Vicor Reports Revenue Shortfall in Q1 Due to Supply Chain Delays
Vicor Corporation reported financial results for the first quarter ended March 31, 2020 including revenues of $63.4 million, a 3.5% decrease from $65.7 million for the corresponding period a year ago, and a 0.4% sequential increase from $63.1 million the fourth quarter of 2019.
Gross margin decreased to $27.3 million for the first quarter of 2020, compared to $31.1 million for the corresponding period a year ago, and decreased sequentially from $29.8 million for the fourth quarter of 2019. Gross margin, as a percentage of revenue, decreased to 43.1% for the first quarter of 2020, compared to 47.3% for the corresponding period a year ago, and decreased from 47.1% for the fourth quarter of 2019.
Net loss for the first quarter was ($1.7) million, or ($0.04) per share, compared to net income of $4.3 million or $0.10 per diluted share, for the corresponding period a year ago and net income of $1.3 million, or $0.03 per diluted share, for the fourth quarter of 2019.
Cash and cash equivalents sequentially decreased by $1.9 million to approximately $82.8 million at the end of the first quarter of 2020, from $84.7 million at the end of the fourth quarter of 2019. Incremental capital expenditures for the first quarter of 2020 totaled $3.0 million as compared with $3.3 million for the corresponding period a year ago and $3.4 million for the fourth quarter of 2019.
First quarter bookings increased 5.2% to $70.1 million, from $66.6 million for the corresponding period a year ago, but decreased sequentially 8.8% from $76.8 million for the fourth quarter of 2019. Total backlog at the end of the first quarter of 2020 was $110.8 million, up 6.4 % from $104.2 million at the end of 2019.
Commenting on first quarter performance, Dr. Patrizio Vinciarelli, Chief Executive Officer, stated, “Q1 revenues fell short of forecast as supply chain delays caused production inefficiencies. Sequentially lower gross margins reflected these circumstances and higher new product development expenses contributed to a net loss for the period.”
“Our outlook for Q2 is for a sequential increase in revenue and a return to net profitability. While protecting the health of employees and confronting the challenges of the COVID-19 pandemic, we continue to operate our manufacturing facilities as an essential business supplying customers that depend on us.”
Dr. Vinciarelli concluded, “Orders booked in Q1 and the pace of activity in early Q2 reflect strengthening demand for Advanced Products. Despite near-term uncertainties due to the pandemic, 48V adoption in AI, data center servers and vehicle electrification, is a precursor to accelerating demand. We are, therefore, adding a new wing to our Andover manufacturing facility. Ready for occupancy in Q1 2021, the new wing will enable us to essentially double capacity for Advanced Products and vertically integrate all of the process steps necessary to manufacture ChiPs (“Converters Housed in Package”) utilizing 3D power packaging technology pioneered by Vicor. Our comprehensive IP portfolio includes Vertical Power Delivery, a power system architecture necessary to supply the escalating current requirements of AI processors.”