Skywater Technology, Inc. · NASDAQ:SKYT
Skywater Technology — Q2 2024 Earnings Presentation
22 slides from Skywater Technology's earnings presentation, Aug 7, 2024
Slide 1: Q2 Earnings
Q2 Earnings AUGUST 7, 2024 ©2024 All Rights Reserved. Proprietary.
Slide 2: SkyWater Technology Forward-Looking Statements
SkyWater Technology Forward-Looking Statements This presentation and the accompanying oral presentation, including answers to questions, contains “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements that are based on the Compan
Slide 3: Q2 2024 Results Overview
Q2 2024 Results Overview • Record revenue of $93.3 million ◦ ATS development revenue reached a new record of $61.7 million ▪ Up 1% from Q1 2024 and up 18% compared to Q2 2023 ▪ Sequential growth driven by continued strength in aerospace and defense, which exceeded expectations due to pull-ins of dem
Slide 4: Recent Business Highlights
Recent Business Highlights • Advanced Technology Service (ATS) development revenue exceeded expectations to reach a new record in Q2, reflecting strong operational execution and improved cycle times in response to accelerated demand on multiple aerospace and defense programs. • Record revenue result
Slide 5: TaaS: Concept to Production Services
TaaS: Concept to Production Services CONCEPT & Advanced Technology FEASIBILITY Services (ATS) TECHNOLOGY DEMONSTRATION Wafer PROCESS Services DEVELOPMENT DEVICE DESIGN Technology as a Service: ✔ Efficient R&D DEVICE ✔ Accelerated Time-to-Market QUALIFICATION ✔ Volume Manufacturing VOLUME MANUFACTURI
Slide 6: Macro Trends Driving SkyWater's Business
Macro Trends Driving SkyWater’s Business AEROSPACE & DEFENSE MARKET COMMERCIAL MARKETS • Rising semiconductor content • More than Moore innovation • Onshore supply • Next-gen Biomed, Advanced Compute, Industrial 6 ©2024 All Rights Reserved. Proprietary.
Slide 7: Benefits of Customer-Funded CapEx Model
Benefits of Customer-Funded CapEx Model CO-INVESTMENT YIELDS MULTIPLE BENEFITS MULTI-YEAR PERIOD OF ELEVATED CO-INVESTMENT • Creates high-value and unique capabilities Customer Funded Tooling ◦ State-of-the-art 200mm lithography Tool funding incorporated in contract awards $ 76 through 2023 Tools re
Slide 8: Q2 2024 Financial Review
Q2 Earnings Q2 2024 Financial Review ©2024 All Rights Reserved. Proprietary.
Slide 9: Revenue Summary
Revenue Summary $'s in USD millions Q2 2024 Q1 2024 Q/Q Q2 2023 Y/Y ATS Development Revenue $61.7 $61.2 1% $52.1 18% Wafer Services Revenue $5.8 $10.0 (42)% $16.8 (66)% Tools Revenue $25.9 $8.5 206% $0.9 nm Total Revenue $93.3 $79.6 17% $69.8 34% nm - not meaningful • Record ATS Development revenue
Slide 10: Gross Margin Summary
Gross Margin Summary $'s in USD millions Q2 2024 Q1 2024 Q/Q Q2 2023 Y/Y GAAP Gross Profit $17.1 $13.0 32% $16.7 3% GAAP Gross Margin 18.3% 16.3% 200 bps 23.9% (560) bps Adjustments: Equity-Based Compensation $0.5 $0.5 11% $0.3 73% Management Transition Expense $— $— nm $0.7 nm Non-GAAP Gross Profit
Slide 11: Adjusted EBITDA Summary
Adjusted EBITDA Summary $'s in USD millions Q2 2024 Q1 2024 Q/Q Q2 2023 Y/Y Net Loss $(1.9) $(5.7) 67% $(8.6) 78% Interest Expense $2.5 $2.4 4% $3.0 (16)% Income Tax (Benefit) $(0.1) $— nm $— nm Depreciation and amortization $4.1 $5.1 (20)% $7.2 (44)% EBITDA $4.5 $1.8 156% $1.6 184% Adjusted EBITDA
Slide 12: Revenue Trend
Revenue Trend Q2 2024 Results Demonstrate Continued ATS Strength and Record Customer Co-Investment in USD $ millions $93.3 $286.7 $79.2 $79.6 $69.8 $71.6 $66.1 $212.9 $65.1 $52.3 $48.1 $47.4 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 2022 2023 ATS development rev
Slide 13: Adjusted EBITDA and Non-GAAP Net Income (Loss)
Adjusted EBITDA and Non-GAAP Net Income (Loss) Profitable Results for Q2 a Result of Record Revenues for ATS + Wafer Services and Cost Controls $37.2 $10.3 $10.3 $10.6 $8.1 $8.1 $4.8 $4.9 $3.8 $7.7 $0.8 $(1.5) $(1.1) $(1.6) $(2.0) $(2.4) $(2.2) $(7.7) $(3.7) $(4.8) $(5.1) $(10.7) $(30.3) $(13.0) Q1
Slide 14: Business Outlook
Business Outlook Revenue growth expectations for the full year are largely unchanged since our May earnings call • We continue to expect ATS development growth in the range of 10% to 20% over 2023 • Tools revenue expected to increase to approximately $80M in 2024 • Wafer Services revenue expected to
Slide 15: GAAP to Non-GAAP Reconciliation
Q2 Earnings GAAP to Non-GAAP Reconciliation ©2024 All Rights Reserved. Proprietary.
Slide 16: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation We provide supplemental, non-GAAP financial information that our management regularly evaluates to provide additional insight to investors as supplemental information to our results reported using U.S. generally accepted accounting principles (GAAP). We provide non-GA
Slide 17: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Q1 Q2 Q3 Q4 2022 Q1 Q2 Q3 Q4 2023 Q1 Q2 GAAP revenue $ 48,121 $ 47,407 $ 52,326 $ 65,087 $212,941 $ 66,094 $ 69,811 $ 71,624 $ 79,154 $286,682 $ 79,636 $ 93,329 GAAP cost of revenue $ 49,061 $ 45,327 $ 44,049 $ 48,536 $186,973 $ 49,626 $ 53,144 $ 57,477 $ 67,143 $227,
Slide 18: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Q1 Q2 Q3 Q4 2022 Q1 Q2 Q3 Q4 2023 Q1 Q2 GAAP selling, general and administrative expense $ 11,690 $ 10,795 $ 10,778 $ 13,040 $ 46,303 $ 14,895 $ 17,820 $ 16,105 $ 15,092 $ 63,911 $ 11,169 $ 12,332 Equity-based compensation (1,866) (1,444) (1,128) (995) (5,433) (1,178)
Slide 19: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Q1 Q2 Q3 Q4 2022 Q1 Q2 Q3 Q4 2023 Q1 Q2 Equity-based compensation allocation in the consolidated statements of operations: Cost of revenue $ 1,125 $ 546 $ 456 $ 452 $ 2,578 $ 513 $ 291 $ 438 $ 313 $ 1,555 $ 455 $ 504 Research and development expense 225 128 115 126 59
Slide 20: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Q1 Q2 Q3 Q4 2022 Q1 Q2 Q3 Q4 2023 Q1 Q2 Net loss to shareholders $ (16,606) $ (13,005) $ (6,939) $ (3,041) $ (39,593) $ (4,273) $ (8,590) $ (7,568) $ (10,325) $ (30,756) $ (5,729) $ (1,897) Interest expense 1,029 1,040 1,331 2,895 6,295 2,471 2,950 2,507 2,898 10,826
Slide 21: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Q1 Q2 Q3 Q4 2022 Q1 Q2 Q3 Q4 2023 Q1 Q2 GAAP EPS Numerator: Net loss attributable to SkyWater Technology, Inc. $ (16,606) $ (13,005) $ (6,939) $ (3,041) $ (39,593) $ (4,273) $ (8,590) $ (7,568) $ (10,325) $ (30,756) $ (5,729) $ (1,897) Denominator: Weighted-average co
Slide 22: Q2 Earnings
Q2 Earnings ©2024 All Rights Reserved. Proprietary.