Here are 1-3 brief analogies to describe SkyWater Technology (SKYT):

• TSMC for specialized, U.S.-made chips and advanced packaging.
• Foxconn for custom, high-tech U.S.-made microchips.

• Semiconductor Foundry Services: Fabrication of integrated circuits (chips) for customers using specialized process technologies, including advanced silicon, photonics, and superconducting processes.
• Technology Development Services: Collaborative research and development with clients to create new process flows, custom device designs, and intellectual property.
• Advanced Packaging Services: Physical assembly and encapsulation of semiconductor chips into their final functional packages, supporting various integration needs.

Major Customers of SkyWater Technology (SKYT)

SkyWater Technology (SKYT) primarily operates on a business-to-business (B2B) model, providing advanced semiconductor manufacturing services to a diverse range of clients.

Due to the highly competitive and confidential nature of the semiconductor foundry industry, SkyWater Technology typically does not publicly disclose the specific names of its major commercial customers. While their SEC filings often indicate a significant portion of revenue derived from a limited number of customers (e.g., 49% from the top five in 2023), these customers are not individually named.

However, SkyWater Technology serves various categories of organizations, which constitute its customer base:

• Fabless Semiconductor Companies: These companies design integrated circuits but outsource their fabrication to foundries like SkyWater. They represent a broad range of clients, from startups to established players focusing on various applications (e.g., artificial intelligence, Internet of Things, automotive, medical).
• Integrated Device Manufacturers (IDMs): While IDMs have their own manufacturing capabilities, they may utilize external foundries for specialized processes, overflow capacity, or specific technology nodes that complement their in-house capabilities.
• Government Agencies and Prime Contractors: A significant portion of SkyWater's business involves contracts with the U.S. government, particularly the Department of Defense (DoD) and related agencies (like DARPA), for trusted microelectronics programs. SkyWater is a DMEA-accredited Category 1A Trusted Foundry, indicating its critical role in national security supply chains. While the U.S. government itself is not a public company, it represents a major client. In some instances, SkyWater may work with prime contractors (public companies like Lockheed Martin, symbol: LMT; Northrop Grumman, symbol: NOC) who then fulfill government contracts, though direct major customer relationships with these prime contractors are not consistently detailed publicly by SkyWater.
• Research Institutions and Universities: SkyWater collaborates with and provides manufacturing services to academic and research organizations for advanced technology development, prototyping, and educational initiatives.

Given the general non-disclosure of specific commercial customer names due to industry confidentiality, it is not possible to list them with their public symbols as major direct customers based on publicly available information. The U.S. Government is a major client, but not a public company.

• Nippon Sanso Holdings Corporation (TYO: 4091)
• Shin-Etsu Chemical Co., Ltd. (TYO: 4063)
• SOITEC S.A. (EPA: SOI)

Thomas Sonderman, Chief Executive Officer & Director

Thomas Sonderman was appointed CEO and elected to SkyWater Technology's board of directors in 2017. Under his leadership, he spearheaded the company's transformation from an integrated device manufacturer (IDM) to a pure-play foundry and led its successful initial public offering (IPO) in 2021. Prior to joining SkyWater, his extensive industry experience included various leadership positions at Rudolph Technologies (now ONTO Innovation), GLOBALFOUNDRIES, and AMD. Notably, he played a critical role as part of an executive team at AMD that spun off its manufacturing operations to form GLOBALFOUNDRIES. Mr. Sonderman is also the author of 50 patents.

Steve Manko, Chief Financial Officer

Steve Manko joined SkyWater as Chief Financial Officer in July 2020. He utilizes his extensive finance background to drive profitability and enhance the organization's value. Prior to SkyWater, Mr. Manko was a managing director at Riveron Consulting, where he led the Financial Advisory Services practice in Minneapolis. In this role, he and his team assisted companies through various change events, including acquisitions and internal process changes and optimizations. Earlier in his career, he worked at Ernst & Young, specializing in the Banking & Capital Markets industries.

John Sakamoto, President & Chief Operating Officer

John Sakamoto joined SkyWater in September 2023 and is responsible for overseeing all day-to-day business and manufacturing operations. He brings 25 years of experience in various executive leadership positions with high-technology industry leaders such as Altera, Intel, and Marvell. His expertise encompasses market strategy, organizational growth, general management, business unit leadership, sales, operations, engineering, and acquisition integration planning.

Brad Ferguson, Chief Government Affairs Officer, SkyWater Florida & SVP and General Manager

Dr. Brad Ferguson focuses on accelerating the growth of SkyWater's Advanced Packaging and Special Programs, and strengthening strategic U.S. government relationships. Previously, he served as Chief Technology Officer, where he created the company's technology roadmap and IP strategy, and launched its government relations strategy. Dr. Ferguson began his career in photolithography process development at Cypress Semiconductor. In 2008, he founded and developed the Cypress custom foundry business, successfully achieving Trusted Foundry status accreditation and securing numerous defense customers, which marked the site's entry into the aerospace and defense market.

Chris Hilberg, General Counsel & Chief Risk and Compliance Officer

Chris Hilberg is responsible for SkyWater's legal and compliance functions, providing strategic business, corporate, governance, transactional, and compliance advice and leadership to the company's management and board of directors. He oversees the legal and compliance team and manages all legal affairs, including corporate governance, commercial transactions, intellectual property, corporate and regulatory compliance, employment law, and litigation. He holds an undergraduate degree in physics from Carleton College and a law degree from the University of Chicago Law School. He is also a licensed patent attorney.

The key risks to SkyWater Technology (SKYT) primarily revolve around its significant reliance on government funding and specific market segments, intense competition coupled with the need for continuous technological adaptation, and substantial operational and financial challenges.

1. High Dependence on US Government Funding and Specific Sectors: SkyWater Technology has considerable revenue exposure to the U.S. government, with approximately 30% linked to this source. This reliance, while beneficial in a favorable environment, poses a significant risk as any reduction in CHIPS Act funding or Department of Defense (DoD) programs could lead to growth impediments for its Advanced Technology Services (ATS) and Wafer Services revenue. The company's strategic alignment with U.S. semiconductor reshoring and national security initiatives, while an advantage, concentrates its market risk within these government-backed defense and industrial sectors.
2. Intense Competition and Rapid Technological Change: Operating in the highly competitive semiconductor industry, SkyWater Technology faces challenges from established major players like TSMC and Intel. The industry is characterized by rapid technological advancements, making continuous innovation critical. Failure to keep pace with evolving technologies or to commercialize new solutions effectively could result in a loss of market share. While SkyWater focuses on mature nodes and niche markets, the broader industry trend towards cutting-edge technologies remains a competitive pressure. Additionally, the company's sole-source fabs lack secondary backups for most critical process tools, making it vulnerable to significant downtime from unforeseen equipment failure. Supply chain vulnerabilities, including dependence on a limited number of third-party suppliers for key components and capital equipment, also pose a risk to production timelines and costs.
3. Operational and Financial Challenges from Capital Intensity and Acquisitions: The semiconductor manufacturing industry is inherently capital-intensive, requiring substantial investments in equipment and technology. SkyWater Technology has faced profitability challenges, with fluctuating earnings and negative free cash flow in the past, contributing to stock price volatility. Recent strategic expansions, such as the acquisition of Fab 25, introduce integration complexities, including managing a four-fold increase in capacity and a significant influx of new employees. This acquisition is also expected to result in near-term gross margin compression and has added to the company's debt burden. The need to continuously raise additional capital or financing to support and expand its business remains a persistent financial risk.

The aggressive expansion of larger, well-funded domestic foundry services, particularly Intel Foundry Services (IFS), into specialized and trusted fabrication markets. Intel's explicit strategic focus on becoming a leading advanced and trusted foundry in the U.S., backed by substantial government incentives and deep resources, represents a significant shift in the competitive landscape. This intensifies competition for government contracts, process development agreements, and specialized manufacturing services, potentially drawing away customers or strategic partnerships critical to SkyWater's business model focused on "Technology as a Service" and niche high-value fabrication.

SkyWater Technology (SKYT) participates in several addressable markets for its main products and services:

• The addressable market for thermal imaging is estimated to be $9 billion, spanning defense, industrial, and medical applications.
• The global automotive semiconductor market is projected to reach $67.75 billion by 2027.
• The IoT semiconductor market is expected to grow to $35.5 billion by 2026.
• SkyWater Technology is a key player in the quantum computing sector, with quantum revenue projected to grow over 30% for 2025. In 2022, SkyWater generated $12.8 million from quantum computing chips. The company's goal is to be the "quantum foundry".
• SkyWater also serves the defense and space technologies market, generating $26 million in revenue from this sector in 2022. The company is a trusted producer for the U.S. government and military. The U.S. CHIPS Act has allocated $52.7 billion for semiconductor research and manufacturing.

SkyWater Technology (SKYT) is expected to experience significant revenue growth over the next 2-3 years, driven by several key initiatives and market trends:

1. Acquisition and Integration of FAB25 (SkyWater Texas): The acquisition of the FAB25 foundry in Austin, Texas, is a major driver, projected to double SkyWater's business scale and significantly enhance its market position. This acquisition includes a multiyear supply agreement with Infineon, anticipated to exceed $1 billion.
2. Growth in Quantum Computing: SkyWater Technology has shown strong momentum in its quantum computing sector, which is identified as its fastest-growing category and a key contributor to longer-term financial targets. The company expects to exceed 30% revenue growth in quantum-related Advanced Technology Services (ATS) for fiscal year 2025, with similar growth levels anticipated in 2026 due to new customer onboarding and program expansion.
3. Expansion of Advanced Packaging and New Product Launches: The expansion of SkyWater's advanced packaging platform and the launch of new products, such as the ThermaView platform targeting the advanced thermal imaging market, are expected to drive future revenue. New products contributed to over half of Wafer Services revenue in Q1 2025, a substantial increase from a 90% legacy mix in 2024.
4. Reshoring of Semiconductor Manufacturing and Government Initiatives: As an exclusively U.S.-based pure-play semiconductor foundry, SkyWater is well-positioned to benefit from government incentives and the broader trend of reshoring semiconductor manufacturing to the United States. This focus on domestic production, particularly for defense systems, further enhances its market opportunities.
5. New Customer Engagements: SkyWater has been actively securing new customer engagements, particularly within the quantum computing sector, including partnerships with companies like Silicon Quantum Computing (SQC) and QuamCore. These new customer relationships are expected to fuel continued growth and innovation.

Share Issuance

• SkyWater Technology completed its Initial Public Offering (IPO) in 2021, generating $112 million in proceeds.
• In October 2025, the company filed for a mixed shelf offering of up to $350 million.
• Proceeds from the issuance of common stock through equity compensation plans amounted to $725,000 in Q2 2025 and $3.627 million in Q3 2025.

Inbound Investments

• SkyWater Technology received a proposed direct funding of up to $16 million from the CHIPS for America program (U.S. Department of Commerce) to enhance production capabilities at its Minnesota facility.
• The State of Minnesota's Forward Fund pledged $19 million to support the expansion of SkyWater's semiconductor manufacturing facility in Bloomington.
• These state and federal incentives, combined with existing and planned customer-funded capital expenditure co-investments, are expected to bring total outside investment levels to over $350 million through the decade.

Outbound Investments

• SkyWater completed the acquisition of Infineon's Fab 25 in Austin, Texas, for approximately $93 million in June 2025.
• This acquisition was funded by a new credit facility.
• The transaction terms for Fab 25 were modified to increase the upfront payment by $18 million and eliminate a $25 million payment at the conclusion of a multi-year supply agreement.

Capital Expenditures

• SkyWater expects over $350 million in capital expenditure funding and co-investment between 2020 and 2026.
• Customer-funded capital expenditures included $76 million in tool funding through contract awards in 2024.
• Additional customer-funded capital expenditures of more than $90 million are anticipated through year-end 2026, bringing the total expected funding from 2020 to 2026 to approximately $320 million. These expenditures primarily focus on modernizing and upgrading facilities, increasing 200 mm semiconductor technology development and production capacity by 30%, and expanding advanced packaging capabilities.