Navitas Semiconductor Q2 Earnings: Revenue Down 29.2% YoY, Q3 Guidance Below Consensus

Navitas Semiconductor reported a Q2 2025 non-GAAP loss of 5 cents per share, in line with estimates, and revenues of $14.5 million, down 29.2% YoY. Shares declined 15.7% due to sluggish results and an unimpressive outlook. The company expects Q3 2025 revenues of $10 million and has partnered with NVIDIA and Powerchip to support next-generation data centers and create potential markets of up to $1.2 billion per year.

Navitas Semiconductor reported a Q2 2025 non-GAAP loss of 5 cents per share, in line with estimates, and revenues of $14.5 million, down 29.2% year-over-year (YoY). The company's shares declined 15.7% due to sluggish results and an unimpressive outlook. Navitas expects Q3 2025 revenues of $10 million and has partnered with NVIDIA and Powerchip to support next-generation data centers and create potential markets of up to $1.2 billion per year.

The company's pivot towards AI-driven power solutions and its alignment with NVIDIA's data center roadmap are evident in its Q2 performance. While revenue fell 30% to $14.5 million, the gross margin of 38.5% (non-GAAP) indicates improved cost management despite the strategic shift. Navitas' cash reserves of $161 million provide a buffer to fund this transition, but investors must weigh the trade-off between short-term losses and long-term positioning.

Navitas' strategic partnerships with NVIDIA and Powerchip target the $2.6 billion AI power chip market by 2030, focusing on 800V systems and GaN/SiC technology. These partnerships aim to capture potential markets of up to $1.2 billion per year, but volume production is expected by 2027. The recent 8-inch GaN foundry partnership with Powerchip further addresses scalability concerns.

The company's Q3 revenue guidance of $10 million signals a near-term contraction, driven by reduced mobile market engagement and geopolitical risks like China tariffs. This volatility raises concerns about cash flow sustainability, though the $161 million cash balance provides some cushion. Investors should monitor Navitas' ability to secure design wins in AI data centers and maintain gross margin stability.

Navitas' long-term strategic alignment with AI-driven power demand is compelling. The company's $2.6 billion market opportunity by 2030, coupled with its technological edge in GaN and SiC, suggests strong upside potential. However, the path to profitability is not without hurdles, and the stock has traded in a volatile range, reflecting investor skepticism about near-term profitability.

For long-term investors, Navitas offers a high-conviction opportunity in a sector poised for exponential growth. However, patience and a close watch on design win progress will be essential to unlocking its full potential. The delayed impact of the NVIDIA AI halo may prove to be a catalyst for Navitas' long-term success—if the company can execute its vision without exhausting its financial runway.

References:
[1] https://www.ainvest.com/news/navitas-semiconductor-q2-2025-earnings-navigating-ai-transition-long-term-growth-potential-2508/
[2] https://stocktwits.com/news-articles/markets/equity/navitas-gets-a-downgrade/chrLyAMRd2s
[3] https://www.ainvest.com/news/navitas-semiconductor-q3-revenue-guidance-falls-short-shares-drop-16-ai-push-2508/