17 November 2021
Transphorm turns profit as quarterly product revenue grows 30% year-on-year
For fiscal second-quarter 2022 (to end-September 2021), Transphorm Inc of Goleta, near Santa Barbara, CA, USA — which designs and manufactures JEDEC- and AEC-Q101-qualified gallium nitride (GaN) field-effect transistors (FETs) for high-voltage power conversion applications — has reported revenue of $11.3m, up from $3.2m last quarter and $1.9m a year ago.
Growth was driven by a combination of licensing revenue related to ongoing development work with a manufacturing partner plus record product sales from ramping shipments of GaN devices for a broad range of power conversion applications, including fast chargers and adapters, gaming, data center and crypto-mining. Product revenue rose sequentially for a seventh consecutive quarter and grew 30% year-on-year to a quarterly record.
“We continued to ramp device shipments in support of expanded design-ins going into production,” says president & co-founder Primit Parikh. “Product revenue in the first half of fiscal 2022 has exceeded the revenue contribution from products for the full fiscal year of 2021, driven by growing traction with our GaN devices in fast chargers and adaptors as well as high-power gaming, server and crypto-mining applications. Additionally, we continued to lay the foundation for significant future growth highlighted by the recently achieved automotive qualification of our SuperGaN Gen IV FET device. With strong customer momentum and strong blue-chip strategic partnerships, we expect continued product revenue growth in the coming quarters.”
Highlights during the quarter included continued momentum on adaptor and fast-charger market penetration, including partnerships with leading controller and integrated driver makers. Also, Transphorm achieved automotive qualification of its SuperGaN Gen IV multi-kilowatt-class power FET device. The firm was also awarded a $1.4m GaN development contract by the US Defense Advanced Research Projects Agency (DARPA).
On a non-GAAP basis, operating expenses were $4.45m, up from $3.5m a year ago but cut slightly from $4.59m last quarter.
Net income was $3.6m ($0.09 per share), compared with net losses of $5.3m ($0.13 per diluted share) last quarter and $5.3m ($0.15 per diluted share) a year ago. Cash and equivalents remained $2.5m at the end of the September quarter.
During the quarter, Transphorm completed the transaction for its AFSW wafer fab in Aizu Wakamatsu, Japan to be acquired by GaNovation, its joint venture formed recently with its new Palo Alto-based strategic financial partner JCP Capital. The AFSW fab was previously a JV with Fujitsu Semiconductor Ltd (FSL).
After the end of the quarter, in October, strategic partner Yaskawa Electric Corp of Kitakyushu, Japan (a manufacturer of low- and medium-voltage variable-frequency drives, servo motors, machine controllers and industrial robots) converted 100% of its $15.6m Transphorm convertible notes into common stock at $5 per share.
In subsequent private placement transactions completed in early November, the firm closed $33m of equity financing at $5 per share, comprising follow-on investments of $5m by KKR and $10m by Sino-American Silicon Products (SAS) as well as participation by institutional investors. This followed the closing of a $5m initial private placement by SAS in August.
“Through a series of successful transactions over the past few months, we have significantly strengthened our balance sheet and cash position while also realizing a $50m increase in shareholder equity since June,” notes chief financial officer Cameron McAulay. “In part as a result of our stronger financial position, we believe the company is now positioned to meet the qualification requirements for uplisting Transphorm’s common stock to the NASDAQ, an ambition we will continue to pursue aggressively in the coming months.”