Navitas Semiconductor (NVTS) Shifts Focus to AI Data Centers, Exiting Low-Margin Consumer Chips
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jan 22 2026
0mins
Source: Fool
- Strategic Shift: Navitas Semiconductor is exiting the low-margin consumer chip market to focus heavily on AI data centers, which is expected to enhance overall profit margins and strengthen market competitiveness.
- Market Potential: Should NVIDIA's 800V transition succeed, Navitas's stock could surprise investors, reflecting the company's potential gains in a high-growth sector.
- Investor Interest: The company's focus on AI data centers is likely to attract increased investor attention, especially against the backdrop of rapid technological advancements, potentially driving stock price appreciation.
- Future Outlook: As AI technology continues to evolve, Navitas's strategic adjustment not only aligns with market trends but may also provide long-term growth opportunities, further solidifying its position in the semiconductor industry.
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Analyst Views on NVTS
Wall Street analysts forecast NVTS stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for NVTS is 8.80 USD with a low forecast of 4.20 USD and a high forecast of 13.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
4 Analyst Rating
1 Buy
2 Hold
1 Sell
Hold
Current: 10.190
Low
4.20
Averages
8.80
High
13.00
Current: 10.190
Low
4.20
Averages
8.80
High
13.00
About NVTS
Navitas Semiconductor Corporation is a power-semiconductor company. The Company is engaged in designing, developing and marketing power semiconductors, including gallium nitride (GaN) power integrated circuits (ICs), silicon carbide (SiC) power devices, associated silicon system controllers and digital isolators used in power conversion and charging. Power supplies incorporating its products are used in a variety of electronics products, including fast chargers for mobile phones and laptops, consumer electronics, data centers, solar inverters and electric vehicles, among numerous other applications. Its GaNFast power ICs integrate GaN power and drive, with control, sensing, and protection to enable faster charging, higher power density and energy savings. Its GeneSiC power devices are optimized with reliable SiC solutions. It also offers a range of SiC MOSFETs and diodes, which have lower resistance at higher temperatures, 25°C cooler and have three times longer device life expectancy.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Investment Opportunities in the AI Sector
- SoundHound Growth Potential: SoundHound achieved a record revenue of $42 million in Q3 2025, marking a 68% year-over-year increase, with full-year sales projected between $165 million and $180 million, nearly doubling 2024's figures, indicating strong growth in the AI software sector.
- Navitas Transition Challenges: Navitas saw its revenue plummet to $10.1 million in Q3 2025 from $21.7 million in 2024, coupled with a net loss of $19.2 million, highlighting the difficulties of shifting focus from consumer markets to AI.
- Cost Control Pressure: Despite significant revenue growth, SoundHound's operating costs surged 243% year-over-year to $115.9 million in Q3, raising concerns about its long-term profitability if cost management does not improve.
- Investment Decision Considerations: When evaluating the investment merits of SoundHound versus Navitas, SoundHound's forward sales multiple is at a low point, while Navitas appears overvalued, necessitating cautious investment to mitigate potential risks.
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SoundHound and Navitas Anticipate Strong AI Sales Growth
- SoundHound Sales Surge: SoundHound reported a record revenue of $42 million in Q3 2025, marking a 68% year-over-year increase, with full-year sales projected between $165 million and $180 million, nearly doubling 2024's figures, indicating strong growth potential in the AI voice solutions market.
- Navitas Transformation Challenges: Navitas pivoted to focus on the AI market in 2025, resulting in a dramatic revenue drop to $10.1 million in Q3 2025 from $21.7 million in 2024, highlighting significant challenges during its transition.
- Rising Cost Risks: Despite SoundHound's revenue growth, its operating costs surged by 243% in Q3 2025 to $115.9 million, raising concerns about the sustainability of such expense growth and its long-term profitability.
- Investment Considerations: Between SoundHound and Navitas, the former is viewed as the more attractive investment due to its lower valuation and rising sales, while Navitas requires cautious evaluation due to its high valuation and declining sales.
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