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SkyWater Technology (SKYT)
NASDAQ:SKYT
US Market

SkyWater Technology (SKYT) AI Stock Analysis

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SkyWater Technology

(NASDAQ:SKYT)

Rating:61Neutral
Price Target:
$11.50
▲(5.02%Upside)
SkyWater Technology's overall stock score is driven primarily by its improving technical indicators and earnings call highlights, despite ongoing financial challenges and unattractive valuation. The positive technical momentum and strategic achievements are tempered by profitability issues and valuation concerns.
Positive Factors
Expansion and acquisition
SkyWater Technology's acquisition of Fab 25 from Infineon adds capacity and mitigates the risk of having just one front-end fab.
Financial performance
The company's gross margin for the March quarter exceeded prior guidance, aided by a warranty reversal, and is expected to improve further as sales volumes increase.
Wafer Services demand
SkyWater's wafer services revenue increased significantly, driven by growth in the ThermaView platform and customer transitions, with new products expected to represent a larger share of future revenue.
Negative Factors
ATS revenue decline
Advanced Technology Services (ATS) revenue experienced a decline, impacted by government spending delays and uncertainties in contract timing.
Federal budget delays
Federal budget negotiations have delayed R&D program funding, deferring the anticipated 2Q25 recovery in ATS to C2H25.
Market weakness
Wafer Services sales experienced a significant decrease due to prolonged weakness in the automotive and industrial markets.

SkyWater Technology (SKYT) vs. SPDR S&P 500 ETF (SPY)

SkyWater Technology Business Overview & Revenue Model

Company DescriptionSkyWater Technology, Inc., together with its subsidiaries, provides semiconductor development and manufacturing services. The company offers engineering and process development support services to co-create technologies with customers; and semiconductor manufacturing services for various silicon-based analog and mixed-signal, power discrete, microelectromechanical systems, and rad-hard integrated circuits. It serves customers operating in the computation, aerospace and defense, automotive and transportation, bio-health, consumer, and industrial/internet of things industries. The company was incorporated in 2017 and is headquartered in Bloomington, Minnesota.
How the Company Makes MoneySkyWater Technology generates revenue primarily through its semiconductor manufacturing services. The company operates as a foundry, offering custom fabrication services for integrated circuits and other microelectronics. Its revenue streams include fabrication services, design services, and non-recurring engineering (NRE) fees associated with custom projects. SkyWater's business model involves partnering with customers to co-develop semiconductor solutions tailored to specific applications, which allows the company to secure long-term contracts and partnerships. Additionally, SkyWater benefits from collaborations with government entities and private sector clients who require secure and reliable semiconductor manufacturing capabilities. The company's strategic focus on niche markets and advanced technology nodes helps it differentiate from larger, commodity-driven semiconductor foundries, providing a competitive edge in the industry.

SkyWater Technology Earnings Call Summary

Earnings Call Date:May 07, 2025
(Q1-2025)
|
% Change Since: 51.03%|
Next Earnings Date:Aug 12, 2025
Earnings Call Sentiment Neutral
The earnings call presented a balanced view, with significant achievements such as surpassing financial guidance, successful platform launches, and strategic acquisitions. However, these are tempered by challenges due to government budget delays and tariff uncertainties. While long-term prospects remain strong, short-term challenges are notable.
Q1-2025 Updates
Positive Updates
Exceeded Guidance in Key Financial Metrics
Revenues for Q1 were closely aligned with the outlook and just above the midpoint of the guidance range. Gross margin and non-GAAP EPS exceeded guidance, with adjusted EBITDA over $4 million.
Successful Launch of ThermaView Platform
The ThermaView platform, focused on advanced thermal imaging, drove over half of Q1's Wafer Services revenue, marking a significant strategic milestone for the company.
Strategic Acquisition of Fab 25
SkyWater is expanding its 200-millimeter foundry capacity in the U.S. through the acquisition of Infineon's Fab 25, expected to provide immediate revenue and positive cash flow.
Quantum Computing Advancements
Significant progress in quantum computing with partner D-Wave's announcement of quantum supremacy, positioning SkyWater as a key player in the quantum technology landscape.
Positive Cash Flow and Strong Financial Position
Ended the quarter with $51 million in cash, an increase of $32 million from year-end, with customer-funded capital expenditures and debt reduction.
Negative Updates
Challenges in ATS Revenue
ATS revenue was softer than expected due to continued budget delays and extended negotiations in Washington, D.C., affecting near-term revenue outlook.
Impact of Tariff Uncertainty
Uncertainty regarding tariff policies poses potential macroeconomic risks, although SkyWater's overall tariff exposure is relatively limited.
Delayed Government Funding
Prolonged U.S. federal budget negotiations have delayed the timing of key program funding for ATS customers, impacting expected revenue recovery.
Company Guidance
During SkyWater Technology's Q1 2025 earnings call, the company provided guidance that its fiscal year outlook remains largely unchanged, with a forecasted 5% revenue growth plus or minus 2% for its combined ATS and Wafer Services business. Q1 revenue came in at $61.3 million, slightly above the midpoint of guidance, with gross margin at 24.2% and adjusted EBITDA surpassing forecasts at over $4 million. The company anticipates Q2 revenues between $55 million and $60 million, with ATS revenues projected at $49 million to $53 million and Wafer Services at $5 million to $6 million. SkyWater expects a strong second half of 2025, driven by increased funding for ATS programs and the ongoing ramp of its advanced packaging business, aiming for positive non-GAAP EPS and adjusted EBITDA of at least 10% of total revenues for the year. The acquisition of Infineon's Fab 25 is expected to close mid-year, providing immediate revenue and positive cash flow, further diversifying SkyWater's business.

SkyWater Technology Financial Statement Overview

Summary
SkyWater Technology is experiencing gradual financial recovery, evidenced by improving operational margins and cash flow. However, the company continues to face profitability challenges, as reflected in its net losses and low return on equity. The reduction in debt levels is a positive sign of financial stabilization. Continued focus on revenue growth and cost management will be crucial for achieving sustainable profitability.
Income Statement
45
Neutral
SkyWater Technology's revenue has shown a fluctuating growth pattern, with a notable increase in 2023, but a decline in TTM (Trailing-Twelve-Months). Gross profit margins are improving, but net profit margins remain negative due to consistent net losses. The EBIT margin has improved from negative to positive territory in TTM, indicating operational improvements.
Balance Sheet
50
Neutral
The company's debt-to-equity ratio has decreased, reflecting reduced leverage. However, equity growth remains slow, and the equity ratio is relatively low. The return on equity remains negative, highlighting ongoing profitability challenges. The recent improvements in reducing debt are promising for financial stability.
Cash Flow
60
Neutral
SkyWater Technology has shown strong improvement in operating cash flow, with a significant increase in free cash flow. The operating cash flow to net income ratio has improved, indicating better cash earnings. However, the free cash flow to net income remains constrained by persistent net losses.
BreakdownTTMDec 2024Dec 2023Mar 2023Mar 2022Dec 2020
Income Statement
Total Revenue323.93M342.27M286.68M212.94M162.85M140.44M
Gross Profit70.90M69.63M59.29M25.97M-7.47M22.69M
EBITDA14.20M25.25M14.14M-2.68M-23.28M9.57M
Net Income-8.41M-6.79M-30.76M-36.87M-47.40M-19.71M
Balance Sheet
Total Assets326.76M313.77M316.76M305.76M263.60M263.21M
Cash, Cash Equivalents and Short-Term Investments51.23M18.84M18.38M30.02M12.92M7.44M
Total Debt4.94M76.76M72.86M92.85M59.45M72.60M
Total Liabilities140.00M250.28M256.06M251.79M203.67M264.79M
Stockholders Equity53.41M57.61M53.74M53.67M61.13M-16.00K
Cash Flow
Free Cash Flow54.39M7.20M-408.00K-31.24M-87.66M6.34M
Operating Cash Flow78.35M18.46M10.08M-15.86M-50.97M96.19M
Investing Cash Flow-24.32M-11.21M-10.49M-15.38M-34.54M-88.18M
Financing Cash Flow-22.80M-6.79M-11.23M48.86M90.98M-5.19M

SkyWater Technology Technical Analysis

Technical Analysis Sentiment
Positive
Last Price10.95
Price Trends
50DMA
8.56
Positive
100DMA
8.34
Positive
200DMA
9.27
Positive
Market Momentum
MACD
0.45
Negative
RSI
69.59
Neutral
STOCH
78.66
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SKYT, the sentiment is Positive. The current price of 10.95 is above the 20-day moving average (MA) of 9.29, above the 50-day MA of 8.56, and above the 200-day MA of 9.27, indicating a bullish trend. The MACD of 0.45 indicates Negative momentum. The RSI at 69.59 is Neutral, neither overbought nor oversold. The STOCH value of 78.66 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SKYT.

SkyWater Technology Risk Analysis

SkyWater Technology disclosed 55 risk factors in its most recent earnings report. SkyWater Technology reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

SkyWater Technology Peers Comparison

Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
74
Outperform
$369.51M24.5423.57%5.24%-13.18%-12.06%
63
Neutral
$33.61B6.06-11.53%1.82%5.53%-18.79%
61
Neutral
$477.97M-16.06%7.90%74.69%
59
Neutral
$1.21B-26.43%-16.95%-2.47%
56
Neutral
$775.68M-32.43%-7.09%-53.23%
54
Neutral
$970.74M-24.12%2.66%-11.35%
40
Neutral
$120.32M-180.49%-9.62%-30.36%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
SKYT
SkyWater Technology
10.95
3.30
43.14%
WOLF
Wolfspeed
0.77
-23.00
-96.76%
NVEC
NVE
76.39
8.60
12.69%
LASR
nLIGHT
19.64
8.65
78.71%
INDI
indie Semiconductor
3.70
-2.59
-41.18%
NVTS
Navitas Semiconductor
6.32
2.21
53.77%

SkyWater Technology Corporate Events

Private Placements and FinancingM&A Transactions
SkyWater Technology Completes Acquisition of Spansion Fab 25
Neutral
Jul 3, 2025

On June 30, 2025, SkyWater Technology, Inc. amended its Membership Interest Purchase Agreement with Spansion LLC, increasing the purchase price by $18 million and eliminating a $25 million payment tied to a supply agreement. This amendment was part of SkyWater’s acquisition of Spansion Fab 25, LLC, which involved acquiring assets related to Infineon Technologies AG’s fab in Austin, Texas. Additionally, SkyWater entered into an Amended and Restated Loan and Security Agreement with several lenders, establishing a $350 million revolving line of credit. This agreement aims to refinance existing debts, fund the acquisition, and support working capital and equipment needs. The transaction was completed on June 30, 2025, with a total purchase price of approximately $93 million paid in cash.

The most recent analyst rating on (SKYT) stock is a Buy with a $12.00 price target. To see the full list of analyst forecasts on SkyWater Technology stock, see the SKYT Stock Forecast page.

Executive/Board ChangesShareholder Meetings
SkyWater Technology Elects Directors at Annual Meeting
Neutral
May 22, 2025

SkyWater Technology, Inc. held its annual meeting of stockholders on May 21, 2025, where stockholders elected nine directors to serve until the 2026 annual meeting. Additionally, the appointment of KPMG LLP as the independent registered public accounting firm for fiscal 2025 was ratified. These decisions are expected to impact the company’s governance and financial oversight, potentially influencing its strategic direction and stakeholder confidence.

The most recent analyst rating on (SKYT) stock is a Buy with a $12.00 price target. To see the full list of analyst forecasts on SkyWater Technology stock, see the SKYT Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 03, 2025