PDF Solutions ((PDFS)) has held its Q3 earnings call. Read on for the main highlights of the call.
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PDF Solutions’ latest earnings call painted a picture of robust performance and strategic growth, underscored by record revenue and significant contract wins. The company demonstrated impressive advancements, particularly in AI and customer base expansion. However, there were concerns regarding a decline in integrated yield ramp revenue and a decrease in cash reserves due to ongoing investments.
Record Quarterly Revenue
PDF Solutions achieved a new milestone with its quarterly revenue, reaching $57.1 million for Q3. This figure represents a 10% increase from the previous quarter and a 23% rise compared to the same period last year, showcasing the company’s strong financial trajectory.
Strong Bookings and Backlog Growth
The company reported over $100 million in bookings for the quarter, surpassing the combined total of the previous two quarters. The backlog also saw a significant increase, ending Q3 at $292 million, which is 25% higher than the last quarter and 22% higher year-over-year.
Integration of Tiber AI Studio
PDF Solutions is enhancing its AI capabilities by integrating Tiber AI Studio, licensed from Intel, into its Exensio platform. This integration allows engineers to build and manage AI models more effectively, bolstering Exensio’s functionality.
Expansion in Customer Base
The company has significantly expanded its customer base, growing from approximately 150 customers in 2020 to over 370 in 2025. This expansion includes major players in the equipment industry and multiple cloud providers, highlighting PDF Solutions’ broadening market reach.
8-Figure Contracts Signed
PDF Solutions secured substantial contracts, including an 8-figure deal with a large IC manufacturer for its Exensio platform and another for secureWISE with a major OEM. These contracts underscore the company’s competitive edge and market demand for its solutions.
Decline in Integrated Yield Ramp Revenue
Despite overall growth, the company experienced a decline in integrated yield ramp revenue, which constituted 4% of total revenue in Q3, decreasing by $0.5 million from the previous quarter.
Cash and Short-term Investments Decrease
The company’s cash reserves saw a decrease, with cash, cash equivalents, and short-term investments dropping to $35.9 million from $40.4 million in the prior quarter, reflecting the impact of ongoing investments.
Significant CapEx Investments Impacting Cash Flow
PDF Solutions invested $6.3 million in capital expenditures, focusing on building eProbe machines and integrating secureWISE. These investments have influenced the company’s cash flow, indicating a strategic focus on long-term growth.
Forward-looking Guidance
Looking ahead, PDF Solutions remains optimistic, reaffirming its annual revenue growth guidance of 21% to 23% for 2025. The company anticipates continued revenue growth and increased cash flow, driven by strategic acquisitions and product development investments. The integration of Tiber AI Studio is expected to further enhance its analytics capabilities, supporting the positive fiscal outlook.
In conclusion, PDF Solutions’ earnings call highlighted a strong performance with record revenue and strategic advancements in AI and customer expansion. While there are concerns about cash reserves and specific revenue declines, the company’s forward-looking guidance remains positive, with expectations of sustained growth and enhanced capabilities.