Last week, you might have seen that SkyWater Technology, Inc. (NASDAQ:SKYT) released its third-quarter result to the market. The early response was not positive, with shares down 9.1% to US$8.80 in the past week. It looks like a credible result overall - although revenues of US$94m were what the analysts expected, SkyWater Technology surprised by delivering a statutory profit of US$0.03 per share, instead of the previously forecast loss. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for SkyWater Technology

Taking into account the latest results, the four analysts covering SkyWater Technology provided consensus estimates of US$329.1m revenue in 2025, which would reflect a noticeable 4.9% decline over the past 12 months. Losses are expected to be contained, narrowing 13% from last year to US$0.30. Before this latest report, the consensus had been expecting revenues of US$378.1m and US$0.17 per share in losses. There's been a definite change in sentiment in this update, with the analysts administering a notable cut to next year's revenue estimates, while at the same time increasing their loss per share forecasts.

There was no major change to the consensus price target of US$11.88, signalling that the business is performing roughly in line with expectations, despite lower earnings per share forecasts. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic SkyWater Technology analyst has a price target of US$15.00 per share, while the most pessimistic values it at US$8.50. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 3.9% by the end of 2025. This indicates a significant reduction from annual growth of 23% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 19% per year. It's pretty clear that SkyWater Technology's revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts increased their loss per share estimates for next year. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. The consensus price target held steady at US$11.88, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on SkyWater Technology. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple SkyWater Technology analysts - going out to 2026, and you can see them free on our platform here.

It might also be worth considering whether SkyWater Technology's debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.