MRAM - Earnings call transcript Q3 2024 | Everspin Technologies, Inc.

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Operator

Good afternoon, and welcome to Everspin Technologies Third Quarter 2024 Financial Results Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded.

I would now like to turn the conference over to Cathy Patterson, Investor Relations for Everspin.

Cassidy Fuller

Thank you, operator, and good afternoon, everyone. Everspin released results for the third quarter 2024 ended September 30, 2024, this afternoon after market close.

Relations Investor Patterson, Cathy for Everspin. I'm me and Chief with Financial on Tenorio, today's President Aggarwal, Officer. Sanjeev are Executive Chief call Interim And Officer; Matt and

that statements. statements company's may would factors review filings report forward-looking We investing the annual made to you would executing begin in customer future in SEC to of regarding and and except MRAM obligation Everspin's but the or of to as call, future we to, including, as may this technology, result I are law, company industry whether Everspin. limited discuss expectations Before remind this forward-looking time adoption the events, you future Form to including call, successfully information, goals, which any forward-looking no company's today's by XX-K undertakes the not other statements the and on encourage business, discussion contain performance like the and for financial and of call, its products on and in and actual the Everspin's These company otherwise. from or differ statements from risk made cause bringing made statements in and SEC required alter a business forward-looking involve results on may to with market forward-looking materially of pipeline plan. those filings, and manufacturing estimates, design judgments, market risks the on are based contained associated to All events that new current time update date uncertainties trends as conditions

hereof that from procedures, adjustments time company's results its these completion available by are now financial financial period are and as result other of as results closing the finalized. and reflect this and external to developments further and information review results final the the between the discussed for auditors. estimates may and a today arising based of subject estimates materially differ financial preliminary The The are company's of actual the date Everspin on the

of the in measures in Additionally, of during and adjusted measures made income discussion release certain the certain material and net which Included will additional include non-GAAP GAAP EBITDA, details. information provide press of company's release press definitions -- are terms. financial company's reconciliations statements to GAAP and this call and

the is A release copy on section of at Investor Everspin's press www.everspin.com. the website Relations posted of

And Everspin's President CEO, Sanjeev now call ahead. to Sanjeev, I'd Aggarwal. please like turn to over the go and

Sanjeev Aggarwal

the Thank you, and call for Cassidy, joining on thanks, everyone, us today.

SUV. ahead our X We million, for and EPS the FCMX, quarter strong including ended our and of to are were Gravity our with guidance of Toggle-MRAM during wins range. selection a the a revenue Contributing for selection our to PERSYST with We guidance of PERSYST third of the results $X.XX or report FlashCore quarter, Lucid pleased our quarter cash Module of of line the our the with sheet, $XX.X in balance the key number million. including STT-MRAM $XX.X IBM gigabit X of results

DoD and Everspin quarter, with our contractor breadth and business of and that contracts Frontgrade Department the a key or notably the most of our a advancements Defense portfolio. number had of demonstrates strength new product during of

revenue by in discussing other revenue recognize before new start for potential. I'll wins with quarter which products the projects discussing and future we

X gigabit STT-MRAM Everspin's the that data center is This X-gigabit During FlashCore the sale and the started our Module revenue third of quarter, IBM's receive featured generation of or for STT-MRAM orders into has for solution. recognize FCMX to X IBM's we began to fourth PERSYST FCM applications.

per delivers a solution X.X PERSYST Our and of both with interface. and read second write gigabytes non-volatility coupled bandwidth, DDRX-like

years. for approximately this the next for parts provide to expect line X We product

sequential decrease consumption in its We inventory observed at its and distributor with Toggle-MRAM our signs PERSYST wins revenue to continued in product modest a design inventory. of Everspin see products. growth our and customers

customer pleased XXX remain to Based our megabit to production our year are STT-MRAM and PERSYST continue design to We ongoing of optimistic traction also XXXX. products. about megabit into on additional continued strong X our we ramping PERSYST product line discussions, wins expect with share with later our go adoption in STT-MRAM this to the revenue

As family production this memory product reminder, to in year was and the the persistent solution highest a brought is last performing industry.

patent royalty, licensing, our to revenue. Turning and other

and August. we to using mentioned develop a Under working contract new began with million are for STT-MRAM revenue Frontgrade embedded $X.XX announced radiation-hardened we current will and this solutions Frontgrade of support our that this optional earlier, radiation-hardened future Orbital PERSYST first custom initial of of with award completion I Technologies we This technology. systems. contract the or contract, from the allows Upon As phases. strategic to the recognize in macro for Earth project, successful DoD future Low STT-MRAM the deal space LEO phase

in As engaged other our are noted we previous we on STT-MRAM that X calls, RAD-Hard technology. programs use

STT-MRAM strategic focused and a second project, building The is FPGA. an to XX-megabit hoc RAD-Hard first the on program relates ad

internal both to We are to revenue. we pleased for RAD-Hard phases their that hit remain on milestones quarter programs as to both track third our next programs respective recognize move share and

royalty we our have customers addition, licensed recognize revenue In that of the and sensors. in our from TMR to STT-MRAM field IP continue

Turning item. to below-the-line

X.X aerospace facility a the MRAM quarter. later capabilities DoD MRAM provide received will plan other in sustainment Matt and manufacturing for During a to the to customers. award being their third during third a from onshore continuous million contractor as in remarks. is next quarter, to years benefits recognized his award This began the $XX.X develop award our explain for income, We we of defense the recognize this to

Now to that Gravity PERSYST future recently that our has Motors QXXX Last Grade the it specification Celsius degrees month, in discuss to AEC Lucid will recent quarters. in of of began to next minus MRAM on MRAM selected our and clear is XX the the degrees Toggle continue that MRAM our a I win we for expect design demanding consumer This depending reception revenue products X performance We meets demonstration product the to to and SUV awards to in use selected plus this support reliability XXX operation. our to announced recognize SUV. during its some Lucid project because X the contribute for Celsius marketplace. revenue would environments. like released in the of third approximately years ship prototypes of for temperature deliver quarter our

collaboration ], University, hardware This also artificial in Silicon or program are provide pleased technology its unique Everspin read We efficient solutions. to the fast margins optimized project, hardware Microelectronics switching will project state-of-the-art artificial Microelectronic MRAM the Commons to computing and Cheetah to with fabrics. support Commons energy-efficient through SCMC intelligence, share for collaboration for capabilities designing hardware STT-MRAM [ Purdue with or advance that won will leverage for hub. we in plus Crossroads intelligence CMOS a AI of in-memory the high energy-efficient MRAM

$XX in STT-MRAM one In million be Applied fabricate of contributors contributors. and QX from of years to projects of the We all total across X recognizing will one Institute, addition, Everspin to Research several the were Everspin expertise will to X 'XX. distributed to start revenue receive is over and a deploy project, reliable we expect arrays. to receive its this manufacturing funding project the

the global support continue ecosystem to SEMICON capabilities and in West had cars. to sector. Chiplet opportunity our chiplet of automotive attendance manage of we of Automotive ongoing our amounts companies automotive Forum. our planned we this the in events jointly we market The chiplets Through these the coming that complemented believe July, at our discussions, the how to growth from inevitable a the evolution conversations vast for of will and discuss data about the event This enhance our STT-MRAM the key to ecosystem architectures the Earlier EVs in this over attended tackle month, automotive chiplets brought We with generate. where players STT-MRAM number together the towards years. expand development meaningful

for step first then the would across chiplets and in mentioned manages that the interface the As past, on this data the alignment protocol interface. the be a

see years. next to over the X expect We these addressing chiplets applications

reminder, part the our currently a of code in memory data phase. solutions, is which Unisys chiplet the are unified As design and

sensor a The progressing agreement a to first on foundry meet expect silicon, from based milestones. into in strategic we the our and sensor provider of is entered schedule line TMR Chandler having with well and for on MRAM to discussed services we generation results device leading facility. quarter, provide our QX latest project the Last devices our customers'

nonrecurring to recognize qualification. for We or NRE engineering helping the expect with revenue

revenue. their be expect also stream from royalty We to our recognize revenue in initial starting QX revenue production This and licensing recognized in foundry order. will

conversations we for quarter, have STT-MRAM third we coming believe the continue persist the meaningful design turn products wins into customers, with additional will to over During our quarters. which

the to development start working on to Microelectronics excited STT-MRAM particularly AI are deploy energy-efficient solutions. for of Commons We project the

XXXX Matt CFO, third interim will financials through turn Matt? guidance. quarter it will fourth and our to over take I who quarter you our now Tenorio,

Matthew Tenorio

Thank you, afternoon, everyone. Sanjeev, good and

with million, compared $XX.X $XX.X quarterly third For million XXXX. quarter, sales $XX.X quarter, a year-over-year MRAM the results third decline $XX.X our million due customer $X.X $X.X include of with STT-MRAM patent compared This revenue and million 'XX in RAD-Hard to deliver the Licensing, revenue, decline was we of revenue quarter million product our sales of and both in pleased to demand. revenue to QX are the in in in third to in in $XX.X due was which lower decreased a range quarter in to of million compared a guidance result and projects. of third royalties the $XX.X line timing QX to other decrease the to 'XX. to royalty, million product from Toggle million

Turning to gross margin.

our XXXX in of family quarter, to the GAAP quarter expenses to due and was third decrease Our our third decline in were down slight GAAP XXXX. STT-MRAM QX the OpEx million to expenses million deals. in a XX.X% xSPI for third revenue related The XX.X% new sales The product increase in for $X.X related RAD-Hard to operating margin to products. the compared largely from of licensing quarter gross was $X.X 'XX. was due

In achievement the recognize Due will and aerospace certain million obligations, long-term these tasks span performance August, and of and of we totaling technical payments defense line. X.X up segments. receive provide nature as payments time years. Sanjeev a a Everspin over upon other announced our as to mentioned, the the over for to award services strategic approximately develop a award, cash the may to manufacturing below the of deliverables $XX.X to Pursuant plan income we agreement to

was third share, of to the income award, net this range income $X.X primarily ahead recorded substantially EBITDA weighted on of the or of per company to third loss shares average $X.XX GAAP or quarter of XXXX. $X.X income net Driven $X.XX recorded $X.X to this diluted QX $X.XX by we million million third XXXX, compared award. diluted quarter $X.XX compares guidance share million based of quarter in 'XX. a million of XX of This to other our Adjusted in relating million diluted million $X.X outstanding. In per the $X of

on QX. Looking track positive remain to ahead, maintain income net in GAAP we

We of at the with that prior balance pleased of and remains are cash $XX.X $XX.X We from million, million our quarter ended up equivalents and cash the sheet debt-free. strong quarter. end the

continue was third $X.X million capital to next our we capital sufficient the ahead, is generated year. our Cash for for the meet to operations Looking requirements quarter. flow believe anticipated from

Turning now guidance. to

to Looking with will XXXX, flat quarter. product the be we believe of remainder revenue the essentially that third

in expect Taking Europe, in this revenue additional coming net to per and $XX of into signs we GAAP $XX recovery customers, breakeven and continue drive QX million $X.XX. consumption We range particularly inventory share in to million the these positive diluted consideration, between the to our quarters. income factors to of in of total demand expect and be see

customers pleased in progress the of are continued contracts. we with design new the with our we have summary, wins In form and made

scaling revenue. Going remain our converting wins committed we design and additional forward, to business to

Operator, for the now you open line may questions.

Operator

& first comes Company. Bolton Our Quinn question Instructions] from Needham with [Operator

Shadi Mitwalli

for Quinn on to This MRAM Bolton. off start onshore in like is strategic Shadi I'd Mitwalli the dialing award.

give income but if revenue? is other able you details versus Sorry recognized more missed I this, on guys getting in are actual this to why

Matthew Tenorio

the and squarely recognition revenue that. the decided performance not analyzed fit the contract question. ASC recognize our for XXX that the as other within you and of below it to it did found that, obligations Thank against Yes. and standard, Because the we income line. We have agreement

Shadi Mitwalli

nicely. follow-up ticked licensing then gross is Gross And though up margin question flat even relatively margin. on my revenue sequentially, was

So you I kept details guys give more what on was flat. margins can some if wondering

Matthew Tenorio

products, which we think the see the continue to Chandler fab Toggle demand effect of the lower through I our of facility. run

to move to as are we expect improve. we smaller against flowing having absorb with forward, amount costs that But fab. fixed the So units of through that that would a associated that we are facility

Operator

next question Craig-Hallum. from Our comes Richard Shannon with

Richard Shannon

going in I topic recording X to the here. questions follow me. on guess nonoperating DoD income I'm from the you're up of contract

quarter, otherwise? quantitatively much that's the And this kind ratably is quarter? you into then milestone-based every something all, can describe guidance or maybe for recognized of built how First your qualitatively fourth of or is

Matthew Tenorio

Thank you, Richard. Yes.

said, So as it for the revenue not of fit standard did accounting recognition. into I the criteria

However, principles X.X recognition some some we years recognize efforts the are ratably meaning in we that of using milestones on analyzed and the we by and are of revenue analogy, it over the agreement. the will laid out the based

Richard Shannon

So this? I I'm conservatism of hitting to some and is gross to trying get higher explain work categories the OpEx of or being here. kind and guidance help these this together guess the into all midpoint numbers either how there are here, equal the either in lower it to built things to guide to here fit see Or be that EPS the margins, seems here? Is just that dynamics trying implying those of

Matthew Tenorio

might it a combination both. of think be I

with in We other believe the might that had the that some with we we our continued that be STT-MRAM of contributing have mentioned strength. projects Sanjeev RAD-Hard those data contribution factored combined from DoD contributing that And have. are discussed. we what And center also we've agreement

Operator

Instructions] from [Operator And Group. Richard next with Shannon Capital our question comes Craig-Hallum

Richard Shannon

here. Well, lucky back get right in me, right. All jump I

-- maybe X see or you Let's or a question here. for Sanjeev,

I quarter, as quarter remarks, flat the product signs So fourth again his to word some [ whatever. But for MATSA is improvement you you being here products Last the of stabilization or talked inventory, in guidance, forget or quarter ] and that. And the build show flat much help should seeing going of cadence are us about kind mentioned this products here. revenues to growth can then do you prepared new understand that? how here. maybe you we to when see time? Maybe then of over necessarily help just those sequential dynamics layering expect kind help And in us PERSYST in doesn't

Sanjeev Aggarwal

Good question, Richard.

So STT-MRAM let the PERSYST we year. that last the brought to me product start with market

those you design We is products. with But know, see to XX continue wins months. XX from to project anywhere time that on the qualification as

line expect So we're product product see part of going from that I to in significant that in do but to revenue think some don't it QX, XXXX. see ramp we

Toggle we the MRAM QX revenue in signals a seeing very going products, And and It's far respect product the modest as as QX. the with X gigabit, that to built from to existing our difficult that are we're have the to growth just in very decipher.

Some are positive and some are not so positive.

built conservatism the plan some is there into So over here.

Richard Shannon

on peel there. may Any end way Europe on about weakness a dynamics talked seeing touching Japan comment. back where hit and been us -- where be I bit, think layer the Maybe Japan can past, you've the you some geography Maybe think some I last In currency kind you can markets, of that you're describe by in that help Sanjeev. one little this.

Sanjeev Aggarwal

to be well. through think in you've that Germany think turmoil Japan seems going continues seen discussed a to I some then in the Europe, I be as challenge. like past, So we've And

those our I are QX revenue So think impacting combined for profile well. as X

Operator

And Company. comes Needham next our from with question & Bolton Quinn

Shadi Mitwalli

address. a use This then family markets is more product different and maybe about guys the those technical question differences maybe products. lines MRAM's between specifically you of on of But cases the And clarify PERSYST, can Agilysys? Unisys and talk PERSYST

Sanjeev Aggarwal

give it can I Sure. a shot.

looking large to for family, writes of you're So it and the for the very PERSYST read and writes. looking think and is, way about number read you're fast a

degrees X the if X megabit. it's goes is family, family Toggle includes that's IBM or That larger which to persistence gigabit then XXX XX XX and XXXX. megabit which basically the from temperature our the writes to C brought that for inception to or product the that automotive, looking you're Modules. the XX STT-MRAM our And we've XXX that XX, we basically last anywhere to range, we MRAM example, family to XX grade. in since selling xSPI the operating includes minus our shipping are read it's It from XX to market in industrial the minus family. been is if So FlashCore new to XXth the and for PERSYST And year,

those products PERSYST logging data talking about and I where automotive was come writes industrial. of operating or characteristics they writes of could in the which or fast the have family, that be have into all and and So data number these range, then unlimited you and read read temperature

many looking not The and Unisys you're product so writes. basically for family is reads

flash that's was You're say, talking include looking is using advantage to million or SoC million that about okay? and of RAM, XXX That NAND technologies fast includes out the read compared the that my for, script, there only, flash resistive writes also okay? product. chiplets this And during let's other NOR for, and any to and Unisys family. read STT-MRAM writes. or even looking XX it X solutions the of I type you're So again, That or built-in includes type million

a Agilysys we still data in trying our a standby current environment. We're actually to And and fast SRAM. is just with ME project the an there. the STT-MRAM of about zero show a speeds logging, build forward-looking are where and we what we're that to getting we're excited started, can trying over Commons research match do really that to And talked Purdue and that's

backing automation up industrial like PERSYST you Now of PLC applications, should computers. think

casino think industry. and and gaming, of medical of can defense and think you can You gaming aerospace

to configuration intelligence, and And Agilysys, on Unisys going as should solutions the products, industrial memory the edge. also applications think the it's artificial automotive, AI there. you about with FPGA mostly For be over well

I but think lot can I for more is now. speak this it, think enough to I a

Shadi. take we further if have any So it can maybe, you offline, questions,

Operator

from next with comes Craig-Hallum. question Shannon our Richard And

Richard Shannon

and of detail for your model time? just you remarks you Maybe over what time, program. a mentioned you of about -- cetera? talk what bit touching contributions Any can over one Purdue just something your me, Sanjeev, of expect us to out here financial et more kind little about on prepared one sort the that of any question to this

Sanjeev Aggarwal

financial as contributions with the actually far contract over as So we Richard, time, Purdue. haven't signed the

looking And have as you concerned, already we to clearly. you're of can to product read that, going that from much because a our signal think far to the higher be reads, and So center build I write, you're the as And margin the one when transfer I visibility But edge learn to data around how looking technology the and don't is application. center. very are tune to for for fabric you AI going data the for about read-intensive be solutions. basically I fast thing output these to able it to it's for talk to a is know STT-MRAM -- got into then the

I we're think what out to this. is that of learn going

is product product the can solutions as lead a This concerned, go to any I that project of the about build not have talk we'll product think is learning to going to far and we today. As outside take project. and this

Operator

now at would no time. to turn for questions showing further to closing like this I'm Aggarwal I it Sanjeev remarks. back

Sanjeev Aggarwal

Halloween, wish talk are celebrating a that of at you want the of Diwali. that happy the I I you. to those Thank next Festival call. for again guys guys thank to celebrating Thank everyone and want to also Indian take happy the you are actually you you advantage Halloween, for call all you, also the today. And earnings those I operator, to Diwali. and of want joining

Operator

call. concludes participating. Thank for conference today's This you

You disconnect. may now

Everspin (MRAM) 30 Oct 242024 Q3 Earnings call transcript