Napatech (NAPA) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue reached $3.4 million (DKK 23.8 million), up 8% year-over-year, with a gross margin of 70.3% within guidance.

• Growth driven by significant design wins with d-Matrix, Intel Altera, Broadcom Symantec, Eideticom, Celera, and Xelera, expanding into AI, cybersecurity, and financial services.

• Partnerships with Intel Altera and other tech leaders enable access to advanced technologies, mass market opportunities, and scalable growth.

• Shift to order-based manufacturing and improved payment terms to enhance inventory management and working capital.

• Announced a capital increase of at least NOK 150 million, with pre-commitments above that amount.

Financial highlights

• Q1 2025 revenue: DKK 23.8 million, up 11% year-over-year; gross margin: 70.3%, within guidance.

• EBITDA: -DKK 29.1 million; EBIT: -DKK 35.5 million; EBITDAC: -DKK 32.1 million.

• Free cash flow: -DKK 29.4 million; net cash flow from operating activities: -DKK 25.7 million.

• Cash and cash equivalents: DKK 34.6 million at Q1 end, up from DKK 27.5 million year-over-year.

• Staff costs increased 26% year-over-year due to development staff expansion.

Outlook and guidance

• Q2 2025 revenue expected to increase 40%-50% over Q2 2024.

• 2025 revenue guidance: DKK 150–190 million; gross margin: 69–71%.

• Anticipates doubling unit sales in 2026 and further significant growth in 2027, driven by d-Matrix and other design wins.

• Expects to maintain strong margins and keep OpEx stable or reduced at 2025 levels.

• Working capital expected to decrease due to order-based production and improved payment terms.