SVCO Stock Forecast & Price Target

Silvaco Group Inc. has demonstrated robust financial performance, reporting Q4 total revenue of $17.9 million, reflecting a 43% year-over-year increase and aligning with market expectations. Maintenance and service revenue increased 6.4% year-over-year to $4 million, while software licenses, which constituted 78% of total revenue, surged by 59% year-over-year to $13.9 million, underscoring strong demand for its core software products. Additionally, the company reported total bookings of $20.3 million, a significant 30.5% year-over-year growth, and RPOs of $34.3 million, with a compound RPO growth of 46%, indicating a positive outlook for future revenue streams.

Silvaco Group Inc. is expected to experience stagnant revenue growth from its significant market in China, which represented 18% of sales in FY24, and is projected to either remain the same or trend lower in FY25. While FY25 revenue growth guidance of 15.5% aligns with market expectations, the company has provided EPS guidance that falls considerably short of consensus estimates due to higher than anticipated operational expenditures. Additionally, concerns about potential technological obsolescence and the assumption that the company's operating margins will not improve sufficiently further contribute to a negative outlook for Silvaco's stock performance.