Guerrilla RF, a provider of state-of-the-art radio frequency and microwave communications semiconductors, has provided a corporate update for guidance on full-year 2023 and 2024 revenue, financing, and efforts to accelerate its path to profitability.
Management believes Q3 2023 revenue will be between $3.3 and $3.5 million, i.e., on the upper end of the previously communicated range of its guidance of $3.0 to $3.5 million. Total revenue for 2023 is expected to exceed $15.0 million (with a range of $14.6 to $15.4 million), representing an approximate increase of 30% over the previous year.
The Company anticipates revenue for the full year 2024 to be between $21.0 and $26.0 million (representing an increase of 40%), as previously announced design wins continue to ramp. Those design wins are expected to generate in excess of $7.0 million in annualized ongoing program revenue for 2024 and increase through 2028. Additionally, Management believes the gross profit margin will grow to be in excess of 60.0% for the full year as fixed costs are absorbed more efficiently.
During the third quarter of 2023, Guerrilla RF announced a further advance of $1.5 million under its existing credit facility and an initial advance of $1.75 million under a new $4.0 million loan facility with Salem Investment Partners, LP. This new facility allows the Company to capture additional revenue upside, which has resulted in backlog increasing to $6.11 million as of September 15, 2023, up from the $5.48 million (an increase of 21.8%) backlog reported as of June 30, 2023, and $4.5 million (an increase of 35.8%) as of December 31, 2022, positioning the Company for the largest revenue quarter in its history.
In conjunction with securing additional funding to support its growth, Management has continued to focus on reducing expenses that do not directly support increased near-term sales and/or gross margins. The Company has implemented cost savings measures, including voluntary salary reductions, further reducing salary expenses through attrition, elimination of non-essential expenses, and other efforts. These efforts are expected to reduce annualized expenses between $3.0 and $5.0 million within the next several quarters. The Company expects to substantially achieve breakeven on an operating basis, excluding interest expense, other non-operating expenses and non-recurring expenses, beginning the second quarter of 2024 as revenues are expected to exceed $6.0 million per quarter and fixed costs are absorbed more efficiently.
“Since 2013, Guerrilla RF has been investing in products and delivering high-performance RF solutions to demanding markets that value performance. However, as the market environment has changed, it has become clear that profitability is more important than all-out growth. We have shifted our strategy accordingly to achieve breakeven status beginning with the second quarter of 2024. In light of anticipated 2024 revenue and operational profitability, Management believes the Company is significantly undervalued at approximately one times anticipated 2024 revenue,” said Ryan Pratt, Founder & CEO.
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