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Vicor (VICR) Q3 Earnings call transcript Oct 22, 2024

Daily EarningsMonday, Oct 28, 2024 8:26 pm ET

1min read

VICR --

Vicor Corporation recently held its Q3 2024 earnings call, providing insights into its financial performance and strategic initiatives. The company reported a total revenue of $93.2 million for the third quarter, a decrease from the previous year but a sequential increase from the second quarter. This revenue was driven by a 6.5% increase in Advanced Products revenue and a 10.8% increase in BRICK Products revenue.

Strategic Focus and Market Dynamics

During the call, Patrizio Vinciarelli, Chief Executive Officer, emphasized the company's strategic focus on the industrial, aerospace, and defense markets, which showed continued strength in Q3. However, there was a temporary weakness in the high-performance computing market due to lumpy orders. The company is optimistic about the opportunities in the automotive market, particularly with the adoption of a 48-volt zonal architecture by OEMs across Asia-Pacific and Europe.

Intellectual Property Protection

A significant portion of the call was dedicated to discussing Vicor's intellectual property (IP) protection efforts. The company has recently seen a surge in infringement cases, with Delta Electronics being a notable example. Vinciarelli emphasized Vicor's commitment to enforcing its IP and protecting the domestic industry from foreign theft of U.S. intellectual property. The company has introduced new DC-to-DC converter power module families utilizing advanced packaging technologies and is seeing increased interest in its Gen 5 VPD solutions for artificial intelligence and network processors.

Financial Performance

From a financial perspective, Vicor reported a consolidated gross profit margin of 49.1% for the third quarter, down from the prior quarter due to a change in product mix. The company's operating expense decreased sequentially, driven by a litigation contingency expense recorded in the second quarter. Net income for the quarter was $11.6 million, with a GAAP diluted income per share of $0.26.

Looking Ahead

Looking forward, Vicor is focusing on its strategy to deliver operational excellence and customer centricity. The company aims to achieve this by setting resources, goals, and priorities for its top 100 customers across four main markets. This strategy is expected to drive revenue growth and contribute to Vicor's $1 billion target. The company is also investing in its manufacturing capabilities, including the installation of a new MRP system and the expansion of its foundry capacity.

In conclusion, Vicor's Q3 2024 earnings call provided a comprehensive overview of the company's strategic initiatives, financial performance, and market dynamics. The company's focus on intellectual property protection and strategic growth in key markets positions it well for future success. Investors and analysts will be watching closely as Vicor continues to navigate the challenges and opportunities in the power conversion market.

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