Vicor

Vicor just posted revenue of 143.4 million dollars for the second quarter, up 27% from the prior quarter, and net income of 49.8 million dollars, more than double the 20.7 million it earned three months earlier. The bigger story is the order book. Backlog hit 380 million dollars, up 26% in a single quarter and up 145% from a year ago, powered by high performance computing, automatic test equipment, and industrial, aerospace and defense customers.

Royalty revenue nearly tripled from a year ago to 30.4 million dollars in a single quarter, and that money carries almost no cost to produce. It is a big reason gross margin climbed to 58% from 55.2% last quarter. Cash also piled up fast, with the balance rising to 453.6 million dollars and no debt to speak of, giving Vicor room to fund a second factory for its next generation chips.

Management says the first factory is filling up as demand rises, and a second one is only in the early planning stage. Capital spending ran 11.2 million dollars this quarter, and building a new fab will push that far higher for years. If orders keep growing faster than Vicor can build parts, that 380 million dollar backlog turns into waiting customers instead of sales.

This quarter's profit got a large lift from an 10.9 million dollar tax benefit rather than pure operations, and last year's comparison included a one time 45 million dollar patent settlement. That makes results jump around a lot. The stock is also volatile, with a beta of 2.34, meaning it tends to swing more than twice as hard as the overall market in both directions.