SkyWater Technology Reports 162% Revenue Growth to $160.7 Million in Q1 2026

SkyWater Technology, Inc. reported significant financial growth in its latest quarterly filing, with revenues reaching $160.7 million for the first quarter of 2026, a substantial increase of 162% compared to $61.3 million in the same period last year. The company's gross profit also rose to $32.2 million, up 126% from $14.3 million in the prior year. However, despite this revenue surge, SkyWater recorded a net loss of $12.3 million, which is a 68% increase from the $7.3 million loss reported in the first quarter of 2025. The increase in losses was attributed to higher operational costs, particularly in interest expenses, which surged to $6.2 million from $1.8 million, reflecting increased borrowings under the company's revolving credit facility.

The financial performance was bolstered by the acquisition of Fab 25, which contributed significantly to the revenue growth, particularly in the Wafer Services segment, which saw an increase of $88.3 million. This acquisition expanded SkyWater's manufacturing capacity and allowed for a notable contribution of $10.2 million in non-cash revenue associated with an off-market component of a supply agreement. The ATS development revenue also saw a modest increase of 5%, driven by growth in the advanced compute industry, although this was partially offset by a decline in aerospace and defense revenue due to shifts in U.S. government policy.

Operationally, SkyWater's total assets remained relatively stable at $732.9 million as of March 29, 2026, compared to $733.9 million at the end of the previous fiscal year. The company reported a slight decrease in cash and cash equivalents, totaling $22.2 million, down from $23.2 million. The company’s employee headcount and customer base have also expanded, reflecting its growth strategy and increased production capabilities. The company operates two distinct segments following the acquisition: Legacy SkyWater and SkyWater Texas, which allows for a more focused approach to its diverse customer needs.

Looking ahead, SkyWater's management expressed optimism about future growth, particularly with the anticipated benefits from the Fab 25 acquisition and ongoing customer-funded capital investments. The company is also navigating the complexities of its pending acquisition by IonQ, which is expected to close in the second or third quarter of 2026, subject to regulatory approvals. This merger is anticipated to enhance SkyWater's operational capabilities and market position, although it also introduces uncertainties related to integration and potential impacts on existing customer relationships.

In summary, while SkyWater Technology, Inc. has demonstrated impressive revenue growth and operational expansion, it continues to face challenges in profitability and operational costs. The company remains focused on leveraging its recent acquisitions and strategic partnerships to drive future growth and enhance its competitive position in the semiconductor industry.