8-K: Silvaco Announces Record Fourth Quarter and Full-Year 2024 Preliminary Results

Silvaco Group, Inc. reports record fourth quarter and full-year 2024 preliminary unaudited results, driven by strong bookings and revenue growth.

Summary

• Silvaco Group, Inc. announced preliminary unaudited financial results for Q4 and full-year 2024.
• The company expects record fourth quarter bookings between $20.1 and $20.4 million, a 29% to 31% year-over-year increase.
• Fourth quarter revenue is expected to range between $17.7 and $18.1 million, up 41% to 45% year-over-year.
• Silvaco acquired 13 new customers in Q4 2024.
• The company anticipates a GAAP gross margin of 85% to 87% and a non-GAAP gross margin of 88% to 90% for the fourth quarter.
• Full-year 2024 bookings are expected to be between $65.5 million and $65.9 million, a 13% increase compared to 2023.
• Full-year revenue is expected to be between $59.5 million and $59.9 million, a 10% increase year-over-year.
• The company acquired 46 new customers in 2024.
• GAAP gross margin for the full year is anticipated to be in the range of 79% to 81%, while non-GAAP gross margin is expected to be in the range of 85% to 87%.

Sentiment

Score: 8

Explanation: The document presents a positive outlook with record bookings and revenue, improved gross margins, and strategic partnerships. While it acknowledges risks and uncertainties, the overall tone is optimistic and suggests strong performance.

Positives

• Silvaco achieved record bookings and revenue for both the fourth quarter and full year of 2024.
• The company experienced significant year-over-year revenue growth in the United States, China, and Japan.
• Silvaco expanded its customer base by acquiring 13 new customers in Q4 and 46 new customers throughout 2024.
• The company achieved ISO 9001 certification, demonstrating a commitment to quality.
• The Ninth Circuit Court of Appeals affirmed the dismissal of all claims against Silvaco brought by Aldini AG.
• A ruling in favor of Silvaco denied a motion for prejudgment interest in the Nangate Denmark ApS litigation.
• Non-GAAP gross margin showed significant improvement from 79% in Q4 2023 to an anticipated 88% to 90% in Q4 2024.

Negatives

• GAAP operating income (loss) is anticipated in the range of ($40.4) million and ($39.6) million, compared to $1.1 million in 2023.
• GAAP net income (loss) per share is anticipated in the range of ($1.49) and ($1.55) compared to ($0.02) in 2023.

Risks

• The preliminary results are unaudited and subject to change upon completion of the company's financial reporting process.
• The company's forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from expectations, including market conditions, competition, and regulatory developments.
• The company's statements regarding record bookings and revenue reflect management's assessment of historical financial data and are based on the best information available, but should not be construed as definitive due to the absence of consistently audited financial records prior to 2019.

Future Outlook

Silvaco anticipates further growth in 2025, driven by sustained demand for its digital twin modeling platform and growth in key semiconductor markets.

Management Comments

• We closed 2024 with record results for bookings and revenue, driven by sustained demand for our digital twin modeling platform and growth in key semiconductor markets, said Dr. Babak Taheri, CEO of Silvaco.
• Our strategic focus on innovation and execution continues to deliver value for our customers and stakeholders, setting the stage for further growth in 2025.
• I am proud of our ability to execute and close the year on a high note, Dr. Taheri added.
• The record-breaking results, coupled with strong non-GAAP gross margin performance, demonstrate the resilience of our business model and the trust our customers place in Silvacos solutions.
• We are confident in our ability to build on this momentum in the year ahead.

Industry Context

Silvaco's participation in the SMART USA Institute under the CHIPS Manufacturing USA program highlights its commitment to advancing digital twin technologies in semiconductor manufacturing, aligning with broader industry efforts to enhance semiconductor innovation and competitiveness.

Comparison to Industry Standards

• Comparing Silvaco's growth to industry peers like Synopsys, Cadence, and Mentor Graphics (now Siemens EDA) is difficult without specific growth rates for those companies for the same period.
• However, the reported revenue growth of 41% to 45% for Q4 2024 suggests a strong performance relative to the overall EDA market, which typically sees more moderate growth rates.
• The gross margin improvements also indicate efficient operations and strong pricing power compared to industry averages.

Legal Proceedings

• The Ninth Circuit Court of Appeals affirmed the dismissal of all claims against Silvaco brought by Aldini AG.
• A ruling in favor of Silvaco denied a motion for prejudgment interest in the Nangate Denmark ApS litigation.

Stakeholder Impact

• Shareholders can expect increased value due to the company's strong financial performance and growth prospects.
• Employees may benefit from increased job security and potential career advancement opportunities.
• Customers can expect continued innovation and high-quality solutions from Silvaco.
• Suppliers may benefit from increased business opportunities with Silvaco.
• Creditors can have confidence in the company's ability to meet its financial obligations.

Next Steps

• The company will report its final audited results and host its earnings conference call on March 5, 2025.
• Silvaco's CEO and CFO will participate in a fireside chat at the Needham Growth Conference on January 15, 2025.

Key Dates