Spectra7 Announces 50% Y-o-Y Revenue Growth in First Quarter 2023, Affirms Outlook for Q2 2023.

SAN JOSE, Calif: (TSXV:SEV) (OTCQB:SPVNF) Spectra7 Microsystems Inc. ("Spectra7" or the "Company"), a leading provider of high-performance analog semiconductor products for broadband connectivity markets, today announced its financial results for the three months ended March 31, 2023 and re-affirmed its outlook for Q2 2023. A copy of the consolidated financial statements for the three months ended March 31, 2023 and the corresponding management's discussion and analysis (the "MD&A") will be available under the Company's profile on www.sedar.com. Unless otherwise indicated, all dollar amounts in this press release are expressed in US dollars.

"We are off to a strong start in the first quarter, increasing revenue by 50% year over year, following exceptional growth in 2022. Our gross margin for the quarter increased to 63%. In addition, we continue to advance key relationships across all our end markets, including AR/VR and hyperscale data centers. The hyperscale data center partners and customers are readying 800G and 1.6TB products for expected deployment in the second half of this year, a critical part of the next data center upgrade cycle," 1 said Raouf Halim, Chief Executive Officer.

"Test and qualification activities are increasingly focused on new switches that require 800G and 1.6TB data rate interconnects. These tests continue to demonstrate that Active Copper Cables enabled by Spectra7 are the most power and cost-efficient solutions to meet the requirements for top-of-the-rack and short-run connectivity, an estimated $1 billion market by 2026.2 We expect this process to generate orders from key data center customers in North America in the second half of 2023."1

"Based on these activities and indications that supply availability will improve steadily throughout 2023 and support a return to higher margins, we have established a goal of EBITDA3 profitability by the end of the year,"1 said Mr. Halim.

First quarter 2023 financial highlights

First quarter 2023 revenue of $3.1 million, up approximately 50% year-over-year.

Gross margin4 as a percentage of revenue in the first quarter increased to 63%, from 43% in the same quarter in the prior year.

Non-IFRS operating expenses5 were $2.2 million in the first quarter, down from $2.5 million in the same quarter in the prior year as the Company continues to control its spending.

Basic and diluted loss per share for the first quarter was $(0.03), compared with a basic and diluted loss per share...