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Navitas Semiconductor (NVTS) - 2024 Q4 - Earnings Call Transcript
NVTSNavitas Semiconductor (NVTS)2025-02-25 03:34
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Financial Data and Key Metrics Changes - The company reported an all-time high revenue of 83millionforthefullyear2024,representinga583 million for the full year 2024, representing a 5% increase from 79.5 million in 2023 [8][22] - Fourth quarter revenue was 18million,consistentwithguidance,butshowedadeclineprimarilyduetolowerrevenuesintheEV,solar,andindustrialmarkets[21][22]−Non−GAAPgrossmarginforthefullyear2024was40.418 million, consistent with guidance, but showed a decline primarily due to lower revenues in the EV, solar, and industrial markets [21][22] - Non-GAAP gross margin for the full year 2024 was 40.4%, down from 41.8% in 2023, attributed to a less favorable market mix [24] Business Line Data and Key Metrics Changes - The GaN business grew over 50% in 2024, driven by strong demand in mobile, consumer, and appliance segments, with initial data center revenues starting in the second half of the year [9][23] - The EV pipeline expanded to over 900 million, up from 400millionayearago,nowrepresentingnearly40400 million a year ago, now representing nearly 40% of the total 2.4 billion pipeline [15] - The data center sector saw the highest growth rates with 40 customer project wins throughout the year, significantly increasing the customer pipeline to over 165million[11][12]MarketDataandKeyMetricsChanges−Thecustomerpipelinenearlydoubledfrom165 million [11][12] Market Data and Key Metrics Changes - The customer pipeline nearly doubled from 1.25 billion at the end of 2023 to 2.4billionattheendof2024,indicatingstrongexpectedexpansioninmajormarkets[10]−ThecompanyexpectsaQ1revenuedeclineduetotypicalseasonalityandongoinginventorycorrectionsinthesolar,EV,andindustrialmarkets,withamodestrecoveryanticipatedinQ2[20][28]CompanyStrategyandDevelopmentDirection−ThecompanyisfocusingonstrategicapplicationsintheEVspace,leveragingbothGaNandsiliconcarbidetechnologies,particularlyinonboardandroadsidechargers[39][41]−AmajortechnologyannouncementisplannedforMarch12,whichisexpectedtoacceleratetheadoptionofGaNandsiliconcarbideinmulti−billiondollarmarkets[19]Management′sCommentsonOperatingEnvironmentandFutureOutlook−ManagementviewsQ1asacyclicalbottom,withexpectationsforrecoverystartinginQ2andhealthygrowthinthesecondhalfof2025[36]−ThecompanyiscautiouslyoptimisticaboutthesolarmarketasGaNadoptionisexpectedtoincreasemid−year,whiletheEVmarketshowssignsofimprovement,particularlyinChina[35][92]OtherImportantInformation−ThecompanyendedQ4with2.4 billion at the end of 2024, indicating strong expected expansion in major markets [10] - The company expects a Q1 revenue decline due to typical seasonality and ongoing inventory corrections in the solar, EV, and industrial markets, with a modest recovery anticipated in Q2 [20][28] Company Strategy and Development Direction - The company is focusing on strategic applications in the EV space, leveraging both GaN and silicon carbide technologies, particularly in onboard and roadside chargers [39][41] - A major technology announcement is planned for March 12, which is expected to accelerate the adoption of GaN and silicon carbide in multi-billion dollar markets [19] Management's Comments on Operating Environment and Future Outlook - Management views Q1 as a cyclical bottom, with expectations for recovery starting in Q2 and healthy growth in the second half of 2025 [36] - The company is cautiously optimistic about the solar market as GaN adoption is expected to increase mid-year, while the EV market shows signs of improvement, particularly in China [35][92] Other Important Information - The company ended Q4 with 87 million in cash and no debt, indicating a strong liquidity position [27][68] - Operating expenses for Q1 are expected to be reduced to 18million,withatargetofapproximately18 million, with a target of approximately 15.5 million per quarter thereafter [31][46] Q&A Session Summary Question: Where do you think the cyclical bottom is? - Management believes Q1 represents a cyclical bottom, with recovery expected to start in Q2 and healthy growth in the second half of the year [36] Question: How is the silicon carbide market performing? - The market slowdown is primarily due to declines in EV, solar, and industrial sectors, but management is optimistic about future growth driven by design wins in the EV space [39] Question: What is the expected operating expense level beyond Q1? - Operating expenses are expected to stabilize at approximately $15.5 million, with no further fat to trim as the business is right-sized for growth [46][47] Question: Can you describe the design wins in the data center space? - The company achieved 40 design wins in the data center sector, with a focus on high-density power supplies, indicating strong market demand [11][102] Question: How is the competitive landscape changing? - Management has observed stabilization in ASP erosion and inventory levels, particularly in the silicon carbide market, while GaN remains healthier [86] Question: What is the outlook for 2025 sales between GaN and silicon carbide? - Both technologies are expected to grow, with a focus on data centers and EV onboard chargers driving demand for both GaN and silicon carbide [92]