Vicor Corporation Reports Results for the First Quarter Ended March 31, 2025

Rhea-AI Summary

Vicor Corporation (NASDAQ: VICR) reported mixed Q1 2025 financial results. Revenue reached $94.0 million, showing a 12.0% year-over-year increase but a 2.3% sequential decrease. The company's gross margin declined to 47.2% from 53.8% year-over-year.

Notable highlights include:

• Net income improved to $2.5 million ($0.06 per share), compared to a loss of $14.5 million year-over-year
• Cash flow from operations strengthened to $20.1 million
• Cash position increased 6.8% to $296.1 million
• Backlog grew 14.2% year-over-year to $171.7 million

CEO Dr. Patrizio Vinciarelli noted reduced income from a licensee transitioning to new products. The company is developing 2nd generation VPD for AI applications, with an ASIC improving density and bandwidth. Vicor focuses on completing initial delivery of a high-density VPD system to a lead customer before providing demo systems to processor companies and hyper-scalers.

Positive

• Revenue increased 12% YoY to $94M
• Backlog grew 14.2% YoY to $171.7M
• Cash flow from operations improved significantly to $20.1M vs $2.6M YoY
• Cash position strengthened to $296.1M, up 6.8% from Q4 2024
• Returned to profitability with $2.5M net income vs ($14.5M) loss YoY
• Operating expenses decreased substantially to $44.5M from $61.2M YoY
• New ASIC development advancing for 2nd generation VPD AI applications

Negative

• Revenue declined 2.3% sequentially from Q4 2024
• Gross margin dropped to 47.2% from 53.8% YoY
• Operating expenses increased from $41.2M in Q4 2024 to $44.5M
• Net income decreased to $0.06 per share from $0.23 in Q4 2024
• Reduced income from licensee transitioning to unlicensed products
• ChiP fab utilization remains below optimal levels

Insights

Financial Analyst

Vicor shows mixed Q1 results with 12% YoY revenue growth but declining margins, returning to profitability with strong cash generation despite challenges.

Vicor Corporation's Q1 2025 financial results reveal a company in transition with mixed performance metrics. Revenue reached $94.0 million, growing 12.0% year-over-year but declining 2.3% sequentially. The revenue mix shows product revenue at $83.2 million (up 9.9% YoY) while royalty revenue reached $10.8 million (up 31.6% YoY).

Gross margin deteriorated significantly to 47.2% from 53.8% a year ago and 52.4% in Q4 2024. This 6.6% year-over-year margin contraction coincides with a 28.0% increase in product costs against just 9.9% product revenue growth, indicating substantial manufacturing efficiency challenges.

The company returned to profitability with net income of $2.5 million ($0.06 per share) versus a $14.5 million loss a year ago, though this comparison benefits from the absence of a $17.2 million litigation expense in Q1 2024.

Cash performance stands out as a strength, with operating cash flow of $20.1 million compared to just $2.6 million a year ago. The balance sheet strengthened with cash and equivalents growing to $296.1 million, up 6.8% sequentially. Inventory decreased to $98.5 million from $106.0 million, potentially contributing to the strong cash generation.

Backlog grew to $171.7 million, up 14.2% year-over-year and 10.4% sequentially, suggesting healthy demand despite near-term challenges. Management indicated margin improvements await higher ChiP fab utilization and increased licensing income.

Technology Analyst

Vicor advances AI power solutions with 2nd-gen VPD technology featuring higher density ASICs, while navigating patent enforcement and customer deployment challenges.

Vicor's Q1 2025 results highlight the company's strategic positioning in power delivery for artificial intelligence infrastructure. The company is developing second-generation Vertical Power Delivery (VPD) technology specifically targeting leading AI applications, with CEO Vinciarelli confirming the arrival of an ASIC that enhances density and bandwidth of their current multipliers.

The technology roadmap focuses on enabling "AI processors setting new standards for performance," positioning Vicor's power solutions as critical infrastructure for next-generation compute. The company is currently prioritizing delivery of "a very high density VPD system" to a lead customer before providing demonstration systems to processor chip companies and hyperscalers, indicating a sequential go-to-market approach that validates the technology before wider deployment.

Intellectual property protection appears central to Vicor's strategy, with the CEO noting that licensing has been "gaining traction with OEMs and hyper-scalers wishing to avoid infringing hardware being excluded from importation into the US." This suggests active patent enforcement efforts alongside technology development.

A noteworthy challenge emerged with the mention of "reduced income from a licensee transitioning to a new generation of unlicensed products," which contributed to margin pressure during the quarter. This transition highlights the competitive dynamics in the power delivery space and potential sustainability challenges in the licensing business model.

R&D expenses increased 7.4% year-over-year to $19.4 million, representing 20.6% of revenue, underscoring the company's continued investment in technology development despite near-term profitability challenges.

ANDOVER, Mass., April 29, 2025 (GLOBE NEWSWIRE) -- Vicor Corporation (NASDAQ: VICR) today reported financial results for the first quarter ended March 31, 2025. These results will be discussed later today at 5:00 p.m. Eastern Time, during management’s quarterly investor conference call. The details for the call are below.

Revenues for the first quarter ended March 31, 2025 totaled $94.0 million, a 12.0% increase from $83.9 million for the corresponding period a year ago, and a 2.3% sequential decrease from $96.2 million in the fourth quarter of 2024.

Gross margin decreased to $44.4 million for the first quarter of 2025, compared to $45.1 million for the corresponding period a year ago, and decreased sequentially from $50.4 million for the fourth quarter of 2024. Gross margin, as a percentage of revenue, decreased to 47.2% for the first quarter of 2025, compared to 53.8% for the corresponding period a year ago, and decreased from 52.4% for the fourth quarter of 2024. Operating expenses decreased to $44.5 million for the first quarter of 2025, compared to $61.2 million for the corresponding period a year ago, and increased sequentially from $41.2 million for the fourth quarter of 2024.

Net income for the first quarter was $2.5 million, or $0.06 per diluted share, compared to a net loss of ($14.5) million or ($0.33) per diluted share, for the corresponding period a year ago and net income of $10.2 million, or $0.23 per diluted share, for the fourth quarter of 2024.

Cash flow from operations totaled $20.1 million for the first quarter, compared to cash flow from operations of $2.6 million for the corresponding period a year ago, and cash flow from operations of $10.1 million in the fourth quarter of 2024. Capital expenditures for the first quarter totaled $4.6 million, compared to $7.3 million for the corresponding period a year ago and $1.7 million for the fourth quarter of 2024. Cash and cash equivalents as of March 31, 2025 increased 6.8% sequentially to approximately $296.1 million compared to approximately $277.3 million as of December 31, 2024.

Backlog for the first quarter ended March 31, 2025 totaled $171.7 million, a 14.2% increase from $150.3 million for the corresponding period a year ago, and 10.4% sequential increase from $155.5 million at the end of the fourth quarter of 2024.

Commenting on first quarter performance, Chief Executive Officer Dr. Patrizio Vinciarelli stated: “Revenues and gross margins declined sequentially, with reduced income from a licensee transitioning to a new generation of unlicensed products. Margin improvements await higher utilization of our ChiP fab and increased income from existing and future licensees. Licensing has been gaining traction with OEMs and hyper-scalers wishing to avoid infringing hardware being excluded from importation into the US.”

“Our 2^nd generation VPD for leading AI applications is coming to fruition with the arrival of an ASIC raising the density and bandwidth of our current multipliers. Second generation VPD will enable AI processors setting new standards for performance. We are still focused on completing initial delivery of a very high density VPD system to a lead customer before providing demo systems to processor chip companies and hyper-scalers.”

For more information on Vicor and its products, please visit the Company’s website at www.vicorpower.com.

Earnings Conference Call

Vicor will be holding its investor conference call today, Tuesday, April 29, 2025 at 5:00 p.m. Eastern Time. Vicor encourages investors and analysts who intend to ask questions via the conference call to register with Notified, the service provider hosting the conference call. Those registering on Notified’s website will receive dial-in info and a unique PIN to join the call as well as an email confirmation with the details. Registration may be completed at any time prior to 5:00 p.m. on April 29, 2025. For those parties interested in listen-only mode, the conference call will be webcast via a link that will be posted on the Investor Relations page of Vicor's website prior to the conference call. Please access the website at least 15 minutes prior to the conference call to register and, if necessary, download and install any required software. For those who cannot participate in the live conference call, a webcast replay of the conference call will also be available on the Investor Relations page of Vicor's website.

This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Any statement in this press release that is not a statement of historical fact is a forward-looking statement, and, the words “believes,” “expects,” “anticipates,” “intends,” “estimates,” “plans,” “assumes,” “may,” “will,” “would,” “should,” “continue,” “prospective,” “project,” and other similar expressions identify forward-looking statements. Forward-looking statements also include statements regarding bookings, shipments, revenue, profitability, targeted markets, increase in manufacturing capacity and utilization thereof, future products and capital resources. These statements are based upon management’s current expectations and estimates as to the prospective events and circumstances that may or may not be within the company’s control and as to which there can be no assurance. Actual results could differ materially from those projected in the forward-looking statements as a result of various factors, including those economic, business, operational and financial considerations set forth in Vicor’s Annual Report on Form 10-K for the year ended December 31, 2024, under Part I, Item I — “Business,” under Part I, Item 1A — “Risk Factors,” under Part I, Item 3 — “Legal Proceedings,” and under Part II, Item 7 — “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” The risk factors set forth in the Annual Report on Form 10-K may not be exhaustive. Therefore, the information contained in the Annual Report on Form 10-K should be read together with other reports and documents filed with the Securities and Exchange Commission from time to time, including Forms 10-Q, 8-K and 10-K, which may supplement, modify, supersede or update those risk factors. Vicor does not undertake any obligation to update any forward-looking statements as a result of future events or developments.

Vicor Corporation designs, develops, manufactures, and markets modular power components and complete power systems based upon a portfolio of patented technologies. Headquartered in Andover, Massachusetts, Vicor sells its products to the power systems market, including enterprise and high performance computing, industrial equipment and automation, telecommunications and network infrastructure, vehicles and transportation, and aerospace and defense electronics.
  
For further information contact:
        
James F. Schmidt, Chief Financial Officer
Office: (978) 470-2900
Email: invrel@vicorpower.com

VICOR CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(Thousands except for per share amounts)
	QUARTER ENDED
	(Unaudited)
	MAR 31,				MAR 31,
	2025				2024
Product revenue	$	83,206			$	75,692
Royalty revenue		10,762				8,180
Net revenues		93,968				83,872
Cost of product revenues		49,603				38,749
Gross margin		44,365				45,123
Operating expenses:
Selling, general and administrative		25,137				25,999
Research and development		19,377				18,039
Litigation-contingency expense		-				17,200
Total operating expenses		44,514				61,238
Loss from operations		(149	)			(16,115	)
Other income (expense), net		3,134				2,724
Income (loss) before income taxes		2,985				(13,391	)
Less: Provision for income taxes		424				1,071
Consolidated net income (loss)		2,561				(14,462	)
Less: Net income attributable to
noncontrolling interest		22				11
Net income (loss) attributable to
Vicor Corporation	$	2,539			($	14,473	)
Net income (loss) per share attributable
to Vicor Corporation:
Basic	$	0.06			($	0.33	)
Diluted	$	0.06			($	0.33	)
Shares outstanding:
Basic		45,217				44,516
Diluted		45,495				44,516

VICOR CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
(Thousands)
	MAR 31,				DEC 31,
	2025				2024
	(Unaudited)				(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	296,099			$	277,273
Accounts receivable, net		65,864				52,948
Inventories		98,515				106,032
Other current assets		26,486				26,781
Total current assets		486,964				463,034
Long-term deferred tax assets		273				261
Long-term investment, net		2,664				2,641
Property, plant and equipment, net		153,117				152,705
Other assets		22,020				22,477
Total assets	$	665,038			$	641,118
Liabilities and Equity
Current liabilities:
Accounts payable	$	16,866			$	8,737
Accrued compensation and benefits		12,548				10,852
Accrued expenses		8,558				6,589
Accrued litigation		27,219				26,888
Sales allowances		2,114				1,667
Short-term lease liabilities		1,675				1,716
Income taxes payable		57				59
Short-term deferred revenue and customer prepayments		6,624				5,312
Total current liabilities		75,661				61,820
Long-term income taxes payable		3,461				3,387
Long-term lease liabilities		5,353				5,620
Total liabilities		84,475				70,827
Equity:
Vicor Corporation stockholders' equity:
Capital stock		415,702				408,187
Retained earnings		305,342				302,803
Accumulated other comprehensive loss		(1,312	)			(1,495	)
Treasury stock		(139,424	)			(139,424	)
Total Vicor Corporation stockholders' equity		580,308				570,071
Noncontrolling interest		255				220
Total equity		580,563				570,291
Total liabilities and equity	$	665,038			$	641,118

FAQ

How much did Vicor (VICR) revenue grow in Q1 2025 compared to Q1 2024?

Vicor's revenue grew 12.0% year-over-year, reaching $94.0 million in Q1 2025 compared to $83.9 million in Q1 2024.

What caused Vicor's (VICR) profit margin decline in Q1 2025?

Vicor's gross margin declined to 47.2% in Q1 2025 from 53.8% in Q1 2024, primarily due to reduced income from a licensee transitioning to unlicensed products and lower ChiP fab utilization.

How much cash does Vicor (VICR) have as of March 2025?

Vicor reported cash and cash equivalents of $296.1 million as of March 31, 2025, a 6.8% increase from $277.3 million at the end of December 2024.

What is Vicor's (VICR) backlog trend in Q1 2025?

Vicor's backlog increased 14.2% year-over-year to $171.7 million in Q1 2025, and showed a 10.4% sequential increase from Q4 2024's $155.5 million.

What are Vicor's (VICR) plans for AI processor development?

Vicor is developing a 2nd generation VPD with an ASIC for leading AI applications, focusing on higher density and bandwidth. They plan to deliver a high-density VPD system to a lead customer before providing demo systems to processor companies and hyper-scalers.