FORM's Q3 Earnings Surpass Estimates, Revenues Up Y/Y, Shares Rise

Core Insights - FormFactor (FORM) reported third-quarter 2025 non-GAAP earnings of 33 cents per share, exceeding the Zacks Consensus Estimate by 32%, although the earnings decreased 5.7% year over year. Shares increased by 23.5% at the time of reporting [1] - Revenues for the quarter were $202.7 million, surpassing the Zacks Consensus Estimate by 1.31%, but reflecting a 2.5% decline year over year [1] Segmental Revenue Details - Probe card revenues amounted to $166.4 million, down 3.4% year over year, primarily due to a decline in Foundry & Logic revenues, which were $92.9 million (45.8% of total revenues), down 13.6% year over year. DRAM revenues were $68.2 million (33.6% of total revenues), up 13.3% year over year, while Flash revenues were $5.3 million (2.6% of total revenues), up 17.8% year over year [2] - Systems revenues, accounting for 17.9% of total revenues, were $36.3 million, reflecting a 1.7% increase year over year [3] Geographic Revenue Performance - Revenues from South Korea, Japan, Malaysia, Singapore, and the Rest of the World increased by 69.8%, 40.7%, 9.4%, 80%, and 14.3% year over year, respectively. Conversely, revenues from the United States, Taiwan, China, and Europe declined by 33.8%, 2.1%, 66.1%, and 5.1% year over year [4] Operating Results - The gross margin contracted by 110 basis points year over year to 41%. Non-GAAP operating expenses decreased by 8% year over year to $54.6 million, representing 26.9% of revenues, down 160 basis points year over year. The non-GAAP operating margin improved by 50 basis points year over year to 14.1% [5] Balance Sheet & Cash Flow - As of September 27, 2025, cash and cash equivalents, along with marketable securities, totaled $266 million, up from $249.3 million as of June 28, 2025. Cash generated from operating activities was $27 million in the reported quarter, an increase from $18.9 million in the previous quarter, with free cash flow at $19.7 million [6] Future Guidance - FormFactor anticipates third-quarter 2025 revenues of $210 million (+/- $5 million), with the Zacks Consensus Estimate currently at $199.43 million, indicating a 5.3% growth compared to the previous year. The company expects a non-GAAP gross margin of 42% (+/- 1.5%) and earnings of 35 cents (+/- 4 cents) per share [7][8]