On November 12, 2024, QuickLogic Corp (QUIK, Financial) released its 8-K filing detailing its financial results for the fiscal third quarter ending September 29, 2024. QuickLogic Corp, a fabless semiconductor company, specializes in providing programmable silicon and software platforms, including embedded FPGA (eFPGA) intellectual property (IP), low power, multi-core semiconductor system-on-chips (SoCs), discrete FPGAs, and AI software. These offerings cater to various markets such as Aerospace, Defense, Consumer/Industrial IoT, and Consumer Electronics.
Financial Performance Overview
QuickLogic Corp reported total revenue of $4.3 million for Q3 2024, surpassing the analyst estimate of $4.20 million. However, the company posted a GAAP net loss of ($2.1 million), or ($0.14) per share, which fell short of the estimated earnings per share of -$0.10. This performance highlights the challenges QuickLogic faces in maintaining profitability amidst fluctuating market conditions.
Revenue and Product Insights
The company's revenue for the third quarter decreased by 35.9% compared to the same period in 2023 but showed a 3.5% increase from the previous quarter. New product revenue was approximately $3.5 million, marking a 42.0% decline year-over-year, primarily due to the timing of deliverables for large eFPGA IP contracts. Mature product revenue stood at $0.7 million, reflecting a slight increase from the previous year but a decrease from the second quarter of 2024.
Gross Margin and Operating Expenses
QuickLogic's GAAP gross margin for Q3 2024 was 55.8%, a significant drop from 76.9% in Q3 2023, though it improved from 51.0% in Q2 2024. The non-GAAP gross margin was reported at 60.0%. GAAP operating expenses increased to $4.2 million from $3.8 million in the previous year, while non-GAAP operating expenses remained steady at $3.3 million.
Strategic Developments and Industry Position
QuickLogic continues to advance its strategic initiatives, including the execution of the third tranche of the Strategic Radiation Hardened FPGA Technology US Government contract and the delivery of eFPGA IP for GlobalFoundries' 12LP process and TSMC's N12e 12nm process. The company is also developing an eFPGA Hard IP core for Intel's 18A process, expected to be delivered by year-end 2024.
“We are on schedule to close 2024 with eFPGA Hard IP delivered for a total of six fabrication processes,” said Brian Faith, CEO of QuickLogic. "With these completed, we are in a position to capitalize on the growing number of inquiries we are seeing, and complete IP license deliverables for these fabrication processes quickly and with notably lower expenses thanks to our Australis eFPGA Hard IP Generator."
Balance Sheet and Cash Flow
As of September 29, 2024, QuickLogic reported total assets of $49.7 million, with cash and cash equivalents amounting to $22.4 million. The company's total liabilities stood at $28.8 million, resulting in a stockholders' equity of $20.9 million. These figures indicate a stable financial position, although the company faces challenges in improving its cash flow and reducing its net loss.
Conclusion and Industry Implications
QuickLogic Corp's Q3 2024 results reflect the ongoing challenges in the semiconductor industry, including fluctuating demand and the timing of contract deliverables. While the company has made significant strides in strategic partnerships and product development, the financial results underscore the need for continued focus on cost management and revenue growth. The semiconductor industry remains highly competitive, and QuickLogic's ability to innovate and adapt will be crucial for its future success.
Explore the complete 8-K earnings release (here) from QuickLogic Corp for further details.
