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Everspin (MRAM) Q2 Earnings call transcript Jul 31, 2024

AInvestThursday, Aug 1, 2024 4:24 pm ET
2min read

In a recent earnings call, Everspin Technologies provided an update on their second quarter 2024 financial results. Despite experiencing challenges in the first half of the year, the company remains optimistic about its future prospects, particularly in the second half of 2024.

Revenue and Losses within Guidance

Everspin reported revenue of $10.6 million and a net loss of $0.12 per basic share for the second quarter, all within their guidance range. The company ended the quarter with a strong balance sheet, including cash of $36.8 million, providing a solid foundation for future growth.

Strategic Advancements and Product Development

Everspin highlighted several strategic advancements across their product portfolio, including their Toggle MRAM solution, design and technology development services, and foundry services. Despite facing weakness in Toggle MRAM due to inventory consumption and unfavorable currency exchange rates, the company is optimistic about the potential for a modest ramp in the second half of 2024.

Everspin's 4 meg to 128 megabit STT-MRAM PERSYST family has seen strong traction, with high design activity and production volume, especially in the European and Asia Pacific regions. The company expects to begin delivering on these design wins later this year or in early 2025, with a few expected to go into production in late 2024.

Everspin's STT-MRAM technology has been chosen by IBM for use in its Flash NOR module 4 for data center applications. This marks the fourth generation of IBM's FCM to feature Everspin's technology and demonstrates the company's ability to meet the high-performance demands of the data center sector.

Rad-Hard Programs and Strategic Partnerships

Everspin is actively engaged in two Rad-Hard programs utilizing their STT-MRAM technology. The first program, an ad hoc 64-megabit STT-MRAM project, remains ongoing. The second program aims to build a strategic Rad-Hard FPGA, and Everspin recently executed a contract to collaborate with QuickLogic and Honeywell on this initiative. This contract will allow Everspin to provide its innovative AgILYST MRAM technology, logic design, and back-end-of-line manufacturing services, supporting DoD strategic and space system requirements.

Opportunities in the Automotive Sector

Everspin sees significant opportunities in the automotive sector, particularly with the increasing electrification of vehicles. Central processing units in electric vehicles require higher density and faster memory, and Everspin's STT-MRAM products are well-positioned to address this need. The company expects to have further conversations with potential automotive customers at the Automotive Chiplet Alliance Conference in October.

Outlook for the Remainder of 2024

Everspin anticipates a stronger second half of 2024, with the expectation of recognizing revenue from new STT-MRAM design wins. The company remains focused on scaling its business and converting design wins to revenue, particularly in the PERSYST Toggle MRAM and STT-MRAM product lines.

In conclusion, Everspin Technologies' earnings call provided a comprehensive update on the company's second quarter 2024 performance. Despite facing challenges in the first half of the year, the company remains optimistic about its future prospects, particularly in the second half of 2024, when it expects to begin recognizing revenue from new design wins. With a strong balance sheet and strategic partnerships in place, Everspin is well-positioned to capitalize on opportunities in the automotive sector and other high-growth markets.

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