QUICKLOGIC Corp Q4 FY2024 earnings call

• Contract Wins: Secured a $1.1 million eFPGA Hard IP contract with a new DIB customer, first phase of a seven-figure Direct to Storefront eFPGA Hard IP contract, and the fourth tranche of the Strategic Radiation Hardened FPGA government contract valued at ~$6.6 million. Anticipates Intel 18A eFPGA Hard IP contracts to be awarded soon with combined mid-seven figure value. • eFPGA Developments: Have eFPGA Hard IP established for multiple fabrication processes, including Intel 18A, and expect to expand to 9-10 processes in 2025. Aurora software updates, including version 2.9, 2.9 Pro integrating Synopsys Synplify, with version 3.0 coming soon. • Distributors: New distributors are executing well, more than doubling the value of design opportunities. • SensiML: Board of Directors exploring options for SensiML, with due diligence ongoing and no contribution to full-year outlook.

In the fourth quarter of 2024, total revenue was $5.7 million. New product revenue was $4.7 million, and mature product revenue was $1.0 million. For the first quarter of 2025, revenue guidance is approximately $4 million, plus or minus 10%, with approximately $3.4 million in new products and $0.6 million in mature products. New product revenue contributes a larger portion, while mature product revenue is a smaller component.

• Q1 2025 revenue guidance is approximately $4 million, plus or minus 10%, lower than anticipated due to delay of certain large IP contracts. • Anticipate significant rebound in revenue and profitability beginning in Q2 2025. • Full-year 2025 expected to have solid revenue growth, non-GAAP profitability, and positive cash flow. • Q1 non-GAAP gross margin expected to be ~50% ±5%, full-year non-GAAP gross profit margin in mid-60% range. • Non-GAAP operating expenses expected to be ~$3.2 million ±5% for Q1 2025, ~$3.3 million per quarter in 2025.

• Forward-looking statements involve risks and uncertainties, including differences between actual results and discussions. • Risks related to audit still underway, which could materially affect results. • Risks regarding revenue from new and mature products, timing of government contract payments, market acceptance of customers' products, schedule changes, and future performance and financial expectations.

Q: What's the outlook for Q2 2025 given the Q1 guidance?

A: The $1.1 million contract and Intel 18A contracts (mid-seven figure) are expected to be recognized in Q2, leading to revenue north of $6 million, with non-GAAP profitability and cash flow positive.

Q: How soon can we expect FlexLogix prior licensees to convert to QuickLogic designs?

A: It's a shorter timeframe, with the $1.1 million win being one Andy Jaros helped close, leveraging his prior experience at FlexLogix.

Q: How does diversification of end markets work with process nodes?

A: Already seeing opportunities outside aerospace and defense, with industrial, communications, and consumer markets emerging, driving new process technology ports.

Q: Elaborate on FPGA use in AI inferencing by a customer?

A: Collaborated with ETH Zurich on joint research showing energy savings with embedded FPGA for AI inferencing, with a customer using this for edge AI inferencing applications.

Q: Revenue patterns in the second half of 2025?

A: Driven by embedded FPGA IP contracts, strategic Rad-Hard FPGA, and newer IP cores on advanced process technology with higher ASP, leading to better gross profit margin and cash flow due to reduced operating expenses for customer-specific derivatives.