Everspin Technologies Inc. (NASDAQ: MRAM) experienced a substantial surge in its stock price on Thursday, climbing approximately 38% to $18.17 after reaching an intraday high of $19.63. The sharp increase followed the announcement of a significant $40 million subcontract agreement to provide Toggle MRAM process technology and engineering services to clients within the U.S. Defense Industrial Base.
Contract Details and Strategic Importance
The agreement, signed on April 24, 2026, with Amentum Services Inc., positions Everspin as a subcontractor on a U.S. government project focused on microelectronics research, development, testing, and evaluation at the Naval Surface Warfare Center, Crane Division. The contract spans two phases from April 20, 2026, to November 21, 2028, with milestone-based payments. This deal is particularly noteworthy given that Everspin's total revenue for 2025 was $55.2 million, making the $40 million contract a substantial addition to its pipeline.
Financial Performance and Outlook
The defense contract comes on the heels of a stronger first quarter. Everspin reported first-quarter revenue of $14.9 million, up from $13.1 million a year earlier, driven by MRAM product sales that rose to $14.1 million from $11.0 million. Gross margin improved to 52.7%, and the GAAP net loss narrowed to $0.3 million, or 1 cent per share. For the second quarter, the company expects revenue between $15.5 million and $16.5 million, with a projected GAAP loss per share of 7 to 12 cents. Importantly, this outlook excludes any contribution from the new defense subcontract.
Manufacturing Expansion and Competition
This contract adds momentum to Everspin's strategic push to expand U.S. manufacturing. On April 8, 2026, the company announced a 10-year agreement with Microchip Technology to establish an MRAM production line at Microchip's Oregon fabrication facility. Everspin will retain full control of its intellectual property and process technology, with initial shipments expected in the second half of 2027. The MRAM market remains highly competitive, with Everspin facing rivals such as Microchip, Micron, and Samsung in the Toggle MRAM segment, while STT-MRAM competes against DRAM and other memory products from larger players with deeper financial resources.
Risks and Execution Challenges
Despite the positive news, investors remain cautious about execution risks. The subcontract is contingent upon meeting specific milestones, and Amentum can terminate the agreement only if the prime contract with NSWC Crane is canceled. This structure introduces uncertainty regarding the timing and predictability of revenue recognition. Chief Financial Officer Bill Cooper acknowledged the potential for a "significant impact on the financials" and noted the contract could be "beneficial to margin," but the company has yet to provide detailed guidance on how the revenue will flow in.
Market Context and Implications
Everspin's stock surge reflects renewed investor confidence in the company's growth trajectory, particularly as it leverages its MRAM technology for defense applications. MRAM, a nonvolatile memory that retains data without power while offering high speed and durability, is increasingly sought after in aerospace, industrial, and data center environments where data integrity is critical. The defense contract underscores the strategic value of on-shore MRAM capabilities and positions Everspin to capitalize on growing demand for secure, reliable memory solutions in mission-critical systems.
