Q4 2024 Navitas Semiconductor Corp Earnings Call
Speaker Change: Good afternoon. Thank you for standing by and welcome to NAVITA Semiconductor's 4th Quarter 2024 Financial Results Conference Call.
Speaker Change: Please be advised, today's conference is being recorded and a replay will be available on Navitar Semiconductor's Investor Relations website. I would now like to hand the conference over to Stephen Oliver, Vice President of Investor Relations.
Speaker Change: Good afternoon, everyone. I'm Stephen Oliver, Vice President of Investor Relations. Thank you for joining Navitas Semiconductor's fourth quarter and full year 2024 results conference call. I'm joined today by Gene Sheridan, our Chairman, President, CEO and Co-Founder, and Todd Glickman, CFO.
Speaker Change: A replay of this webcast will be available on our website approximately one hour following this conference call and available for approximately 30 days. Additional information related to our business is also posted on the Investor Relations section of our website.
Our earnings release includes non-GAAP financial measures.
Speaker Change: Reconciliations of these non-GAAP financial measures with the most directly comparable GAAP measures are included in our fourth quarter earnings release and also posted on our website in the investor relations section.
Speaker Change: Non-GAAP expenses and operating margin exclude stock-based compensation, amortisation of intangible assets and other non-recurring items.
Speaker Change: In this conference call, we will make forward-looking statements about future events or about the future financial performance of Navitas, including acquisitions. You can identify these statements by words like, we expect, or we believe, or similar terms.
Speaker Change: We wish to caution you that such forward-looking statements are subject to risks and uncertainties that could cause actual events or results to differ materially from expectations expressed in our forward-looking statements.
Speaker Change: Important factors that can affect Nevitas business, including factors that could cause actual results to differ from our forward-looking statements, are described in our earnings release. Please also refer to the risk factor sections in our most recent 10-K and 10-Qs.
Speaker Change: Our estimates or other forward-looking statements may change, and Navitas assumes no obligation to update forward-looking statements to reflect actual results, changed assumptions, or other events that may occur, except as required by law.
And now, over to Eugene Sheridan, CEO.
Eugene Sheridan: Thank you, Steve, and thanks to everyone joining us today. We completed 2024 with an all-time high of $83 million in revenue, despite a semiconductor slowdown throughout the year in which most of our larger power semiconductor peers saw declining revenues.
Eugene Sheridan: While our silicon carbide business was impacted by the slowdown in solar, industrial, and EV, our GAN business grew over 50% in 2024 to an all-time high, with revenues coming from mobile, consumer, appliance, and the initial ramp-up of data centers.
Eugene Sheridan: We also completed 2024 with an extraordinary $450 million of design rents, which reflects lifetime revenues of new customer programs in which Novotus products are expected to ramp to revenues over the next few years.
Eugene Sheridan: This design in total represents a win rate of over 50% and gives us increased confidence in and visibility to expected growth as we look into the second half of 2025 and 26.
Eugene Sheridan: I'm also pleased with our total customer pipeline growth, which has nearly doubled from $1.25 billion at the end of 2023 to $2.4 billion at the end of 2024, reflecting strong expected expansion in our major markets.
Let me share some specifics in each.
Eugene Sheridan: Our data center sector has the highest growth rates in revenue and design wins, with 40 customer project wins throughout the year.
Eugene Sheridan: These wins were at top ODMs in Asia that target major Tier 1 data center players such as Google, Amazon, Facebook, Alibaba, Dell, HP, and others.
Eugene Sheridan: were key enablers for this new business as we showcase to customers the extraordinary energy efficiency
and power density that is possible.
Eugene Sheridan: particularly when combining our Genesec technology in the PFC circuit and our GANSAFE technology in the LLC circuits for these AC to DC power supply units.
Eugene Sheridan: Also, we view the emergence of lower-cost AI platforms such as DeepSeek as a positive development that we expect to drive a lower cost of AI implementations which can accelerate AI adoption both in the cloud as well as the edge.
Eugene Sheridan: potentially translating to greater overall demand for power and for Novitas technology. Our data center customer pipeline has more than doubled to over 165 million as compared to 70 million the year prior.
Eugene Sheridan: As announced last quarter, we have started sampling our 80 to 120 volt same-lived GaN devices, targeting 48 volt DC to DC converters in data centers, as well as 48 volt EV battery systems and 48 volt robots in the longer term.
Eugene Sheridan: We expect growing customer demand activity throughout 2025 and first appreciable revenues next year.
Eugene Sheridan: In the EV space, we are happy to announce over 40 design wins in 2024 across Europe, U.S., China, and Korea, heavily focused on onboard chargers as well as roadside chargers.
Eugene Sheridan: We're also excited to announce what we believe to be the industry's first GAN design win into any electric vehicle.
Speaker Change: China's number three EV player, Chang'an, has selected Novita ScanSafe technology to power their next-generation EV onboard chargers, and they have achieved extraordinary power densities of 6 kilowatts per liter and energy efficiencies of 96 percent.
Speaker Change: Changin estimates that these GaN-safe powered onboard chargers could extend lifetime driving range by 10,000 kilometers and could reduce charging costs by 15 to 20 percent.
Speaker Change: We expect this project and other GAN-EV projects to start production ramp in the first half of 2026.
Speaker Change: Our ED pipeline has expanded rapidly to over 900 million, compared to 400 million a year ago, and now represents nearly 40% of our $2.4 billion pipeline.
Speaker Change: In the mobile sector, we have enabled very broad expansion in the adoption of GaN chargers with over 180 design lengths.
Speaker Change: This includes the first significant wins with Transient, now a top five global smartphone player, and the leader in markets such as Middle East, Africa, and Central and South America.
Speaker Change: We also had our first wins in India with Jio, a leader in consumer networking, who selected Novita Scan ICs to power their next-generation Wi-Fi equipment.
Speaker Change: We expect both of these new customers will reflect multiple million-dollar projects ramping in late 2025, demonstrating greater mainstream adoption of GaN chargers expanding into these lower-cost regions.
Speaker Change: We now estimate that GaN chargers will reach over 10% adoption rate of all mobile chargers to power smartphones, tablets, and laptops in 2025 as the average power of these chargers approaches 45 watts.
Speaker Change: This power increase is an important trend to not only support faster charging for all consumers, but also our GAN value increases as that power level increases, delivering the maximum power at the highest efficiencies and with the smallest size and weight for these wall adapters.
Speaker Change: Navitas continues to supply 10 of the top 10 mobile players designing with Navitas KNIC technology.
Speaker Change: In the solar space, we are on track for a major launch this summer, with the leader in microinverters, to begin an important and significant transition from silicon to GaN, enabling a new wave of energy efficiency, power density, and size, rate, and cost reductions for the solar industry. We see microinverters becoming the leading residential solar solution, and many other players in this space are expected to pursue a similar transition from silicon to GaN.
Speaker Change: Across solar, energy storage, industrial, and appliance sectors, we enjoyed over 170 customer design news in 2024, which we expect will feel important growth in 2026 and beyond.
Speaker Change: I'm excited to share our plans for a major technology announcement coming up on March 12th.
Speaker Change: This will be our first ever global online launch event, and while the details won't be disclosed until that event, we believe this announcement will usher in a new era for power electronics and accelerate gallium nitride and silicon carbide in major multi-billion dollar markets.
Speaker Change: We hope you will all join us for this exciting event.
Speaker Change: Finally, looking towards 2025, we expect a Q1 revenue decline reflecting normal mobile seasonality coupled with continued end market weakness and some remaining inventory correction in the solar, industrial, and EV markets.
Speaker Change: We expect a modest recovery in Q2 and anticipate returning to healthy growth in the second half of the year fueled by our $450 million of design wins last year and the expected start of a semiconductor recovery.
Speaker Change: Now let me turn it over to Todd Glickman, our CFO, to cover the financials in greater detail.
Speaker Change: Our Gan revenue grew more than 50% for the full year and reached an all time high as aggressive adoption of Gan to replace Silicon continued in the mobile consumer and appliance segments.
Speaker Change: With data set of revenues starting in the second half of the year.
Speaker Change: Before addressing gross profit and expenses I would like to refer you to the GAAP to non-GAAP reconciliations in our press release earlier today and.
Speaker Change: And the rest of my commentary I will refer to non-GAAP measures.
Gross margin in the fourth quarter was 42%, which was relatively flat sequentially compared to 41% in the third quarter.
Speaker Change: For the fiscal year 2024, non-GAAP gross margin was 44% compared to 41, 8% in 2023, primarily due to less favorable market mix.
Speaker Change: In the fourth quarter, we executed on expense management initiatives and reduced operating expenses sequentially to $19 9 million comprised of SG&A expenses up $8 million and R&D expenses of $11 9 million.
Speaker Change: This demonstrates our ability to balance operational efficiency, while we continue investing in next generation Gan and <unk> technology and in market development, primarily in data center, EV and mobile sectors.
Speaker Change: For fiscal year 2024, non-GAAP operating expenses were $83 4 million compared to $73 5 million in the prior year.
Speaker Change: Adding all this together the fourth quarter 2020 for loss from operations was $12 $7 million flat sequentially as cost reductions offset the quarter over quarter revenue decline.
Speaker Change: And a loss.
Speaker Change: $49 7 million for the full year compared to a loss of $40 3 million for 2023.
Speaker Change: Our weighted average share count for the fourth quarter was 187 million shares.
Speaker Change: Turning to the balance sheet in Q4, the company disengaged with a silicon carbide distributor, resulting in a one time $11 6 million expense relate.
Speaker Change: Related to an inventory reserve and bad debt.
Accounts receivable sequentially declined to approximately $14 million from 26 million in the prior quarter.
Speaker Change: And inventory fell to $15 5 million from $21 3 million.
Speaker Change: In turn reducing our days of inventory to 130 down from 147.
Speaker Change: Our balance sheet remains very strong as we enter 2025 with high levels of liquidity and an improved working capital position cash and cash equivalents at quarter end were $87 million and we continue to carry no debt.
Speaker Change: Moving onto guidance for the first quarter. We currently expect revenues in the range of $13 million to $15 million, reflecting greater than typical seasonality given continued softness and remaining inventory corrections and solar EV and industrial end markets.
Speaker Change: Overall, while we continue to forecast a more muted first half of 2025, we anticipate growth to resume in the second half fueled by 2024 design wins and expected recovery in a number of our end markets.
Speaker Change: Gross margin for the first quarter is expected to be slightly lower than the fourth quarter with our guidance at 38% plus or minus 50 basis points as our expected mix continues to lean toward the mobile market in the near term.
Speaker Change: We expect modest margin improvement throughout the year align with the growth anticipated in our higher power markets.
Speaker Change: Turning to operating expenses, we have completed some additional workforce reductions and are realizing further synergies and operational efficiencies associated with prior acquisitions.
Speaker Change: All of which align our cost structure with revenue expectations.
Speaker Change: By consolidating certain support and engineering functions and sites.
Speaker Change: And further streamlining the company.
Speaker Change: We anticipate a reduction of our first quarter operating expenses to 18 million.
And approximately $15 5 million per quarter thereafter.
Speaker Change: Combining all of our cost reduction and efficiency improvements with our strong cash position clean balance sheet and growth outlook firmly positions the company to reach expected positive EBITDA in 2026.
Speaker Change: For the first quarter of 2025, we expect our weighted average share count to be approximately 190 million chips.
Speaker Change: In closing, while we are thoughtfully navigating the near term softness in some of our end markets, our substantial customer pipeline and design wins.
Speaker Change: And ever increasing technology lead puts us in a strong position to scale to profitability as we enable the next generation of power electronics.
Speaker Change: Operator, let's begin the Q&A session.
Speaker Change: Thank you.
Speaker Change: As a reminder, if you'd like to ask a question.
Speaker Change: Please press star and the number one on your telephone keypad.
Speaker Change: The first question.
Ross Seymore: This is coming from Ross Seymore from Deutsche Bank.
Speaker Change: Your line is open.
Hi, guys. Thanks for let me ask a question Jean just wanted to talk a little bit about where you think the cyclical bottom is I know seasonality plays a big part in the March quarter overall in some of your more consumer and mobile areas, but do you think the cyclical side of the equation has found the bottom now and if so how do you view the slope of the recovery.
Jean: Yeah. Good question Ross.
Jean: Certainly Q1 by all measures looks to be a cyclical bottom at least from another perspective, obviously, we're a smaller player we have maybe different market dynamics on where Gan on silicon carbide are being adopted.
Jean: Industrial still seems pretty sluggish.
Jean: We're a little more bullish on especially as the Gan adoption starts middle of the year is probably where we've seen the best pick up starting in China, I think others have observed the same.
Jean: We're more bullish there too because we've just got such a strong pipeline and onboard Chargers in particular combination of silicon carbide and Gan as well as the roadside charter Chargers, which is all silicon carbide and brand new modules. We introduced so I think all of those are sort of at play but from our perspective cyclical bottom certainly seems to be Q1, but we see the recut.
Jean: Turning to Q2, and a nice healthy growth outlook for the second half.
Speaker Change: And I guess as my follow up.
Speaker Change: You talked about the strength of the Gan business growing over 50% last year and I'm not asking you for specific numbers in the silicon carbide side of things, but how are you viewing that market was it in your mind just weaker because the end market was weak inventory burn et cetera, and we've heard that for many many players or was there something a little more <unk> specific and that that would.
Speaker Change: Potentially adjust your strategy for your silicon carbide business going forward.
Speaker Change: Yes, no great question, certainly the market slowdown.
Speaker Change: But it's specifically focused primarily at <unk> solar.
Speaker Change: Industrial and those are the three things we've seen slowdown in the last year at the whole industry has seen them. So that's certainly first order effect, but also we talked about increasing our focus as a company around strategic applications last quarter and Thats really in the EV space, where we're leveraging again in southern carpet together with our system reference designs.
Speaker Change: And those have.
Speaker Change: Increased dramatically in terms of the pipeline the design wins, a big percentage of that.
Speaker Change: At $450 million of design wins last year was in the EV space, which leverages, both Gan on Silicon carbide secondarily as they've taken a thorough type charges. That's all silicon carbide. So I think thats shifting things for US and then of course, we're just rolling out in the last couple of quarters. The datacenter strategy, which again is a combination of Gan installing permit.
Speaker Change: Playing into it so I think we had our own investment and focus areas to sort of work through and I think we're starting to see that come through.
Speaker Change: Particularly as the market improves, but even without that market improvement. We will see these designs design wins kicking in in the silicon carbide business growing nicely throughout the year.
Thank you.
Ross Seymore: Thanks Ross.
Ross Seymore: Thank you.
Speaker Change: Our next question comes from the line of Quinn Bolton.
Speaker Change: From Needham <unk> company.
Speaker Change: Your line is open.
Speaker Change: Hey, guys I, just wanted to ask and make sure Tom I heard you right on the Opex beyond Q1 did you say it would come down to $15 5 million.
Speaker Change: And if that's right how long do you think you can keep it at that level.
Speaker Change: And then I guess a follow up question. Obviously, you guys have cut opex now by roughly 25%.
Speaker Change: How much how much fat do you think you've got here or do you do you feel like youre starting to potentially limit.
Speaker Change: Growth in some of these new opportunities with the cuts you have made.
Speaker Change: Yes, Thanks, Brent let me take that first question. So yes, $15 5 million on a go forward basis, we expect to keep that fairly flat on a go forward basis as we're continuing to leverage what we currently have in our business and so we don't expect much growth on that Opex number.
Speaker Change: In regards to your second question on.
Speaker Change: And basically yes is there any fat left in the business, we have been pretty diligent on on looking internally and on acquisition synergies and we feel like the business is right sized right now so we do not see any more fat to trim, we are properly sized to grow, especially in the second half that we're seeing.
Speaker Change: Today and across.
Speaker Change: In markets, such as data center, EV and mobile.
Okay, Great and then maybe if I could just one quick one on data center I think in the past you guys had sort of thought that could be a $10 million to $20 million business. In 2025, just wondering if that's still sort of the right ballpark to be thinking about for data center or if you've seen any.
Speaker Change: Movement in that kind of expectation. Thank you.
Speaker Change: Yes, yes, thanks, Quinn, obviously, given out full year guidance for breaking it down by sector, but I do feel good about their trajectory. We started ramping in Q3 as you know the design wins grew nicely I mentioned 40 total for the year I think through Q3. It was only nine or 10 year to date last year. So a really strong Q4 design win period, which will only help.
Speaker Change: To accelerate that so no specific breakout for the year, but the trajectory is good and growing sequentially throughout 'twenty five.
Speaker Change: Great. Thank you thanks, Jeff Okay. Thanks.
Speaker Change: Thanks Quinn.
Speaker Change: Thank you.
Speaker Change: Our next question comes from the line of Kevin Cassidy from Rosenblatt Securities.
Speaker Change: Is open.
Kevin Cassidy: Yes, thanks for taking my question.
Speaker Change: Also somewhere around data center.
Speaker Change: The 40 design wins can you describe kind of what the bell curve is of the various power supplies. You had mentioned in the press release its $2 seven kilowatts.
Speaker Change: Eight five kilowatts, but I guess.
Speaker Change: Is it weighted one side or the other or is it right in the middle.
Speaker Change: Where we're most job designs are.
Speaker Change: Yes. Good question it started off pretty well.
Broad from even some below two kilowatt, which was a little surprising because our technology is best for the high density the high power as you know, Kevin, but I think in many cases people really want to try it out they know the future is gan on silicon carbide for data center power space, because the future is high density and high efficiency.
Speaker Change: But now we're seeing I think the sweet spot is really where you could max out that power density and Theres two form factors and datacenter for AC to DC power space Theyre Crts form factor, we've pushed that to its limit at $4 five kilowatt and we're seeing nice pick up probably more concentrated there or you can go where the entire power shelf is dedicated power slides that's the OMB.
Specification, there we've pushed it to $8 five kilowatt and going even higher so I would look at those higher power levels as where we're seeing the increased concentration because thats really where that Gan and sick combination can give you that really the efficiencies and density Silicon we can't can't touch them, we're going to keep pushing those limits going forward.
Speaker Change: Okay great.
Speaker Change: Yeah, just a couple other questions.
Speaker Change: These deployments are there going to be tied to any particular gpus or.
Speaker Change: Are these going to be deployed despite any GPU upgrade cycle.
Speaker Change: Yes, I think a lot of people now are shifting beyond Blackwell to Rubin.
Speaker Change: So I think.
Speaker Change: Without obviously getting the customer confidential specific projects in terms of market trends I think we will see a lot of the design starting now we're going to be Reuben focused or let's say Reuben class.
Speaker Change: <unk> focus and it's not all about Nvidia of course, we're seeing other processors pop up traditional server ones as well as new AI ones that are getting into the mix as well.
Speaker Change: So.
Speaker Change: I think right now we're kind of focused on next generation. They are going to drive a lot of the new designs are going to try to drive a lot of the ramps in 2006 at this point.
Speaker Change: Okay understood. Thank you.
Speaker Change: Thank you.
Speaker Change: Our next question comes from the line of Jack Egan from Charter equity research your.
Speaker Change: Your line is open.
Jack Egan: Hey, guys. Thanks for taking my questions.
Jack Egan: I was hoping you could talk a bit about the distributor disengagement was that a part of the cost reduction plan or something else.
Speaker Change: No that was separate.
Speaker Change: Given the lack of performance across Silicon carbide, we decided to replace one of our channel partners.
Speaker Change: They really weren't achieving the design wins were expected across even industrial.
Speaker Change: And their lack of ability to pay for some delivered products, but on a go forward basis, we have inserted a new channel partner and that's going to help us with our growth in the second half of 2025.
Speaker Change: Great Okay.
Speaker Change: It's good to see your cash burn has slowed a bit or pretty good bit of the past two quarters. How are you thinking about raising capital at all I mean are you comfortable with your current cash balance and the.
Speaker Change: Cost reductions to kind of wait out the cyclical slowdown.
Speaker Change: That's a great question to your point right. We finished the year with $87 million, we burned 12 million in cash in Q4 and on a go forward basis. If we look past onetime events in Q1, we do expect that cash to slow down over a class usage to decrease over time and so right now we have two plus years of cash available to.
Speaker Change: US so we don't see any need organically to.
Speaker Change: Raise cash however, as we've stated in the past if there's a strategic.
Speaker Change: The initiative that we want to pursue then that would be an avenue, where we would raise cash.
Speaker Change: Got it thanks, so much.
Speaker Change: Thank you.
Speaker Change: Again, if you would like to ask a question. Please press star and the number one on your telephone keypad.
Speaker Change: And our next question comes from the line of John Taiwan Teng from CJS Securities.
Speaker Change: Your line is open hi, thanks for taking my question.
Speaker Change: I was wondering if you could talk about the $450 million in the design win pipeline.
Speaker Change: Maybe how much of that falls into this year next year and the year after.
Speaker Change: As you see scheduled from today and I know, it's different end market can be connected.
Speaker Change: Yes, thanks, John Thanks for and it's important to clarify it's our first time to give kind of a total design win indications coming out of the pipeline. So first let me clarify design was not a purchase order, but it is where the customer has actually selected <unk> to be included in the final production hardware. So it's a very significant industry wide event, let's say, our common turned to get into.
Speaker Change: Design validation phase, which is what people also call. It the 450 million does represent the lifetime revenue, we take a pretty conservative view mobile and consumer products, maybe one or two years, the more industrial high power markets, maybe three or four years. So it's spread out over that lifetime period, but to your question. When does it start to ramp. We also tried to take a conservative view on the ramp times. So we.
Speaker Change: The only considered programs that are ramping in 'twenty five 'twenty six 'twenty seven we are working on things that are could kick in or start in 2008 or beyond but we excluded them. So between all of my commentary that kind of gives you a feel for how does that layer in.
Speaker Change: Over the next three years and run for the next one to four years.
Speaker Change: Got it. Thank you that's helpful. And then could you help us understand the margin profile in the second half of the year as you get these design wins ramp how much comes from.
The higher volume gain products in.
Higher margin ones did in things like data center versus a recovery in SSD markets.
Speaker Change: Yes, while we don't.
Speaker Change: Comment on margins specific as it relates to end market you can we always know that our corporate margin mobile is always slightly below our corporate margins and higher power markets, such as EDI and data center will be.
Speaker Change: Large bigger than our our company margin level and so as the second half picks up and those higher markets start to convert design wins, we do expect some some marginal margin growth.
Speaker Change: But long term I think what those markets lead us to is our long term goal of 50% plus margin and that's no change from that.
Speaker Change: Okay, Great and then one more if I could just the reduction in Opex that youre talking about in the next two quarters, how much is coming out of R&D versus SG&A.
Speaker Change: No great question I think if you look historically at our splits youre going to see that same split on a go forward basis as you look at R&D and SG&A as we've taken those synergies out of both.
Speaker Change: Via the acquisitions from both avenues.
Speaker Change: Understood. Thank you.
Speaker Change: Okay.
Speaker Change: Thank you.
Speaker Change: Our next question comes from the line again from Ross Seymore from Deutsche Bank.
Speaker Change: Your line is open.
Speaker Change: Thanks, So let me squeeze in one follow up just wanted to talk about the competitive landscape gene have you seen any significant changes in the aggressiveness of the competition pricing.
Speaker Change: Need to burn inventory any sort of those cyclical dynamics, especially with the downturn as persistent as this one oftentimes you'll get those sorts of acts of desperation by about this time in the cycle have you seen that.
Speaker Change: Yes, I think we saw it more concentrated not surprisingly on silicon carbide, just because thats, where some of the market slowdown occurred over the last year year and a half ago. When we started to talk about some of the solar slowdown than industrial and even with that slowdown you get pockets of inventory you also get a little bit more ASP erosion that does seem to have stabilized I think the <unk>.
Speaker Change: Inventory pockets are reducing and stabilizing maybe one more quarter as we mentioned in the prepared remarks, and ASP erosion seems to be stabilized. So I think thats, all pretty encouraging Dan not as dramatic because it gets spent a little bit more healthier supply and demand across the mobile and consumer space and a little bit of a appliance.
Speaker Change: Perfect. Thank you.
Speaker Change: Okay.
Speaker Change: Thank you.
Speaker Change: Our next question comes from the line of Richard Shannon from Craig Hallum.
Speaker Change: Your line is open.
Speaker Change: Okay, great. Thanks for taking my questions.
Speaker Change: Maybe I'll ask a question here on <unk>.
Speaker Change: Calendar 'twenty five sales outlook I know you are not quantifying any sort of thought process here, but obviously last year had a really good year in Gan and obviously silicon carbide markets were very challenged.
Speaker Change: Challenge to say the lease here, how do we think about 2025 between the two materials systems here is one going to be notably better than the other.
Speaker Change: Yes, I think as I mentioned earlier rich.
Speaker Change: We really like our focused strategy on data centers, which is going to see a combination of growth in both <unk> and silicon carbide reason that silicon carbide in the PFC circuit for most designs Gan on the second stage of LLC, that's getting us the best efficiency. The best density for the customers. So I think that trends.
Speaker Change: Speaks for itself I think the same kind of thing as I mentioned is going on with EV.
Speaker Change: Onboard Chargers bullish that roadside Chargers is also improving as that infrastructure does need to get build out around the world.
Speaker Change: It's 100% Silicon carbide, so I think all of those will happen.
Speaker Change: Have a healthy growth going forward I think for both technologies because they are often used in combination.
Speaker Change: <unk> are key.
Speaker Change: Market growth drivers.
Speaker Change: Okay fair enough. Thanks for that and maybe a quick question for Todd I've heard about the new Opex spending level here and obviously you still have a profile of 50% gross margins here at the high end model here and then also getting to EBITDA breakeven here I guess my question here is how do we think about the revenue per quarter to get to that.
Speaker Change: Breakeven level.
Speaker Change: Yeah, right. So I think we.
Speaker Change: We recently this is our second reduction I think we went from a breakeven EBITDA of the mid <unk> to mid forties. This brings you to a breakeven them high thirties, obviously dependent on gross margins, but that's what we feel like this opex level brings us to a breakeven in high <unk> of revenue per quarter.
Speaker Change: Okay perfect. Thanks, that'll be all for me.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Thank you.
Jack Egan: Our next question comes back from the line of jet Egan from charter equity research.
Speaker Change: Your line is open.
Speaker Change: Great. Thanks for taking the follow up you mentioned you've found some additional synergies and Opex and last quarter. You said you were targeting a 14% reduction in force so.
Speaker Change: Is that going to be higher like up towards 20% now or where the cost from the cost savings found elsewhere.
Speaker Change: Yes. These cost savings were found elsewhere as we've gone through a number of acquisitions. Historically, so those cost savings were separate from the ones in Q4 and were directly related to synergies across those acquisitions.
Speaker Change: Great. Thanks, so much.
Thank you.
Next question comes back from the line of Richard Shannon from Craig Hallum.
Speaker Change: Your line is back open.
Speaker Change: Alright, well that was fast getting back in here.
Speaker Change: So to your two questions I got on the call late so I may have missed some prepared remarks here, but Jim did I catch accurately that you had a very market acceleration design wins in the data center space here I think if I heard you correctly tend to the first three quarters and then 30 in the fourth quarter to get to 40, if thats accurate here can you kind of lay out the dynamics here, what's going on is this.
Speaker Change: Share gains acceleration in the market and then when do these design wins go to market can they happen this year or is it beyond this year.
Speaker Change: Yes, yes, both both good points and yes, you've got the facts right rich so I.
Speaker Change: I think it is an acceleration.
Speaker Change: I'd like to think it's probably an acceleration of share gain but let's let's hold that until we sort of deliver on the <unk> on the revenue, but certainly the market continues to accelerate and we're pleased to see even after things like deep seek that the capex numbers keep going up globally. The power requirements. Even continue to go up as I talked about a lot of our design wins are not pushing to that power limit.
Speaker Change: $4 five kilowatt on the CRP.
Speaker Change: Five kilowatt and we're going to go even higher than that on the or the three platforms that I mentioned, so I think thats all.
Speaker Change: Pretty encouraging outlet for us.
Speaker Change: Okay Fair enough and my follow up question.
Speaker Change: No.
Speaker Change: That was it.
Speaker Change: Just another big picture question for you Jean just obviously you have a different geopolitical environment since the last earnings call I wanted to see if theres any changes.
Speaker Change: Changes that you would highlight either positive or negative.
Speaker Change: Globally.
Yes. Good question those are always a broad broad macro questions right. So obviously there is talk about tariffs hard to know how tariffs play out where are they which countries how do people respond to that.
Speaker Change: Equipment level, the chip level, but fundamentally we're one of the few companies doing.
Speaker Change: Semiconductor manufacturing in the United States as you know, we built selling carbon X fab in Texas, So that probably puts us a little bit better position than many others were already well into our China for China strategy, which was really about providing localized support for our China customers kind of defending and protecting that business, but also trying to grow and accelerate.
Speaker Change: Overtime. So I think both of those gives us a pretty good position in the changing macroeconomic environment, but we'll have to see it is a complicated world out there.
Speaker Change: Okay perfect. Thanks, Jim.
Jim: Thanks Rich.
Jim: Thank you.
Speaker Change: Excuse me seeing as there are no more questions in the queue that concludes our question and answer session.
Jim: That also concludes this call.
Speaker Change: Thank you all for joining you may now disconnect.
Jim: Okay.
Jim: Okay.
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