Executive Summary

Q4 revenue rose to $96.2M (+3.8% y/y; +3.2% q/q) on higher Advanced Products mix and sharply higher royalty income; gross margin expanded to 52.4% vs 49.1% in Q3 as mix and royalties improved .
GAAP diluted EPS was $0.23 vs $0.26 in Q3 and $0.19 y/y; operating expenses ticked up modestly q/q; cash from operations stepped down to $10.1M on working capital dynamics .
Book-to-bill moved above 1.0 and 1-year backlog increased 3.3% q/q to $155.5M (still below $160.8M y/y), signaling improving demand trajectory exiting the year .
Management withheld quarterly guidance citing “a wide range of scenarios” for 2025; a February ITC Final Determination imposed exclusion and cease-and-desist orders on infringing NBM-related imports—management cited a new hyperscaler license and NBM orders as early tailwinds (potential stock catalysts) .

What Went Well and What Went Wrong

What Went Well
- Advanced Products strength and royalties: Advanced Products revenue share rose to 60.6% (from 53% in Q3), and royalty revenue nearly doubled y/y in Q4, lifting gross margin to 52.4% .
- IP enforcement traction: ITC Final Determination confirmed Vicor patents were infringed and set a 100% bond for system imports during presidential review; management disclosed a “significant” hyperscaler license and noted related orders in January .
- Fab execution: New ChiP fab achieving short cycle times (as little as ~10 days) and 96% fab test yields on devices in mass production, supporting margin and responsiveness as volumes build .
What Went Wrong
- VPD (Gen 5) timing: “Perfecting our 2nd generation, high density VPD…has taken longer than expected” with an ASIC needed to hit current-density targets; sampling to Broader customers depends on demo system readiness post-lead customer .
- EPS down q/q: EPS fell to $0.23 from $0.26 in Q3 as opex rose sequentially and cash generation moderated; product mix headwinds from legacy HPC have diminished but not disappeared .
- No formal guidance: Management remains unable to provide quarterly guidance given uncertainty around AI/HPC ramp timing and licensing cadence, limiting near-term estimate visibility .

Financial Results

Metric	Q4 2023	Q3 2024	Q4 2024
Revenue ($M)	$92.652	$93.2	$96.166
Gross Profit ($M)	$47.344	$45.7	$50.360
Gross Margin (%)	51.1%	49.1%	52.4%
Operating Expenses ($M)	$39.995	$40.4	$41.155
Diluted EPS ($)	$0.19	$0.26	$0.23

Segment/Revenue mix

Product vs Royalty (Q4 comps)

Revenue Mix ($M)	Q4 2023	Q4 2024
Product Revenue	$85.524	$80.392
Royalty Revenue	$7.128	$15.774
Net Revenues	$92.652	$96.166

Key KPIs and Operating Metrics

KPI	Q4 2023	Q3 2024	Q4 2024
Backlog ($M)	$160.8	$150.6	$155.5
Book-to-Bill	N/A	Below 1.0	Above 1.0
Exports (% of revenue)	N/A	~49%	~56.9%
Advanced Products Share (%)	N/A	53%	60.6%
Cash from Operations ($M)	$21.5	$22.6	$10.1
Capital Expenditures ($M)	$7.2	$8.5	$1.7
Cash & Equivalents ($M)	$242.219	$267.6	$277.3

Notes: Management attributed y/y GM% increase primarily to increased royalty income and lower supply chain costs ; Q4 backlog up 3.3% q/q, down 3.3% y/y .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	Q1 2025 / FY 2025	No formal guidance (Q3)	No formal guidance; “unable to provide quarterly guidance” given uncertainty	Maintained (no guidance)
Gross Margin	Q1 2025 / FY 2025	No formal guidance	No formal guidance	Maintained
OpEx	Q1 2025 / FY 2025	No formal guidance	No formal guidance	Maintained
Tax Rate	Q1 2025 / FY 2025	No formal guidance	No formal guidance	Maintained
Segment-specific	2025	N/A	None provided	N/A
Longer-term “north star” remains $1B revenue and 65% GM target as the fab fills .

Earnings Call Themes & Trends

Topic	Q2-2024 (Prev -2)	Q3-2024 (Prev -1)	Q4-2024 (Current)	Trend
AI/Gen 5 VPD	Demo systems to select customers “towards end of Aug”; rebuilding HPC pipeline; Gen 5 touted for higher density vs stacked VPD	PCB respin delayed Gen 5; initial shipments in “next couple of months”; revenue ramp expected 2025	Gen 2 VPD “took longer”; ASIC due by end-Feb; focused on lead customer, demos to others to follow	Improving readiness; near-term execution focus
ChiP Fab/Operations	Vertical integration benefits; working capital; CapEx moderating; no guidance	All Advanced Products produced in new factory; shorter cycle times; scalability emphasized	10-day soup-to-nuts cycle; 96% fab test yields on mass production devices	Operational KPIs improving
IP/ITC/Licensing	Expect favorable ITC outcome; licensing building but undisclosed	Initial determination positive; customers skeptical of workarounds; legal path outlined	Final Determination; exclusion & C&D orders; 100% bond during review; “significant” hyperscaler license; NBM orders	Enforcement momentum accelerating
Mix/Margins	Q2 GM 49.8% on legacy HPC mix; royalties increasing	Q3 GM 49.1% on mix; legacy HPC headwind moderating into Q4	Q4 GM 52.4% on higher royalties and Advanced mix	Mix and royalties favorable
End-markets	Industrial/A&D strength; automotive pipeline $1.3B	Industrial & A&D steady; HPC lumpy; automotive broadening	A&D/industrial remain strong; HPC strengthening with new licensee orders	Broad base steady; HPC inflecting

Management Commentary

CEO on margins and licensing synergy: “Further margin improvements depend upon higher utilization of our ChiP fab and increased licensing income… standard license provides royalty discounts commensurate to the Licensee’s annual purchases of Vicor modules” .
CEO on Gen 2 VPD timing: “Perfecting our 2nd generation, high density VPD…has taken longer than expected… focused on completing development… for a lead customer ahead of providing demo systems” .
CFO on uncertainty and guidance: “2025 is a year of uncertainty and opportunity… we are unable to provide quarterly guidance until we are further along” .
VP Sales on ITC and licensing: ITC final determination resulted in exclusion/C&D orders; “a hyperscaler has recently taken a license to Vicor’s NBM IP,” and future enforcement and damages actions will continue .
CEO on fab performance: “We… make chips… in as little as 10 days… with respect to devices… in mass production… fab test yields of 96%” .

Q&A Highlights

VPD timeline and customer: ASIC “coming out of fab… in the next 10 days” (late Feb); goal to support lead customer ramp in 2H’25; demo systems for broader customers thereafter .
Licensing and royalties: “Significant” hyperscaler license; license covers NBMs “from any source”; Q4 Advanced Products strength primarily HPC; licensing encourages module purchases (fab fill over time) .
Fab utilization readiness: Sequential Advanced mix up; strong progress on cycle times/yields; building demo/system capability to scale predictably .
ITC mechanics: 60-day presidential review with 100% bond on system value; exclusion order prohibits infringing imports after review period; Vicor may recover bonds .
Capital allocation: Minimal buybacks in Q4; will consider opportunistically; capex needs declining; leverage expected as fab loading increases .

Estimates Context

S&P Global consensus (EPS and Revenue) for Q4 2024 was unavailable at time of analysis due to API daily request limits; as a result, we cannot quantify beats/misses vs Wall Street estimates at this time. We recommend revisiting when S&P Global access is restored to update the comparisons.
Management did not provide formal quarterly guidance, reinforcing a wider range of outcomes near-term .

Key Takeaways for Investors

Improving quality of revenue: Royalty income and Advanced Products mix are lifting margins; sustained licensing momentum could structurally support GM% alongside fab utilization gains .
Near-term catalyst path: ITC Final Determination, new hyperscaler license and associated NBM orders support HPC recovery; watch for additional licenses/enforcement, fab loading progress, and demo-to-design-win conversions in 1H’25 .
Execution focus on Gen 2 VPD: ASIC availability (late Feb) and demo system readiness are gating items; lead customer ramp targeted for 2H’25—any acceleration/deviation will move the stock .
Demand signals firming: Book-to-bill >1 and backlog up q/q into Q1; exports trended up to ~57% of revenue in Q4; industrial and A&D remain resilient .
Cash/CapEx flexibility: Strong cash balance ($277.3M) with declining capex and improving operating metrics provide optionality for ramp and potential selective buybacks .
Estimate visibility limited: No guidance and S&P consensus unavailable today—sell-side models likely to adjust around royalty trajectory, HPC ramp timing, and litigation/licensing economics once data normalizes .

Sources: Q4 earnings press release and financial tables ; 8‑K 2.02 filing and attached press release ; Q4 earnings call transcript (prepared remarks and Q&A) -; ITC Final Determination press release (Feb 14, 2025) .

VICOR CORP (VICR)·Q4 2024 Earnings Summary