Everspin (MRAM) Q4 2025 Earnings Call Transcript

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DATE

Wednesday, March 4, 2026 at 5 p.m. ET

CALL PARTICIPANTS

• President and Chief Executive Officer — Sanjeev Aggarwal
• Chief Financial Officer — Bill Cooper

TAKEAWAYS

• Revenue -- $14.8 million, representing a 12% year-over-year increase and positioned near the high end of the guidance range of $14.0 million to $15.0 million.
• MRAM Product Sales -- $13.5 million, up 22% year over year, driven by growth in data center, energy management, and industrial automation applications.
• Licensing, Royalty, Patent, and Other Revenue -- $1.3 million, down from $2.2 million in Q4 2024 due to project completions, clarifying licensing’s volatility.
• Gross Margin (GAAP) -- 50.8%, a modest decline from 51.3% in 2024, attributed to lower licensing and other revenue.
• Other Income -- $2.0 million recognized in connection with the Department of Defense contractor award for MRAM facility sustainment, part of $10.5 million cumulatively earned on a $14.6 million contract scheduled for completion in 2027.
• Non-GAAP Net Income -- $2.6 million, or $0.11 per diluted share, with 23.8 million weighted average diluted shares outstanding; in line with the guidance range of $0.08 to $0.13 per share, but slightly below the $2.8 million, or $0.13 per share, reported in Q4 2024.
• Cash and Cash Equivalents -- $44.5 million at quarter end, down $0.8 million from $45.3 million in the prior quarter, with positive cash flow from operations of $2.8 million, up from $0.9 million in Q3.
• Design Wins -- 238 total in 2025, increasing from 178 in the prior year, supporting diversified end-market exposure.
• Product Development Milestones -- Ramp of the PERSIST 64 megabit xPy STT-MRAM to full production, with notable demand in the low Earth orbit (LEO) satellite market; higher-density parts (128 Mb, 256 Mb), and a 256 Mb monolithic xPy device using 16nm FinFET at TSMC are on track for high-volume availability in the second half of 2026.
• Strategic Partnerships and Qualification -- Qualified the 64 Mb xPy STT-MRAM part for Microchip’s PIC64 HPSC, and engaged with Lattice, and the Fraunhofer Chiplet Center for industry advancement and automotive use cases.
• Q1 2026 Outlook -- Revenue expected to remain in the $14.0 million to $15.0 million range; GAAP net loss per diluted share projected between a loss of $0.03 and income of $0.02; non-GAAP net income per diluted share expected between $0.07 and $0.12.
• Margin Guidance -- Targeting gross margin in the 50% range, with an anticipated sequential decline in non-product revenue creating a short-term headwind.
• Long-Term Revenue Target -- Strategic goal of reaching $100 million in annual revenue within three to five years, to be driven by new Persist xFi products, growth in Toggle MRAM, licensing, and the Unisys product family.
• Industry Environment -- Acknowledged semiconductor memory shortages, and customer interest in using Everspin Technologies’ STT-MRAM as a NOR flash replacement, with revenue timing dependent on customer qualification cycles.

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RISKS

• Bill Cooper stated, "We expect a sequential decline in non-product revenue due to a project completion in Q4 2025, which will result in a gross margin headwind."
• Sanjeev Aggarwal confirmed, regarding NOR flash alternative adoption, "revenue is contingent upon the qualification cycles of our potential customers."

SUMMARY

Management directly cited elevated product revenue, strong operational cash flow, and expanded design wins, reflecting strategic diversification across key verticals. Everspin Technologies advanced its high-density STT-MRAM roadmap, scaling production and qualifying products for high-reliability and aerospace markets, while securing new ecosystem partnerships aimed at long-term embedded and chiplet opportunities. Guidance for the first quarter points to revenue stability and disciplined operational cost management amid external industry shortages, supporting the stated $100 million annual revenue target.

• Everspin Technologies (NASDAQ:MRAM) emphasized its debt-free balance sheet, and capacity to support increased demand from NOR flash customers as memory shortages persist across the industry.
• Newly introduced Unisys products are planned for production in 2027, with management highlighting their expected contribution to future revenue growth, and relevance for edge AI and software-defined applications.
• The company affirmed that cash and cash equivalents of $44.5 million are "sufficient to meet our anticipated capital requirements," with ongoing positive cash flow from operations.

INDUSTRY GLOSSARY

• STT-MRAM (Spin-Transfer Torque Magnetoresistive Random Access Memory): A non-volatile memory technology offering high speed, endurance, and reliability, suitable for demanding industrial, and embedded applications.
• xPy: Everspin Technologies’ brand for high-reliability, advanced STT-MRAM product lines designed for use in harsh environments.
• LEO (Low Earth Orbit): Satellite orbit designation below 2,000 kilometers, requiring components with high tolerance to radiation and extreme conditions.
• Chiplets: Modular silicon building blocks that can be mixed and matched in advanced packaging to create flexible, customizable semiconductor systems.
• Unisys: Everspin Technologies’ unified code and data memory product family, targeting next-generation embedded and AI applications.

Full Conference Call Transcript

Sanjeev Aggarwal, President and Chief Executive Officer, and Bill Cooper, Chief Financial Officer. Before we begin the call, I would like to remind you that today's discussion may contain forward-looking statements regarding future events, including, but not limited to, the company's expectations for Everspin Technologies, Inc.'s future business, financial performance, and goals; customer and industry adoption of MRAM technology; successfully bringing to market and manufacturing products in Everspin Technologies, Inc.'s design pipeline; and executing on its business plan. These forward-looking statements are based on estimates, judgments, current trends, and market conditions and involve risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking statements.

We encourage you to review the company's SEC filings, including the annual report on Form 10-Ks and other SEC filings made from time to time in which the company may discuss risk factors associated with investing in Everspin Technologies, Inc. All forward-looking statements are made as of the date of this call and, except as required by law, the company undertakes no obligation to update or alter any forward-looking statement made on this call, whether as a result of new information, future events, or otherwise. The financial results discussed today reflect the company's preliminary estimates, are based on information available as of the date hereof, and are subject to further review by Everspin Technologies, Inc. and its external auditors.

The company's actual results may differ materially from these estimates as a result of the completion of financial closing procedures, final adjustments, and other developments arising between now and the time that the financial results for this period are finalized. Additionally, the company's press release and statements made during this conference call will include discussions of certain measures and financial information in GAAP and non-GAAP terms, including, in the company's press release, our definitions and reconciliations of GAAP net income to non-GAAP net income, which provide additional details. A copy of the press release is posted on the Investor Relations section of Everspin Technologies, Inc.'s website at everspin.com.

I will now turn the call over to Everspin Technologies, Inc.'s President and CEO, Sanjeev Aggarwal. Sanjeev, please go ahead.

Sanjeev Aggarwal: Thank you, Monica, and thanks everyone for joining us on the call today. We are pleased to report fourth quarter results with revenue of $14.8 million and non-GAAP EPS of $0.11 per diluted share, with revenue towards the high end of our guidance range and EPS in line with our expectations. Our performance this quarter was driven by strength in data center, energy management, and industrial automation applications. Growth in data center was driven by our ongoing work with IBM on the FCM4 module as well as its recently introduced FCM5, and the redundant array of independent disks (RAID) reference design at the top five hyperscale operators.

Within energy management and industrial automation, we saw demand return to normal levels after a period of inventory consumption that dampened demand in the prior year. With respect to below-the-line items, we recognized $2.0 million in other income in the fourth quarter and $10.5 million to date from the $14.6 million contract we have with a DoD contractor to develop a sustainment plan for our MRAM manufacturing facilities to provide continuous onshore MRAM capabilities for their aerospace and defense customers. We expect this business to progress on schedule with estimated completion in 2027. On the product side, we had a total of 238 design wins in 2025, up from 178 in the prior year.

Our pipeline of new design wins for our MRAM products speaks to the continuing technical innovation from the Everspin Technologies, Inc. team introducing new products to meet customer demand. These design wins support new customers and existing customers with new programs in industrial automation, casino gaming, energy management, and military and aerospace applications. Turning to some of our product development efforts, we continue to expand our xPy STT-MRAM portfolio in response to demand from our customers. We are pleased to announce that during the fourth quarter, we ramped our PERSIST 64 megabit xPy STT-MRAM high-reliability product to full production and saw strong demand driven by new customer interest and design wins, specifically in the low Earth orbital (LEO) satellite market.

These devices are AEC-Q100 Grade 1 qualified and ideally suited for use in harsh conditions, such as 125°C operating temperature with a minimum 10 years of data retention. These capabilities are demanded by our customers to secure critical data in a variety of systems in aerospace and defense, and industrial applications including automotive. We are taking orders to support high-volume production from our customers and began shipping in the current quarter. In addition, we are in the process of qualifying higher-density, high-reliability parts of 128 Mb and 256 Mb that will be available in high volume in the second half of this year.

We are on track to tape out a monolithic 256 megabit xPy STT-MRAM device on a 16-nanometer FinFET node at TSMC in the second half of this year. This part will be our first product in the Unisys family, unifying code storage and data memory in a high-density, non-volatile architecture for edge AI, industrial, and mission-critical designs. It is designed to deliver high-bandwidth read and write speeds in a non-volatile memory device, enabling fast boot, rapid updates, and predictable performance without the trade-offs of traditional flash-based designs. By combining high-speed access with persistent storage, this family of parts will support software-defined systems that require frequent reconfiguration while maintaining data integrity across power cycles.

As part of our efforts to build onto our partner network, we recently qualified our Persist 64 megabit xPy STT-MRAM for Microchip’s PIC64 HPSC series of 64-bit microprocessors (MPUs) and are supporting the ecosystem for components being qualified by Microchip. This ecosystem includes several industry partners that jointly offer solutions tailored for the harsh environmental conditions in space. The high-density, high-reliability xPy STT-MRAM parts I discussed earlier will be an ideal solution for this application. MRAM is achieving significant success as a leading embedded non-volatile memory in IoT, automotive, and AI edge devices. Yet, the densities and performance options of embedded MRAM macros have been limited.

At the same time, the semiconductor industry is moving towards chiplets to overcome rising costs, manufacturing complexity, and yield limitations of traditional large monolithic chips, especially when combining leading-edge logic, volatile, or non-volatile memory. Chiplets enable mix-and-match process nodes, greater customization, and reuse of building blocks, providing new degrees of freedom in the form of heterogeneous packaging solutions. With organizations such as the Open Compute Project embracing chiplets from the hyperscale data center to the edge, it is foreseeable that chiplets will be ubiquitous. This trend increasingly favors Everspin Technologies, Inc. given our focus on market chip solutions, including chiplets, and licensing our technology to embedded MRAM partners.

In 2025, we further advanced our efforts in this area through several initiatives. We engaged with the Fraunhofer Chiplet Center of Excellence to analyze next-generation automotive compute platforms and corresponding MRAM use cases. We subsequently progressed to engage on system-level simulations in which we plan to provide MRAM simulation models to allow an assessment as well as quantification of the benefits that MRAM can provide in various use cases. Everspin Technologies, Inc. is also participating in an effort to bring MRAM chiplets to the IMEC ecosystem that is aligned with the framework of the Open Compute Project chiplet work streams.

IMEC launched the Automotive Chiplet Forum in 2024 to bring together members from the automotive industry to enable an open chiplet ecosystem essential for accelerating innovation, reducing costs, and reinforcing the supply chain. More recently, we joined the newly formed Physical AI Chiplet Ecosystem (PACE) to help enable MRAM-based solutions for physical AI. As part of this effort, we will co-develop interoperable and reusable chiplets to reduce development costs and speed time-to-market for system and ASIC companies. Everspin Technologies, Inc. will provide a robust, high-performance, non-volatile memory to assist securing chiplets for boot, weight, and code storage as well as life-cycle management solutions. We expect to see chiplets addressing various applications over the next few years.

As a reminder, chiplets are part of our Unisys Unified Code and Data Memory solutions, which are currently in the design phase. To further enhance our position in the auto industry, we are working with Quinteris, a joint venture of leading semiconductor companies, on a next-generation RISC-V-based automotive reference design platform. RISC-V is an open standard instruction set architecture (ISA), based on reduced instruction set computer (RISC) principles, allowing anyone to design, manufacture, and sell chips without paying a license fee for the ISA. Its modular architecture allows designers to create purpose-built accelerators using RISC-V core technology as well as extensions. This also includes new instructions that uniquely integrate and leverage MRAM as a persistent working memory.

Given its rapid adoption, it offers a greenfield opportunity to create new MRAM-based architectures that fully utilize all the features and benefits that MRAM has to offer. Before I close, I would like to discuss our long-term strategy, which entails reaching $100 million in annual revenue over the next three to five years. We believe this growth will be driven by the ramp of new products, most notably our new xFi parts in our Persist product portfolio, such as the 64 megabit part I described earlier, and continued solid growth in our Toggle MRAM and licensing business. Our new Persist xFi parts are getting solid traction.

They are offered in densities from 4 megabit to 256 megabit and include the power-optimized SC families and the high-reliability (HR) families with Quad and Octal SPI interfaces. For example, in industrial automation, energy management, electric vehicle, and casino gaming markets, reliable high-density memories are required for next-generation systems. In aerospace and defense markets, such as LEO satellites, flight control systems require reliable, fast read and write speeds and fast boot for configuration. And in the FPGA and the MPU markets for edge AI, low standby power, instant on, and high-density memory are needed for larger bitstreams.

We expect our first enhanced serial NOR-like Unisys product family to be in production in 2027 and anticipate these products to contribute to our $100 million revenue target. Before I turn the call over to Bill to walk through our financials and guidance, I would like to briefly touch on the industry environment. As has been widely publicized, the industry is experiencing memory shortages. Memory suppliers who were, for decades, being pushed into commoditization have seen a shift based on unprecedented memory shortages driven by the demands of AI. As a result, they have gone into allocation mode and are moving their capacity up the food chain.

Companies that can make NOR flash, NAND, and DRAM are shifting those capacities to where they can get more margin out of their fixed capacity. NOR suppliers, for example, are converting their lines to support DRAM to maximize their margins and generate more revenue. This has created a gap in the supply for NOR flash and is driving customers to look for alternatives. We are in conversations with customers to evaluate our xFi STT-MRAM to replace NOR flash. We have the capacity to support such demand, and our parts are compatible with NOR flash. While these market dynamics are speeding up such conversations, revenue is contingent upon the qualification cycles of our potential customers.

I will now turn it over to our CFO, Bill Cooper, who will walk you through our fourth quarter financials and first quarter 2026 guidance. Bill?

Bill Cooper: Thank you, Sanjeev. Our results reflect the consistency of our execution. During the fourth quarter, we delivered revenue of $14.8 million, up 12% year over year and toward the high end of our guidance range of $14.0 million to $15.0 million, driven by higher product sales. MRAM product sales in the fourth quarter, which include both Toggle and STT-MRAM revenue, were $13.5 million, up 22% over the fourth quarter of the prior year. Licensing, royalty, patent, and other revenue in the fourth quarter decreased to $1.3 million from $2.2 million in Q4 2024 due to the completion of projects which were active in Q4 2024.

Turning to gross margin, our GAAP gross margin decreased to 50.8% for the fourth quarter, down slightly from 51.3% in 2024 due to lower licensing and other revenue. GAAP operating expenses for 2025 were $8.6 million, down sequentially and up slightly from $8.4 million in 2024. Other income of $2.0 million was related to the strategic award we won in mid-2024 to upgrade manufacturing equipment in our existing facility located in Chandler, Arizona. We recorded fourth quarter non-GAAP net income of $2.6 million, or $0.11 per diluted share based on 23.8 million weighted average diluted shares outstanding.

This was in line with our guidance range of non-GAAP net income of $0.08 to $0.13 per share and compares to non-GAAP net income of $2.8 million, or $0.13 per share, in 2024. As a reminder, reported non-GAAP results exclude the impact of stock-based compensation. We are pleased that our balance sheet remains strong and debt free. We ended the quarter with cash and cash equivalents of $44.5 million, down $0.8 million from $45.3 million at the end of the prior quarter. Cash flow generated from operations increased to $2.8 million for the fourth quarter from $0.9 million in the third quarter. We believe our cash and cash equivalents are sufficient to meet our anticipated capital requirements.

Our capital requirements depend on many factors, including, among other things, our growth rate; the timing and extent of our spending to support our current and future manufacturing requirements; research and development activities; the timing and cost of establishing additional sales and marketing capabilities; and the introduction of new products. We did not experience any material tariff-related impact on our results in the fourth quarter and do not expect any material tariff-related impact in the coming quarters.

Turning to guidance, we expect Q1 total revenue to be consistent with Q4 2025 and in the range of $14.0 million to $15.0 million and GAAP net loss per fully diluted share to be between a loss of $0.03 and net income of $0.02. On a non-GAAP basis, we anticipate net income per fully diluted share to be between $0.07 and $0.12. Going forward, we expect to exclude the impact of patent defense costs, in addition to stock-based compensation, from non-GAAP results. We expect a sequential decline in non-product revenue due to a project completion in Q4 2025, which will result in a gross margin headwind; however, we are still targeting gross margin to be in the 50% range.

In summary, we are pleased with our solid performance this quarter and remain committed to maintaining financial discipline while focusing on scaling our business and converting additional design wins to revenue. Operator, we will now open for questions.

Operator: Thank you. Ladies and gentlemen, to ask a question, then wait for your name to be announced. To withdraw your question, please press 11 again. Our first question comes from the line of Neil Young with Needham and Company. Your line is open.

Neil Young: Hey, thanks for letting me ask a question. Great to hear about the NOR flash opportunity. I am curious, you know, sort of you are talking about that, you are in conversations. I guess, how fast or how quickly do you think you could see upside from that, and sort of, you know, if you could, in any way, size the upside, that would be really helpful. Of possible upside in revenue. Thanks.

Sanjeev Aggarwal: Hey, Neil. Thank you for the question. So, like I said in the prepared remarks, I think it really depends on the qualification cycle for our potential customers. I can say that we are now getting listed as an alternate for NOR flash at various distributors worldwide because of the tight supply chain issues that we are seeing with NOR flash. So we do expect some upside, but it is very difficult to quantify today as to what that upside can be. But we are obviously available to meet the demand if the requests come in, and it just depends on the qual cycle of the customers.

Neil Young: Great, thanks. That is helpful. Just one more question for me. You talked about the inventory levels in energy management and industrial automation. They are starting to look pretty healthy, or you think that they do look healthy at this point. I guess, what gives you confidence that should not be, you know, be an issue next quarter and going forward? Thanks.

Sanjeev Aggarwal: So, based on the backlog that we are seeing at our distributors and the forecast that we are seeing at our customers, we do feel that they have burned through the inventory that they had overbuilt over the last year or so. So we are pretty confident that, going forward, we would not run into that same issue, at least in 2026.

Neil Young: Thank you.

Operator: Please standby for our next question. Our next question comes from the line of Richard Shannon with Craig-Hallum. Your line is open.

Richard Shannon: Well, hey, guys. Thanks for taking my question. The last one kind of in the context of this year here. I want to ask about two different contributors here. First of all, on the strategic RadHard project you have been working with your partner, and this has talked about a much better year. I am wondering if that is something similar that you are expecting as well. And then also, this quarter and a couple of past ones, you have been talking about some increasing contributions from the LEO satellite market.

Great to get a sense of what is the sense of scale of that today, and do you see that increasing over this year and over the next couple of years?

Sanjeev Aggarwal: Hey, thanks for the question, Richard, and thanks for joining. Clearly, you seem to be a little bit under the weather, but thank you for joining. As far as the LEO satellite market is concerned, I will let Bill address it. On the QuickLogic project, I think the award that QuickLogic talked about does not relate to the project that we have been working on jointly. And, in fact, I think that is the project that Bill was talking about in his prepared remarks, that it is not going to renew in the near future. We are going to see some decline in that non-product revenue in Q1 of this year.

That is still waiting for some milestones to be met by the other partners in the program, and we expect that to be kicking in again towards the second half of this year, but not in the first half.

Bill Cooper: Yeah, thanks, Sanjeev. And thanks, Richard, for the question. Yeah, I would say that, you know, the LEO satellite market is still a burgeoning market, and that is what we see both in terms of our orders and our backlog, and, you know, we feel confident about our products and our position there. And we expect to, again, kind of move up with that increased demand, especially as we have introduced our high-rel, high-reliability products as well that sort of fit perfectly in that particular marketplace as well.

Richard Shannon: Okay, great, thanks for that. Second question, just on your NOR flash replacement products, and maybe taking a different angle than one of the last questions here, and I will say your very interesting comments. But, obviously, you are targeting NOR flash replacement in certain markets. And if I caught your comments right, Sanjeev, you are talking about, I think, a win with, it was Microchip, on an MCU. Love to get a sense of when you see that becoming, you know, a material contributor. And then also, maybe, I think in the past you talked about some other engagements, particularly in the FPGA space, where you are excited about some progress there.

Maybe give us an update there as well, please.

Sanjeev Aggarwal: Yeah, good question, Richard. I think there are two partner programs that we are really excited about in particular. One is the one with Lattice, and the other one is this Microchip, and I think we are seeing steady progress with both those partners trying to get our product qualified and integrated into their standard offering. And I think that is where this big 64 at Microchip comes into play. They are perfect; the markets that they are targeting align very well with our spend in the aerospace and defense market. And then I think we can then expect to take into the commercial market as well.

But right now, the big 64 is targeted towards the aerospace and defense as well.

Richard Shannon: Okay, thanks for that. My last question, and I will jump off the line here. Sanjeev, you talked about a goal of driving towards, or driving to, $100 million of revenues within, I think, three to five years. Love to get a sense, any way you quantify, or at least rank order, the contributors of that revenue. I think in the big picture here, I think of the Toggle, the, excuse me, the STT products and licensing. I guess if there is any other way you would categorize the contributors, that would be very helpful. Yeah, thank you.

Sanjeev Aggarwal: So the way I look at it is, you know, the major contributor is going to be the Persist product, followed by perhaps equal contributions from our licensing and Unisys. And, you know, three to five years down the road, to hit the $100 million. In the Persist, I am including the Toggle MRAM products as well as the xFi STT products that we are shipping today, as well as the STT DR products that we are shipping to IBM. So I think those three would form the portion of the HR, form a portion of the Persist product, are going to contribute.

And this high-reliability product family that we have just introduced is going to actually give us a nice boost over that. And then, in 2027, we expect Unisys to kick in some volume. And so I think between that, Unisys, and our licensing is what is going to get us to the $100 million mark down the road.

Richard Shannon: Okay, I will jump off the line. Thank you for that, Sanjeev.

Sanjeev Aggarwal: Alright. Thank you, Richard. Hope you feel better very soon.

Operator: Thank you. Ladies and gentlemen, I am showing no further questions in the queue. That concludes today's conference call. Thank you for your participation. You may now disconnect.

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