One-glance verdict
Overvalued
$1.47 our estimate vs market $7.35
Wall Street consensus: $15.17 (932.9% higher than our fair-value estimate)
401% above our estimate, beyond the bull case
Fundamentals snapshot
Silvaco Group, Inc.
SVCO · NMS · Technology · Software - Application
Current price
$7.35
52-week range
$3.07 - $14.39
Market cap
$249.06M
Balance sheet
Healthy
-47.10x Concerning
Net cash $7.93M. Interest coverage shows how many times profit covers the interest bill.
What stands out
2 Rewards
2 Risks
2 rewards · 2 risks
- Reward Revenue grew 14.9% last year.
- Reward Free cash flow was positive in 1/10 years.
- Risk Return on equity was -27.0% last year — the company lost money on shareholders' equity.
- Risk Operating margin compressed from -2.8% to -17.3% over 3 years.
What this company does
Silvaco Group, Inc.
Silvaco Group makes highly specialized software that companies use to design and test computer chips before they are physically manufactured, kind of like a digital simulator for the tiny brains inside electronics. The company makes money by licensing this software and selling pre-designed chip components to the makers of everything from displays and power devices to cars and 5G mobile technology. This is crucial because their tools help other tech companies innovate and bring new products to market faster and more reliably.
How the company got here
Silvaco was founded in 1984 to create software for the semiconductor industry (the companies that make the tiny electronic chips inside all of our devices). [2, 7] For decades, it operated as a private company, steadily growing by developing specialized tools that help design and manufacture chips more efficiently. [7] Starting around 2015, the company began acquiring other specialized software and design firms, adding new capabilities to its portfolio. [2, 3] This series of acquisitions expanded its offerings from its core simulation software into providing pre-designed chip components, known as intellectual property. [2, 3] A major turning point came in May 2024, when Silvaco became a publicly traded company through an IPO (Initial Public Offering, the first time a company sells its stock to the public). [2]
What it actually does
Silvaco provides highly technical software and ready-made design blueprints that chip companies use to design and manufacture semiconductors. [3, 6] Think of it like the software an architect uses to design a skyscraper before construction begins; Silvaco's tools let engineers build and test a virtual version of a chip and its manufacturing process on a computer. [3, 10] This allows them to find problems, improve performance, and reduce costs before spending millions of dollars on physical production. [10] The company's customers are the semiconductor manufacturers and the companies that design chips for everything from smartphones and displays to cars and power grids. [6]
TCAD (Technology Computer-Aided Design) Software
This is one of the company's core businesses, making software that simulates the actual physics of creating a semiconductor. [3, 6] TCAD tools allow engineers to model the chip manufacturing process at a microscopic level to predict how different materials and steps will affect the final chip's performance and reliability. [6, 10] Companies pay Silvaco for licenses to use this software to invent new types of chips or to improve the yield (the number of good chips produced) from their factories. This segment is foundational to the company's long history and technical reputation. [7]
EDA (Electronic Design Automation) Software
This is a broader category of software that helps engineers design the complex circuits that go onto a chip. [2, 6] Once the basic manufacturing process is defined with TCAD, EDA tools are used to draw the circuit diagrams, simulate how the electricity will flow, and verify that all the millions of tiny components will work together correctly. [6] Customers, from large chipmakers to universities, pay for subscriptions and maintenance (ongoing support and updates) for these essential design tools. [3, 5] This part of the business provides the digital equivalent of a blueprint and testing lab for chip designers. [10]
SIP (Semiconductor Intellectual Property)
Instead of designing every part of a complex chip from scratch, companies can license pre-designed, ready-to-use blocks of circuitry, which is what SIP is. [3, 10] Silvaco develops and sells these reusable designs for common functions, such as the parts of a chip that handle memory or data transfer. [6] Customers pay a licensing fee to integrate these proven designs into their own chips, which saves them significant time and reduces risk. [5] This is a growing part of Silvaco's business and functions like selling pre-fabricated, expert-designed modules for someone else to use in a larger construction project. [3]
What management is betting on now
The company's main focus is on integrating Artificial Intelligence (AI) into its software to make chip design and manufacturing even smarter and more efficient. [9, 14] They are particularly focused on an AI-powered tool that creates a "digital twin" (a precise virtual copy of a physical manufacturing process) to help factories improve their output. [14, 15] Management is also pushing to grow its Semiconductor IP business, seeing it as a key area for future expansion. [9] The overall strategy is to use these advanced technologies to drive double-digit revenue growth (increasing sales by 10% or more per year) and achieve sustained profitability (earning more money than it spends). [9, 14]
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q3
$-2.16M
FY2024 Q4
$-9.27M
FY2025 Q1
$-1.23M
FY2025 Q2
$-15.60M
FY2025 Q3
$-8.18M
FY2025 Q4
$-9.51M
FY2026 Q1
$-11.02M
FY2026 Q2
$-5.52M
Revenue
$17.81M
Net income
$-3.68M
Diluted EPS
-0.11
Operating cash flow
$-5.50M
Free cash flow
$-5.52M
Fetching…
Sources
Revenue
$17.75M
Net income
$-5.86M
Diluted EPS
-0.19
Operating cash flow
$-11.02M
Free cash flow
$-11.02M
Fetching…
Sources
Revenue
$18.25M
Net income
$-7.22M
Diluted EPS
-0.22
Operating cash flow
$-9.48M
Free cash flow
$-9.51M
Fetching…
Sources
Revenue
$18.67M
Net income
$-5.30M
Diluted EPS
-0.18
Operating cash flow
$-7.82M
Free cash flow
$-8.18M
Fetching…
Sources
Revenue
$12.05M
Net income
$-9.41M
Diluted EPS
-0.32
Operating cash flow
$-15.48M
Free cash flow
$-15.60M
Fetching…
Sources
Revenue
$14.09M
Net income
$-19.27M
Diluted EPS
-0.67
Operating cash flow
$-1.14M
Free cash flow
$-1.23M
Fetching…
Sources
Revenue
$17.86M
Net income
$4.16M
Diluted EPS
0.18
Operating cash flow
$-9.11M
Free cash flow
$-9.27M
Fetching…
Sources
Revenue
$10.97M
Net income
$-6.55M
Diluted EPS
-0.23
Operating cash flow
$-1.87M
Free cash flow
$-2.16M
Fetching…
Sources
Is it cheap or expensive?
Fair value $1.47 vs current price $7.35
Wall Street consensus is the average analyst price target: $15.17 (932.9% higher than our fair-value estimate).
Our most-likely fair value is $1.47 a share — about 80.0% below today's price of $7.35, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Healthy
Net cash $7.9M - more cash than debt. Interest coverage -47.1x.
Net debt
$-7.93M
Interest coverage
-47.10x
Silvaco Group, Inc.'s profit covers its interest bill about 0.0 times over. which is weaker than most peers shown here and 2 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Healthy
Worse cushion
Baseline
Better cushion
SVCO
BASELINE
Silvaco Group, Inc.
Total debt $5.07M Interest coverage -47.10x This is the baseline the peer rows are being compared against.
Total debt $17.42M Interest coverage -28.58x Neither company has much profit cushion over interest right now.
Total debt $8.69M Interest coverage -171.69x Neither company has much profit cushion over interest right now.
Total debt $71.56M Interest coverage 1.48x This peer still has a real interest-payment cushion, while SVCO does not.
What you should know
The case for and against SVCO
2 Rewards
2 Risks
Rewards
-
Revenue grew 14.9% last year.
-
Free cash flow was positive in 1/10 years.
Risks
-
Return on equity was -27.0% last year — the company lost money on shareholders' equity.
-
Operating margin compressed from -2.8% to -17.3% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
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Forward P/E
36.75x
P/B
3.09x
P/S
3.44x
EV/EBITDA
-17.33x
PEG ratio
—
Profitability
How much profit each dollar creates
Gross margin
83.2%
Operating margin
-17.3%
Net margin
-30.4%
ROE
-27.0%
ROA
-9.6%
Health
Liquidity and balance-sheet strength
Debt / equity
0.06x
Current ratio
1.72x
Quick ratio
1.60x
Total debt
$5.07M
Total cash
$13.00M
Growth
How the business has been compounding
Revenue TTM
$72.48M
Revenue 5Y CAGR
5.7%
EPS TTM
-0.70
EPS 5Y CAGR
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Cash flow
How much cash the business throws off
Operating CF TTM
$-33.82M
Free CF TTM
$-34.52M
FCF margin
-47.6%
Dividend
Shareholder payout
Yield
—
Payout ratio
0.0%
Last ex-div date
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