Navitas Semiconductor: GaN's Next Wave – How 200mm Production Could Power Dominance in AI and EVs

The race to dominate the next-generation power semiconductor market is intensifying, and Navitas Semiconductor (NASDAQ: NVTS) is staking its claim with a bold move: expanding 200mm gallium nitride (GaN) production via its partnership with Powerchip Semiconductor Manufacturing Corporation (PSMC). This shift isn't just about scaling up—it's a strategic play to solidify supply chain resilience, slash costs, and capture surging demand in AI data centers and electric vehicles (EVs). Let's unpack the details and what they mean for investors.

The 200mm Gamble: Why It Matters

GaN has long been hailed as a game-changer in power efficiency, offering smaller form factors, faster switching speeds, and lower energy losses compared to silicon. Yet, its adoption has been hampered by manufacturing bottlenecks and high costs. Enter Navitas' partnership with PSMC, which aims to address both issues head-on.

The collaboration leverages PSMC's 200mm Fab 8B facility in Taiwan, which has been operational since 2019. By transitioning from smaller 150mm wafers to 200mm, Navitas expects a 78% increase in production efficiency, translating to more dies per wafer and higher yields. This is critical: cost per unit must drop for GaN to go mainstream in power-hungry sectors like AI and EVs.

The Timeline: A Calculated Rollout

The partnership is methodical, with clear milestones:
- Q4 2025: Qualify initial GaN devices (100V and 650V families).
- 1H 2026: Begin mass production of 100V devices for EV on-board chargers and AI data center 48V infrastructure.
- 12–24 months post-Q2 2025: Transition 650V devices (used in EV batteries and solar inverters) from TSMC to PSMC.

This phased approach minimizes disruption while prioritizing the lower-voltage 100V family, which has immediate applications in fast-growing markets. The 650V transition, while riskier, aligns with the expected surge in 800V EV architectures and high-power AI systems, where GaN's efficiency is most impactful.

Cost Efficiency: The Elephant in the Room

The real prize here is cost reduction. Larger 200mm wafers and PSMC's 180nm CMOS process (vs. older 150mm nodes) enable smaller geometries, boosting power density and performance while lowering manufacturing costs. Navitas estimates this could cut per-unit costs by ~30–40% over time—a game-changer for sectors like EVs, where cost parity with silicon is still a hurdle.

Strategic Alliances Fueling Growth

Navitas isn't just building chips—it's embedding them into tomorrow's tech ecosystems. Recent partnerships include:
- NVIDIA: Supplying GaN/SiC for 800V HVDC architectures in AI data centers, targeting 1 MW IT racks.
- Enphase Energy: Integrating GaNFast ICs into its IQ9 solar inverters.
- Changan Automobile: Using GaNSafe tech in EV onboard chargers.

These alliances underscore GaN's role as a backbone for hyper-efficient power systems, directly tied to $100B+ markets in AI and EVs by 2027.

Risks: Don't Ignore the Red Flags

The path isn't without potholes. First, execution risk: Transitioning 650V devices—a more complex, high-voltage segment—could face delays. Second, insider selling: Over the past six months, multiple insiders have offloaded shares, raising concerns about near-term confidence. Third, supply chain concentration: Reliance on PSMC introduces dependency risks, though it's mitigated by PSMC's proven track record in GaN manufacturing.

Investment Thesis: A Long-Term Bet on Power Efficiency

Despite these risks, the tailwinds are too strong to ignore. GaN adoption is accelerating in AI and EVs, with hyperscalers like Google and Amazon pushing for 48V infrastructure and automakers racing to 800V architectures. Navitas' partnership with PSMC positions it to capture this shift, especially as cost barriers fall.

For investors:
- Buy: If you're bullish on AI/EV adoption and willing to tolerate execution risks. Target cost reductions and partnerships could propel NVTS to $4–$6 over 2–3 years (per analyst estimates).
- Hold: For those cautious on near-term execution or insider sentiment.
- Avoid: If you prioritize short-term stability; delays in 650V transitions or cost targets could hit margins.

Final Verdict

Navitas' 200mm GaN push isn't just about keeping up—it's about leading. By marrying PSMC's manufacturing prowess with its own GaN expertise, Navitas is primed to become a go-to supplier for the next-gen power systems powering AI and EV revolutions. The risks are real, but the upside in a $15B+ GaN market by 2030 makes this a compelling long-term call. Stay tuned for Q4 2025 qualification results—they'll be the first stress test of this bold strategy.