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SEC filingRevenue declined 11.7% YoY but gross margin surged 840bps to 40.1% on mix shift from Mainland China.
Revenue for Q2 2025 decreased 11.7% YoY to $17.9M, primarily due to the strategic reduction of sales in Mainland China, which fell to 12% of total net sales from 42% a year earlier. Despite the top-line decline, gross profit rose 11.8% to $7.2M, and gross margin expanded 840 basis points to 40.1%. The improvement was driven by a favorable product and customer mix shift toward higher-margin non-Mainland China customers. Operating expenses declined 8.4% overall, with R&D down 5.2% and SG&A down 11.4% (excluding IPO transaction costs in the prior quarter). Net loss narrowed to $8.5M from $10.6M, reflecting the gross margin gains and cost discipline.
Management highlights a geographic realignment. Non-Mainland China revenue surged 34.7% YoY to $15.9M, contributing 89% of total sales (up from 58% in Q2 2024). Gross profit from these customers reached $6.5M, compared to just $0.7M in the prior year, underscoring significantly better margin profiles outside Mainland China. In contrast, Mainland China revenue collapsed to $2.0M (from $8.5M). End-customer concentration remains high: the top 10 customers accounted for 98% of sales in the six months ended June 30, 2025.
The MD&A does not provide explicit quantitative guidance but signals continued strategic prioritization of non-Mainland China opportunities, which management expects to drive margin improvement. The company completed its IPO in July 2025, raising $97.2M net proceeds, strengthening its balance sheet (cash $47.5M at quarter-end). Management expects to continue investing in R&D and incur higher public company costs. No forward revenue or margin targets are given.
As of June 30, 2025, Ambiq Micro held $47.5 million in cash and cash equivalents, a decrease from $61.0 million at December 31, 2024. The company reported a net loss of $16.8 million for the six months ended June 30, 2025, and an operating cash flow deficit of $10.5 million. Total assets stood at $89.2 million, with total liabilities of $18.3 million. The company's stockholders' deficit was -$307.3 million, reflecting accumulated deficits of $337.0 million. Inventories increased slightly to $15.8 million from $15.0 million at year-end 2024. The company has no debt, with total liabilities consisting primarily of accounts payable ($4.6 million), accrued liabilities ($8.4 million), and lease liabilities ($0.9 million).
The company disclosed total manufacturing purchase commitments of $7.7 million as of June 30, 2025. These commitments arise from agreements with third-party foundries and contract manufacturers, though the underlying agreements do not have volume purchase commitments and primarily provide for purchase orders that can be canceled and rescheduled upon agreement. No other material contractual obligations were disclosed.
Ambiq Micro did not repurchase any shares or pay dividends during the period. Capital expenditures were $0.5 million for the six months ended June 30, 2025, representing 1.4% of net sales. The company also invested $2.7 million in intangible assets. No debt was issued or repaid. The company completed its IPO on July 31, 2025, receiving net proceeds of $97.2 million, which will provide additional liquidity.
The company operates as a single reportable segment. The CODM reviews financial information on a consolidated basis. Net sales by end customer geography for the six months ended June 30, 2025 were: United States $28.6 million (85.2%), China $3.0 million (9.0%), and Rest of World $1.9 million (5.8%). By shipment destination, China was the largest at $14.3 million, followed by Taiwan at $12.8 million and Singapore at $5.7 million. The company had three end customers representing 38%, 33%, and 12% of net sales for the three months ended June 30, 2025.
The company's cash flow from operations remained negative at $(10.5) million for the six months ended June 30, 2025, more than doubling the $(5.1) million deficit in the prior year period. The net loss improved to $(16.8) million from $(20.0) million, but operating cash flow deteriorated due to unfavorable working capital changes, particularly a $0.8 million increase in inventories (vs. a $11.0 million decrease last year) and a smaller increase in accounts payable ($0.9 million vs. $0.4 million).
Capital expenditures (property, equipment, and software) totaled $0.5 million, up from $0.2 million, while purchases of intangible assets were $2.7 million. Total investing outflows were $3.1 million. Financing activities provided only $0.2 million from stock option exercises, compared to $51.8 million from preferred stock issuance in 2024.
The combination of operating and investing cash outflows led to a $13.5 million decline in cash and cash equivalents. The company did not pay dividends or repurchase shares during the period.
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