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Silvaco Group, Inc. (SVCO)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 was a soft quarter: revenue $12.05M, down 19% YoY and 15% QoQ; GAAP gross margin 71% and non-GAAP gross margin 76%; non-GAAP diluted EPS $(0.16), all below prior-year levels and at the low end of Q1 guidance range .
  • Mix shift was constructive: EDA and SIP grew YoY (+15% and +11%), while TCAD declined 34% YoY; bookings were $12.9M (−34% YoY) and RPO ended at $36.4M (50% to be recognized in next 12 months) .
  • Q3 2025 guidance introduced a sharp rebound: revenue $14.0–$18.0M, non-GAAP GM 81–85%, and non-GAAP diluted EPS $(0.12) to $0.02; FY25 guidance was maintained (revenue $64–$70M) .
  • Strategic M&A remained the narrative: completion of Mixel adds an estimated $110M to SAM; management targets revenue synergies in 2H with initial PPC and TechX contributions already embedded, while cost/tax synergies to follow .

What Went Well and What Went Wrong

What Went Well

  • EDA and SIP momentum: EDA revenue +15% YoY to $3.4M; SIP +11% YoY to $1.8M (offsetting part of TCAD weakness) .
  • ACV growth and backlog health: TTM ACV up 26%; RPO $36.4M with 50% within 12 months, supporting 2H revenue visibility .
  • Strategic expansion: “We estimate that we have expanded our SAM by another $110 million… in addition to the estimated $600 million in incremental SAM from our previous acquisitions this year” (CEO) ; completion of Mixel acquisition strengthens mixed-signal connectivity IP portfolio .

What Went Wrong

  • Revenue and bookings pressure: Q2 revenue $12.05M (−19% YoY, −15% QoQ) and bookings $12.9M (−34% YoY), driven by timing of renewals and macro-related PO push-outs, especially in TCAD .
  • Margin compression: Non-GAAP gross margin fell to 76% (vs 86% in Q2 2024) given lower volumes and higher COGS from acquisitions integration; non-GAAP opex rose to ~$14.9M on R&D and sales/marketing headcount and commissions .
  • Miss vs consensus: Q2 revenue and EPS missed Wall Street’s mean estimates (see Estimates Context) as large renewals slipped and TCAD remained softer YoY .

Financial Results

Headline P&L and EPS progression

MetricQ4 2024Q1 2025Q2 2025
Revenue ($USD Millions)$17.86 $14.09 $12.05
GAAP Gross Margin %86% 79% 71%
Non-GAAP Gross Margin %89% 82% 76%
GAAP Diluted EPS ($)$0.14 $(0.67) $(0.32)
Non-GAAP Diluted EPS ($)$0.15 $(0.07) $(0.16)

YoY comparison: Q2 2024 vs Q2 2025

MetricQ2 2024Q2 2025
Revenue ($USD Millions)$14.96 $12.05
GAAP Gross Margin %68% 71%
Non-GAAP Gross Margin %86% 76%
GAAP Diluted EPS ($)$(1.55) $(0.32)
Non-GAAP Diluted EPS ($)$0.07 $(0.16)

Segment breakdown

Segment Revenue ($USD Millions)Q1 2025Q2 2025
TCAD$7.90 $6.80
EDA$5.11 $3.40
SIP$1.09 $1.80

KPIs and mix

KPI / MixQ1 2025Q2 2025
Gross Bookings ($USD Millions)$13.7 $12.9
RPO ($USD Millions)$33.7 $36.4 (50% next 12 months)
License vs. Maint/Service (%)71% / 29% 60% / 40%
ACV (TTM) ($USD Millions)$52.3 $55.9
Cash, Cash Equivalents, Restricted Cash & Marketable Securities ($USD Millions)$74.5 $55.5

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Gross Bookings ($M)Q2 2025$14.0–$18.0 Actual: $12.9 Below range
Revenue ($M)Q2 2025$12.0–$16.0 Actual: $12.05 Achieved low end
Non-GAAP Gross Margin (%)Q2 202580–83 Actual: 76 Below
Non-GAAP Operating Income (Loss) ($M)Q2 2025(4.0)–(2.0) Actual: (5.7) Below
Non-GAAP Diluted EPS ($)Q2 2025(0.10)–(0.03) Actual: (0.16) Below
Gross Bookings ($M)Q3 2025—$14.0–$18.2 New
Revenue ($M)Q3 2025—$14.0–$18.0 New
Non-GAAP Gross Margin (%)Q3 2025—81–85 New
Non-GAAP Op. Income (Loss) ($M)Q3 2025—(3.5) to 0.5 New
Non-GAAP Diluted EPS ($)Q3 2025—(0.12) to 0.02 New
Gross Bookings ($M)FY 202567–74 67–74 Maintained
Revenue ($M)FY 202564–70 64–70 Maintained
Non-GAAP Gross Margin (%)FY 202583–86 83–86 Maintained
Non-GAAP Op. Income (Loss) ($M)FY 2025(2.0) to 1.0 (2.0) to 1.0 Maintained
Non-GAAP Diluted EPS ($)FY 2025(0.07) to 0.03 (0.07) to 0.03 Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024 and Q1 2025)Current Period (Q2 2025)Trend
Acquisitions / SAM expansionPPC closed; strong FTCO bookings; FY24 record bookings TechX closed (Q2); Mixel closed (Aug 1); +$600M + $110M SAM expansion Accelerating
AI/digital twin strategyFTCO adoption; HPC/memory focus Emphasis on AI, photonics, HPC, automotive; DTCO engagement deepening Broadening
Bookings and renewals timingHigh-value FTCO bookings in prior year TCAD renewals timing drove YoY declines; bookings down 34% YoY Temporarily softer
Regional dynamicsAPAC strength; EMEA partnership APAC up 11% YoY; Americas down; EMEA down on TCAD Mixed
Non-GAAP margins86–89% in FY24/Q4 76% in Q2; guide 81–85% for Q3 Rebound expected
Cash/liquidity$87.5M at FY24 close $55.5M at Q2; expected $30–35M post-Mixel cash Lower near term

Management Commentary

  • CEO: “We estimate that we have expanded our SAM by another $110 million… in addition to the estimated $600 million in incremental SAM from our previous acquisitions this year” .
  • CEO: “We are equally confident in our long-term growth trajectory, underpinned by strong market demand, strategic expansion, and the increasing value of our technology stack” .
  • FP&A: “We exited the quarter with $55.5 million in cash, cash equivalents, restricted cash and marketable securities… primarily due to the Nangate litigation settlement and the acquisition of TechX… we expect to book delayed POs later this year” .
  • FP&A: “TTM ACV growth of 26%… ACV normalizes multi-year deals and ASC 606 impacts; non-GAAP GM to expand toward 90%+ over time” .

Q&A Highlights

  • ACV composition: Organic contribution was ~1–2% of the 5% sequential TTM ACV increase; rest from acquisitions .
  • Mixel revenue outlook: Management provided a conservative range of $3–5M for Q3–Q4 2025 incremental revenue; not included in FY guidance yet .
  • FY guide achievability: Confidence to reach guidance midpoints based on closing delayed POs in Q3–Q4 and improving Asia macro; no cancellations reported .
  • Cash trajectory: Post-Mixel, cash expected around $30–35M (from $55.5M at Q2), reflecting closing payment .
  • PPC/TechX contributions: Remaining PPC ~$2M and TechX ~$1M expected in 2H; roughly one-third in Q3 and two-thirds in Q4 per commentary .

Estimates Context

  • Q2 2025 vs consensus (Wall Street, S&P Global):
    • Revenue: $12.05M actual vs $14.24M consensus* → miss .
    • Primary EPS (non-GAAP diluted): $(0.16) actual vs $(0.077) consensus* → miss .
  • Q3 2025 setup:
    • Company guidance revenue $14.0–$18.0M vs consensus $15.95M*; EPS guidance $(0.12) to $0.02 vs consensus $(0.037)* .

Values marked with an asterisk (*) were retrieved from S&P Global.

MetricQ2 2025 ConsensusQ2 2025 ActualQ3 2025 ConsensusCompany Q3 2025 Guidance
Revenue ($USD Millions)14.24*12.05 15.95*14.0–18.0
Primary EPS (Non-GAAP Diluted, $)(0.077)*(0.16) (0.0367)*(0.12) to 0.02
EBITDA ($USD Millions)(2.20)*(9.44) (1.90)*—

Key Takeaways for Investors

  • Near-term: Q2 miss and margin compression likely weigh on sentiment, but Q3 guidance implies a strong sequential rebound; watch for timing of TCAD renewals and closing of delayed POs as catalysts in Q3/Q4 .
  • Medium-term thesis: ACV up 26% and RPO growth underpin stability in recurring revenue; non-GAAP GM targeted to recover toward 90%+ as integration synergies materialize .
  • M&A-driven expansion: PPC, TechX, and Mixel broaden SAM (>$700M added in 2025) and cross-sell opportunities; incremental 2H contributions (PPC/TechX) and potential Mixel upside not fully baked into FY guidance, creating optionality .
  • Mix improvement: EDA and SIP growth offset TCAD volatility; monitor product mix as a lever for margins and bookings cadence .
  • Liquidity: Cash declined with settlements and acquisitions; post-Mixel cash of ~$30–35M is adequate but reduces flexibility—track working capital and opex discipline .
  • Regional dynamics: APAC strengthening vs Americas/EMEA softness tied to TCAD; regional mix may influence quarterly volatility and margin trajectory .
  • Stock reaction catalysts: Execution vs Q3 guide, closing delayed orders, synergy updates (cost/tax), and additional photonics/IP customer wins could drive estimate revisions and sentiment shifts .
Notes: All company-reported figures and commentary cited from Silvaco’s Q2 2025 8-K press release and supplemental tables **[1943289_0001628280-25-038358_a991earningsreleasedatedau.htm:0]** **[1943289_0001628280-25-038358_a991earningsreleasedatedau.htm:1]** **[1943289_0001628280-25-038358_a991earningsreleasedatedau.htm:2]** **[1943289_0001628280-25-038358_a991earningsreleasedatedau.htm:8]** **[1943289_0001628280-25-038358_a991earningsreleasedatedau.htm:10]** **[1943289_0001628280-25-038358_a991earningsreleasedatedau.htm:11]** **[1943289_0001628280-25-038358_a991earningsreleasedatedau.htm:12]**, Q1 2025 8-K **[1943289_0001628280-25-023156_a991earningsreleasedatedma.htm:1]** **[1943289_0001628280-25-023156_a991earningsreleasedatedma.htm:2]** **[1943289_0001628280-25-023156_a991earningsreleasedatedma.htm:8]** **[1943289_0001628280-25-023156_a991earningsreleasedatedma.htm:10]**, Q4 2024 8-K **[1943289_0001628280-25-010412_a991earningsreleasedatedma.htm:0]** **[1943289_0001628280-25-010412_a991earningsreleasedatedma.htm:1]** **[1943289_0001628280-25-010412_a991earningsreleasedatedma.htm:12]**, Q2 2025 earnings call transcript **[1943289_2060517_1]** **[1943289_2060517_5]** **[1943289_2060517_6]** **[1943289_2060517_9]** **[1943289_2060517_10]** **[1943289_2060517_11]**, and Mixel acquisition filings **[1943289_0001628280-25-037474_a991pressreleasedatedaugus.htm:0]**. S&P Global consensus data noted with asterisks.