PDF Solutions (PDFS) AI Stock Analysis

• Market Cap: $1.30B
• Dividend Yield: N/A
• Average Volume (3M): 249.14K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.65
• Revenue Growth: 21.23%
• EPS Growth: -101.40%
• Country: US
• Employees: 539
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 0.25
• Shares Outstanding: 39,512,960
• 10 Day Avg. Volume: 236,631
• 30 Day Avg. Volume: 249,143
• PEG Ratio: 7.44
• Price to Book (P/B): 4.25
• Price to Sales (P/S): 5.82
• P/FCF Ratio: -140.28
• Enterprise Value/Market Cap: 0.82
• Enterprise Value/Revenue: 5.13
• Enterprise Value/Gross Profit: 7.21
• Enterprise Value/Ebitda: 99.95
• 1Y Price Target: $34.75
• Price Target Upside: 5.59% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 69 Neutral
• Price Target: $36.00 ▲(9.39% Upside)

PDF Solutions' overall stock score is driven by strong financial performance and positive earnings call highlights, including record revenue and strategic contract wins. However, high valuation metrics and cash flow management challenges weigh on the score. The technical analysis suggests mixed signals, with short-term bearish momentum but longer-term bullish trends.

Positive Factors

Revenue Growth

Strong revenue growth indicates robust demand for PDF Solutions' products and services, enhancing its market position and supporting long-term business expansion.

Customer Base Expansion

The significant increase in customer base demonstrates the company's growing market penetration and potential for sustained revenue growth through diversified clientele.

Strategic Contracts

Securing large contracts with major industry players strengthens PDF Solutions' competitive position and provides a stable revenue stream, supporting long-term growth.

Negative Factors

Profitability Challenges

Low profitability margins indicate challenges in cost management and pricing power, which could hinder the company's ability to generate sustainable profits.

Cash Flow Management

Negative free cash flow suggests difficulties in covering capital expenditures and investments, potentially impacting financial flexibility and growth initiatives.

Decrease in Cash Reserves

A decrease in cash reserves could limit the company's ability to invest in growth opportunities and manage unforeseen expenses, affecting long-term stability.

PDF Solutions Business Overview & Revenue Model

Company Description

PDF Solutions, Inc. provides proprietary software and physical intellectual property products for integrated circuit designs, electrical measurement hardware tools, proven methodologies, and professional services in the United States, China, Japan, Taiwan, and internationally. The company offers Exensio software products, such as Manufacturing Analytics that stores collected data in a common environment with a consistent view for enabling product engineers to identify and analyze production yield, performance, reliability, and other issues; Process Control that provides failure detection and classification capabilities for monitoring, alarming, and controlling manufacturing tool sets; Test Operations that offers data collection and analysis capabilities; and Assembly Operations that provides device manufacturers with the capability to link assembly and packaging data, including fabrication and characterization data over the product life cycle. It also provides design-for-inspection (DFI) Systems, such as DFI on-chip instruments; eProbe non-contactless E-beam tool; and Characterization Vehicle (CV) system, which includes CV test chips and pdFasTest electrical testers, as well as Exensio characterization software, designed to analyze the measurements collected from DFI on-chip instruments using the eProbe tool. In addition, the company offers Cimetrix software products that enables equipment manufacturers to provide industry standard interfaces on their products; and software-as-a-service, software related services, and characterization services. It sells its technologies and services through direct sales force, service teams, and strategic alliances to integrated device manufacturers, fabless semiconductor companies, foundries, equipment manufacturers, electronics manufacturing suppliers, original device manufacturers, out-sourced semiconductor assembly and test, and system houses. The company was founded in 1991 and is headquartered in Santa Clara, California.

How the Company Makes Money

PDF Solutions generates revenue primarily through the sale of software licenses and related services. The company offers a subscription-based model for its software solutions, allowing clients to access its platforms on a recurring basis. Additionally, PDF Solutions earns revenue from professional services, including consulting and training, which help customers implement and maximize the value of its software. Key partnerships with major semiconductor manufacturers and technology firms enhance PDFS's market reach and contribute to its earnings by providing a stable customer base and opportunities for collaborative projects.

PDF Solutions Financial Statement Overview

Summary

PDF Solutions exhibits strong revenue growth and a robust gross profit margin, indicating operational efficiency. The balance sheet is stable with low leverage, but profitability and cash flow management need improvement. The company is on a growth trajectory but should focus on enhancing profitability and cash flow to strengthen its financial position further.

Income Statement

PDF Solutions shows a solid revenue growth rate of 5.46% TTM, indicating a positive trajectory. The gross profit margin is strong at 71.18%, reflecting efficient cost management. However, the net profit margin is relatively low at 2.10%, and the EBIT margin is slightly negative, suggesting some profitability challenges. Overall, the company demonstrates growth potential but needs to improve its profitability metrics.

Balance Sheet

The company maintains a healthy balance sheet with a low debt-to-equity ratio of 0.032, indicating low leverage and financial stability. The return on equity is modest at 1.70%, showing room for improvement in generating returns for shareholders. The equity ratio is strong, highlighting a solid capital structure. Overall, the balance sheet reflects financial stability with opportunities for enhancing shareholder returns.

Cash Flow

Operating cash flow is positive, but the free cash flow is negative, indicating potential liquidity challenges. The operating cash flow to net income ratio is 0.13, suggesting moderate cash generation relative to earnings. The free cash flow to net income ratio is negative, highlighting a need for better cash management. Overall, while operating cash flow is stable, the negative free cash flow requires attention.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	206.71M	179.47M	165.84M	148.55M	111.06M	88.05M
Gross Profit	147.12M	125.32M	114.09M	100.64M	66.87M	51.28M
EBITDA	10.61M	5.46M	6.12M	4.70M	-6.26M	-8.62M
Net Income	-53.00K	4.06M	3.10M	-3.43M	-21.49M	-40.36M
Balance Sheet
Total Assets	406.40M	315.29M	290.14M	278.67M	273.77M	287.58M
Cash, Cash Equivalents and Short-Term Investments	35.88M	114.89M	135.52M	139.18M	140.23M	145.30M
Total Debt	73.78M	5.18M	6.19M	7.34M	7.02M	8.44M
Total Liabilities	142.02M	69.25M	61.19M	68.66M	54.18M	53.07M
Stockholders Equity	264.38M	246.04M	228.95M	210.01M	219.59M	234.51M
Cash Flow
Free Cash Flow	-20.50M	-7.45M	3.13M	23.72M	190.00K	14.81M
Operating Cash Flow	8.32M	9.70M	14.60M	32.30M	4.24M	21.78M
Investing Cash Flow	-133.69M	-5.94M	-28.99M	84.60M	-4.67M	-150.50M
Financing Cash Flow	65.13M	-11.23M	-5.89M	-24.31M	-5.53M	64.80M

PDF Solutions Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 32.91
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PDFS, the sentiment is Positive. The current price of 32.91 is above the 20-day moving average (MA) of 29.98, above the 50-day MA of 28.52, and above the 200-day MA of 23.23, indicating a bullish trend. The MACD of 1.05 indicates Negative momentum. The RSI at 65.16 is Neutral, neither overbought nor oversold. The STOCH value of 87.93 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PDFS.

PDF Solutions Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PDFS	69 Neutral	$1.30B	-17,321.05	-0.02%	―	21.23%	-101.40%
VTEX	66 Neutral	$639.67M	96.85	6.53%	―	3.62%	-20.45%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
SPT	61 Neutral	$603.94M	-12.61	-26.69%	―	13.09%	32.34%
RSKD	51 Neutral	$722.82M	-20.11	-10.54%	―	6.54%	-19.17%
BMBL	51 Neutral	$404.73M	-1.88	-25.34%	―	-7.43%	61.36%

PDF Solutions Corporate Events

PDF Solutions Corrects Quarterly Revenue Mischaracterization

On November 6, 2025, PDF Solutions identified an error in its Quarterly Report for the quarter ended September 30, 2025. The error involved a mischaracterization of revenue changes, where an increase in Analytics revenue was incorrectly attributed. The correction clarified that the increase was due to higher revenues from DFI systems, partially offset by a decrease in Exensio software licenses revenue. This adjustment impacts the company’s financial reporting but does not affect its legal liabilities under the Securities Exchange Act.

The most recent analyst rating on (PDFS) stock is a Hold with a $29.00 price target. To see the full list of analyst forecasts on PDF Solutions stock, see the PDFS Stock Forecast page.