Valens Semiconductor (NYSE:VLN) reported first-quarter 2026 revenue above its guidance range and reaffirmed its full-year outlook, while executives pointed to continued adoption of newer audio/video chips and progress in automotive connectivity standards.
Chief Executive Officer Yoram Salinger said the company’s first-quarter results were in line with expectations despite previously discussed macroeconomic conditions and a slower pace of technology adoption. Revenue for the quarter was $16.9 million, above the company’s guidance range of $16.3 million to $16.7 million. GAAP gross margin was 62.2%, also above guidance, and adjusted EBITDA was a loss of $5.5 million, better than the expected loss range.
“Our first quarter was in line with our expectations,” Salinger said. “Nevertheless, we are pleased to report that our revenues exceeded the top end of our guidance.”
First-Quarter Revenue Edges Above Prior-Year Level
Chief Financial Officer Guy Nathanzon said first-quarter revenue of $16.9 million compared with $19.4 million in the fourth quarter of 2025 and $16.8 million in the first quarter of 2025.
The company’s Cross-Industry Business, or CIB, generated $11 million, representing about 65% of total revenue. Automotive revenue was $5.9 million, or about 35% of revenue. In the prior quarter, CIB revenue was $13.9 million and automotive revenue was $5.5 million. In the first quarter of 2025, CIB revenue was $11.7 million and automotive revenue was $5.1 million.
Nathanzon said gross profit was $10.5 million, compared with $11.7 million in the fourth quarter of 2025 and $10.6 million in the first quarter of 2025. GAAP gross margin was 62.2%, compared with 60.5% in the prior quarter and 62.9% a year earlier. Non-GAAP gross margin was 65.2%.
By segment, CIB gross margin was 70.8%, while automotive gross margin was 46.2%. Nathanzon attributed the sequential increase in CIB gross margin mainly to product mix.
Operating expenses totaled $19.4 million, down from $20.9 million in the fourth quarter and $20 million in the year-earlier quarter. Research and development expense was $10.3 million, while SG&A expense was $9.4 million.
GAAP net loss was $8.3 million, compared with a net loss of $8.8 million in the fourth quarter of 2025 and $8.3 million in the first quarter of 2025. GAAP loss per share was $0.08, while non-GAAP loss per share was $0.05.
Audio/Video Business Sees Product Launches Around New Chips
Salinger highlighted adoption of the company’s VS3000 chip in the audio/video market, saying the chip is designed to extend uncompressed HDMI 2.0 over widely used category cables. He said additional products based on the chip reached the market during the quarter, including Extron’s DTP3 CrossPoint 42 series matrix switches for premium collaboration spaces.
According to Salinger, Valens’ chip supports uncompressed video, audio and controls up to 330 feet in that product. He called the VS3000 “the most advanced HDBaseT chip we offer” and said it is a pillar of the company’s growth opportunity in its core audio/video market.
The company also cited momentum for its VS6320 chip, which Salinger described as the first and only high-performance USB 3.2 extension solution built on a dedicated chip. He said another major AV manufacturer released a product based on the VS6320 during the quarter.
Valens showcased both chips at CES in January and ISE in February. Salinger said customers and partners responded positively to demonstrations involving multi-camera extension over a single category cable, uncompressed 4K video extension, USB 3 infrastructure supporting multiple cameras and sources, and USB-C to USB-C extension for room conferencing setups.
Automotive Focus Remains on A-PHY and VA7000
In automotive, Salinger said the company’s opportunity is centered on the VA7000 chipset, which supports connectivity for cameras and radars used in advanced driver-assistance systems and autonomous driving. He said VA7000 is the first chipset on the market to comply with the MIPI A-PHY standard.
Salinger emphasized the importance of interoperability in automotive standards, saying the industry is working to move away from proprietary solutions because of concerns around vendor lock-in and supply chain uncertainty.
During the quarter, Valens demonstrated interoperability at Auto China, connecting Valens deserializers to A-PHY serializers from two other SerDes vendors. Salinger described it as “the first three-company demonstration of any interoperable SerDes connectivity solution anywhere in the world for any SerDes standard.”
He said the demonstration reinforced a key value proposition of A-PHY: reducing vendor lock-in, lowering supply chain risk and enabling a more flexible multi-vendor ecosystem for automakers.
In response to an analyst question, Salinger said automotive strength in the quarter was related to Mercedes demand and vehicle sales. He said A-PHY projects are expected to factor into results in 2027, adding that those projects are advancing in line with timelines.
Second-Quarter and Full-Year Outlook Reaffirmed
For the second quarter of 2026, Valens expects revenue of $17.2 million to $17.6 million, gross margin of 60% to 62%, and an adjusted EBITDA loss of $4.9 million to $4.4 million.
The company reaffirmed its full-year revenue guidance of $75 million to $77 million. Asked about the implied second-half acceleration, Salinger said the second half of 2026 is expected to be “way stronger” than the first half, citing design wins and design-ins into customer products, along with visibility into product launches expected to drive growth in the third and fourth quarters.
Salinger said the company expects CIB to grow in the second quarter and accelerate further in the second half. He said Valens sees about 5% growth for CIB across the year.
On macro conditions, Salinger said Valens does not currently see any effect from tariffs. He noted that supply chain conditions remain challenging because of increased demand tied to AI, memory and silicon, but said the company does not see a risk to its ability to meet its targets for the year.
CFO to Depart in July
Nathanzon announced that he will leave Valens on July 13 to pursue new opportunities. He thanked the company’s team and said Valens has “incredible technology” in demand across industries.
Salinger thanked Nathanzon for his contributions and said the company has initiated a search for a replacement.
Valens ended the quarter with $86.1 million in cash, cash equivalents and short-term deposits, and no debt. That compares with $92.6 million at the end of the fourth quarter of 2025 and $112.5 million at the end of the first quarter of 2025. Working capital was $91.3 million, and inventory was $10.9 million as of March 31, 2026.
About Valens Semiconductor (NYSE:VLN)
Valens Semiconductor Corp. is a provider of high-speed connectivity solutions, specializing in semiconductor chipsets that enable the transmission of uncompressed video, audio and data over common cabling such as twisted-pair and coax. The company's flagship technology, HDBaseT, supports the simultaneous delivery of multiple signal types—including HDMI, USB, Ethernet and power—over a single cable. This multi-service approach addresses the growing demands of both consumer electronics and automotive infotainment systems, where bandwidth, reliability and low latency are critical.
Founded in 2012 and headquartered in Israel, Valens maintains research and development operations across North America, Europe and Asia.
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