GlobeNewswire Inc | Aug 5, 2021 05:20AM EDT

August 05, 2021

Company Q2 2021 Revenues and Gross Margin were Both at the Upper Range of the Guidance. EPS Exceeded the Guidance; Revenues, Gross Margin and EPS, Again, All Reached All-Time Highs

Provides Q3 2021 Guidance: Revenues to Increase by 13% to 17% sequentially, Gross Margin is expected to be in the range of 50.5% to 52.0%,Non-IFRS Profit per Diluted ADS to be around75.0 Cents to81.0 Cents, and IFRS Profit per Diluted ADS to be around63.0 Cents to69.0 Cents

-- Revenues, gross margin and EPS all reached all-time highs in Q2 2021 -- Q2revenues was $365.3M, an increase of 18.2% QoQ. Exceeded the guidance of an increase of around 15-20%. Continuous strong demands across all major business segments in Q2 -- Q2 gross margin reached 47.5%, significantly up from the 40.2% in Q1 2021. Positioned at upper range of the guidance of 45.5% - 47.5% -- Product sales: large driver ICs, 23.4% of revenues, up 22.2% QoQ; small and medium-sized driver ICs, 63.1% of revenues, up 13.0% QoQ; non-driver products, 13.5% of revenues, up more than 40% QoQ -- Capacity shortage remained across all business segments in Q2. Company continued to strategically allocate assessible capacity favoring high margin product areas and key customers -- Q2 non-IFRS after-tax profit was $109.1M, or 62.4 cents per diluted ADS. Exceeded the guidance of 54.2 cents to 60.2 cents per diluted ADS -- Q2 non-IFRS operating income was $134.3 million, or 36.8% of sales, versus 27.5% of sales in the last quarter. Again, both operating income and operating margin reached historical highs -- Decent sequential increases in monitor and NB IC businesses in Q2 thanks to persisting demand for WFH/LFH. TV revenue was up an impressive double-digit QoQ mainly due to strong shipments of high-end TV products, including those to a world-leading end customer, as reported in last earnings call -- SMDDIC saw continued strong momentum in Q2, where automotive segment grew more than 22% QoQ, the highest growth among SMDDIC businesses. Q2 tablet sales continued tobreak sales records and accounted for more than 23% of total sales, slightly above smartphone IC business in weighting -- Q2 Tablet TDDI sales were up more than 30% QoQ which illustrated Companys market leadership in non-iOS tablet and TDDIs increasing penetration in the tablet market. Q2 Smartphone TDDI posted low single digit sequential growth due to the Companys capacity allocation decision -- Himax is the pioneer in the world of automotive TDDI development, having started the first generation TDDI mass production as early as the Q2 2019. Further upgraded its design and now Himaxs Gen 2 TDDI for automotive has officially entered into mass production in Q3 with dominating design-win coverage across literally all display makers, numerous Tier-1 players and leading car manufactures across all automotive markets -- Q2 Tcon business registered a remarkable over 60% QoQ. Company anticipates Q3 Tcon sales to up mid-teens QoQ from some of the high value products areas such as 4K/8K TV, gaming monitor, and low power notebook -- For Himaxs WiseEye solution business,the Company is pleased to report new awards during Q2 from utility meter, battery camera and panoramic video conferencing applications. Some of these applications are expected to enter into mass production beginning Q4 2021 -- In view of the foundry shortage and growing demand, the Company has entered into strategic agreements with foundry partners to cover both short-term and long-term needs.Likewise, Company is entering into strategic agreements with customers, including indirect end customers, who wish to secure IC supplies. All such contractual arrangements will help boost Himaxs future growth prospect and improve earnings visibility. Looking further ahead, Himax expects to also secure more capacity for 2022 as compared to 2021

TAINAN, Taiwan, Aug. 05, 2021 (GLOBE NEWSWIRE) -- Himax Technologies, Inc. (Nasdaq: HIMX) (Himax or Company), a leading supplier and fabless manufacturer of display drivers and other semiconductor products, announced its financial results for the second quarter ended June 30, 2021.

The semiconductor industry continues to go through a severe foundry shortage, especially in the mature process nodes where we are mainly anchored. With foundries running at more than full capacity while demand shows no indication of abating, the long-lasting unaddressed supply-demand imbalance remains. In view of the foundry shortage and anticipated growing demand for the foreseeable future, we have entered into strategic agreements with foundry partners to cover both our short-term and long-term needs. We are in the process of entering into further such agreements as we speak, with some of them involving new foundry partners, leaving nothing untried to expand our capacity pool. Likewise, across various product lines, we are entering into strategic agreements with customers who wish to secure their IC supplies. Some of them are indirect customers who dont necessarily source ICs directly from us but still wish to enter into supply deals with us to ensure that their direct vendors, mostly panel makers in our case, will get their desired supply quantities from us. All such contractual arrangements will help boost our future growth prospects and improve earnings visibility, said Mr. Jordan Wu, President and Chief Executive Officer of Himax.

Notwithstanding all these efforts, demand continues to outpace supply and we believe the imbalance could last well into 2022. However, we are on track for more accessible capacity to grow our business quarter by quarter this year. Looking further ahead, we expect to also secure more capacity for 2022 as compared to this year. We will provide more details as they come available, concluded Mr. Jordan Wu.

Second Quarter 2021 Financial Results

Himax recorded net revenues of $365.3 million, an increase of 18.2% sequentially and an increase of 95.3% compared to the same period last year. The sequential increase was at the upper range of the guidance of an increase of around 15-20% quarter-over-quarter. Gross margin was 47.5%, at the upper range of the guidance of 45.5% to 47.5% and a significant 7.3 percentage points improvement from the 40.2% of the first quarter 2021. Non-IFRS profit per diluted ADS was 62.4 cents, exceeding its guidance of 54.2 cents to 60.2 cents. IFRS profit per diluted ADS was 62.3 cents, exceeding its guidance of 54.0 cents to 60.0 cents.

Revenue from large display drivers was $85.4 million, up 22.2% sequentially and up 43.7% year-over-year with sales growing through all three major product areas, namely TV, monitor and notebook. Both monitor and notebook IC revenues delivered decent sequential increases thanks to continuous home working and distance education demands. TV revenue was up an impressive double-digit quarter-over-quarter mainly due to strong shipments of high-end TV products, including those to a world-leading end customer, as the Company indicated in the last earnings call. Large panel driver ICs accounted for 23.4% of total revenues for this quarter, compared to 22.6% in the first quarter of 2021 and 31.8% a year ago.

Small and medium-sized display drivers saw continued strong momentum with revenue of $230.6 million, up 13.0% sequentially and up 133.4% year-over-year. Automotive segment delivered a more than 22% sequential increase in Q2, the highest growth among the three segments in the small and medium-sized driver IC business. TDDI for tablet was up more than 30% sequentially, a continuation from the high base last quarter, while smartphone TDDI posted low single digit sequential growth. Small and medium-sized segment accounted for 63.1% of total sales for the quarter, compared to 66.1% in the previous quarter and 52.8% a year ago.

The second quarter smartphone sales came in better-than-expected, with revenue reaching $83.9 million, up more than 200% compared to the same period last year. The smartphone segment represented around 23% of total sales in Q2.Company's smartphone TDDI sales were still capped by severe capacity constraint and as the Company explained before, it continued to strategically allocate more capacity to tablet TDDI at the expense of smartphone shipment as the Company was the major supplier in the tablet TDDI market. Sales of traditional smartphone DDICs grew nicely as expected with seasonal demand. As mentioned several times before, traditional smartphone DDICs are quickly being replaced by TDDI and AMOLED.

Tablet revenue continued to break sales records, reaching $85.3 million in Q2. Tablet sales grew 17.0% sequentially and doubled year-over-year, reflecting strong market demand from home working and online learning as well as its market share gains. Tablet revenue accounted for more than 23% of total sales in the second quarter, slightly above its smartphone IC business in weighting. While Company's tablet TDDI sales continued an uninterrupted growth streak since the products initial mass production in the first quarter of 2020, Himaxs shipments were still limited by the ongoing industry-wide capacity shortage. The accelerated growth, however, illustratedHimax's market leadership in non-iOS tablet market and TDDIs increasing penetration in the tablet market. Revenue of traditional discrete driver ICs for tablet was flat sequentially in the second quarter as the market continued to be quickly replaced by TDDI.

Second quarter driver IC revenue for automotive amounted to $53.3 million, up 22.1% sequentially and more than doubled year-over-year, while demand continued to outpace supply. Automotive driver IC business accounted for around 15% of total revenues in the quarter. As predicted in the last earnings call, the Company expects its automotive shipment to grow quarter over quarter in 2021 and into next year.

Second quarter revenue from its non-driver businesses was $49.3 million, up more than 40% sequentially and up more than 70% year-over-year. Tcon business registered a remarkable growth of over 60% sequentially, up more than 130% year-over-year. Non-driver products accounted for 13.5% of total revenue, as compared to 11.3% in the first quarter of 2021 and 15.4% a year ago.

Gross margin for the second quarter was 47.5%, up from 40.2% of the previous quarter and greatly increased from 21.0% of the same period last year.

Non-IFRS operating expenses for the second quarter were $39.3 million, little changed from the previous quarter but up 5.7% from a year ago mainly because of increased salary.

Reflecting higher sales and better gross margin, non-IFRS operating income was $134.3 million, or 36.8% of sales, versus 27.5% of sales in the last quarter. Again, both operating income and operating margin reached historical highs. Non-IFRS after-tax profit was $109.1 million, or 62.4 cents per diluted ADS, a new record high and greatly up from $67.1 million, or 38.4 cents per diluted ADS, of the last quarter.

Balance Sheet and Cash Flow

Himax had $270.4 million of cash, cash equivalents and other financial assets as of June 30, 2021, compared to $107.1 million at the same time last year and $245.8 million a quarter ago. The higher cash balance was derived mainly from $85.2 million of operating cash inflow during the quarter, offset by the $59.6 million cash outflow for refundable deposits made for the purpose of securing foundry capacity. Restricted cash was $112.1 million at the end of Q2, compared to $114.8 million a quarter ago and $164.0 million a year ago. The restricted cash was mainly used to guarantee the short-term secured borrowings for the same amount. The Company had $55.5 million of long-term unsecured loans as of the end of Q2, of which $6.0 million was current portion.

The Companys quarter-end inventories as of June 30, 2021 were $134.2 million, up from $114.9 million last quarter and down from $161.5 million a year ago. Compared to the prior year, its inventory remains at lower levels as customers request finished goods delivery as soon as they are available, reflecting the prolonged supply-demand imbalance. As the overall semiconductor industry is unlikely to have sizable capacity increases anytime soon while demand far outpaces supply, the Company anticipates similar level of inventory position in the next few quarters. Accounts receivable at the end of June 2021 was $329.0 million, up from $289.1 million last quarter and up from $206.1 million a year ago due to higher sales. DSO was 88 days at the quarter end, as compared to 101 days a year ago and 84 days at the end of the last quarter.

Net cash inflow from operating activities amounted to $85.2 million as compared to an inflow of $60.3 million last quarter and an outflow of $9.2 million for the same period last year. Investing activities saw a net cash outflow of $58.2 million during the second quarter mainly because of a net increase of $59.6 million in refundable deposits that the Company made during the second quarter for the purpose of securing foundry capacity. Also as part of investing activities, second quarter capital expenditures were $1.4 million, versus $2.0 million last quarter and $0.7 million a year ago. The second quarter capex was mainly for R&D related equipment of IC design business.

The Company declared an annual cash dividend of 27.2 cents per ADS during the second quarter, totaling $47.4 million and equivalent to 100% of last years net profit. The dividend was paid out on July 12, 2021. As before, Himaxs dividend was determined primarily by the prior years profitability. Companys decision to pay out full net profit of last year demonstrated the managements strong confidence for its business prospect.

Outstanding Share

As of June 30, 2021, Himax had 174.3 million ADS outstanding, little changed from last quarter. On a fully diluted basis, the total number of ADS outstanding was 174.7 million.

Q3 2021 Outlook

The semiconductor industry continues to go through a severe foundry shortage, especially in the mature process nodes where the Company is mainly anchored. With foundries running at more than full capacity while demand shows no indication of abating, the long-lasting unaddressed supply-demand imbalance remains. In view of the foundry shortage and anticipated growing demand for the foreseeable future, Himax has entered into strategic agreements with foundry partners to cover both short-term and long-term needs. Himax is in the process of entering into further such agreements, with some of them involving new foundry partners, leaving nothing untried to expand its capacity pool. Likewise, across various product lines, the Company is entering into strategic agreements with customers who wish to secure their IC supplies. Some of them are indirect customers who dont necessarily source ICs directly from Himax but still wish to enter into supply deals with the Company to ensure that their direct vendors, mostly panel makers in Company's case, will get their desired supply quantities from Himax. All such contractual arrangements will help boostCompany's future growth prospects and improve earnings visibility.

Notwithstanding all these efforts, demand continues to outpace supply and the Company believes the imbalance could last well into 2022. However, Himax is on track for more accessible capacity to grow its business quarter by quarter this year. Looking further ahead, the Company expects to also secure more capacity for 2022 as compared to this year. Will provide more details as they come available.

Display Driver IC Businesses

LDDIC

Himax expects Q3 large display driver IC revenue is projected to increase more than 30% sequentially with all the three major product lines set for further growth. In Q3, it expects both monitor and notebook businesses to post double-digit growth, benefiting from remote work and online schooling trends. For TV segment, it expects over 20% sequential growth in Q3 anchored by higher-end and larger-sized TVs, despite the slight dip in worldwide TV shipments anticipated for the second half. While demand remains resilient for Himax, supply still falls well short of demand fulfillment.

As consumers spend more time indoors and the number of connected devices per household is rising steadily, the Company is seeing more demand for advanced displays, such as higher resolution TV, higher refresh rate monitor, and ultra-large-sized, high-aspect-ratio curved-view displays. Himax continues to lead the high-end TV and gaming monitor markets by offering major panel makers and end customers total solutions of Company's driver ICs and advanced Tcons together. In addition, Himax is also working on next generation notebook DDICs, shooting for high-end and low power consumption features to enhance its product portfolio and market share gains.

SMDDIC

In Q3, revenue is expected to increase bylow-teens sequentially and around 70% year-over-year, driven by persisting demand for tablet and automotive segments, while sales for smartphone are expected to see single digit decline. In Q3, the automotive driver business is set to grow by more than 30% sequentially and more than 150% year-over-year, once again showing the highest growth among the three segments in the small and medium-sized driver IC business. In early 2020, foreseeing the foundry shortage, Himax secured a long-termagreement with its strategic foundry partner to enlarge Company's capacity specifically for the automotive application. While the capacity accessible to the Company is still far behind customer demands right now, it has been able to grow its shipment and sales amidst the prevailing shortage especially for automotive ICs. As for the tablet market, the Company remains committed to allocating capacity in favor of tablet over smartphone to strengthen its leading position in the tablet driver market. For the third quarter, the Company expects tablet sales to grow by mid-teens and smartphone sales to be down single digit compared to the previous quarter, reflecting its capacity allocation decision. Again, Himax is unable to meet all customer demands due to tight foundry capacity.

Sales growth for tablet IC business is expected to extend into the third quarter thanks to robust consumer demand driven by unprecedented stay-at-home lifestyle. Tablet sales are expected to account for the highest proportion of all the product lines in Q3, benefitting from the proactive adoption by all leading non-iOS tablet names of the Companys TDDI solutions. Its worth highlighting that Himax is the dominant tablet TDDI player in non-iOS market, taking more than 60% market share.

Himax continues to lead in the next generation tablet TDDI technology by offering state-of-the-art solutions for higher frame rate, higher resolution, larger screen size and more accurate active stylus designs. Himax is glad to report that recently it started mass production for the worlds first 12.4 WQXGA super high-resolution tablet with a leading end customer. In addition, the Company successfully piloted its tablet TDDI solution for the fast-expanding education tablet, a market with great potential. For the third quarter, the Company expects tablet TDDI sales to grow mid-teens. Revenue of traditional DDIC for tablet is expected to increasehigh single digitsequentially.

The worldwide smartphone market confronted a short-term headwind from the recent spreading of the pandemic in the Southern Asia. However, the Companys demand for smartphone still far surpasses supply. Limited by the total accessible capacity, it continues to strategically allocate capacity in favor of tablet over smartphone, as the Company mentioned before. Consequently, Himax anticipates its smartphone sales to be down single digit in Q3. Looking ahead at its smartphone TDDI lineups, the Company is undertaking new design developments supporting higher frame rate, ultra slim bezel and higher resolution features. It expects successful engagements with key customers in the coming quarters. Discrete drivers for smartphone, running at relatively low volume, are expected to grow strongly with seasonal demand for the third quarter.

Himax expects strong growth for its automotive IC business in Q3 on the backdrop of severe global IC shortage for the automotive market. With the rising volume for EV and anticipated proliferation of autonomous driving, the display for automotive market will grow in not only volume but also chip size and sophistication. As a world-leading automotive driver supplier who commands well over 30% of the global market, the Company is leading the charge in answering to such demands. Himax continues to work closely with panel suppliers, Tier-1 players, and car makers for their future generation display designs.

The most prominent among the new technologies for automotive display is TDDI which is especially critical for large size and free form displays. Himax is the pioneer in the world of automotive TDDI development, having started the first generation TDDI mass production as early as the second quarter of 2019. Taking advantage of the first mover position and its long-standing close engineering collaboration with Tier-1 customers, the Company further upgraded its design and now Companys Gen 2 TDDI for automotive has officially entered into mass production in this quarter with dominating design-win coverage across literally all display makers, numerous Tier-1 players and leading car manufactures across all automotive markets. The number of awarded projects is already in the dozens and still growing quickly as speaks. Himax expects the TDDI volume to expand exponentially starting from this quarter.

Aside from providing comprehensive coverage to address varying design needs, most important of all, its product portfolio adheres to the demanding standards of quality and reliability required of automotive products. Himaxs early engagement with customers and mass production experience will prove invaluable for its long-term competitiveness.

Also during the third quarter, the Company is again pioneering in the launch of the leading-edge LTDI (Large-display Touch and Driver Integration) solution that incorporates sophisticated multi-chip system design and is essential for very large-sized, stylish, curved automotive displays in a customers upcoming first launch in vehicles. With these new technologies unleashed, Himax expects its automotive driver business to enjoy phenomenal growth for the next few years.

As AMOLED technology is embraced in the high-end display market, Himax is highly devoted to this area, covering smartphone, wearable, tablet and automotive areas. Its successful collaboration with BOE Varitronix, a subsidiary of BOE, the worlds largest TFT LCD player, on flexible AMOLED driver and Tcon for automotive application is expected to be in mass production commencing in the fourth quarter this year. The Company is also excited about the significant progress in other fields with major China panel partners and will update the status when appropriate.

Capacity shortage is expected to continue across all business segments in its small and medium-sized driver IC business. The Companys shipping quantity will be constrained by capacity shortage during the third quarter.

Non-Driver Product Categories

TCON

For Q3, the Company anticipates mid-teens sequential growth in Tcon sales. While also still limited by accessible capacity,the Company is optimistic about long term growth prospect of the Tcon business with strong demand coming from some of the high value products areas such as 4K/8K TV, gaming monitor, and low power notebook. Looking further ahead, the Company is also particularly excited about the potential for automotive Tcon which incorporates its leading-edge local dimming feature that, coupled with mini-LED backlight, enables thousands of dimming zones for superior display contrast comparable to that of AMOLED. Companys industry-leading local dimming Tcon already won numerous project awards from OEMs and Tier-1s. Himax believes Tcon segment will continue to be one of the growth drivers for its non-driver business.

WLO

In the third quarter, the Company will continue to support an anchor customers legacy product and anticipate sales to remain flat sequentially, which will help sustain WLO factory utilization. WLO technologies continue to play an important role in enabling future generation optical applications. As a leader in the diffractive optics field, the Company keeps on collaborating with worldwide tech giants and OEMs where it is fully involved in optical-related innovation and development of ToF 3D sensing, AR glasses, and other applications in a wide range of different fields

3D Sensing

Himaxs proprietary 3D decoder IC has been broadly acknowledged in the leading e-payment ecosystems in China since its initial mass production in the second half of 2020. Its 3D decoder IC provides high-performance decoding capability for high-precision face recognition and is particularly popular in areas such as door lock and industrial access control where privacy is a major concern. The Company expects more design-win awards and growing volume throughout the year.

Ultralow power smart sensing

To maximize market visibility and explore potential applications, the Company continues to push forward with two WiseEye business models, namely total solution and discrete component.

Himaxs WiseEye total solution implements ultralow power computer vision AI that aims at endpoint devices with constraints in processor resource and power consumption. In addition to the design-win for a mainstream application from a leading tech name that it reported last quarter,the Company ispleased to report new awards during the second quarter from utility meter, battery camera and panoramic video conferencing applications. Some of these applications are expected to enter into mass production beginning the fourth quarter of 2021. Himax continues to work on various new solutions covering a wide variety of applications including door bell, surveillance, smart city, healthcare, agriculture and many other AIoT devices, with joint efforts from multiple algorithm partners in different domains, including Himax subsidiary Emza. Himax is at the forefront of delivering cutting-edge ultralow power smart image sensing solutions to the edge AI markets.

For WiseEye key component business model, the Company reinforced its go-to-market strategy by intensively participating in leading AI partners infrastructures and ecosystems. Following the successful collaboration with Googles TensorFlow Lite for Microcontrollers and Microsoft Azure, it also joined Arm AI Partner Program and tinyML Foundation in an attempt to reach out to more diverse AI communities. More recently, the Company teamed up with online store Digi-Key, in addition to SparkFun that it announced before, to showcase its edge device components and easy-to-use development tools for developers to conveniently access Himaxs WiseEye solution. Hundreds of evaluation boards and developments kits have been purchased online and distributed to AI developers across the globe. With extended outreach to various AI channels, the Company has received priceless feedbacks from numerous users for different application domains that never occurred to it. Himax is excited about the business progress and is confident that WiseEye will play a key role in its non-driver segment looking ahead into 2022 and beyond.

For non-driver IC business, the Company expects revenue to increase low-single digit sequentially in the third quarter.

Third Quarter 2021 GuidanceThe Company is providing the following financial guidance for the third quarterof 2021:Net Revenue: To increase by 13% to 17% sequentiallyGross Margin: To be 50.5% to 52.0%, depending on final product mixNon-IFRS Profit: To be 75.0 cents to 81.0 cents per diluted ADSIFRS Profit: To be 63.0 cents to 69.0 cents per diluted ADS

For the third quarter, the Company expects further revenue growth from the already high level of Q2 2021. Gross margin shall see another uptick and could reach another quarterly high. With the increases of both revenue and margin, Himax anticipates net profit shall increase substantially in the third quarter.

Similar to Companys usual practice, Himax will grant RSUs on or around September 30 this year for employees share-based compensation. Q3 guidance for IFRS profit per diluted ADS has taken into account the expected 2021 RSU grant, which, subject to Board approval, is now assumed to be around $75 million, out of which $26.3 million, or 11.8 cents per diluted ADS, will be vested and expensed immediately on the grant date. As a reminder, the total RSU amount and the immediately vested portion are Companys current best estimates only and could vary materially depending on, among other things, its Q4 profit and the final Board decision for the total RSU amount and its vesting scheme. As is the case for previous years, the RSU grant in 2021 would lead to higher third quarter IFRS operating expenses compared to the other quarters of the year. In comparison, the 2020 RSUs totaled $5.0 million, out of which $4.8 million was vested immediately. Needless to say, Companys estimated total RSU amount is significantly higher than those of the prior years due to the anticipated record high profit for this year. This is an illustration of its appreciation to the team for their hard work. This also demonstrates Himaxs confidence in its long-term growth prospects.

HIMAX TECHNOLOGIES SECOND QUARTER 2021 EARNINGS CONFERENCE CALLDATE: Thursday, August 5^th, 2021TIME: U.S. 8:00 a.m. EDT Taiwan 8:00 p.m.DIAL IN: U.S. +1 (866) 444-9147 INTERNATIONAL +1 (678) 509-7569CONFERENCE ID: 7248119WEBCAST: https://edge.media-server.com/mmc/p/hbt43kh5

A replay of the call will be available beginning two hours after the call through 11:30 a.m. US EDT on August 13th , 2021 (11:30 p.m. Taiwan time, August 13th , 2021) on www.himax.com.twand by telephone at +1 (855) 859-2056 (US Domestic) or +1 (404) 537-3406 (International). The conference ID number is 7248119. This call is being webcast by Nasdaq and can be accessed by clicking on this link or Himaxs website, where the webcast can be accessed through August 5th, 2022.

About Himax Technologies, Inc.

Himax Technologies, Inc. (NASDAQ: HIMX) is a fabless semiconductor solution provider dedicated to display imaging processing technologies. Himax is a worldwide market leader in display driver ICs and timing controllers used in TVs, laptops, monitors, mobile phones, tablets, automotive, digital cameras, car navigation, virtual reality (VR) devices and many other consumer electronics devices. Additionally, Himax designs and provides controllers for touch sensor displays, in-cell Touch and Display Driver Integration (TDDI) single-chip solutions, LED driver ICs, power management ICs and LCoS micro-displays for augmented reality (AR) devices and heads-up displays (HUD) for automotive. The Company also offers CMOS image sensors, wafer level optics for AR devices, 3D sensing and ultralow power smart sensing, which are used in a wide variety of applications such as mobile phone, tablet, laptop, TV, PC camera, automobile, security, medical device, home appliance, AIoT, etc. Founded in 2001 and headquartered in Tainan, Taiwan, Himax currently employs around 2,000 people from three Taiwan-based offices in Tainan, Hsinchu and Taipei and country offices in China, Korea, Japan, Israel, and the US. Himax has 3,023 patents granted and 503 patents pending approval worldwide as of June 30, 2021. Himax has retained its position as the leading display imaging processing semiconductor solution provider to consumer electronics brands worldwide.

Forward Looking Statements

Factors that could cause actual events or results to differ materially from those described in this conference call include, but are not limited to, the effect of the Covid-19 pandemic on the Companys business; general business and economic conditions and the state of the semiconductor industry; market acceptance and competitiveness of the driver and non-driver products developed by the Company; demand for end-use applications products; reliance on a small group of principal customers; the uncertainty of continued success in technological innovations; our ability to develop and protect our intellectual property; pricing pressures including declines in average selling prices; changes in customer order patterns; changes in estimated full-year effective tax rate; shortage in supply of key components; changes in environmental laws and regulations; changes in export license regulated by Export Administration Regulations (EAR); exchange rate fluctuations; regulatory approvals for further investments in our subsidiaries; our ability to collect accounts receivable and manage inventory and other risks described from time to time in the Company's SEC filings, including those risks identified in the section entitled "Risk Factors" in its Form 20-F for the year ended December 31, 2020 filed with the SEC, as may be amended.

Company Contacts:

Eric Li, Chief IR/PR OfficerHimax Technologies, Inc.Tel: +886-6-505-0880 Fax: +886-2-2314-0877Email: hx_ir@himax.com.twwww.himax.com.tw

Karen Tiao, Investor RelationsHimax Technologies, Inc.Tel: +886-2-2370-3999Fax: +886-2-2314-0877Email: hx_ir@himax.com.twwww.himax.com.tw

Mark Schwalenberg, DirectorInvestor Relations - US RepresentativeMZ North AmericaTel: +1-312-261-6430Email: HIMX@mzgroup.uswww.mzgroup.us

-Financial Tables-

Himax Technologies, Inc.Unaudited Condensed Consolidated Statements of Profit or Loss(These interim financials do not fully comply with IFRS because they omit allinterim disclosure required by IFRS)(Amounts in Thousands of U.S. Dollars, Except Share and Per Share Data)

Three Three Months Months Ended June 30, Ended March 31, 2021 2020 2021 Revenues Revenues fromthird parties, $ 365,257 $ 186,984 $ 308,983 netRevenues fromrelated 4 - 20 parties, net 365,261 186,984 309,003 Costs and expenses:Cost of 191,665 147,726 184,722 revenuesResearch and 28,924 28,403 29,523 developmentGeneral and 6,398 5,662 5,772 administrativeSales and 4,248 3,548 4,186 marketingTotal costs 231,235 185,339 224,203 and expenses Operating 134,026 1,645 84,800 income Non operating income (loss):Interest 220 263 195 incomeChanges infair value offinancial (21 ) (83 ) (33 )assets at fairvalue throughprofit or lossForeigncurrency (559 ) 1 555 exchange gains(losses), netFinance costs (260 ) (551 ) (260 )Share ofprofits (184 ) 12 (274 )(losses) ofassociatesOther income 50 22 11 (754 ) (336 ) 194 Profit before 133,272 1,309 84,994 income taxesIncome tax 24,954 365 18,699 expenseProfit for the 108,318 944 66,295 periodLossattributableto 573 439 601 noncontrollinginterestsProfitattributableto Himax $ 108,891 $ 1,383 $ 66,896 Technologies,Inc.stockholders Basic earningsper ADSattributableto Himax $ 0.623 $ 0.008 $ 0.384 Technologies,Inc.stockholdersDilutedearnings perADSattributable $ 0.623 $ 0.008 $ 0.383 to HimaxTechnologies,Inc.stockholders Basic WeightedAverage 174,667 172,618 174,414 OutstandingADSDilutedWeightedAverage 174,729 173,158 174,680 OutstandingADS

Himax Technologies, Inc.Unaudited Condensed Consolidated Statements of Profit or Loss(Amounts in Thousands of U.S. Dollars, Except Share and Per Share Data)

Six Months Ended June 30, 2021 2020 Revenues Revenues fromthird parties, $ 674,240 $ 371,578 netRevenues fromrelated parties, 24 - net 674,264 371,578 Costs and expenses:Cost of revenues 376,387 290,398 Research and 58,447 56,092 developmentGeneral and 12,170 11,466 administrativeSales and 8,434 7,330 marketingTotal costs and 455,438 365,286 expenses Operating income 218,826 6,292 Non operating income (loss):Interest income 415 659 Changes in fairvalue offinancial assets (54 ) (148 )at fair valuethrough profitor lossForeign currencyexchange losses, (4 ) (54 )netFinance costs (520 ) (1,144 )Share of losses (458 ) (79 )of associatesOther income 61 57 (560 ) (709 )Profit before 218,266 5,583 income taxesIncome tax 43,653 1,829 expenseProfit for the 174,613 3,754 periodLossattributable to 1,174 923 noncontrollinginterestsProfitattributable toHimax $ 175,787 $ 4,677 Technologies,Inc.stockholders Basic earningsper ADSattributable toHimax $ 1.007 $ 0.027 Technologies,Inc.stockholdersDiluted earningsper ADSattributable toHimax $ 1.006 $ 0.027 Technologies,Inc.stockholders Basic WeightedAverage 174,542 172,599 Outstanding ADSDiluted WeightedAverage 174,802 173,224 Outstanding ADS

Himax Technologies, Inc.Unaudited Supplemental Financial Information(Amounts in Thousands of U.S. Dollars)

The amount ofshare-basedcompensationincluded in Three Monthsapplicable Three Months Ended statements of Ended June 30, March 31,profit or losscategories issummarized asfollows: 2021 2020 2021 Share-based compensationCost of revenues $ - $ 5 $ - Research and - 122 - developmentGeneral and - 15 - administrativeSales and marketing - 26 - Income tax benefit - (31 ) - Total $ - $ 137 $ - The amount ofacquisition-relatedcharges included inapplicablestatements of profit or losscategories issummarized asfollows: Acquisition-related chargesResearch and $ 276 $ 277 $ 277 developmentIncome tax benefit (64 ) (65 ) (65 )Total $ 212 $ 212 $ 212

Himax Technologies, Inc.Unaudited Supplemental Financial Information(Amounts in Thousands of U.S. Dollars)

The amount ofshare-basedcompensation included Six Monthsin applicable Ended June 30, statements of profit orloss categories issummarized as follows: 2021 2020 Share-based compensationCost of revenues $ - $ 15 Research and - 391 developmentGeneral and - 40 administrativeSales and marketing - 66 Income tax benefit - (95 )Total $ - $ 417 The amount ofacquisition-relatedcharges included inapplicable statements of profit or losscategories issummarized as follows:

Acquisition-related chargesResearch and $ 553 $ 553 developmentIncome tax benefit ) ) (129 (129Total $ 424 $ 424

Himax Technologies, Inc.IFRS Unaudited Condensed Consolidated Statements of Financial Position(Amounts in Thousands of U.S. Dollars) June 30, June 30, March 31, 2021 2020 2021Assets Current assets: Cash and cash $ 251,725 $ 96,130 $ 227,378 equivalentsFinancial assets at 13,542 10,929 11,881 amortized costFinancial assets atfair value through 5,144 - 6,561 profit or lossAccounts receivable, 329,019 206,075 289,067 netAccounts receivable 4 - 29 from related partiesInventories 134,243 161,474 114,945 Income taxes 91 75 44 receivableRestricted deposit 112,100 164,000 114,800 Other receivable from 1,209 1,200 1,215 related partiesOther current assets 28,962 24,246 35,274 Total current assets 876,039 664,129 801,194 Financial assets atfair value through 13,902 13,352 13,930 profit or lossFinancial assets atfair value through 557 737 541 othercomprehensiveincomeEquity method 4,205 3,660 3,944 investmentsProperty, plant and 137,031 137,530 136,250 equipment, netDeferred tax assets 8,043 14,537 15,708 Goodwill 28,138 28,138 28,138 Other intangible 7,147 7,953 7,428 assets, netRestricted deposit 35 135 35 Refundable deposits 79,154 1,182 13,308 Other non-current 437 851 857 assets 278,649 208,075 220,139 Total assets $ 1,154,688 $ 872,204 $ 1,021,333 Liabilities and EquityCurrent liabilities: Short-term unsecured $ - $ 58,437 $ - borrowingsCurrent portion oflong-term unsecured 6,000 - 6,000 borrowingsShort-term secured 104,000 164,000 104,000 borrowingsAccounts payable 208,302 161,474 191,304 Accounts payable to 2,186 - 1,189 related partiesIncome taxes payable 39,587 3,960 32,033 Other payable to 2,804 2,740 2,497 related partiesContract liabilities 6,567 1,338 6,694 Other current 88,506 33,411 43,331 liabilitiesTotal current 457,952 425,360 387,048 liabilitiesLong-term unsecured 49,500 - 51,000 borrowingsNet defined benefit 48 50 47 liabilitiesDeferred tax 1,011 1,284 1,073 liabilitiesOther non-current 32,513 9,989 30,012 liabilities 83,072 11,323 82,132 Total liabilities 541,024 436,683 469,180 Equity Ordinary shares 107,010 107,010 107,010 Additional paid-in 108,180 105,686 107,743 capitalTreasury shares (5,788 ) (8,656 ) (5,820 )Accumulated other (545 ) (1,110 ) (694 )comprehensive incomeRetained earnings 400,980 230,564 339,493 Equity attributableto owners of Himax 609,837 433,494 547,732 Technologies, Inc.Noncontrolling 3,827 2,027 4,421 interestsTotal equity 613,664 435,521 552,153 Total liabilities and $ 1,154,688 $ 872,204 $ 1,021,333 equity

Himax Technologies, Inc.Unaudited Condensed Consolidated Statements of Cash Flows(Amounts in Thousands of U.S. Dollars) Three Months Three Months Ended Ended June 30, March 31, 2021 2020 2021 Cash flowsfrom operatingactivities:Profit for $ 108,318 $ 944 $ 66,295 the periodAdjustments for:Depreciationand 5,449 5,881 5,272 amortizationShare-basedcompensation - 168 - expensesGain ondisposal ofproperty, - (242 ) - plant andequipment,netChanges infair valueof financialassets at 21 83 33 fair valuethroughprofit orlossInterest (220 ) (263 ) (195 )incomeFinance 260 551 260 costsIncome tax 24,954 365 18,699 expenseShare oflosses 184 (12 ) 274 (profits) ofassociatesInventories 1,646 3,413 2,475 write downsUnrealizedforeigncurrency 544 (59 ) (725 )exchangelosses(gains) 141,156 10,829 92,388 Changes in: Accounts (39,952 ) (19,340 ) (45,441 )receivableAccountsreceivable 25 - (29 )to relatedpartiesInventories (20,944 ) (16,456 ) (8,713 )Otherreceivable 6 - (15 )from relatedpartiesOthercurrent (2,219 ) (602 ) (2,876 )assetsAccounts 16,898 15,875 19,501 payableAccountspayable to 997 - (379 )relatedpartiesOtherpayable to 307 300 (75 )relatedpartiesNet definedbenefit 1 1 - liabilitiesContract (127 ) 51 72 liabilitiesOthercurrent 633 1,314 (319 )liabilitiesOthernon-current (1,188 ) - 6,680 liabilitiesCashgeneratedfrom 95,593 (8,028 ) 60,794 operatingactivitiesInterest 317 548 90 receivedInterest (260 ) (555 ) (270 )paidIncome tax (10,453 ) (1,123 ) (294 )paidNet cashprovided by(used in) 85,197 (9,158 ) 60,320 operatingactivities Cash flowsfrom investingactivities:Acquisitionsof property, (1,398 ) (708 ) (2,016 )plant andequipmentProceedsfromdisposal of - 247 - property,plant andequipmentAcquisitionsof (144 ) (6 ) - intangibleassetsAcquisitionsof financialassets at (2,658 ) (1,425 ) (3,979 )amortizedcostProceedsfromdisposal offinancial 1,025 1,446 677 assets atamortizedcostAcquisitionsof financialassets atfair value (13,007 ) (2,483 ) (3,546 )throughprofit orlossProceedsfromdisposal offinancialassets at 14,797 2,502 4,747 fair valuethroughprofit orlossProceedsfrom capital - - 151 reduction ofinvestmentAcquisitionsof equity - - (598 )methodinvestmentsDecrease(increase)in (59,563 ) 177 (1,197 )refundabledepositsReleases(pledges) of 2,700 (3 ) (10,694 )restricteddepositNet cashused in (58,248 ) (253 ) (16,455 )investingactivities Cash flowsfrom financingactivities:Payments ofcash (20 ) - - dividendsProceedsfromshort-term - 58,403 10,000 unsecuredborrowingsRepaymentsofshort-term - (67,818 ) (10,000 )unsecuredborrowingsRepaymentsof long-term (1,500 ) - (1,500 )unsecuredborrowingsProceedsfromshort-term 60,000 87,000 97,000 securedborrowingsRepaymentsofshort-term (60,000 ) (87,000 ) (97,000 )securedborrowingsPayment oflease (1,236 ) (669 ) (970 )liabilitiesProceedsfromexercise of 35 173 1,117 employeestockoptionsNet cashused in (2,721 ) (9,911 ) (1,353 )financingactivitiesEffect offoreigncurrencyexchange 119 (225 ) (72 )rate changeson cash andcashequivalentsNet increase(decrease)in cash and 24,347 (19,547 ) 42,440 cashequivalentsCash andcashequivalents 227,378 115,677 184,938 at beginningof periodCash andcashequivalents $ 251,725 $ 96,130 $ 227,378 at end ofperiod



Himax Technologies, Inc.Unaudited Condensed Consolidated Statements of Cash Flows(Amounts in Thousands of U.S. Dollars) Six Months Ended June 30, 2021 2020 Cash flows fromoperating activities:Profit for the $ 174,613 $ 3,754 periodAdjustments for: Depreciation and 10,721 11,635 amortizationShare-basedcompensation - 512 expensesGain on disposalof property, - (242 )plant andequipment, netChanges in fairvalue offinancial assets 54 148 at fair valuethrough profitor lossInterest income (415 ) (659 )Finance costs 520 1,144 Income tax 43,653 1,829 expenseShare of losses 458 79 of associatesInventories 4,121 7,490 write downsUnrealizedforeign currency (181 ) (50 )exchange gains 233,544 25,640 Changes in: Accounts (85,393 ) (41,132 )receivableAccountsreceivable to (4 ) - related partiesInventories (29,657 ) (25,190 )Other receivablefrom related (9 ) - partiesOther current (5,095 ) 106 assetsAccounts payable 36,399 47,154 Accounts payableto related 618 - partiesOther payable to 232 520 related partiesNet definedbenefit 1 - liabilitiesContract (55 ) (564 )liabilitiesOther current 314 (2,912 )liabilitiesOthernon-current 5,492 (74 )liabilitiesCash generatedfrom operating 156,387 3,548 activitiesInterest 407 729 receivedInterest paid (530 ) (1,185 )Income tax paid (10,747 ) (1,663 )Net cashprovided by 145,517 1,429 operatingactivities Cash flows frominvesting activities:Acquisitions ofproperty, plant (3,414 ) (3,800 )and equipmentProceeds fromdisposal of - 247 property, plantand equipmentAcquisitions ofintangible (144 ) (78 )assetsAcquisitions offinancial assets (6,637 ) (2,162 )at amortizedcostProceeds fromdisposal offinancial assets 1,702 2,211 at amortizedcostAcquisitions offinancial assetsat fair value (16,553 ) (3,588 )through profitor lossProceeds fromdisposal offinancial assets 19,544 3,599 at fair valuethrough profitor lossProceeds fromcapital 151 - reduction ofinvestmentAcquisitions ofequity method (598 ) - investmentsIncrease inrefundable (60,760 ) (2,837 )depositsPledges ofrestricted (7,994 ) (2 )depositNet cash used ininvesting (74,703 ) (6,410 )activities

Himax Technologies, Inc.Unaudited Condensed Consolidated Statements of Cash Flows(Amounts in Thousands of U.S. Dollars)

Cash flows fromfinancing activities:Payments of cash (20 ) - dividendsProceeds fromshort-term 10,000 198,137 unsecuredborrowingsRepayments ofshort-term (10,000 ) )unsecured (196,952borrowingsRepayments oflong-term (3,000 ) - unsecuredborrowingsProceeds fromshort-term 157,000 124,000 securedborrowingsRepayments ofshort-term ) )secured (157,000 (124,000borrowingsPayment of lease (2,206 ) (1,131 )liabilitiesProceeds fromexercise of 1,152 173 employee stockoptionsNet cashprovided by(used in) (4,074 ) 227 financingactivitiesEffect offoreign currencyexchange rate 47 (171 )changes on cashand cashequivalentsNet increase(decrease) in 66,787 (4,925 )cash and cashequivalentsCash and cashequivalents at 184,938 101,055 beginning ofperiodCash and cashequivalents at $ 251,725 $ 96,130 end of period

Himax Technologies, Inc.Non-IFRS Unaudited Supplemental Data ? Reconciliation Schedule(Amounts in Thousands of U.S. Dollars)

Gross Margin, Operating Margin and Net Margin Excluding Share-BasedCompensation and Acquisition-Related Charges: Three Months Three Months Ended June 30, Ended March 31, 2021 2020 2021 Revenues $ 365,261 $ 186,984 $ 309,003 Gross profit 173,596 39,258 124,281 Add: Share-basedcompensation ? cost - 5 - of revenuesGross profitexcluding 173,596 39,263 124,281 share-basedcompensationGross marginexcluding 47.5 % 21.0 % 40.2 %share-basedcompensationOperating income 134,026 1,645 84,800 Add: Share-based - 168 - compensationOperating incomeexcluding 134,026 1,813 84,800 share-basedcompensationAdd:Acquisition-related 276 277 277 charges ?intangibleassets amortizationOperating incomeexcludingshare-based 134,302 2,090 85,077 compensation andacquisition-relatedchargesOperating marginexcludingshare-based 36.8 % 1.1 % 27.5 %compensation andacquisition-relatedchargesProfit attributableto Himax 108,891 1,383 66,896 Technologies, Inc.stockholdersAdd: Share-basedcompensation, net - 137 - of taxAdd:Acquisition-related 212 212 212 charges, net of taxProfit attributableto HimaxTechnologies, Inc.stockholdersexcluding 109,103 1,732 67,108 share-basedcompensation andacquisition-relatedchargesNet marginattributable toHimax Technologies,Inc. stockholdersexcluding 29.9 % 0.9 % 21.7 %share-basedcompensation andacquisition-relatedcharges *Gross margin excluding share-based compensation equals gross profit excludingshare-based compensation divided by revenues*Operating margin excluding share-based compensation and acquisition-relatedcharges equals operating income excluding share-based compensation andacquisition-related charges divided by revenues*Net margin attributable to Himax Technologies, Inc. stockholders excludingshare-based compensation and acquisition-related charges equals profitattributable to Himax Technologies, Inc. stockholders excluding share-basedcompensation and acquisition-related charges divided by revenues

Himax Technologies, Inc.Non-IFRS Unaudited Supplemental Data ? Reconciliation Schedule(Amounts in Thousands of U.S. Dollars)

Gross Margin, Operating Margin and Net Margin Excluding Share-BasedCompensation and Acquisition-Related Charges: Six Months Ended June 30, 2021 2020 Revenues $ 674,264 $ 371,578 Gross profit 297,877 81,180 Add: Share-basedcompensation ? cost of - 15 revenuesGross profit excludingshare-based 297,877 81,195 compensationGross margin excludingshare-based 44.2 % 21.9 %compensationOperating income 218,826 6,292 Add: Share-based - 512 compensationOperating incomeexcluding share-based 218,826 6,804 compensationAdd:Acquisition-related 553 553 charges ?intangibleassets amortizationOperating incomeexcluding share-basedcompensation and 219,379 7,357 acquisition-relatedchargesOperating marginexcluding share-basedcompensation and 32.5 % 2.0 %acquisition-relatedchargesProfit attributable toHimax Technologies, 175,787 4,677 Inc. stockholdersAdd: Share-basedcompensation, net of - 417 taxAdd:Acquisition-related 424 424 charges, net of taxProfit attributable toHimax Technologies,Inc. stockholdersexcluding share-based 176,211 5,518 compensation andacquisition-relatedchargesNet marginattributable to HimaxTechnologies, Inc.stockholders excluding 26.1 % 1.5 %share-basedcompensation andacquisition-relatedcharges *Gross margin excluding share-based compensation equals gross profit excludingshare-based compensation divided by revenues*Operating margin excluding share-based compensation and acquisition-relatedcharges equals operating income excluding share-based compensation andacquisition-related charges divided by revenues*Net margin attributable to Himax Technologies, Inc. stockholders excludingshare-based compensation and acquisition-related charges equals profitattributable to Himax Technologies, Inc. stockholders excluding share-basedcompensation and acquisition-related charges divided by revenues

Diluted Earnings Per ADS Attributable to Himax Technologies, Inc. StockholdersExcluding Share-based Compensation and Acquisition-Related Charges: (Amounts inU.S. Dollars)

Three Six Months Months Ended Ended June June 30, 30, 2021 2021 Diluted IFRS earnings per ADS attributable to $ 0.623 $ 1.006 Himax Technologies, Inc. stockholders

- - Add: Share-based compensation per ADSAdd: Acquisition-related charges per ADS $ 0.001 $ 0.002 Diluted non-IFRS earnings per ADS attributable toHimax Technologies, Inc. stockholders excluding $ 0.624 $ 1.008 share-based compensation and acquisition-relatedcharges

Numbers do not add up due to rounding