• Revenue: $13.1 million, above guidance range of $12 million to $13 million.
• Non-GAAP EPS: $0.02 per diluted share.
• MRAM Product Sales: $11.0 million.
• Licensing, Royalty, Patent, and Other Revenue: $2.1 million, down from $3.6 million in Q1 2024.
• GAAP Gross Margin: 51.4%, down from 56.5% in Q1 2024.
• GAAP Operating Expenses: $8.7 million.
• Non-GAAP Net Income: $0.4 million.
• Cash and Cash Equivalents: $42.2 million.
• Cash Flow from Operations: $1.4 million.
• Q2 2025 Revenue Guidance: $12.5 million to $13.5 million.
• Q2 2025 GAAP Net Loss Guidance: Between $0.05 loss and breakeven per basic share.
• Q2 2025 Non-GAAP Net Income Guidance: Between breakeven and $0.05 per basic share.

• Warning! GuruFocus has detected 4 Warning Signs with MRAM.

Release Date: April 30, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Everspin Technologies Inc (NASDAQ:MRAM) reported first-quarter revenue of $13.1 million, exceeding their guidance range.
• The company achieved a non-GAAP EPS of $0.02, surpassing expectations.
• Everspin continues to see strong product revenue, particularly from the PERSYST 1-gigabit STT-MRAM used in data center applications.
• The company is involved in significant projects with major automotive and aerospace clients, including Lucid Motors and Blue Origin.
• Everspin's balance sheet remains strong and debt-free, with cash and cash equivalents of $42.2 million.

Negative Points

• Licensing, royalty, patent, and other revenue decreased to $2.1 million from $3.6 million in Q1 2024.
• Gross margin decreased to 51.4% from 56.5% in Q1 2024 due to a lower mix of high-margin licensing revenue.
• The company anticipates a non-GAAP net loss per basic share between $0.05 and breakeven for Q2 2025.
• Everspin's revenue is expected to be more heavily weighted towards the second half of 2025, indicating potential short-term challenges.
• There is uncertainty regarding potential tariff impacts, particularly concerning products manufactured in the US and shipped to China.

Q & A Highlights

Q: Can you explain the potential impact of tariffs on your second-quarter guidance, especially concerning China? A: William Cooper, Chief Financial Officer, explained that while some wafers are sourced from GlobalFoundries in Germany and others from the US and Taiwan, direct sales to China are minimal. Therefore, the impact of tariffs is expected to be low. Most products are assembled in Taiwan, and the importer would be responsible for tariffs.

Q: Are you seeing signs of a cyclical recovery in the industrial segment of your business? A: William Cooper, Chief Financial Officer, confirmed that there are signs of improvement in backlog and traction on STT-MRAM products, indicating a potential cyclical recovery in the industrial segment.

Q: Can you provide insights into the gross margin dynamics and expectations for the rest of the year? A: William Cooper, Chief Financial Officer, noted that the gross margin was consistent between Q4 and Q1 at around 51%. He expects this consistency to continue throughout the year, maintaining a 50-plus gross margin.

Q: What factors are contributing to the expected second-half weighting of revenue in 2025? A: Sanjeev Aggarwal, President and CEO, mentioned that the backlog is building up, and there is a conversion of design wins into early production for STT products. This, along with the bottoming out of inventory correction, supports the expectation of higher revenue in the second half of 2025.

Q: How should we view operating expenses for the rest of the year? A: William Cooper, Chief Financial Officer, indicated that operating expenses are expected to remain in the same range throughout the year, with some product development work contributing to the expenses.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.