Vicor(VICR) - 2025 Q3 - Quarterly Results

Third Quarter 2025 Financial Highlights Vicor reported increased Q3 2025 revenues, improved gross margin, and significant net income growth, supported by strong operational cash flow Key Financial Results Vicor Corporation reported Q3 2025 product revenues and licensing income of $110.4 million, an 18.5% YoY increase, with gross margin at 57.5% and net income of $28.3 million Total Product Revenues and Licensing Income | Metric | Q3 2025 (in millions) | Q3 2024 (in millions) | YoY Change | Q2 2025 (in millions) | QoQ Change | | :----- | :------ | :------ | :--------- | :------ | :--------- | | Total Product Revenues & Licensing Income | $110.4 | $93.2 | +18.5% | $141.0 | -21.7% | Gross Margin Performance | Metric | Q3 2025 (in millions) | Q3 2024 (in millions) | YoY Change | Q2 2025 (in millions) | QoQ Change | | :----- | :------ | :------ | :--------- | :------ | :--------- | | Gross Margin (absolute) | $63.5 | $45.7 | +38.9% | $92.1 | -31.0% | | Gross Margin (% of revenue) | 57.5% | 49.1% | +8.4 pp | 65.3% | -7.8 pp | Operating Expenses | Metric | Q3 2025 (in millions) | Q3 2024 (in millions) | YoY Change | Q2 2025 (in millions) | QoQ Change | | :----- | :------ | :------ | :--------- | :------ | :--------- | | Operating Expenses | $42.6 | $40.4 | +5.4% | $46.7 | -8.8% | Net Income and Diluted EPS | Metric | Q3 2025 (in millions, except EPS) | Q3 2024 (in millions, except EPS) | YoY Change | Q2 2025 (in millions, except EPS) | QoQ Change | | :----- | :------ | :------ | :--------- | :------ | :--------- | | Net Income | $28.3 | $11.6 | +144.0% | $41.2 | -31.3% | | Diluted EPS | $0.63 | $0.26 | +142.3% | $0.91 | -30.7% | Operational Metrics Cash flow from operations significantly increased to $38.5 million, while capital expenditures decreased, and cash and equivalents grew 7.0% sequentially Cash Flow from Operations | Metric | Q3 2025 (in millions) | Q3 2024 (in millions) | YoY Change | Q2 2025 (in millions) | QoQ Change | | :----- | :------ | :------ | :--------- | :------ | :--------- | | Cash Flow from Operations | $38.5 | $22.6 | +70.4% | $65.2 | -40.9% | Capital Expenditures | Metric | Q3 2025 (in millions) | Q3 2024 (in millions) | YoY Change | Q2 2025 (in millions) | QoQ Change | | :----- | :------ | :------ | :--------- | :------ | :--------- | | Capital Expenditures | $4.0 | $8.4 | -52.4% | $6.2 | -35.5% | Stock Repurchases | Metric | Q3 2025 (in millions) | Q2 2025 (in millions) | QoQ Change | | :----- | :------ | :------ | :--------- | | Stock Repurchases | $15.6 | $17.5 | -11.0% | Cash and Cash Equivalents | Metric | Sept 30, 2025 (in millions) | June 30, 2025 (in millions) | QoQ Change | | :----- | :------------ | :------------ | :--------- | | Cash and Cash Equivalents | $362.4 | $338.5 | +7.0% | Backlog | Metric | Sept 30, 2025 (in millions) | Sept 30, 2024 (in millions) | YoY Change | June 30, 2025 (in millions) | QoQ Change | | :----- | :------------ | :------------ | :--------- | :------------ | :--------- | | Backlog | $152.8 | $150.6 | +1.5% | $155.2 | -1.5% | Management's Commentary CEO highlighted record Q3 licensing revenue from a settlement, anticipating substantial IP licensing growth and improved margins from ChiP foundry utilization - Licensing revenue reached a record rate in Q3 following the litigation settlement for prior infringement recorded in Q2[7] - Vicor expects its IP licensing practice to grow substantially as high-density power systems (NBMs and VPD) are critical for high-performance computing, requiring OEMs and hyper-scalers to obtain or renew licenses[7] - The company's high-density power module business leverages its first ChiP foundry, which delivers 98% final test yields and has a capacity exceeding $1 billion per year, with higher margins expected from greater absorption of this capacity[7] Company Overview Vicor Corporation designs and markets modular power components for diverse markets, providing investor information via its website and CFO About Vicor Corporation Vicor Corporation specializes in designing, manufacturing, and marketing modular power components and systems for various high-performance markets - Vicor Corporation designs, develops, manufactures, and markets modular power components and complete power systems based on patented technologies[11] - The company's products are sold to various power systems markets, including enterprise and high-performance computing, industrial equipment and automation, telecommunications and network infrastructure, vehicles and transportation, and aerospace and defense electronics[11] Investor Information Investors can find product information on Vicor's website and contact the Chief Financial Officer for further inquiries - Company website for product information: **www.vicorpower.com**[8](index=8&type=chunk) - Investor contact: James F. Schmidt, Chief Financial Officer, Office: (978) 470-2900, Email: invrel@vicorpower.com[12] Condensed Consolidated Financial Statements This section presents Vicor Corporation's detailed condensed consolidated statements of operations and balance sheets for the reported periods Condensed Consolidated Statement of Operations The statement details Q3 and YTD 2025 revenues, costs, and profitability, showing significant increases in net income and EPS YoY Condensed Consolidated Statement of Operations (Thousands except for per share amounts) | | | QUARTER ENDED | | | YEAR ENDED | | | --- | --- | --- | --- | --- | --- | --- | | | | (Unaudited) | | | (Unaudited) | | | | SEPT 30, | | SEPT 30, | | SEPT 30, | SEPT 30, | | | 2025 | | 2024 | | 2025 | 2024 | | Product revenue | $ 88,698 | | $79,796 | | $257,597 | $ 232,071 | | Royalty revenue | 21,725 | | 13,370 | | 42,840 | 30,821 | | Patent litigation settlement | — | | — | | 45,000 | — | | Total product revenue, royalty revenue and patent litigation settlement | 110,423 | | 93,166 | | 345,437 | 262,892 | | Cost of product revenues | 46,910 | | 47,422 | | 145,431 | 129,254 | | Gross margin | 63,513 | | 45,744 | | 200,006 | 133,638 | | Operating expenses: | | | | | | | | Selling, general and administrative | 22,747 | | 23,398 | | 75,836 | 72,715 | | Research and development | 19,859 | | 16,960 | | 58,027 | 51,938 | | Litigation-contingency expense | — | | — | | — | 19,500 | | Total operating expenses | 42,606 | | 40,358 | | 133,863 | 144,153 | | Income (loss) from operations | 20,907 | | 5,386 | | 66,143 | (10,515) | | Other income (expense), net | 2,407 | | 3,713 | | 9,198 | 9,244 | | Income (loss) before income taxes | 23,314 | | 9,099 | | 75,341 | (1,271) | | Less: (Benefit) provision for income taxes | (4,988) | | (2,455) | | 3,278 | 2,832 | | Consolidated net income (loss) | 28,302 | | 11,554 | | 72,063 | (4,103) | | Less: Net income attributable to noncontrolling interest | 10 | | 2 | | 40 | 14 | | Net income (loss) attributable to Vicor Corporation | $ 28,292 | | $11,552 | | $ 72,023 | ($ 4,117) | | Net income (loss) per share attributable to Vicor Corporation: | | | | | | | | Basic | $ 0.63 | | $ 0.26 | $ | 1.60 | ($ 0.09) | | Diluted | $ 0.63 | | $ 0.26 | $ | 1.59 | ($ 0.09) | | Shares outstanding: | | | | | | | | Basic | 44,734 | | 45,117 | | 44,986 | 44,829 | | Diluted | 44,930 | | 45,174 | | 45,167 | 44,829 | Condensed Consolidated Balance Sheet The balance sheet presents Vicor Corporation's financial position as of September 30, 2025, showing increased total assets and stockholders' equity Condensed Consolidated Balance Sheet (Thousands) | | SEPT 30. | DEC 31. | | --- | --- | --- | | | 2025 (Unaudited) | 2024 (Unaudited) | | Assets | | | | Current assets: | | | | Cash and cash equivalents | $ 362,382 | $ 277,273 | | Accounts receivable, net | 53,252 | 52,948 | | Inventories | 92,294 | 106,032 | | Other current assets | 25,985 | 26,781 | | Total current assets | 533,913 | 463,034 | | Long-term deferred tax assets | 275 | 261 | | Long-term investment, net | 2,406 | 2,641 | | Property, plant and equipment, net | 152,526 | 152,705 | | Other assets | 21,127 | 22,477 | | Total assets | $ 710,247 | $ 641,118 | | Liabilities and Equity | | | | Current liabilities: | | | | Accounts payable | 15,391 | 8,737 | | Accrued compensation and benefits | 13,438 | 10,852 | | Accrued expenses | 5,437 | 6,589 | | Accrued litigation | 27,919 | 26,888 | | Sales allowances | 2,569 | 1,667 | | Short-term lease liabilities | 1,584 | 1,716 | | Income taxes payable | 154 | 0 | | Short-term deferred revenue and customer prepayments | 4,197 | 5,312 | | Total current liabilities | 70,689 | 61,820 | | Long-term income taxes payable | 3,430 | 3,387 | | Long-term lease liabilities | 5,775 | 5,620 | | Total liabilities | 79,894 | 70,827 | | Equity: | | | | Vicor Corporation stockholders' equity: | | | | Capital stock | 429,542 | 408,187 | | Retained earnings | 374,826 | 302,803 | | Accumulated other comprehensive loss | (1,561) | (1,495) | | Treasury stock | (172,728) | (139,424) | | Total Vicor Corporation stockholders' equity | 630,079 | 570,071 | | Noncontrolling interest | 274 | 220 | | Total equity | 630,353 | 570,291 | | Total liabilities and equity | $ 710,247 | $ 641,118 | Additional Disclosures This section provides details on the upcoming earnings conference call and important forward-looking statement disclaimers Earnings Conference Call Vicor will host an investor conference call on October 21, 2025, to discuss Q3 results, requiring registration for participants - Date and Time: Tuesday, October 21, 2025, at 5:00 p.m. Eastern Time[9] - Registration is required for participants intending to ask questions, providing dial-in info and a unique PIN[9] - A listen-only webcast will be available on the Investor Relations page of Vicor's website, with a replay also accessible after the live call[9] Forward-Looking Statements This press release contains forward-looking statements subject to risks and uncertainties, with actual results potentially differing materially from projections - The press release contains forward-looking statements identified by words like 'expects,' 'anticipates,' and 'plans,' covering aspects such as revenue, profitability, and manufacturing capacity[10] - Actual results may differ materially due to various economic, business, operational, and financial factors, as detailed in Vicor's Form 10-K and other SEC filings[10] - Vicor does not undertake any obligation to update any forward-looking statements as a result of future events or developments[10]