SkyWater Technology 2025 Q2 Earnings Net Loss Widens 827.4%

SkyWater Technology (SKYT) reported its fiscal 2025 Q2 earnings on Aug 7, 2025, showing a continued struggle to maintain profitability. The company missed expectations across core metrics, with a significant revenue decline and a dramatically expanded net loss. CEO Thomas Sonderman emphasized the strategic importance of the recently acquired Infineon Fab 25, positioning it as a key driver for future growth.

SkyWater Technology's total revenue declined sharply by 36.7% to $59.06 million in Q2 2025, compared to $93.33 million in Q2 2024. The revenue breakdown showed the ATS development segment contributed $52.60 million, while time-and-materials and cost-plus-fixed-fee contracts generated $36.57 million. Fixed price contracts totaled $15.26 million, and other revenue streams added $778,000, with wafer services and tools contributing $5.41 million and $1.05 million, respectively.

Net losses expanded to $8.86 million in Q2 2025, translating to a $0.21 per share loss, representing a 827.4% increase compared to the $955,000 loss, or $0.04 per share, in Q2 2024. The company has recorded losses for six consecutive years during the corresponding quarter, underscoring the persistent financial challenges it faces.

The stock price of SkyWater Technology experienced a strong post-earnings rebound, surging 14.32% on the latest trading day, 43.58% for the week, and 21.92% for the month. However, a post-earnings trading strategy of buying SKYT following a positive report and holding for 30 days delivered a -78.30% return, underperforming the benchmark by 117.68%. The strategy exhibited a maximum drawdown of 0.00% and a Sharpe ratio of -0.37, indicating a high level of risk with no positive returns during the backtested period.

CEO Thomas Sonderman noted that second-quarter results were at the upper end of expectations and highlighted the successful acquisition of Infineon’s Fab 25, funded through a new $350 million debt facility. The company anticipates Fab 25 will generate at least $300 million in annual revenue and strong adjusted EBITDA and free cash flow starting in Q3. While acknowledging the impact of a continuing resolution delaying DOD funding, Sonderman emphasized momentum in quantum computing and advanced packaging, setting the stage for strong growth in 2026.

SkyWater expects Fab 25 to contribute at least $300 million in annual revenue and generate strong adjusted EBITDA and free cash flow beginning in Q3 2025. Despite the potential impact of delayed DOD funding on ATS revenue growth in 2025, the company is optimistic about its strategic positioning in quantum computing and advanced packaging, which, combined with Fab 25’s addition, will drive a strong performance in 2026.

Additional News
Recent developments in the semiconductor industry highlight the intense competition and technological evolution shaping the sector. Among these, OpenAI’s release of GPT-5 marked a significant advancement in AI capabilities, with potential implications across multiple industries. Additionally, geopolitical tensions continue to influence supply chains and investment decisions, particularly in critical technology sectors such as semiconductors. Meanwhile, Japan announced a breakthrough cancer treatment technology to be shared with China, and South Korea’s SK hynix reported a major data leak, underscoring the growing challenges in data security and international collaboration. The tech industry also saw a rise in strategic mergers and acquisitions, with companies seeking to consolidate market positions amid shifting economic conditions and global demand dynamics.