PDFS · PDF Solutions, Inc.

PDF Solutions delivered a strong first quarter, with total revenue of $60.1 million, up 26% year-over-year, driven by a 36% surge in Platform revenue to $50.9 million. Volume-based revenue declined 12% to $9.2 million, but overall recurring revenue remained high at 89%. The company achieved GAAP net income of $4.8 million ($0.12 per diluted share), a significant turnaround from a net loss of $3.0 million in Q1 2025. Non-GAAP net income rose to $12.6 million ($0.31 per diluted share) from $8.1 million a year ago. Gross margins were stable, with GAAP gross margin at 72% and non-GAAP at 76%. Operating margins improved markedly: GAAP operating margin reached 10% (vs. -7% in Q1 2025) and non-GAAP operating margin hit 25% (vs. 18%), approaching the long-term target of 27%. Management attributed the performance to strong customer adoption, citing a large fabless customer renewing its Exensio commitment, a leading IDM developing next-generation test solutions, and shipment of an eProbe tool to a leading-edge semiconductor company. The company reaffirmed its prior guidance of 20% annual revenue growth for 2026. Ending backlog stood at $246.4 million, providing solid forward visibility. Operating cash flow was $1.7 million, while capital expenditures were $10.5 million, reflecting continued investment. The balance sheet remains healthy with $31.2 million in cash and $66.5 million in net debt.