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    POWER INTEGRATIONS (POWI)

    POWI Q3 2024: Targets 20% GaN Revenue in 2–3 Years via 1,700V Launch

    Reported on Jun 22, 2025 (After Market Close)
    Pre-Earnings Price$66.43Last close (Nov 6, 2024)
    Post-Earnings Price$68.58Open (Nov 7, 2024)
    Price Change
    $2.15(+3.24%)
    • Advanced GaN Product Positioning: The company’s recent 1,700‑volt GaN announcement targets high-voltage automotive (800‑ and 1,000‑volt systems) and industrial applications, offering higher efficiency and cost advantages over traditional silicon carbide solutions.
    • Robust GaN Revenue Growth Prospect: Executives project that GaN products could account for about 20% of revenues in the next 2–3 years and potentially exceed $100 million in GaN revenue by 2028, underpinning a strong, evolving portfolio as legacy products migrate to GaN.
    • Favorable Market Trends: The expansion into GaN is well aligned with long‑term macro tailwinds in renewables, EVs, and high‑voltage DC transmission, driving additional demand for advanced power solutions.
    • Weak Consumer Demand & Inventory Build-up: Q&A discussions highlighted that consumer demand, particularly in the appliance market, has been softer than expected. This is evidenced by customer inventory build-ups due to delayed or uneven Chinese stimulus incentives, which could pressure margins and future revenue.
    • Reliance on New GaN Adoption: Executives pointed to the transition toward GaN technology to replace legacy silicon. However, uncertainties around the pace of adoption and competitive pressure from silicon carbide—especially in high-voltage and high-power applications—pose risks to timely revenue growth.
    • Sequential Revenue Decline: Guidance for Q4 indicates lower sequential revenues, and Q&A remarks suggest that even though industrial may hold up, other segments are expected to decline, potentially impacting overall performance.
    1. GaN Revenue Outlook
      Q: Future GaN revenue share and targets?
      A: Management highlighted that legacy products are migrating to GaN, expecting it to comprise 20% of revenue in the next 2–3 years and aiming to exceed $100 million in GaN revenue by 2028.

    2. High-Power GaN Lead
      Q: How competitive is high-power GaN?
      A: They explained that at 750 volts GaN is nearing parity with silicon and is far more competitive than silicon carbide below 100+ watts, with advancements targeted over the next 3–5 years.

    3. 1,700V GaN Demand
      Q: What is the role of 1,700V GaN?
      A: The new 1,700-volt product is designed to support automotive systems (transitioning to 800–1,000 volt batteries) and industrial applications needing robust surge protection, offering efficiency advantages over silicon carbide.

    4. Inventory Impact
      Q: How are inventory levels affecting sales?
      A: Management noted that in the consumer segment, sell-through lagged behind sell-in, leading to channel inventories slightly above 8 weeks, while inventories in other segments returned to normal levels.

    5. Appliance Inventory
      Q: Was Chinese appliance inventory built ahead?
      A: They confirmed that strong earlier consumer demand led appliance customers to build up finished goods inventory in anticipation of varied government incentives, which eventually did not deliver the expected boost.

    6. Renewables Impact
      Q: Does the new administration affect renewables?
      A: Management expressed no concern, noting that renewable energy remains cost-effective compared to coal and that DC transmission is critical for offshore wind and electric vehicles, supporting continued demand.

    7. Segment Outlook
      Q: What is the Q4 revenue segment outlook?
      A: They predicted that while the Industrial segment would remain flat in absolute terms—thereby increasing its revenue percentage—other segments are expected to decline sequentially.

    Research analysts covering POWER INTEGRATIONS.