative $4,300,000 compared to a negative $5,800,000 in the prior quarter, and a negative $7,000,000 in the 2024. Turning to the balance sheet, we ended the second quarter with cash and cash equivalents of $14,300,000 compared to $18,500,000 at the end of the first quarter. Shifting to our current expectations and guidance for the 2025.

Based on our existing backlog, we currently expect total revenue for the third quarter to be in a range of between $8,500,000 and $9,500,000 For the third quarter, we expect non GAAP gross profit margin to be between 4749%. This range primarily reflects a more favorable product mix within Home and Enterprise. With respect to operating expenses, we expect third quarter operating expenses to be in a range of between $8,500,000 and $9,500,000 on a non GAAP basis. Note that this range reflects the expected incremental benefits associated with our cost reduction actions taken during the first and second quarters. Lastly, we expect third quarter non GAAP EPS to range between a loss of $0.70 per share and a loss of $1.02 per share.

That completes our prepared remarks, and we look forward to taking your questions. Operator, please proceed with Q and A.

Conference Operator: Thank you. And our first question comes from Suji Desilva of Roth Capital. Your line is open.

Suji Desilva, Analyst, Roth Capital: Hi, Todd. Hi, Haley. Maybe first, Todd, you could talk about why your mobile customers in China in the premium side are emphasizing custom ASIC versus your standard merchant products. I’m just curious the trends underneath that that’s driving that opportunity for you.

Todd DeBonis, President and CEO, Pixelworks Inc.: Yeah, the driver is they want differentiation. They want something that the other phone, I mean, Suji, it’s a flat market. I don’t expect high growth in the overall mobile market. I expect the Chinese OEMs to try to expand globally beyond their reach where they don’t have strong market shares. You know, clearly very strong in China.

They’re reasonably strong in Southeast Asia. They’re not that strong in the rest of the world. With the exception that you could say at the very low end like in Africa and emerging markets. But if you look in the premium segment, which is where your question is, right? They have very little position in developed countries.

Those countries are dominated by Apple, Samsung and to some degree Motorola and Google. Frankly, Google’s doing okay right now with the Pixel. So in our target customers are these Chinese OEMs for the most part. We talked to others but for the most part Chinese OEMs. I think as we go to an IP sale that expands that horizon for us.

But if you look at the specific Chinese OEMs, they’re in a hyper competitive market. My personal belief is you’ll see consolidation in that market either through attrition or M and A. There’s one or two too many large or larger companies, but the market’s not there to support all of them in my opinion. So what you’re going see is a hyper competitive environment and in the premium segment they’re going to want to differentiate and especially in the geopolitical environment and in showing technology leadership. And so buying a standard product that is similar across the board doesn’t give them that differentiation.

The current two AP manufacturers really don’t give them much differentiation because they sell them the same APs across the board. So one way for them to differentiate if you go look at these customers and their premium phones, they’re not just putting a custom visual processor in. I think one of Xiaomi’s last phones they announced four custom chips inside their phone from you know pre ISP, AI enhancement, visual processing, what they call a display chip which is their own custom DDIC. You know so these Chinese manufacturers are very focused on trying to bring their own intellectual property into the phone. And one way to do it is work with partners like us on custom solutions.

Suji Desilva, Analyst, Roth Capital: Okay, that’s very helpful Todd. And just as a follow-up on that, after you do this design work for a customer, would you be the one manufacturing and selling it to them or is this meant to be more of a royalty model where the customer takes over the manufacturing?

Todd DeBonis, President and CEO, Pixelworks Inc.: There’s only one Chinese well that’s not true. There’s two Chinese OEMs that produce their own SoCs. In that particular case it’d be design services and IP. Although they still use external visual processors, none of them have integrated our capabilities into the AP yet. The other manufacturers are going to differentiate by ancillary chips.

So to answer your specific question, if it’s an ancillary chip opportunity, we would do the production. If it’s somebody who is trying to integrate this into their own apps SOC, it would probably be a combination of IP and design services.

Suji Desilva, Analyst, Roth Capital: Okay. And then maybe a question for Hailey, the transcoding one time customer, you have the PO now, is that revenue hitting in the third quarter or the fourth quarter? And maybe give us some idea of the magnitude of how much that’s helping the second half.

Haley Yamon, Chief Financial Officer, Pixelworks Inc.: Yeah, that would be hitting in the fourth quarter. Magnitude, I don’t know that we’re going to share the magnitude right now.

Suji Desilva, Analyst, Roth Capital: Okay. Maybe one last one for Todd, I’ll pass it along. Todd, you said that Pixelworks post what’s going on with the Shanghai division restructuring wise or strategically would make a kind of a different post that transaction Pixlix. Maybe give us some sense of how Pixlix be different pre and post that transaction to the best of your ability. I know it’s an ongoing process, but if you help understand it.

Todd DeBonis, President and CEO, Pixelworks Inc.: It’s early to give any color on that Suji. I appreciate the question and as soon as I’m in a position to give color in that regard I will.

Suji Desilva, Analyst, Roth Capital: That’s fine. Thanks. Thanks.

Conference Operator: You. And our next question comes from Nick Doyle of Needham and Company. Your line is open.

Nick Doyle, Analyst, Needham and Company: Hi guys. Thanks for taking my questions. Really interesting commentary on the ASIC design and IP. I mean, guess my question would be how broad does that go with these prospective customers? Is it limited to the smartphone AP or can your IP be used in other components or other markets?

Thank you.

Todd DeBonis, President and CEO, Pixelworks Inc.: Good question, Nick. No, it is not limited to smartphone only. I mean, we’ve already had some of the prescriptive engagements we’ve had and have been in the tablet area. There’s a clear need to improve the performance, display performance, visual performance in tablets, and it’s a growing segment. And then this up and coming ARVR market, whether it’s augmented reality glasses or complete virtual reality headsets, there is a need to utilize technology like ours in these applications.

There’s also people, I mean, there’s more, I’ll call them journeyman markets from LED panel walls to monitors, gaming monitors. So it would we clearly are too small to go build products for all these environments. But if we open up from an IP and design services and collaboration standpoint, we can pursue more of these adjacent markets.

Nick Doyle, Analyst, Needham and Company: Yeah, lot of potential customers, bigger market there. You. Seeing strength in home and enterprise market, I mean, you just talk about the product market fit with your new SOC that’s driving this recovery? What about the new product is driving that strength? Thanks.

Todd DeBonis, President and CEO, Pixelworks Inc.: Yeah, no problem. I don’t want to be misrepresented here. The overall market, we have a strong position in the 3LCD, well over 90% share, okay, from what I can tell. So the overall market, even though our core sequentially and then even with guidance we’re going up a little bit, our overall market I would say is flat. Okay, the market we sell into.

But when we are ramping a new SOC which happens to be a higher ASP than our old SOC initially the customers need to put in production based inventory, know some buffer inventory. So they’ll pull harder on those new chips than what their actual production is at least for a period of time, right. So we see the reason we’re seeing some growth is partly because of the higher ASP of the mix and partly because of the stocking of this new chip. Whether that sustained pull through in 2026 or not will completely depend on the end markets.

Nick Doyle, Analyst, Needham and Company: Understood. Thank you for that. And if I could just squeeze one last one. Can you just confirm if you did any EOL business in 2Q or we’re waiting till 4Q to see that? Thanks.

Todd DeBonis, President and CEO, Pixelworks Inc.: So what we were saying is we EOL the visual the last of our consumer visual of our video delivery products, transcoding chips. When we that was a process of notification to customers in early twenty four and they had to take last shipments by the ’24. That was all complete. We had a couple of customers that came back, which is almost predictable anytime you end up life a series of devices like this that have been in the market for well over ten years, that somebody comes back even though you’ve notified them and says, hey, we need more. Oh, hey, we have a new program.

Hey, can you support us on some derivative program? And so we’ve had two customers that we’ve engaged in those discussions. As long as you have the ability to go back to our supply chain and manufacture it, which we have validated, we can do it. But because you’re no longer supporting this as a standard product, the engagement with those customers is a very specific engagement where they have to take the liability of the production. And they have to make it, there’s usually large minimum orders required and certain delivery lead times, which they’ll probably going to have to inventory the devices that they want them.

And so if it’s a large opportunity it’s a lot for a customer to bite off on. And so they need to think about it but that’s the terms of coming back after an EOL is done.

Suji Desilva, Analyst, Roth Capital: Got it. Thank you.

Todd DeBonis, President and CEO, Pixelworks Inc.: Thanks for the question.

Conference Operator: Thank you. I show no further questions at this time. I’d like to turn it back to management for closing remarks.

Todd DeBonis, President and CEO, Pixelworks Inc.: Well, thanks. We clearly have a lot of activity over here. I look forward to updating you most probably on the strategic process before our next quarterly call. Thank you.

Conference Operator: This concludes today’s conference call. Thank you for participating. You may now disconnect.

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