IQE and X-FAB Partner to Develop GaN Power Platform
Why we think this is good
The joint development agreement between IQE and X-FAB to create a European-based GaN Power device platform solution is a positive step for IQE. The partnership leverages the companies' respective expertise in GaN epitaxy and device fabrication, which should help mitigate execution risk. Additionally, the target markets of automotive, data center, and consumer applications represent significant growth opportunities for IQE. However, the lack of financial details and a clear timeline for commercialization tempers the overall sentiment.
Key Points
- IQE and X-FAB sign Joint Development Agreement for GaN Power
- Developing a market-ready GaN Power Platform with a scalable outsourced manufacturing model
- Collaboration leverages IQE's GaN epitaxy expertise and X-FAB's device fabrication capabilities
- Provides fabless semiconductor companies with a leading-edge, off-the-shelf GaN Power platform
- Targets automotive, data center and consumer applications
Summary
IQE plc (AIM: IQE), the leading global supplier of compound semiconductor wafer products and advanced material solutions, and X-FAB Silicon Foundries SE, the leading analog/mixed-signal and specialty foundry, have signed a Joint Development Agreement (JDA) to create a European-based GaN Power device platform solution.
The initial two-year scope of work will see the companies collaborate to develop a 650V GaN device, leveraging IQE's GaN epitaxy design and process expertise along with X-FAB's device fabrication capabilities. This will provide fabless semiconductor companies with a leading-edge, off-the-shelf GaN platform, accelerating their innovation cycles and time-to-market.
The broker targets for IQE indicate a Buy recommendation with a price target of 20.00p from Deutsche Bank and a Buy recommendation with a price target of 55.00p from Numis.