Sixth Straight Quarter of Record Revenue Culminates in 35% Growth Year for Fiscal 2023

BLOOMINGTON, Minn. — (BUSINESS WIRE) — February 26, 2024 — SkyWater Technology, Inc. (NASDAQ: SKYT), the trusted technology realization partner, today announced financial results for the fourth quarter and full fiscal year 2023 ended December 31, 2023.

Financial Highlights for Q4 2023:

• Revenue increased 22% year-over-year to a record $79.2 million.
• Gross margin decreased to 15.2% on a GAAP basis, compared to 25.4% in Q4 2022, and decreased to 17.4% on a non-GAAP basis, compared to 26.1% in Q4 2022.
• Net loss to shareholders of $10.3 million, or $(0.22) per share on a GAAP basis, and net loss to shareholders of $1.1 million, or $(0.02) per share on a non-GAAP basis, compared to net loss to shareholders of $3.0 million, or $(0.07) per share on a GAAP basis, and net loss to shareholders $1.5 million, or $(0.03) per share on a non-GAAP basis in Q4 2022.
• Adjusted EBITDA of $10.6 million, or 13.4% of revenue, compared to $10.3 million, or 15.9% of revenue in Q4 2022.

Financial Highlights for Fiscal Year 2023:

• Revenue increased 35% year-over-year to a record $286.7 million.
• Gross margin increased to 20.7% on a GAAP basis, compared to 12.2% in fiscal year 2022, and increased to 22.0% on a non-GAAP basis, compared to 13.7% in fiscal year 2022.
• Net loss to shareholders of $30.8 million, or $(0.68) per share on a GAAP basis, and net loss to shareholders of $7.7 million, or $(0.17) per share on a non-GAAP basis, compared to net loss to shareholders of $39.6 million, or $(0.97) per share on a GAAP basis, and net loss to shareholders $30.3 million, or $(0.74) per share on a non-GAAP basis in fiscal year 2022.
• Adjusted EBITDA of $37.2 million, or 13.0% of revenue, compared to $7.7 million, or 3.6% of revenue in fiscal year 2022.

“We are pleased to deliver a solid finish to fiscal 2023, with revenue growth exceeding our earlier expectations as a result of strong customer demand for our differentiated Advanced Technology Services (ATS) business,” commented Thomas Sonderman, SkyWater president and chief executive officer. “We are now entering a multi-year stage of increased levels of customer investments in our production capacity and capabilities, and we anticipate these investments will enable SkyWater to achieve another year of revenue growth in 2024. The continued robust demand for our ATS business demonstrates that our customers’ innovation investments remain strong.”

Recent Business Highlights:

• Significantly exceeded long-term growth targets in fiscal 2023, led by strong growth in ATS development revenue, which exceeded 50% year-over-year.
• Secured customer commitments for capital investment over the next several years, supporting continued year-over-year revenue growth ahead.
• Announced a Department of Defense award of up to $190 million for our Florida operation, reflecting the significant effort underway to expand advanced packaging capabilities domestically.
• Submitted our full CHIPS application during Q4, targeting modernization and equipment upgrades to enhance production at our Bloomington, Minnesota manufacturing facility.
• Continued momentum in bio-medical diagnostic applications culminated in the recent milestone announcement that Nautilus Biotech will be transitioning from ATS to Wafer Services for supply of its silicon-based microfluidic bio chips for proteome analysis.
• Our strategic business transformation initiatives of 2023 are enabling us to deploy a leaner and more efficient organization toward delivering consistent, continuous enhancements in productivity and output in our ATS business.

Q4 2023 Summary: