Navitas Semiconductor Corporation ((NVTS)) has held its Q1 earnings call. Read on for the main highlights of the call.
In the latest earnings call, Navitas Semiconductor Corporation presented a mixed sentiment, balancing optimism for future growth with current financial challenges. The company highlighted significant technological advancements and strategic initiatives, such as the release of bidirectional GaN ICs and automotive qualifications. However, these positive developments were offset by ongoing revenue and gross margin declines, continued market softness, and potential tariff impacts.
First Production Release of Bidirectional GaN IC
Navitas announced the industry’s first production release of a bidirectional GaN IC, a groundbreaking technology that consolidates traditional two-stage converters into a single stage. This innovation promises significant improvements in size, weight, cost, and power loss by 30% or more, marking a substantial leap forward in semiconductor technology.
GaNSafe Technology Automotive Qualification
The company’s GaNSafe technology has achieved automotive qualification to the rigorous AEC-Q101 standard. This milestone has led to its adoption in the industry’s first GaN EV onboard charger design with Changan Auto, with production anticipated in early 2026, underscoring Navitas’ commitment to advancing automotive technology.
Significant Commercial EV Wins
Navitas reported significant wins in the commercial EV sector, forecasting a multimillion-dollar impact in 2026. These wins are particularly notable in markets that demand higher power and reliability, positioning the company for future success in the EV industry.
12 Kilowatt Design for Data Centers
The company unveiled a new 12 kilowatt design for data centers, an industry-first enabled by GaN and silicon carbide technologies. This development is set to significantly increase rack power, showcasing Navitas’ innovation in addressing the needs of modern data centers.
Strong Pipeline with Over 75 Customer Projects
Navitas boasts a robust pipeline with over 75 customer projects in production or development, utilizing silicon carbide, GaN, or both. This diverse project portfolio points to strong future growth prospects and underscores the company’s strategic focus on innovation.
Separation of Chair and CEO Roles
In a strategic move to accelerate its transition to greater scale and profitability, Navitas announced the separation of the chair and CEO roles. This organizational change is aimed at enhancing leadership focus and operational efficiency.
Revenue Decline
The company reported a revenue of $14 million for Q1 2025, aligning with guidance but reflecting a sequential decline due to seasonality, soft demand, and inventory corrections. This decline highlights the challenges Navitas faces in the current market environment.
Gross Margin Decline
Navitas experienced a decline in gross margin to 38.1% in the first quarter, down from 40.2% in the previous quarter. This decrease was primarily attributed to a less favorable market mix, indicating ongoing financial pressures.
Continued Softness and Inventory Corrections
The company anticipates revenues for the second quarter to remain between $14 million and $15 million, reflecting continued softness and inventory corrections in the solar, EV, and industrial markets. This outlook suggests ongoing challenges in these sectors.
Impact of Tariffs
Tariffs, particularly between China and the U.S., pose a risk to Navitas, with potential adverse effects on silicon carbide revenues in the latter half of the year. This geopolitical factor adds an element of uncertainty to the company’s financial outlook.
Operating Loss
Navitas reported an operating loss of $11.8 million for the first quarter of 2025, although this was an improvement from the previous quarter. The reduction in operating loss indicates some progress in managing expenses.
Forward-Looking Guidance
Looking ahead, Navitas Semiconductor is navigating headwinds due to a slowdown in channel inventory within the EV, solar, and industrial sectors. Despite these challenges, the company anticipates robust growth in 2026, driven by significant market and product developments. The introduction of the bidirectional GaN IC and automotive qualification for GaNSafe technology are expected to play pivotal roles in future success. Additionally, Navitas projects a slight improvement in gross margin to 38.5% and a decrease in operating expenses to $15.5 million in the second quarter.
In summary, Navitas Semiconductor’s earnings call painted a complex picture, balancing promising technological advancements and strategic initiatives with current financial challenges. While the company faces ongoing revenue and margin pressures, its strong pipeline and innovative projects offer hope for future growth. Investors and market watchers will be keenly observing how Navitas navigates these challenges and capitalizes on its technological breakthroughs.