Silvaco Group Earnings Call Transcripts
Fiscal Year 2026
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Achieved first non-GAAP operating profit since 2024, with 48% year-over-year revenue growth and record IP performance. Strategic partnerships with NVIDIA, Dassault Systèmes, and Micron strengthen AI manufacturing capabilities, supporting expectations for record Q4 revenue and double-digit growth in 2027.
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EDA industry growth has stabilized at low double digits, with AI and new markets driving future expansion. Silvaco is leveraging its strengths in TCAD, AI-driven FTCO, and IP to outperform the industry, supported by cost reductions and strong momentum in power semiconductors and photonics.
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Q1 saw 26% year-over-year growth in bookings and revenue, with gross margins at record highs and non-GAAP operating loss halved sequentially. AI-driven FTCO and IP segments showed strong momentum, and guidance points to non-GAAP operating profitability in Q2.
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Silvaco is focusing on cost reduction, niche market leadership, and leveraging AI-driven solutions for long-term growth. Recent acquisitions like Mixel and partnerships such as with Micron are expected to drive future expansion, while profitability improvements are prioritized through expense cuts and targeted revenue growth.
Fiscal Year 2025
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Q4 saw bookings and revenue at the high end of guidance, with strong growth in IP and TCAD segments, improved gross margins, and accelerated cost reductions. AI-driven FTCO adoption and Mixel acquisition fueled momentum, supporting a positive outlook for 2026.
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Record Q3 revenue and bookings were driven by EDA contract wins, but profitability remains a challenge as expenses have outpaced revenue. Cost reduction initiatives and a focus on core growth products and recent acquisitions are expected to drive margin improvement and double-digit growth in 2026.
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The company reported strong growth in 2024, expanding its market through innovation in TCAD and AI-driven manufacturing tools, and executing three strategic acquisitions. FTCO adoption is accelerating, with significant cost savings for customers and a growing presence in China and quantum computing.
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Q2 2025 revenue and bookings declined year-over-year due to order delays and macro headwinds, but annual contract value grew 26%. Recent acquisitions expanded the addressable market and are expected to drive future growth, with guidance maintained for FY2025.
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The company is expanding rapidly in the design software space, growing its addressable market to $4.4 billion through acquisitions and innovation in AI-driven fab optimization. Financials show strong ACV and margin growth, with strategic focus on power, photonics, and memory markets.
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Q1 2025 revenue and bookings declined year-over-year due to macroeconomic headwinds and order delays, but recent acquisitions expanded the addressable market and are expected to drive growth. Guidance for FY2025 remains conservative, with confidence in long-term targets and new metrics introduced to reflect recurring revenue.
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AI-driven software solutions for digital twin modeling and simulation are fueling rapid customer growth, record bookings, and margin expansion. Strategic moves include new market entries, M&A, and advanced R&D, with a focus on analog, display, and power segments.
Fiscal Year 2024
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Record Q4 and FY 2024 results driven by DTCO and EDA adoption, with 46 new customers and strong growth in power and memory markets. The OPC acquisition expands the addressable market, though 2025 revenue impact will be modest due to transition. FY 2025 guidance projects double-digit growth and high margins.
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Q3 revenue declined 27% year-over-year due to delayed orders, but year-to-date revenue was flat and full-year guidance remains for 10–16% growth. Gross margin stayed strong at 80% non-GAAP, and a $5M FTCO order is expected to boost Q4 to record revenue. Delays in China are seen as temporary, not lost sales.
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AI-driven digital twin modeling is expanding applications from semiconductor design to manufacturing, with strong traction in memory and plans to enter power and advanced CMOS markets. High-margin growth is supported by a focused M&A strategy and increasing demand for simulation tools in emerging technologies.
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Q2 revenue grew 19% YoY to $15M, with bookings up 36% and non-GAAP gross margin at 86%. Strong TCAD and FTCO product demand, 10 new customer wins, and robust U.S. sales offset China softness and a $14.7M litigation charge. Full-year guidance and long-term growth targets remain strong.