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What happens when an obscure small-cap company announces behemoth Apple Inc. (Nasdaq: AAPL) is a major customer? Shares skyrocket.
That's exactly what happened Thursday when Pixelworks Inc. (Nasdaq: PXLW) disclosed Apple is a chief purchaser.
Reports of the Pixelworks/Apple association came late Wednesday when Pixelworks released its 10K (annual report) to the U.S. Securities and Exchange Commission. In the mandatory report, which gives a comprehensive summary of a company's financial performance, Pixelworks divulged that Apple accounted for more than 10% of its 2013 revenue.
The news sent PXLW shares soaring 85% intraday to $8.87. Volume during the first half hour of trading was brisk at 1.62 million shares. That compares to PXLW's average daily volume of 461,000. By noon, more than 12.5 million shares changed hands.
One year ago, PXLW shares fetched a mere $2.45 and volume was a scant 2,100 shares daily.
Having Apple Inc. as a major customer is a win for any company - but Pixelworks' name dropping didn't stop there.
The San Jose, Calif.-based company also shared that Tokyo-listed giant NEC Corporation is another key client. A Japanese multinational provider of information technology, the company was formerly known as the Nippon Electric Company Limited before rebranding in 1983 as just NEC.
Until now, Pixelworks kept its affiliations quiet. In Apple's case, it's because the iPhone maker strongly encourages its suppliers not to discuss any dealings unless required by law. Most do, as they don't want to lose $474.61 billion market cap Apple as a customer.
So it was only because it had to that Pixelworks made the disclosure. The SEC requires companies to publicly list customers who kick in more than 10% of revenue.
About Pixelworks (Nasdaq: PXLW)
Founded in 1997, Pixelworks is an innovative provider of video display processing technology that enables the highest-quality video viewing experience for displays of all sizes.