Peraso Inc. (PRSO) Q4 2025 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call presents a mixed outlook. Positive aspects include improved full-year financial metrics, cost containment, and growth expectations in mmWave products. However, the Q4 results show declining margins and increased losses, and management's reluctance to provide specific guidance on key deals raises concerns. The Q&A highlights potential growth in new markets and partnerships, but the impact of delayed orders and uncertain revenue timelines tempers optimism. Overall, the sentiment is neutral as positive long-term prospects are offset by short-term challenges.
Key Financial Performance
Total net revenue for Q4 2025 $2.9 million, a decrease from $3.7 million in Q4 2024. The decline was primarily due to reduced shipments of memory IC products, which were partially offset by increased shipments of mmWave products.
Full year 2025 net revenue $12.2 million, a decrease from $14.6 million in 2024. The decline was attributed to reduced shipments of memory IC products.
Product revenue for Q4 2025 $2.8 million, down from $3.7 million in Q4 2024. The decrease was due to the reduction in shipments of memory IC products, partially offset by increased shipments of mmWave products.
Full year 2025 product revenue $11.8 million, a decrease from $14.2 million in 2024. The decline was due to reduced shipments of memory IC products.
Sales of mmWave products for Q4 2025 $2.4 million, a significant increase from $0.2 million in Q4 2024. This growth was driven by increased shipments of mmWave products.
Total sales of mmWave products for full year 2025 $9.1 million, a substantial increase from $1.3 million in 2024. The growth was due to increased shipments and new design wins.
GAAP gross margin for Q4 2025 52.2%, down from 56.3% in Q4 2024. The decrease was due to reduced shipments of memory IC products.
Full year 2025 GAAP gross margin 58%, an increase from 51.7% in 2024. The improvement was due to increased mmWave margins and reduced amortization expense for memory IC products.
Non-GAAP gross margin for Q4 2025 52.2%, down from 71.6% in Q4 2024. The decline was due to reduced shipments of memory IC products.
Full year 2025 non-GAAP gross margin 58%, a decrease from 67.2% in 2024. The decline was due to reduced shipments of memory IC products.
GAAP operating expenses for Q4 2025 $2.8 million, down from $3.7 million in Q4 2024. The decrease was due to reduced stock-based compensation and amortization expenses.
Full year 2025 GAAP operating expenses $11.8 million, a significant decrease from $20 million in 2024. The reduction was due to lower stock-based compensation, amortization expenses, and severance costs.
Non-GAAP operating expenses for Q4 2025 $2.7 million, down from $3.2 million in Q4 2024. The decrease was due to cost reductions and ongoing cost containment initiatives.
Full year 2025 non-GAAP operating expenses $11.3 million, a decrease from $14.9 million in 2024. The reduction was due to cost containment initiatives and lower software license obligation costs.
GAAP net loss for Q4 2025 $1.2 million or $0.13 per share, an improvement from a net loss of $1.6 million or $0.37 per share in Q4 2024. The improvement was due to reduced operating expenses.
Full year 2025 GAAP net loss $4.8 million or $0.67 per share, an improvement from a net loss of $10.7 million or $3.57 per share in 2024. The improvement was due to reduced operating expenses.
Non-GAAP net loss for Q4 2025 $1.2 million or $0.13 per share, compared to a net loss of $0.5 million or $0.13 per share in Q4 2024. The increase in loss was due to reduced shipments of memory IC products.
Full year 2025 non-GAAP net loss $4.3 million or $0.60 per share, an improvement from a net loss of $5.1 million or $1.71 per share in 2024. The improvement was due to cost containment initiatives.
Adjusted EBITDA for Q4 2025 Negative $1.1 million, compared to negative $0.4 million in Q4 2024. The decline was due to reduced shipments of memory IC products.
Full year 2025 adjusted EBITDA Negative $4 million, an improvement from negative $4.5 million in 2024. The improvement was due to cost containment initiatives.
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Operating Highlights
mmWave product revenue growth: Revenue from mmWave products grew approximately 6-fold compared to 2024, driven by increased product shipments and new design wins.
DUNE platform adoption: Sustained uptake by customers for high-speed wireless broadband deployments in dense urban environments.
Tactical communications market entry: Transitioned from conceptual military defense application to a definitive new market vertical with high growth potential.
Edge AI applications: Collaborated with Virewirx to power VX60 platform for robotaxi fleet vehicles, addressing high-bandwidth video processing challenges.
Fixed wireless access market: Primary driver for mmWave revenue growth in 2025, with notable traction in North America and Africa.
Tactical communications market: Expanded presence with InTACT as a lead defense contractor, focusing on battlefield communication systems.
Adjacent markets: Explored opportunities in Edge AI, autonomous vehicles, and drones, diversifying revenue base.
Expense management: Maintained tight control over operating expenses, contributing to improved bottom-line results.
Revenue impact from supplier delay: A $0.5 million revenue impact in Q1 2026 due to delayed shipment of key materials.
Strategic alternatives exploration: Ongoing review of potential mergers, asset sales, or other transactions to enhance company value.
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Risk or Challenges
Delayed Shipment Impact: An unexpected delay in the receipt of key materials from an Asia-based supplier, stuck in customs, is anticipated to negatively impact Q1 2026 revenue by more than $0.5 million. This delay affects the company's ability to fulfill a significant order on time.
Revenue Decline: Total net revenue for 2025 decreased to $12.2 million from $14.6 million in 2024, primarily due to reduced shipments of memory IC products, which have reached end-of-life.
Lower Visibility into Demand: The company faces challenges in forecasting future demand due to irregular order patterns from fixed wireless access customers and new customers without established order histories.
Strategic Alternatives Uncertainty: The ongoing exploration of strategic alternatives, including potential mergers or sales, introduces uncertainty about the company's future direction and operations.
Dependence on Key Suppliers: The delayed shipment highlights the company's vulnerability to supply chain disruptions, particularly from key suppliers in Asia.
Customer Concentration Risk: The company relies heavily on a few key customers for its mmWave products, which could pose risks if these customers reduce or delay orders.
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Guidance & Outlook
Revenue Expectations: The company expects total net revenue for the first quarter of 2026 to be approximately $1.2 million, assuming no contribution from a delayed order shipment.
Market Trends and Growth Expectations: Peraso anticipates continued year-over-year growth in mmWave revenue and operating results for 2026, driven by broadening customer base and pipeline of design wins across fixed wireless access and tactical communications, as well as selective high-growth opportunities in adjacent markets such as Edge AI.
Product Launch and Market Penetration: The company highlights the potential of its 60 gigahertz mmWave technology in various applications, including fixed wireless access, tactical communications, and Edge AI. Recent collaborations, such as with Virewirx for robotaxi fleet vehicles, are expected to expand the addressable market and diversify revenue sources.
Operational Challenges: An unexpected delay in the receipt of key materials from an Asia-based supplier is anticipated to negatively impact first-quarter revenue by more than $0.5 million. The delayed shipment is expected to be fulfilled in the second quarter.
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Shareholder Return Plan
The selected topic was not discussed during the call.
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Key Q&A
Q:When should revenues from the InTACT deal begin to start coming in, and what is the total revenue opportunity?
A:Revenues from the InTACT deal are currently 90% nonrecurring engineering (NRE) and 10% product revenue. The shift to production revenue is expected in the second half of 2026. The company is focusing on reducing power consumption as part of its efforts.
Q:Can you quantify the number of customers in active conversations and provide details on the segments?
A:The company is in active conversations with 3 to 5 customers, primarily Fortune 100 companies. For example, in the robotaxi segment, production could begin at the end of this year or early 2027. The demand for high data rate systems is significant, and partnerships like the one with Virewirx are key to addressing these opportunities.
Q:Are you seeing inbound interest due to current conflicts, particularly for drone applications?
A:Yes, there is significant interest in the friend-or-foe identification system developed with InTACT, especially for drone swarms. This system addresses the need to identify friendly drones and avoid friendly fire. The interest in this solution has grown substantially.
Q:What is the status of the FWA business and inventory levels with customers?
A:The company expects customer orders to be replenished in Q3 and Q4. A large shipment with MikroTik was delayed from Q1 to Q2, but this is not expected to have a material impact on the order pipeline for the year.
Q:Does the delay in the large order from Q1 to Q2 impact order patterns for the rest of the year?
A:The delay will result in a 2 to 3-week shift in the order pipeline but is not expected to have a significant material impact on the overall order patterns for the year.
Q:Are there plans to increase investments in R&D or other areas due to new opportunities like InTACT?
A:The company charges customers for engineering and R&D efforts, ensuring that customers contribute significantly to these projects. This approach validates the market and funds R&D expenses. The company also works with customers on exclusivity agreements and aims to expand its product portfolio through these collaborations.
Q:Review of Unclear Management Responses
A:Management avoided providing specific revenue figures for the InTACT deal and did not explicitly quantify the total revenue opportunity. Additionally, confidentiality was cited as a reason for not naming specific customers in active conversations.
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Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
AI application
DUNE platform
Edge AI
InTACT Peraso
Peraso gigahertz
Slide access
VX
access communication
access market
awareness gigahertz
battlefield
beam
characteristic
contractor customer
cost deployment
customer InTACT
detection
drone identification
end market
field trial
friend foe
generation drone
gigahertz mmWave
gigahertz technology
identification friend
line
milestone collaboration
mmWave product
opportunity market
power
probability
robotaxi
technology mission
terabyte
vehicle AI
video
PRSO Transcript
Peraso Inc. (PRSO) Q4 2025 Earnings Call Transcript
Unknown3-16
The earnings call presents a mixed outlook. Positive aspects include improved full-year financial metrics, cost containment, and growth expectations in mmWave products. However, the Q4 results show declining margins and increased losses, and management's reluctance to provide specific guidance on key deals raises concerns. The Q&A highlights potential growth in new markets and partnerships, but the impact of delayed orders and uncertain revenue timelines tempers optimism. Overall, the sentiment is neutral as positive long-term prospects are offset by short-term challenges.
Peraso Inc. (PRSO) Q3 2025 Earnings Call Transcript
Positive11-10
The earnings call highlights strong growth in mmWave product revenue and an increase in gross margins, despite a slight year-over-year revenue decrease. The Q&A section reveals positive sentiment towards the company's OEM partnerships and fixed wireless access market potential. The company's strategic focus on expanding its market presence and managing working capital efficiently further supports a positive outlook. Although some management responses were vague, the overall sentiment remains positive, with optimistic guidance and strategic market expansion efforts likely to boost the stock price.
Peraso Inc. (PRSO) Q2 2025 Earnings Call Transcript
Unknown8-11
The earnings call presents a mixed picture: strong MMWave revenue growth and a solid customer engagement pipeline are positive, but declining gross margins and a significant GAAP net loss raise concerns. The Q&A reveals optimism in military applications and NRE deals, yet management's vague responses on acquisition offers and BEAD funding impact add uncertainty. Given these factors, the stock's reaction is likely to be muted, resulting in a neutral sentiment.
Peraso Inc. (PRSO) Q1 2025 Earnings Call Transcript
Positive5-12
The earnings call reveals strong financial performance with record revenue growth, a significant increase in gross margin, and improved net loss figures. The Q&A section highlighted positive sentiment from analysts, especially regarding military and global interest in mmWave technology. Despite some uncertainties in regulatory and cash flow risks, the optimistic guidance for mmWave revenue growth, increased demand, and government funding support suggest a positive stock price movement. The lack of a share repurchase program is a minor negative but does not outweigh the overall positive outlook.
PRSO Report
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