Napatech: First major design win secured - ABG

First IPU design win with Tier 1 server OEM
We lift '26e EBIT by 111%
New guidance implies P/E of 3.6-7.3x


First IPU design win secured, guidance raised

Napatech's Q1 trading update showed revenue of DKK 21.5m, 47% below ABGSCe driven by an inventory reduction at a large customer, although it still reiterated its '24 guidance of DKK 170-180m. The key news, however, is that Napatech has secured the first design win for the new IPU products developed in partnership with Intel, a major milestone and proof-of-concept. The design win is with a tier-1 server OEM (likely Dell, HP or Lenovo), which will likely demand a large volume. As a result, Napatech raised its volume guidance by 20k units to 50k-60k units at peak production, up from 30k-40k previously. It reiterates that it expects 4-6 design wins in 2024, meaning there is likely more to come, although not all will be the same size as this.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/Napatech/Equity-research/2024/5/napatech---first-major-design-win-secured/