SkyWater Technology Reports First Quarter 2024 Results

Q1 2024 Results:

  • Revenue: Revenue of $79.6 million increased 20% year-over-year. ATS development revenue of $61.2 million increased 28% year-over-year. Tools revenue was $8.5 million in the first quarter of 2024 compared to $0.5 million in the first quarter of 2023. Wafer Services revenue of $10.0 million decreased 44% compared to the first quarter of 2023.
  • Gross Profit: GAAP gross profit was $13.0 million, or 16.3% of total revenue, compared to gross profit of $16.5 million, or 24.9% of total revenue, in the first quarter of 2023. Non-GAAP gross profit was $13.4 million, or 16.9% of total revenue, compared to non-GAAP gross profit of $17.0 million, or 25.7% of total revenue, in the first quarter of 2023. Cost of revenue for the first quarter of 2024 included an approximately $8 million accrual reflecting the anticipated additional costs for us to complete certain development milestones for a significant aerospace and defense program.
  • Operating Expenses: GAAP operating expenses were $15.2 million, compared to $17.6 million in the first quarter of 2023. The first quarter of 2023 included $2.2 million of credit losses that did not repeat in the first quarter of 2024.
  • Net Loss: The GAAP net loss to shareholders was $5.7 million, or $0.12 per share, compared to a net loss to shareholders of $4.3 million, or $0.10 per share, in the first quarter of 2023. The Non-GAAP net loss to shareholders was $3.7 million, or $0.08 per share, compared to a non-GAAP net loss to shareholders of $2.4 million, or $0.06 per share, in the first quarter of 2023.
  • Adjusted EBITDA: Adjusted EBITDA was $4.9 million, or 6.2% of total revenue, compared to $8.1 million, or 12.3% of total revenue, in the first quarter of 2023.

A reconciliation between historical GAAP and non-GAAP information is contained in the tables below in the section titled “Non-GAAP Financial Measures.”

Investor Webcast

SkyWater will host a conference call on Wednesday, May 8, 2024, at 3:30 p.m. CT to discuss its first quarter 2024 financial results. A live webcast of the call will be available online at IR.SkyWaterTechnology.com.

About SkyWater Technology

SkyWater (NASDAQ: SKYT) is a U.S.-based semiconductor manufacturer and a DMEA-accredited Category 1A Trusted Foundry. SkyWater’s Technology as a Service model streamlines the path to production for customers with development services, volume production and heterogeneous integration solutions in its world-class U.S. facilities. This pioneering model enables innovators to co-create the next wave of technology with diverse categories including mixed-signal CMOS, read-out ICs, rad-hard ICs, power management, MEMS, superconducting ICs, photonics, carbon nanotubes, and interposers. SkyWater serves growing markets including aerospace & defense, automotive, biomedical, cloud & computing, consumer, industrial and IoT. For more information, visit: www.skywatertechnology.com.

Cautionary Statement Regarding Preliminary Results

The Company’s results for the first quarter ended March 31, 2024 are preliminary, unaudited and subject to the finalization of the Company’s first quarter review and full-year audit and should not be viewed as a substitute for full financial statements prepared in accordance with GAAP. The Company cautions that actual results may differ materially from those described in this press release.

SkyWater Technology Forward-Looking Statements

This press release contains “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements that are based on the Company’s current expectations or forecasts of future events, rather than past events and outcomes, and such statements are not guarantees of future performance. Forward-looking statements include all statements other than statements of historical fact contained in this presentation, including information or predictions concerning the Company’s future business, results of operations, financial performance, plans and objectives, competitive position, market trends, and potential growth and market opportunities. In some cases, you can identify forward-looking statements by words such as “intends,” “estimates,” “predicts,” “potential,” “continues,” “anticipates,” “plans,” “expects,” “believes,” “should,” “could,” “may,” “will,” “targets,” “projects,” “seeks” or the negative of these terms or other comparable terminology.

Forward-looking statements are subject to risks, uncertainties and assumptions, which may cause the Company’s actual results, performance or achievements to be materially different from those expressed or implied by such forward-looking statements. Key factors that could cause the Company’s actual results to be different than expected or anticipated include, but are not limited to: our goals and strategies; our future business development, financial condition and results of operations; our ability to continue operating our fabrication facilities at full capacity; our ability to appropriately respond to changing technologies on a timely and cost-effective basis; our customer relationships and our ability to retain and expand our customer relationships; our ability to accurately predict our future revenues for the purpose of appropriately budgeting and adjusting our expenses; our expectations regarding dependence on our largest customers; our ability to diversify our customer base and develop relationships in new markets; the performance and reliability of our third-party suppliers and manufacturers; our ability to procure tools, materials, and chemicals; our ability to control costs, including our operating and capital expenses; the size and growth potential of the markets for our solutions, and our ability to serve and expand our presence in those markets; the level of demand in our customers’ end markets; our ability to attract, train and retain key qualified personnel in a competitive labor market; adverse litigation judgments, settlements or other litigation-related costs; changes in trade policies, including the imposition of tariffs; our ability to raise additional capital or financing; our ability to accurately forecast demand; the level and timing of U.S. government program funding; our ability to maintain compliance with certain U.S. government contracting requirements; regulatory developments in the United States and foreign countries; our ability to protect our intellectual property rights; our ability to meet our long-term growth targets; and other factors discussed in the “Risk Factors” section of the annual report on Form 10-K the Company filed with the SEC on March 15, 2024 and in other documents that the Company files with the SEC, which are available at http://www.sec.gov. The Company assumes no obligation to update any forward-looking statements, which speak only as of the date of this press release.

SKYWATER TECHNOLOGY, INC.

Condensed Consolidated Balance Sheets

(Unaudited)

 

 

March 31, 2024

 

December 31, 2023

 

 

 

 

 

(in thousands, except share data)

Assets

 

 

 

Current assets

 

 

 

Cash and cash equivalents

$

20,002

 

 

$

18,382

 

Accounts receivable (net of allowance for credit losses of $96 and $180, respectively)

 

57,895

 

 

 

65,961

 

Contract assets (net of allowance for credit losses of $62 and $99, respectively)

 

24,922

 

 

 

29,666

 

Inventory

 

15,558

 

 

 

15,341

 

Prepaid expenses and other current assets

 

24,528

 

 

 

16,853

 

Income tax receivable

 

82

 

 

 

172

 

Total current assets

 

142,987

 

 

 

146,375

 

Property and equipment, net

 

157,281

 

 

 

159,367

 

Intangible assets, net

 

6,320

 

 

 

5,672

 

Other assets

 

5,693

 

 

 

5,342

 

Total assets

$

312,281

 

 

$

316,756

 

Liabilities and shareholders’ equity

 

 

 

Current liabilities

 

 

 

Current portion of long-term debt

$

3,631

 

 

$

3,976

 

Accounts payable

 

25,919

 

 

 

19,614

 

Accrued expenses

 

30,512

 

 

 

48,291

 

Short-term financing, net of unamortized debt issuance costs

 

32,612

 

 

 

22,765

 

Contract liabilities

 

56,109

 

 

 

49,551

 

Total current liabilities

 

148,783

 

 

 

144,197

 

Long-term liabilities

 

 

 

Long-term debt, less current portion and net of unamortized debt issuance costs

 

35,665

 

 

 

36,098

 

Long-term contract liabilities

 

58,605

 

 

 

65,754

 

Deferred income tax liability, net

 

623

 

 

 

679

 

Other long-term liabilities

 

9,204

 

 

 

9,327

 

Total long-term liabilities

 

104,097

 

 

 

111,858

 

Total liabilities

 

252,880

 

 

 

256,055

 

Shareholders’ equity

 

 

 

Preferred stock, $0.01 par value per share (80,000,000 shares authorized, zero shares issued and outstanding as of March 31, 2024 and December 31, 2023)

 

 

 

 

 

Common stock, $0.01 par value per share (200,000,000 shares authorized; 47,338,069 and 47,028,159 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively)

 

473

 

 

 

470

 

Additional paid-in capital

 

181,802

 

 

 

178,473

 

Accumulated deficit

 

(130,932

)

 

 

(125,203

)

Total shareholders’ equity, SkyWater Technology, Inc.

 

51,343

 

 

 

53,740

 

Noncontrolling interests

 

8,058

 

 

 

6,961

 

Total shareholders’ equity

 

59,401

 

 

 

60,701

 

Total liabilities and shareholders’ equity

$

312,281

 

 

$

316,756

 

SKYWATER TECHNOLOGY, INC.

Condensed Consolidated Statements of Operations

(Unaudited)

 

 

Three-Month Period Ended

 

March 31, 2024

 

December 31, 2023

 

April 2, 2023

 

 

 

 

 

 

 

(in thousands, except share data)

Revenue

$

79,636

 

 

$

79,154

 

 

$

66,094

 

Cost of revenue

 

66,656

 

 

 

67,143

 

 

 

49,626

 

Gross profit

 

12,980

 

 

 

12,011

 

 

 

16,468

 

Research and development expense

 

4,012

 

 

 

2,872

 

 

 

2,668

 

Selling, general, and administrative expense

 

11,169

 

 

 

15,092

 

 

 

14,895

 

Operating loss

 

(2,201

)

 

 

(5,953

)

 

 

(1,095

)

Interest expense

 

(2,390

)

 

 

(2,898

)

 

 

(2,471

)

Loss before income taxes

 

(4,591

)

 

 

(8,851

)

 

 

(3,566

)

Income tax expense (benefit)

 

41

 

 

 

(450

)

 

 

 

Net loss

 

(4,632

)

 

 

(8,401

)

 

 

(3,566

)

Less: net income attributable to noncontrolling interests

 

1,097

 

 

 

1,924

 

 

 

707

 

Net loss attributable to SkyWater Technology, Inc.

$

(5,729

)

 

$

(10,325

)

 

$

(4,273

)

Net loss per share attributable to common shareholders, basic and diluted

$

(0.12

)

 

$

(0.22

)

 

$

(0.10

)

Weighted average shares used in computing net loss per common share, basic and diluted

 

47,098,519

 

 

 

47,020,395

 

 

 

43,817,417

 

SKYWATER TECHNOLOGY, INC.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

 

 

Three-Month Period Ended

 

March 31, 2024

 

April 2, 2023

 

 

 

 

 

(in thousands)

Cash flows from operating activities

 

 

 

Net loss

$

(4,632

)

 

$

(3,566

)

Adjustments to reconcile net loss to net cash flows used in operating activities

 

 

 

Depreciation and amortization

 

5,065

 

 

 

7,352

 

Amortization of debt issuance costs included in interest expense

 

440

 

 

 

357

 

Long-term incentive and equity-based compensation

 

2,072

 

 

 

1,853

 

Deferred income taxes

 

(56

)

 

 

 

Provision for credit losses

 

(121

)

 

 

2,154

 

Changes in operating assets and liabilities

 

 

 

Accounts receivable and contract assets

 

12,933

 

 

 

(6,875

)

Inventories

 

(217

)

 

 

(969

)

Prepaid expenses and other assets

 

(8,025

)

 

 

(2,653

)

Accounts payable and accrued expenses

 

(10,883

)

 

 

(3,494

)

Contract liabilities, current and long-term

 

(590

)

 

 

(5,245

)

Income tax receivable and payable

 

90

 

 

 

 

Net cash used in operating activities

 

(3,924

)

 

 

(11,086

)

Cash flows from investing activities

 

 

 

Purchase of software and licenses

 

(811

)

 

 

(213

)

Purchases of property and equipment

 

(1,259

)

 

 

(2,851

)

Net cash used in investing activities

 

(2,070

)

 

 

(3,064

)

Cash flows from financing activities

 

 

 

Draws on revolving line of credit

 

90,500

 

 

 

59,350

 

Paydowns of revolving line of credit

 

(81,930

)

 

 

(63,310

)

Proceeds from tool financings

 

920

 

 

 

494

 

Principal payments on long-term debt

 

(862

)

 

 

(317

)

Cash paid for principal on finance leases

 

(274

)

 

 

(343

)

Proceeds from the issuance of common stock pursuant to equity compensation plans

 

1,260

 

 

 

1,275

 

Proceeds from the issuance of common stock under the ATM

 

 

 

 

2,696

 

Cash paid on licensed technology obligations

 

(2,000

)

 

 

(1,850

)

Net distributions to noncontrolling interest

 

 

 

 

(30

)

Net cash provided by (used in) financing activities

 

7,614

 

 

 

(2,035

)

Net increase (decrease) in cash and cash equivalents

 

1,620

 

 

 

(16,185

)

Cash and cash equivalents - beginning of period

 

18,382

 

 

 

30,025

 

Cash and cash equivalents - end of period

$

20,002

 

 

$

13,840

 

Supplemental Financial Information by Quarter

 

 

Q1 2024

 

Q4 2023

 

Q3 2023

 

Q2 2023

 

Q1 2023

 

 

 

 

 

 

 

 

 

 

 

(in thousands)

ATS development revenue (1)

$

61,185

 

$

57,170

 

$

53,891

 

$

52,073

 

$

47,770

Tools revenue (2)

 

8,459

 

 

9,936

 

 

3,243

 

 

936

 

 

536

Wafer Services revenue

 

9,992

 

 

12,048

 

 

14,490

 

 

16,802

 

 

17,788

Total revenue

$

79,636

 

$

79,154

 

$

71,624

 

$

69,811

 

$

66,094

 

 

 

 

 

 

 

 

 

 

Tools revenue (2)

$

8,459

 

$

9,936

 

$

3,243

 

$

936

 

$

536

Cost of tools revenue (2)

 

8,260

 

 

9,125

 

 

2,861

 

 

290

 

 

484

Tools gross profit (loss)

$

199

 

$

811

 

$

382

 

$

646

 

$

52

 

 

 

 

 

 

 

 

 

 

Revenue impact of modified customer contracts

$

 

$

 

$

 

$

3,601

 

$

Cost of revenue impact of modified customer contracts

 

 

 

 

 

 

 

 

 

Gross profit (loss) impact of modified customer contracts

$

 

$

 

$

 

$

3,601

 

$

__________________

(1)

ATS development revenue represents GAAP revenue primarily derived from process development services, tool installation and qualification services, facility and tool access, and security services.

(2)

Tools revenue and cost of tools revenue primarily represent GAAP amounts that arise from the procurement and subsequent sale of equipment to our customers. This equipment is used to complete ATS customer programs.


« Previous Page 1 | 2 | 3 | 4  Next Page »



© 2024 Internet Business Systems, Inc.
670 Aberdeen Way, Milpitas, CA 95035
+1 (408) 882-6554 — Contact Us
ShareCG™ is a trademark of Internet Business Systems, Inc.

Report a Bug Report Abuse Make a Suggestion About Privacy Policy Contact Us User Agreement Advertise