Qorvo(US:QRVO)2025-11-03 21:16Revenue Performance - Revenue for Q2 fiscal 2026 increased by 1.1% to $1,058.5 million compared to $1,046.5 million in Q2 fiscal 2025, driven by increased content in flagship smartphones and defense programs [84]. - Revenue for the first six months of fiscal 2026 decreased by 2.9% to $1,877.3 million compared to $1,933.2 million in the same period of fiscal 2025 [85]. - The company experienced a decrease in revenue in ACG and CSG segments by $45.6 million and $44.6 million respectively, while HPA revenue increased by $34.3 million [90]. - Advanced Cellular Group (ACG) revenue for the three months ended September 27, 2025, increased by $25.5 million, or 3.4%, to $777.0 million, driven by increased content in flagship and premium smartphone tiers [104]. - HPA revenue for the six months ended September 27, 2025, increased by $34.3 million, or 12.3%, to $312.0 million compared to $277.7 million for the same period in 2024 [95]. Profitability Metrics - Gross margin improved to 47.0% in Q2 fiscal 2026 from 42.6% in Q2 fiscal 2025, attributed to reduced exposure to lower-margin Android smartphones and increased defense revenue [84]. - Operating income surged to $157.7 million in Q2 fiscal 2026, a significant increase from $9.7 million in Q2 fiscal 2025, reflecting a 1,529.8% change [85]. - Net income per diluted share was $1.28 for Q2 fiscal 2026, compared to a net loss of $0.18 per share in Q2 fiscal 2025 [84]. - ACG operating income for the three months ended September 27, 2025, was $215.1 million, a decrease of 10.1% from $236.7 million in the prior year [104]. - CSG operating loss for the three months ended September 27, 2025, was $21.6 million, compared to an operating loss of $9.0 million in the same period last year, reflecting a 140.9% increase in losses [100]. Cash Flow and Capital Expenditures - Net cash provided by operating activities decreased to $84.0 million in Q2 fiscal 2026 from $127.8 million in Q2 fiscal 2025, due to changes in working capital [84]. - Net cash provided by operating activities was $266.9 million for the six months ended September 27, 2025, compared to $208.9 million for the same period in 2024, reflecting an increase of approximately 28% [123][124]. - Capital expenditures rose to $41.8 million in Q2 fiscal 2026, up from $33.0 million in Q2 fiscal 2025 [84]. - Net cash used in investing activities increased to $66.0 million for the six months ended September 27, 2025, from $52.0 million in the prior year [125]. - Net cash used in financing activities was $120.3 million for the six months ended September 27, 2025, compared to $109.3 million for the same period in 2024, indicating an increase of about 10% [126]. Share Repurchase and Capital Commitments - The company repurchased approximately 0.7 million shares for about $65.3 million during Q2 fiscal 2026 [84]. - The company repurchased approximately 1.4 million shares of common stock for about $115.4 million during the six months ended September 27, 2025, with $833.7 million remaining authorized for future repurchases [122]. - Capital commitments as of September 27, 2025, were approximately $63.0 million, primarily for expanding capabilities to develop and support new products [132]. Debt and Financing - The company has a $325.0 million senior revolving line of credit available under a new credit agreement, with no borrowings made under this facility as of September 27, 2025 [127][128]. - The company issued $350.0 million aggregate principal amount of 2029 Notes, with an interest rate of 4.375% per annum, maturing on October 15, 2029 [129][130]. - The company anticipates that future capital requirements may differ materially based on market acceptance of products and technological advances, with potential needs for additional debt or equity financing [133]. Legal Proceedings - The company is involved in various legal proceedings that are not expected to have a material adverse effect on its consolidated financial position or results of operations [134].