Industry Context and Strategic Directions
The deceleration of Moore’s Law presses the semiconductor industry to innovate in other ways, such as through 3D architecture, novel materials, chiplets, and hybrid packaging. According to industry forecasts, AI-related applications will account for 70% of semiconductor revenue by 2030. To produce these advanced AI chips efficiently and at scale, massive volumes of data need to be collected, aligned, and analyzed across a complex ecosystem of design, manufacturing, assembly and test companies. Analyzing the data is not enough, real-time action on the tools and in the factories is required to achieve the desired outcomes of yield, performance, quality and costs. All of this means secure data and operations collaboration across the semiconductor industry – a critical enabler for AI adoption.
Data has immense strategic value for semiconductor companies. Fab operators rely on equipment-level data for predictive maintenance. Test facilities require traceable test data to improve yields. Fabless chip designers depend on performance data from foundries to refine their designs. Without visibility and a mechanism to securely share data between stakeholders, inefficiencies emerge. Accurate real-time data is the bridge between design, manufacturing, and operations. Secure data collaboration facilitates this connection while ensuring privacy, intellectual property (IP) protection, and operational control.
PDF Solutions is at the forefront of secure data and operations collaboration. With nearly three decades of experience and customers spanning the entire semiconductor landscape, PDF Solutions provides the leading commercial platform that each participant of the semiconductor industry uses to create actionable insights based on its own data and the securely shared data and transactions of its supply chain partners.
A global platform, local execution
Investment in semiconductor manufacturing is expanding globally, creating a more distributed industry landscape while simultaneously facing increased international trade restrictions. In this complex environment, semiconductor companies need an experienced partner who can support their design innovation and manufacturing excellence wherever they operate. For decades, PDF Solutions has collaborated with customers across Asia, Europe, and North America, helping them accelerate product development and enhance manufacturing efficiency. Today, PDF Solutions operates on a global platform serving the broader industry while maintaining local operations that comply with regional regulations on intellectual property protection, business practices, and export controls.
2024 PDF Solutions Performance
PDF Solutions achieved record performance in 2024, with revenue growth accelerating significantly in the second half of the year. Our annual revenue reached $179.5 million, representing an 8% increase over 2023’s $165.8 million. This growth intensified throughout the year, with Q3 and Q4 showing impressive year-over-year increases of 13% and 22% respectively. Analytics revenue, which now constitutes 94% of our total revenue, grew by 11% on an annual basis to $169.3 million.
Summary of Financial Accomplishments
- Record full-year total revenues of $179.5 million, up 8% over last year
- Record full-year analytics revenue of $169.3 million, up 11% over last year
- GAAP gross margin of 70% and non-GAAP gross margin of 74%
- GAAP diluted EPS of $0.10 and non-GAAP diluted EPS of $0.84
- Backlog of $221.4 million as of December 31, 2024
Our significant growth acceleration in the latter half of 2024 stems from leading-edge semiconductor companies adopting our eProbe and Exensio analytics solutions to enhance process control and yield improvement investments.
eProbe Technology Adoption
In 2024, we witnessed a pivotal transition as customers moved from evaluating eProbe to fully deploying this technology. This shift not only positively impacted our financial results but also validated the critical role eProbe plays in developing and scaling production of the most advanced semiconductor devices. At the SPIE conference in early 2025, presentations demonstrated the superiority of eProbe’s design-layout-based Point Vector Scan technology, including its successful application in high-volume manufacturing. We anticipate continued adoption of our eProbe solutions across advanced logic, Gate All Around technology, backside power applications, and expanding use cases in advanced DRAM.
Exensio Analytics Growth
Our Exensio analytics platform also delivered strong revenue growth in 2024, particularly in Manufacturing Analytics, Test Operations, and Process Control applications.
Sapience Manufacturing Hub Deployment
We initiated deployment of our Sapience Manufacturing Hub solution at a leading foundry company, accelerating their digital transformation by integrating manufacturing applications and data with enterprise systems. We expect similar deployments at other large semiconductor manufacturers seeking to modernize their application architecture.
AI Leadership Initiatives
In 2024, we hosted our inaugural AI Executive Conference focused on AI applications in semiconductor manufacturing. This event brought together 140 attendees from over 75 organizations, including presentations from key customers and partners. A consistent theme emerged: AI offers tremendous potential to help the semiconductor industry achieve the efficiency gains necessary to support the massive growth opportunity that AI itself represents. However, this globally distributed industry requires a new type of platform—one specifically engineered to manage the unique characteristics and vast volumes of semiconductor design and manufacturing data while enabling secure collaboration with robust IP protection.
Strategic Acquisition and Future Direction
Our recent acquisition of secureWISE represents a strategic investment to provide the semiconductor industry with this new AI-driven industry platform. As the most widely adopted secure remote connectivity solution in semiconductor manufacturing equipment, secureWISE enables equipment makers to leverage our Exensio analytics software and derive greater value from equipment data.
This acquisition significantly expands the capabilities of our secure DEX OSAT network, facilitating collaboration among equipment makers, fab operators, and fabless companies to optimize chip manufacturing and testing processes while harnessing AI’s potential. Already the leading analytics platform for semiconductor manufacturing, PDF Solutions now enables ecosystem members to collaborate through secure, direct connections and control manufacturing processes down to the production equipment level.
Despite geopolitical and economic uncertainties, we see tremendous opportunities for our customers and the industry to leverage our team’s expertise and innovation. Together, we can realize the transformative benefits that AI offers to both the semiconductor industry and the world at large.