Napatech: Waiting for more design wins - ABG

Q3 in line, limited news on design wins
Reiterates target of 4-6 design wins in 2024
Ambition of 50-60k units implies P/E of 4.2-2.4x


Q3 in-line, a small new design win

Q3 revenue of DKK 34m and EBITDAC of DKK -19m was as we expected. Cash burn was DKK 27m, offset by debt, i.e. the cash position of DKK 103m was flat q-o-q. Napatech announced one new IPU design win with the startup Myrtle.AI, which could be up to ~1k units p.a. The company has thus announced 3 IPU design wins so far in 2024, but in our estimates we only include 20k units from the first design win with a Tier 1 server OEM, as the potential with the startups SigmaX.AI and Myrtle.AI are highly uncertain in our view. Napatech says it has made good progress on potential new designs, but '24 is soon over, and it needs to deliver at least one more design win before YE to meet its guidance of 4-6 design wins this year. One new design that could potentially land before YE is the streaming service provider (which we believe is Disney+), with potential of ~5k/units p.a.

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/Napatech/Equity-research/2024/11/napatech---waiting-for-more-design-wins/