Silvaco (SVCO) Q4 2025 Earnings Call Transcript

Motley Fool Transcribing, The Motley Fool

Mon, March 16, 2026 astatine 9:24 AM CDT 24 min read

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Thursday, March 12, 2026 astatine 5 p.m. ET

• Chief Executive Officer — Walden Rhines

• Chief Financial Officer — Chris Zegarelli

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Walden Rhines: Thanks, Chris. Good afternoon, and convey you each for joining the call. I'm pleased with our show successful the 4th fourth of 2025. We're executing our turnaround program faster than anticipated, which tin beryllium seen intelligibly successful the numbers. For Q4, we delivered bookings astatine the precocious extremity of the guided range, gross and gross borderline supra the precocious extremity and non-GAAP operating expenses astatine the debased end, each resulting successful a overmuch little operating nonaccomplishment than expected successful the quarter. Our Q1 usher is beardown arsenic well. I'm arrogant of the squad for delivering specified beardown results and positioning america for a faster-than-expected betterment successful the business. Chris volition locomotion you done the details aboriginal successful the call.

But present I'll crook to discussing our advancement toward the instrumentality of the concern to a beardown predictable growth. I'd similar to commencement with large quality connected the AI front. We reached an important milestone successful Q4 up of our anterior expectations. During the quarter, a 2nd lawsuit adopted our AI-driven solution for manufacturing process improvement known arsenic FTCO. This triumph with a lawsuit successful Asia and is extracurricular of our Memory segment. We judge that this triumph confirms the wide lawsuit worth of our AI solution beyond representation and points to important opportunities ahead. This AI bundle delivered above-average bookings and revenue, reflecting the precocious worth placed connected our unsocial acceptable of AI capabilities.

It's precise encouraging to spot adoption of our AI solutions faster than expected. In our full TCAD concern successful Q4, we saw a 70% sequential summation successful bookings to $9.2 cardinal and a 34% sequential summation successful gross to $8.7 million, driven by adoption of FTCO by a caller customer. We proceed to heighten this AI-driven process improvement level with caller and upgraded features that enactment much AI features successful beforehand of much plan and manufacturing engineers to slash their improvement times, prevention wealth and alteration first-time close silicon. We judge that the modulation to much AI-enabled income volition beryllium a semipermanent tailwind to the business.

After a brushed 2025, we besides expect the gait of TCAD declaration renewals to accelerate successful 2026. These trends enactment our anticipation that the TCAD concern volition turn sequentially successful Q1 and volition turn for the afloat twelvemonth 2026 arsenic well. In Q4, we besides saw a meaningful inflection successful the semiconductor IP business. We delivered grounds IP gross and bookings of implicit $5 cardinal successful the quarter, driven by our archetypal afloat 4th of Mixel gross post-acquisition. Mixel's industry-leading MIPI PHY IP continues to person a beardown pursuing globally, led by its estimation for unparalleled quality. We're gathering connected that estimation by leveraging the entirety of the Silvaco income unit to thrust much maturation successful Mixel products.