Enovix (ENVX) Reports Q3
Shares of our silicon battery startup Enovix (ENVX) are trading up nicely today after the company reported Q3 results after the close yesterday. Lots to cover here so I’ll bullet point the most relevant stuff then give my two cents:
Q3 Results and Q4 Guidance
- Q3 revenue of $4.3 million vs. $4.1 million expected. Most revenue from Routejade
- Q3 EPS of -$0.17 vs. -$0.21 expected
- Closed Q3 with $200.9 million in cash; burned $30.7 million in OpEx and $19.5 million in CapEx
- Guidance for Q4: Revenue $8 - $10 million (consensus $7.4 million).
Material Deals
- Announced development agreement with leading China smartphone OEM with top-five market share. Second deal of this type so far. Expected launch date in late-2025.
2024 Milestone Updates
- EX-2M battery first samples to be shipped in Q4 2024 (current quarter)
- High volume production line SAT (site acceptance testing) completion expected by end of 2024
- Agility Line (low volume) hit 80% yields on EX-1M battery.
2025 - 26 Targets
- Mass production for smartphone and IOT customers expected late-2025
- Second production line ordering to begin late-2025
- EX-2M to enter full-scale mass production in 2026.
Thoughts
Enovix remains a believer vs. non-believer story, and this quarterly update doesn’t change that. But clear progress is being made in the right direction. Yes, it would be nice to know the names of companies Enovix is working with, get production schedules, volume clues, etc. But the company isn’t there yet. Based on the timeline and milestones given in this update, investors should be looking at mid-2025 for the puzzle pieces to start falling into place and the stock to really start working (my best guess) and kiss goodbye to these frustrating up and down cycles. That said, should management convince potential customers to disclose their names sooner, I think the market would reward the stock. Looming in the background is the reality that Enovix will likely tap the equity market with a secondary offering upon any major, positive announcement that drives up the stock. That’s fine, provided the news is “dilution worthy.” This is part of the game of early-stage investing, you just gotta be patient. BUY
Copyright © 2024. All rights reserved. Copying or electronic transmission of this information without permission is a violation of copyright law. For the protection of our subscribers, copyright violations will result in immediate termination of all subscriptions without refund. Disclosures: Cabot Wealth Network exists to serve you, our readers. We derive 100% of our revenue, or close to it, from selling subscriptions to our publications. Neither Cabot Wealth Network nor our employees are compensated in any way by the companies whose stocks we recommend or providers of associated financial services. Employees of Cabot Wealth Network may own some of the stocks recommended by our advisory services. Disclaimer: Sources of information are believed to be reliable but they are not guaranteed to be complete or error-free. Recommendations, opinions or suggestions are given with the understanding that subscribers acting on information assume all risks involved. Buy/Sell Recommendations: are made in regular issues, updates, or alerts by email and on the private subscriber website. Subscribers agree to adhere to all terms and conditions which can be found on CabotWealth.com and are subject to change. Violations will result in termination of all subscriptions without refund in addition to any civil and criminal penalties available under the law.
