QuickLogic Corp. (QUIK) - Form 10-Q Summary
Business Context and Reporting Period
Company: QuickLogic Corporation (fabless semiconductor company specializing in eFPGA IP and programmable logic solutions).
Reporting Period: Quarterly period ended June 28, 2026 (Q2 2026) and the six months ended June 28, 2026.
Operational Status: The Company operates as a single reportable segment. It has classified its SensiML subsidiary as "Discontinued Operations" and is actively exploring options for its sale. The Company focuses on eFPGA IP licensing, professional services, and discrete FPGA devices for aerospace, defense, and industrial markets.
Key Financial Metrics
| Metric (in thousands) | Q2 2026 (3 Months) | Q2 2025 (3 Months) | YTD 2026 (6 Months) | YTD 2025 (6 Months) |
|---|---|---|---|---|
| Revenue | $5,482 | $3,687 | $10,533 | $8,012 |
| Gross Profit | $2,407 | $954 | $4,249 | $2,831 |
| Gross Margin | 44% | 26% | 40% | 35% |
| Operating Loss | $(1,717) | $(2,522) | $(3,835) | $(4,503) |
| Net Loss (Continuing Ops) | $(882) | $(2,661) | $(3,084) | $(4,751) |
| Net Loss (Total) | $(887) | $(2,670) | $(3,093) | $(4,861) |
| Cash & Equivalents (End of Period) | $18,475 | N/A | $18,475 | N/A |
| Operating Cash Flow (YTD) | $2,190 | $(1,498) | $2,190 | $(1,498) |
| Revolving Credit Facility Outstanding | $5,000 | $15,000 | $5,000 | $15,000 |
Material Changes vs. Prior Period
- Revenue Growth: Revenue increased 49% year-over-year (YoY) in Q2 2026 and 31% YoY for the six-month period. This was driven primarily by a 60% increase in "New Products" revenue (eFPGA IP and professional services).
- Margin Expansion: Gross margin improved significantly from 26% in Q2 2025 to 44% in Q2 2026, attributed to the higher mix of IP licensing revenue.
- Loss Reduction: Net loss from continuing operations narrowed by 67% in Q2 2026 compared to the same period in 2025.
- Unusual Items: The Company recognized a $0.95 million gain on the extinguishment of a vendor payable in Q2 2026, which significantly reduced the net loss. In the prior year (Q2 2025), the Company recorded a $0.3 million impairment charge on a non-marketable equity investment.
- Debt Reduction: The Company reduced its revolving line of credit drawdown from $15.0 million (Dec 2025) to $5.0 million (June 2026) and terminated its previous facility with Heritage Bank, replacing it with a new facility with Sunflower Bank.
Guidance, Outlook, and Risks
- Liquidity: Management believes existing cash ($18.5 million), proceeds from the ATM offering ($9.5 million YTD), and the Revolving Credit Facility are sufficient to fund operations for the next 12 months.
- Capital Raising: The Company sold 903,000 shares under its Amended ATM Offering in the first six months of 2026, generating $9.5 million in net proceeds. A new S-3 Registration Statement allows for up to $125 million in aggregate securities sales.
- Discontinued Operations: The SensiML subsidiary remains classified as held for disposal. No material developments regarding the sale were reported as of June 28, 2026.
- Risks:
- Customer Concentration: Customer "A" accounted for 65% of revenue in Q2 2026 and 67% for the six-month period.
- Bank Concentration: A substantial amount of cash is held at Sunflower Bank, the lender for the Revolving Credit Facility, creating concentration risk.
- Market Cyclicality: Revenue is subject to the cyclicality of the semiconductor industry and the timing of government contracts.
Investor Verification Checklist
- Customer Concentration: Verify the stability of the relationship with Customer "A," which represents over two-thirds of revenue.
- Recurring Revenue Quality: Assess the sustainability of the eFPGA IP and professional services revenue growth, which drove the margin expansion.
- Disposal Timeline: Monitor updates on the potential sale of the SensiML subsidiary and associated costs.
- Debt Covenants: Review compliance with the new Sunflower Bank Revolving Credit Facility covenants, specifically the "Remaining Months Liquidity" (RML) requirement.
- One-Time Gains: Adjust financial analysis to exclude the $0.95 million gain on vendor payable extinguishment to understand core operating performance.