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CORRESP
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corresp

September 19, 2005

Securities and Exchange Commission

100 F Street N.E.

Washington, D.C. 20549-7561

Attention: Michele Gohlke, Branch Chief

    Re:

    Silicon Image, Inc.

    Form 10-K for the year ended December 31, 2004

    Form 8-K dated April 21, 2005

    Form 8-K dated January 25, 2005

Dear Ms. Gohlke:

     Reference is made to the letter, dated May 24, 2005, of the staff (the “Staff”) of the
Securities and Exchange Commission (the “Commission”) addressed to Silicon Image, Inc. (the
“Company”), regarding the above-referenced filings, our letter dated July 28, 2005 to the
Staff responding to that letter, and the telephone conversation between the Staff, Dale Brown and
Patrick Reutens of the Company and the undersigned on August 22, 2005.

     Our letter dated July 28, 2005 had included a proposed template of the Company’s proposed
disclosure to be used as a basis for its press release announcing the Company’s quarterly financial
results. Based on our discussion on August 22, we have revised this template to, among other
things, remove the table setting forth non-GAAP supplemental financial information. We have
supplementally attached, for the Staff’s review, a copy of the revised template to be used as a
basis for the Company’s press release announcing its financial results for the quarter ended
September 30, 2005, which will be furnished to the Commission as an exhibit to a Form 8-K.

     Should the Staff have additional questions or comments regarding the foregoing, please do not
hesitate to contact the undersigned at (415) 875-2455.

    Very truly yours,

/s/ David K. Michaels

David K. Michaels

Enclosure

    cc:

    Robert Freeman, Silicon Image, Inc.

    Patrick Reutens, Esq., Silicon Image, Inc.

    CONTACTS: [ CHIEF FINANCIAL OFFICER]

SILICON IMAGE, INC.

    [INVESTOR RELATIONS]

SILICON IMAGE, INC.

SILICON IMAGE REPORTS [THIRD QUARTER 2005] FINANCIAL RESULTS

[Language describing quarterly financial results]

* Note Regarding Non-GAAP Financial Information

The non-GAAP financial information set forth in this press release is presented for informational
purposes only, for the purpose of providing additional information that we believe can be useful in
evaluating our operations and operating results. This information is not in accordance with, or an
alternative for, generally accepted accounting principles and should not be considered in isolation
from our GAAP results of operations. Our presentation of non-GAAP financial information excludes
stock compensation expense and amortization of intangible assets. It also excludes gain (loss) on
investment security, which is not directly attributable to our ongoing operations and is expected
to be non-recurring. We believe that the exclusion of these items may help investors evaluate our
underlying operating performance and compare our results across reporting periods. Items such as
these can adversely affect our ability to provide a meaningful comparison of financial results
across reporting periods. For these reasons, management does not evaluate these items when
assessing the performance of our ongoing operations or when allocating resources. However, these
items can have a material impact on our net income and net income per share calculated in
accordance with GAAP. Additional information regarding our non-GAAP information, including a
reconciliation to comparable GAAP information, is set forth below in the table below under the
caption “Reconciliation Of GAAP To Non-GAAP Net Income” and related footnotes.

About Silicon Image

[Information about Silicon Image, Inc.]

Safe Harbor Statement

[Appropriate Safe Harbor Language]

SILICON IMAGE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (GAAP BASIS)

    Three Months Ended

    Nine Months Ended

    (unaudited)

    (unaudited)

    Sept. 30,

    June 30,

    Sept. 30,

    Sept. 30,

    Sept. 30,

    (In thousands, except per share amounts)

    2005

    2005

    2004

    2005

    2004

    Revenue:

    Product

    Development, licensing and royalties

    Total revenue

    Cost of revenue and operating expenses:

    Cost of revenue (1)

    Research and development (2)

    Selling, general and administrative (3)

    Amortization of intangible assets

    Total cost of revenue and operating expenses

    Loss from operations

    Interest income and other, net

    Gain (loss) on investment security

    Loss before provision for income taxes

    Provision for income taxes

    Net income (loss)

    Net loss per share — basic

    Net loss per share — diluted

    Weighted average shares — basic

    Weighted average shares — diluted

    (1)

    Includes stock compensation expense (benefit) of ___, ___, ___, ___and ___for the three months ended
September 30, 2005, June 30, 2005 and September 30, 2004 and the nine months ended September 30, 2005 and September
30, 2004, respectively.

    (2)

    Includes stock compensation expense (benefit) of ___, ___, ___, ___and ___for the three months ended
September 30, 2005, June 30, 2005 and September 30, 2004 and the nine months ended September 30, 2005 and September
30, 2004, respectively.

    (3)

    Includes stock compensation expense (benefit) of ___, ___, ___, ___and ___for the three months ended
September 30, 2005, June 30, 2005 and September 30, 2004 and the nine months ended September 30, 2005 and September
30, 2004, respectively.

SILICON IMAGE, INC.

RECONCILIATION OF GAAP TO NON-GAAP NET INCOME

    Three Months Ended

    Nine Months Ended

    (unaudited)

    (unaudited)

    Sept. 30,

    June 30,

    Sept. 30,

    Sept. 30,

    Sept. 30,

    (In thousands)

    2005

    2005

    2004

    2005

    2004

    GAAP net income (loss):

    Adjustments:

    Stock compensation expense (benefit) (1)

    Amortization of intangible assets (2)

    Gain (loss) on investment security (3)

    Non-GAAP net income (loss)

    Non-GAAP net income (loss) per share — diluted

    Weighted average shares — diluted

    (1)

    This adjustment represents expenses (benefit) associated with stock option modifications,
including repricings, and certain stock options issued to employees of acquired companies and to
non-employees in exchange for services. Stock-based compensation expense (benefit) fluctuates based
in large part on changes in our stock price. Management excludes this expense (benefit) when
reviewing our cost of revenue and operating expenses because these changes in our stock price are
out of our control and may be unrelated to our ongoing business operations, and because it does not
consider this expense (benefit) to be relevant to an assessment of our on-going operations.

    (2)

    This adjustment represents expenses for the amortization of intangible assets recorded in
connection with our acquisitions. These ongoing expenses pertain to intangible assets that are not
expected to be replaced when fully amortized, as might a depreciable tangible asset.

    (3)

    This gain (loss) relates to warrants and stock received by the company from a
transaction involving the licensing of certain of our intellectual property. These gains or losses
are non-recurring, and reflect market and other conditions that are unrelated to our ongoing
business operations.

SILICON IMAGE, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

    September 30,

    December 31,

    2005

    2004

    (In thousands)

    (unaudited)

    Assets

    Current assets:

    Cash and short-term investments

    Accounts receivable, net

    Inventories

    Prepaid expenses and other current assets

    Total current assets

    Property and equipment, net

    Goodwill and intangible assets, net

    Other assets

    Total assets

    Liabilities and Stockholders’ Equity

    Current liabilities:

    Accounts payable

    Debt and other current liabilities

    Deferred margin on sales to distributors

    Total current liabilities

    Stockholders’ equity

    Total liabilities and stockholders’ equity