Pado, Stock Price Falls Below 20,000 Won Amid Earnings Shock and Lock-Up Sale Setbacks

Q3 Revenue of 320 Million KRW... 97.6% Decrease Compared to Last Year
Operating Loss Expanded 8 Times to 34.4 Billion KRW Compared to Last Year

The stock price of Pado, a major player in the IPO market in the second half of this year, fell below 20,000 won due to a performance shock and the lifting of lock-up restrictions.

According to the Korea Exchange on the 10th, Pado closed at 18,970 won, down 21.93% (5,330 won) from the previous trading day. After hitting the lower limit price and closing at 24,300 won following the Q3 earnings announcement the previous day, Pado continued its sharp decline today. As a result, the stock price fell below 20,000 won.

Pado's Q3 sales amounted to 320 million won, a 97.6% plunge compared to 13.592 billion won in the same period last year. Operating loss widened to 34.4 billion won from a loss of 4.2 billion won last year. On a cumulative basis through Q3, sales were 18.044 billion won, down 44.6% from 32.56 billion won last year. The cumulative loss through Q3 reached 34.41 billion won.

The market reacted sensitively to Pado's earnings shock because it showed a significant gap from the expected sales for this year stated in the IPO prospectus. According to the prospectus submitted by Pado, the expected sales for this year were 120.294 billion won. This figure also shows a large discrepancy compared to the cumulative Q3 results.

There are also opinions that the sharp decline in sales was anticipated. Pado's main business is the SSD controller, one of the system semiconductor products. Pado has been supplying SSD controllers to Meta together with SK Hynix. As of Q1 this year, 64.16% of Pado's total sales came from SK Hynix. However, since SK Hynix is developing SSD controllers in-house, the need for Pado to diversify its sales has been consistently raised.

Pado stated, "In 2024, we will make efforts throughout the year to discover multiple NAND customers," adding, "We plan to promote various projects targeting multi-hyperscaler customers operating large-scale data centers in collaboration with NAND customers."