Stonegate Capital Partners Updates Coverage on Valens Semiconductor Ltd. (VLN) Q2 25

Group 1 - Valens Semiconductor Ltd. reported Q2 2025 revenue of $17.1 million, exceeding guidance of $16.5 to $16.8 million, marking a 26% year-over-year increase from $13.6 million in Q2 2024 [1][8] - The company achieved a GAAP gross margin of 63.5% and a non-GAAP gross margin of 67.2%, both within guidance and an increase from 62.9% in Q1 2025 [1][8] - Adjusted EBITDA loss improved to $(4.0) million, better than the expected range of $(4.9) to $(4.4) million, and down from $(5.2) million in the previous year [1][8] Group 2 - The growth was driven by strong demand in ProAV and industrial sectors, with the company launching its first MIPI A-PHY standard platform in industrial machine vision and expanding VS3000-based products to approximately 150 [1][8] - Despite strong momentum, the company faces headwinds from tariff impacts, particularly in the automotive sector [1] - The outlook for the company remains uncertain for the end of FY25, but steady growth is expected through 2026 and beyond as ProAV inventories correct and the automotive outlook improves [1]