Navitas Stock Soared 114% But Is the Rally Already Over?

Navitas’ stock is down big after earnings.

The numbers look bad: falling revenue, bigger losses, and weak guidance.

But behind the scenes, Navitas has partnerships with Nvidia, Dell, and Lenovo… and a play on AI data centres that could change the game.

The stakes are massive: if they execute, this could be one of the biggest semiconductor turnarounds of the decade.

And today, I’ll break it all down: the stock price, the financials, the catalysts, and the risks so you know exactly where Navitas stands right now.

Company Overview

Navitas is a pure power semiconductor company founded in 2014 by Gene Sheridan, the current CEO, Stephen Oliver, and Dan Kinzer. The company makes Gallium Nitride (GaN) and Silicon Carbide (SiC)-based technology for electric vehicles, mobile phones, solar panels, and data centres. 

And here’s the thing: semiconductors are the backbone of every megatrend right now, and Navitas is betting on being the “picks and shovels” supplier for that growth.

In 2016, Navitas debuted its first Gallium Nitride-based power integrated circuit (IC), one of the world’s first ICs to fully integrate key functions and components into a single, monolithic chip. 

The value in Gallium Nitride-based power ICs is that they have faster switching speeds and lower on-resistance, which results in higher efficiency and lower temperatures. They also take up less space, since they’re in one piece. 

One of the most well-known  GaN-based power ICs from Navitas is their GaNFast power IC, which is said to allow for 3x faster charging in half the size and weight of traditional silicon-based chips, with up to 40% better energy efficiency. These power ICs are used in mobile chargers, laptop chargers, data centre power supplies, solar inverters, and EVs. 

Navitas’s clients include Dell, Lenovo, NVIDIA, and Xiaomi – that’s proof they’ve already earned the trust of Big Tech.

Stock Price

Now that’s out of the way, let’s get into the juicy parts, starting with the company’s stock price.

The last time I reviewed Navitas was around July 18, when the stock was trading at around $6.20. This was a few days before the price spiked to nearly $9. 

However, things are different now. 

After that brief price spike, share prices fell again, most notably after August 4, when the company released its Q2 financials. We’ll talk more about that later. Navitas closed at $8.05 on August 4, then closed at $6.35 the very next day – that is an over 20% drop in 24 hours. 

That kind of swing tells you one thing: investors are nervous. 

Still, the stock is trading higher than it was a year ago. It’s up 114% over the last 52 weeks, while year-to-date returns are still pretty high at 80%. 

So, Navitas was on a pretty solid upward trajectory before the financials were released.  

That raises the question: what exactly happened there? 

Financials

According to their Q2 FY’25 financial report, Navitas reported a 29% year-on-year drop in revenue from $20.5 million to $14.5 million. 

Net losses also more than doubled – from 12 cents per share to 25 cents per share year on year. That’s not exactly encouraging news for shareholders. 

Meanwhile, third-quarter guidance puts revenue at around $10 million.

For reference, Q3 2024’s revenue came in around $21.6 million, so if Q3 guidance comes true, that’ll be a 54% drop year over year. And when revenue is collapsing this fast, you have to ask what management is not telling us?

So, yeah, I’d say that inventors had a few good reasons to sell the stock once the Q2 numbers were released. 

Growth Catalysts

However, it’s not all doom and gloom for the company. Although Navitas has been earning less this year compared to last year, several factors could drive its growth in the coming years. 

Nvidia Partnership

So far, the company’s most significant catalyst for growth is its partnership with Nvidia. In May 2025, Navitas announced that it teamed up with Nvidia to power its next-gen 800V HVDC AI centres. 

The 800-V high-voltage direct current (HVDC) data centres will utilise an improved architecture that reduces copper requirements, enhances efficiency, increases reliability, decreases cooling requirements, and lowers maintenance costs by 70%. 

That’s not just an upgrade, that’s a reinvention of how data centres run.

If it delivers on its promise, Navitas could be positioned for a big turnaround. 

Environmental Angle

The company’s GaN chips also don’t just mean lower costs for clients – they also reduce the environmental impact of data centres, which we’ve recently discussed in my Discord channel. 

Data centres’ electricity demand is expected to grow 300% over the next decade. 

The US Department of Energy estimates roughly the same growth but at a faster rate – at double or triple the usage by 2028. 

Data centres also consume a lot of water, with larger ones estimated to use up to 5 million gallons a day. 

With Navitas’ technology, data centres and other mass-scale computational facilities can achieve higher power efficiency, which in turn reduces their electricity and water consumption, plus reduces their overall carbon footprint. 

For most companies today, that’s a double benefit. They receive reduced costs, more funds for improvements, and enhanced ESG scores, which can be key factors in attracting investors. 

When you can save money and boost ESG scores, you’re not just selling chips, you’re reputation of sale, and that’s priceless in today’s market.

Risks

Of course, not everything is smooth sailing for Navitas. There are some risks involved. Here’s where most investors get blindsided by the downside.

Revenue Slump

The most enormous red flag about the company is its declining revenue. Here’s a quick look at the company’s sales in the last five quarters. 

Meanwhile, losses are also increasing, which is never a good sign. 

And while Navitas has accounted for their pivot to AI power infrastructure and the potential China tariffs, their expectations for Q3 are still very conservative. 

The outlook suggests management is tempering expectations despite the AI narrative, which has been more than enough to boost some companies in the market right now. Declining revenue plus weak guidance is a double hit, and that’s precisely when Wall Street punishes hardest.

As it stands, I need to see clearer signs of revenue stabilisation, or at least a clear path to that goal, before I remove this risk from my analysis. 

Tax Credits / Move Away From Green Energy

Navitas is also taking a hit from the removal of the tax credits for the solar and EV industry,

How do EV and green energy issues impact Navitas? Sure, the company is not a solar or EV company – but many of its clients are. 

In fact, Navitas powers many solar and EV products with their GaN ICs. There’s a company that develops power electronics for electric vehicles, produces on-board chargers and DC-DC converters using Navitas’ GaN power ICs.   

With the removal of tax credits, demands from EV and solar manufacturers may slump, and consumers may be less willing to buy solar and EV products. And when demands vanish, Navitas could be caught in a downdraft. 

Chinese Tariffs

And then, there’s the risk that’s been popping up in many of my analyses: the tariffs. 

The ongoing trade tensions with China are a significant risk for Navitas. China is one of the biggest markets for electronics, which includes mobile fast chargers. Tariffs on Chinese electronics may affect the prices of products built with Navitas chips, potentially softening overall demand. 

Furthermore, Navitas has exposure to the Chinese EV market through its partnership with car manufacturer Changan. The Chinese automaker uses Navitas’ GaNSafe technology for its recently announced on-board chargers. 

If tariffs escalate or restrictions tighten, Navitas could face a triple whammy: weaker demand for consumer electronics, slower adoption in electric vehicles, and supply chain issues. 

I’ve been in the market long enough to know that one bad headline can erase months of stock gains; that’s how fragile sentiment is here.

Valuation / Verdict

But what do the numbers say about Navitas’ current price?

As of the time of recording, Navitas is trading at a 15.89 price-to-sales ratio – the highest among its closest competitors. It’s almost triple the next highest p/s ratio from Power Integrations – and that company is already profitable. 

This is relatively high, even given its exposure to AI. This means that, at its current level, investors are pricing in significant future growth with very little room for missteps. 

Meanwhile, analysts have been steadily decreasing their ratings on Navitas, with the latest round of scores averaging 3.44, which is at the lower edge of a Moderate Buy rating. And when Wall Street analysts start lowering the bar, it usually means pain for retail investors who bought the hype.

Previously, I also rated Navitas a ‘soft buy’, leaning more towards a ‘hold’. With the Q2 financials as they stand, I’m downgrading my rating to a full hold. 

Don’t get me wrong. Navitas’s tech is very cool and has a lot of potential to save customers money.  However, macroeconomic factors and worsening top-line performance are creating too much risk and uncertainty for me to give it a buy rating. 

For more cautious investors, it would be advisable to wait until Navitas releases its next-generation technology before investing.  

But what’s your take on Navitas? Are you holding, buying, or letting go of your shares?