Skywater Technology, Inc. · NASDAQ:SKYT
Skywater Technology — Q3 2024 Earnings Presentation
22 slides from Skywater Technology's earnings presentation, Nov 7, 2024
Slide 1: Q3 Earnings
Q3 Earnings NOVEMBER 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 SkyWater T
Slide 3: Q3 2024 Results Overview
Q3 2024 Results Overview • Record revenue of $93.8 million ◦ ATS development revenue of $56.4 million ▪ Sequential decline of (9)% from Q2 2024 and increase of 5% compared to Q3 2023 ▪ Impacted by funding limitations at end of government fiscal year ◦ Wafer Services revenue of $6.7 million ▪ Stronge
Slide 4: Recent Business Highlights
Recent Business Highlights • Achieved 9th straight record revenue quarter driven by over $30 million in customer-funded CapEx investments. This unprecedented level of investment by our customers is expected to significantly bolster our capabilities and capacity in both Minnesota and Florida, enablin
Slide 5: TaaS: Concept to Production Services
TaaS: Concept to Production Services Advanced Technology CONCEPT & FEASIBILITY Services (ATS) TECHNOLOGY DEMONSTRATION Wafer Services PROCESS 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 Tool funding incorporated in contract awards through 2023 $ 76 ◦ State-of-the-art 200mm lithography Tools re
Slide 8: Q3 2024 Financial Review
Q3 Earnings Q3 2024 Financial Review ©2024 All Rights Reserved. Proprietary.
Slide 9: Revenue Summary
Revenue Summary $'s in USD millions Q3 2024 Q2 2024 Q/Q * Q3 2023 Y/Y * ATS development revenue $56.4 $61.7 (9)% $53.9 5% Wafer Services revenue $6.7 $5.8 16% $14.5 (54)% Combined ATS development and Wafer Services revenue * $63.1 $67.4 (6)% $68.4 (8)% Tools revenue $30.7 $25.9 19% $3.2 847% Total r
Slide 10: Gross Margin Summary
Gross Margin Summary $'s in USD millions Q3 2024 Q2 2024 Q/Q * Q3 2023 Y/Y * GAAP gross profit $20.2 $17.1 18% $14.1 43% GAAP gross margin * 21.6% 18.3% 330 bps 19.8% 180 bps Adjustments: Equity-based compensation $0.6 $0.5 12% $0.4 29% Management transition expense $0.1 $— nm $— nm Non-GAAP gross p
Slide 11: Adjusted EBITDA Summary
Adjusted EBITDA Summary $'s in USD millions Q3 2024 Q2 2024 Q/Q * Q3 2023 Y/Y * Net Income (Loss) $1.5 $(1.9) (179)% $(7.6) (120)% Net income (loss) as a percentage of total revenue * 1.6% (2.0)% 360 bps (10.6)% 1,220 bps Interest expense $2.0 $2.5 (20)% $2.5 (21)% Income tax (benefit) expense $0.1
Slide 12: Revenue Trend
Revenue Trend Q3 2024 Results Demonstrate Record Tools Revenue (Customer-Funded CapEx Investments) in USD $ millions * Q4 2022 and Q2 2023 ATS development revenue excludes impact of modified customer contracts † Q1 2022 wafer services revenue excludes impact of modified customer contracts 12 ©2024 A
Slide 13: Adjusted EBITDA and Non-GAAP Net Income (Loss)
Adjusted EBITDA and Non-GAAP Net Income (Loss) 9th Straight Quarter of Record Revenue and Positive Adjusted EBITDA 13 ©2024 All Rights Reserved. Proprietary.
Slide 14: Business Outlook
Business Outlook Q4 expectations indicate continued strength in full year outlook • Total revenue in the range of $72 - $76 million • ATS development revenue of $58 - $61 million • Wafer Services revenue of $3 - $4 million • Tools revenue of $11 million • Non-GAAP EPS of $(0.10) to $(0.04) As we loo
Slide 15: GAAP to Non-GAAP Reconciliation
Q3 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 Q3 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 $ 93,817 GAAP cost of revenue $ 49,061 $ 45,327 $ 44,049 $ 48,536 $186,973 $ 49,626 $ 53,144 $ 57,477 $
Slide 18: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Q1 Q2 Q3 Q4 2022 Q1 Q2 Q3 Q4 2023 Q1 Q2 Q3 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 $ 12,095 Equity-based compensation expense (1,866) (1,444) (1,128) (
Slide 19: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Q1 Q2 Q3 Q4 2022 Q1 Q2 Q3 Q4 2023 Q1 Q2 Q3 Equity-based compensation expense 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 $ 565 Research and development expense 2
Slide 20: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Q1 Q2 Q3 Q4 2022 Q1 Q2 Q3 Q4 2023 Q1 Q2 Q3 Net income (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) $ 1,512 Interest expense 1,029 1,040 1,331 2,895 6,295 2,471 2,950
Slide 21: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Q1 Q2 Q3 Q4 2022 Q1 Q2 Q3 Q4 2023 Q1 Q2 Q3 GAAP EPS Numerator: Net income (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) $ 1,512 Denominator:
Slide 22: Q3 Earnings
Q3 Earnings ©2024 All Rights Reserved. Proprietary.