10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2022

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________________________

Commission File Number 0-18277

VICOR CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	04-2742817
(State of Incorporation)	(I.R.S. Employer Identification No.)

25 Frontage Road, Andover, Massachusetts 01810

(Address of Principal Executive Office)

(978) 470-2900

(Registrant’s telephone number)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	VICR	The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☑    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☑    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☑	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☑

The number of shares outstanding of each of the issuer’s classes of Common Stock as of July 25, 2022 was:

Common Stock, $.01 par value	32,225,594
Class B Common Stock, $.01 par value	11,758,218

VICOR CORPORATION

INDEX

	Page
Part I — Financial Information:
Item 1—Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets at June 30, 2022 and December 31, 2021		1
Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2022 and 2021		2
Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2022 and 2021		3
Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2022 and 2021		4
Condensed Consolidated Statements of Equity for the three and six months ended June 30, 2022 and 2021		5
Notes to Condensed Consolidated Financial Statements		7
Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations		19
Item 3—Quantitative and Qualitative Disclosures About Market Risk		31
Item 4—Controls and Procedures		31
Part II — Other Information:
Item 1—Legal Proceedings		33
Item 1A—Risk Factors		33
Item 6—Exhibits		33
Signature(s)		34
EX-31.1 SECTION 302 CERTIFICATION OF CEO
EX-31.2 SECTION 302 CERTIFICATION OF CFO
EX-32.1 SECTION 906 CERTIFICATION OF CEO
EX-32.2 SECTION 906 CERTIFICATION OF CFO

VICOR CORPORATION

Part I – Financial Information

Item 1 – Financial Statements

Condensed Consolidated Balance Sheets

(In thousands, except share data)

(Unaudited)

	June 30, 2022			December 31, 2021
Assets
Current assets:
Cash and cash equivalents	$	187,677		$	182,418
Short-term investments		19,921			45,215
Accounts receivable, net		54,536			55,097
Inventories		83,055			67,322
Other current assets		7,142			6,708
Total current assets		352,331			356,760
Long-term deferred tax assets, net		266			208
Long-term investment, net		2,552			2,639
Property, plant and equipment, net		156,815			115,975
Other assets		1,392			1,623
Total assets	$	513,356		$	477,205
Liabilities and Equity
Current liabilities:
Accounts payable	$	32,032		$	21,189
Accrued compensation and benefits		13,128			12,660
Accrued expenses		4,011			4,158
Short-term lease liabilities		1,572			1,551
Sales allowances		1,006			1,464
Accrued severance and other charges		—			93
Income taxes payable		2			66
Short-term deferred revenue and customer prepayments		7,702			7,912
Total current liabilities		59,453			49,093
Long-term deferred revenue		270			413
Long-term income taxes payable		577			569
Long-term lease liabilities		7,952			3,225
Total liabilities		68,252			53,300
Commitments and contingencies (Note 10)
Equity:
Vicor Corporation stockholders’ equity:
Class B Common Stock: 10 votes per share, $.01 par value, 14,000,000 shares authorized, 11,758,218 shares issued and outstanding in 2022 and 2021		118			118
Common Stock: 1 vote per share, $.01 par value, 62,000,000 shares authorized 43,885,382 shares issued and 32,220,576 shares outstanding in 2022; 43,789,528 shares issued and 32,154,722 shares outstanding in 2021		440			439
Additional paid-in capital		352,253			345,664
Retained earnings		233,225			217,633
Accumulated other comprehensive loss		(2,246	)		(1,328	)
Treasury stock at cost: 11,634,806 shares in 2022 and 2021		(138,927	)		(138,927	)
Total Vicor Corporation stockholders’ equity		444,863			423,599
Noncontrolling interest		241			306
Total equity		445,104			423,905
Total liabilities and equity	$	513,356		$	477,205

See accompanying notes.

-1-

VICOR CORPORATION

Condensed Consolidated Statements of Operations

(In thousands, except per share amounts)

(Unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	2022			2021			2022			2021
Net revenues	$	102,186		$	95,376		$	190,468		$	184,172
Cost of revenues		55,337			45,505			106,018			89,601
Gross margin		46,849			49,871			84,450			94,571
Operating expenses:
Selling, general and administrative		20,035			16,589			38,603			33,543
Research and development		15,516			13,273			29,769			26,299
Total operating expenses		35,551			29,862			68,372			59,842
Income from operations		11,298			20,009			16,078			34,729
Other income (expense), net:
Total unrealized gains (losses) on available-for-sale securities, net		16			20			(87	)		44
Less: portion of (gains) losses recognized in other comprehensive income		(15	)		(19	)		89			(42	)
Net credit gains recognized in earnings		1			1			2			2
Other income (expense), net		83			372			244			603
Total other income (expense), net		84			373			246			605
Income before income taxes		11,382			20,382			16,324			35,334
Provision for income taxes		802			999			754			856
Consolidated net income		10,580			19,383			15,570			34,478
Less: Net loss attributable to
noncontrolling interest		(13	)		(11	)		(22	)		(8	)
Net income attributable to Vicor Corporation	$	10,593		$	19,394		$	15,592		$	34,486
Net income per common share attributable to Vicor Corporation:
Basic	$	0.24		$	0.45		$	0.35		$	0.79
Diluted	$	0.24		$	0.43		$	0.35		$	0.77
Shares used to compute net income per common share attributable to Vicor Corporation:
Basic		43,973			43,553			43,963			43,504
Diluted		44,866			44,841			44,910			44,841

See accompanying notes.

-2-

VICOR CORPORATION

Condensed Consolidated Statements of Comprehensive Income

(In thousands)

(Unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	2022			2021			2022			2021
Consolidated net income	$	10,580		$	19,383		$	15,570		$	34,478
Foreign currency translation losses, net of tax (1)		(385	)		(10	)		(579	)		(271	)
Unrealized losses on available-for-sale securities, net of tax (1)		(66	)		(231	)		(382	)		(359	)
Other comprehensive loss		(451	)		(241	)		(961	)		(630	)
Consolidated comprehensive income		10,129			19,142			14,609			33,848
Less: Comprehensive loss attributable to noncontrolling interest		(42	)		(12	)		(65	)		(29	)
Comprehensive income attributable to Vicor Corporation	$	10,171		$	19,154		$	14,674		$	33,877

(1) The deferred tax assets associated with foreign currency translation losses and unrealized losses on available-for-sale securities are completely offset by a tax valuation allowance as of June 30, 2022 and 2021. Therefore, there is no income tax benefit (provision) recognized for the three and six months ended June 30, 2022 and 2021.

See accompanying notes.

-3-

VICOR CORPORATION

Condensed Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)

	Six Months Ended June 30,
	2022			2021
Operating activities:
Consolidated net income	$	15,570		$	34,478
Adjustments to reconcile consolidated net income to net cash provided by operating activities:
Depreciation and amortization		6,665			5,618
Stock-based compensation expense		4,616			3,138
Decrease in long-term deferred revenue		(143	)		(160	)
Decrease in contingent consideration obligations		—			(74	)
Gain on disposal of equipment		—			106
Increase in other assets		133			37
Increase in long-term income taxes payable		8			6
Deferred income taxes		(58	)		5
Credit gain on available-for-sale securities		(2	)		(2	)
Change in current assets and liabilities, net		(11,381	)		(13,037	)
Net cash provided by operating activities		15,408			30,115
Investing activities:
Purchases of short-term investments		—			(50,706	)
Sales or maturities of short-term investments		25,000			30,000
Additions to property, plant and equipment		(36,878	)		(15,782	)
Other		—			(106	)
Net cash used for investing activities		(11,878	)		(36,594	)
Financing activities:
Proceeds from employee stock plans		1,974			4,751
Payment of contingent consideration obligations		—			(107	)
Net cash provided by financing activities		1,974			4,644
Effect of foreign exchange rates on cash		(245	)		(144	)
Net increase (decrease) in cash and cash equivalents		5,259			(1,979	)
Cash and cash equivalents at beginning of period		182,418			161,742
Cash and cash equivalents at end of period	$	187,677		$	159,763

See accompanying notes.

-4-

VICOR CORPORATION

Condensed Consolidated Statements of Equity

(In thousands)

(Unaudited)

	Class B Common Stock		Common Stock		Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Loss			Treasury Stock			Total Vicor Corporation Stockholders’ Equity			Noncontrolling Interest			Total Equity
Three months ended June 30, 2022
Balance on March 31, 2022	$	118	$	440	$	349,467	$	222,632	$	(1,824	)	$	(138,927	)	$	431,906		$	283		$	432,189
Issuance of Common Stock under employee stock plans						164										164						164
Stock-based compensation expense						2,622										2,622						2,622
Components of comprehensive income (loss), net of tax:
Net income (loss)								10,593								10,593			(13	)		10,580
Other comprehensive loss										(422	)					(422	)		(29	)		(451	)
Total comprehensive income (loss)																10,171			(42	)		10,129
Balance on June 30, 2022	$	118	$	440	$	352,253	$	233,225	$	(2,246	)	$	(138,927	)	$	444,863		$	241		$	445,104

	Class B Common Stock		Common Stock		Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Loss			Treasury Stock			Total Vicor Corporation Stockholders’ Equity			Noncontrolling Interest			Total Equity
Six months ended June 30, 2022
Balance on December 31, 2021	$	118	$	439	$	345,664	$	217,633	$	(1,328	)	$	(138,927	)	$	423,599		$	306		$	423,905
Issuance of Common Stock under employee stock plans				1		1,973										1,974						1,974
Stock-based compensation expense						4,616										4,616						4,616
Components of comprehensive income (loss), net of tax:
Net income (loss)								15,592								15,592			(22	)		15,570
Other comprehensive loss										(918	)					(918	)		(43	)		(961	)
Total comprehensive income (loss)																14,674			(65	)		14,609
Balance on June 30, 2022	$	118	$	440	$	352,253	$	233,225	$	(2,246	)	$	(138,927	)	$	444,863		$	241		$	445,104

	Class B Common Stock		Common Stock		Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Loss			Treasury Stock			Total Vicor Corporation Stockholders’ Equity			Noncontrolling Interest			Total Equity
Three months ended June 30, 2021
Balance on March 31, 2021	$	118	$	435	$	333,011	$	176,100	$	(573	)	$	(138,927	)	$	370,164		$	318		$	370,482
Issuance of Common Stock under employee stock plans				1		1,700										1,701						1,701
Stock-based compensation expense						1,567										1,567						1,567
Components of comprehensive income (loss), net of tax:
Net income (loss)								19,394								19,394			(11	)		19,383
Other comprehensive loss										(240	)					(240	)		(1	)		(241	)
Total comprehensive income (loss)																19,154			(12	)		19,142
Balance on June 30, 2021	$	118	$	436	$	336,278	$	195,494	$	(813	)	$	(138,927	)	$	392,586		$	306		$	392,892

-5-

VICOR CORPORATION

Condensed Consolidated Statements of Equity

(In thousands)

(Unaudited)

	Class B Common Stock		Common Stock		Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Loss			Treasury Stock			Total Vicor Corporation Stockholders’ Equity			Noncontrolling Interest			Total Equity
Six months ended June 30, 2021
Balance on December 31, 2020	$	118	$	433	$	328,392	$	161,008	$	(204	)	$	(138,927	)	$	350,820		$	335		$	351,155
Issuance of Common Stock under employee stock plans				3		4,748										4,751						4,751
Stock-based compensation expense						3,138										3,138						3,138
Components of comprehensive income (loss), net of tax:
Net income (loss)								34,486								34,486			(8	)		34,478
Other comprehensive loss										(609	)					(609	)		(21	)		(630	)
Total comprehensive income (loss)																33,877			(29	)		33,848
Balance on June 30, 2021	$	118	$	436	$	336,278	$	195,494	$	(813	)	$	(138,927	)	$	392,586		$	306		$	392,892

See accompanying notes.

-6-

VICOR CORPORATION

Notes to Condensed Consolidated Financial Statements

June 30, 2022

(unaudited)

1. Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements of Vicor Corporation and its consolidated subsidiaries (collectively, the “Company”) have been prepared in accordance with generally accepted accounting principles for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, these interim financial statements do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.

In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2022 are not necessarily indicative of the results that may be expected for any other interim period or the year ending December 31, 2022. The balance sheet at December 31, 2021 presented herein has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. For further information, refer to the consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 filed by the Company with the SEC on March 1, 2022 (“2021 Form 10-K”).

2. Inventories

Inventories were as follows (in thousands):

	June 30, 2022		December 31, 2021
Raw materials	$	64,978	$	51,289
Work-in-process		12,735		12,514
Finished goods		5,342		3,519
	$	83,055	$	67,322

3. Short-Term and Long-Term Investments

As of June 30, 2022 and December 31, 2021, the Company held $19,921,000 and $45,215,000, respectively, of short-term investments, consisting of obligations of the U.S. Treasury, all of which were debt securities with original maturities greater than three months but less than one year at the time of purchase.

As of June 30, 2022 and December 31, 2021, the Company held one auction rate security with a par value of $3,000,000 and an estimated fair value of approximately $2,552,000 and $2,639,000, respectively, purchased through and held in custody by a broker-dealer affiliate of Bank of America, N.A., that has experienced failed auctions (the “Failed Auction Security”) since February 2008. The Failed Auction Security held by the Company is Aaa/AA+ rated by major credit rating agencies, is collateralized by student loans, and is guaranteed by the U.S. Department of Education under the Federal Family Education Loan Program. Management is not aware of any reason to believe the issuer of the Failed Auction Security is presently at risk of default. Through June 30, 2022, the Company has continued to receive interest payments on the Failed Auction Security in accordance with the terms of its indenture. Management believes the Company ultimately should be able to liquidate the Failed Auction Security without significant loss primarily due to the overall quality of the issue held and the collateral securing the substantial majority of the underlying obligation. However, current conditions in the auction rate securities market have led management to conclude the recovery period for the Failed Auction Security exceeds 12 months. As a result, the Company continued to classify the Failed Auction Security as long-term as of June 30, 2022.

-7-

VICOR CORPORATION

Notes to Condensed Consolidated Financial Statements

June 30, 2022

(unaudited)

Details of our investments are as follows (in thousands):

	June 30, 2022
	Cash and Cash Equivalents		Short-Term Investments		Long-Term Investment
Measured at fair value:
Available-for-sale debt securities:
Money market funds	$	119,736	$	—	$	—
U.S. Treasury Obligations		—		19,921		—
Failed Auction Security		—		—		2,552
Total		119,736		19,921		2,552
Other measurement basis:
Cash on hand		67,941		—		—
Total	$	187,677	$	19,921	$	2,552

	December 31, 2021
	Cash and Cash Equivalents		Short-Term Investments		Long- Term Investment
Measured at fair value:
Available-for-sale debt securities:
Money market funds	$	94,282	$	—	$	—
U.S. Treasury Obligations		—		45,215		—
Failed Auction Security		—		—		2,639
Total		94,282		45,215		2,639
Other measurement basis:
Cash on hand		88,136		—		—
Total	$	182,418	$	45,215	$	2,639

The following is a summary of the available-for-sale securities (in thousands):

June 30, 2022	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
U.S. Treasury Obligations	$	20,083	$	—	$	162	$	19,921
Failed Auction Security		3,000		—		448		2,552

-8-

VICOR CORPORATION

Notes to Condensed Consolidated Financial Statements

June 30, 2022

(unaudited)

December 31, 2021	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
U.S. Treasury Obligations	$	45,238	$	—	$	23	$	45,215
Failed Auction Security		3,000		—		361		2,639

As of June 30, 2022, the Failed Auction Security had been in an unrealized loss position for greater than 12 months.

The amortized cost and estimated fair value of the available-for-sale securities on June 30, 2022, by type and contractual maturities, are shown below (in thousands):

	Cost		Estimated Fair Value
U.S. Treasury Obligations:
Maturities greater than three months but less than one year	$	20,083	$	19,921

	Cost		Estimated Fair Value
Failed Auction Security:
Due in twenty years	$	3,000	$	2,552

4. Fair Value Measurements

The Company accounts for certain financial assets at fair value, defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions market participants would use in pricing an asset or liability. A three-level hierarchy is used to show the extent and level of judgment used to estimate fair value measurements.

-9-

VICOR CORPORATION

Notes to Condensed Consolidated Financial Statements

June 30, 2022

(unaudited)

Assets and liabilities measured at fair value on a recurring basis included the following as of June 30, 2022 (in thousands):

	Using
	Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Fair Value as of June 30, 2022
Cash equivalents:
Money market funds	$	119,736	$	—	$	—	$	119,736
Short-term investments:
U.S. Treasury Obligations		19,921		—		—		19,921
Long-term investment:
Failed Auction Security		—		—		2,552		2,552

Assets and liabilities measured at fair value on a recurring basis included the following as of December 31, 2021 (in thousands):

	Using
	Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Fair Value as of December 31, 2021
Cash equivalents:
Money market funds	$	94,282	$	—	$	—	$	94,282
Short-term investments:
U.S. Treasury Obligations		45,215		—		—		45,215
Long-term investment:
Failed Auction Security		—		—		2,639		2,639

The change in the estimated fair value calculated for the investment valued on a recurring basis utilizing Level 3 inputs (i.e., the Failed Auction Security) for the six months ended June 30, 2022 was as follows (in thousands):

Balance at the beginning of the period	$	2,639
Credit gain on available-for-sale security included in Other income (expense), net		2
Loss included in Other comprehensive income		(89	)
Balance at the end of the period	$	2,552

Management utilized a probability weighted discounted cash flow model to determine the estimated fair value as of June 30, 2022.

-10-

VICOR CORPORATION

Notes to Condensed Consolidated Financial Statements

June 30, 2022

(unaudited)

5. Revenues

The following tables present the Company’s net revenues disaggregated by geography based on the location of the customer, by product line (in thousands):

	Three Months Ended June 30, 2022
	Brick Products		Advanced Products		Total
United States	$	18,668	$	12,782	$	31,450
Europe		5,041		2,229		7,270
Asia Pacific		9,846		52,550		62,396
All other		968		102		1,070
	$	34,523	$	67,663	$	102,186

	Six Months Ended June 30, 2022
	Brick Products		Advanced Products		Total
United States	$	32,729	$	23,408	$	56,137
Europe		12,083		4,997		17,080
Asia Pacific		23,367		92,045		115,412
All other		1,701		138		1,839
	$	69,880	$	120,588	$	190,468

	Three Months Ended June 30, 2021
	Brick Products		Advanced Products		Total
United States	$	19,708	$	14,356	$	34,064
Europe		10,224		1,285		11,509
Asia Pacific		24,045		25,339		49,384
All other		375		44		419
	$	54,352	$	41,024	$	95,376

	Six Months Ended June 30, 2021
	Brick Products		Advanced Products		Total
United States	$	38,291	$	22,905	$	61,196
Europe		18,420		2,280		20,700
Asia Pacific		51,373		49,992		101,365
All other		727		184		911
	$	108,811	$	75,361	$	184,172

-11-

VICOR CORPORATION

Notes to Condensed Consolidated Financial Statements

June 30, 2022

(unaudited)

The following tables present the Company’s net revenues disaggregated by the category of revenue, by product line (in thousands):

	Three Months Ended June 30, 2022
	Brick Products		Advanced Products		Total
Direct customers, contract manufacturers and non-stocking distributors	$	23,566	$	61,979	$	85,545
Stocking distributors, net of sales allowances		10,908		3,102		14,010
Non-recurring engineering		49		1,908		1,957
Royalties		—		656		656
Other		—		18		18
	$	34,523	$	67,663	$	102,186

	Six Months Ended June 30, 2022
	Brick Products		Advanced Products		Total
Direct customers, contract manufacturers and non-stocking distributors	$	47,967	$	109,450	$	157,417
Stocking distributors, net of sales allowances		21,672		6,846		28,518
Non-recurring engineering		241		3,294		3,535
Royalties		—		962		962
Other		—		36		36
	$	69,880	$	120,588	$	190,468

	Three Months Ended June 30, 2021
	Brick Products		Advanced Products		Total
Direct customers, contract manufacturers and non-stocking distributors	$	37,614	$	32,644	$	70,258
Stocking distributors, net of sales allowances		16,634		4,634		21,268
Non-recurring engineering		104		3,726		3,830
Royalties		—		3		3
Other		—		17		17
	$	54,352	$	41,024	$	95,376

-12-

VICOR CORPORATION

Notes to Condensed Consolidated Financial Statements

June 30, 2022

(unaudited)

	Six Months Ended June 30, 2021
	Brick Products		Advanced Products		Total
Direct customers, contract manufacturers and non-stocking distributors	$	81,422	$	61,701	$	143,123
Stocking distributors, net of sales allowances		27,181		8,772		35,953
Non-recurring engineering		208		4,797		5,005
Royalties		—		56		56
Other		—		35		35
	$	108,811	$	75,361	$	184,172

The following table presents the changes in certain contract assets and (liabilities) (in thousands):

	June 30, 2022			December 31, 2021			Change
Short-term deferred revenue and customer prepayments	$	(7,702	)	$	(7,912	)	$	210
Long-term deferred revenue		(270	)		(413	)		143
Deferred expenses		559			560			(1	)
Sales allowances		(1,006	)		(1,464	)		458

Deferred expenses are included in Other current assets in the accompanying Condensed Consolidated Balance Sheets.

The Company records deferred revenue, which represents a contract liability, when cash payments are received or due in advance of performance under a contract with a customer. The Company recognized revenue of approximately $1,136,000 and $931,000 for the three and six months ended June 30, 2022, respectively, and $2,410,000 and $3,081,000 for the three and six months ended June 30, 2021, respectively, that was included in deferred revenue at the beginning of each respective period.

-13-

VICOR CORPORATION

Notes to Condensed Consolidated Financial Statements

June 30, 2022

(unaudited)

6. Stock-Based Compensation

The Company uses the Black-Scholes option pricing model to calculate the fair value of stock option awards, whether they possess time-based vesting provisions or performance-based vesting provisions, and awards granted under the Vicor Corporation 2017 Employee Stock Purchase Plan (“ESPP”), as of their grant date. Stock-based compensation expense was as follows (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Cost of revenues	$	431	$	252	$	682	$	480
Selling, general and administrative		1,440		779		2,647		1,632
Research and development		751		536		1,287		1,026
Total stock-based compensation	$	2,622	$	1,567	$	4,616	$	3,138

Compensation expense by type of award was as follows (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Stock options	$	2,351	$	1,336	$	4,110	$	2,667
ESPP		271		231		506		471
Total stock-based compensation	$	2,622	$	1,567	$	4,616	$	3,138

7. Rental Income

Income, net under the Company’s operating lease agreement, for its owned facility leased to a third party in California, was approximately $198,000 and $396,000 for both the three and six months ended June 30, 2022 and 2021, respectively.

8. Income Taxes

The provision for income taxes is based on the estimated annual effective tax rate for the year, which includes estimated federal, state and foreign income taxes on the Company’s projected pre-tax income.

-14-

VICOR CORPORATION

Notes to Condensed Consolidated Financial Statements

June 30, 2022

(unaudited)

The provision for income taxes and the effective income tax rates were as follows (dollars in thousands):

	Three Months Ended June 30,						Six Months Ended June 30,
	2022			2021			2022			2021
Provision for income taxes	$	802		$	999		$	754		$	856
Effective income tax rate		7.0	%		4.9	%		4.6	%		2.4	%

The effective tax rates were lower than the statutory tax rates for the three and six months ended June 30, 2022 and 2021 primarily due to the Company’s full valuation allowance position against domestic deferred tax assets. The provision for income taxes for the three and six months ended June 30, 2022 and 2021 included estimated federal, state and foreign income taxes in jurisdictions in which the Company does not have sufficient tax attributes, offset by excess tax benefits related to stock based compensation during those periods.

As of June 30, 2022, the Company has a valuation allowance of approximately $43,329,000 against all net domestic deferred tax assets, for which realization cannot be considered more likely than not at this time. Management assesses the need for the valuation allowance on a quarterly basis. In assessing the need for a valuation allowance, the Company considers all positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies, and past financial performance. Despite recent positive operating results, the Company is in a cumulative loss position as of June 30, 2022, primarily due to tax deductions on 2020 and 2021 exercises of stock-based compensation. The Company faces uncertainties in forecasting its operating results due to supply and factory capacity constraints, certain process issues with the production of Advanced Products and the unpredictability in certain markets. This operating uncertainty also makes it difficult to predict the availability and utilization of tax benefits over the next several years. As a result, management has concluded, as of June 30, 2022, it is more likely than not the Company’s net domestic deferred tax assets will not be realized, and a full valuation allowance against all net domestic deferred tax assets is still warranted as of June 30, 2022. The valuation allowance against these deferred tax assets may require adjustment in the future based on changes in the mix of temporary differences, changes in tax laws, and operating performance. If the positive operating results continue, and the Company’s concerns about industry uncertainty and world events, supply and factory capacity constraints, and process issues with the production of Advanced Products are resolved, and the amount of tax benefits the Company is able to utilize to the point that the Company believes future taxable income can be more reliably forecasted, the Company may release all or a portion of the valuation allowance in the near-term. If and when the Company determines the valuation allowance should be released (i.e., reduced), the adjustment would result in a tax benefit reported in that period’s Consolidated Statements of Operations, the effect of which would be an increase in reported net income.

The Company was informed in September 2021 by the Internal Revenue Service of their intention to examine the Company’s 2019 Federal income tax return. There are no other audits or examinations in process in any other jurisdiction.

-15-

VICOR CORPORATION

Notes to Condensed Consolidated Financial Statements

June 30, 2022

(unaudited)

9. Net Income per Share

The following table sets forth the computation of basic and diluted net income per share (in thousands, except per share amounts):

	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Numerator:
Net income attributable to Vicor Corporation	$	10,593	$	19,394	$	15,592	$	34,486
Denominator:
Denominator for basic net income per share-weighted average shares (1)		43,973		43,553		43,963		43,504
Effect of dilutive securities:
Employee stock options (2)		893		1,288		947		1,337
Denominator for diluted net income per share – adjusted weighted-average shares and assumed conversions		44,866		44,841		44,910		44,841
Basic net income per share	$	0.24	$	0.45	$	0.35	$	0.79
Diluted net income per share	$	0.24	$	0.43	$	0.35	$	0.77

(1) Denominator represents weighted average number of shares of Common Stock and Class B Common Stock outstanding.

(2) Options to purchase 898,640 and 658,014 shares of Common Stock for the three and six months ended June 30, 2022, respectively, and options to purchase 138,125 and 90,339 shares of Common Stock for the three and six months ended June 30, 2021, respectively, were not included in the calculations of net income per share as the effect would have been antidilutive.

10. Commitments and Contingencies

At June 30, 2022, the Company had approximately $32,034,000 of cancelable and non-cancelable capital expenditure commitments, principally for manufacturing equipment, and approximately $10,640,000 of capital expenditure items which had been received and included in Property, plant and equipment in the accompanying Condensed Consolidated Balance Sheets, but not yet paid for.

The Company is the defendant in a patent infringement lawsuit originally filed on January 28, 2011 by SynQor, Inc. (“SynQor”) in the U.S. District Court (the “District Court”) for the Eastern District of Texas (the “Texas Action”). The complaint, as amended, alleges that the Company’s products, including but not limited to, unregulated bus converters used in intermediate bus architecture power supply systems, infringe SynQor’s U.S. patent numbers 7,072,190, 7,272,021, 7,564,702, and 8,023,290 (“the ‘190 patent”, “the ‘021 patent”, “the ‘702 patent”, and “the ‘290 patent”, respectively). SynQor’s complaint seeks an injunction against further infringement and an award of unspecified compensatory and enhanced damages, interest, costs and attorney fees. However, because each of the asserted SynQor patents has expired, an injunction is no longer available as relief should SynQor prevail in the Texas Action. The Company has denied that its products infringe any of the SynQor patents, and has asserted that the SynQor patents are invalid and/or unenforceable. The Company has also asserted counterclaims seeking damages from SynQor for deceptive trade practices and tortious interference with prospective economic advantage arising from SynQor’s attempted enforcement of its patents against the Company.

-16-

VICOR CORPORATION

Notes to Condensed Consolidated Financial Statements

June 30, 2022

(unaudited)

On November 24, 2015, the District Court ordered the Texas Action stayed pending completion of certain inter partes reexamination (“IPRx”) proceedings initiated by the Company at the United States Patent and Trademark Office (“USPTO”). In these IPRx proceedings, the Company challenged the validity of the SynQor patent claims asserted in the Texas Action. On November 16, 2021, the District Court issued an order lifting the stay. At a hearing on February 2, 2022, the District Court issued an order denying all pending summary judgment and other pre-trial motions without prejudice. The District Court further authorized the Company to file new motions for summary judgment, to be considered on an expedited schedule. The Company filed a motion for summary judgment of non-infringement on February 4, 2022. On May 25, 2022, a magistrate judge issued a report and recommendation recommending that the Company’s motion be denied. On June 8, 2022, the Company filed objections to that report and recommendation. The District Court has not yet ruled on those objections.    

On March 1, 2022, the Company also filed a motion for involuntary dismissal of the ‘290 patent from the case. On May 25, 2022, a magistrate judge issued a report and recommendation recommending that the Company’s motion be granted. On June 8, 2022, SynQor filed objections to that report and recommendation. The District Court has not yet ruled on those objections. On April 5, 2022, the Court entered a scheduling order setting a trial date of October 17, 2022.

The current status of the IPRx proceedings and related appeals is as follows:

• ‘190 patent: Certain claims of the ‘190 patent were found unpatentable by the United States Court of Appeals for the Federal Circuit (“Federal Circuit”) in a decision issued on March 13, 2015. The court remanded the remaining claims to the USPTO for further consideration. On February 20, 2019, the Patent Trial and Appeal Board (“PTAB”) of the USPTO issued a decision finding that all of the remaining challenged claims were unpatentable. SynQor appealed that decision. On February 22, 2021, the Federal Circuit issued a decision in that appeal. In a 2-1 ruling, the Federal Circuit vacated and remanded the PTAB’s decision, finding that the reasoning the PTAB had relied on in reaching its decision was precluded by certain prior PTAB rulings regarding the ‘290 and ‘702 patents and remanded the case to the PTAB for further proceedings. On April 7, 2021, the Company filed a petition for panel rehearing and rehearing en banc of the Federal Circuit’s February 22, 2021 decision. The Federal Circuit denied that petition on June 7, 2021. Accordingly, the matter was then remanded to the PTAB for further proceedings. On January 31, 2022, the PTAB issued a decision that reaffirmed the unpatentability of the claims of the ‘190 patent that had been found unpatentable by the Federal Circuit in its March 13, 2015 decision, and otherwise upheld the patentability of the remaining challenged claims of the ‘190 patent. On March 30, 2022, the Company filed an appeal of this decision to the Federal Circuit, where it remains pending.

• ‘021 patent: On August 30, 2017, the Federal Circuit issued a final decision upholding a PTAB decision finding all of the asserted claims of the ‘021 patent unpatentable. In addition, SynQor attempted to amend the ‘021 patent to add new claims during the IPRx. Those claims were rejected by the PTAB. SynQor subsequently filed an appeal with the Federal Circuit seeking to vacate that rejection as moot, in view of the expiry of the term of the ‘021 patent. On June 17, 2022, the Federal Circuit issued a decision vacating the PTAB’s rejection as moot.

• ‘702 patent: On August 30, 2017, the Federal Circuit issued a final decision upholding a PTAB decision finding all of the asserted claims of the ‘702 patent to be patentable.

• ‘290 patent: On June 16, 2021, the PTAB issued a decision finding all of the claims of the ‘290 patent unpatentable. SynQor has filed an appeal of that decision to the Federal Circuit, where it remains pending.

On January 23, 2018, the 20-year terms of the ‘190 patent, the ‘021 patent, the ‘702 patent and the ‘290 patent expired. As a consequence of these expirations, the Company cannot be liable under any of the SynQor patents for allegedly infringing activities occurring after that date. In addition, any amended claims that may issue as a result of any of the still-pending IPRx proceedings will have no effective term and cannot be the basis for any liability by the Company. As noted above, the IPRx proceedings relating to the asserted claims of the ‘190 and ‘290 patents remain pending before the PTAB or on appeal at the Federal Circuit.

-17-

VICOR CORPORATION

Notes to Condensed Consolidated Financial Statements

June 30, 2022

(unaudited)

The Company continues to believe none of its products, including its unregulated bus converters, infringe any valid claim of the asserted SynQor patents, either alone or when used in an intermediate bus architecture implementation. The Company believes SynQor’s claims lack merit and, therefore, it continues to vigorously defend itself against SynQor’s patent infringement allegations. The Company does not believe a loss is probable for this matter. If a loss were to be incurred, however, the Company cannot estimate the amount of possible loss or range of possible loss at this time.

In addition to the SynQor matter, the Company is involved in certain other litigation and claims incidental to the conduct of its business. While the outcome of lawsuits and claims against the Company cannot be predicted with certainty, management does not expect any current litigation or claims will have a material adverse impact on the Company’s financial position or results of operations.

11. Impact of Recently Issued Accounting Standards

New pronouncements issued but not effective until after June 30, 2022 are not expected to have a material impact on the Company’s consolidated financial statements.

-18-

VICOR CORPORATION

Management’s Discussion and Analysis of

Financial Condition and Results of Operation

June 30, 2022

Item 2 — Management’s Discussion and Analysis of Financial Condition and Results of Operations

Cautionary Note Regarding Forward-Looking Statements

The Company’s consolidated operating results are affected by a wide variety of factors that could materially and adversely affect revenues and profitability, including the risk factors described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. As a result of these and other factors, the Company may experience material fluctuations in future operating results on a quarterly or annual basis, which could materially and adversely affect its business, consolidated financial condition, and operating results, and the share price of its Common Stock. This document and other documents filed by the Company with the Securities and Exchange Commission (“SEC”) include forward-looking statements regarding future events and the Company’s future results that are subject to the safe harbor afforded under the Private Securities Litigation Reform Act of 1995 and other safe harbors afforded under the Securities Act of 1933 and the Securities Exchange Act of 1934. All statements other than statements of historical fact are statements that could be deemed forward-looking statements. Forward-looking statements are based on our current beliefs, expectations, estimates, forecasts, and projections for the future performance of the Company and are subject to risks and uncertainties. Forward-looking statements are identified by the use of words denoting uncertain, future events, such as “anticipate,” “assume,” “believe,” “continue,” “could,” “estimate,” “expect,” “future,” “goal,” “if,” “intend,” “may,” “plan,” “potential,” “project,” “prospective,” “seek,” “should,” “target,” “will,” or “would,” as well as similar words and phrases, including the negatives of these terms, or other variations thereof. Forward-looking statements also include, but are not limited to, statements regarding: our expectations that the Company has adequate resources to respond to financial and operational risks associated with the novel coronavirus (“COVID-19”) and regarding our and our customers’ ability to effectively conduct business during the pandemic; our ability to address certain supply chain risks; our ongoing development of power conversion architectures, switching topologies, materials, packaging, and products; the ongoing transition of our business strategically, organizationally, and operationally from serving a large number of relatively low-volume customers across diversified markets and geographies to serving a small number of relatively large volume customers; our intent to enter new market segments; the levels of customer orders overall and, in particular, from large customers and the delivery lead times associated therewith; anticipated new and existing customer wins; the financial and operational impact of customer changes to shipping schedules; the derivation of a portion of our sales in each quarter from orders booked in the same quarter; our intent to expand the percentage of revenue associated with licensing our intellectual property to third parties; our plans to invest in expanded manufacturing capacity, including the expansion of our Andover facility and the introduction of new manufacturing processes, and the timing, location, and funding thereof; our belief that cash generated from operations together with our available cash and cash equivalents and short-term investments will be sufficient to fund planned operational needs, capital equipment purchases, and planned construction, for the foreseeable future; our outlook regarding tariffs and the impact thereof on our business; our belief that we have limited exposure to currency risks; our intentions regarding the declaration and payment of cash dividends; our intentions regarding protecting our rights under our patents; and our expectation that no current litigation or claims will have a material adverse impact on our financial position or results of operations. These forward-looking statements are based upon our current expectations and estimates associated with prospective events and circumstances that may or may not be within our control and as to which there can be no assurance. Actual results could differ materially from those implied by forward-looking statements as a result of various factors, including but not limited to those described above, as well as those described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 under Part I, Item 1 — “Business,” under Part I, Item 1A — “Risk Factors,” under Part I, Item 3 — “Legal Proceedings,” and under Part II, Item 7 — “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and those described in this Quarterly Report on Form 10-Q, particularly under Part I, Item 2 – “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” The discussion of our business contained herein, including the identification and assessment of factors that may influence actual results, may not be exhaustive. Therefore, the information presented should be read together with other documents we file with the SEC from time to time, including our Annual Reports on Form 10-K, our Quarterly Reports on Form 10-Q and our Current Reports on Form 8-K, which may supplement, modify, supersede, or update the factors discussed in this Quarterly Report on Form 10-Q. Any forward-looking statement made in this Quarterly Report on Form 10-Q is based on information currently available to us and speaks only as of the date on which it is made. We do not undertake any obligation to update any forward-looking statements as a result of future events or developments, except as required by law.

-19-

VICOR CORPORATION

Management’s Discussion and Analysis of

Financial Condition and Results of Operation

June 30, 2022

Overview

We design, develop, manufacture, and market modular power components and power systems for converting electrical power for use in electrically-powered devices. Our competitive position is supported by innovations in product design and achievements in product performance, largely enabled by our focus on the research and development of advanced technologies and processes, often implemented in proprietary semiconductor circuitry, materials, and packaging. Many of our products incorporate patented or proprietary implementations of high-frequency switching topologies enabling power system solutions that are more efficient and much smaller than conventional alternatives. Our strategy emphasizes demonstrable product differentiation and a value proposition based on competitively superior solution performance, advantageous design flexibility, and a compelling total cost of ownership. While we offer a wide range of alternating current (“AC”) and direct current (“DC”) power conversion products, we consider our core competencies to be associated with 48V DC distribution, which offers numerous inherent cost and performance advantages over lower distribution voltages. However, we also offer products addressing other DC voltage standards (e.g., 380V for power distribution in data centers, 110V for rail applications, 28V for military and avionics applications, and 24V for industrial automation).

Based on design, performance, and form factor considerations, as well as the range of evolving applications for which our products are appropriate, we categorize our product portfolios as either “Advanced Products” or “Brick Products.” The Advanced Products category consists of our more recently introduced products, which are largely used to implement our proprietary Factorized Power Architecture™ (“FPA”), an innovative power distribution architecture enabling flexible, rapid power system design using individual components optimized to perform a specific conversion function.

The Brick Products category largely consists of our broad and well-established families of integrated power converters, incorporating multiple conversion stages, used in conventional power systems architectures. Given the growth profiles of the markets we serve with our Advanced Products line and our Brick Products line, our strategy involves a transition in organizational focus, emphasizing investment in our Advanced Products line and targeting high growth market segments with a low-mix, high-volume operational model, while maintaining a profitable business in the mature market segments we serve with our Brick Products line with a high-mix, low-volume operational model.

The applications in which our Advanced Products and Brick Products are used are typically in the higher-performance, higher-power segments of the market segments we serve. With our Advanced Products, we generally serve large Original Equipment Manufacturers (“OEMs”), Original Design Manufacturers (“ODMs”), and their contract manufacturers, with sales currently concentrated in the data center and hyperscaler segments of enterprise computing, in which our products are used for voltage distribution on server motherboards, in server racks, and across datacenter infrastructure. We have established a leadership position in the emerging market segment for powering high-performance processors used for acceleration of applications associated with artificial intelligence (“AI”). Our customers in the AI market segment include the leading innovators in processor and accelerator design, as well as early adopters in cloud computing and high performance computing. We also target applications in aerospace and aviation, defense electronics, industrial automation, instrumentation, test equipment, solid state lighting, telecommunications and networking infrastructure, and vehicles (notably in the autonomous driving, electric vehicle, and hybrid vehicle niches of the vehicle segment). With our Brick Products, we generally serve a fragmented base of large and small customers, concentrated in aerospace and defense electronics, industrial automation, industrial equipment, instrumentation and test equipment, and transportation (notably in rail and heavy equipment applications). With our strategic emphasis on larger, high-volume customers, we expect to experience over time a greater concentration of sales among relatively fewer customers.

Our quarterly consolidated operating results can be difficult to forecast and have been subject to significant fluctuations. We plan our production and inventory levels based on management’s estimates of customer demand, customer forecasts, and other information sources. Customer forecasts, particularly those of OEM, ODM, and contract manufacturing customers to which we supply Advanced Products in high volumes, are subject to scheduling changes on short notice, contributing to operating inefficiencies and excess costs. In addition, external factors such as supply chain uncertainties, which are often associated with the cyclicality of the electronics industry, regional macroeconomic and trade-related circumstances, and force majeure events (most recently evidenced by the COVID-19 pandemic), have caused our operating results to vary meaningfully. Our quarterly gross margin as a percentage of net revenues may vary, depending on production volumes, average selling prices, average unit costs, the mix of products sold during that quarter, and the level of importation of raw materials subject to tariffs. Our quarterly operating margin as a percentage of net revenues also may vary with changes in revenue and product level profitability, but our operating costs are largely associated with compensation and related employee costs, which are not subject to sudden or significant changes.

-20-

VICOR CORPORATION

Management’s Discussion and Analysis of

Financial Condition and Results of Operation

June 30, 2022

Ongoing / Potential Impacts of the COVID-19 Pandemic on the Company

As of the date of this report, the number of Company employees diagnosed with COVID-19 and the corresponding absenteeism due to COVID-19 are negligible. While the productivity of our factory is not currently impacted by COVID-19, productivity may be reduced if quarantine rates increase or if the number of employees diagnosed with COVID-19 requires further implementation of restrictive health and safety measures, including factory closure. We continue to operate with three shifts in our factory, and, with few exceptions, our engineering, sales, and administrative personnel are working from the Company’s offices.

We are closely monitoring the operating performance and financial health of our customers, business partners, and suppliers, but an extended period of operational constraints brought about by the pandemic could cause financial hardship within our customer base and supply chain. Such hardship may continue to disrupt customer demand and limit our customers’ ability to meet their obligations to us. Similarly, such hardship within our supply chain could continue to restrict our access to raw materials or services. Additionally, restrictions or disruptions of transportation, such as reduced availability of cargo transport by ship or air, could result in higher costs and inbound and outbound delays. We have taken steps to address certain supply chain risks, and we believe our actions have mitigated those risks to date; however, there are no assurances that those steps will continue to mitigate risks in the remainder of 2022 and beyond.

Although there is uncertainty regarding the extent to which the pandemic will continue to impact our operational and financial results in the future, the Company’s high level of liquidity, flexible operational model, existing raw material inventories, and increased use of second sources for critical manufacturing inputs together support management’s belief the Company will be able to effectively conduct business until the pandemic passes.

We are monitoring the rapidly changing circumstances, and may take additional actions to address COVID-19 risks as they evolve. Because much of the potential negative impact of the pandemic is associated with risks outside of our control, we cannot estimate the extent of such impact on our financial or operational performance, or when such impact might occur.

Summary of Second Quarter 2022 Financial Performance Compared to First Quarter 2022 Financial Performance

The following summarizes our financial performance for the second quarter of 2022, compared to the first quarter of 2022:

• Net revenues increased 15.7% to $102,186,000 for the second quarter of 2022, from $88,282,000 for the first quarter of 2022. Net revenues for Brick Products decreased 2.4% compared to the first quarter of 2022, primarily due to market conditions in Europe and in the Asia Pacific region. Advanced Products revenue rose 27.8% sequentially compared to the first quarter of 2022. This growth, though, continued to be constrained by limited component availability due to global semiconductor supply allocation issues experienced during the quarter, along with certain internal processing and testing constraints.

• Export sales represented approximately 69.2% of total net revenues in the second quarter of 2022 as compared to 72.0% in the first quarter of 2022.

• Gross margin increased to $46,849,000 for the second quarter of 2022 from $37,601,000 for the first quarter of 2022, and gross margin, as a percentage of net revenues, increased to 45.8% for the second quarter of 2022 from 42.6% for the first quarter of 2022. Both the increase in gross margin dollars and gross margin percentage were primarily due to the increase in net revenues and improved absorption of fixed costs due to increased volumes.

• Backlog, which represents the total value of orders for products for which shipment is scheduled within the next 12 months, was approximately $410,015,000 at the end of the second quarter of 2022, as compared to $423,738,000 at the end of the first quarter of 2022. The decrease in backlog was primarily due to an increase in net revenues combined with a decline in bookings during the quarter as a result of securing bookings in prior quarters that now form a large part of our backlog.

-21-

VICOR CORPORATION

Management’s Discussion and Analysis of

Financial Condition and Results of Operation

June 30, 2022

• Operating expenses for the second quarter of 2022 increased $2,730,000, or 8.3%, to $35,551,000 from $32,821,000 for the first quarter of 2022. Selling, general, and administrative expenses increased approximately $1,467,000, primarily due to increases in legal fees and compensation expense. Research and development expenses increased approximately $1,263,000, primarily due to increases in project and pre-production materials and compensation expense.

• We reported net income for the second quarter of 2022 of $10,593,000, or $0.24 per diluted share, compared to net income of $4,999,000, or $0.11 per diluted share, for the first quarter of 2022.

• For the second quarter of 2022, depreciation and amortization totaled $3,369,000 and capital additions totaled $14,195,000 as compared to depreciation and amortization of $3,296,000 and capital additions of $22,683,000 for the first quarter of 2022.

• Inventories increased by approximately $9,194,000, or 12.4%, to $83,055,000 at June 30, 2022, compared to $73,861,000 at March 31, 2022, primarily consisting of raw materials, to support higher planned revenues later in the year.

Three Months Ended June 30, 2022 Compared to Three Months Ended June 30, 2021

Net revenues for the second quarter of 2022 were $102,186,000, an increase of $6,810,000, or 7.1%, as compared to $95,376,000 for the second quarter of 2021. Net revenues, by product line, for the three months ended June 30, 2022 and 2021 were as follows (dollars in thousands):

					Increase (decrease)
	2022		2021		$		%
Brick Products	$	34,523	$	54,352	$	(19,829)		(36.5	)%
Advanced Products		67,663		41,024		26,639		64.9	%
Total	$	102,186	$	95,376	$	6,810		7.1	%

The increase in net revenues for Advanced Products was primarily the result of growth in the data center and high performance computing business. The decrease in net revenues for Brick Products was primarily due to unfavorable market conditions in Europe and the Asia Pacific region.

Gross margin for the second quarter of 2022 decreased $3,022,000, or 6.1%, to $46,849,000, from $49,871,000 for the second quarter of 2021. Gross margin, as a percentage of net revenues, decreased to 45.8% for the second quarter of 2022, compared to 52.3% for the second quarter of 2021. The decrease in gross margin dollars and gross margin percentage was primarily due to unfavorable changes in product mix, a negative impact from production inefficiencies associated with initial production volumes of new products, and certain supply chain cost increases.

-22-

VICOR CORPORATION

Management’s Discussion and Analysis of

Financial Condition and Results of Operation

June 30, 2022

Selling, general, and administrative expenses were $20,035,000 for the second quarter of 2022, an increase of $3,446,000, or 20.8%, from $16,589,000 for the second quarter of 2021. Selling, general, and administrative expenses as a percentage of net revenues increased to 19.6% for the second quarter of 2022 from 17.4% for the second quarter of 2021. The components of the $3,446,000 increase in selling, general and administrative expenses for the second quarter of 2022 from the second quarter of 2021 were as follows (dollars in thousands):

	Increase (decrease)
Legal fees	$	1,534		204.9	%(1)
Compensation		1,466		13.6	%(2)
Outside services		278		51.1	%(3)
Travel expense		251		97.9	%(4)
Computer and software expense		125		40.5	%
Facilities allocations		(127	)	(33.0	)%
Other, net		(81	)	(2.2	)%
	$	3,446		20.8	%

(1) Increase primarily attributable to an increase in activity related to the SynQor litigation (see Note 10 to the Condensed Consolidated Financial Statements) and for certain corporate legal matters.

(2) Increase primarily attributable to an increase in headcount, annual compensation adjustments in May 2022, and higher stock-based compensation expense associated with stock options awarded in April 2022.

(3) Increase primarily attributable to an increase in the use of outside service providers at our Andover, MA facility.

(4) Increase primarily attributable to an increase in travel by the Company’s sales and marketing personnel.

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VICOR CORPORATION

Management’s Discussion and Analysis of

Financial Condition and Results of Operation

June 30, 2022

Research and development expenses were $15,516,000 for the second quarter of 2022, an increase of $2,243,000, or 16.9%, compared to $13,273,000 for the second quarter of 2021. As a percentage of net revenues, research and development expenses increased to 15.2% for the second quarter of 2022 from 13.9% for the second quarter of 2021. The components of the $2,243,000 increase in research and development expenses were as follows (dollars in thousands):

	Increase
Compensation	$	818	8.6	%(1)
Overhead absorption		373	47.5	%(2)
Supplies		297	74.3	%(3)
Project and pre-production materials		226	10.0	%
Depreciation and amortization		106	21.4	%
Facilities allocations		99	15.6	%
Deferred costs		88	46.8	%
Travel expense		59	182.7	%
Other, net		177	18.7	%
	$	2,243	16.9	%

(1) Increase primarily attributable to an increase in headcount, annual compensation adjustments in May 2022, and higher stock-based compensation expense associated with stock options awarded in April 2022.

(2) Increase primarily attributable to a decrease in research and development (“R&D”) personnel incurring time on production activities, compared to R&D activities.

(3) Increase in engineering supplies.

The significant components of ‘‘Other income (expense), net’’ for the three months ended June 30, and the changes between the periods were as follows (in thousands):

	2022			2021			Increase (decrease)
Interest income	$	274		$	276		$	(2	)
Rental income		198			198			—
Foreign currency losses, net		(397	)		(12	)		(385	)
Other, net		9			(89	)		98
	$	84		$	373		$	(289	)

Our exposure to market risk fluctuations in foreign currency exchange rates relates to the operations of Vicor Japan Company, Ltd. (“VJCL”), for which the functional currency is the Japanese Yen, and all other subsidiaries in Europe and Asia, for which the functional currency is the U.S. Dollar. These subsidiaries in Europe and Asia experienced more unfavorable foreign currency exchange rate fluctuations in the second quarter of 2022 compared to the second quarter of 2021.

Income before income taxes was $11,382,000 for the second quarter of 2022, as compared to $20,382,000 for the second quarter of 2021.

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VICOR CORPORATION

Management’s Discussion and Analysis of

Financial Condition and Results of Operation

June 30, 2022

The provision for income taxes and the effective income tax rates for the three months ended June 30, 2022 and 2021 were as follows (dollars in thousands):

	2022			2021
Provision for income taxes	$	802		$	999
Effective income tax rate		7.0	%		4.9	%

The effective tax rates were lower than the statutory tax rates for the three months ended June 30, 2022 and 2021 primarily due to the Company’s full valuation allowance position against domestic deferred tax assets. The provision for income taxes for the three months ended June 30, 2022 and 2021 included estimated federal, state and foreign income taxes in jurisdictions in which the Company does not have sufficient tax attributes, offset by excess tax benefits related to stock based compensation during those periods.

See Note 8 to the Condensed Consolidated Financial Statements for disclosure regarding our current assessment of the valuation allowance against all domestic deferred tax assets, and the possible release (i.e., reduction) of the allowance in the future.

We reported net income for the second quarter of 2022 of $10,593,000, or $0.24 per diluted share, compared to $19,394,000, or $0.43 per diluted share, for the second quarter of 2021.

Six Months Ended June 30, 2022 Compared to Six Months Ended June 30, 2021

Net revenues for the six months ended June 30, 2022 were $190,468,000, an increase of $6,296,000, or 3.4%, from $184,172,000 for the six months ended June 30, 2021. Net revenues, by product line, for the six months ended June 30, 2022 and the six months ended June 30, 2021 were as follows (dollars in thousands):

					Increase (decrease)
	2022		2021		$			%
Brick Products	$	69,880	$	108,811	$	(38,931	)		(35.8	)%
Advanced Products		120,588		75,361		45,227			60.0	%
Total	$	190,468	$	184,172	$	6,296			3.4	%

The increase in net revenues for Advanced Products was primarily the result of growth in the data center and high performance computing business. The decrease in net revenues for Brick Products was primarily due to unfavorable market conditions.

Gross margin for the six months ended June 30, 2022 decreased $10,121,000, or 10.7%, to $84,450,000 from $94,571,000 for the six months ended June 30, 2021. Gross margin, as a percentage of net revenues, decreased to 44.3% for the six month period ended June 30, 2022, as compared to 51.3% for the six month period ended June 30, 2021. The decrease in gross margin dollars and gross margin percentage was primarily due to unfavorable changes in product mix, a negative impact from production inefficiencies associated with initial production volumes of new products, and certain supply chain cost increases.

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VICOR CORPORATION

Management’s Discussion and Analysis of

Financial Condition and Results of Operation

June 30, 2022

Selling, general and administrative expenses were $38,603,000 for the six months ended June 30, 2022, an increase of $5,060,000, or 15.1%, compared to $33,543,000 for the six months ended June 30, 2021. Selling, general and administrative expenses as a percentage of net revenues increased to 20.3% for the six months ended June 30, 2022 from 18.2% for the six months ended June 30, 2021. The components of the $5,060,000 increase in selling, general and administrative expenses for the six months ended June 30, 2022 compared to the six months ended June 30, 2021 were as follows (dollars in thousands):

	Increase (decrease)
Legal fees	$	2,025		151.1	%(1)
Compensation		1,951		8.9	%(2)
Outside services		770		69.3	%(3)
Depreciation and amortization		432		26.5	%(4)
Travel expense		387		80.6	%(5)
Computer and software expense		143		23.6	%
Commissions		(284	)	(16.5	)%(6)
Facilities allocations		(285	)	(35.3	)%(7)
Other, net		(79	)	(2.1	)%
	$	5,060		15.1	%

(1) Increase primarily attributable to an increase in activity related to the SynQor litigation (see Note 10 to the Condensed Consolidated Financial Statements) and for certain corporate legal matters.

(2) Increase primarily attributable to an increase in headcount, annual compensation adjustments in May 2022, and higher stock-based compensation expense associated with stock options awarded in April 2022.

(3) Increase primarily attributable to an increase in the use of outside service providers at our Andover, MA facility.

(4) Increase attributable to net additions of furniture and fixtures and capitalization of building improvements.

(5) Increase primarily attributable to an increase in travel by the Company’s sales and marketing personnel.

(6) Decrease primarily attributable to a decrease in net revenues subject to commissions.

(7) Decrease primarily attributable to a decrease in utilities and building maintenance expenses.

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VICOR CORPORATION

Management’s Discussion and Analysis of

Financial Condition and Results of Operation

June 30, 2022

Research and development expenses were $29,769,000 for the six months ended June 30, 2022, an increase of $3,470,000, or 13.2%, from $26,299,000 for the six months ended June 30, 2021 As a percentage of net revenues, research and development expenses increased to 15.6% for the six month period ended June 30, 2022 from 14.3% for the six month period ended June 30, 2021. The components of the $3,470,000 increase in research and development expenses for the six months ended June 30, 2022 compared to the six months ended June 30, 2021 were as follows (dollars in thousands):

	Increase
Compensation	$	1,211	6.4	%(1)
Overhead absorption		560	42.8	%(2)
Supplies		473	68.6	%(3)
Project and pre-production materials		187	4.5	%
Depreciation and amortization		181	17.9	%
Facilities allocations		132	9.7	%
Deferred costs		124	43.7	%
Travel expense		106	195.1	%
Computer and software expense		83	22.0	%
Other, net		413	31.2	%
	$	3,470	13.2	%

(1) Increase primarily attributable to an increase in headcount, annual compensation adjustments in May 2022, and higher stock-based compensation expense associated with stock options awarded in April 2022.

(2) Increase primarily attributable to a decrease in R&D personnel incurring time on production activities, compared to R&D activities.

(3) Increase in engineering supplies.

The significant components of ‘‘Other income (expense), net’’ for the six months ended June 30, 2022 and the six months ended June 30, 2021 and the changes from period to period were as follows (in thousands):

	2022			2021			Increase (decrease)
Interest income	$	415		$	469		$	(54	)
Rental income		396			396			—
Foreign currency losses, net		(604	)		(174	)		(430	)
Other, net		39			(86	)		125
	$	246		$	605		$	(359	)

Our exposure to market risk fluctuations in foreign currency exchange rates relates to the operations of VJCL, for which the functional currency is the Japanese Yen, and all other subsidiaries in Europe and Asia, for which the functional currency is the U.S. Dollar. These subsidiaries in Europe and Asia have experienced more unfavorable foreign currency exchange rate fluctuations in 2022 compared to 2021.

-27-

VICOR CORPORATION

Management’s Discussion and Analysis of

Financial Condition and Results of Operation

June 30, 2022

Income before income taxes was $16,324,000 for the six months ended June 30, 2022, as compared to $35,334,000 for the six months ended June 30, 2021.

The provision for income taxes and the effective income tax rates for the six months ended June 30, 2022 and 2021 were as follows (dollars in thousands):

	2022			2021
Provision for income taxes	$	754		$	856
Effective income tax rate		4.6	%		2.4	%

The effective tax rates were lower than the statutory tax rates for the six months ended June 30, 2022 and 2021 primarily due to the Company’s full valuation allowance position against domestic deferred tax assets. The provision for income taxes for the six months ended June 30, 2022 and 2021 included estimated federal, state and foreign income taxes in jurisdictions in which the Company does not have sufficient tax attributes, offset by excess tax benefits related to stock based compensation during those periods.

See Note 8 to the Condensed Consolidated Financial Statements for disclosure regarding our current assessment of the valuation allowance against all domestic deferred tax assets, and the possible release (i.e., reduction) of the allowance in the future.

We reported net income for the six months ended June 30, 2022 of $15,592,000, or $0.35 per diluted share, as compared to $34,486,000, or $0.77 per diluted share, for the six months ended June 30, 2021.

Liquidity and Capital Resources

As of June 30, 2022, we had $187,677,000 in cash and cash equivalents and $19,921,000 of highly liquid short-term investments. The ratio of total current assets to total current liabilities was 5.9:1 as of June 30, 2022 and 7.3:1 as of December 31, 2021. Working capital, defined as total current assets less total current liabilities, decreased $14,789,000 to $292,878,000 as of June 30, 2022 from $307,667,000 as of December 31, 2021.

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VICOR CORPORATION

Management’s Discussion and Analysis of

Financial Condition and Results of Operation

June 30, 2022

The changes in working capital from December 31, 2021 to June 30, 2022 were as follows (in thousands):

	Increase (decrease)
Cash and cash equivalents	$	5,259
Short-term investments		(25,294	)
Accounts receivable		(561	)
Inventories		15,733
Other current assets		434
Accounts payable		(10,843	)
Accrued compensation and benefits		(468	)
Accrued expenses		240
Sales allowances		458
Short-term lease liabilities		(21	)
Income taxes payable		64
Short-term deferred revenue		210
	$	(14,789	)

The primary sources of cash for the six months ended June 30, 2022 were $25,000,000 from the sale or maturities of short-term investments, $15,408,000 generated from operations, and $1,974,000 received in connection with the exercise of options to purchase our Common Stock awarded under our stock option plans and the issuance of Common Stock under our 2017 Employee Stock Purchase Plan. The primary uses of cash during the six months ended June 30, 2022 were for the purchase of property and equipment of $36,878,000.

In November 2000, our Board of Directors authorized the repurchase of up to $30,000,000 of our Common Stock (the “November 2000 Plan”). The November 2000 Plan authorizes us to make such repurchases from time to time in the open market or through privately negotiated transactions. The timing and amounts of Common Stock repurchases are at the discretion of management based on its view of economic and financial market conditions. We did not repurchase shares of Common Stock under the November 2000 Plan during the six months ended June 30, 2022. As of June 30, 2022, we had approximately $8,541,000 remaining available for repurchases of our Common Stock under the November 2000 Plan.

As of June 30, 2022, we had a total of approximately $32,034,000 of cancelable and non-cancelable capital expenditure commitments, principally for manufacturing and production equipment, which we intend to fund with existing cash, and approximately $10,640,000 of capital expenditure items which had been received and included in Property, plant and equipment in the accompanying Condensed Consolidated Balance Sheets, but not yet paid for. As of June 30, 2022, we had approximately $15,661,000 of remaining capital expenditures expected to be incurred through the remainder of 2022 associated with the construction of a 90,000 sq. ft. addition to the Company’s existing manufacturing facility and the installation of new manufacturing and production equipment. Our primary needs for liquidity are for making continuing investments in manufacturing and production equipment and for funding the construction of the additional manufacturing space adjoining our existing Andover manufacturing facility (as described above), including architectural and construction costs. We believe cash generated from operations together with our available cash and cash equivalents and short-term investments will be sufficient to fund planned operational needs, capital equipment purchases, and the planned construction, for the foreseeable future.

We do not consider the impact of inflation and changing prices on our business activities or fluctuations in the exchange rates for foreign currency transactions to have been significant during the last three fiscal years.

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VICOR CORPORATION

Management’s Discussion and Analysis of

Financial Condition and Results of Operation

June 30, 2022

Critical Accounting Policies and Estimates

There have been no material changes in our judgments and assumptions associated with the development of our critical accounting estimates during the period ended June 30, 2022. Refer to the section entitled “Critical Accounting Policies and Estimates” in Part II, Item 7 – “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.

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Vicor Corporation

June 30, 2022

Item 3 — Quantitative and Qualitative Disclosures About Market Risk

We are exposed to a variety of market risks, including changes in interest rates affecting the return on our cash and cash equivalents, our short-term investments and fluctuations in foreign currency exchange rates. As our cash and cash equivalents and short-term investments consist principally of cash accounts, money market securities, and U.S. Treasury securities, which are short-term in nature, we believe our exposure to market risk on interest rate fluctuations for these investments is not significant. As of June 30, 2022, our long-term investment portfolio, recorded on our Condensed Consolidated Balance Sheet as “Long-term investment, net”, consisted of a single auction rate security with a par value of $3,000,000, purchased through and held in custody by a broker-dealer affiliate of Bank of America, N.A., that has experienced failed auctions (the “Failed Auction Security”) since February 2008. While the Failed Auction Security is Aaa/AA+ rated by major credit rating agencies, collateralized by student loans and guaranteed by the U.S. Department of Education under the Federal Family Education Loan Program, continued failure to sell at its periodic auction dates (i.e., reset dates) could negatively impact the carrying value of the investment, in turn leading to impairment charges in future periods. Periodic changes in the fair value of the Failed Auction Security attributable to credit loss (i.e., risk of the issuer’s default) are recorded through earnings as a component of “Other income (expense), net”, with the remainder of any periodic change in fair value not related to credit loss (i.e., temporary “mark-to-market” carrying value adjustments) recorded in “Accumulated other comprehensive loss”, a component of Stockholders’ Equity. Should we conclude a decline in the fair value of the Failed Auction Security is other than temporary, such losses would be recorded through earnings as a component of “Other income (expense), net”. We do not believe there was an “other-than-temporary” decline in value in this security as of June 30, 2022.

Our exposure to market risk for fluctuations in foreign currency exchange rates relates to the operations of VJCL, for which the functional currency is the Japanese Yen, and changes in the relative value of the Yen to the U.S. Dollar. The functional currency of all other subsidiaries in Europe and other subsidiaries in Asia is the U.S. Dollar. While we believe the risk of fluctuations in foreign currency exchange rates for these subsidiaries is generally not significant, they can be subject to substantial currency changes, and therefore foreign exchange exposures.

Item 4 — Controls and Procedures

(a) Disclosure regarding controls and procedures.

As required by Rule 13a-15 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), management, with the participation of our Chief Executive Officer (“CEO”) (who is our principal executive officer) and Chief Financial Officer (“CFO”) (who is our principal financial officer), conducted an evaluation of the effectiveness of our disclosure controls and procedures as of the end of the last fiscal quarter (i.e., June 30, 2022). The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure information required to be disclosed by a company in the reports it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Management recognizes any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of June 30, 2022, our CEO and CFO concluded, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level.

A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. Accordingly, management, including the CEO and CFO, recognizes our disclosure controls or our internal control over financial reporting may not prevent or detect all errors and all fraud. The design of a control system must reflect the fact there are resource constraints, and the benefits of controls must be considered relative to their costs. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls is based in part on certain assumptions about the

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Vicor Corporation

June 30, 2022

likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Projections of any control’s effectiveness to future periods are subject to risks. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures.

(b) Changes in internal control over financial reporting.

There was no change in our internal control over financial reporting that occurred during the fiscal quarter ended June 30, 2022, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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Vicor Corporation

Part II – Other Information

June 30, 2022

Item 1 — Legal Proceedings

See Note 10. Commitments and Contingencies in the Notes to Condensed Consolidated Financial Statements in Part I, Item 1 – “Financial Statements.”

Item 1A — Risk Factors

There have been no material changes in the risk factors described in Part I, Item 1A – “Risk Factors” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.

Item 6 — Exhibits

Exhibit Number	Description
3.1	Restated Certificate of Incorporation, dated February 28, 1990 (1)
3.2	Certificate of Ownership and Merger Merging Westcor Corporation, a Delaware Corporation, into Vicor Corporation, a Delaware corporation, dated December 3, 1990 (1)
3.3	Certificate of Amendment of Restated Certificate of Incorporation, dated May 10, 1991 (1)
3.4	Certificate of Amendment of Restated Certificate of Incorporation, dated June 23, 1992 (1)
3.5	Bylaws, as amended (2)
31.1	Certification of Chief Executive Officer pursuant to Rule 13a-14(a) of the Exchange Act.
31.2	Certification of Chief Financial Officer pursuant to Rule 13a-14(a) of the Exchange Act.
32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS	Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH	Inline XBRL Taxonomy Extension Schema Document.
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

(1) Filed as an exhibit to the Company’s Annual Report on Form 10-K filed on March 29, 2001 (File No. 000-18277) and incorporated herein by reference.

(2) Filed as an exhibit to the Company’s Current Report on Form 8-K filed on June 4, 2020 (File No. 000-18277) and incorporated herein by reference.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	VICOR CORPORATION
Date: August 3, 2022	By:	/s/ Patrizio Vinciarelli
		Patrizio Vinciarelli
		Chairman of the Board, President and
		Chief Executive Officer
		(Principal Executive Officer)
Date: August 3, 2022	By:	/s/ James F. Schmidt
		James F. Schmidt
		Vice President, Chief Financial Officer
		(Principal Financial Officer)

-34-

EX-31.1

Exhibit 31.1

CHIEF EXECUTIVE OFFICER CERTIFICATION

I, Patrizio Vinciarelli, certify:

1. I have reviewed this Quarterly Report on Form 10-Q of Vicor Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: August 3, 2022	/s/ Patrizio Vinciarelli
	Patrizio Vinciarelli
	Chief Executive Officer
	(Principal Executive Officer)

EX-31.2

Exhibit 31.2

CHIEF FINANCIAL OFFICER CERTIFICATION

I, James F. Schmidt, certify:

1. I have reviewed this Quarterly Report on Form 10-Q of Vicor Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: August 3, 2022	/s/ James F. Schmidt
		James F. Schmidt
		Vice President, Chief Financial Officer
		(Principal Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Vicor Corporation (the “Company”) on Form 10-Q for the period ended June 30, 2022 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Patrizio Vinciarelli, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Patrizio Vinciarelli

Patrizio Vinciarelli

President, Chairman of the Board and

Chief Executive Officer

August 3, 2022

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Vicor Corporation (the “Company”) on Form 10-Q for the period ended June 30, 2022 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, James F. Schmidt, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ James F. Schmidt

James F. Schmidt

Vice President, Chief Financial Officer

August 3, 2022

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

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Cover Page - shares	6 Months Ended
	Jun. 30, 2022	Jul. 25, 2022
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2022
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q2
Entity Registrant Name	VICOR CORPORATION
Entity Central Index Key	0000751978
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Trading Symbol	VICR
Entity Current Reporting Status	Yes
Entity Shell Company	false
Entity Small Business	false
Entity Emerging Growth Company	false
Document Transition Report	false
Document Quarterly Report	true
Entity File Number	0-18277
Entity Interactive Data Current	Yes
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	04-2742817
Entity Address, Address Line One	25 Frontage Road
Entity Address, City or Town	Andover
Entity Address, Postal Zip Code	01810
City Area Code	978
Local Phone Number	470-2900
Security Exchange Name	NASDAQ
Entity Address, State or Province	MA
Title of 12(b) Security	Common Stock
Common Stock [Member]
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		32,225,594
Common Class B [Member]
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		11,758,218

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Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Current assets:
Cash and cash equivalents	$ 187,677	$ 182,418
Short-term investments	19,921	45,215
Accounts receivable, net	54,536	55,097
Inventories	83,055	67,322
Other current assets	7,142	6,708
Total current assets	352,331	356,760
Long-term deferred tax assets, net	266	208
Long-term investment, net	2,552	2,639
Property, plant and equipment, net	156,815	115,975
Other assets	1,392	1,623
Total assets	513,356	477,205
Current liabilities:
Accounts payable	32,032	21,189
Accrued compensation and benefits	13,128	12,660
Accrued expenses	4,011	4,158
Short-term lease liabilities	1,572	1,551
Accrued severance and other charges		93
Sales allowances	1,006	1,464
Income taxes payable	2	66
Short-term deferred revenue and customer prepayments	7,702	7,912
Total current liabilities	59,453	49,093
Long-term deferred revenue	270	413
Long-term income taxes payable	577	569
Long-term lease liabilities	7,952	3,225
Total liabilities	68,252	53,300
Commitments and contingencies (Note 10)
Vicor Corporation stockholders' equity:
Additional paid-in capital	352,253	345,664
Retained earnings	233,225	217,633
Accumulated other comprehensive loss	(2,246)	(1,328)
Treasury stock at cost: 11,634,806 shares in 2022 and 2021	(138,927)	(138,927)
Total Vicor Corporation stockholders' equity	444,863	423,599
Noncontrolling interest	241	306
Total equity	445,104	423,905
Total liabilities and equity	513,356	477,205
Class B Common Stock [Member]
Vicor Corporation stockholders' equity:
Common Stock	118	118
Common Stock [Member]
Vicor Corporation stockholders' equity:
Common Stock	$ 440	$ 439

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Condensed Consolidated Balance Sheets (Parenthetical)	Jun. 30, 2022 Vote $ / shares shares	Dec. 31, 2021 Vote $ / shares shares
Treasury stock, shares	11,634,806	11,634,806
Class B Common Stock [Member]
Common Stock, votes per share | Vote	10	10
Common Stock, par value | $ / shares	$ 0.01	$ 0.01
Common Stock, shares authorized	14,000,000	14,000,000
Common Stock, shares issued	11,758,218	11,758,218
Common Stock, shares outstanding	11,758,218	11,758,218
Common Stock [Member]
Common Stock, votes per share | Vote	1	1
Common Stock, par value | $ / shares	$ 0.01	$ 0.01
Common Stock, shares authorized	62,000,000	62,000,000
Common Stock, shares issued	43,885,382	43,789,528
Common Stock, shares outstanding	32,220,576	32,154,722

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Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Income Statement [Abstract]
Net revenues		$ 102,186	$ 95,376	$ 190,468	$ 184,172
Cost of revenues		55,337	45,505	106,018	89,601
Gross margin		46,849	49,871	84,450	94,571
Operating expenses:
Selling, general and administrative		20,035	16,589	38,603	33,543
Research and development		15,516	13,273	29,769	26,299
Total operating expenses		35,551	29,862	68,372	59,842
Income from operations		11,298	20,009	16,078	34,729
Other income (expense), net:
Total unrealized gains (losses) on available-for-sale securities, net		16	20	(87)	44
Less: portion of (gains) losses recognized in other comprehensive income		(15)	(19)	89	(42)
Net credit gains recognized in earnings		1	1	2	2
Other income (expense), net		83	372	244	603
Total other income (expense), net		84	373	246	605
Income before income taxes		11,382	20,382	16,324	35,334
Provision for income taxes		802	999	754	856
Consolidated net income		10,580	19,383	15,570	34,478
Less: Net loss attributable to noncontrolling interest		(13)	(11)	(22)	(8)
Net income attributable to Vicor Corporation		$ 10,593	$ 19,394	$ 15,592	$ 34,486
Net income per common share attributable to Vicor Corporation:
Basic		$ 0.24	$ 0.45	$ 0.35	$ 0.79
Diluted		$ 0.24	$ 0.43	$ 0.35	$ 0.77
Shares used to compute net income per common share attributable to Vicor Corporation:
Basic	[1]	43,973	43,553	43,963	43,504
Diluted		44,866	44,841	44,910	44,841

[1] Denominator represents weighted average number of shares of Common Stock and Class B Common Stock outstanding.

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Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Statement of Comprehensive Income [Abstract]
Consolidated net income		$ 10,580	$ 19,383	$ 15,570	$ 34,478
Foreign currency translation losses, net of tax	[1]	(385)	(10)	(579)	(271)
Unrealized losses on available-for-sale securities, net of tax	[1]	(66)	(231)	(382)	(359)
Other comprehensive loss		(451)	(241)	(961)	(630)
Consolidated comprehensive income		10,129	19,142	14,609	33,848
Less: Comprehensive loss attributable to noncontrolling interest		(42)	(12)	(65)	(29)
Comprehensive income attributable to Vicor Corporation		$ 10,171	$ 19,154	$ 14,674	$ 33,877

[1] The deferred tax assets associated with foreign currency translation losses and unrealized losses on available-for-sale securities are completely offset by a tax valuation allowance as of June 30, 2022 and 2021. Therefore, there is no income tax benefit (provision) recognized for the three and six months ended June 30, 2022 and 2021.

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Condensed Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021
Statement of Comprehensive Income [Abstract]
Recognized income tax benefit (provision)	$ 0	$ 0

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Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021
Operating activities:
Consolidated net income	$ 15,570	$ 34,478
Adjustments to reconcile consolidated net income to net cash provided by operating activities:
Depreciation and amortization	6,665	5,618
Stock-based compensation expense	4,616	3,138
Decrease in long-term deferred revenue	(143)	(160)
Decrease in contingent consideration obligations	0	(74)
Gain on disposal of equipment	0	106
Increase in other assets	133	37
Increase in long-term income taxes payable	8	6
Deferred income taxes	(58)	5
Credit gain on available-for-sale securities	(2)	(2)
Change in current assets and liabilities, net	(11,381)	(13,037)
Net cash provided by operating activities	15,408	30,115
Investing activities:
Purchases of short-term investments	0	(50,706)
Sales or maturities of short-term investments	25,000	30,000
Additions to property, plant and equipment	(36,878)	(15,782)
Other	0	(106)
Net cash used for investing activities	(11,878)	(36,594)
Financing activities:
Proceeds from employee stock plans	1,974	4,751
Payment of contingent consideration obligations	0	(107)
Net cash provided by financing activities	1,974	4,644
Effect of foreign exchange rates on cash	(245)	(144)
Net increase (decrease) in cash and cash equivalents	5,259	(1,979)
Cash and cash equivalents at beginning of period	182,418	161,742
Cash and cash equivalents at end of period	$ 187,677	$ 159,763

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Condensed Consolidated Statements of Equity - USD ($) $ in Thousands	Total	Common Stock [Member]	Additional Paid-In Capital [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Treasury Stock [Member]	Total Vicor Corporation Stockholders' Equity [Member]	Noncontrolling Interest [Member]	Class B Common Stock [Member] Common Stock [Member]
Beginning Balance at Dec. 31, 2020	$ 351,155	$ 433	$ 328,392	$ 161,008	$ (204)	$ (138,927)	$ 350,820	$ 335	$ 118
Issuance of Common Stock under employee stock plans	4,751	3	4,748				4,751
Stock-based compensation expense	3,138		3,138				3,138
Components of comprehensive income (loss), net of tax:
Net income (loss)	34,478			34,486			34,486	(8)
Other comprehensive loss	(630)				(609)		(609)	(21)
Total comprehensive income (loss)	33,848						33,877	(29)
Ending Balance at Jun. 30, 2021	392,892	436	336,278	195,494	(813)	(138,927)	392,586	306	118
Beginning Balance at Mar. 31, 2021	370,482	435	333,011	176,100	(573)	(138,927)	370,164	318	118
Issuance of Common Stock under employee stock plans	1,701	1	1,700				1,701
Stock-based compensation expense	1,567		1,567				1,567
Components of comprehensive income (loss), net of tax:
Net income (loss)	19,383			19,394			19,394	(11)
Other comprehensive loss	(241)				(240)		(240)	(1)
Total comprehensive income (loss)	19,142						19,154	(12)
Ending Balance at Jun. 30, 2021	392,892	436	336,278	195,494	(813)	(138,927)	392,586	306	118
Beginning Balance at Dec. 31, 2021	423,905	439	345,664	217,633	(1,328)	(138,927)	423,599	306	118
Issuance of Common Stock under employee stock plans	1,974	1	1,973				1,974
Stock-based compensation expense	4,616		4,616				4,616
Components of comprehensive income (loss), net of tax:
Net income (loss)	15,570			15,592			15,592	(22)
Other comprehensive loss	(961)				(918)		(918)	(43)
Total comprehensive income (loss)	14,609						14,674	(65)
Ending Balance at Jun. 30, 2022	445,104	440	352,253	233,225	(2,246)	(138,927)	444,863	241	118
Beginning Balance at Mar. 31, 2022	432,189	440	349,467	222,632	(1,824)	(138,927)	431,906	283	118
Issuance of Common Stock under employee stock plans	164		164				164
Stock-based compensation expense	2,622		2,622				2,622
Components of comprehensive income (loss), net of tax:
Net income (loss)	10,580			10,593			10,593	(13)
Other comprehensive loss	(451)				(422)		(422)	(29)
Total comprehensive income (loss)	10,129						10,171	(42)
Ending Balance at Jun. 30, 2022	$ 445,104	$ 440	$ 352,253	$ 233,225	$ (2,246)	$ (138,927)	$ 444,863	$ 241	$ 118

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Basis of Presentation

6 Months Ended

Jun. 30, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

1. Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements of Vicor Corporation and its consolidated subsidiaries (collectively, the “Company”) have been prepared in accordance with generally accepted accounting principles for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, these interim financial statements do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.

In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, 2022 are not necessarily indicative of the results that may be expected for any other interim period or the year ending December 31, 2022. The balance sheet at December 31, 2021 presented herein has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. For further information, refer to the consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 filed by the Company with the SEC on March 1, 2022 (“2021 Form 10-K”).

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Inventories

6 Months Ended

Jun. 30, 2022

Inventory Disclosure [Abstract]

Inventories

2. Inventories

Inventories were as follows (in thousands):

	June 30, 2022		December 31, 2021
Raw materials	$	64,978	$	51,289
Work-in-process		12,735		12,514
Finished goods		5,342		3,519
	$	83,055	$	67,322

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Short-Term and Long-Term Investments

6 Months Ended

Jun. 30, 2022

Investments, Debt and Equity Securities [Abstract]

Short-Term and Long-Term Investments

3. Short-Term and Long-Term Investments

As of June 30, 2022 and December 31, 2021, the Company held $19,921,000 and $45,215,000, respectively, of short-term investments, consisting of obligations of the U.S. Treasury, all of which were debt securities with original maturities greater than three months but less than one year at the time of purchase.

As of June 30, 2022 and December 31, 2021, the Company held one auction rate security with a par value of $3,000,000 and an estimated fair value of approximately $2,552,000 and $2,639,000, respectively, purchased through and held in custody by a broker-dealer affiliate of Bank of America, N.A., that has experienced failed auctions (the “Failed Auction Security”) since February 2008. The Failed Auction Security held by the Company is Aaa/AA+ rated by major credit rating agencies, is collateralized by student loans, and is guaranteed by the U.S. Department of Education under the Federal Family Education Loan Program. Management is not aware of any reason to believe the issuer of the Failed Auction Security is presently at risk of default. Through June 30, 2022, the Company has continued to receive interest payments on the Failed Auction Security in accordance with the terms of its indenture. Management believes the Company ultimately should be able to liquidate the Failed Auction Security without significant loss primarily due to the overall quality of the issue held and the collateral securing the substantial majority of the underlying obligation. However, current conditions in the auction rate securities market have led management to conclude the recovery period for the Failed Auction Security exceeds 12 months. As a result, the Company continued to classify the Failed Auction Security as long-term as of June 30, 2022.

Details of our investments are as follows (in thousands):

	June 30, 2022
	Cash and Cash Equivalents		Short-Term Investments		Long-Term Investment
Measured at fair value:
Available-for-sale debt securities:
Money market funds	$	119,736	$	—	$	—
U.S. Treasury Obligations		—		19,921		—
Failed Auction Security		—		—		2,552
Total		119,736		19,921		2,552
Other measurement basis:
Cash on hand		67,941		—		—
Total	$	187,677	$	19,921	$	2,552

	December 31, 2021
	Cash and Cash Equivalents		Short-Term Investments		Long- Term Investment
Measured at fair value:
Available-for-sale debt securities:
Money market funds	$	94,282	$	—	$	—
U.S. Treasury Obligations		—		45,215		—
Failed Auction Security		—		—		2,639
Total		94,282		45,215		2,639
Other measurement basis:
Cash on hand		88,136		—		—
Total	$	182,418	$	45,215	$	2,639

The following is a summary of the available-for-sale securities (in thousands):

June 30, 2022	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
U.S. Treasury Obligations	$	20,083	$	—	$	162	$	19,921
Failed Auction Security		3,000		—		448		2,552

December 31, 2021	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
U.S. Treasury Obligations	$	45,238	$	—	$	23	$	45,215
Failed Auction Security		3,000		—		361		2,639

As of June 30, 2022, the Failed Auction Security had been in an unrealized loss position for greater than 12 months.

The amortized cost and estimated fair value of the available-for-sale securities on June 30, 2022, by type and contractual maturities, are shown below (in thousands):

	Cost		Estimated Fair Value
U.S. Treasury Obligations:
Maturities greater than three months but less than one year	$	20,083	$	19,921

	Cost		Estimated Fair Value
Failed Auction Security:
Due in twenty years	$	3,000	$	2,552

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Fair Value Measurements

6 Months Ended

Jun. 30, 2022

Fair Value Disclosures [Abstract]

Fair Value Measurements

4. Fair Value Measurements

The Company accounts for certain financial assets at fair value, defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions market participants would use in pricing an asset or liability. A three-level hierarchy is used to show the extent and level of judgment used to estimate fair value measurements.

Assets and liabilities measured at fair value on a recurring basis included the following as of June 30, 2022 (in thousands):

	Using
	Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Fair Value as of June 30, 2022
Cash equivalents:
Money market funds	$	119,736	$	—	$	—	$	119,736
Short-term investments:
U.S. Treasury Obligations		19,921		—		—		19,921
Long-term investment:
Failed Auction Security		—		—		2,552		2,552

Assets and liabilities measured at fair value on a recurring basis included the following as of December 31, 2021 (in thousands):

	Using
	Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Fair Value as of December 31, 2021
Cash equivalents:
Money market funds	$	94,282	$	—	$	—	$	94,282
Short-term investments:
U.S. Treasury Obligations		45,215		—		—		45,215
Long-term investment:
Failed Auction Security		—		—		2,639		2,639

The change in the estimated fair value calculated for the investment valued on a recurring basis utilizing Level 3 inputs (i.e., the Failed Auction Security) for the six months ended June 30, 2022 was as follows (in thousands):

Balance at the beginning of the period	$	2,639
Credit gain on available-for-sale security included in Other income (expense), net		2
Loss included in Other comprehensive income		(89	)
Balance at the end of the period	$	2,552

Management utilized a probability weighted discounted cash flow model to determine the estimated fair value as of June 30, 2022.

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Revenues

6 Months Ended

Jun. 30, 2022

Revenue from Contract with Customer [Abstract]

Revenues

5. Revenues

The following tables present the Company’s net revenues disaggregated by geography based on the location of the customer, by product line (in thousands):

	Three Months Ended June 30, 2022
	Brick Products		Advanced Products		Total
United States	$	18,668	$	12,782	$	31,450
Europe		5,041		2,229		7,270
Asia Pacific		9,846		52,550		62,396
All other		968		102		1,070
	$	34,523	$	67,663	$	102,186

	Six Months Ended June 30, 2022
	Brick Products		Advanced Products		Total
United States	$	32,729	$	23,408	$	56,137
Europe		12,083		4,997		17,080
Asia Pacific		23,367		92,045		115,412
All other		1,701		138		1,839
	$	69,880	$	120,588	$	190,468

	Three Months Ended June 30, 2021
	Brick Products		Advanced Products		Total
United States	$	19,708	$	14,356	$	34,064
Europe		10,224		1,285		11,509
Asia Pacific		24,045		25,339		49,384
All other		375		44		419
	$	54,352	$	41,024	$	95,376

	Six Months Ended June 30, 2021
	Brick Products		Advanced Products		Total
United States	$	38,291	$	22,905	$	61,196
Europe		18,420		2,280		20,700
Asia Pacific		51,373		49,992		101,365
All other		727		184		911
	$	108,811	$	75,361	$	184,172

The following tables present the Company’s net revenues disaggregated by the category of revenue, by product line (in thousands):

	Three Months Ended June 30, 2022
	Brick Products		Advanced Products		Total
Direct customers, contract manufacturers and non-stocking distributors	$	23,566	$	61,979	$	85,545
Stocking distributors, net of sales allowances		10,908		3,102		14,010
Non-recurring engineering		49		1,908		1,957
Royalties		—		656		656
Other		—		18		18
	$	34,523	$	67,663	$	102,186

	Six Months Ended June 30, 2022
	Brick Products		Advanced Products		Total
Direct customers, contract manufacturers and non-stocking distributors	$	47,967	$	109,450	$	157,417
Stocking distributors, net of sales allowances		21,672		6,846		28,518
Non-recurring engineering		241		3,294		3,535
Royalties		—		962		962
Other		—		36		36
	$	69,880	$	120,588	$	190,468

	Three Months Ended June 30, 2021
	Brick Products		Advanced Products		Total
Direct customers, contract manufacturers and non-stocking distributors	$	37,614	$	32,644	$	70,258
Stocking distributors, net of sales allowances		16,634		4,634		21,268
Non-recurring engineering		104		3,726		3,830
Royalties		—		3		3
Other		—		17		17
	$	54,352	$	41,024	$	95,376

	Six Months Ended June 30, 2021
	Brick Products		Advanced Products		Total
Direct customers, contract manufacturers and non-stocking distributors	$	81,422	$	61,701	$	143,123
Stocking distributors, net of sales allowances		27,181		8,772		35,953
Non-recurring engineering		208		4,797		5,005
Royalties		—		56		56
Other		—		35		35
	$	108,811	$	75,361	$	184,172

The following table presents the changes in certain contract assets and (liabilities) (in thousands):

	June 30, 2022			December 31, 2021			Change
Short-term deferred revenue and customer prepayments	$	(7,702	)	$	(7,912	)	$	210
Long-term deferred revenue		(270	)		(413	)		143
Deferred expenses		559			560			(1	)
Sales allowances		(1,006	)		(1,464	)		458

Deferred expenses are included in Other current assets in the accompanying Condensed Consolidated Balance Sheets.

The Company records deferred revenue, which represents a contract liability, when cash payments are received or due in advance of performance under a contract with a customer. The Company recognized revenue of approximately $1,136,000 and $931,000 for the three and six months ended June 30, 2022, respectively, and $2,410,000 and $3,081,000 for the three and six months ended June 30, 2021, respectively, that was included in deferred revenue at the beginning of each respective period.

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Stock-Based Compensation

6 Months Ended

Jun. 30, 2022

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Compensation

6. Stock-Based Compensation

The Company uses the Black-Scholes option pricing model to calculate the fair value of stock option awards, whether they possess time-based vesting provisions or performance-based vesting provisions, and awards granted under the Vicor Corporation 2017 Employee Stock Purchase Plan (“ESPP”), as of their grant date. Stock-based compensation expense was as follows (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Cost of revenues	$	431	$	252	$	682	$	480
Selling, general and administrative		1,440		779		2,647		1,632
Research and development		751		536		1,287		1,026
Total stock-based compensation	$	2,622	$	1,567	$	4,616	$	3,138

Compensation expense by type of award was as follows (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Stock options	$	2,351	$	1,336	$	4,110	$	2,667
ESPP		271		231		506		471
Total stock-based compensation	$	2,622	$	1,567	$	4,616	$	3,138

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Rental Income

6 Months Ended

Jun. 30, 2022

Leases [Abstract]

Rental Income

7. Rental Income

Income, net under the Company’s operating lease agreement, for its owned facility leased to a third party in California, was approximately $198,000 and $396,000 for both the three and six months ended June 30, 2022 and 2021, respectively.

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Income Taxes

6 Months Ended

Jun. 30, 2022

Income Tax Disclosure [Abstract]

Income Taxes

8. Income Taxes

The provision for income taxes is based on the estimated annual effective tax rate for the year, which includes estimated federal, state and foreign income taxes on the Company’s projected pre-tax income.

The provision for income taxes and the effective income tax rates were as follows (dollars in thousands):

	Three Months Ended June 30,						Six Months Ended June 30,
	2022			2021			2022			2021
Provision for income taxes	$	802		$	999		$	754		$	856
Effective income tax rate		7.0	%		4.9	%		4.6	%		2.4	%

The effective tax rates were lower than the statutory tax rates for the three and six months ended June 30, 2022 and 2021 primarily due to the Company’s full valuation allowance position against domestic deferred tax assets. The provision for income taxes for the three and six months ended June 30, 2022 and 2021 included estimated federal, state and foreign income taxes in jurisdictions in which the Company does not have sufficient tax attributes, offset by excess tax benefits related to stock based compensation during those periods.

As of June 30, 2022, the Company has a valuation allowance of approximately $43,329,000 against all net domestic deferred tax assets, for which realization cannot be considered more likely than not at this time. Management assesses the need for the valuation allowance on a quarterly basis. In assessing the need for a valuation allowance, the Company considers all positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies, and past financial performance. Despite recent positive operating results, the Company is in a cumulative loss position as of June 30, 2022, primarily due to tax deductions on 2020 and 2021 exercises of stock-based compensation. The Company faces uncertainties in forecasting its operating results due to supply and factory capacity constraints, certain process issues with the production of Advanced Products and the unpredictability in certain markets. This operating uncertainty also makes it difficult to predict the availability and utilization of tax benefits over the next several years. As a result, management has concluded, as of June 30, 2022, it is more likely than not the Company’s net domestic deferred tax assets will not be realized, and a full valuation allowance against all net domestic deferred tax assets is still warranted as of June 30, 2022. The valuation allowance against these deferred tax assets may require adjustment in the future based on changes in the mix of temporary differences, changes in tax laws, and operating performance. If the positive operating results continue, and the Company’s concerns about industry uncertainty and world events, supply and factory capacity constraints, and process issues with the production of Advanced Products are resolved, and the amount of tax benefits the Company is able to utilize to the point that the Company believes future taxable income can be more reliably forecasted, the Company may release all or a portion of the valuation allowance in the near-term. If and when the Company determines the valuation allowance should be released (i.e., reduced), the adjustment would result in a tax benefit reported in that period’s Consolidated Statements of Operations, the effect of which would be an increase in reported net income.

The Company was informed in September 2021 by the Internal Revenue Service of their intention to examine the Company’s 2019 Federal income tax return. There are no other audits or examinations in process in any other jurisdiction.

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Net Income per Share

6 Months Ended

Jun. 30, 2022

Earnings Per Share [Abstract]

Net Income per Share

9. Net Income per Share

The following table sets forth the computation of basic and diluted net income per share (in thousands, except per share amounts):

	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Numerator:
Net income attributable to Vicor Corporation	$	10,593	$	19,394	$	15,592	$	34,486
Denominator:
Denominator for basic net income per share-weighted average shares (1)		43,973		43,553		43,963		43,504
Effect of dilutive securities:
Employee stock options (2)		893		1,288		947		1,337
Denominator for diluted net income per share – adjusted weighted-average shares and assumed conversions		44,866		44,841		44,910		44,841
Basic net income per share	$	0.24	$	0.45	$	0.35	$	0.79
Diluted net income per share	$	0.24	$	0.43	$	0.35	$	0.77

(1) Denominator represents weighted average number of shares of Common Stock and Class B Common Stock outstanding.

(2) Options to purchase 898,640 and 658,014 shares of Common Stock for the three and six months ended June 30, 2022, respectively, and options to purchase 138,125 and 90,339 shares of Common Stock for the three and six months ended June 30, 2021, respectively, were not included in the calculations of net income per share as the effect would have been antidilutive.

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2022

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

10. Commitments and Contingencies

At June 30, 2022, the Company had approximately $32,034,000 of cancelable and non-cancelable capital expenditure commitments, principally for manufacturing equipment, and approximately $10,640,000 of capital expenditure items which had been received and included in Property, plant and equipment in the accompanying Condensed Consolidated Balance Sheets, but not yet paid for.

The Company is the defendant in a patent infringement lawsuit originally filed on January 28, 2011 by SynQor, Inc. (“SynQor”) in the U.S. District Court (the “District Court”) for the Eastern District of Texas (the “Texas Action”). The complaint, as amended, alleges that the Company’s products, including but not limited to, unregulated bus converters used in intermediate bus architecture power supply systems, infringe SynQor’s U.S. patent numbers 7,072,190, 7,272,021, 7,564,702, and 8,023,290 (“the ‘190 patent”, “the ‘021 patent”, “the ‘702 patent”, and “the ‘290 patent”, respectively). SynQor’s complaint seeks an injunction against further infringement and an award of unspecified compensatory and enhanced damages, interest, costs and attorney fees. However, because each of the asserted SynQor patents has expired, an injunction is no longer available as relief should SynQor prevail in the Texas Action. The Company has denied that its products infringe any of the SynQor patents, and has asserted that the SynQor patents are invalid and/or unenforceable. The Company has also asserted counterclaims seeking damages from SynQor for deceptive trade practices and tortious interference with prospective economic advantage arising from SynQor’s attempted enforcement of its patents against the Company.

On November 24, 2015, the District Court ordered the Texas Action stayed pending completion of certain inter partes reexamination (“IPRx”) proceedings initiated by the Company at the United States Patent and Trademark Office (“USPTO”). In these IPRx proceedings, the Company challenged the validity of the SynQor patent claims asserted in the Texas Action. On November 16, 2021, the District Court issued an order lifting the stay. At a hearing on February 2, 2022, the District Court issued an order denying all pending summary judgment and other pre-trial motions without prejudice. The District Court further authorized the Company to file new motions for summary judgment, to be considered on an expedited schedule. The Company filed a motion for summary judgment of non-infringement on February 4, 2022. On May 25, 2022, a magistrate judge issued a report and recommendation recommending that the Company’s motion be denied. On June 8, 2022, the Company filed objections to that report and recommendation. The District Court has not yet ruled on those objections.    

On March 1, 2022, the Company also filed a motion for involuntary dismissal of the ‘290 patent from the case. On May 25, 2022, a magistrate judge issued a report and recommendation recommending that the Company’s motion be granted. On June 8, 2022, SynQor filed objections to that report and recommendation. The District Court has not yet ruled on those objections. On April 5, 2022, the Court entered a scheduling order setting a trial date of October 17, 2022.

The current status of the IPRx proceedings and related appeals is as follows:

• ‘190 patent: Certain claims of the ‘190 patent were found unpatentable by the United States Court of Appeals for the Federal Circuit (“Federal Circuit”) in a decision issued on March 13, 2015. The court remanded the remaining claims to the USPTO for further consideration. On February 20, 2019, the Patent Trial and Appeal Board (“PTAB”) of the USPTO issued a decision finding that all of the remaining challenged claims were unpatentable. SynQor appealed that decision. On February 22, 2021, the Federal Circuit issued a decision in that appeal. In a 2-1 ruling, the Federal Circuit vacated and remanded the PTAB’s decision, finding that the reasoning the PTAB had relied on in reaching its decision was precluded by certain prior PTAB rulings regarding the ‘290 and ‘702 patents and remanded the case to the PTAB for further proceedings. On April 7, 2021, the Company filed a petition for panel rehearing and rehearing en banc of the Federal Circuit’s February 22, 2021 decision. The Federal Circuit denied that petition on June 7, 2021. Accordingly, the matter was then remanded to the PTAB for further proceedings. On January 31, 2022, the PTAB issued a decision that reaffirmed the unpatentability of the claims of the ‘190 patent that had been found unpatentable by the Federal Circuit in its March 13, 2015 decision, and otherwise upheld the patentability of the remaining challenged claims of the ‘190 patent. On March 30, 2022, the Company filed an appeal of this decision to the Federal Circuit, where it remains pending.

• ‘021 patent: On August 30, 2017, the Federal Circuit issued a final decision upholding a PTAB decision finding all of the asserted claims of the ‘021 patent unpatentable. In addition, SynQor attempted to amend the ‘021 patent to add new claims during the IPRx. Those claims were rejected by the PTAB. SynQor subsequently filed an appeal with the Federal Circuit seeking to vacate that rejection as moot, in view of the expiry of the term of the ‘021 patent. On June 17, 2022, the Federal Circuit issued a decision vacating the PTAB’s rejection as moot.

• ‘702 patent: On August 30, 2017, the Federal Circuit issued a final decision upholding a PTAB decision finding all of the asserted claims of the ‘702 patent to be patentable.

• ‘290 patent: On June 16, 2021, the PTAB issued a decision finding all of the claims of the ‘290 patent unpatentable. SynQor has filed an appeal of that decision to the Federal Circuit, where it remains pending.

On January 23, 2018, the 20-year terms of the ‘190 patent, the ‘021 patent, the ‘702 patent and the ‘290 patent expired. As a consequence of these expirations, the Company cannot be liable under any of the SynQor patents for allegedly infringing activities occurring after that date. In addition, any amended claims that may issue as a result of any of the still-pending IPRx proceedings will have no effective term and cannot be the basis for any liability by the Company. As noted above, the IPRx proceedings relating to the asserted claims of the ‘190 and ‘290 patents remain pending before the PTAB or on appeal at the Federal Circuit.

The Company continues to believe none of its products, including its unregulated bus converters, infringe any valid claim of the asserted SynQor patents, either alone or when used in an intermediate bus architecture implementation. The Company believes SynQor’s claims lack merit and, therefore, it continues to vigorously defend itself against SynQor’s patent infringement allegations. The Company does not believe a loss is probable for this matter. If a loss were to be incurred, however, the Company cannot estimate the amount of possible loss or range of possible loss at this time.

In addition to the SynQor matter, the Company is involved in certain other litigation and claims incidental to the conduct of its business. While the outcome of lawsuits and claims against the Company cannot be predicted with certainty, management does not expect any current litigation or claims will have a material adverse impact on the Company’s financial position or results of operations.

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Impact of Recently Issued Accounting Standards

6 Months Ended

Jun. 30, 2022

Accounting Changes and Error Corrections [Abstract]

Impact of Recently Issued Accounting Standards

11. Impact of Recently Issued Accounting Standards

New pronouncements issued but not effective until after June 30, 2022 are not expected to have a material impact on the Company’s consolidated financial statements.

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Inventories (Tables)

6 Months Ended

Jun. 30, 2022

Inventory Disclosure [Abstract]

Summary of Inventories

Inventories were as follows (in thousands):

	June 30, 2022		December 31, 2021
Raw materials	$	64,978	$	51,289
Work-in-process		12,735		12,514
Finished goods		5,342		3,519
	$	83,055	$	67,322

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Short-Term and Long-Term Investments (Tables)

6 Months Ended

Jun. 30, 2022

Investments, Debt and Equity Securities [Abstract]

Summary of Investment

Details of our investments are as follows (in thousands):

	June 30, 2022
	Cash and Cash Equivalents		Short-Term Investments		Long-Term Investment
Measured at fair value:
Available-for-sale debt securities:
Money market funds	$	119,736	$	—	$	—
U.S. Treasury Obligations		—		19,921		—
Failed Auction Security		—		—		2,552
Total		119,736		19,921		2,552
Other measurement basis:
Cash on hand		67,941		—		—
Total	$	187,677	$	19,921	$	2,552

	December 31, 2021
	Cash and Cash Equivalents		Short-Term Investments		Long- Term Investment
Measured at fair value:
Available-for-sale debt securities:
Money market funds	$	94,282	$	—	$	—
U.S. Treasury Obligations		—		45,215		—
Failed Auction Security		—		—		2,639
Total		94,282		45,215		2,639
Other measurement basis:
Cash on hand		88,136		—		—
Total	$	182,418	$	45,215	$	2,639

Summary of Available-for-Sale Securities

The following is a summary of the available-for-sale securities (in thousands):

June 30, 2022	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
U.S. Treasury Obligations	$	20,083	$	—	$	162	$	19,921
Failed Auction Security		3,000		—		448		2,552

December 31, 2021	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
U.S. Treasury Obligations	$	45,238	$	—	$	23	$	45,215
Failed Auction Security		3,000		—		361		2,639

Cost and Estimated Fair Value of Failed Auction Security by Contractual Maturities

The amortized cost and estimated fair value of the available-for-sale securities on June 30, 2022, by type and contractual maturities, are shown below (in thousands):

	Cost		Estimated Fair Value
U.S. Treasury Obligations:
Maturities greater than three months but less than one year	$	20,083	$	19,921

	Cost		Estimated Fair Value
Failed Auction Security:
Due in twenty years	$	3,000	$	2,552

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Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2022

Fair Value Disclosures [Abstract]

Assets and Liabilities Measured at Fair Value on Recurring Basis

Assets and liabilities measured at fair value on a recurring basis included the following as of June 30, 2022 (in thousands):

	Using
	Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Fair Value as of June 30, 2022
Cash equivalents:
Money market funds	$	119,736	$	—	$	—	$	119,736
Short-term investments:
U.S. Treasury Obligations		19,921		—		—		19,921
Long-term investment:
Failed Auction Security		—		—		2,552		2,552

Assets and liabilities measured at fair value on a recurring basis included the following as of December 31, 2021 (in thousands):

	Using
	Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Fair Value as of December 31, 2021
Cash equivalents:
Money market funds	$	94,282	$	—	$	—	$	94,282
Short-term investments:
U.S. Treasury Obligations		45,215		—		—		45,215
Long-term investment:
Failed Auction Security		—		—		2,639		2,639

Change in Estimated Fair Values Calculated for Investment Valued on Recurring Basis Utilizing Level 3 Inputs

The change in the estimated fair value calculated for the investment valued on a recurring basis utilizing Level 3 inputs (i.e., the Failed Auction Security) for the six months ended June 30, 2022 was as follows (in thousands):

Balance at the beginning of the period	$	2,639
Credit gain on available-for-sale security included in Other income (expense), net		2
Loss included in Other comprehensive income		(89	)
Balance at the end of the period	$	2,552

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Revenues (Tables)

6 Months Ended

Jun. 30, 2022

Summary of Net Revenues Based On Geography Location

The following tables present the Company’s net revenues disaggregated by geography based on the location of the customer, by product line (in thousands):

	Three Months Ended June 30, 2022
	Brick Products		Advanced Products		Total
United States	$	18,668	$	12,782	$	31,450
Europe		5,041		2,229		7,270
Asia Pacific		9,846		52,550		62,396
All other		968		102		1,070
	$	34,523	$	67,663	$	102,186

	Six Months Ended June 30, 2022
	Brick Products		Advanced Products		Total
United States	$	32,729	$	23,408	$	56,137
Europe		12,083		4,997		17,080
Asia Pacific		23,367		92,045		115,412
All other		1,701		138		1,839
	$	69,880	$	120,588	$	190,468

	Three Months Ended June 30, 2021
	Brick Products		Advanced Products		Total
United States	$	19,708	$	14,356	$	34,064
Europe		10,224		1,285		11,509
Asia Pacific		24,045		25,339		49,384
All other		375		44		419
	$	54,352	$	41,024	$	95,376

	Six Months Ended June 30, 2021
	Brick Products		Advanced Products		Total
United States	$	38,291	$	22,905	$	61,196
Europe		18,420		2,280		20,700
Asia Pacific		51,373		49,992		101,365
All other		727		184		911
	$	108,811	$	75,361	$	184,172

Summary of Net Revenues Disaggregated by Geography

The following tables present the Company’s net revenues disaggregated by the category of revenue, by product line (in thousands):

	Three Months Ended June 30, 2022
	Brick Products		Advanced Products		Total
Direct customers, contract manufacturers and non-stocking distributors	$	23,566	$	61,979	$	85,545
Stocking distributors, net of sales allowances		10,908		3,102		14,010
Non-recurring engineering		49		1,908		1,957
Royalties		—		656		656
Other		—		18		18
	$	34,523	$	67,663	$	102,186

	Six Months Ended June 30, 2022
	Brick Products		Advanced Products		Total
Direct customers, contract manufacturers and non-stocking distributors	$	47,967	$	109,450	$	157,417
Stocking distributors, net of sales allowances		21,672		6,846		28,518
Non-recurring engineering		241		3,294		3,535
Royalties		—		962		962
Other		—		36		36
	$	69,880	$	120,588	$	190,468

	Three Months Ended June 30, 2021
	Brick Products		Advanced Products		Total
Direct customers, contract manufacturers and non-stocking distributors	$	37,614	$	32,644	$	70,258
Stocking distributors, net of sales allowances		16,634		4,634		21,268
Non-recurring engineering		104		3,726		3,830
Royalties		—		3		3
Other		—		17		17
	$	54,352	$	41,024	$	95,376

	Six Months Ended June 30, 2021
	Brick Products		Advanced Products		Total
Direct customers, contract manufacturers and non-stocking distributors	$	81,422	$	61,701	$	143,123
Stocking distributors, net of sales allowances		27,181		8,772		35,953
Non-recurring engineering		208		4,797		5,005
Royalties		—		56		56
Other		—		35		35
	$	108,811	$	75,361	$	184,172

Summary of Changes in Contract Assets And Liabilities

The following table presents the changes in certain contract assets and (liabilities) (in thousands):

	June 30, 2022			December 31, 2021			Change
Short-term deferred revenue and customer prepayments	$	(7,702	)	$	(7,912	)	$	210
Long-term deferred revenue		(270	)		(413	)		143
Deferred expenses		559			560			(1	)
Sales allowances		(1,006	)		(1,464	)		458

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Stock-Based Compensation (Tables)

6 Months Ended

Jun. 30, 2022

Stock-Based Compensation Expense

Stock-based compensation expense was as follows (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Cost of revenues	$	431	$	252	$	682	$	480
Selling, general and administrative		1,440		779		2,647		1,632
Research and development		751		536		1,287		1,026
Total stock-based compensation	$	2,622	$	1,567	$	4,616	$	3,138

Summary of Compensation Expense by Type of Award

Compensation expense by type of award was as follows (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Stock options	$	2,351	$	1,336	$	4,110	$	2,667
ESPP		271		231		506		471
Total stock-based compensation	$	2,622	$	1,567	$	4,616	$	3,138

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Income Taxes (Tables)

6 Months Ended

Jun. 30, 2022

Income Tax Disclosure [Abstract]

Provision for Income Taxes and Effective Income Tax Rates

The provision for income taxes and the effective income tax rates were as follows (dollars in thousands):

	Three Months Ended June 30,						Six Months Ended June 30,
	2022			2021			2022			2021
Provision for income taxes	$	802		$	999		$	754		$	856
Effective income tax rate		7.0	%		4.9	%		4.6	%		2.4	%

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Net Income per Share (Tables)

6 Months Ended

Jun. 30, 2022

Earnings Per Share [Abstract]

Computation of Basic and Diluted Net Income Per Share

The following table sets forth the computation of basic and diluted net income per share (in thousands, except per share amounts):

	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Numerator:
Net income attributable to Vicor Corporation	$	10,593	$	19,394	$	15,592	$	34,486
Denominator:
Denominator for basic net income per share-weighted average shares (1)		43,973		43,553		43,963		43,504
Effect of dilutive securities:
Employee stock options (2)		893		1,288		947		1,337
Denominator for diluted net income per share – adjusted weighted-average shares and assumed conversions		44,866		44,841		44,910		44,841
Basic net income per share	$	0.24	$	0.45	$	0.35	$	0.79
Diluted net income per share	$	0.24	$	0.43	$	0.35	$	0.77

(1) Denominator represents weighted average number of shares of Common Stock and Class B Common Stock outstanding.

(2) Options to purchase 898,640 and 658,014 shares of Common Stock for the three and six months ended June 30, 2022, respectively, and options to purchase 138,125 and 90,339 shares of Common Stock for the three and six months ended June 30, 2021, respectively, were not included in the calculations of net income per share as the effect would have been antidilutive.

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Inventories - Summary of Inventories (Detail) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Inventory Disclosure [Abstract]
Raw materials	$ 64,978	$ 51,289
Work-in-process	12,735	12,514
Finished goods	5,342	3,519
Net balance	$ 83,055	$ 67,322

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Short-Term and Long-Term Investments - Additional Information (Detail) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2022	Dec. 31, 2021
Unrealized Losses On Short Term And Long Term Investments [Line Items]
Short Term Investments	$ 19,921	$ 45,215
Minimum period for which failed auction securities been in unrealized loss position	12 months
Failed Auction Security [Member]
Unrealized Losses On Short Term And Long Term Investments [Line Items]
Amortized cost of securities	$ 3,000	3,000
Period for which failed auction securities been in unrealized loss position	exceeds 12 months
Estimated Fair Value	$ 2,552	$ 2,639

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Short-Term and Long-Term Investments - Summary of Investment (Detail) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Cash and Cash Equivalents [Member]
Schedule of Available-for-sale Securities [Line Items]
Debt Securities, Available-for-sale	$ 187,677	$ 182,418
Short-term Investments [Member]
Schedule of Available-for-sale Securities [Line Items]
Debt Securities, Available-for-sale	19,921	45,215
Other Long-term Investment [Member]
Schedule of Available-for-sale Securities [Line Items]
Debt Securities, Available-for-sale	2,552	2,639
Auction Rate Securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Debt Securities, Available-for-sale	2,552	2,639
Auction Rate Securities [Member] | Other Long-term Investment [Member]
Schedule of Available-for-sale Securities [Line Items]
Debt Securities, Available-for-sale	2,552	2,639
Estimate of Fair Value Measurement [Member] | Cash and Cash Equivalents [Member]
Schedule of Available-for-sale Securities [Line Items]
Debt Securities, Available-for-sale	119,736	94,282
Estimate of Fair Value Measurement [Member] | Short-term Investments [Member]
Schedule of Available-for-sale Securities [Line Items]
Debt Securities, Available-for-sale	19,921	45,215
Estimate of Fair Value Measurement [Member] | Other Long-term Investment [Member]
Schedule of Available-for-sale Securities [Line Items]
Debt Securities, Available-for-sale	2,552	2,639
Estimate of Fair Value Measurement [Member] | Auction Rate Securities [Member] | Other Long-term Investment [Member]
Schedule of Available-for-sale Securities [Line Items]
Debt Securities, Available-for-sale	2,552	2,639
Estimate of Fair Value Measurement [Member] | Money Market Funds [Member] | Cash and Cash Equivalents [Member]
Schedule of Available-for-sale Securities [Line Items]
Debt Securities, Available-for-sale	119,736	94,282
Estimate of Fair Value Measurement [Member] | US Treasury Obligations [Member] | Short-term Investments [Member]
Schedule of Available-for-sale Securities [Line Items]
Debt Securities, Available-for-sale	19,921	45,215
Portion at Other than Fair Value Measurement [Member] | Cash [Member] | Cash and Cash Equivalents [Member]
Schedule of Available-for-sale Securities [Line Items]
Debt Securities, Available-for-sale	$ 67,941	$ 88,136

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Short-Term and Long-Term Investments - Summary of Available-for-Sale Securities (Detail) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
US Treasury Obligations [Member]
Debt Securities, Available-for-sale [Line Items]
Cost	$ 20,083	$ 45,238
Gross Unrealized Gains	0	0
Gross Unrealized Losses	162	23
Estimated Fair Value	19,921	45,215
Failed Auction Security [Member]
Debt Securities, Available-for-sale [Line Items]
Cost	3,000	3,000
Gross Unrealized Losses	448	361
Estimated Fair Value	$ 2,552	$ 2,639

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Short-Term and Long-Term Investments - Amortized Cost and Estimated Fair Value of Available-for-Sale Securities by Contractual Maturities (Detail) $ in Thousands	Jun. 30, 2022 USD ($)
Failed Auction Security [Member]
Schedule of Available-for-sale Securities [Line Items]
Due in twenty years, Cost	$ 3,000
Due in twenty years, Estimated Fair Value	2,552
US Treasury Obligations [Member]
Schedule of Available-for-sale Securities [Line Items]
Maturities greater than three months but less than one year, Cost	20,083
Maturities greater than three months but less than one year, Estimated Fair Value	$ 19,921

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Fair Value Measurements - Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Short-term Investments [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Estimated Fair Value	$ 19,921	$ 45,215
Other Long-term Investments [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Estimated Fair Value	2,552	2,639
Failed Auction Security [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Estimated Fair Value	2,552	2,639
Failed Auction Security [Member] | Other Long-term Investments [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Estimated Fair Value	2,552	2,639
US Treasury Obligations [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Estimated Fair Value	19,921	45,215
US Treasury Obligations [Member] | Short-term Investments [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Cash equivalents	19,921	45,215
Money Market Funds [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Cash equivalents	119,736	94,282
Recurring [Member] | Quoted Prices in Active Markets (Level 1) [Member] | US Treasury Obligations [Member] | Short-term Investments [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Cash equivalents	19,921	45,215
Recurring [Member] | Quoted Prices in Active Markets (Level 1) [Member] | Money Market Funds [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Cash equivalents	119,736	94,282
Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | Failed Auction Security [Member] | Other Long-term Investments [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Estimated Fair Value	$ 2,552	$ 2,639

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Fair Value Measurements - Change in Estimated Fair Values Calculated for Investment Valued on Recurring Basis Utilizing Level 3 Inputs (Detail) $ in Thousands	6 Months Ended
	Jun. 30, 2022 USD ($)
Fair Value Disclosures [Abstract]
Balance at the beginning of the period	$ 2,639
Credit gain on available-for-sale security included in Other income (expense), net	2
Loss included in Other comprehensive income	(89)
Balance at the end of the period	$ 2,552

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Revenues - Summary of Net Revenues Disaggregated by Geography (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Disaggregation of Revenue [Line Items]
Revenue	$ 102,186	$ 95,376	$ 190,468	$ 184,172
Brick Products [Member]
Disaggregation of Revenue [Line Items]
Revenue	34,523	54,352	69,880	108,811
Advanced Products [Member]
Disaggregation of Revenue [Line Items]
Revenue	67,663	41,024	120,588	75,361
United States [Member]
Disaggregation of Revenue [Line Items]
Revenue	31,450	34,064	56,137	61,196
United States [Member] | Brick Products [Member]
Disaggregation of Revenue [Line Items]
Revenue	18,668	19,708	32,729	38,291
United States [Member] | Advanced Products [Member]
Disaggregation of Revenue [Line Items]
Revenue	12,782	14,356	23,408	22,905
Europe [Member]
Disaggregation of Revenue [Line Items]
Revenue	7,270	11,509	17,080	20,700
Europe [Member] | Brick Products [Member]
Disaggregation of Revenue [Line Items]
Revenue	5,041	10,224	12,083	18,420
Europe [Member] | Advanced Products [Member]
Disaggregation of Revenue [Line Items]
Revenue	2,229	1,285	4,997	2,280
Asia Pacific [Member]
Disaggregation of Revenue [Line Items]
Revenue	62,396	49,384	115,412	101,365
Asia Pacific [Member] | Brick Products [Member]
Disaggregation of Revenue [Line Items]
Revenue	9,846	24,045	23,367	51,373
Asia Pacific [Member] | Advanced Products [Member]
Disaggregation of Revenue [Line Items]
Revenue	52,550	25,339	92,045	49,992
All Other [Member]
Disaggregation of Revenue [Line Items]
Revenue	1,070	419	1,839	911
All Other [Member] | Brick Products [Member]
Disaggregation of Revenue [Line Items]
Revenue	968	375	1,701	727
All Other [Member] | Advanced Products [Member]
Disaggregation of Revenue [Line Items]
Revenue	$ 102	$ 44	$ 138	$ 184

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Revenues - Summary of Net Revenues Disaggregated by Category (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Disaggregation of Revenue [Line Items]
Revenue	$ 102,186	$ 95,376	$ 190,468	$ 184,172
Brick Products [Member]
Disaggregation of Revenue [Line Items]
Revenue	34,523	54,352	69,880	108,811
Advanced Products [Member]
Disaggregation of Revenue [Line Items]
Revenue	67,663	41,024	120,588	75,361
Direct Customers, Contract Manufacturers and Non-stocking Distributors [Member]
Disaggregation of Revenue [Line Items]
Revenue	85,545	70,258	157,417	143,123
Direct Customers, Contract Manufacturers and Non-stocking Distributors [Member] | Brick Products [Member]
Disaggregation of Revenue [Line Items]
Revenue	23,566	37,614	47,967	81,422
Direct Customers, Contract Manufacturers and Non-stocking Distributors [Member] | Advanced Products [Member]
Disaggregation of Revenue [Line Items]
Revenue	61,979	32,644	109,450	61,701
Stocking Distributors, Net of Sales Allowances [Member]
Disaggregation of Revenue [Line Items]
Revenue	14,010	21,268	28,518	35,953
Stocking Distributors, Net of Sales Allowances [Member] | Brick Products [Member]
Disaggregation of Revenue [Line Items]
Revenue	10,908	16,634	21,672	27,181
Stocking Distributors, Net of Sales Allowances [Member] | Advanced Products [Member]
Disaggregation of Revenue [Line Items]
Revenue	3,102	4,634	6,846	8,772
Non-recurring Engineering [Member]
Disaggregation of Revenue [Line Items]
Revenue	1,957	3,830	3,535	5,005
Non-recurring Engineering [Member] | Brick Products [Member]
Disaggregation of Revenue [Line Items]
Revenue	49	104	241	208
Non-recurring Engineering [Member] | Advanced Products [Member]
Disaggregation of Revenue [Line Items]
Revenue	1,908	3,726	3,294	4,797
Royalties [Member]
Disaggregation of Revenue [Line Items]
Revenue	656	3	962	56
Royalties [Member] | Advanced Products [Member]
Disaggregation of Revenue [Line Items]
Revenue	656	3	962	56
Other [Member]
Disaggregation of Revenue [Line Items]
Revenue	18	17	36	35
Other [Member] | Advanced Products [Member]
Disaggregation of Revenue [Line Items]
Revenue	$ 18	$ 17	$ 36	$ 35

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Revenues - Summary of Changes in Certain Contract Assets and Liabilities (Detail) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Disaggregation of Revenue [Line Items]
Short-term deferred revenue and customer prepayments	$ (7,702)	$ (7,912)
Long-term deferred revenue	(270)	(413)
Deferred expenses	559	560
Sales allowances	(1,006)	$ (1,464)
Accounting Standards Update 2014-09 [Member]
Disaggregation of Revenue [Line Items]
Short-term deferred revenue and customer prepayments	210
Long-term deferred revenue	143
Deferred expenses	(1)
Sales allowances	$ 458

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Revenues - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Deferred Revenue, Revenue Recognized	$ 1,136,000	$ 2,410,000	$ 931,000	$ 3,081,000

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Stock-Based Compensation - Stock-Based Compensation Expense (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation	$ 2,622	$ 1,567	$ 4,616	$ 3,138
Cost of Revenues [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation	431	252	682	480
Selling, General and Administrative [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation	1,440	779	2,647	1,632
Research and Development [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation	$ 751	$ 536	$ 1,287	$ 1,026

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Stock-Based Compensation - Summary of Compensation Expense by Type of Award (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation	$ 2,622	$ 1,567	$ 4,616	$ 3,138
Stock Options [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation	2,351	1,336	4,110	2,667
ESPP [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation	$ 271	$ 231	$ 506	$ 471

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Rental Income - Additional information (Detail) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Leases [Abstract]
Lease income	$ 198,000	$ 396,000	$ 198,000	$ 396,000

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Income Taxes - Additional Information (Detail)	Jun. 30, 2022 USD ($)
Income Tax Disclosure [Line Items]
Valuation allowance, deferred tax assets	$ 43,329,000

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Income Taxes - Provision for Income Taxes and Effective Income Tax Rates (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Income Tax Disclosure [Abstract]
Provision for income taxes	$ 802	$ 999	$ 754	$ 856
Effective income tax rate	7.00%	4.90%	4.60%	2.40%

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Net Income per Share - Computation of Basic and Diluted Net Income Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands		3 Months Ended		6 Months Ended
		Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Numerator:
Net income (loss) attributable to Vicor Corporation		$ 10,593	$ 19,394	$ 15,592	$ 34,486
Denominator:
Denominator for basic net income per share-weighted average shares	[1]	43,973	43,553	43,963	43,504
Effect of dilutive securities:
Employee stock options	[2]	893	1,288	947	1,337
Denominator for diluted net income per share – adjusted weighted-average shares and assumed conversions		44,866	44,841	44,910	44,841
Basic net income (loss) per share		$ 0.24	$ 0.45	$ 0.35	$ 0.79
Diluted net income (loss) per share		$ 0.24	$ 0.43	$ 0.35	$ 0.77

[1] Denominator represents weighted average number of shares of Common Stock and Class B Common Stock outstanding.

[2] Options to purchase 898,640 and 658,014 shares of Common Stock for the three and six months ended June 30, 2022, respectively, and options to purchase 138,125 and 90,339 shares of Common Stock for the three and six months ended June 30, 2021, respectively, were not included in the calculations of net income per share as the effect would have been antidilutive.

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Net Income per Share - Computation of Basic and Diluted Net Income Per Share (Parenthetical) (Detail) - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Earnings Per Share [Abstract]
Options to purchase shares of Common Stock not included in the computation of diluted income per share	898,640	138,125	658,014	90,339

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Commitments and Contingencies - Additional Information (Detail)	6 Months Ended
	Jun. 30, 2022 USD ($)
Capital expenditures incurred but not yet paid	$ 10,640,000
Non Cancellable Capital Expenditure Commitments [Member]
Capital expenditure commitments	$ 32,034,000