Qorvo (QRVO) reported $818.78 million in revenue for the quarter ended June 2025, representing a year-over- year decline of 7.7%. EPS of $0.92 for the same period compares to $0.87 a year ago. View all Key Company Metrics for Qorvo here>>> The reported revenue compares to the Zacks Consensus Estimate of $774.7 million, representing a surprise of +5.69%. The company delivered an EPS surprise of +48.39%, with the consensus EPS estimate being $0.62. Shares of Qorvo have returned -0.7% over the past month versu ...

Group 1: Earnings Performance - Qorvo reported quarterly earnings of $0.92 per share, exceeding the Zacks Consensus Estimate of $0.62 per share, and up from $0.87 per share a year ago, representing an earnings surprise of +48.39% [1] - Over the last four quarters, Qorvo has consistently surpassed consensus EPS estimates [2] - The company posted revenues of $818.78 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 5.69%, although down from $886.67 million year-over-year [2] Group 2: Stock Performance and Outlook - Qorvo shares have increased approximately 20.6% since the beginning of the year, outperforming the S&P 500's gain of 8.6% [3] - The future performance of Qorvo's stock will largely depend on management's commentary during the earnings call and the earnings outlook [3][4] - The current consensus EPS estimate for the upcoming quarter is $1.68 on revenues of $961.23 million, and for the current fiscal year, it is $5.55 on revenues of $3.69 billion [7] Group 3: Industry Context - The Semiconductors - Radio Frequency industry, to which Qorvo belongs, is currently ranked in the top 5% of over 250 Zacks industries, indicating a favorable outlook [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Qorvo's stock performance [5][6]

Financial Data and Key Metrics Changes - Qorvo reported fiscal Q1 revenue of $819 million, with a non-GAAP gross margin of 44% and non-GAAP diluted earnings of $0.92 per share, all exceeding guidance [22][24] - The company held approximately $1.2 billion in cash and equivalents, with long-term debt of about $1.5 billion and no near-term maturities [23] - Operating cash flow generated during the quarter was approximately $183 million, with capital expenditures of $38 million, resulting in free cash flow of $145 million [23][24] Business Line Data and Key Metrics Changes - In the ACG segment, revenue from the largest customer represented approximately 41% of total revenue, with expectations of over 10% content growth in the upcoming fall launch compared to the previous year [22][25] - The HPA segment is expected to see strong double-digit growth, driven by defense and aerospace markets, supported by increased U.S. and allied defense spending [25][26] - The CSG segment is experiencing lower growth expectations, with a shift in automotive customer program ramping to fiscal 2027, leading to a revised growth outlook of low single digits [38][82] Market Data and Key Metrics Changes - The defense and aerospace market's sales funnel increased by approximately $2 billion sequentially, reflecting a rise in U.S. and international defense spending [11][12] - In the consumer market, Qorvo secured design wins in Wi-Fi 7 for augmented reality glasses, indicating growth in this category [10] - The Android revenue in the ACG segment declined 18% year-over-year, with China-based Android revenue down 29% year-over-year [26][67] Company Strategy and Development Direction - Qorvo is focusing on optimizing its portfolio by exiting low-margin businesses and consolidating its manufacturing footprint, including the closure of facilities in Costa Rica and North Carolina [20][21] - The company aims to enhance profitability through strategic initiatives, including cost reductions and a shift towards higher-margin defense and aerospace markets [30][31] - Qorvo is actively seeking strategic alternatives for its MEMS Force Sensing business, which is incurring significant operating expenses [30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the underlying demand across multiple end markets, despite macroeconomic uncertainties and tariff dynamics affecting certain segments [25][26] - The company anticipates continued growth in defense and aerospace, driven by increased content and spending, while remaining cautious about the smartphone market's seasonality [39][66] - Management highlighted the importance of maintaining a disciplined approach to the back half of the fiscal year, monitoring customer behavior and inventory levels closely [66][67] Other Important Information - Qorvo's non-GAAP operating expenses for the upcoming quarter are projected to be approximately $265 million, reflecting higher incentive-based compensation and startup costs for new production lines [28] - The company expects annual savings in non-GAAP COGS to exceed one-time startup costs incurred in fiscal 2026 once new production lines are operational [24][25] Q&A Session Summary Question: Can you discuss the seasonality and growth expectations for the largest customer? - Management indicated that December typically shows a slight increase in shipments compared to September, with expectations for unit volumes and content growth remaining strong [35][36] Question: What is driving the recent growth in the Android business? - Management noted that growth is attributed to share gains in the premium tier and strong content in the U.S. customer base, despite a decline in the mass-tier Android segment [43][45] Question: What initiatives are driving the increase in gross margins? - Management highlighted cost improvements, factory rationalizations, and a shift towards higher-margin defense and aerospace business as key drivers of margin expansion [49][50] Question: Can you provide an update on the defense business and M&A opportunities? - Management confirmed that the defense business is tracking well, with significant design opportunities, and indicated that they are actively looking for M&A opportunities in the defense sector [71][73] Question: How is the company managing tariff-related inventory buffering? - Management explained that while some buffering is observed, particularly in the battery-operated power tools segment, overall demand remains strong and aligned with sales patterns [76][78] Question: What are the expectations for the Android business exiting the fiscal year? - Management clarified that while the trend is down, the China Android business is expected to be higher than previously estimated, with ongoing participation in flagship and premium tier devices [102]

Financial Data and Key Metrics Changes - Qorvo reported fiscal Q1 revenue of $819 million, with a non-GAAP gross margin of 44% and non-GAAP diluted earnings of $0.92 per share, all exceeding guidance [20][24]. - The company ended the quarter with approximately $1.2 billion in cash and equivalents, $1.5 billion in long-term debt, and a net inventory balance of $638 million, reflecting a slight sequential reduction and a year-over-year decrease of $89 million [20][21]. - Operating cash flow generated during the quarter was approximately $183 million, with capital expenditures of $38 million, resulting in free cash flow of $145 million [21]. Business Line Data and Key Metrics Changes - In the Advanced Cellular Group (ACG), revenue from Android products declined 18% year-over-year to approximately $240 million, with China-based Android revenue down 29% year-over-year to just under $100 million [25][26]. - The High Performance Analog (HPA) segment is expected to see durable year-over-year growth, driven by defense and aerospace markets, which are the largest by revenue [5][24]. - Connectivity and Sensors Group (CSG) is experiencing a slowdown due to a delay in an automotive program ramp, with year-over-year growth expected to be in the low single digits instead of the previously guided 10% to 12% [36][80]. Market Data and Key Metrics Changes - The defense and aerospace market is seeing a significant increase in opportunities, with the sales funnel growing to over $7 billion, reflecting increased U.S. and international defense spending [10][12]. - In the automotive market, Qorvo's ultra-wideband technology has secured design wins with leading automotive OEMs, indicating strong demand for secure access and precision radar applications [8][9]. - The infrastructure business is benefiting from the industry's transition to DOCSIS 4.0, where Qorvo is a leading supplier of broadband amplifiers [15][24]. Company Strategy and Development Direction - Qorvo is focusing on optimizing its portfolio by exiting low-margin businesses and consolidating its manufacturing footprint, including the closure of facilities in Costa Rica and North Carolina [19][22]. - The company is strategically investing in high-growth areas such as defense, aerospace, and advanced power management solutions, while also diversifying its product offerings across various markets [5][18]. - Qorvo aims to achieve greater than 10% content growth with its largest customer in future programs, indicating a strong focus on expanding its market share in high-value segments [16][24]. Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's strategic position and execution, despite macroeconomic uncertainties and tariff dynamics affecting certain segments [38][93]. - The outlook for fiscal Q2 includes revenue expectations of $1.025 billion, with a non-GAAP gross margin between 48% and 50%, reflecting strong demand across multiple end markets [23][24]. - Management noted that while the first half of the fiscal year is showing strength, there are concerns about seasonality in the smartphone market and the impact of exiting lower-margin Android business [36][38]. Other Important Information - The company is actively seeking strategic alternatives for its MEMS Force Sensing business, which is incurring approximately $5 million of non-GAAP operating expenses per quarter [29]. - Qorvo's non-GAAP tax rate for fiscal 2026 is now expected to be approximately 15%, down from previous estimates of 18% to 19% [28]. Q&A Session Summary Question: Can you discuss the seasonality and growth expectations for the largest customer? - Management indicated that December typically shows a slight increase in shipments compared to September, with expectations for unit volumes and content growth remaining strong [34][35]. Question: What is driving the increase in gross margins? - The increase in gross margins is attributed to cost improvements, factory footprint reductions, and a favorable business mix, particularly in defense and aerospace [46][48]. Question: How is the defense business performing? - The defense business is tracking as expected, with significant design opportunities and a growing sales funnel, supported by increased government spending [70][72]. Question: What are the implications of tariffs on inventory and pricing? - Tariffs have primarily impacted the battery-operated power tools segment, with limited inventory buffering observed in other areas [75][78]. Question: What is the outlook for the Android business? - The Android business is expected to decline, particularly in the China market, with a focus on high-end devices while exiting lower-margin segments [100].

Group 1 - Qorvo reported adjusted revenue of $818.8 million for the first fiscal quarter, exceeding analyst expectations of $777.1 million [1] - The company anticipates second fiscal quarter revenue to be approximately $1.025 billion, with a range of +/- $50 million, compared to analyst expectations of $958.1 million [1] - Following the earnings report, Qorvo's stock rose by 11.61% in after-hours trading [1]

[Financial Highlights and Outlook](index=1&type=section&id=Financial%20Highlights%20and%20Outlook) [Q1 FY2026 Performance Summary](index=1&type=section&id=Q1%20FY2026%20Performance%20Summary) Qorvo's Q1 FY2026 revenue and non-GAAP EPS exceeded guidance, reaching $818.8 million and $0.92 respectively | Metric | GAAP | Non-GAAP | | :--- | :--- | :--- | | Revenue | $818.8M | $818.8M | | Gross Margin | 40.5% | 44.0% | | Operating Income | $30.1M | $108.2M | | Diluted EPS | $0.27 | $0.92 | - First quarter revenue and non-GAAP EPS surpassed the high-end of guidance, driven by **broad-based demand**[2](index=2&type=chunk) [Management Commentary](index=1&type=section&id=Management%20Commentary) Management highlighted strong Q1 results and expects continued growth and margin expansion from strategic initiatives - The company is implementing a broad set of initiatives to **structurally improve profitability**[2](index=2&type=chunk) - The CFO noted that the **Q1 non-GAAP gross margin of 44%** represented a meaningful year-over-year improvement and that actions across the business are expected to improve profitability through fiscal 2026 and 2027[2](index=2&type=chunk) [Q2 FY2026 Outlook](index=1&type=section&id=Q2%20FY2026%20Outlook) The company projects Q2 FY2026 revenue of approximately $1.025 billion and non-GAAP diluted EPS of around $2.00 | Metric | Q2 FY2026 Outlook | | :--- | :--- | | Quarterly Revenue | $1.025B ± $50M | | Non-GAAP Gross Margin | 48% - 50% | | Non-GAAP Diluted EPS | $2.00 ± $0.25 | [Selected Financial Results](index=2&type=section&id=Selected%20Financial%20Results) [Selected GAAP Results](index=2&type=section&id=Selected%20GAAP%20Results) Q1 FY2026 GAAP results show a revenue decrease but significant improvements in gross margin and operating income YoY | GAAP Metric | Q1 FY2026 | Q1 FY2025 | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | $818.8M | $886.7M | -7.7% | | Gross Margin | 40.5% | 37.5% | +3.0 ppt | | Operating Income | $30.1M | $4.6M | +554.3% | | Diluted EPS | $0.27 | $0.00 | +$0.27 | [Selected Non-GAAP Results](index=2&type=section&id=Selected%20Non-GAAP%20Results) Non-GAAP results for Q1 FY2026 indicate year-over-year growth in operating income, diluted EPS, and gross margin | Non-GAAP Metric | Q1 FY2026 | Q1 FY2025 | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | $818.8M | $886.7M | -7.7% | | Gross Margin | 44.0% | 40.9% | +3.1 ppt | | Operating Income | $108.2M | $98.1M | +10.3% | | Diluted EPS | $0.92 | $0.87 | +5.7% | [Segment Performance (GAAP)](index=3&type=section&id=SELECTED%20GAAP%20RESULTS%20BY%20OPERATING%20SEGMENT) The HPA segment demonstrated strong revenue and operating income growth, while the ACG segment saw a decline | Segment (Q1 FY2026) | Revenue | YoY Revenue Change | Operating Income | YoY Op. Income Change | | :--- | :--- | :--- | :--- | :--- | | HPA | $137.4M | +6.1% | $21.6M | +340.8% | | CSG | $110.2M | -4.1% | ($7.5M) | +61.5% (loss reduced) | | ACG | $571.2M | -11.1% | $97.9M | -15.9% | [Non-GAAP Financial Measures](index=3&type=section&id=Non-GAAP%20Financial%20Measures) [Rationale and Use](index=3&type=section&id=Rationale%20and%20Use) Management uses non-GAAP measures for internal planning and to provide investors a clearer view of business trends - Management develops its annual operating plan and makes decisions about R&D, product spending, and administrative budgets using **non-GAAP financial measures**[13](index=13&type=chunk) - The company provides non-GAAP measures to enable investors to perform additional comparisons of operating results and analyze financial performance excluding effects that may obscure trends, such as **stock-based compensation**[13](index=13&type=chunk)[14](index=14&type=chunk) [Definition of Key Non-GAAP Metrics](index=4&type=section&id=Definition%20of%20Key%20Non-GAAP%20Metrics) The company defines key non-GAAP metrics including Free Cash Flow, EBITDA, and Net Debt to assess performance - **Free Cash Flow:** Defined as net cash provided by operating activities minus property and equipment expenditures, it is used as an indicator of liquidity and financial strength[21](index=21&type=chunk) - **EBITDA:** Calculated by adjusting GAAP net income for interest, taxes, depreciation, amortization, stock-based compensation, and other charges not representative of ongoing operations[22](index=22&type=chunk) - **Net Debt or Positive Net Cash:** Defined as unrestricted cash, cash equivalents, and short-term investments minus the principal balance of borrowings, providing information on the company's indebtedness level[24](index=24&type=chunk) [Limitations and Forward-Looking Guidance](index=5&type=section&id=Limitations%20and%20Forward-Looking%20Guidance) The company acknowledges limitations of non-GAAP measures and its inability to reconcile forward-looking guidance to GAAP - The company cannot reconcile forward-looking non-GAAP guidance to GAAP due to the variability and difficulty in projecting items such as **stock-based compensation**, **acquisition costs**, and **restructuring charges**[26](index=26&type=chunk) - Key limitations of non-GAAP measures include a **lack of comparability** with other companies and the exclusion of information some may consider important, which Qorvo compensates for by providing full disclosure and reconciliations for historical data[27](index=27&type=chunk) [Detailed Financial Statements and Reconciliations](index=7&type=section&id=Detailed%20Financial%20Statements%20and%20Reconciliations) [Condensed Consolidated Statements of Income](index=7&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20INCOME) Q1 FY2026 income statement shows decreased revenue but substantially higher operating and net income year-over-year | (In thousands) | Three Months Ended June 28, 2025 | Three Months Ended June 29, 2024 | | :--- | :--- | :--- | | Revenue | $818,778 | $886,671 | | Gross Profit | $331,802 | $332,304 | | Operating Income | $30,086 | $4,606 | | Net Income | $25,594 | $414 | | Diluted EPS | $0.27 | $0.00 | [Reconciliation of GAAP to Non-GAAP Measures](index=8&type=section&id=RECONCILIATION%20OF%20GAAP%20TO%20NON-GAAP%20FINANCIAL%20MEASURES) Q1 FY2026 GAAP net income was reconciled to non-GAAP net income primarily by adjusting for stock-based compensation | Reconciliation (Q1 FY2026, in thousands) | Amount | | :--- | :--- | | **GAAP net income** | **$25,594** | | Stock-based compensation expense | $42,475 | | Amortization of acquired intangible assets | $21,521 | | Restructuring-related charges | $7,879 | | Other adjustments (net) | ($6,005) | | **Non-GAAP net income** | **$86,474** | - **Non-GAAP gross margin of 44.0%** was derived from GAAP gross margin of 40.5% by excluding items such as stock-based compensation ($5.6M) and amortization of acquired intangibles ($19.2M)[38](index=38&type=chunk) [Condensed Consolidated Balance Sheets](index=11&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) The balance sheet as of June 2025 reflects a slight increase in total assets and stable long-term debt levels | (In thousands) | June 28, 2025 | March 29, 2025 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $1,165,478 | $1,021,176 | | Inventories | $637,961 | $640,992 | | Total current assets | $2,246,256 | $2,167,275 | | Total assets | $5,997,524 | $5,933,131 | | **Liabilities & Equity** | | | | Total current liabilities | $798,330 | $783,182 | | Long-term debt | $1,549,200 | $1,549,215 | | Total liabilities | $2,560,455 | $2,540,819 | | Total stockholders' equity | $3,437,069 | $3,392,312 | [Condensed Consolidated Statements of Cash Flows](index=12&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) The company generated significantly higher cash from operations in Q1 FY2026 compared to the prior-year quarter | (In thousands) | Three Months Ended June 28, 2025 | | :--- | :--- | | Net cash provided by operating activities | $182,945 | | Net cash used in investing activities | ($33,331) | | Net cash used in financing activities | ($6,935) | | Net increase in cash | $144,302 | - **Free cash flow** for Q1 FY2026 was **$145.4 million**, calculated from $182.9 million in net cash from operating activities minus $37.5 million in purchases of property and equipment[38](index=38&type=chunk) [Corporate Information and Disclosures](index=6&type=section&id=Corporate%20Information%20and%20Disclosures) [About Qorvo and Conference Call](index=6&type=section&id=About%20Qorvo%20and%20Conference%20Call) Qorvo provides semiconductor solutions for high-growth markets and held a conference call to discuss quarterly results - Qorvo supplies semiconductor solutions to diverse markets including automotive, consumer, defense & aerospace, industrial & enterprise, infrastructure, and mobile[29](index=29&type=chunk) - A conference call to discuss the press release was scheduled for 4:30 p.m. ET on the day of the release[28](index=28&type=chunk) [Forward-Looking Statements Disclaimer](index=6&type=section&id=Forward-Looking%20Statements) The report contains forward-looking statements subject to significant risks and uncertainties detailed in SEC filings - The press release includes forward-looking statements that are not historical facts and are subject to risks that could cause **actual results to differ materially**[31](index=31&type=chunk) - Key business risks include **fluctuations in operating results**, dependence on a few large customers, manufacturing facility risks, and changes in government trade policies[31](index=31&type=chunk)

GREENSBORO, N.C., July 29, 2025 (GLOBE NEWSWIRE) -- Qorvo (Nasdaq:QRVO), a leading global provider of connectivity and power solutions, today announced financial results for the Company's fiscal 2026 first quarter ended June 28, 2025. On a GAAP basis, revenue for Qorvo's fiscal 2026 first quarter was $818.8 million, gross margin was 40.5%, operating income was $30.1 million, and diluted earnings per share was $0.27. On a non-GAAP basis, gross margin was 44.0%, operating income was $108.2 million, and dilute ...

Core Viewpoint - Qorvo, Inc. (QRVO) is expected to report a revenue decline in fiscal Q1 2025, despite recent product innovations that may positively impact earnings [1][10]. Group 1: Financial Performance - Qorvo is set to report fiscal first-quarter 2025 results on April 29, with a previous earnings surprise of 24.73% and an average trailing four-quarter earnings surprise of 40.59% [1]. - The Zacks Consensus Estimate for total revenues in the June quarter is $774.7 million, indicating a 12.63% year-over-year decline [6][10]. - The High-Performance Analog segment is expected to generate net sales of $135.76 million, down from $164 million in the same quarter last year [5]. Group 2: Product Innovations - Qorvo introduced two hybrid power doubler amplifiers, QPA3311 and QPA3316, aimed at enhancing broadband cable networks through improved signal integrity and reduced infrastructure costs [2]. - The company also launched two S-Band switched filter bank modules, QPB1034 and QPB1036, to meet the growing demand for efficient radar systems in defense and aerospace applications [3]. Group 3: Market Challenges - The company faces intense competition, leading to pricing pressure that could impact overall performance [4][10]. - Macroeconomic headwinds are also affecting net sales across various segments [4].

Core Viewpoint - Qorvo, Inc. (NASDAQ: QRVO) is set to report its Q1 earnings on July 29, with a focus on key financial metrics and performance indicators that will be closely monitored by investors [1]. Company Summary - Qorvo is expected to provide insights into its financial performance, which will be critical for long-term investors who typically have a 5-10 year investment horizon [1]. - The company is part of a portfolio strategy that emphasizes a mix of growth, value, and dividend-paying stocks, with a particular focus on value investments [1]. Industry Context - The upcoming earnings report is significant for the semiconductor industry, as it may reflect broader market trends and investor sentiment within the sector [1].

Core Viewpoint - Qorvo will host a conference call to discuss its fiscal 2026 first quarter financial results on July 29, 2025, at 4:30 p.m. (ET) [1] Group 1: Conference Call Details - The conference call will be available via live webcast on the Company's Investor Relations website [1] - A telephone playback of the conference call will be accessible approximately two hours after the call's completion until August 5, 2025 [2] - Qorvo will distribute its fiscal 2026 first quarter financial results at approximately 4:00 p.m. (ET) on the same day [2] Group 2: Company Overview - Qorvo is a leading global provider of connectivity and power solutions, specializing in innovative semiconductor solutions [3] - The company serves various high-growth segments, including automotive, consumer, defense & aerospace, industrial & enterprise, infrastructure, and mobile [3]