SEALSQ's Q2 2025: Contradictions Emerge on R&D Spending, Sales Cycle, Market Strategy, and Revenue Growth

The above is the analysis of the conflicting points in this earnings call

Date of Call: September 10, 2025

Financials Results

• Revenue: $4.8M for H1 2025, flat YOY (consistent with H1 2024)
• Gross Margin: 34% for H1 2025, up from 19% in H1 2024 (+15 pts)

Guidance:

• FY25 revenue expected at $17.5–$20M (+59% to +82% YOY), including IC'ALPS consolidation; demand recovery in semis and PKI.
• Gross margin expected to normalize at 45–50% on legacy chips; IC'ALPS margins higher.
• 2026 revenue growth targeted at +50% to +100% YOY, driven by quantum-resistant TPM, full-year IC'ALPS, and Quantix Edge Security.
• Pipeline of ~$170M opportunities across 2026–2028 (PQC, ASIC, sovereign semis).
• QS7001 PQC MCU production samples/dev kits in Q3’25; initial revenues in 2026.
• QVault TPM sampling V183 in Q4’25 and V185 in Q1’26; initial 2026 revenues.

Business Commentary:

* Revenue Growth and Product Innovation: - SEALSQ reported that revenue is expected to increase by 59% to 82% in 2025 compared to 2024. - This growth is attributed to strong demand for post-quantum-resistant (PQC) solutions and strategic product innovations such as the QUASAR Program and QVault TPM, which are designed to protect industries from emerging threats like quantum computers.

• Strategic Acquisitions and Partnerships:
• SEALSQ completed the acquisition of IC'ALPS in August 2025, bringing 100 skilled engineers to its team and strengthening its post-quantum ASIC capabilities.

• The acquisition of IC'ALPS is expected to enhance SEALSQ's competitive advantage in the market and facilitate the commercialization of new technologies.

• Investment in Research and Development:

• The company invested $4.7 million in research and development in the first half of 2025, with plans to allocate $7.2 million for the full year.

• This significant investment is part of SEALSQ's commitment to maintaining a leadership position in post-quantum innovation and commercializing next-generation chips.

• Strong Financial Position:

• SEALSQ's cash reserves increased to $150 million as of September 9, 2025.
• The strong financial position is due to the successful raising of over $140 million in additional capital during the past year, which will support strategic investments and growth initiatives.

Sentiment Analysis:

• “Revenue is expecting to be in the range of $17.5M to $20M, representing 59% to 82% growth year-on-year.” “Gross profit margin increased … from 19% last year to 34% this year.” “Robust cash reserve of $121M as of June 30, ’25 and $150M at Sep 9.” “Business pipeline stands at $170M in opportunities for 2026 to 2028.”

Q&A:

• Question from Matthew Galinko (Maxim Group LLC, Research Division): Clarify the full-year R&D budget (~$7M) versus $4.7M in H1—was there anything unusual that won’t repeat?
  Response: H1 R&D included a one-off stock-based compensation item; underlying spend should be lower in H2.

• Question from Matthew Galinko (Maxim Group LLC, Research Division): What is the annualized R&D run rate excluding the one-off and factoring in the acquisition?
  Response: Underlying pre-IC'ALPS R&D runs ~$500k–$550k per month; IC'ALPS R&D will be consolidated in H2.

• Question from Matthew Galinko (Maxim Group LLC, Research Division): How is the $170M pipeline constructed and what’s included/excluded?
  Response: Pipeline uses weighted stages (identified, qualified, design-in, design-win) over 2026–2028 and excludes already-won revenues.