The megatrends of electric cars and renewable energy are driving increased demand for power semiconductors capable of operating at higher voltages and temperatures. That's led to a spike in demand for so-called wide-bandgap semiconductors that use new chip chemistries, such as gallium nitride and silicon carbide.
Torrance, Calif.-based Navitas Semiconductors is a pure play in the next-generation power semiconductor market. It manufacturers power semiconductors that use gallium nitride, or GaN, and silicon carbide, or SiC. Both types of chips are experiencing fast growth as they replace traditional silicon chips in the power semiconductor market.
Market research firm Yole Group predicts that sales of GaN power chips will grow to $2.04 billion in 2028 from $184.9 million in 2022. Growth will be fueled by a mix of consumer device, telecom, automotive and industrial applications, it said.
Yole forecasts sales of SiC power chips will increase to $8.91 billion in 2028 from $1.79 billion in 2022. It sees automotive accounting for 74% of SiC chip sales in 2028, up from 70% last year.
A small player in the market today, Navitas competes with Infineon, Onsemi, Power Integrations, STMicroelectronics, Wolfspeed and others in power semiconductors.
Fast And Nimble In Big Market
Navitas Chief Executive Gene Sheridan told Investor's Business Daily that his company has an edge over peers because it is focused solely on power semiconductors and offers both GaN and SiC chips.
"We're of the size where we can be faster, more focused and nimble," Sheridan said. "I love this field because it's huge — a $20 billion to $30 billion market — but it's dominated by big, slow, mature guys."
Navitas is more responsive to customer needs, he said. And because it offers both GaN and SiC chips, it can find the best solution for them, especially in the middle ground where the two technologies compete, Sheridan said.
GaN vs. SiC Power Semiconductors
GaN is best for devices with low to medium power and voltage requirements. SiC is better suited for medium to high power and voltage applications.
Both types of chips are "really strong growth engines," Sheridan said. GaN and SiC chips can provide faster charging, faster switching, higher power density and greater energy savings vs. silicon chips.
Under 1,000 volts and 10,000 watts is the "sweet spot" for GaN chips, Sheridan said. Above those levels is SiC chip territory, he said.
GaN chips are found mostly in mobile devices and chargers, home appliances and consumer electronics.
SiC chips are ideal for electric vehicles, commercial solar and wind power, and industrial machine applications.
"We have the best versions of each," Sheridan said. "It puts us in a very unique spot to work with all of those customers very objectively."
GaN Chips Moving Upmarket
GaN power semiconductors are less expensive to produce than SiC semiconductors and have been moving into higher power markets such as data centers, Sheridan said.
On Sept. 7, Navitas launched a new, high-performance GaN power platform for demanding, high-power applications in data centers, solar and energy storage and EV markets. The new chips, branded GaNSafe, are manufactured by chip foundry Taiwan Semiconductor Manufacturing.
Another advantage Navitas has in power semiconductors is that it's been able to make GaN integrated circuits, not just transistors, Sheridan said.
Navitas Focused On Growth
Navitas went public in October 2021 with shares trading near $10 a share. Shares climbed to an all-time high of 22.19 in November 2021 before taking a swoon. Navitas stock bottomed out at 3.11 last December and has moved higher in fits and starts since then.
Navitas stock ended regular session trading on Thursday at 7.77.
Investors have taken notice of the company's blistering sales growth. Analysts polled by FactSet expect Navitas sales to jump 104% to $77.3 million in 2023. They forecast sales rising 89% to $146.4 million in 2024.
But Wall Street predicts Navitas will lose 23 cents a share in 2023, followed by a loss of 13 cents a share in 2024.
Navitas forecasts turning profitable in late 2024 or early 2025, Sheridan said.
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