Silicom .(US:SILC)2025-04-28 14:02Financial Data and Key Metrics Changes - Revenues for Q1 2025 were $14,400,000, consistent with targets and the same as Q1 2024 [8][23] - Gross profit was $4,400,000, representing a gross margin of 30.3%, up from $4,100,000 and 28.5% in Q1 2024 [24] - Operating loss decreased to $2,400,000 from $2,700,000 year-over-year, while net loss improved to $2,100,000 from $2,400,000 [25] Business Line Data and Key Metrics Changes - The company reported significant design win momentum, with three new design wins in 2025, including contracts with cybersecurity leaders and a global network test equipment company [10][12][15] - The focus on core product lines and deep customer relationships has created a solid pipeline for future growth [9][16] Market Data and Key Metrics Changes - Geographical revenue breakdown showed North America at 70.8%, Europe and Israel at 14%, and the Far East and Rest of the World at 8% [23] - The top 210%+ customers accounted for about 24% of revenues over the last twelve months [23] Company Strategy and Development Direction - The company aims for a return to solid double-digit growth rates starting in 2026, with long-term financial goals of achieving EPS above $3 based on revenues between $150,000,000 and $160,000,000 [9][20] - A robust pipeline of opportunities across various product lines is expected to drive future growth, with a focus on building long-term relationships with customers [17][18] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about accelerating revenue growth in 2026 and beyond, supported by a strong balance sheet and no debt [8][21] - The company anticipates low single-digit growth for 2025, with double-digit growth expected for 2026 [19] Other Important Information - The company has a strong balance sheet with $119,000,000 in working capital and marketable securities, including $77,000,000 in cash [8][25] - The share buyback program saw the purchase of nearly 100,000 shares in Q1 2025, with about $8,000,000 remaining in the program [44][48] Q&A Session Summary Question: What milestones are tracked for design wins? - Management outlined milestones including customization development, shipping samples, and mass production readiness [28][29][30] Question: Is there increased demand for FPGA-based products? - Management confirmed strong demand across all product lines, including FPGA, and highlighted a recent strategic partnership for cybersecurity solutions [31][32] Question: What is the impact of tariffs? - Currently, the company's products are exempt from tariffs, and management is monitoring the situation closely [33][34][36] Question: Update on share buyback program? - The company purchased nearly 100,000 shares in Q1 2025, with over $8,000,000 remaining in the buyback program [44][48] Question: Are major customers reordering after excess inventory? - Management noted some relief in excess inventory issues, with some customers beginning to reorder, but the situation varies by customer [50][51][52]