Vicor Corporation

Vicor reported Q2 2026 product and royalty revenue of $143.4 million, up 26.9% sequentially from $113 million in Q1 2026 and up 1.6% from $141 million in Q2 2025, though the prior-year quarter included a $45 million patent litigation settlement. Advanced products revenue was $94.2 million, up 45% sequentially, and brick products revenue was $49.2 million, up 2.4% sequentially. Consolidated gross margin was 58%, up 280 basis points sequentially. Operating expenses were $48.2 million, up 6.1% sequentially. Net income was $49.8 million and GAAP diluted EPS was $1.4. Cash and cash equivalents ended at $453.6 million, up $49.4 million sequentially; operating cash flow was $34 million and capex was $11.2 million. One-year backlog increased 26% sequentially to $379.7 million, and book-to-bill was above 1. For Q3, management expects nearly 10% revenue growth sequentially. For full-year 2026, management said it expects over $600 million in revenue.

Patrizio Vinciarelli said Vicor is progressing on second-generation Vertical Power Delivery, with baseline 3 amps per square millimeter current density completed for the lead customer and demo systems now being built for broader customer engagement. He emphasized that the company sees strong industry interest, especially from hyperscalers and OEMs, but does not see competing solutions as adequate for the current-density and current-gain needs of AI and HPC systems. He also said Vicor is moving toward a second fab and described the company as being selective with customers as first-fab capacity tightens.

Jim Schmidt said Q2 revenue included $15 million from the most recent license agreement, with $5 million expected in Q3 and $10 million per quarter for the following four quarters under GAAP accounting. He highlighted the 58% gross margin, the $48.2 million in operating expenses, the $10.9 million tax benefit, and the $453.6 million cash balance, which was boosted by $34 million in operating cash flow and a $14.3 million IRS refund received on July 13. He also noted inventory rose 10.2% sequentially to $104.5 million, and he said product gross margin should improve as utilization rises, while Q2 margins were weighed by costs tied to moving equipment around in the first fab.

Analysts focused heavily on the new licensing revenue, second-gen VPD timing, and whether the company can scale capacity fast enough. Management said the Q2 license agreement is mainly royalty-based for now, with sourcing relationships expected later, and that the company currently has one hyperscaler and multiple OEM licensees. On capacity, Patrizio said the first fab is approaching utilization, the second fab is required to reach the $2.5 billion revenue goal, and the second site could ultimately support about 2x to 3x the first fab. Phil Davies said engagement with a hyperscaler and a couple of OEMs is expected this year, with production ramps likely in late Q3 or Q4 of next year and into 2028 as new fab capacity comes online.