Ideal Power Inc (NASDAQ:IPWR, FRA:5ILA) is seeing growing momentum around its B-TRAN semiconductor technology as demand rises for solid-state circuit protection across AI data centers, energy infrastructure, and automotive applications. With its sales funnel now exceeding $400 million, the company is advancing prototypes while positioning itself for the shift toward high-voltage DC infrastructure.
In this interview, Ideal Power CEO David Somo discusses the company’s progress with its Asian and automotive customers, the opportunity presented by Nvidia’s 800V architecture, its co-development work on an intelligent solid-state circuit breaker (SSCB) prototype for a planned evaluation by a hyperscaler, and the company’s strengthened balance sheet.
Proactive: Take us through some of the highlights of the quarter for you. What really stood out to you, and what are you most proud of?
David Somo: What stood out most was the continued progress toward our strategic priorities and the commercialization of our B-TRAN product.
We have advanced our opportunity with our lead Asian customer for a low-current SSCB. In the next couple of weeks, we will ship the first prototypes for their internal testing and evaluation. This customer is expected to have prototypes that they can begin promoting to their end customers in the fourth quarter.
We also continue to make progress with Stellantis and our sales funnel has grown from just over $300 million to more than $400 million across AI data center, industrial and automotive applications.
Overall, we see continued momentum across our customer base. I am particularly excited about working with an industry partner on an SSCB prototype that can be offered to hyperscalers for evaluation in AI data center environments.
We have also added a new advisory board member who comes from a company with a deep footprint in data centers and optical communications. He understands the environment well and can help us shape our strategy to introduce our products into that market.
You moved from initial discussions with a foundry to a long-term supply agreement and functional B-TRAN first silicon in roughly two quarters. What made this foundry the right long-term partner?
It is a high-volume, automotive-qualified foundry that has produced more than a billion power semiconductors. It can provide the high-volume support we will need as we scale, while also giving us a cost-competitive partner that we believe can support our operating model and target gross margins as the business grows.
How significant could the opportunity around Nvidia’s Rubin Ultra 800V DC architecture become for Ideal Power, and what needs to happen for B-TRAN to move from prototype development into commercial volume orders?
The general consensus is that the technology transition will begin in the second half of next year and see rapid adoption. As rack power levels and compute capabilities increase to meet data center demand, we want to be positioned to support that transition through our customer programs.
Our goal is to assist in getting our customers’ products to market and into the hands of data center operators and energy infrastructure suppliers so they can conduct field testing and evaluation and complete that process in line with the expected timeline.
That is what we are working toward now. There are a wide range of projections regarding how large the opportunity could become. It is being driven by major industry players, and we are happy to benefit from those tailwinds. We are seeing strong and growing demand for solid-state circuit protection as part of the high-voltage DC infrastructure being developed.
You expect B-TRAN-enabled prototypes from your lead Asian customer to be available for 800V AI data center and grid applications in the fourth quarter. What are the key milestones you will be watching during customer testing?
We will continue working closely with the customer on prototype evaluation and testing. They have two levels of testing: functional testing and their internal certifications, which they complete as products are prepared for market release.
We will support them throughout that process. It is generally at the systems level, which is their area of expertise, but when it comes to our products within that system environment, we want to be there to support them and help accelerate the effort.
You are working with an industry partner on an intelligent solid-state circuit breaker prototype for a planned evaluation by a US hyperscaler. How does this project fit into your broader strategy with hyperscalers?
It is really about getting SSCB technology directly into the hands of hyperscalers as they develop power distribution systems for high-voltage DC operation.
There are no established standards in this area today, so there is a real opportunity for innovation in solid-state circuit protection, and we want to be at the forefront of that. By working with a partner at the systems level to develop differentiated, value-added products for hyperscalers, we can help them understand how the technology could be deployed in their environments.
At the same time, it can create pull-through demand for our direct customers, which will ultimately build the circuit protection devices used in these applications. It allows us to get our technology in front of our customers’ customers, helping us seed the technology in the market and demonstrate the value proposition of B-TRAN at the systems level.
That sounds like a big opportunity, especially for Ideal Power over the longer term.
Yes, and that is why it is important. It is similar to the model that exists today on the automotive side, where you have a triangle involving the OEM, the Tier One supplier and the semiconductor supplier.
We see opportunities for that same model with hyperscalers, our direct customers and ourselves. We want to pursue that path and see how we can help influence the direction of the technology.
With Stellantis receiving a second shipment of B-TRAN samples and working with Ideal Power to optimize a solid-state contactor solution, what remains before the technology could be adopted in an EV platform?
There are multiple steps in the development process, including deliverables and milestones that our customer will work through, and we are there to support them throughout that process.
Some steps are predicated on our products, while others relate to different aspects of the overall system solution. All of those elements need to work together to deliver a solution that meets their requirements.
It is a process that plays out over many months because it takes time for customers to develop, qualify and bring automotive products to market. That is why this represents a medium- to longer-term revenue opportunity for us.
If we can successfully navigate this process, it puts us in a strong position to win a program down the road, and we will continue working closely with them toward that goal.
You strengthened the balance sheet with $27.7 million in net proceeds from an offering during the quarter and ended June with $41.3 million in cash. How do you plan to deploy that capital as you move toward commercialization and potentially high-volume production?
The funding provides the operating cash we need to continue investing in the business and execute on our roadmap.
Knowing that we have a significant cash runway to execute our commercialization activities increases customers and suppliers’ confidence that they can engage with us and develop new products with us for the long-term.
So, it is a boost both because it gives us the funding to execute on our strategic priorities and commercialization activities, and because it gives confidence to our customers, suppliers and investors that we will be around to execute on those plans.
Finally, do you think people are waking up to the fact that your technology can be used across so many different areas and applications? Are you seeing more interest as a result?
I think there are two things happening. One is the broader market catalyst of the transition from AC-operated power environments to high-voltage DC across data centers and the energy infrastructure that supports them. That is driving greater interest in solid-state solutions across the board.
Then, as people look at the solid-state options available to them, we continue to see strong interest in B-TRAN as a solution that provides system-level advantages. That interest is expanding, which is one reason we continue to see growth in our sales funnel.
Customers recognize the market transition that is occurring and are looking for solutions that can support it. They see some unique capabilities in B-TRAN that fit well with this market. As a result, we are seeing increasing momentum for the technology.