Lattice Semiconductor (LSCC) investor relations material

Executive summary

• Q2 2025 revenue reached $124M, up 3.2% sequentially and nearly flat year-over-year, with record design wins and broad-based growth across key metrics.

• Communications and computing markets showed robust 20% sequential and 26% year-over-year growth, while industrial and automotive segments declined but are expected to recover as inventory normalizes.

• Net income dropped to $2.91M from $22.63M year-over-year due to higher operating expenses and lower demand in some markets.

• Achieved major design wins in AI accelerators, robotics, and edge AI, and expanded collaborations, including with Mitsubishi Electric.

• Continued focus on innovation, customer engagement, and executing long-term strategy, with optimism for market recovery and growth.

Financial highlights

• Q2 2025 revenue was $123.97M–$124M, up 3.2% sequentially and nearly flat year-over-year.

• Non-GAAP gross margin was 69.3%; GAAP gross margin was 68.4%.

• Adjusted EBITDA margin was 34.1%, with adjusted EBITDA of $42.2M.

• Non-GAAP EPS was $0.24, up from $0.22 in Q1; GAAP net income margin was 2.3%.

• Free cash flow margin improved to 25.2% in Q2 2025.

Outlook and guidance

• Q3 2025 revenue expected between $128M and $138M, with non-GAAP gross margin at 69.5% ±1%.

• Non-GAAP EPS guidance for Q3 is $0.26–$0.30 per share.

• Channel inventory for communications and compute normalized; industrial and automotive expected to normalize by year-end.

• Strong bookings and backlog extend into Q4 and Q1 2026, supporting a positive growth outlook.

• 2026 revenue growth target of 15–20% reaffirmed, with AI-related revenue and new products expected to drive growth.