SVCO Stock Forecast & Price Target

Silvaco Group Inc demonstrated robust growth in its maintenance and service revenue, reporting a 22.7% year-over-year increase to $4.8 million, which indicates strong ongoing customer engagement and satisfaction. Despite software license revenue experiencing a year-over-year decline of 34.5% to $7.2 million, it still constituted 60% of total revenue, highlighting the significant dependence on this income stream. Additionally, the company's reported remaining performance obligations (RPOs) reached $36.4 million, reflecting a 9.7% year-over-year increase, suggesting a solid pipeline for future revenue generation.

Silvaco Group reported a significant decline in total bookings, totaling $12.9 million, reflecting a 34% year-over-year decrease, primarily influenced by the absence of a large FTCO deal from the previous year. In addition, the company's Q2 revenue was reported at $12 million, which is down 19% year-over-year and 20% lower than both analyst estimates and FactSet Consensus projections. Given these disappointing financial metrics and the ongoing weakness in bookings, there has been a downward revision of estimates, resulting in a lowered target price based on an analysis of blended average EV/S multiples and discounted cash flow.