SkyWater Technology reported fiscal third‑quarter 2025 revenue of $150.741 million, up 60.7% from $93.8 million in Q3 2024. Net income was $144.013 million, largely driven by a $110.8 million bargain‑purchase gain from the acquisition of Fab 25 in Texas. GAAP earnings per share were $2.95, while non‑GAAP EPS was $0.24, a $0.41 increase over the consensus estimate of $-0.17.
Revenue growth was powered by the first full quarter of operations at the new Texas facility, which contributed $86.6 million in wafer‑services revenue. Quantum‑computing and advanced‑packaging customers also drove demand, with ATS development revenue reaching $54.2 million. Compared with Q2 2025, when revenue was $59.1 million, the jump reflects both a higher‑margin mix and the rapid ramp‑up of the Texas plant.
Gross margin expanded to 24.0% GAAP and 24.6% non‑GAAP, up from 21.6% and 22.3% respectively in Q3 2024. The improvement is attributable to a shift toward higher‑margin wafer‑services work and disciplined cost control, offsetting the impact of a modest increase in tools revenue. Operating income rose to $7.854 million, and adjusted EBITDA reached $25.8 million, underscoring the company’s ability to convert revenue growth into profitability.
GAAP EPS of $2.95 includes the one‑time bargain‑purchase gain, which inflates the figure relative to the underlying operating performance. Non‑GAAP EPS of $0.24 beat the consensus of $-0.17, driven by strong margin expansion and the high‑margin mix from the Texas facility. The EPS miss relative to analyst expectations is largely a function of the one‑time gain’s absence in the non‑GAAP calculation.
Segment analysis shows that legacy wafer‑services revenue was $6.2 million, while ATS development and wafer‑services revenue from the Texas plant totaled $54.2 million and $86.6 million respectively. Tools revenue, which is lower‑margin, remained a small portion of total revenue, helping to preserve the overall margin profile.
Management guided for Q4 2025 revenue of $155 million to $165 million, non‑GAAP gross margin of 17% to 20%, and adjusted EBITDA of $16 million to $22 million. The guidance reflects confidence in continued demand from quantum‑computing and defense customers and the ongoing integration of the Texas facility.
CEO Thomas Sonderman said, “We’re pleased to report financial results for the third quarter that exceeded our expectations across all metrics. Revenues from multiple quantum‑computing customers reached a new quarterly record, and we are on track to exceed 30% growth in our ATS revenues from quantum customers in fiscal 2025.” He added that the Texas facility’s performance “is significantly stronger than initially forecast” and that the company’s “transformative acquisition was fully funded through a flexible new debt facility.”
Market reaction was modest, with aftermarket trading showing a 1.74% increase. The primary drivers were the record revenue beat, the strong performance of the Texas plant, and robust demand in quantum‑computing and defense sectors. The EPS miss relative to analyst expectations tempered the rally but did not offset the positive sentiment around the company’s strategic execution.
Headwinds include integration challenges of the Texas facility and market uncertainty in aerospace and defense, while tailwinds are strong demand in quantum‑computing, advanced packaging, and defense. The company’s focus on high‑margin services and its status as a U.S.‑based trusted supplier position it well for continued growth, but ongoing integration and market volatility remain risks.
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