In April, Navitas Semiconductor's (NVTS +25.22%) stock sank to an all-time low of $1.52 per share. That marked a 92% drop from its all-time high of $20.16 in November 2021. The chipmaker's stock plummeted as it broadly missed its own long-term forecasts.
Before Navitas went public by merging with a special purpose acquisition company (SPAC) in October 2021, it claimed its revenue would surge from $12 million in 2020 to $308 million in 2024. But in 2024, the company only generated $83 million in revenue.
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Yet Navitas' stock now trades at about $6. It soared over the past five months as it secured a new data center deal with Nvidia, but are those gains sustainable? Let's review what Navitas does, why the Nvidia deal lit a fire under its stock, and if it's worth buying.
What does Navitas produce?
Navitas produces gallium nitride (GaN) and silicon carbide (SiC) power chips, which are faster, more power-efficient, and more resistant to higher temperatures and voltages than traditional silicon chip devices. That makes them well-suited for electric vehicle (EV) chargers, data center power supplies, solar inverters, industrial motor drives, and mobile chargers. Unlike Wolfspeed, which is grappling with soaring costs as it manufactures its own SiC and GaN chips at its first-party foundries, Navitas is a fabless chipmaker that outsources its production to third-party foundries.
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Key Data Points
Navitas generates most of its revenue from its GaNFast Power ICs, which bundle together switching, sensing, control, and security features on a single chip. But in 2022, it significantly increased its exposure to the SiC market with its acquisition of GeneSiC, which develops SiC chips for the EV and data center markets.
Navitas' top customers include PC makers like Dell and Lenovo, smartphone leaders like Samsung and Xiaomi, and Chinese EV makers like BYD and Changan. This May, Nvidia partnered with Navitas to develop more power-efficient delivery systems for its next-gen artificial intelligence data centers.
Why is Navitas' growth cooling off?
Navitas' sales surged in 2022 and 2023 as the GaN and SiC markets heated up, but that growth spurt ended in 2024 as it dissolved a partnership with a key distributor. Its revenue continued to decline in the first half of 2025 as its mobile and consumer markets faced seasonal headwinds and its EV, solar, and industrial customers reined in their orders to resize their inventories. Its sales in China, which accounted for 60% of its top line in 2024, are also exposed to unpredictable tariffs.
|
Metric |
2022 |
2023 |
2024 |
1H 2025 |
|---|---|---|---|---|
|
Revenue |
$37.9 million |
$79.5 million |
$83.3 million |
$28.5 billion |
|
Revenue Growth (YOY) |
60% |
109% |
5% |
(35%) |
|
Adjusted Gross Margin |
40.8% |
41.8% |
40.4% |
38.3% |
|
Net Income (Loss) |
$75.0 million |
($145.4 million) |
($84.6 million) |
($65.9 million) |
Data source: Navitas Semiconductor. YOY = Year-over-year.
Navitas' deal with Nvidia also won't boost its near-term revenues. It expects to ship the first samples for that collaboration in the fourth quarter of 2025, the final selections to be made in 2026, and the actual mass production of those selected chips to start in 2027.
What's next for Navitas?
For 2025, analysts expect Navitas' revenue to decline 42% to $48.6 million as its net loss widens to $116.4 million. For 2026, they expect its revenue to rise 9% to $53.1 million as it narrows its net loss to $78 million. That recovery should be driven by milder macro headwinds for the EV, solar, and industrial markets. But in 2027, they expect its revenue to surge 79% to $95 million as it starts mass-producing its first chips for Nvidia, while its net loss could narrow to $68 million.
However, that forecast could be too bullish because it hasn't even shipped its first power chip samples to Nvidia. If those chips face delays or production issues, it will struggle to meet Wall Street's rosy expectations for 2027 and beyond. But too much optimism has also been baked into its current valuations. With a market cap of $1.2 billion, Navitas is valued at 24 times this year's sales. That price-to-sales ratio was inflated by its headline-grabbing partnership with Nvidia, but it can't be justified by its near-term growth.
Therefore, Navitas' stock could be cut in half and still be expensive relative to its peers. It had a great run over the past four months, but I doubt it can maintain that momentum in this wobbly market. If you don't already own Navitas' stock, you should probably wait for some clearer updates regarding its future roadmap before buying.
