Vicor (VICR) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue was $85.9M, up 2.4% sequentially but down 19.6% year-over-year; net loss was $1.2M, or $(0.03) per diluted share.

• Backlog at quarter-end was $153.8M, up 2.3% sequentially but down 29.2% year-over-year; book-to-bill ratio exceeded 1 for the first time in eight quarters.

• Advanced Products revenue was $46.4M, up 7.1% sequentially but down 31.3% year-over-year; Brick Products revenue was $39.5M, down 2.7% sequentially and flat year-over-year.

• Cash and cash equivalents at quarter end were $251.9M, up 5.3% sequentially.

• Net loss margin was (1.4)% in Q2 2024, compared to net income margin of 16.0% a year ago.

Financial highlights

• Gross margin was $42.8M (49.8% of revenue), down from $55.2M (51.7%) a year ago and $45.1M (53.8%) last quarter, mainly due to product mix shift and lower-margin legacy HPC shipments.

• Operating expenses were $42.6M, down 30.5% sequentially but up from $37.3M year-over-year, mainly from reduced legal fees.

• Cash flow from operations was $15.6M, down from $19.0M year-over-year, but up from $2.6M sequentially; capex was $6.1M.

• Inventory decreased 2.9% sequentially to $109.1M; annualized inventory turns were 1.7.

• Working capital at June 30, 2024 was $367.5M; current ratio was 6.4:1.

Outlook and guidance

• Management did not provide quarterly guidance due to ongoing uncertainties and a wide range of possible outcomes.

• Gen 5 product sampling to customers is on track for late August, with broader releases expected in Q4 and beyond.

• Company expects continued revenue concentration among fewer, larger customers and ongoing market softness in underpenetrated segments.

• Ongoing supply chain and production constraints, especially for Advanced Products, may impact future results.

• Company believes cash and equivalents are sufficient for operational and capital needs in the short and long term.