Why Vicor Stock Skyrocketed Today
Key Points
Vicor's sales and earnings performance in Q3 crushed Wall Street's expectations.
An increase in royalty revenues helped power big sales and earnings beats.
Vicor expects that its licensing revenues could double over the next two years.
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Vicor (NASDAQ: VICR) stock booked a day of huge gains in Wednesday's trading. The company's share price ended the day's trading up 30.2%, and had been up as much as 36.6% earlier in the session.
Vicor published its third-quarter results after the market closed yesterday, delivering sales and earnings that were significantly better than anticipated. Sweetening the pot, the company also issued some very strong forward guidance.
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Vicor stock roars higher on strong Q3 print
Vicor reported earnings per share of $0.63 on revenue of $110.4 million, absolutely crushing the average Wall Street analyst estimate's call for per-share earnings of $0.12 on revenue of $95.4 million. Sales in the period rose 18.5% year over year, and margins came in far better than the market had expected. The power-technology specialist scored a significant increase in royalty revenues and indicated that this tailwind is poised to continue showing up on a quarterly basis over the next couple of years.
What's next for Vicor?
Vicor expects that its licensing revenues will grow at a rate of approximately 50% in the near term, and that total licensing revenues could double within the next few years. Vicor management also said that the company's Gen 5 vertical power delivery solution had met target specifications for its top customer and is now slated to launch in the first quarter of 2026.
In conjunction with the news, investors appear to be betting that Vicor will soon begin seeing significantly stronger revenue connected to products and licensing for artificial intelligence (AI) data centers.
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Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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