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How Weaker Q2 Results and China Tariff Risks at Navitas Semiconductor (NVTS) Have Changed Its Investment Story

Simply Wall St · 08/13 07:39
  • Navitas Semiconductor recently announced second-quarter 2025 results, reporting US$14.49 million in sales and a net loss of US$49.08 million, with management providing cautious revenue guidance for the third quarter due to China tariff risks and a more selective mobile business approach.
  • Additionally, Xiaomi revealed that its upcoming 90W GaN charger will use Navitas' GaNSense Control ICs, highlighting continued traction in consumer power applications despite broader operational headwinds.
  • We'll examine how weaker quarterly results and cautious future guidance related to China tariff exposure may influence Navitas Semiconductor's outlook.

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Navitas Semiconductor Investment Narrative Recap

Navitas Semiconductor's investment case is built on the belief that advanced GaN and SiC semiconductors can unlock new growth in AI data centers and energy infrastructure, but recent earnings signal that short-term progress may be hampered by sharp revenue declines, persistent net losses, and heightened exposure to China tariffs. The company's third-quarter outlook and management's warnings around tariff headwinds underscore ongoing risks that could delay the most important catalyst: higher-margin data center and infrastructure revenues offsetting mobile market contraction.

The announcement that Xiaomi will use Navitas' GaNSense Control ICs in its new 90W charger demonstrates that, despite wider operational headwinds, Navitas continues to see adoption in consumer power electronics. However, this visibility is more limited in scope, with the most meaningful near-term shifts still hinging on resolution of China-related revenue pressure and evidence of emerging design wins in premium markets.

Yet, while management emphasizes longer-term opportunities, investors should be mindful that continued volatility in Chinese trade policy could...

Read the full narrative on Navitas Semiconductor (it's free!)

Navitas Semiconductor's outlook anticipates $153.5 million in revenue and $22.1 million in earnings by 2028. This scenario assumes a 31.1% annual revenue growth rate and an earnings increase of $146.6 million from current earnings of -$124.5 million.

Uncover how Navitas Semiconductor's forecasts yield a $6.74 fair value, a 3% downside to its current price.

Exploring Other Perspectives

NVTS Community Fair Values as at Aug 2025
NVTS Community Fair Values as at Aug 2025

Ten fair value estimates from the Simply Wall St Community span US$2.10 to US$26.76, reflecting very different outlooks on Navitas' potential. Ongoing uncertainty about China tariff exposure remains top of mind as you weigh these divergent perspectives.

Explore 10 other fair value estimates on Navitas Semiconductor - why the stock might be worth less than half the current price!

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.