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SkyWater Technology (SKYT)
NASDAQ:SKYT
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SkyWater Technology
(NASDAQ:SKYT)
Rating:52Neutral
Price Target:
$11.00
▲(7.84% Upside)
Positive Factors
Acquisitions
SkyWater Technology's acquisition of Fab 25 from Infineon adds capacity and mitigates the risk of having just one front-end fab.
Partnerships
A multiyear wafer supply agreement with Infineon is expected to drive steady free cash flow contributions over that period.
Product Development
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
Government Contracts
Limited visibility towards the timing of government ATS contracts.
Government Spending
ATS continues to face funding-related headwinds due to the U.S. government operating under FY24 spending levels.
Market Demand
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)
Market Cap
$520.78M
Dividend YieldN/A
Average Volume (3M)1.26M
Price to Earnings (P/E)―
Beta (1Y)2.29
Revenue Growth-10.53%
EPS Growth36.86%
CountryUS
Employees702
SectorTechnology
Sector Strength83
IndustrySemiconductors
Share Statistics
EPS (TTM)-0.11
Shares Outstanding48,175,816
10 Day Avg. Volume1,179,363
30 Day Avg. Volume1,263,065
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap0.97
Enterprise Value/Revenue1.75
Enterprise Value/Gross Profit7.85
Enterprise Value/Ebitda40.59
Forecast
1Y Price Target
$14.25Price Target Upside39.71% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
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:Aug 06, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 05, 2025
Earnings Call Sentiment Neutral
The earnings call highlights significant achievements such as meeting revenue targets, completing a transformative acquisition, and expansion in quantum computing and advanced packaging. However, these are tempered by challenges in aerospace and defense funding, near-term gross margin compression due to the acquisition, and tariff-related delays.Q2-2025 Updates
Positive Updates
Revenue Achievement
Second quarter revenues came in at the upper end of the outlook at just over $59 million, with upside in gross margin, adjusted EBITDA, and non-GAAP EPS expectations.
Infineon Fab 25 Acquisition
Successfully completed the transformative acquisition of Infineon's Fab 25 in Austin, Texas, fully funded through a new debt facility with no future payments required. The acquisition is expected to double revenue scale and adjusted EBITDA immediately.
Quantum Computing Expansion
Strong momentum in quantum computing applications, with revenue growth in this segment expected to exceed 30% in 2025.
Advanced Packaging Progress
Advanced packaging operations in Florida are progressing ahead of schedule, with significant tool revenue expected in Q4 2025.
Financial Guidance for 2026
Provided guidance for at least $600 million in revenue and at least $60 million in adjusted EBITDA for fiscal year 2026.
Negative Updates
Aerospace and Defense Headwinds
Continued funding delays in government programs are affecting revenue levels, with expectations that these will continue through 2025.
Near-term Gross Margin Compression
Fab 25 acquisition is expected to compress gross margins in the near term due to purchase accounting adjustments and new depreciation expenses.
Tariff Uncertainties
Ongoing tariff uncertainties have delayed the installation of some tools in the advanced packaging operation.
Company Guidance
In the second quarter of 2025, SkyWater Technology reported revenues exceeding $59 million, reaching the upper end of their forecast. They achieved favorable results in gross margin, adjusted EBITDA, and non-GAAP EPS, primarily due to strong ATS revenues and effective cost management. The recent acquisition of Infineon's Fab 25 is projected to significantly enhance SkyWater's revenue scale, with anticipated contributions of $75 million to $80 million for Q3, and is expected to double their revenue scale and adjusted EBITDA immediately. The acquisition, completed with a $93 million upfront payment, is supported by a multiyear supply agreement with Infineon valued at over $1 billion. Looking forward, SkyWater expects continued growth driven by quantum computing and advanced packaging, with ATS revenues projected to reach approximately $50 million in Q3, and a significant boost from Florida in Q4. They anticipate Q4 Wafer Services revenue to be in the mid-$80 million range and ATS revenues in the mid-$50 million range, targeting adjusted EBITDA margins of at least 10%. For 2026, SkyWater projects at least $600 million in revenue and $60 million in adjusted EBITDA.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.Income Statement
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.45
Neutral
Balance Sheet
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.50
Neutral
Cash Flow
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.60
Neutral
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 289.66M | 342.27M | 286.68M | 212.94M | 162.85M | 140.44M |
| Gross Profit | 64.69M | 69.63M | 59.29M | 25.97M | -7.47M | 22.69M |
| EBITDA | 12.51M | 25.25M | 14.14M | -2.68M | -23.28M | 9.57M |
| Net Income | -16.49M | -6.79M | -30.76M | -36.87M | -47.40M | -19.71M |
Balance Sheet | ||||||
| Total Assets | 581.96M | 313.77M | 316.76M | 305.76M | 263.60M | 263.21M |
| Cash, Cash Equivalents and Short-Term Investments | 56.37M | 18.84M | 18.38M | 30.02M | 12.92M | 7.44M |
| Total Debt | 351.46M | 76.76M | 72.86M | 92.85M | 59.45M | 72.60M |
| Total Liabilities | 351.46M | 250.28M | 256.06M | 251.79M | 203.67M | 264.79M |
| Stockholders Equity | 45.24M | 57.61M | 53.74M | 53.67M | 61.13M | -16.00K |
Cash Flow | ||||||
| Free Cash Flow | 43.28M | 7.20M | -408.00K | -31.24M | -87.66M | 6.34M |
| Operating Cash Flow | 67.34M | 18.46M | 10.08M | -15.86M | -50.97M | 96.19M |
| Investing Cash Flow | -26.76M | -11.21M | -10.49M | -15.38M | -34.54M | -88.18M |
| Financing Cash Flow | -9.57M | -6.79M | -11.23M | 48.86M | 90.98M | -5.19M |
SkyWater Technology Technical Analysis
Neutral
10.20
Price Trends
10.78
Negative
9.50
Positive
9.60
Positive
Market Momentum
0.06
Positive
42.42
Neutral
9.01
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SKYT, the sentiment is Neutral. The current price of 10.2 is below the 20-day moving average (MA) of 11.74, below the 50-day MA of 10.78, and above the 200-day MA of 9.60, indicating a neutral trend. The MACD of 0.06 indicates Positive momentum. The RSI at 42.42 is Neutral, neither overbought nor oversold. The STOCH value of 9.01 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral 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 (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $315.67M | 21.72 | 23.09% | 5.99% | -9.22% | -13.57% | |
62 Neutral | $1.47B | ― | -20.63% | ― | 9.79% | 10.28% | |
61 Neutral | $35.52B | 8.84 | -11.06% | 1.87% | 8.55% | -8.14% | |
55 Neutral | $925.22M | ― | -36.20% | ― | -7.49% | -64.33% | |
52 Neutral | $520.78M | ― | -34.11% | ― | -10.53% | 36.86% | |
52 Neutral | $1.18B | ― | -32.05% | ― | -25.65% | -130.95% | |
41 Neutral | $194.03M | ― | -739.86% | ― | -6.14% | -63.68% |
* Technology Sector Average
Performance Comparison
SKYT
SkyWater Technology
10.20
1.51
17.38%
WOLF
Wolfspeed
1.25
-6.34
-83.53%
NVEC
NVE
66.72
-4.10
-5.79%
LASR
nLIGHT
28.87
18.39
175.48%
INDI
indie Semiconductor
4.30
1.08
33.54%
NVTS
Navitas Semiconductor
5.60
3.33
146.70%
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.
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.