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Silvaco Group, Inc. (SVCO)
NASDAQ:SVCO
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Silvaco Group, Inc.
(NASDAQ:SVCO)
41Neutral
Positive Factors
Customer Expansion
The Dec '24 quarter saw the addition of 13 new customers, totaling 46 new customers for the year.
Market Differentiation
Silvaco's focus on niche applications in the display, power, and memory markets sets it apart from its competitors.
Revenue Growth
Silvaco's CY25 revenue growth is projected to be 400 basis points above its large-cap peers, indicating a strong performance outlook.
Negative Factors
Bookings Decline
Sharp bookings decline to $9.9M in September 2024 quarter, a decrease of 21% year-over-year.
R&D and Acquisition Costs
FY25 EPS is expected to decline meaningfully from the FY24 level due to increased R&D investments and acquisition costs.
US-China Policy Impact
US-China policy and broad market softness in Asia could remain headwinds to Silvaco's order flow momentum.
Silvaco Group, Inc. (SVCO) vs. S&P 500 (SPY)
Market Cap
$148.24M
Dividend YieldN/A
Average Volume (3M)199.99K
Price to Earnings (P/E)―
Beta (1Y)1.94
Revenue GrowthN/A
EPS GrowthN/A
CountryUS
Employees8
SectorGeneral
Sector StrengthN/A
IndustrySoftware
Share Statistics
EPS (TTM)-1.49
Shares Outstanding28,672,400
10 Day Avg. Volume186,628
30 Day Avg. Volume199,988
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)2.48
Price to Cash Flow (P/CF)-4.10
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$15.80Price Target Upside207.39% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering5
Silvaco Group, Inc. Business Overview & Revenue Model
Company DescriptionSilvaco Group, Inc. (SVCO) is a leading provider of electronic design automation (EDA) software and semiconductor intellectual property (IP) solutions. The company operates within the semiconductor industry, focusing on delivering innovative software tools and services that facilitate the design and production of semiconductor devices. SVCO's core products include a comprehensive suite of EDA tools that cater to analog, mixed-signal, and power IC design, as well as custom integrated circuit (IC) physical design. Additionally, the company offers process and device simulation solutions, enabling semiconductor companies to optimize their manufacturing processes and improve device performance.
How the Company Makes MoneySilvaco Group, Inc. generates revenue primarily through the sale of its EDA software licenses and subscriptions. The company offers both perpetual and subscription-based licensing models, allowing customers to choose the most suitable option based on their needs. Besides software licensing, SVCO provides maintenance and support services, generating recurring revenue streams. The company also benefits from consulting and training services that help clients maximize the value of their software investments. While the company partners with various semiconductor companies to enhance its product offerings, specific partnership details and their impact on earnings are not publicly disclosed.
Silvaco Group, Inc. Financial Statement Overview
Summary
Silvaco Group, Inc. shows potential with strong revenue growth and a solid equity base, but struggles with profitability and cash flow management. The company must address operational inefficiencies to enhance its financial health, focusing on turning revenue growth into sustainable profits and positive cash flow.Income Statement
Silvaco Group, Inc. has experienced revenue growth over the years; however, the company's profitability remains a concern. While gross profit margins are healthy, the negative EBIT and net profit margins indicate significant operational challenges. The recent downturn in net income highlights ongoing struggles in achieving profitability.35
Negative
Balance Sheet
The company's balance sheet shows a strong equity base with a low debt-to-equity ratio, indicating low financial leverage. However, the return on equity is negative due to recurring net losses. Overall, the company's financial position is stable with ample cash reserves, but profitability issues cast a shadow over its equity returns.55
Neutral
Cash Flow
Silvaco Group, Inc. faces challenges with negative free cash flow and operating cash flow, indicating cash management issues. While there has been a significant influx from financing activities, the sustainability of operations without external funding remains dubious. The company needs to improve cash generation from its core operations.40
Negative
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 50.33M | 59.68M | 54.25M | 46.47M | 41.96M | 40.28M | Gross Profit |
| 41.34M | 47.64M | 44.89M | 37.59M | 33.31M | 31.61M | EBIT |
| -184.00K | -40.28M | 1.13M | 27.00K | -3.54M | 3.64M | EBITDA |
| 81.00K | -36.74M | 1.74M | -1.11M | -2.37M | 4.46M | Net Income Common Stockholders |
| -2.77M | -39.40M | -316.00K | -3.93M | -1.84M | 2.55M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 82.68M | 82.68M | 4.42M | 5.48M | 6.70M | 9.72M | Total Assets |
| 142.34M | 142.34M | 40.88M | 38.72M | 35.73M | 41.91M | Total Debt |
| 1.69M | 1.69M | 3.93M | 8.47M | 501.00K | 3.49M | Net Debt |
| -17.92M | -17.92M | -488.00K | 2.99M | -6.20M | -6.23M | Total Liabilities |
| 42.26M | 42.26M | 31.48M | 28.70M | 21.36M | 24.67M | Stockholders Equity |
| 100.08M | 100.08M | 9.40M | 10.02M | 14.37M | 17.24M |
| Cash Flow | Free Cash Flow | ||||
| 2.68M | -20.28M | 841.00K | -2.19M | -2.73M | 5.29M | Operating Cash Flow |
| 2.97M | -19.77M | 1.18M | -2.10M | -2.64M | 5.78M | Investing Cash Flow |
| -295.50K | -66.53M | -339.00K | -89.00K | 234.00K | -1.60M | Financing Cash Flow |
| -1.84M | 101.30M | -1.65M | 624.00K | 60.00K | 2.33M |
Silvaco Group, Inc. Technical Analysis
Negative
5.14
Price Trends
6.95
Negative
7.34
Negative
11.44
Negative
Market Momentum
-0.56
Negative
36.75
Neutral
76.49
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SVCO, the sentiment is Negative. The current price of 5.14 is below the 20-day moving average (MA) of 5.45, below the 50-day MA of 6.95, and below the 200-day MA of 11.44, indicating a bearish trend. The MACD of -0.56 indicates Negative momentum. The RSI at 36.75 is Neutral, neither overbought nor oversold. The STOCH value of 76.49 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SVCO.
Silvaco Group, Inc. Peers Comparison
Overall Rating
UnderperformOutperform
Sector (55)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $99.55B | 23.56 | 50.42% | 1.13% | 13.21% | 27.25% | |
77 Outperform | $95.21B | 30.13 | 96.81% | 0.88% | 12.19% | 20.80% | |
76 Outperform | $125.42B | 20.20 | 35.19% | 1.05% | 4.45% | -10.01% | |
66 Neutral | $70.86B | 68.09 | 26.13% | ― | 13.48% | 0.66% | |
63 Neutral | $69.58B | 33.17 | 16.27% | ― | -1.19% | 48.33% | |
55 Neutral | $4.79B | -12.18 | -1.05% | 4.95% | 29.08% | -73.94% | |
41 Neutral | $148.24M | ― | -44.74% | ― | ― | ― |
* General Sector Average
Performance Comparison
SVCO
Silvaco Group, Inc.
5.14
-13.77
-72.82%
AMAT
Applied Materials
152.12
-54.60
-26.41%
CDNS
Cadence Design
262.42
-53.79
-17.01%
KLAC
KLA
706.49
12.95
1.87%
LRCX
Lam Research
75.84
-20.24
-21.07%
SNPS
Synopsys
448.60
-135.72
-23.23%
Silvaco Group, Inc. Earnings Call Summary
Earnings Call Date: Mar 5, 2025 | % Change Since: -15.88% | Next Earnings Date: Jun 19, 2025
Earnings Call Sentiment Neutral
While Silvaco achieved several strategic milestones, including strong customer traction, key partnerships, and record future revenue expectations, the company faced challenges with a decline in Q3 revenue, significant order delays from China, and increased operating expenses resulting in a net loss for the quarter.Highlights
Strong Customer Traction
Signed 14 new customers in Q3, bringing the year-to-date new customer wins to 33. Strong demand in power, automotive, and IoT markets.
Strategic Partnerships and Collaborations
Announced partnerships with Purdue, Stanford, and Arizona State University to address talent shortages and enhance research.
Inclusion in Russell Indices
Silvaco was added to the Russell 2000, Russell 3000, and Russell Microcap indices, increasing visibility and shareholder base.
ISO 9001 Certification
Achieved ISO 9001 certification for TCAD, ADA, and NIP products in October, enhancing credibility and quality assurance.
Record Quarterly Revenue Expected in Q4
Guidance for Q4 revenue is $18.1 million to $21.2 million, which would be a record for the company.
Lowlights
Decline in Revenue and Bookings
Q3 revenue was $11 million, down 27% year-over-year, and bookings were $9.9 million, a decrease of 21% year-over-year.
Challenges in China
Delayed orders from China, which represents 17% of the year-to-date revenue. The macroeconomic environment led to order delays.
SIP Revenue Decline
SIP revenue is down $2.1 million or 34% year-to-date, impacted by delays in renewing strategic refill agreements and order delays in Asia.
Increased Operating Expenses
Non-GAAP operating expenses were $11.3 million, up from $9.9 million in the same period last year, due to increased costs in G&A, R&D, and sales and marketing.
Net Loss for the Quarter
Reported a non-GAAP net loss of $1.8 million compared to a non-GAAP net income of $2.3 million in Q3 2023.
Company Guidance
During Silvaco's Q3 2024 earnings call, the company provided guidance indicating strong growth expectations for the fourth quarter and the full year. They anticipate gross bookings in the range of $64 million to $67 million for the year, representing a 10% to 15% increase from 2023. Revenue is expected to reach between $60 million and $63 million, marking a 10% to 16% year-over-year growth. For Q4, they project bookings between $18.5 million and $21.5 million, and revenue from $18.1 million to $21.2 million, which would set a new record for quarterly revenue. Silvaco also expects to maintain non-GAAP gross margins between 85% and 87% for the year. The company remains committed to achieving long-term financial targets of 15% to 25% top-line growth, 90% non-GAAP gross margin, and 25% plus non-GAAP operating margin through market expansion and strategic acquisitions.Silvaco Group, Inc. Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
Silvaco Group Announces CFO Resignation and Transition Plan
Neutral
Mar 21, 2025
On March 18, 2025, Silvaco Group, Inc. announced the resignation of its Chief Financial Officer, Ryan Benton, effective April 11, 2025. Benton is leaving to pursue a new career opportunity outside of the semiconductor design industry, and his departure is not due to any disagreements with the company. To ensure a smooth transition, CEO Dr. Babak Taheri will temporarily take on the roles of principal financial officer and principal accounting officer, while Keith Tainsky will serve as Interim Chief Financial Officer. The company has started the process of finding Benton’s successor. Additionally, Silvaco reaffirmed its financial guidance for the first quarter and full year of fiscal 2025, indicating stability and confidence in its strategic direction.
M&A TransactionsBusiness Operations and Strategy
Silvaco Group Completes Strategic Acquisition of OPC Product Line
Positive
Mar 4, 2025
On March 4, 2025, Silvaco, Inc., a subsidiary of Silvaco Group, Inc., completed the acquisition of Cadence Design Systems, Inc.’s Process Proximity Compensation product line, an optical proximity correction tool. This strategic acquisition is expected to enhance Silvaco’s market position by integrating Cadence’s OPC expertise and technology, thereby advancing Silvaco’s AI-based FTCO platform and computational lithography solutions. The acquisition aims to provide seamless integration and continuity for existing customers, while unlocking new market opportunities and fostering customer collaborations. Silvaco anticipates that this move will drive further innovation and growth in the semiconductor manufacturing sector.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.