[Financial Highlights](index=1&type=section&id=Financial_Highlights) Vicor reported increased Q1 2025 revenues and returned to profitability, despite declining gross margins, while significantly growing operating cash flow and order backlog Q1 2025 Key Financial Metrics | Metric | Q1 2025 | Q1 2024 | Q4 2024 | YoY Change | QoQ Change | | :--- | :--- | :--- | :--- | :--- | :--- | | Revenues | $94.0M | $83.9M | $96.2M | +12.0% | -2.3% | | Gross Margin | $44.4M | $45.1M | $50.4M | -1.5% | -11.9% | | Gross Margin % | 47.2% | 53.8% | 52.4% | -6.6pp | -5.2pp | | Net Income (Loss) | $2.5M | ($14.5M) | $10.2M | N/A | -75.5% | | Diluted EPS | $0.06 | ($0.33) | $0.23 | N/A | -73.9% | Cash Flow and Capital Expenditures (Q1 2025) | Metric | Q1 2025 | Q1 2024 | Q4 2024 | | :--- | :--- | :--- | :--- | | Cash Flow from Operations | $20.1M | $2.6M | $10.1M | | Capital Expenditures | $4.6M | $7.3M | $1.7M | - Order backlog increased to **$171.7 million**, up **14.2%** year-over-year from **$150.3 million** and up **10.4%** sequentially from **$155.5 million**[6](index=6&type=chunk) - Cash and cash equivalents grew **6.8%** sequentially to **$296.1 million** as of March 31, 2025, from **$277.3 million** at the end of 2024[5](index=5&type=chunk) [Management Commentary](index=1&type=section&id=Management_Commentary) Management attributed revenue and margin declines to licensee transitions, with future improvements tied to fab utilization and new licensing, while advancing 2nd generation VPD for AI - Sequential declines in revenue and gross margins were attributed to reduced income from a licensee transitioning to a new generation of unlicensed products[7](index=7&type=chunk) - Future margin improvements depend on higher utilization of the company's ChiP fab and increased income from both existing and future licensing deals[7](index=7&type=chunk) - The company is advancing its 2nd generation VPD for AI, which will feature a new ASIC to increase density and bandwidth, aiming to set new performance standards for AI processors[7](index=7&type=chunk) [Financial Statements](index=3&type=section&id=Financial_Statements) Detailed financial statements reveal a return to net income, primarily due to the absence of prior-year litigation expenses, and an improved balance sheet with stronger cash and increased total assets [Condensed Consolidated Statement of Operations](index=3&type=section&id=Condensed_Consolidated_Statement_of_Operations) Q1 2025 net revenues reached $94.0 million with a net income of $2.5 million, a significant improvement over Q1 2024, largely due to the absence of a $17.2 million litigation expense Statement of Operations Summary (in thousands) | Account | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net revenues | $93,968 | $83,872 | | Gross margin | $44,365 | $45,123 | | Total operating expenses | $44,514 | $61,238 | | *Litigation-contingency expense* | *$ -* | *$17,200* | | Income (loss) from operations | ($149) | ($16,115) | | Net income (loss) attributable to Vicor | $2,539 | ($14,473) | | Diluted EPS | $0.06 | ($0.33) | [Condensed Consolidated Balance Sheet](index=4&type=section&id=Condensed_Consolidated_Balance_Sheet) As of March 31, 2025, Vicor's total assets increased to $665.0 million, driven by higher cash, with total liabilities rising to $84.5 million and total equity growing to $580.6 million Balance Sheet Summary (in thousands) | Account | Mar 31, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $296,099 | $277,273 | | Inventories | $98,515 | $106,032 | | **Total Assets** | **$665,038** | **$641,118** | | Total current liabilities | $75,661 | $61,820 | | **Total Liabilities** | **$84,475** | **$70,827** | | **Total Equity** | **$580,563** | **$570,291** | [Additional Information](index=2&type=section&id=Additional_Information) This section includes investor call details, a forward-looking statement disclaimer, and an overview of Vicor's modular power components business - An investor conference call was scheduled for 5:00 p.m. Eastern Time on April 29, 2025, with webcast details available on the company's website[8](index=8&type=chunk) - The release contains forward-looking statements and directs readers to the company's SEC filings (Form 10-K) for a full understanding of associated risks[9](index=9&type=chunk) - Vicor designs, manufactures, and markets modular power components and systems for various high-performance markets, including computing, industrial, and aerospace[10](index=10&type=chunk)

Core Viewpoint - Vicor Corporation reported a mixed financial performance for the first quarter of 2025, with revenue growth year-over-year but declines in gross margin and net income compared to the previous quarter [2][3][4]. Financial Performance - Revenues for Q1 2025 were $94.0 million, reflecting a 12.0% increase from $83.9 million in Q1 2024, but a 2.3% decrease from $96.2 million in Q4 2024 [2]. - Gross margin decreased to $44.4 million in Q1 2025 from $45.1 million in Q1 2024 and from $50.4 million in Q4 2024, with gross margin percentage dropping to 47.2% from 53.8% year-over-year and from 52.4% sequentially [3]. - Operating expenses were $44.5 million in Q1 2025, down from $61.2 million in Q1 2024 but up from $41.2 million in Q4 2024 [3]. Profitability - The net income for Q1 2025 was $2.5 million, or $0.06 per diluted share, compared to a net loss of $14.5 million or ($0.33) per diluted share in Q1 2024, and net income of $10.2 million or $0.23 per diluted share in Q4 2024 [4]. - Cash flow from operations was $20.1 million in Q1 2025, significantly up from $2.6 million in Q1 2024 and $10.1 million in Q4 2024 [5]. Backlog and Future Outlook - The backlog for Q1 2025 was $171.7 million, a 14.2% increase from $150.3 million in Q1 2024 and a 10.4% increase from $155.5 million at the end of Q4 2024 [6]. - CEO Dr. Patrizio Vinciarelli highlighted challenges in revenue and gross margin due to a licensee transitioning to new products, but noted potential for margin improvements with higher utilization of manufacturing capabilities and increased licensing income [7]. Capital Structure - As of March 31, 2025, cash and cash equivalents increased by 6.8% sequentially to approximately $296.1 million from approximately $277.3 million as of December 31, 2024 [5]. - Total assets as of March 31, 2025, were $665.0 million, up from $641.1 million at the end of 2024 [14][15].

Core Viewpoint - Vicor Corporation will hold its first quarter 2025 earnings conference call on April 29, 2025, at 5:00 p.m. Eastern Time, to discuss financial and operational results for the three months ended March 31, 2025 [1]. Group 1: Earnings Call Details - The earnings results will be released via GlobeNewswire at the close of the NASDAQ Market Session on April 29, 2025, with a press release and financial statement summary available shortly thereafter on the Investor Relations page of Vicor's website [2]. - Investors and analysts wishing to ask questions during the conference call must register with Notified, the service provider hosting the call, to receive dial-in information and a unique PIN [3]. - A listen-only mode will be available via a webcast link posted on Vicor's Investor Relations page prior to the conference call, with a recommendation to access the website at least 15 minutes before the call [4]. Group 2: Post-Call Information - For those unable to participate in the live conference call, a replay of the webcast will be available on Vicor's Investor Relations page [5]. Group 3: Company Overview - Vicor Corporation designs, develops, manufactures, and markets modular power components and complete power systems based on patented technologies, serving various markets including enterprise computing, industrial automation, telecommunications, and aerospace [6].

Core Insights - The automotive industry is transitioning to 800V batteries and 48V zonal architecture, creating a demand for efficient power conversion solutions [1][2] - Vicor's new automotive-grade power modules are designed to address the challenges of high voltage to 48V and 12V conversion, focusing on performance optimization, size reduction, and cost efficiency [1][2] Company Overview - Vicor Corporation specializes in designing, developing, manufacturing, and marketing modular power components and complete power systems, leveraging patented technologies [5] - The company serves various markets, including enterprise computing, industrial automation, telecommunications, and transportation [5][6] Industry Event - Vicor will present at the World Congress Experience (WCX) 2025 in Detroit from April 8-10, showcasing high power density DC-DC converter modules [2][4] - The presentation will focus on optimizing high voltage to point of load conversion in electrified vehicles, addressing current automotive electrification challenges [2][4]

Core Insights - Vicor has launched a new family of DCMs (DCM3717 and DCM3735) designed for 48V-centric power delivery networks, enhancing system efficiency and performance [1][3] - The DCMs offer power levels ranging from 750W to 2kW, achieving an industry-leading power density of 5kW/in3, which allows for scalable solutions through parallel device configurations [1][3] Company Overview - Vicor Corporation specializes in designing, developing, manufacturing, and marketing modular power components and complete power systems, leveraging a portfolio of patented technologies [4] - The company is headquartered in Andover, Massachusetts, and serves various markets including enterprise computing, industrial automation, telecommunications, and aerospace [4]

Financial Performance - Total net revenues for 2024 were $359,058, a decrease of 11.3% from $405,059 in 2023[212]. - Product revenue declined to $312,463 in 2024, down 19.7% from $389,187 in 2023[212]. - Consolidated net income for 2024 was $6,139, a significant decrease of 88.5% from $53,600 in 2023[212]. - The company reported a basic net income per share of $0.14 for 2024, down from $1.21 in 2023[212]. - The company’s net income attributable to Vicor Corporation for the year ended December 31, 2024, was $6,129,000, compared to $53,595,000 in 2023 and $25,446,000 in 2022, indicating a significant decline in profitability[267]. - In 2024, the Company reported income before income taxes of $10,487,000, a decrease of 82.6% from $60,244,000 in 2023[338]. Revenue Sources - Revenues from the United States increased to $185,834,000 in 2024, up 24.3% from $149,456,000 in 2023[305]. - Revenues from Asia Pacific decreased to $129,981,000 in 2024, down 32.4% from $192,267,000 in 2023[305]. - Approximately 12.6% of total net revenues in 2024 came from customers in China, down from 17.7% in 2023[309]. Expenses and Liabilities - Operating expenses increased to $185,308 in 2024, up 20.6% from $153,571 in 2023, primarily due to litigation-contingency expenses of $19,500[212]. - The effective income tax rate for 2024 was 41.5%, significantly higher than 11.0% in 2023, primarily due to an increase in valuation allowance[336]. - The Company recorded a litigation-related accrual of $26,000,000 in 2024 due to a patent infringement lawsuit, including enhanced damages and attorney fees[351]. Assets and Investments - Total assets increased to $641,118 in 2024, up 7.8% from $594,887 in 2023[210]. - Cash and cash equivalents at the end of 2024 were $277,273, an increase of 14.5% from $242,219 at the end of 2023[219]. - The company has a valuation allowance of $61.5 million against domestic deferred tax assets, indicating potential challenges in realizing these assets[205]. - The Company’s total deferred tax assets increased to $81,541,000 in 2024 from $71,052,000 in 2023, with a net deferred tax asset of $20,010,000[338]. Inventory and Production - Approximately 74% or $78.9 million of the company's total inventory balance is comprised of raw materials, indicating a significant reliance on these materials for operations[201]. - As of December 31, 2024, inventories totaled $106,032,000, a slight decrease from $106,579,000 in 2023, with raw materials at $78,934,000 and finished goods at $10,709,000[274]. - Vicor's inventory is valued at the lower of cost or net realizable value, with production overhead allocated based on normal capacity, ensuring accurate cost management[239]. Foreign Currency and Interest Rates - A 10% unfavorable movement in the value of the Japanese Yen relative to the U.S. Dollar would increase the company's foreign currency loss by approximately $49,000[191]. - The company estimates that its annual interest income would change by approximately $30,000 for each 100 basis point increase or decrease in interest rates[190]. - The company reported net interest income of $11.47 million in 2024, an increase from $8.22 million in 2023[335]. Business Strategy and Market Focus - The company is transitioning its business model to serve a smaller number of larger volume customers, which may impact future revenue streams[1]. - The company plans to expand the percentage of revenue associated with licensing its intellectual property to third parties[1]. - Vicor's principal markets include large OEMs and ODMs, indicating a focus on high-volume users in the power components sector[224]. Research and Development - Research and development expenses were $68,922 in 2024, slightly up from $67,857 in 2023, indicating continued investment in innovation[212]. - The Company has federal and state research and development tax credit carryforwards of $12,344,000 and $21,892,000, expiring in 2039 and 2025, respectively[341]. Stock and Compensation - Stock-based compensation expense rose from $12.869 million in 2022 to $15.302 million in 2023, marking an increase of 18.9%[221]. - The total grant-date fair value of stock options granted was approximately $19.28 million in 2024, up from $17.96 million in 2023[323]. - The company had approximately $26.27 million of total unrecognized compensation cost related to unvested awards as of December 31, 2024, expected to be recognized over a weighted-average period of 2.0 years[324]. Legal and Regulatory Matters - The company is involved in ongoing litigation, including a class action lawsuit related to alleged misleading statements during earnings calls in 2023[355]. - The Company faces uncertainties in forecasting operating results due to unpredictability in customer orders and product transitions[340].

Core Viewpoint - Vicor's stock experienced significant gains following the release of its strong fourth-quarter earnings report, outperforming market expectations despite broader market declines [1][2]. Financial Performance - Vicor reported earnings per share of $0.23 on sales of $96.2 million for the fourth quarter, exceeding Wall Street's expectations of $0.14 per share on approximately $91 million in sales [3]. - The company's revenue increased by 3.8% year-over-year, contrary to analyst expectations of a modest sales decline [4]. - Gross margins improved to 52.4% in Q4, up from 49.1% in Q3, contributing to a 21% year-over-year increase in earnings per share [4]. Future Outlook - Although management did not provide specific guidance for the first quarter, Vicor aims to enhance chip fabrication plant utilization and increase licensing revenue as potential growth catalysts [5]. - The company is targeting $1 billion in annual revenue and a gross margin of 65% in the future [5].

Financial Data and Key Metrics Changes - Vicor recorded total revenue for Q4 2024 of $96.2 million, up 3.2% from Q3 2024 and up 3.8% from Q4 2023. However, revenues for the full year 2024 decreased 11.4% to $359.1 million from $405.1 million in the prior year [9][10] - The consolidated gross profit margin for Q4 was 52.4%, approximately 3.3% higher than the prior quarter, while the full year gross margin rose by 0.7% to 51.2% from 50.6% in the prior year [12][13] - Operating income for Q4 was $9.2 million, representing an operating margin of 9.6%, while the full year 2024 recorded an operating loss of $1.3 million, or negative 0.4% of revenue [15][17] Business Line Data and Key Metrics Changes - Advanced Products revenue increased 18% sequentially, while Brick Products revenue declined 13% from the third quarter. For the year, Advanced Products revenue decreased 11.9% to $197.3 million, and Brick Products revenue decreased 10.7% to $161.7 million [10][11] - Advanced Products accounted for 60.6% of total revenue in Q4, up from 53% in Q3, while Brick Products' share decreased to 39.4% [12] Market Data and Key Metrics Changes - Shipments to stocking distributors decreased 4% sequentially but increased 7.6% year-over-year. Exports as a percentage of total revenue increased to approximately 56.9% from 49% in the prior quarter, but decreased year-over-year to approximately 48.2% from 63.1% [11] Company Strategy and Development Direction - The company aims to capitalize on opportunities in 2025, focusing on refining processes and scaling up capacity in its ChiP fab, while also protecting its intellectual property [23][24] - The successful ramp of the new vertically integrated ChiP factory is expected to improve operational efficiency and customer responsiveness [24] - The company is focused on delivering its ultra-high density, high bandwidth Gen 5 VPD system to lead customers and is optimistic about growth in various sectors, including aerospace, defense, and automotive [26][29] Management's Comments on Operating Environment and Future Outlook - Management described 2025 as a year of uncertainty and opportunity, with a wide range of possible outcomes for top-line and bottom-line performance [20] - The company is optimistic about its position at the start of 2025 compared to the previous year, despite acknowledging ongoing challenges [30] Other Important Information - The company ended Q4 with cash and cash equivalents totaling $277.3 million, and accounts receivable net of reserves totaled $52.9 million [18] - The book-to-bill ratio improved to above 1 in Q4, with a one-year backlog increasing 3.3% from the prior quarter to $155.5 million [19] Q&A Session Summary Question: Can you elaborate on the delay in the VPD products? - Management indicated that the delay was due to the need for a new ASIC to achieve performance goals, which is expected to be completed by the end of February, allowing for rapid progress in March [34][35] Question: How significant are the new NBM product orders from the hyperscaler? - Management confirmed that the new orders are meaningful and will contribute to filling the ChiP fab, although it will take time to see significant changes in capacity utilization [48][50] Question: What are the uncertainties related to HPC versus other markets? - Management stated that uncertainties primarily revolve around AI and high-end computing, while other markets like automotive and aerospace are stable and growing [55][57] Question: Can you provide details on the bond mechanics related to the ITC case? - Management explained that the bond must be posted for the importation of infringing products during a 60-day presidential review period, set at 100% of the product's value [93][94] Question: Are there plans for a new factory? - Management indicated that while planning for a new factory is underway, the focus remains on filling the current factory efficiently before considering expansion [131][134]

Financial Performance - Revenues for Q4 2024 totaled $96.2 million, a 3.8% increase from $92.7 million in Q4 2023, and a 3.2% sequential increase from $93.2 million in Q3 2024[2] - Net income for Q4 2024 was $10.2 million, or $0.23 per diluted share, compared to $8.7 million or $0.19 per diluted share in Q4 2023[4] - Revenues for the year ended December 31, 2024 decreased 11.4% to $359.1 million from $405.1 million in 2023[7] - Net income for 2024 was $6.1 million, or $0.14 per diluted share, compared to $53.6 million or $1.19 per diluted share in 2023[7] Margins and Cash Flow - Gross margin for Q4 2024 increased to $50.4 million, representing 52.4% of revenue, compared to 51.1% in Q4 2023 and 49.1% in Q3 2024[3] - Gross margin for the year ended December 31, 2024 was 51.2%, up from 50.6% in the prior year[7] - Cash flow from operations for Q4 2024 was $10.1 million, down from $21.5 million in Q4 2023[5] Backlog and Future Outlook - Backlog for Q4 2024 totaled $155.5 million, a 3.3% decrease from $160.8 million in Q4 2023, but a 3.3% sequential increase from $150.6 million in Q3 2024[6] - The company is focused on completing development of a high-density VPD system for a lead customer, which is expected to enhance performance and power system efficiency for AI applications[9] - The CEO indicated that further margin improvements depend on higher utilization of the ChiP fab and increased licensing income, which is gaining traction with companies reliant on high-density power systems[8]

Core Insights - Vicor Corporation reported financial results for Q4 and the year ended December 31, 2024, highlighting improvements in revenues and gross margins despite a decline in annual revenues [1][7]. Financial Performance - Q4 revenues reached $96.2 million, marking a 3.8% increase year-over-year from $92.7 million and a 3.2% sequential increase from $93.2 million in Q3 2024 [2]. - Gross margin for Q4 was $50.4 million, up from $47.3 million year-over-year and $45.7 million sequentially, with gross margin percentage increasing to 52.4% from 51.1% year-over-year and 49.1% sequentially [3]. - Net income for Q4 was $10.2 million, or $0.23 per diluted share, compared to $8.7 million or $0.19 per diluted share in the same period last year, but down from $11.6 million or $0.26 per diluted share in Q3 2024 [4]. - Cash flow from operations for Q4 totaled $10.1 million, a decrease from $21.5 million year-over-year and $22.6 million in Q3 2024 [5]. - The backlog for Q4 was $155.5 million, a 3.3% decrease from $160.8 million year-over-year but a 3.3% sequential increase from $150.6 million at the end of Q3 2024 [6]. Annual Overview - For the year ended December 31, 2024, revenues decreased by 11.4% to $359.1 million from $405.1 million in the prior year [7]. - The gross margin percentage for the year improved to 51.2% from 50.6% in the prior year [7]. - Annual net income was $6.1 million, or $0.14 per diluted share, significantly down from $53.6 million or $1.19 per diluted share in the previous year [7]. - Cash flows from operations for the year totaled $50.8 million, a 31.8% decrease from $74.5 million in the prior year [7]. Strategic Insights - CEO Dr. Patrizio Vinciarelli noted that revenue and gross margins improved, with further margin enhancements expected from higher utilization of the ChiP fab and increased licensing income [8]. - The company is focused on completing the development of a high-density VPD system for AI applications, which is anticipated to set new standards for performance and efficiency [8].