Vicor Corporation Reports Results for the First Quarter Ended March 31, 2024
- Revenues decreased by 14.3% to $83.9 million for the first quarter of 2024.
- Gross margin increased to 53.8% for the same period.
- Net income was $2.6 million, reflecting a decrease from the previous year.
- Operating expenses rose to $44.0 million primarily due to increased legal expenses.
- Cash flow from operations was $2.7 million, lower than the corresponding period last year.
- Backlog decreased significantly to $150.3 million.
- CEO Dr. Patrizio Vinciarelli emphasized the importance of asserting Vicor Intellectual Property for future revenue growth.
- Revenues saw a 9.5% sequential decrease from the previous quarter.
- Net income significantly declined compared to the previous year.
- Cash flow from operations was lower than the same period last year.
- Backlog experienced a substantial decrease of 44.6%.
Insights
Reviewing Vicor Corporation's financials indicates a significant 14.3% year-over-year decline in revenue and a 9.5% decline from the previous quarter. This raises questions about the company's current market competitiveness and demand for their products. The uptick in gross margin as a percentage of revenue is promising, but it's overshadowed by increased operating expenses, particularly due to legal costs. The sharp 44.6% decrease in backlog points to potential challenges in sustaining future revenues. The dip in net income is substantial; yet, investors should consider the company's strategic moves, like licensing IP and investments in 5G technology, which might pay dividends later on.
For cash flow-sensitive investors, the decrease in cash flow from operations could be a red flag. It's imperative to note the capital expenditures remained relatively steady, indicating ongoing investments in the company's core operations. The company's cash position has marginally decreased, but with over
The reported decline in Vicor's revenue and backlog could be reflective of broader industry trends or company-specific issues. If it's the latter, scrutiny of Vicor's market strategy and product competitiveness becomes essential. The CEO's comments on leveraging their IP and the forthcoming 5G product line suggest a pivot towards high-demand sectors. However, the immediate market response to such strategic shifts can be tepid. The escalating current and power density demands in the market are real, but investors will keenly watch for concrete signs of Vicor successfully capitalizing on these trends.
There's an optimism about the company's positioning for future technology standards, such as 5G. But given the decline in backlog which could signal a cooling off in order bookings, investors might question the immediate term growth trajectory. It would be prudent for investors to look out for independent market research validating the company’s claim about its competitive advantage in performance and foundry capacity.
The disclosed increase in legal expenses is notable. Legal campaigns to assert intellectual property can either be a defensive necessity or an aggressive revenue strategy. For Vicor, it seems to be the latter, with the CEO highlighting the correlation between the legal efforts and a 'step up' in royalty income. Licensing IP to OEMs opens a potential revenue stream, but it's a delicate balance; it can either signify a strong portfolio of enforceable patents or a shift from core business focus.
From an investor's standpoint, the effectiveness of these legal pursuits in contributing to the bottom line will be under scrutiny. They should weigh the risks of potential litigation costs against the benefits of successful IP monetization. The company's proactive stance on legal matters may also deter patent infringements, possibly making Vicor an attractive partner for OEMs seeking to avoid disputes.
ANDOVER, Mass., April 23, 2024 (GLOBE NEWSWIRE) -- Vicor Corporation (NASDAQ: VICR) today reported financial results for the first quarter ended March 31, 2024. 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, 2024 totaled
Gross margin decreased to
Net income for the first quarter was
Cash flow from operations totaled
Backlog for the first quarter ended March 31, 2024 totaled
Commenting on first quarter performance, Chief Executive Officer Dr. Patrizio Vinciarelli stated: “Q1 gross margins and operating expenses reflect a step up in royalty income and legal expenses relating to our campaign to assert Vicor Intellectual Property. Licenses to OEMs, giving access to patented power system technology from otherwise infringing suppliers, will complement future revenues from our 5G product line and ChiP foundry. These capabilities position Vicor ahead of demands for escalating current and power density, with superior performance and foundry capacity that anticipate market requirements.”
“As we confront challenges and pursue opportunities, 2024 will be seen as the year in which our product strategy, selective licensing of Intellectual Property and clarity of purpose secured Vicor’s future growth and profitability. We are pleased with our execution of this comprehensive vision.”
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 23, 2024 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 23, 2024. 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, 2023, 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, | ||||||
| 2024 | 2023 | ||||||
| Net revenues | $ | 83,872 | $ | 97,816 | |||
| Cost of revenues | 38,749 | 51,282 | |||||
| Gross margin | 45,123 | 46,534 | |||||
| Operating expenses: | |||||||
| Selling, general and administrative | 25,999 | 20,223 | |||||
| Research and development | 18,039 | 15,869 | |||||
| Total operating expenses | 44,038 | 36,092 | |||||
| Income from operations | 1,085 | 10,442 | |||||
| Other income (expense), net | 2,724 | 1,950 | |||||
| Income before income taxes | 3,809 | 12,392 | |||||
| Less: Provision for income taxes | 1,194 | 1,141 | |||||
| Consolidated net income | 2,615 | 11,251 | |||||
| Less: Net income attributable to noncontrolling interest | 11 | 7 | |||||
| Net income attributable to Vicor Corporation | $ | 2,604 | $ | 11,244 | |||
| Net income per share attributable to Vicor Corporation: | |||||||
| Basic | $ | 0.06 | $ | 0.25 | |||
| Diluted | $ | 0.06 | $ | 0.25 | |||
| Shares outstanding: | |||||||
| Basic | 44,516 | 44,162 | |||||
| Diluted | 45,031 | 44,907 | |||||
| VICOR CORPORATION | |||||||
| CONDENSED CONSOLIDATED BALANCE SHEET | |||||||
| (Thousands) | |||||||
| MAR 31, | DEC 31, | ||||||
| 2024 | 2023 | ||||||
| (Unaudited) | (Unaudited) | ||||||
| Assets | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 239,172 | $ | 242,219 | |||
| Accounts receivable, net | 57,604 | 52,631 | |||||
| Inventories | 112,316 | 106,579 | |||||
| Other current assets | 19,173 | 18,937 | |||||
| Total current assets | 428,265 | 420,366 | |||||
| Long-term deferred tax assets | 277 | 296 | |||||
| Long-term investment, net | 2,622 | 2,530 | |||||
| Property, plant and equipment, net | 157,677 | 157,689 | |||||
| Other assets | 16,276 | 14,006 | |||||
| Total assets | $ | 605,117 | $ | 594,887 | |||
| Liabilities and Equity | |||||||
| Current liabilities: | |||||||
| Accounts payable | $ | 12,438 | $ | 12,100 | |||
| Accrued compensation and benefits | 11,636 | 11,227 | |||||
| Accrued expenses | 7,078 | 5,093 | |||||
| Accrued litigation | 6,500 | 6,500 | |||||
| Sales allowances | 3,130 | 3,482 | |||||
| Short-term lease liabilities | 1,812 | 1,864 | |||||
| Income taxes payable | 1,726 | 746 | |||||
| Short-term deferred revenue and customer prepayments | 2,684 | 3,157 | |||||
| Total current liabilities | 47,004 | 44,169 | |||||
| Long-term deferred revenue | 660 | 1,020 | |||||
| Long-term income taxes payable | 2,236 | 2,228 | |||||
| Long-term lease liabilities | 6,094 | 6,364 | |||||
| Total liabilities | 55,994 | 53,781 | |||||
| Equity: | |||||||
| Vicor Corporation stockholders' equity: | |||||||
| Capital stock | 389,931 | 384,395 | |||||
| Retained earnings | 299,278 | 296,674 | |||||
| Accumulated other comprehensive loss | (1,390 | ) | (1,273 | ) | |||
| Treasury stock | (138,927 | ) | (138,927 | ) | |||
| Total Vicor Corporation stockholders' equity | 548,892 | 540,869 | |||||
| Noncontrolling interest | 231 | 237 | |||||
| Total equity | 549,123 | 541,106 | |||||
| Total liabilities and equity | $ | 605,117 | $ | 594,887 | |||
FAQ
What were Vicor 's revenues for the first quarter of 2024?
What was Vicor 's net income for the first quarter of 2024?
What was the gross margin percentage for Vicor in the first quarter of 2024?
Why did Vicor 's operating expenses increase in the first quarter of 2024?
What was Vicor 's cash flow from operations for the first quarter of 2024?
How did Vicor 's backlog change in the first quarter of 2024?
What did CEO Dr. Patrizio Vinciarelli emphasize regarding Vicor 's future growth?
