Silicom Ltd. Q1 FY2026 earnings call

Liron Eizenman noted strong Q1 2026 results with revenues at $19.1M, +33% YOY. Q2 revenues expected $20M - $21M (+40% YOY), full-year 2026 revenues $82M - $83M (+33% YOY). 4 design wins achieved out of 7-9 target for 2026. Highlighted recent design wins with global networking/security-as-a-service leader, Tier 1 cybersecurity customer, global streaming service provider, and European advanced encryption firm. Invested in 3 venture-style opportunities: AI inference, post-quantum cryptography, white-label switching.

First quarter of 2026 revenues were $19.1 million, up 33% year-over-year. Geographical revenue breakdown over last 12 months: North America 76%, Europe and Israel 14%, Far East and rest of the world 10%. Gross profit was $5.7 million, gross margin 30% vs. $4.4 million and 30.3% in Q1 2025. Operating expenses $7.6 million vs. $6.7 million in prior year. Balance sheet strong with $109 million in working capital and marketable securities as of Mar 31, 2026.

Q1 2026 revenues $19.1M, +33% YOY, exceeded guidance. Q2 revenues expected $20M - $21M (+40% YOY). Full-year 2026 revenues $82M - $83M (+33% YOY). 4 design wins achieved out of 7-9 target for 2026.

Risks related to memory chip supply lead times, requiring close collaboration with DRAM and storage vendors, balancing different suppliers, and communicating with customers about the situation.

Q: Ryan Koontz asked about timing, core business momentum, competitive advantage in AI and encryption, and memory supply.

A: Liron Eizenman explained that current momentum from core business, design wins from prior years ramping up, Silicom's experience in encryption, competitive edge in FPGA for AI inference, and efforts to manage memory supply risks.

Q: Gregory Weaver inquired about revenue timing for inference and details on the new inference specific product.

A: Liron Eizenman stated significant inference revenue likely in 2027, and the new product is with one of the two referenced key customers.