Silvaco Group, Inc. Common Stock (SVCO) | The Buildout — AI Infrastructure

——Mkt cap — · 52-wk —–— · YTD — · delayed

Updated Aug 12, 2026Q1 FY2026 reviewed

Silvaco provides TCAD, EDA, and semiconductor IP software, including FTCO AI/ML digital-twin tools used to simulate and optimize chip manufacturing.

Revenue +48% YoY

Q2 FY2026 revenue $17.8M; year-ago $12.0M.

Non-GAAP op profit

First since late 2024.

IP revenue +238% YoY

Record IP bookings and revenue in Q2.

Bookings missed guide

Q2 bookings $16.2M vs $19M ±10% guide.

The Buildout Takeaway

The quarter delivered profitability and cash-growth milestones and drew external validation from Micron, NVIDIA, and Dassault. But demand durability is still unproven: bookings undershot guidance, and the flagship FTCO business remains pre-inflection by management's own account.

Analyst coverage

5 analysts·5 Buy0 Hold0 Sell

Coverage is thin — only 1 price estimate, so no target is shown

Management guidance

Q3 FY2026: bookings $18M ±10% · revenue $17M ±10% · non-GAAP gross margin around 88% · non-GAAP OpEx $14.5M ±5% · FY2026 revenue above $70M · Q4 record revenue expected.

Important: The Buildout is a data analytics platform. Content is generated by algorithms and AI agents using public filings, earnings transcripts, and market data. This is not personalized investment advice.

Our View

The Verdict

Silvaco provides TCAD, EDA, and semiconductor IP software. Its FTCO AI/ML offering builds a digital twin of manufacturing processes and simulates fabrication in real time. That matters because advanced chip processes are becoming too complex to develop with physical pilot wafers alone, pushing the industry toward virtual process development.

Market Cap	—
Revenue (TTM)	$67M
Revenue Growth	+15.2%
EBITDA Margin (TTM)	-38.9%

Net Cash	$9M
Earnings Beats	3 of 7
P/E (TTM)	—
EV/EBITDA (TTM)	—

What We Like

$20M annualized non-GAAP spending reduction executed as of Q2 FY2026.
Non-GAAP operating profit of $635K in Q2 FY2026, the first since late 2024.
IP pipeline up more than 4x year over year; IP revenue grew 238% YoY in Q2.
Micron invested $10M in a convertible note and deepened FTCO collaboration.
Management guides FY2026 revenue above $70M and 2027 double-digit growth with profitability.

What We’re Watching

Q2 bookings missed the $19M ±10% guide; Q3 guide is also sequentially lower.
FTCO has not hit the S-curve inflection, per the CFO.
Customer concentration: Customer A was 24% of Q1 FY2026 AR, and Customer B was 14% of FY2025 revenue.
Q2 non-GAAP gross margin of 86.8% came in below the around-88% guide on mix.

Bottom Line

The thesis is intact but not fully proven. Profitability and cash milestones plus Micron, NVIDIA, and Dassault validation strengthen the story, but the Q2 bookings miss and pre-inflection FTCO keep it from full strengthening. The open question is whether the guided record Q4 and more FTCO wins convert into durable demand.

Next upQ3 FY2026 results test management's $17M revenue and $18M bookings guides; a second bookings miss would raise doubts about the record Q4. Q4 FY2026 then tests whether revenue exceeds the prior record of about $18.7M.

Last Quarter — Q1 FY2026

Earnings

Silvaco reported Q2 FY2026 revenue of $17.8 million, up 48% year over year. GAAP gross margin was 85.2%, and non-GAAP gross margin was 86.8%. Non-GAAP operating profit was $635,000, the first since late 2024. Bookings of $16.2 million grew 25% year over year but came in below the $19 million ±10% guide.

Metric	Q1 FY2026	Q4 FY2025	Q1 FY2025	YoY
Revenue	$18M	$18M	$14M	+26.2%
Gross margin	81.0%	83.3%	78.6%	+240bps
EBITDA	−$3M	−$6M	−$19M	−84.9%
EPS	$-0.19	$-0.23	$-0.67	−72.1%
Bookings	$16.2M	$17.2M	n/a	+25% YoY

Non-GAAP operating profit was $635,000, well ahead of Q1 and ahead of prior expectations. This is the first quarter since late 2024 when the company delivered a non-GAAP operating profit.— Chris Zegarelli, CFO, August 6, 2026

Management tone: Management's tone shifted from a Q1 emphasis on cost cuts and a path to profitability to a Q2 emphasis on delivered milestones and a longer horizon. The CFO said FTCO has not hit the S-curve inflection; the CEO reframed FTCO as longer-term growth. Management acknowledged the Q2 bookings miss with a lumpiness explanation.

Management Guidance

For Q3 FY2026, management guided bookings of $18 million ±10%, revenue of $17 million ±10%, non-GAAP gross margin around 88%, and non-GAAP operating expenses of $14.5 million ±5%. Management also said it expects record revenue in Q4, full-year 2026 revenue above $70 million, and for 2027 double-digit revenue growth with non-GAAP operating profitability and positive cash flow from operations.

Business Trajectory

Trajectory

Revenue has been uneven: $18.7M in Q3 FY2025, $18.3M in Q4, then $17.8M in each of Q1 and Q2 FY2026. The 48% year-over-year jump in Q2 came from an easy comparison against the prior year's $12.0M quarter. Bookings declined sequentially from $17.2M in Q1 to $16.2M in Q2 and missed the $19M ±10% guide. Margins are improving year over year, but Q2 non-GAAP gross margin of 86.8% came in below the around-88% guide on mix.

Revenue & Margin Trajectory

Gross margin as reported.

Share Price — 12 Months

52-week range $3–$14.

Share Price — 12 Months

52-week range $3–$14.

The Numbers

The Model

The model projects FY+1 revenue of $76 million and EBITDA of $0 million (0% margin), and FY+2 revenue of $92.0 million and EBITDA of $12 million (12.6% margin). Near-term revenue is anchored to management's full-year 2026 'above $70 million' guide and the expected record Q4; FY+2 profitability reflects revenue growth against the completed $20 million cost program and guided OpEx decline.

Revenue & EBITDA Projections

Solid bars are reported actuals; outlined bars are model projections — not company guidance.

Metric	FY2025	Next FY (E)	Following FY (E)
Revenue	$63M	$76M	$92M
YoY Growth	—	+20.4%	+21.1%
EBITDA	−$42M	$0M	$12M
EBITDA Margin	-67.0%	0.0%	12.6%

Projections are the median of 5 independent model runs. The model’s revenue sits 11.8% above analyst consensus.

What Could Go Right — and Wrong

What good looks like

FTCO cadence accelerates beyond one new customer per quarter; management expects more wins through year-end.
IP continues record growth toward about $20M in 2026; pipeline is up more than 4x year over year.
NVIDIA or Dassault partnerships convert to named deployments or revenue.
Q4 record revenue and FY2026 above $70 million are confirmed.
Operating cash flow turns positive later in 2026 and stays positive into 2027.

What could go wrong

Q3 bookings or revenue miss again, putting the record Q4 and full-year guide on a single quarter.
FTCO remains pre-inflection and the one-per-quarter cadence does not accelerate.
A major unnamed customer is lost or delays: Customer A is 24% of AR, Customer B is 10%+ of revenue.
EDA remains soft and strategically deprioritized; management does not expect it to be a major near-term growth driver.
A past material weakness in internal control over financial reporting remains disclosed as a risk.

What’s Next

Looking Ahead

The next twelve months hinge on Q3 bookings and revenue landing within guidance, a record Q4 above about $18.7M, and FTCO customer announcements through year-end. IP must continue toward the ~$20 million 2026 expectation despite quarterly lumpiness. Positive operating cash flow, originally 'by Q3,' is now guided 'later in the year' and is the key self-sufficiency marker. Micron's $10 million note closed in Q3 and should show in the Q3 cash balance, while the $10 million revolver close remains unconfirmed.

Catalysts

Q3 FY2026Q3 FY2026 results — Tests $17M revenue and $18M bookings guides; Q4 record depends on it.
H2 2026FTCO customer announcements — Management expects more FTCO wins through year-end; possible cadence acceleration.
Q4 FY2026Record Q4 revenue confirmation — Revenue above ~$18.7M; 'highest quarter ever.'
Later 2026Positive operating cash flow — Timing slipped from 'by Q3' to 'later in the year.'
FY2026Full-year revenue above $70M — Depends on Q4 record and IP toward ~$20M.
FY20272027 profitability and cash flow — Double-digit revenue growth; non-GAAP op profit and positive OCF.

Numbers

Financials

Annual Summary

Metric	FY2024	FY2025	TTM	YoY
Revenue	$60M	$63M	$67M	+5.5%
Gross Margin	79.0%	77.7%	78.9%	135bps
EBITDA	−$39M	−$42M	−$84M	-8.5%
EBITDA Margin	-65.2%	-67.0%	-38.9%	182bps
Net Income	−$39M	−$41M	−$28M	-4.6%
Free Cash Flow	−$88M	−$34M	−$132M	—
Net Cash	—	—	—	—

Key Ratios (Trailing)

Valuation

P/E TTM—
EV/EBITDA TTM—
EV/Revenue TTM—
Price/FCF TTM—

Profitability

Gross Margin (TTM)78.9%
EBITDA Margin (TTM)-38.9%
Net Margin (TTM)-41.6%
ROIC-35.4%
SBC / Revenue17.2%

Reference

The Company

Silvaco makes TCAD, EDA, and semiconductor IP software used by engineers to optimize semiconductor manufacturing processes and bring chips to market. Its FTCO AI/ML offering builds a digital twin of manufacturing processes, simulating fabrication in real time; this matters as process complexity pushes development toward virtual rather than pilot-wafer approaches.

Silvaco operates as a single reportable segment with software-heavy revenue. In Q1 FY2026, software license revenue was $11.6 million and maintenance and service was $6.1 million. The company runs no fabs or data centers; facilities are leased offices, with headquarters in Santa Clara, California and international offices in China, Egypt, France, Japan, Korea, Singapore, Taiwan, the UK, and Vietnam.

Business Segments

TCAD

$9.6M in Q1 FY2026, about 54% of revenue

FTCO AI/ML digital twin plus traditional TCAD process development tools.

Growth driver: FTCO wins plus TCAD renewals.

EDA

$4.1M in Q1 FY2026, about 23% of revenue

IC-CAD signoff, standard cell libraries, IP management; Jivaro Pro and AI-driven Utmost.

Growth driver: Core tools like Jivaro Pro and Utmost.

$4.0M in Q1 FY2026, about 22% of revenue; +238% YoY in Q2

Mixel MIPI PHY, logic/physical IP, embedded memory, automotive IP.

Growth driver: Pipeline up more than 4x year over year.

Competitive Landscape

The 10-K says Silvaco competes most frequently with Synopsys, Siemens EDA, and Cadence, and also lists Keysight, Schrödinger, CEVA, Zuken, Huada Empyrean, M31, and Primarius among other tools providers and IP companies. The 10-Q adds that AI-native and large technology companies are increasingly entering adjacent software markets.

Synopsys, Inc.
Named in 10-K as one of the companies Silvaco competes with most frequently.
Siemens EDA
Named in 10-K as one of the companies Silvaco competes with most frequently.
Cadence, Inc.
Named in 10-K as one of the companies Silvaco competes with most frequently.
Keysight Technologies, Inc.
Listed in 10-K among other tools providers and IP companies; not discussed.
CEVA, Inc.
Listed in 10-K among other tools providers and IP companies; not discussed.

Competitor names are from the 10-K; view fields reflect only the filing's stated relationships.

Supply Chain

Silvaco sits between semiconductor process and manufacturing complexity and chip design, supplying simulation and IP software. No neighbor in the provided source set mentioned SVCO by name.