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Silicon Motion Announces Third Quarter Results for the Period Ended September 30, 2009
Oct 29, 2009 (GlobeNewswire via COMTEX) -- Third Quarter 2009

Financial Highlights



 -- Net sales increased 14% quarter-over-quarter to US$23.1 million
 -- Gross margin excluding stock-based compensation was unchanged
    at 48.5% compared with our 2Q09 gross margin
 -- Operating expenses excluding stock-based compensation,
    acquisition-related charges, and one-time items increased from
    2Q09 of US$11.2 million to US$12.0 million in the third quarter
 -- Net income excluding stock-based compensation, acquisition-
    related charges, foreign exchange gain, and one-time items
    decreased to US$0.8 million from US$1.0 million in 2Q09. GAAP
    net loss decreased to US$4.7 million from a loss of US$6.2
    million in 2Q09
 -- Diluted earnings per ADS excluding stock-based compensation,
    acquisition-related charges, foreign exchange gain (loss), and
    one-time items were US$0.02, a decrease from our 2Q09 earnings
    per ADS of US$0.03.  GAAP diluted loss per ADS was US$0.16

Business Highlights



 -- Increased total unit shipments 24% sequentially but decreased
    37% year-over-year to approximately 67 million units
 -- Increased storage controller unit shipments 21% sequentially
    but decreased 39% year-over-year
 -- Launched controllers that support SanDisk/Toshiba 43nm and 32nm
    3-bits per cell MLC flash, SanDisk/Toshiba 32nm 2-bits per cell
    MLC flash and Samsung 42nm and 32nm 3-bits per cell MLC flash
 -- Designed in at two major card vendors for their ultra high
    performance 133x Secure Digital (SD) cards
 -- Began shipping world's fastest 600x Compact Flash (CF) card
    controller, which enables 90MB per second data rate
 -- Began shipping our ISDB-T SoC solution to Samsung for the
    emerging Brazil mobile TV market
 -- Received two additional CDMA transceiver design-ins for the
    rapidly growing China market

TAIPEI, Taiwan, Oct. 30, 2009 (GLOBE NEWSWIRE) -- Silicon Motion Technology Corporation (Nasdaq:SIMO) (the "Company") today announced its third quarter 2009 financial results. For the third quarter of 2009, net sales increased 14% quarter-over-quarter to US$23.1 million. Net loss (GAAP) for the third quarter decreased to US$4.7 million or US$0.16 per diluted ADS compared to a GAAP net loss of US$6.2 million or US$0.22 per diluted ADS in the second quarter.

Net income excluding stock-based compensation, acquisition-related charges, foreign exchange gain, and one-time items decreased in the third quarter to US$0.8 million or US$0.02 per diluted ADS as compared to US$1.0 million or US$0.03 per diluted ADS in the second quarter of 2009.

Third Quarter 2009 Financial Review (1)

Commenting on the results of the third quarter, Silicon Motion's President and CEO, Wallace Kou, said:



        "After many challenging quarters, we have finally delivered
    revenue growth.  Our markets remained challenging but we grew
    our mobile storage controller volume 21% and our overall
    revenue 14% sequentially.  As we had expected, NAND flash
    industry component volume started growing again this quarter as
    a result of higher NAND flash industry utilization rates and
    progress in migrating geometry to 40nm and 30nm.  Our retail
    and bundled businesses have both improved with the increased
    availability of flash.  However, we do not believe we are out
    of the woods yet.  NAND flash prices increased further in
    October and these high costs are being passed down to consumers
    in the form of higher retail prices for storage devices-and
    this in turn affects the momentum of our recovery.

        Nevertheless, we believe that we continue to be well
    positioned with the technological changes taking place in the
    dynamic NAND flash industry.  We have launched new controllers
    that support low cost 3-bits per cell MLC that Toshiba, SanDisk,
    and others are beginning to release to market.  We believe that
    3-bits per cell MLC, supported by advanced controller
    technologies, is well suited for meeting the cost and
    performance requirements of consumer storage applications and
    could in a few years time become the mainstream type of flash
    for the consumer market.  In addition to the release of our new
    3-bits per cell MLC controllers, we have also launched other
    new controllers: controllers that support 30nm NAND flash
    produced by vendors in addition to IM Flash, controllers that
    manage lower grade NAND flash, and controllers for card makers
    that want superior performance.

        This quarter, our mobile communications business started
    shipping our ISDB-T SoCs to Samsung for the Brazil market, a
    design-in that we had announced last quarter.  We also secured
    two CDMA transceiver design-ins with leading handset OEMs for
    the rapidly growing China market.  These two design-ins, as
    well as the CDMA design-in that we had previously announced,
    should start shipping in the fourth quarter to early 2010 time
    frame.  We believe that these new design-ins will serve as a
    strong base for long-term growth in our mobile communications
    business."

(1) Unless otherwise stated, all financial information used in this press release is unaudited, consolidated, prepared in accordance with US GAAP and denominated in New Taiwan dollars. US dollar amounts are translated for convenience only. Such financial information is generated internally and has not been subjected to the same review and scrutiny, including internal auditing procedures and audit by independent auditors, to which we subject our audited consolidated financial statements, and may vary materially from the audited consolidated financial information for the same period. Any evaluation of the financial information presented in this press release should also take into account our published audited consolidated financial statements and the notes to those statements. In addition, the financial information presented is not necessarily indicative of our results for any future period.

Sales

Net sales in the third quarter were US$23.1 million, an increase of 14% compared with the previous quarter. This quarter, mobile storage products accounted for 60% of net sales, mobile communications 27% of net sales, and multimedia SoCs 13% of net sales.

Net sales of mobile storage products, which include flash memory card controllers, USB flash drive controllers, card reader controllers, SSD controllers, and embedded flash controllers, increased 27% from the second quarter of 2009 to US$14.0 million this quarter.

Net sales of mobile communication products, which include mobile TV IC solutions, CDMA RF ICs, and electronic toll collection (ETC) RF ICs, decreased 8% from the second quarter of 2009 to US$6.2 million in the third quarter.

Net sales of multimedia SoC products, which include embedded graphics processors, PMP and DAB SoCs, and PC camera SoCs, increased 18% from the second quarter of 2009 to US$2.9 million this quarter.

Gross and Operating Margins

Gross margin excluding stock-based compensation was flat at 48.5% compared with the second quarter. GAAP gross margin increased slightly to 48.1% from 48.0% in the second quarter.

Operating expenses excluding stock-based compensation, acquisition-related charges, and one-time items were US$12.0 million, which were higher than the US$11.2 million reported for the second quarter. Research and development expenditures, excluding stock-based compensation, were US$7.3 million, which were higher than the US$6.8 million in the previous quarter. Selling and marketing expenses excluding stock-based compensation were US$2.4 million, which were unchanged from the previous quarter. General and administrative expenses excluding stock-based compensation and litigation expenses were US$2.2 million, a slight increase from the US$2.1 million reported in the previous quarter. Stock-based compensation was US$2.2 million in the third quarter, which was unchanged from the second quarter. Acquisition-related charges were US$1.5 million, which were also unchanged compared with the previous quarter. Litigation expenses were less than US$0.1 million in the third quarter, similar to the previous quarter.

Operating margin excluding stock-based compensation, acquisition-related charges, and one-time items was a negative 3.2%, an improvement from negative 6.7% in the previous quarter. GAAP operating margin also improved to a negative 19.3% compared with the negative 24.7% reported for the second quarter.

Other Income and Expenses

Net total other income excluding net foreign exchange gain or loss, and one-time items was US$0.1 million, which was unchanged from the previous quarter. GAAP net total other income was a loss of US$1.6 million, which was significantly lower than the loss of US$3.4 million in the previous quarter due primarily to lower foreign exchange loss in the third quarter.

Earnings

Net income excluding stock-based compensation, acquisition-related charges, net foreign exchange loss, and one-time items was US$0.8 million in this quarter, a decrease from US$1.0 million in the second quarter. The third quarter was positively impacted by a deferred tax benefit of US$1.4 million. Diluted earnings per ADS excluding stock-based compensation, acquisition-related charges, net foreign exchange gain (loss), and one-time items were US$0.02, a decrease from earnings per ADS of US$0.03 in the previous quarter.

GAAP net loss was US$4.7 million, which was an improvement from the net loss of US$6.2 million in the previous quarter. Diluted GAAP loss per ADS was US$0.16, an improvement compared to the loss per ADS of US$0.22 in the previous quarter.

Balance Sheet

Cash, cash equivalents, and short-term investments decreased slightly from US$60.7 million at the end of the second quarter of 2009 to US$60.6 million at the end of this quarter.

Cash Flow

Our cash flows were as follows:



                 3 months ended September 30, 2009
                 ---------------------------------

                                                     (In US$ millions)

 Net income (loss)                                               (4.7)
 Depreciation & amortization                                      2.7
 Changes in operating assets and liabilities                     (2.1)
 Others                                                           1.3
                                                                -----
   Net cash provided by (used in) operating activities           (2.8)
                                                                =====
 Acquisition of property and equipment                           (0.5)
 Others                                                           1.1
                                                                -----
   Net cash provided by (used in) investing activities            0.6
                                                                =====
 Others                                                            --
                                                                -----
   Net cash provided by (used in) financing activities             --
                                                                =====
 Effects of changes in foreign currency exchange rates on cash    1.5
                                                                -----

   Net decrease in cash and cash equivalents                     (0.7)
                                                                =====
 Pro-forma adjustment for foreign exchange translation            1.0
                                                                -----
   Pro-forma net increase in cash and cash equivalents            0.3
                                                                =====

During the third quarter of 2009, we spent US$0.5 million in capital expenditures primarily relating to the purchase of software and equipment. There were no shares repurchased in the third quarter.

Business Outlook:

Silicon Motion's President and CEO, Wallace Kou, added:



    "While our business has improved, we remain vigilant against
    unexpected changes in light of continued NAND flash volatility.
    NAND flash prices have risen in October and this will affect
    the near-term procurement of flash and controllers by our
    customers.  We are uncertain whether NAND flash prices will
    remain at these level, rise further or fall.  We do, however,
    believe that progress on the ramp of 30nm and 40nm flash, 3-
    bits per cell MLC, and lower grade flash will continue and
    demand for higher performance memory cards and other solid
    state storage device will increase.  We believe we remain very
    well positioned to capture opportunities in these growth
    areas."

For the fourth quarter of 2009, management expects:



 -- Revenue to be flat to up 10% sequentially
 -- Non-GAAP and GAAP gross margin to be in the 46% to 48% range
 -- Operating expenses excluding stock-based compensation,
    acquisition-related charges, and one-time items of
    approximately US$14 to US$15 million

Conference Call & Webcast:

The Company's management team will conduct a conference call at 8:00am Eastern Time on October 30, 2009.



  (Speakers)
  Wallace Kou, President & CEO
  Riyadh Lai, CFO
  Jason Tsai, Director of Investor Relations and Strategy

PRE-REGISTRATION:

https://www.theconferencingservice.com/prereg/key.process?key=PF66URCAB



  CONFERENCE CALL ACCESS NUMBERS:
  USA (Toll Free): 1 888 680 0860
  USA (Toll): 1 617 213 4852
  Taiwan (Toll Free): 0080 144 4360
  Participant Passcode: 1505 3765

  REPLAY NUMBERS (for 7 days):
  USA (Toll Free):1 888 286 8010
  USA (Toll): 1 617 801 6888
  Participant Passcode: 4872 6821

A webcast of the call will be available on the Company's website at www.siliconmotion.com.

Discussion of Non-GAAP Financial Measures

To supplement the Company's unaudited selected financial results calculated in accordance with U.S. Generally Accepted Accounting Principles ("GAAP"), the Company discloses certain non-GAAP financial measures that exclude stock-based compensation, acquisition-related charges and one-time items, including non-GAAP cost of sales, non-GAAP gross profit, non-GAAP operating expenses, non-GAAP operating income, non-GAAP net income, and non-GAAP earnings per diluted ADS. These non-GAAP measures are not in accordance with or an alternative for GAAP, and may be different from non-GAAP measures used by other companies. We believe that these non-GAAP measures have limitations in that they do not reflect all the amounts associated with the Company's results of operations as determined in accordance with GAAP and that these measures should only be used to evaluate the Company's results of operations in conjunction with the corresponding GAAP measures. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the most directly comparable GAAP measure. We compensate for the limitations of our non-GAAP financial measures by relying upon GAAP results to gain a complete picture of our performance.

Our non-GAAP financial measures are provided to enhance the user's overall understanding of our current financial performance and our prospects for the future. Specifically, we believe the non-GAAP results provide useful information to both management and investors as these non-GAAP results exclude certain expenses, gains and losses that we believe are not indicative of our core operating results and because it is consistent with the financial models and estimates published by many analysts who follow the Company. We use non-GAAP measures to evaluate the operating performance of our business, for comparison with our forecasts, and for benchmarking our performance externally against our competitors. Also, when evaluating potential acquisitions, we exclude the items described below from our consideration of the target's performance and valuation. Since we find these measures to be useful, we believe that our investors benefit from seeing the results from management's perspective in addition to seeing our GAAP results. We believe that these non-GAAP measures, when read in conjunction with the Company's GAAP financials, provide useful information to investors by offering:



 -- the ability to make more meaningful period-to-period
    comparisons of the Company's on-going operating results;
 -- the ability to better identify trends in the Company's
    underlying business and perform related trend analysis;
 -- a better understanding of how management plans and measures the
    Company's underlying business; and
 -- an easier way to compare the Company's operating results
    against analyst financial models and operating results of our
    competitors that supplement their GAAP results with non-GAAP
    financial measures.

The following are explanations of each of the adjustments that we incorporate into our non-GAAP measures, as well as the reasons for excluding each or these individual items in our reconciliation of these non-GAAP financial measures:

Stock-based compensation expense consists of non-cash charges incurred as a result of the Company's adoption of SFAS 123R relating to the fair value of stock options and restricted stock units awarded to employees. The Company believes that the exclusion of these non-cash charges provides for more accurate comparisons of our operating results to our peer companies due to the varying available valuation methodologies, subjective assumptions and the variety of award types. In addition, the Company believes it is useful to investors to understand the specific impact the application of SFAS 123R has on our operating results.

Intangible amortization consists of non-cash charges that can be impacted by the timing and magnitude of our acquisitions. We consider our operating results without these charges when evaluating our ongoing performance and forecasting our earnings trends, and therefore excludes such charges when presenting non-GAAP financial measures. We believe the assessment of our operations excluding these costs is relevant to our assessment of internal operations and comparisons to the performance of our competitors.

Litigation expenses consist of the legal expenses relating to complaints SanDisk filed in the US International Trade Commission and the US District Court for the Western District of Wisconsin.

Impairment losses on long-term investment relates to the other-than-temporary, non-operating write down of the Company's minority stake investment in Vastview Technology Corp. The investment was written down after the Company determined that it was other-than-temporarily impaired.

Foreign exchange gains and losses consists of translation gains and/or losses of non-NT$ denominated current assets and current liabilities, as well as certain other balance sheet items which result from the appreciation or depreciation of non-NT$ currencies against the NT$.



                   Silicon Motion Technology Corporation
                     Consolidated Statements of Income
    (in thousands, except percentages and per ADS data, unaudited)

                            For the Three Months Ended
                ------------------------------------------------------
                                                 Sep.    Jun.    Sep.
                 Sep. 30,  Jun. 30,   Sep. 30,    30,     30,     30,
                   2008      2009       2009     2008    2009    2009
                  (NT$)      (NT$)     (NT$)     (US$)   (US$)   (US$)
                ---------  --------  ---------  ------  ------  ------

 Net Sales      1,402,544   673,625    759,427  44,953  20,314  23,132

 Cost of sales    701,300   350,159    394,448  22,477  10,560  12,015
                ---------  --------  ---------  ------  ------  ------
 Gross profit     701,244   323,466    364,979  22,476   9,754  11,117
 Operating
  expenses
   Research &
    development   277,440   264,026    279,293   8,892   7,962   8,507
   Sales &
    marketing     106,347    87,984     94,200   3,409   2,653   2,869
   General &
    admini-
    strative      141,246    89,528     89,926   4,527   2,700   2,739
   Amortization
    of intang-
    ibles
    assets         48,626    48,081     48,151   1,559   1,450   1,467
                ---------  --------  ---------  ------  ------  ------
 Operating
  income (loss)   127,585  (166,153)  (146,591)  4,089  (5,011) (4,465)

 Non-operating
  income
  (expense)

   Gain on
    sale of
    investments     1,774        44         22      57       1       1
   Unrealized
    holding
    gain
    (loss) on
    marketable
    securities        673        --         --      22      --      --
   Interest
    income
    (net)           9,419     5,220      4,328     302     157     132
   Impairment
    on long-
    term
    investment         --        --     (6,472)     --      --    (197)
   Foreign
    exchange
    gain (loss)   120,190  (115,396)   (49,402)  3,852  (3,480) (1,506)
   Others               6    (1,987)         6      --     (59)     --
                ---------  --------  ---------  ------  ------  ------
   Subtotal       132,062  (112,119)   (51,518)  4,233  (3,381) (1,570)
                ---------  --------  ---------  ------  ------  ------
 Income (loss)
  before tax      259,647  (278,272)  (198,109)  8,322  (8,392) (6,035)
 Income tax
  expense
  (benefit)         6,258   (73,723)   (44,971)    201  (2,223) (1,370)
                ---------  --------  ---------  ------  ------  ------
 Net income
  (loss)          253,389  (204,549)  (153,138)  8,121  (6,169) (4,665)
                =========  ========  =========  ======  ======  ======
 Basic
  earnings
  (loss)
  per ADS       $    8.26    ($7.38)    ($5.51) $ 0.26  ($0.22) ($0.17)
 Diluted
  earnings
  (loss)
  per ADS       $    8.22    ($7.21)    ($5.31) $ 0.26  ($0.22) ($0.16)

 Margin
  Analysis:
 Gross margin       50.0%     48.0%      48.1%   50.0%   48.0%   48.1%
 Operating
  margin             9.1%    (24.7%)    (19.3%)   9.1%  (24.7%) (19.3%)
 Net margin         18.1%    (30.4%)    (20.2%)  18.1%  (30.4%) (20.2%)

 Weighted
  avg. ADS(2):
 Basic             30,681    27,728     27,775  30,681  27,728  27,775
 Diluted           30,825    28,375     28,843  30,825  28,375  28,843

 ---------------------------------------------------------------------

 (2) Assumes all outstanding ordinary shares are represented by ADSs.
     Each ADS represents four ordinary shares.

                Silicon Motion Technology Corporation
           Reconciliation of GAAP to Non-GAAP Operating Results
   (in thousands, except percentages and per ADS data, unaudited)

                            For the Three Months Ended
                ------------------------------------------------------
                                                 Sep.    Jun.    Sep.
                 Sep. 30,  Jun. 30,  Sep. 30,     30,     30,     30,
                   2008      2009       2009     2008    2009    2009
                  (NT$)      (NT$)     (NT$)     (US$)   (US$)   (US$)
                ---------  --------  ---------  ------  ------  ------
 GAAP net
  income (loss)   253,389  (204,549)  (153,138)  8,121  (6,169) (4,665)
 Stock-based
  compensation:
   Cost of
    sales           3,799     3,406      3,223     122     103      98
   Research
    and
    development    37,057    38,953     39,265   1,188   1,175   1,196
   Sales and
    marketing      15,199     9,907     15,066     487     299     459
   General and
    admini-
    strative       16,818    19,134     15,700     539     577     478
                ---------  --------  ---------  ------  ------  ------
     Total
      stock-
      based
      compens-
      ation        72,873    71,400     73,254   2,336   2,154   2,231
                ---------  --------  ---------  ------  ------  ------

 Acquisition
  related
  charges:
   Amortiz-
    ation of
    intangible
    assets         48,626    48,081     48,151   1,559   1,450   1,467
 Litigation
  expenses         16,975     1,538      1,073     544      46      32
 Foreign
  exchange
  loss (gain)    (120,190)  115,396     49,402  (3,852)  3,480   1,506
 Impairment on
  long-term
  investment           --        --      6,472      --      --     197
                ---------  --------  ---------  ------  ------  ------

 Non-GAAP
  net income      271,673    31,866     25,214   8,708     961     768
                =========  ========  =========  ======  ======  ======
 Weighted avg.
  ADS (non-
  GAAP):
   Basic           30,681    27,728     27,775  30,681  27,728  27,775
                =========  ========  =========  ======  ======  ======
   Diluted         31,805    30,710     31,641  31,805  30,710  31,641
                =========  ========  =========  ======  ======  ======
 Non-GAAP
  basic
  earnings
  (loss)
  per ADS       $    8.85  $   1.15  $    0.91  $ 0.28  $ 0.03  $ 0.03
                =========  ========  =========  ======  ======  ======
 Non-GAAP
  diluted
  earnings
  (loss)
  per ADS       $    8.54  $   1.04  $    0.80  $ 0.27  $ 0.03  $ 0.02
                =========  ========  =========  ======  ======  ======
 Non-GAAP
  gross margin      50.3%     48.5%      48.5%   50.3%   48.5%   48.5%
 Non-GAAP
  operating
  margin            19.0%     (6.7%)     (3.2%)  19.0%   (6.7%)  (3.2%)
 ---------------------------------------------------------------------

                Silicon Motion Technology Corporation
                  Consolidated Statements of Income
        (in thousands, except percentages, and per ADS data)
                             (unaudited)

                                      For the Nine Months Ended
                                --------------------------------------
                                 Sep. 30,   Sep. 30,  Sep. 30, Sep. 30,
                                   2008       2009      2008     2009
                                   (NT$)      (NT$)     (US$)    (US$)
                                ---------  ---------  -------  -------

 Net Sales                      4,464,364  2,165,076  143,805   64,972
 Cost of sales                  2,258,767  1,155,769   72,759   34,683
                                ---------  ---------  -------  -------
 Gross profit                   2,205,597  1,009,307   71,046   30,289
 Operating expenses
   Research & development         808,850    762,968   26,054   22,896
   Sales & marketing              271,021    261,924    8,730    7,860
   General & administrative       414,475    275,401   13,351    8,265
   Amortization of intangible
    assets                        145,899    144,109    4,700    4,325
                                ---------  ---------  -------  -------
 Operating income (loss)          565,352   (435,095)  18,211  (13,057)

 Non-operating  income (expense)
   Gain on sale of investments     16,839        223      542        7

   Unrealized holding gain
    (loss) on marketable
    securities                       (449)        --      (14)      --
   Interest income (net)           30,448     15,066      980      452
   Dividend income                  2,239         --       72       --
   Impairment losses on
    long-term
    investment                         --     (6,472)      --     (194)
   Foreign exchange gain (loss)    30,916    (78,365)     996   (2,352)
   Others                             186     (2,132)       7      (64)
                                ---------  ---------  -------  -------
   Subtotal                        80,179    (71,680)   2,583   (2,151)
                                ---------  ---------  -------  -------
 Income (loss) before tax         645,531   (506,775)  20,794  (15,208)
 Income tax expense (benefit)      81,358   (101,259)   2,621   (3,039)
                                ---------  ---------  -------  -------
 Net income (loss)                564,173   (405,516)  18,173  (12,169)
                                =========  =========  =======  =======
 Basic earnings (loss)
  per ADS                       $   17.53    ($14.68) $  0.56   ($0.44)
                                =========  =========  =======  =======
 Diluted earnings (loss)
  per ADS                       $   17.32    ($14.31) $  0.56   ($0.43)
                                =========  =========  =======  =======
 Margin Analysis:
 Gross margin                       49.4%      46.6%    49.4%    46.6%
 Operating margin                   12.7%     (20.1%)   12.7%   (20.1%)

 Weighted average ADS:
 Basic                             32,183     27,619   32,183   27,619
 Diluted                           32,583     28,334   32,583   28,334


                 Silicon Motion Technology Corporation
         Reconciliation of GAAP to Non-GAAP Operating Results
    (in thousands, except percentages and per ADS data, unaudited)

                                       For the Nine Months Ended
                                --------------------------------------
                                 Sep. 30,   Sep. 30,  Sep. 30, Sep. 30,
                                   2008       2009      2008     2009
                                   (NT$)      (NT$)     (US$)    (US$)
                                ---------  ---------  -------  -------

 GAAP net income (loss)           564,173   (405,516)  18,173  (12,169)
 Stock-based compensation:
   Cost of sales                    9,930      8,746      320      262
   Research and development       107,581    106,271    3,466    3,189
   Sales and marketing             40,799     36,242    1,314    1,088
   General and administrative      49,788     49,940    1,604    1,499
                                ---------  ---------  -------  -------
     Total stock-based
      compensation                208,098    201,199    6,704    6,038
                                ---------  ---------  -------  -------

 Acquisition related charges:
 Amortization of intangible
  assets                          145,899    144,109    4,700    4,325
 Litigation expenses               56,100      3,902    1,807      117

   Impairment losses on
    long-term investment               --      6,472       --      194

 Foreign exchange loss (gain)     (30,916)    78,365     (996)   2,352

 FIN 48 tax charge                 64,328         --    2,072       --
                                ---------  ---------  -------  -------
 Non-GAAP net income            1,007,682     28,531   32,460      857
                                =========  =========  =======  =======

 Weighted avg. ADS (non-GAAP):
   Basic                           32,183     27,619   32,183   27,619
                                =========  =========  =======  =======
   Diluted                         33,610     30,401   33,610   30,401
                                =========  =========  =======  =======

 Non-GAAP basic earnings
  per ADS                       $   31.31  $    1.03  $  1.01  $  0.03
                                =========  =========  =======  =======
 Non-GAAP diluted earnings
  per ADS                       $   29.98  $    0.94  $  0.97  $  0.03
                                =========  =========  =======  =======

 Non-GAAP gross margin              49.6%      47.0%    49.6%    47.0%
 Non-GAAP operating margin          21.9%      (4.0%)   21.9%    (4.0%)


                Silicon Motion Technology Corporation
                     Consolidated Balance Sheet
                            (In thousands)
                             (unaudited)

            Sep. 30,   Jun. 30,   Sep. 30,  Sep. 30, Jun. 30, Sep. 30,
              2008       2009       2009      2008     2009     2009
              (NT$)      (NT$)      (NT$)     (US$)    (US$)    (US$)
           ---------- ---------- ---------- -------- -------- --------
 Cash and
  cash
  equival-
  ents      1,761,752  1,955,309  1,932,867   54,662   59,306   59,601
 Short-term
  invest-
  ments       154,438     45,136     33,143    4,792    1,369    1,022
 Accounts
  receiv-
  able
  (net)     1,241,724    569,107    610,342   38,527   17,261   18,820
 Inventories  715,509    473,453    517,689   22,200   14,360   15,963
 Refundable
  deposits
  - current    69,966     81,376     66,167    2,171    2,468    2,040
 Deferred
  income
  tax
  assets
  (net)       100,555     48,226     80,298    3,120    1,463    2,476
 Prepaid
  expenses
  and other
  current
  assets      154,006    151,904    102,925    4,778    4,607    3,175
           ---------- ---------- ---------- -------- -------- --------
 Total
  current
  assets    4,197,950  3,324,511  3,343,431  130,250  100,834  103,097

 Long-term
  invest-
  ments       119,475     50,371     17,908    3,707    1,528      552
 Property
  and
  equipment
  (net)       875,421    875,680    858,085   27,162   26,560   26,460
 Goodwill
  and
  intang-
  ible
  assets
  (net)     2,691,141  2,544,420  2,499,051   83,498   77,174   77,061
 Other
  assets      208,760    288,471    312,997    6,477    8,750    9,650
           ---------- ---------- ---------- -------- -------- --------
 Total
  assets   $8,092,747 $7,083,453 $7,031,472 $251,094 $214,846 $216,820
           ========== ========== ========== ======== ======== ========
 Short-term
  borrowing   105,071         --         --    3,260       --       --
 Accounts
  payable     487,000    276,453    299,688   15,110    8,385    9,241
 Income
  tax
  payable     187,745    147,029     38,713    5,825    4,459    1,194
 Accrued
  expenses
  and other
  current
  liabil-
  ities       514,035    372,025    426,336   15,949   11,284   13,146
           ---------- ---------- ---------- -------- -------- --------
 Total
  current
  liabil-
  ities     1,293,851    795,507    764,737   40,144   24,128   23,581
 Long-
  term
  liabil-
  ities        42,276     65,712     61,287    1,312    1,993    1,890
 Other
  liabil-
  ities        55,884     41,602     45,572    1,734    1,263    1,405
           ---------- ---------- ---------- -------- -------- --------
 Total
  liabil-
  ities     1,392,011    902,821    871,596   43,190   27,384   26,876
 Share-
  holders'
  equity    6,700,736  6,180,632  6,159,876  207,904  187,462  189,944
           ---------- ---------- ---------- -------- -------- --------
 Total
  liabil-
  ities &
  share-
  holders'
  equity   $8,092,747 $7,083,453 $7,031,472 $251,094 $214,846 $216,820
           ========== ========== ========== ======== ======== ========
 ---------------------------------------------------------------------
 Note: The Company maintains its accounts and expresses its financial
 statements in New Taiwan dollars. For convenience only, U.S. dollar
 amounts presented in the income statement have been translated from
 New Taiwan dollars, using an average exchange rate of NT$31.20 to US$1
 for 3Q08, NT$33.16 to US$1 for 2Q09, and NT$32.83 to US$1 for 3Q09
 based on the average of the historical exchange rate of the Oanda
 Corporation. Amounts from the balance sheet have been translated using
 the ending exchange rate for the period. The exchange rate was
 NT$32.23 to US$1 at the end of 3Q08, NT$32.97 to US$1 at the end of
 2Q09, and NT$32.43 to US$1 at the end of 3Q09.

About Silicon Motion:

We are a fabless semiconductor company that designs, develops and markets high performance, low-power semiconductor solutions for the multimedia consumer electronics market. We have three major product lines: mobile storage, mobile communications, and multimedia SoCs. Our mobile storage business is composed of microcontrollers used in NAND flash memory storage products such as flash memory cards, USB flash drives, SSDs, embedded flash applications, and card readers. Our mobile communications business is composed of mobile TV IC solutions, CDMA RF ICs, and electronic toll collection RF ICs. Our multimedia SoCs business is composed of products that support portable multimedia players, DAB systems, PC cameras, and embedded graphics applications.

Forward-Looking Statements:

This press release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including without limitation, statements about Silicon Motion's expected third quarter 2009 revenue, gross margin and operating expenses, all of which reflect management's estimates based on information available at this time of this press release. While Silicon Motion believes these estimates to be meaningful, these amounts could differ materially from actual reported amounts for the third quarter. Forward-looking statements also include, without limitation, statements regarding trends in the multimedia consumer electronics market and our future results of operations, financial condition and business prospects. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "expect," "intend," "plan," "anticipate," "believe," "estimate," "predict," "potential," "continue," or the negative of these terms or other comparable terminology. Although such statements are based on our own information and information from other sources we believe to be reliable, you should not place undue reliance on them. These statements involve risks and uncertainties, and actual market trends or our actual results of operations, financial condition or business prospects may differ materially from those expressed or implied in these forward looking statements for a variety of reasons. Potential risks and uncertainties include, but are not limited to, our belief in the outcome of any claim or lawsuit, including those uncertainties relating to litigation filed against the Company relating to whether its products are covered by patents not owned by the Company; unpredictable volume and timing of customer orders, which are not fixed by contract but vary on a purchase order basis; the loss of one or more key customers or the significant reduction, postponement, rescheduling or cancellation of orders from these customers; integration of our recently announced acquisitions; general economic conditions or conditions in the semiconductor or consumer electronics markets; decreases in the overall average selling prices of our products; changes in the relative sales mix of our products; changes in our cost of finished goods; the availability, pricing, and timeliness of delivery of other components and raw materials used in our customers' products; our customers' sales outlook, purchasing patterns, and inventory adjustments based on consumer demands and general economic conditions, including the general global economic slowdown as it effects the Company, its customers and consumers; our ability to successfully develop, introduce, and sell new or enhanced products in a timely manner; and the timing of new product announcements or introductions by us or by our competitors. For additional discussion of these risks and uncertainties and other factors, please see the documents we file from time to time with the Securities and Exchange Commission, including our Annual Report on Form 20-F filed on July 14, 2009. We assume no obligation to update any forward-looking statements, which apply only as of the date of this press release.

This news release was distributed by GlobeNewswire, www.globenewswire.com

SOURCE: Silicon Motion Technology Corporation

CONTACT:  Silicon Motion Technology Corporation
Investor Contact:
Jason Tsai, Director of IR and Strategy
+1 408 519 7259
Fax: +1 408 519 7101
jtsai@siliconmotion.com
Investor Relations
Selina Hsieh
+886 3 552 6888 x2311
Fax: +886 3 560 0336
ir@siliconmotion.com
Media Contact:
Sara Hsu, Project Manager
+886 2 2219 6688 x3509
Fax: +886 2 2219 6868
sara.hsu@siliconmotion.com