SANTA CLARA, Calif., June 20, 2024 (GLOBE NEWSWIRE) -- Silvaco Group, Inc. (Nasdaq: SVCO, “Silvaco” or the “Company”), a provider of TCAD, EDA software, and SIP solutions that enable semiconductor design and digital twin modeling through AI software and innovation, today announced its first quarter 2024 results.

“Having successfully completed our IPO on May 13^th, we are excited to embark on our journey as a public company,” said Babak Taheri, Silvaco’s Chief Executive Officer. Dr. Taheri continued, “I am pleased with our first quarter results which were driven by strong demand for our TCAD and EDA products across various sectors. With our proven software platform, we continue to capitalize on organic growth opportunities and customer investments across multiple end markets.”

Commenting on the financial results and outlook, Ryan Benton, Silvaco’s Chief Financial Officer, added, “We achieved another quarter of stellar financial results including double-digit top-line growth and profitability. Based on our visibility and strong, predictable revenue model, we expect the momentum to continue into the second quarter. Moreover, following the completion of the IPO unaudited cash and cash equivalents was $104.2 million at the end of May 2024, allowing us to pursue our growth initiatives by means of both organic and inorganic opportunities.”

First Quarter 2024 Financial Highlights

• Strong TCAD and EDA quarterly revenues with a key strategic customer renewal in Japan and nine new customer wins, partially offset by lower Semiconductor IP (“SIP”) revenue. As previously disclosed, the NXP licensing agreement lapsed in the fourth quarter of 2023, but has since been extended as of April 2024. The lapse of the NXP licensing agreement impacted our IP revenues and bookings in the first quarter of 2024 but since reinstatement the Company has observed a significant resumption in SIP bookings. This contributes to the Company's estimate of total bookings growth of 18% to 29% for the second quarter of 2024.
• GAAP and non-GAAP gross margins for the first quarter of 2024 of 88%, up from 86% in the first quarter of 2023 and 79% in the fourth quarter of 2023. This increase was driven in large part by strong TCAD and EDA license revenue growth.
• GAAP operating expenses for the first quarter of 2024 were up 7% from a year ago and down 2% sequentially from the fourth quarter of 2023. Non-GAAP operating expenses for the first quarter were up 5% from a year ago and down 5% sequentially. The year-over-year increases in GAAP and non-GAAP operating expenses were due in part to increased research and development and sales and marketing staff costs offset by lower sales commissions expense.
• GAAP operating income and margin for the first quarter of 2024 of $2.4 million and 15%, up from $1.5 million and 11% in Q1 2023, respectively. Non-GAAP operating income and non- GAAP operating margin of $3.3 million and 21%, up from $2.1 million and 15% in Q1 2023.

First Quarter 2024 Financial Results

GAAP Financial Results

• Revenue of $15.9 million, up 27% quarter-over-quarter and up 11% year-over-year.
  • TCAD revenue of $10.6 million, up 21% year-over-year.
  • EDA revenue of $4.7 million, up 13% year-over-year.
  • SIP revenue of $0.6 million, down 57% year-over-year.
• GAAP gross margin of 88%, compared to 86% in Q1 2023.
• GAAP operating income and margin of $2.4 million and 15%, compared to $1.5 million and 11% in Q1 2023, respectively.
• GAAP net income of $1.4 million, compared to $0.8 million in Q1 2023.
• GAAP diluted net income per share of $0.07.
• As of March 31, 2024, cash and cash equivalents totaled $5.7 million.

Key Operating Indicators and Non-GAAP Financial Results:

• Gross bookings were $16.1 million, up 3% year-over-year.
• Remaining performance obligations as of March 31, 2024, were $29.1 million, 49% of which is expected to be recognized as revenue in the next 12 months.
• Non-GAAP operating income and non-GAAP margin of $3.3 million and 21%, compared to $2.1 million and 15% in Q1 2023, respectively.
• Non-GAAP net income of $2.4 million, compared to $1.9 million in Q1 2023.
• Non-GAAP diluted net income per share of $0.12.

For a discussion of the non-GAAP metrics presented in this press release, as well as a reconciliation of non-GAAP metrics to the nearest comparable GAAP metric for Silvaco's first quarter 2024, fourth quarter 2023 and first quarter 2023 results, see “Discussion of Non-GAAP Financial Measures” and “GAAP to Non-GAAP Reconciliation” in the accompanying tables below.

First Quarter 2024 and Recent Business Highlights

• Introduced artificial intelligence-based platform for digital twin modeling named fab technology co-optimization, or FTCO™, for wafer-level fabrication facilities. FTCO™ uses manufacturing data to perform statistical, AI and physics-based machine learning software simulations to create a computer model or ‘digital twin’ of a wafer that can be used to simulate the fabrication process and yield. Customers can utilize this model to run simulation experiments to understand and enhance wafer yield without the need to run physical wafers, which can be time-consuming and expensive. The company estimates that the market opportunity for this technology represents a serviceable addressable market in excess of $500 million.
• Announced an enhanced partnership with Micron Technology, Inc. (Nasdaq: MU) (“Micron”), which included expanding the partnership for FTCO™ and securing a $5.0 million investment from Micron in the form of a senior subordinated convertible promissory note, which subsequently converted into common stock at the completion of the IPO.
• Announced extension of Technology License and Distribution Agreement with NXP, which extended the term of the SIP licensing agreement for an additional five years beginning from April 1, 2024.
• Priced and closed an IPO of 6,000,000 shares of Silvaco common stock at a price to the public of $19.00 per share. Net proceeds to the company from the IPO were approximately $106 million after deducting underwriting discounts and commissions. The shares began trading on the Nasdaq Global Select Market under the ticker symbol “SVCO” on May 9th, 2024.

Supplementary materials to this press release, including our first quarter 2024 financial results, can be found at https://investors.silvaco.com/financial-information/quarterly-results.

Second Quarter and Full Year 2024 Financial Outlook

As of June 20, 2024, Silvaco is providing guidance for its second quarter of 2024 and its full-year 2024, which represents Silvaco’s current estimates on its operations and financial results. The financial information below represents forward-looking financial information and in some instances forward-looking, non-GAAP financial information, including estimates of non-GAAP gross margin and non- GAAP operating income. GAAP gross margin is the most comparable GAAP measure to non-GAAP gross margin, and GAAP operating income is the most comparable GAAP measure to non-GAAP operating income. Non-GAAP operating income differs from GAAP operating income in that it excludes items such as certain transaction-related costs, IPO preparation costs, acquisition-related litigation costs, stock-based compensation, amortization of acquired intangible assets, impairment charges and executive severance costs. Silvaco is unable to predict with reasonable certainty the ultimate outcome of these exclusions without unreasonable effort. Therefore, Silvaco has not provided guidance for GAAP gross margin or GAAP operating income or a reconciliation of the forward-looking non-GAAP gross margin or non-GAAP operating income guidance to GAAP gross margin or GAAP operating income, respectively. However, it is important to note that these excluded items could be material to our results computed in accordance with GAAP in future periods.

Based on current business trends and conditions, the Company expects for second quarter 2024 the following:

• Revenue in the range of $14.3 million to $15.0 million, which would represent a 14% to 20% increase from the second quarter of 2023.
• Gross bookings in the range of $17.0 million to $18.5 million, which would represent a 18% to 29% increase from the second quarter of 2023.

• Non-GAAP gross margin to be in the range of 85% to 87%.
• Non-GAAP operating income in the range of $0.5 million to $1.5 million, which would represent a 62% to 185% increase from the second quarter of 2023.

For full year 2024, the Company expects: