QUIK Q1 2025: Intel 18A Test Chip De-risks Licensing, Royalties
- Unique Market Leadership in Intel 18A eFPGA Technology: The Q&A emphasizes that QUIK is the only provider of eFPGA Hard IP for Intel 18A, with proven test chips that de-risk the technology and build strong customer confidence for near-term IP licensing and future royalties.
- Compelling Value Proposition for Defense & Commercial Markets: Executives described how integrating embedded FPGA into ASIC/SoC designs reduces qualification, verification, and SWaP-C costs—benefits that resonate with both defense industrial base clients and low-power edge application markets, setting the stage for higher-value contracts.
- Robust Storefront & Licensing Revenue Pipeline: Multiple discussions highlighted the expansion into direct-to-storefront opportunities and strategic Rad-Hard contracts, indicating a trend toward recurring licensing and royalty revenues that could drive a strong revenue ramp in the latter half of the year.
- Reliance on delayed Intel 18A revenue conversion: Management’s discussion indicates that revenue from Intel 18A is not immediate, with production license and subsequent royalty revenue expected to materialize later in the year or even next year. This reliance on test chips and extended ramp-up introduces significant execution risk.
- Uncertainty in storefront revenue timing: Executives were hesitant to disclose specific timelines for storefront revenue, suggesting that expected revenue from these engagements remains uncertain and could be delayed, impacting overall revenue growth.
- Extended development cycles and concentrated contract dependencies: The company’s revenue growth hinges on winning and executing large IP contracts and navigating long qualification cycles—especially in defense and advanced technology markets—which may delay cash flow or reduce near-term revenue visibility.
| Metric | Period | Previous Guidance | Current Guidance | Change |
|---|---|---|---|---|
Revenue ($USD Millions) | Q2 2025 | Approximately $4 million, plus or minus 10%. Includes ~$3.4 million in new products and ~$0.6 million in mature products | Approximately $4 million, plus or minus 10%. Composed of ~$3.4 million in new products and ~$0.6 million in mature products | no change |
Non-GAAP Gross Margin (%) | Q2 2025 | Expected to be approximately 50%, plus or minus 5 percentage points | Approximately 50%, plus or minus 5 percentage points. Lower gross margin due to unfavorable absorption of fixed costs | no change |
Non-GAAP Operating Expenses ($USD Millions) | Q2 2025 | Expected to be approximately $3.2 million, plus or minus 5% | Approximately $3.0 million, plus or minus 5% | lowered |
Non-GAAP Net Loss ($USD Millions) | Q2 2025 | Forecasted to be approximately $1.2–$1.4 million, or $0.07–$0.09 per share | Approximately $1.1–$1.2 million, or $0.07–$0.08 per share | lowered |
Stock-Based Compensation ($USD Millions) | Q2 2025 | Expected to be approximately $0.9 million | Approximately $0.9 million, consistent with Q1 2025 and up $100,000 from Q2 2024 | no change |
Cash Flow from Operations | Q2 2025 | Highly dependent on timing of certain large contracts; confident of being cash flow positive in Q2 and for full year 2025 | Anticipated to be relatively flat. Payments to subcontractors for the SRH contract expected to be ≈50% lower than in Q1 2025 | lowered |
| Topic | Previous Mentions | Current Period | Trend |
|---|---|---|---|
Intel 18A eFPGA Technology Leadership | Discussed consistently in Q2, Q3, and Q4 2024 with emphasis on being the first-to-market, strong leadership, and noted revenue timing risks due to funding delays | In Q1 2025, the company reaffirms its leadership and unique market position but highlights further revenue timing delays and a lower early-quarter revenue guidance, while maintaining a robust full‐year outlook | Recurring optimism about technology excellence with persistent short-term revenue timing challenges. |
Storefront and Licensing Revenue Pipeline Opportunities | In Q2–Q4 2024, substantial focus was given to a growing pipeline, detailed storefront contracts, and associated execution uncertainties; the guidance noted that opportunities (including chiplet and licensing deals) were critical though subject to delays | In Q1 2025, secured storefront contracts and ongoing pipeline opportunities are highlighted, though execution uncertainty remains a concern as revenue from key opportunities is delayed to later quarters | Consistently high potential with execution risks that persist across periods. |
Delayed Contract Awards and Extended Development Cycles | Across Q2, Q3, and Q4 2024, delays in contract awards—partly stemming from expanded technical scopes and funding issues—pushed revenue recognition into later quarters, impacting near-term forecasts | In Q1 2025, a significant delay (notably in an Intel 18A IP contract) is cited as the reason for reduced Q2 revenue guidance, though long-term prospects remain intact | A recurring short‐term headwind that consistently postpones revenue even as long‐term outlook stays positive. |
Reliance on Defense, Government, and Industrial Contract Dependencies with Emerging Commercial Market Expansion | Q2–Q4 2024 calls consistently discussed heavy reliance on defense/government and industrial contracts, while also noting strategic moves into commercial applications (e.g. partnerships like Faraday and targeting Intel 18A commercial markets) | Q1 2025 maintains the dual narrative: continued dependency on traditional defense and government contracts alongside active expansion into emerging commercial markets | Stable reliance on traditional sectors coupled with ongoing diversification into commercial markets. |
Market Consolidation and Competitive Positioning Following the Flex Logix Acquisition | Highlighted in Q3 and Q4 2024 with detailed discussion of the void left by Flex Logix’s exit, positioning QuickLogic as the sole eFPGA Hard IP provider, supported by strategic hires and positive customer inquiries | This topic is not mentioned in Q1 2025, suggesting it is either considered resolved or less of a focus now. | Previously a strong focus that appears de‐emphasized in the current period. |
Reduced Sales Funnel Transparency and Shifts in Quantitative Metrics Disclosure | While Q2 and Q3 2024 included detailed funnel metrics, Q4 2024 marked an explicit announcement to reduce quantitative disclosures in favor of contract milestones | Q1 2025 does not reference this topic, indicating it may have been absorbed into broader financial commentary. | A topical shift in disclosure strategy introduced in Q4 2024 that is no longer separately discussed. |
Financial Guidance Adjustments, Lower Growth Projections, and Negative Cash Flow Concerns | All Q2–Q4 2024 calls mentioned adjustments in revenue guidance and lowered growth expectations due to delays and higher cash usage, though long-term profitability and cash flow positivity were reaffirmed | In Q1 2025, the company reiterates a lower Q2 revenue guidance and lower short-term growth projections, while maintaining expectations for full-year profitability and a cash flow rebound starting in Q2 | A consistent theme of short-term caution with an optimistic long-term outlook; near-term concerns remain while strategic measures are in place. |
Emergence and Subsequent Diminution of Chiplet Revenue Opportunities | Q2 2024 showcased emerging opportunities with a significant funnel (including a $40M potential tied to chiplet proposals) while Q3 2024 noted that two chiplet proposals were not selected, reducing funnel value; Q4 2024 mentioned growing interest without emphasizing diminutions | Q1 2025 does not explicitly discuss chiplet revenue opportunities, possibly indicating a reduced focus or consolidation of earlier mixed signals. | Chiplet opportunities emerged strongly but encountered setbacks in Q3 2024; the absence in Q1 2025 may signal a temporary de-prioritization or strategic integration of the channel. |
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Intel 18A Ramp
Q: How is Intel 18A ramp affecting revenue?
A: Management explained that delivering design-specific eFPGA Hard IP on Intel 18A for test chips has de-risked production, setting up IP license revenue now and royalties later from both defense and commercial customers. -
Rad-Hard Timing
Q: When will rad-hard storefront revenue appear?
A: They indicated the strategic rad-hard contract has a multi-year development timeline—with storefront revenue expected to emerge as the design matures, likely in Q4 or later. -
Storefront Pipeline
Q: What additional storefront opportunities exist?
A: Besides the direct-to-storefront win and the tape-out customer from November 2022, management noted several government RFPs and chiplet ecosystem engagements reinforcing future licensing and royalty revenue. -
USMAG Market
Q: Is the $1.5B FPGA market solely Intel 18A?
A: They clarified that the $1.5 billion represents the total annual discrete FPGA revenue in USMAG designs—not just Intel 18A—which underscores the broader opportunity for integrated solutions. -
Faraday Go-to-Market
Q: Will Faraday lead the sales process?
A: Management stated that Faraday will be the primary interface with system companies, while QuickLogic supports with design-specific IP and training, rather than managing direct sales. -
Faraday End Markets
Q: What end markets are targeted by Faraday?
A: Faraday’s development efforts are aimed at low-power, industrial, and IoT applications, where the integration of embedded FPGA into SoCs enhances performance and energy efficiency. -
Test Chip Value
Q: Does the test chip prove scalable performance?
A: Management confirmed that the successful test chip validated key metrics like power, timing, and die size, demonstrating that once these parameters are proven, scaling to larger arrays is straightforward.