Nordic Semiconductor (NOD) CMD 2024 summary

Strategic direction and organizational transformation

• Launched Nordic 2.0 to sharpen strategic focus, enhance engineering execution, and strengthen accountability, establishing four autonomous business units: Short Range, Long Range, Wi-Fi, and PMIC, each with clear mandates and leadership to drive growth and restore profitability.

• Product roadmaps have been realigned to accelerate time-to-market, improve ROI, and better match customer needs, with increased accountability and autonomy in teams.

• Dual go-to-market approach targets both key global customers and the broad market, aiming to revitalize broad market sales and expand the customer base.

• Investments in supply chain resilience, dual sourcing on 22nm nodes, and partnerships with TSMC and Global Foundries support future growth and supply security.

• Commitment to sustainability, with validated greenhouse gas targets and recognition as a top sustainable company.

Product innovation and market opportunities

• Launch of the nRF54 Series (L and H) marks a new era, offering >2x processing power, improved energy efficiency, and security, with first commercial shipments starting now and 2-4 new product families planned annually.

• The nRF54 Series is expected to drive accelerated growth from 2026, with early revenues in 2025 and a broad product rollout planned.

• Long Range Business targets profitability by 2028, focusing on asset tracking, metering, and industrial IoT, with the nRF9151 and future nRF92 Series as key drivers and a goal to reach >USD 100m revenue.

• Wi-Fi and PMIC units aim for >USD 50m revenue and profitability by 2028, leveraging ultra-low power technology and integration with other products.

• Edge AI and machine learning capabilities are being embedded in new products, enabling smarter, battery-efficient devices for healthcare, consumer, and industrial markets.

Financial guidance and targets

• Group targets are set for over 20% average annual growth through the decade and ~25% EBITDA margin within five years.

• Short-term guidance for Q3'24 revenue is USD 150-170m, up 11%-26% y/y, with seasonal decline expected in Q4'24.

• Gross margin target remains above 50%, supported by the transition to 22nm technology and a diversified customer base.

• R&D spending targeted at 15-20% of revenue, with SG&A below 10% and cost containment a priority despite inflation and new product launches.

• Profitability in Scale-up (Long Range) and Early-stage (Wi-Fi, PMIC) businesses targeted for 2028, with Short Range aiming for 25% EBITDA margin by 2027.