SkyWater Technology, Inc. (SKYT): Business Model Canvas [Dec-2025 Updated]

You're looking to cut through the noise and see the real engine driving SkyWater Technology, Inc., especially after they integrated the Fab 25 facility; well, here's the quick math on their strategy. Forget simple manufacturing; their core is a Technology as a Service (TaaS) model, positioning them as the secure, exclusively U.S.-based foundry for high-value sectors like quantum computing and defense. To give you a concrete sense of scale, their Q3 2025 Wafer Services hit $92.8 million, but the real insight is how their Key Activities-like maintaining DMEA-accredited Trusted Foundry status-directly fuel their Value Proposition to government and commercial innovators. If you want to see precisely how their three fabs, massive co-investment exceeding $350 million, and specialized customer base translate into a cohesive, actionable business structure, dive into the full canvas below.

SkyWater Technology, Inc. (SKYT) - Canvas Business Model: Key Partnerships

You're looking at the core relationships that anchor SkyWater Technology, Inc.'s foundry strategy, especially after the major Texas acquisition. These partnerships are critical for capacity, technology access, and market reach, particularly in specialized, high-trust sectors.

U.S. Department of Defense (DOD) for multiyear development programs

SkyWater Technology, Inc. is a DMEA-accredited Category 1A Trusted Supplier, which is key for DOD work. For the second quarter of fiscal year 2025, management noted that the timing of funding for certain Department of Defense programs was impacted by the U.S. Government operating under a continuing resolution for fiscal year 2025. SkyWater had executed development activities for a couple of DOD programs at a pace above the currently funded level. The company was forecasting Q3 Advanced Technology Services (ATS) revenues of approximately $50 million before adding at least $5 million of incremental revenue from Florida in Q4 2025. However, in the third quarter of 2025, an acceleration of program timing in aerospace and defense markets led to stronger-than-forecast ATS development revenues for that quarter.

Infineon Technologies AG for the Fab 25 supply agreement

SkyWater Technology, Inc. completed the acquisition of Infineon Technologies AG's 200 mm fab, 'Fab 25,' in Austin, Texas, on June 30, 2025. The upfront payment for the transaction was $93 million, fully funded through a new debt facility. This facility provides borrowing capacity up to $350 million. The long-term supply agreement is projected to add approximately $300 million of revenue annually to SkyWater Technology, Inc. The newly acquired SkyWater Texas segment generated $86.6 million in revenue for the third quarter of 2025, with a segment gross margin of 19.9%. Fab 25 was expected to contribute a strong and steady $8 million of Adjusted EBITDA each quarter, representing just over 10% of quarterly revenues. The acquisition also brought over 1,000 former Infineon employees onto the SkyWater Technology, Inc. payroll.

Quantum computing innovators like SQC and QuamCore

Momentum in quantum computing is a significant growth vector. SkyWater Technology, Inc. is on track to exceed 30% revenue growth in quantum computing related ATS revenues in fiscal year 2025. Since the second quarter of 2025, four new ATS engagements with quantum computing companies have been signed, including with Silicon Quantum Computing (SQC) and QuamCore. The collaboration with QuamCore includes a multi-million-dollar contract focused on co-developing Single Flux Quantum (SFQ) devices. SkyWater Technology, Inc.'s market capitalization was approximately $709 million and annual revenue was $290 million as of the November 2025 announcement with QuamCore.

Technology partners for Design & IP, Packaging, and Testing

SkyWater Technology, Inc. partners with companies across Design & IP, Packaging & Testing, and Process Development. For advanced packaging, SkyWater signed a technology transfer and license agreement with Deca Technologies for its Gen 2 M-Series Fan-out and Adaptive Patterning Technology. Initial tool deliveries for the fan-out wafer-level packaging platform in Florida commenced in 2024, in preparation for an expected 2025 ramp in Advanced Packaging revenues. The company expects both quantum and advanced packaging to be 2 key areas of ATS growth moving into 2026.

Weebit NVM for ReRAM technology licensing

SkyWater Technology, Inc. licenses Weebit NVM's Resistive RAM (ReRAM) technology for customer designs. SkyWater Technology, Inc. initially offers this as embedded Non-Volatile Memory (NVM) IP on its 130nm CMOS process. Weebit Nano generated A$4.4 million in revenues in its fiscal year 2025 from initial commercialization, which includes license fees from partners like SkyWater Technology, Inc. The technology licensing agreement with SkyWater Technology, Inc. has a minimum term of six years with 12-month renewals after the seventh year.

Here's a quick view of some of the key financial and operational metrics tied to these partnerships as of late 2025:

The total borrowing capacity from the new debt facility used to fund the Fab 25 acquisition is up to $350 million. For Q3 2025, the organic SkyWater business (Legacy SkyWater) expected Q3 ATS revenue of approximately $50 million.

SkyWater Technology, Inc. (SKYT) - Canvas Business Model: Key Activities

You're looking at the core engine of SkyWater Technology, Inc. as of late 2025, which is heavily defined by integrating a massive capacity expansion while maintaining its niche as a trusted domestic supplier. The Key Activities here are centered on manufacturing scale, specialized development, and securing high-assurance government work.

Executing Advanced Technology Services (ATS) development programs

The Advanced Technology Services (ATS) segment remains vital for co-development and securing future high-volume business. For the third quarter of 2025, Legacy SkyWater ATS development revenue was reported at $54.2 million. This contrasts with the second quarter of 2025, where ATS development revenue was $52.6 million, which represented a 4% decrease compared to the second quarter of 2024. The company is banking on emerging areas, specifically expecting to exceed 30% revenue growth in quantum computing related revenues in 2025. The ATS focus involves joint R&D between SkyWater process integration teams and customers, acting as the initial phase before programs transition to Wafer Services.

High-volume manufacturing of 200mm foundational wafers

High-volume manufacturing is now significantly bolstered by the newly acquired assets. The core activity involves running 200mm foundational wafers, a capability dramatically scaled by the Fab 25 integration. The Legacy SkyWater Wafer Services (WS) revenue for the third quarter of 2025 was $6.2 million. This followed the second quarter of 2025, where WS revenue was $5.4 million, marking a 7% decrease year-over-year for that quarter. The acquired Fab 25 facility itself is a 200 mm semiconductor fab and is central to this activity.

Integrating the newly acquired Fab 25 operations in Texas

This is arguably the most significant activity in 2025. SkyWater Technology completed the acquisition of Infineon's Fab 25 on June 30, 2025, for a total consideration including working capital adjustments of approximately $93 million. This integration immediately added capacity of approximately 400,000 wafer starts per year. The SkyWater Texas segment, which includes Fab 25, contributed $86.6 million to the total consolidated revenue of $150.7 million in the third quarter of 2025. Management projected Fab 25 would contribute at least $300 million in annual revenue starting in the third quarter of 2025. The SkyWater Texas segment generated $17.3 million in gross profit in Q3 2025, achieving a margin of 19.9%. Furthermore, the GAAP net income for Q3 2025 included a preliminary $110.8 million bargain purchase gain directly related to this acquisition. Approximately 1,000 Fab 25 employees joined SkyWater as part of the transaction. The facility supports foundational nodes down to the 65 nm node.

Developing advanced packaging platforms in Florida

The Florida operation is dedicated to heterogeneous integration and advanced packaging, a critical area for national security. This facility is developing fan-out wafer level packaging (FOWLP) capabilities, which can support both 200mm and 300mm device wafer formats. This development is supported by a significant five-year DOD contract valued up to $190 million. Progress in Florida was noted in Q1 2025 in preparation for an expected revenue ramp in the second half of 2025.

Securing and maintaining DMEA-accredited Trusted Foundry status

Maintaining the highest level of security clearance is a non-negotiable key activity, especially for defense and critical infrastructure customers. SkyWater Technology is a DMEA-accredited Category 1A Trusted Supplier across its entire operational footprint. The Minnesota facility originally achieved this status in 2010. Crucially, the advanced packaging operation in Florida achieved its Category 1A Trusted Supplier accreditation on May 14, 2024, meaning 100% of SkyWater's operations are Trusted as of late 2025. This status is essential for supporting strategic rad-hard and defense programs.

Here's a snapshot of the operational scale and financial impact from the Q3 2025 results, which reflect the new structure:

The core operational focus areas, which drive the Technology as a Service (TaaS) model, can be summarized by the technology categories they enable:

• Executing development for Mixed-Signal CMOS.
• Fabricating Rad-Hard ICs for extreme environments.
• Supporting MEMS and Superconducting ICs.
• Providing Heterogeneous Integration solutions.
• Developing Photonics capabilities.

Financially, the company is leveraging significant debt capacity, with an amended credit facility increasing borrowing capacity to $350 million to support these capital-intensive activities.

SkyWater Technology, Inc. (SKYT) - Canvas Business Model: Key Resources

SkyWater Technology, Inc. possesses critical physical and intellectual assets underpinning its Technology as a Service model. The company operates three state-of-the-art U.S. fabrication facilities located in Minnesota, Florida, and Texas, with the recently acquired Fab 25 in Austin, Texas, adding approximately 400,000 wafer starts per year in capacity.

A core resource is the DMEA-accredited Category 1A Trusted Foundry status, which guarantees assured access for Department of Defense programs. SkyWater has achieved that this status covers 100% of its operations.

The company has secured significant external funding to support its expansion and tool investment, evidenced by a new five-year, senior secured revolving credit facility of up to $350 million, which is earmarked to fund upfront acquisition costs and ongoing capital expenditures. This aligns with the customer-funded CapEx model where customers provide upfront capital to fund development.

Proprietary process IP includes expertise in heterogeneous integration and specialized materials critical for advanced applications. SkyWater is integrating Infineon's high-voltage and copper interconnect intellectual property into its S130 platform. The company specializes in foundational nodes and has proprietary process IP for technologies including rad-hard ICs and superconducting ICs.

The focus on emerging technology is resource-intensive, particularly in quantum computing, which SkyWater identified as its second-largest end market.

• Expected to exceed 30% revenue growth in Advanced Technology Services (ATS) revenues from quantum customers in fiscal 2025.
• Added four new customers in the quantum segment this year (as of November 2025).
• Preparing to launch a superconducting design platform in the second half of 2025.
• Expanding capabilities in superconducting films, interposers, and chip integration.

SkyWater Technology, Inc. (SKYT) - Canvas Business Model: Value Propositions

You're looking at how SkyWater Technology, Inc. delivers unique value in the semiconductor space, which is really about de-risking technology development and securing domestic supply. The core is a service-oriented approach that moves customers from an idea to mass production.

Technology as a Service (TaaS) model: co-development to volume production

The Technology as a Service (TaaS) model is designed to streamline the path to production for customers, offering development services, high-volume production, and heterogeneous integration solutions all within their U.S. facilities. This pioneering model lets innovators co-create the next wave of technology. New products, which are a direct output of this co-development, contributed to over half of Wafer Services revenue in the first quarter of 2025, a significant jump from a 90% legacy mix in 2024. For the third quarter of 2025, the Advanced Technology Services (ATS) development revenue component of Legacy SkyWater revenue was $54.2 million. This ATS development revenue saw a 4% decrease compared to the third quarter of 2024, partly due to U.S. Government budget delays. Still, the fastest-growing area is quantum.

• The TaaS model covers development services, high-volume production, and heterogeneous integration.
• Four new commercial Quantum customers were signed since the second quarter of 2025, including SQC and QuamCore.
• SkyWater Technology expects to exceed 30% revenue growth in Quantum-related ATS revenues for fiscal 2025.

Secure, exclusively U.S.-based semiconductor manufacturing

A key differentiator is the commitment to being exclusively U.S.-based, which directly supports national onshoring and supply chain resilience mandates. SkyWater Technology is a DMEA-accredited Category 1A Trusted Foundry, a critical designation for defense and government programs. The acquisition of Fab 25 converted captive capacity into open-access infrastructure, expanding domestic foundry services for industrial, automotive, and defense customers. With this addition, SkyWater Technology became the largest exclusively U.S.-based, pure-play foundry service provider offering dual-sourced support for foundational node, 200 mm foundry capacity.

Specialization in high-value, emerging markets (e.g., quantum, rad-hard)

SkyWater Technology focuses on high-value, emerging markets where custom solutions are essential. These critical domestic markets include aerospace & defense, automotive, biomedical, industrial, and quantum computing. Quantum computing is identified as the second-largest end market and is the company's fastest-growing category. The company is actively expanding capabilities in superconducting films, interposers, and chip integration to support this segment.

Rapid prototyping and process iteration for new technologies

The TaaS structure is built to enable innovators to develop and iterate quickly, moving from early prototyping to production scale readiness. This is evident in the diverse categories supported, which include mixed-signal CMOS, read-out ICs, rad-hard ICs, MEMS, superconducting ICs, photonics, and advanced packaging. The Florida advanced packaging platform development is progressing, with tool installations scheduled for completion in early 2026, readying operations for customer prototype builds later that year.

Expanded 200mm foundry capacity post-Fab 25 acquisition

The acquisition of Infineon Technologies AG's 200 mm semiconductor fab in Austin, Texas, known as Fab 25, was completed on June 30, 2025. This transaction was a strategic repositioning, costing $73 million at close plus approximately $20 million for working capital. The integration of Fab 25 significantly increased SkyWater Technology's domestic 200-millimeter foundry capacity by approximately 400,000 wafer starts per year, effectively quadrupling that capacity segment. The facility focuses on foundational chips on nodes from 130 down to 65 nanometers. The financial impact was immediate, with SkyWater Texas contributing $86.6 million in wafer services revenue in the third quarter of 2025 alone. The total consolidated revenue for the third quarter of 2025 reached $151 million, a 60.7% rise year-on-year, with Fab 25 projected to contribute at least $300 million in annual revenue.

Here's a quick look at the capacity and revenue scale added by the Fab 25 integration as of late 2025:

The total Q3 2025 revenue of $151 million represented a 60.6% surge year-on-year. Legacy SkyWater revenue for Q3 2025 was $64.1 million, which includes $54.2 million in ATS development revenue. The company expects this segment to generate strong adjusted EBITDA and positive free cash flow starting in the third quarter.

SkyWater Technology, Inc. (SKYT) - Canvas Business Model: Customer Relationships

You're looking at how SkyWater Technology, Inc. locks in its high-value, specialized fabrication work. The relationships are built on deep technical integration, not just transactional sales.

Deep, collaborative, and long-term co-development (TaaS)

The Technology as a Service (TaaS) model is central here, enabling innovators to co-create next-wave technologies. This deep collaboration is evident in the quantum computing segment, which is the fastest-growing area for SkyWater Technology, Inc. You saw strong momentum here, with SkyWater Technology, Inc. expecting to exceed 30% revenue growth in quantum computing related revenues for fiscal 2025. This growth is fueled by new design wins; SkyWater Technology, Inc. signed four new Advanced Technology Services (ATS) engagements with quantum computing companies since the second quarter of 2025, bringing the total commercial quantum customers to seven.

The structure of these engagements means customers are embedded in SkyWater Technology, Inc.'s U.S. facilities for development, production, and integration.

Dedicated program management for government and large commercial clients

For critical domestic markets like aerospace & defense, dedicated program management is necessary to navigate complex requirements, such as those tied to Trusted Foundry status. While aerospace and defense ATS revenue saw a $9.3 million decrease in the second quarter of 2025 compared to the second quarter of 2024, SkyWater Technology, Inc. noted an acceleration of program timing within these markets in the third quarter of 2025. This suggests that while budget timing can cause near-term fluctuations, the underlying programs require sustained, dedicated engineering oversight to keep them on track for future revenue recognition.

High customer stickiness due to specialized, integrated processes

The stickiness comes from the specialized nature of the process technology itself, which is hard to replicate elsewhere, especially given the focus on foundational nodes and advanced packaging. When a customer commits to a process flow, switching costs are high. However, you can see where segment demand can be sensitive; in the second quarter of 2025, Wafer Services (WS) revenue saw a $0.4 million decrease, mainly due to a decline in demand from a key automotive customer. This shows that even with specialized processes, reliance on a single large customer in a specific segment can introduce near-term volatility.

Direct sales and engineering support for complex projects

Complex projects, especially those involving emerging technologies, require direct engagement between SkyWater Technology, Inc.'s engineers and the customer's design teams. This is the essence of the ATS revenue stream, which was $54.2 million in the third quarter of 2025. The company's facilities in Minnesota, Florida, and Texas support this model across diverse categories like superconducting ICs and advanced packaging. The U.S. remains the core market, generating $53.8 million in revenue in the second quarter of 2025.

Investor relations and analyst engagement (e.g., NYC Summit)

Managing the relationship with the investment community is key to funding these long-term, capital-intensive relationships. SkyWater Technology, Inc. actively engaged with this group, participating in the 14th Annual NYC Summit investor conference on Tuesday, December 16, 2025. This event featured a "round-robin" format with small group meetings for accredited investors and publishing research analysts, allowing management to directly communicate the value proposition underpinning these customer relationships. The presentation materials for this event were made available on the company's investor relations website at ir.skywatertechnology.com.

Here's a quick look at the customer-facing financial metrics from recent reporting periods:

The success of the TaaS model is directly tied to securing these deep, multi-year engagements, which is why the quantum pipeline is so important to watch.

SkyWater Technology, Inc. (SKYT) - Canvas Business Model: Channels

You're looking at how SkyWater Technology, Inc. gets its specialized semiconductor manufacturing and services to market as of late 2025. The channels are a mix of direct engagement with high-value sectors and leveraging strategic alliances to scale capacity and technology reach.

Direct sales force targeting aerospace, defense, and quantum

SkyWater Technology, Inc. focuses its direct sales efforts on segments where its DMEA-accredited Category 1A Trusted Foundry status provides a competitive moat. The sales motion is heavily geared toward securing long-term, mission-critical production contracts. The company identified quantum computing as its second-largest end market as of late 2025. This direct targeting is showing results, with revenues from quantum computing customers projected for 30% growth in the ATS (Advanced Technology Services) revenues for the fiscal year.

The primary customer segments driving this direct channel engagement include:

• Aerospace & Defense programs, leveraging its trusted supplier status.
• Quantum computing, with four new ATS engagements signed since the second quarter of 2025.
• Automotive, benefiting from the expanded capabilities at Fab 25.
• Industrial and Biomedical sectors.

Three U.S.-based manufacturing and development facilities

The physical channel for delivering products is anchored by its exclusively U.S.-based manufacturing footprint. The major expansion in 2025 significantly altered this channel's capacity profile. The company completed the acquisition of Infineon Technologies' Fab 25 in Austin, Texas, on June 30, 2025, for $93 million, which added approximately 400,000 wafer starts annually to its throughput. This move brought the total employee count to approximately 1,700, with about 1,000 new employees joining from the Texas site.

Here's a breakdown of the key physical channels:

The Texas operations alone contributed $86.6 million in Wafer Services revenue in the third quarter of 2025.

Investor Relations website for financial and strategic communication

The Investor Relations website at ir.skywatertechnology.com serves as the primary channel for formal financial disclosure and strategic narrative dissemination to the investment community. For instance, the record third quarter 2025 results were communicated through this channel. The Q3 2025 report showed total consolidated revenue reached $150.7 million, a 60.7% increase year-over-year. GAAP gross profit for the quarter was $36.2 million, representing 24.0% of total revenue.

The communication via this channel highlights key financial milestones:

• Q3 2025 Total Revenue: $150.7 million.
• Year-over-Year Revenue Growth (Q3 2025): 60.7%.
• Legacy SkyWater Revenue (Q3 2025): $64.1 million.
• Expected Annual Revenue Contribution from Fab 25: At least $300 million.

Industry conferences and technology showcases

SkyWater Technology, Inc. actively uses industry events to showcase its capabilities directly to accredited investors and analysts. The company announced participation in the 14th Annual NYC Summit, scheduled for December 16, 2025. This event format involves small group meetings with management teams. Attendance at this specific summit is available solely to accredited investors and publishing research analysts, indicating a highly targeted channel for investor engagement.

Strategic technology partner networks

The company leverages deep, technology-specific partnerships to co-develop and validate its advanced manufacturing processes, effectively using partners as an extension of its R&D and market access channel. These collaborations are critical for emerging technology adoption, such as quantum computing.

Key strategic alliances as of late 2025 include:

The license agreement with Infineon Technologies, announced July 29, grants access to a robust library of silicon-proven mixed-signal design IP, which enhances SkyWater's offerings for automotive-grade applications.

SkyWater Technology, Inc. (SKYT) - Canvas Business Model: Customer Segments

You're looking at the core groups SkyWater Technology, Inc. builds its foundry services around as of late 2025. This is where the revenue engine is focused, spanning government mandates to emerging tech like quantum.

U.S. government and Department of Defense (DOD) programs

SkyWater Technology, Inc. serves as the largest exclusively U.S.-based, pure-play semiconductor foundry, which directly feeds into the secure domestic supply chain for government and defense needs. The company is a DMEA-accredited Category 1A Trusted Supplier. The Advanced Technology Services (ATS) segment is heavily tied to these customers, though funding timing creates variability. For instance, in the third quarter of 2025, Legacy SkyWater ATS development revenue was $54.2 million, a 4% decrease compared to the third quarter of 2024, partly due to delayed U.S. Government budget approvals impacting program execution timing. SkyWater Technology, Inc.'s role is critical for mission-critical national security initiatives.

Commercial companies in quantum computing

Quantum computing is identified as the second largest end market. The company expects quantum computing related revenues to exceed 30% revenue growth in fiscal 2025. Momentum is strong, with four new ATS engagements signed with quantum computing companies since the second quarter of 2025. Specific partners include SQC and QuamCore. The third quarter of 2025 marked the strongest ever quarter for quantum computing-related revenue.

Innovators in aerospace, defense, and biomedical sectors

These sectors drive significant ATS development revenue. In the second quarter of 2025, the aerospace and defense industry saw an ATS revenue decrease of $9.1 million year-over-year, largely due to U.S. government policy changes. However, an acceleration of program timing within aerospace and defense end markets led to stronger ATS development revenues in the third quarter of 2025 compared to the forecast. Furthermore, two leading defense prime customers drove robust demand for the new ThermaView platform in the first quarter of 2025.

Automotive and industrial controls manufacturers (post-Fab 25 focus)

The acquisition of Fab 25 in Texas is strategically positioned to meet quality standards, including those for automotive applications. Demand from this sector has shown fluctuation; in the second quarter of 2025, Wafer Services revenue decreased by $0.4 million, mainly due to a decline from a key automotive customer. The industrial segment also experienced weakness, as seen by a 54% decline in Wafer Services revenue in the third quarter of 2024 due to weakness in that end market.

Customers requiring secure, domestic semiconductor supply

The entire business model is underpinned by this requirement. The acquisition of Fab 25 firmly establishes SkyWater Technology, Inc. as the largest exclusively US-based pure play foundry service provider. This capacity expansion increases the 200 millimeter foundry business capacity by 4x in the US. The company's focus on mature nodes (90-180 nanometer) for radiation-hardened logic and power devices serves this critical need.

Here's a quick look at the key segments and associated data points from the latest reporting period:

The Technology as a Service (TaaS) model helps funnel development work into volume production. For example, roughly one-third of ATS programs are modeled to carry over to volume production within 5 years.

• DMEA-accredited status for Trusted Supplier requirements.
• Focus on mature nodes: 90-180 nanometer range.
• Two named quantum customers: SQC and QuamCore.
• Legacy SkyWater Wafer Services revenue in Q3 2025 was $6.2 million.
• Legacy SkyWater Tools revenue in Q3 2025 was $3.7 million.

Finance: draft 13-week cash view by Friday.

SkyWater Technology, Inc. (SKYT) - Canvas Business Model: Cost Structure

You're looking at the cost side of SkyWater Technology, Inc. (SKYT) as they integrate the massive Fab 25 acquisition. The cost structure is dominated by the capital intensity of semiconductor manufacturing, which means high fixed costs are the name of the game.

High fixed costs from operating three large fabrication facilities

Operating three large fabrication facilities-Minnesota, Florida, and the newly acquired Texas Fab 25-locks in substantial fixed costs. These costs are spread across the manufacturing base, but the depreciation alone from the new Texas asset is significant. For instance, management estimated the annual depreciation charge for Fab 25 to be between $\text{\$30 million}$ and $\text{\$45 million}$ over six to eight years, reflecting the scale of the fixed asset base you're now supporting. SkyWater Technology, Inc. is now the largest exclusively U.S.-based, pure-play semiconductor foundry, which inherently carries a high fixed-cost burden to maintain that scale and Trusted status.

Cost of Revenue (CoR) for Wafer Services and ATS execution

Cost of Revenue (CoR) directly ties to the utilization and material costs within the Wafer Services and Advanced Technology Services (ATS) segments. The margin profile varies significantly between these two. For context on the activity driving CoR, consider the Legacy SkyWater Q3 2025 revenue breakdown:

The ATS portion, which includes co-development work, has a different CoR profile than the high-volume follow-on Wafer Services. Management guided Q1 2025 non-GAAP gross margin for the combined ATS and Wafer Services business in the mid-20s, specifically between $\text{23\%}$ and $\text{27\%}$.

Operating expenses (Q4 2025 outlook: $\text{\$28.5M}$ to $\text{\$29.5M}$ GAAP)

Operating expenses (OpEx) are a key area of focus, especially with the scale-up from the Fab 25 integration. For the fourth quarter of 2025, the guidance for GAAP operating expenses is set in the range of $\text{\$28.5 million}$ to $\text{\$29.5 million}$. This is a step-up from prior periods; for example, Q3 2025 GAAP operating expenses were reported at $\text{\$23.5 million}$, which included higher ongoing overhead costs related to roughly doubling the business scale post-Fab 25 acquisition. The Q4 2025 outlook includes costs associated with the new scale.

Significant debt servicing costs from the Fab 25 acquisition financing

Financing the Fab 25 acquisition introduced significant interest expense. The transaction was funded through a new senior secured revolving credit facility of up to $\text{\$350 million}$, which replaced the existing $\text{\$130 million}$ facility. Following the Q2 2025 closing, total debt outstanding stood at $\text{\$137 million}$. This new debt load directly translates into higher interest costs that hit the income statement below gross profit. For Q1 2025, the company had guided interest expense in the range of $\text{\$2.0 million}$ to $\text{\$2.5 million}$, which you can expect to be recalibrated higher following the full draw on the new facility.

R&D and engineering talent acquisition and retention

A major component of the operating expense structure is the investment in specialized talent to drive the Advanced Technology Services (ATS) business, particularly in emerging areas like quantum computing and advanced packaging. This spending is critical for customer acquisition and retention in the TaaS (Technology-as-a-Service) model. You see this reflected in the OpEx figures, as these specialized engineering teams are essential to securing and executing on multi-year development programs. For instance, SkyWater Technology, Inc. signed four new quantum computing customer engagements since Q2 2025, all requiring dedicated engineering resources.

Here's a look at the OpEx context:

• Q4 2025 GAAP Operating Expenses outlook: $\text{\$28.5M}$ to $\text{\$29.5M}$.
• Q3 2025 GAAP Operating Expenses actual: $\text{\$23.5 million}$.
• Q4 2024 GAAP Operating Expenses actual: $\text{\$16.6 million}$.
• New debt facility capacity: Up to $\text{\$350 million}$.
• Estimated annual depreciation from Fab 25: $\text{\$30 million}$ to $\text{\$45 million}$.

Finance: draft 13-week cash view by Friday.

SkyWater Technology, Inc. (SKYT) - Canvas Business Model: Revenue Streams

SkyWater Technology, Inc.'s revenue streams flow from its dual role as a pure-play foundry and a technology development partner, segmented across manufacturing, advanced services, and equipment sales.

The core manufacturing revenue is captured under Wafer Services (WS). For the third quarter of 2025, the total Wafer Services revenue reached $92.8 million. This figure is a combination of revenue from the Legacy SkyWater operations and the newer SkyWater Texas facility (Fab 25), which contributed approximately $86.6 million of wafer services revenue in the quarter. The Legacy SkyWater Wafer Services revenue for Q3 2025 was $6.2 million, showing a 7% decrease compared to the third quarter of 2024.

Advanced Technology Services (ATS) development revenue is a significant component, representing revenue primarily from process development services, tool installation, facility access, and security services. In Q3 2025, this segment generated $54.2 million. This was stronger than forecast due to the timing of program execution, including an acceleration of program timing within aerospace and defense end markets. The Legacy SkyWater ATS development revenue was $54.2 million in the quarter, a 4% decrease year-over-year.

Tools revenue, derived from the procurement and subsequent sale of equipment to customers who retain ownership but use the equipment within SkyWater fabs for ATS programs, contributed $3.7 million in Q3 2025. This figure reflects the Legacy SkyWater Tools revenue, which saw a substantial 88% decrease compared to the third quarter of 2024.

The consolidated revenue for SkyWater Technology, Inc. in Q3 2025 was a record $150.7 million, composed of these primary streams.

Government contracts and grants provide a foundational layer of support for technology development, securing trusted domestic foundry supply for critical platforms aligned with national security and aerospace and defense initiatives. The company previously won $16 million in proposed direct funding under the CHIPS and Science Act, complemented by about $19 million from the State of Minnesota's Forward Fund to support modernization and capacity expansion.

A key growth driver within the ATS segment is the quantum computing market. SkyWater Technology, Inc. is on track to exceed 30% revenue growth in quantum computing related ATS revenues for fiscal 2025, having signed four new quantum customers since the second quarter of 2025.

• Quantum-related ATS revenue is the fastest-growing category.
• The company has active commercial Quantum customers spanning multiple modalities.
• Government ATS business is largely driven by strategic multiyear development programs.