Monolithic Power Systems (MPWR) Q1 2025: Storage & Computing Jumps 38%, Powering Broad-Based Growth
MPWR delivered an uncharacteristically strong Q1 in storage and computing, up 38% sequentially, with broad-based strength across memory and notebook solutions. The company’s diversified end-market strategy and global supply chain investments are delivering resilience and share gains, while management maintains a cautious approach to margin and demand visibility for the second half. Design wins and product ramps in enterprise data, automotive, and new silicon-based solutions set up a content-driven growth story into 2026.
Summary
- Storage & Computing Outperformance: Sequential surge in storage and computing signals share gains and content expansion.
- Enterprise Data Ramps Ahead: Design wins and platform qualifications set up a second-half acceleration.
- Transformation to Solutions Provider: MPWR’s push into silicon-based systems aims to expand margin and addressable market.
Performance Analysis
MPWR posted record quarterly revenue, up 39% year-over-year, led by a standout 38% sequential increase in storage and computing segment revenue. This growth came from strong demand in both memory and notebook solutions, with management citing broad-based design win activity across major enterprise data customers. The storage and computing segment’s outperformance stands out against typical Q1 seasonality, suggesting meaningful share gains and content per system expansion.
Automotive revenue delivered its third consecutive quarter of double-digit sequential growth, up 13% from Q4, driven by early ramps in 48-volt and 800-volt EV architectures and power isolation modules. Enterprise data finished in line with expectations but is positioned for a second-half ramp as design wins and qualifications convert to revenue. Management reported lean inventory both internally and in channel, with a flexible supply chain supporting short lead times and rapid demand shifts.
- Segment Divergence: Storage and computing led growth, while other segments saw stable, narrow sequential variance.
- Automotive Content Story: Design wins in next-gen EV platforms drive momentum, with most upside weighted to 2026 and beyond.
- Inventory Discipline: Internal and channel inventories remain below model, supporting supply agility and risk mitigation.
Gross margin guidance for Q2 is slightly conservative, reflecting product mix and management’s preference to operate within established corporate average ranges. Tariff and pricing impacts remain muted, with diversified manufacturing and R&D footprints insulating MPWR from supply shocks and cost volatility.
Executive Commentary
"We continue to win designs across all major enterprise data customers with revenue ramps expected in the second half of this year. Finally, Q1 25 automotive revenue increased 13% from Q4 24, the third consecutive quarter of sequential double-digit growth. MPS continues to focus on innovation, solving our customers' most challenging problems and maintaining the highest level of quality."
Bernie Blagan, EVP and CFO
"We want to have a silicon-based solution company. I want to monetize our know-how. Instead of selling $1, $2 parts, now you start to sell $1,000, $10,000 stuff. Our customers, sometimes, they relate to our customers. We're talking to a different level of people. We want to have cooperating with the large companies. We have those solutions. And you can sell, you can buy the entire solution. You can have it as like a white box. You label it. Or another way is you borrow modules rather than a chip. It just take much of an effort from their hand."
Michael Singh, CEO and Founder
Strategic Positioning
1. Diversification Across End Markets
MPWR’s commitment to a diversified market strategy is evident in its balanced growth across storage, computing, automotive, and enterprise data. The company’s approach reduces exposure to cyclical swings in any single vertical and enables it to capitalize on secular trends like AI, EV, and data center power requirements. This diversification is supported by a global supply chain, with local manufacturing for local demand, and R&D centers spread across the US, China, and Europe.
2. Transition to Silicon-Based Solutions
MPWR is actively transforming from a chip-only semiconductor supplier to a full-service silicon-based solutions provider. By integrating modules, software, and system-level design, the company aims to capture higher dollar content per customer, improve margin profile, and deepen customer relationships. Initial traction is seen in building automation, medical (sonogram modules), and audio, with management highlighting strong engagement from large enterprise customers seeking turnkey solutions.
3. Content Expansion in Automotive and Data Center
Design wins in next-generation EV and high-power data center platforms are driving a content-per-unit tailwind. The company is shipping early-stage 48-volt and 800-volt products, with broader adoption expected in 2026 and 2027. In data centers, MPWR is delivering 120-kilowatt modules for rack power, targeting material revenue contribution starting next year as the market transitions to megawatt-scale racks and AI compute intensifies.
4. Supply Chain Resilience and Tariff Insulation
Years of proactive supply chain diversification have insulated MPWR from tariff shocks and geopolitical risk. The company now operates with manufacturing capacity both inside and outside China, enabling flexible allocation of supply and reducing risk from US-China trade tensions. This agility supports short customer lead times and positions MPWR competitively against less diversified peers.
5. Margin Discipline and Product Mix Management
Management remains disciplined on margin, prioritizing high-performance, high-margin product ramps over volume at the expense of profitability. New products are launched at higher margin, and the company avoids competing on price alone. Gross margin is expected to stay within historical model ranges, with upside potential if product mix shifts toward higher-value solutions in 2026 and beyond.
Key Considerations
MPWR’s Q1 2025 results reinforce its positioning as a diversified, innovation-driven supplier with increasing content per system and a resilient operational model. Investors should weigh the following:
Key Considerations:
- Share Gains in Storage & Compute: Sustained momentum in DDR5, SSD, and notebook power management signals content expansion and share capture.
- Second-Half Ramps in Enterprise Data: Multiple platform qualifications and design wins set up a back-half revenue acceleration, though timing remains customer-dependent.
- Automotive Upside Tied to Content, Not Units: Growth is driven by new platform content (48V, 800V, power isolation), with most material impact expected in 2026–2027.
- Supply Chain Flexibility: Global manufacturing footprint and inventory discipline support rapid response to demand volatility and mitigate risk from tariffs or regional disruptions.
- Transformation to Solutions Model: Initial customer engagement for silicon-based systems could expand addressable market and margin, but revenue contribution remains nascent.
Risks
MPWR’s visibility into customer ramps, especially in enterprise data and automotive, remains limited and subject to customer scheduling and platform shifts. Macroeconomic uncertainty, competitive pricing pressure, and the risk of overbuilding inventory as new products ramp all pose challenges. While tariff and supply chain risks are currently muted, any major geopolitical escalation or sudden shift in customer demand could disrupt the company’s stable outlook.
Forward Outlook
For Q2 2025, MPWR guided to:
- Stable sequential performance across all segments, with variance within plus or minus five percentage points.
- Gross margin guidance 20 basis points lower at the midpoint, reflecting conservative product mix assumptions.
For full-year 2025, management maintained a wide range for enterprise data growth, reflecting ongoing uncertainty in timing of customer ramps:
- Second-half weighted revenue acceleration in enterprise data and automotive as design wins convert to production.
Management highlighted several factors that will influence results:
- Customer qualification and ramp timing in enterprise data and automotive remain outside MPWR’s direct control.
- New product launches and content expansion in high-power data center and EV platforms are expected to drive 2026 growth.
Takeaways
MPWR’s Q1 results showcase the benefits of a diversified, content-driven model and a proactive approach to supply chain risk.
- Storage and computing outperformance reflects both share gains and secular growth in memory and notebook power management.
- Enterprise data and automotive are positioned for a second-half ramp, with design wins and platform qualifications supporting future revenue visibility.
- MPWR’s transformation into a silicon-based solutions provider could unlock new margin and revenue streams, but investors should monitor execution and customer adoption over the next 12–18 months.
Conclusion
MPWR delivered a quarter of broad-based strength, with standout performance in storage and computing and a robust pipeline of design wins in enterprise data and automotive. The company’s strategy of diversification, content expansion, and operational flexibility positions it well for continued growth, though the timing of key ramps remains the primary variable for investors to watch.
Industry Read-Through
MPWR’s results reinforce the importance of end-market diversification and supply chain agility in the semiconductor sector. The company’s ability to deliver strong sequential growth in storage and computing, despite typical Q1 seasonality, signals ongoing secular demand for memory and compute power management. EV content expansion and data center power transitions are structural tailwinds not just for MPWR, but for analog and mixed-signal peers. The muted impact of tariffs and smooth channel inventory suggest that companies with global manufacturing and R&D footprints will be better positioned to weather future volatility. Investors in the analog, power management, and content-per-system value chain should monitor design win momentum and supply chain flexibility as key differentiators in the coming cycle.