Financial Data and Key Metrics Changes - Revenues increased by 12% year over year to $267 million, slightly above the midpoint of guidance [8] - Non-GAAP gross margin was 53.5%, in line with guidance [21] - Non-GAAP EPS grew 70% year over year to $0.90, exceeding guidance [8][21] - Non-GAAP net income for Q3 was $35.3 million [21] - Cash and short-term investments decreased to approximately $421.4 million, down $174.7 million from the prior quarter [22] Business Line Data and Key Metrics Changes - Core IoT product sales increased 43% year over year to $68 million, driven by strong demand and new design wins [9][20] - Enterprise and automotive product revenues improved 14% year over year but decreased 3% sequentially, mainly due to softness in automotive [20] - Mobile product revenues decreased 4% sequentially and 18% year over year due to product shipments reaching end of life [20] Market Data and Key Metrics Changes - The revenue mix for Q3 was 25% core IoT, 58% enterprise and automotive, and 17% mobile products [20] - The company noted lean customer and channel inventories, indicating healthy demand trends [10] Company Strategy and Development Direction - The company is focused on technology innovation, market expansion, and operational excellence to position for long-term success [11] - The launch of new products, including Wi-Fi 7 devices and AI-native processors, aims to capture new market opportunities [12][14] - The company is investing in go-to-market initiatives and expanding its business development and sales teams [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the current demand trends and backlog levels, despite uncertainties related to tariffs [40][41] - The company anticipates June revenues to be approximately $280 million at the midpoint, reflecting continued growth [24] - Management highlighted the importance of monitoring macroeconomic conditions and their potential impact on future demand [24][41] Other Important Information - The company returned approximately $128 million to shareholders through share repurchases in the fiscal year [22] - The company is navigating challenges in the automotive sector but expects long-term growth from OLED screen adoption [18] Q&A Session Summary Question: What drove the strength in core IoT in both the quarter and the guide? - Management indicated that strong demand from existing products and the ramp of Wi-Fi 7 contributed to the growth, with expectations of an additional $10 million per quarter from the Broadcom acquisition [30][31] Question: Do you see incremental opportunities to win versus FPGA-based solutions? - Management noted a competitive advantage with lower cost and power-efficient solutions, enhancing user experience [32][34] Question: Has there been any impact from tariff-related macro concerns? - Management confirmed strong performance and healthy backlog levels, with ongoing monitoring of potential tariff impacts [40][41] Question: Can you discuss the Broadcom acquisition and its impact? - The acquisition is expected to open new market opportunities and enhance the company's long-term growth potential [54] Question: What is the competitive landscape for Wi-Fi 7 in IoT applications? - The company is the first to introduce Wi-Fi 7 for IoT, focusing on low power consumption and advanced processing techniques [59] Question: When will there be synchronized growth in end markets? - Management expects continued growth in core IoT, with enterprise and automotive markets showing potential for recovery [68]

Financial Data and Key Metrics Changes - Revenues increased 12% year over year to $267 million, slightly above the midpoint of guidance [6][18] - Non-GAAP gross margin was 53.5%, in line with guidance [6][20] - Non-GAAP EPS grew 70% year over year to $0.90, exceeding guidance [6][20] - Non-GAAP operating margin was 15.6%, up approximately 270 basis points year over year [20] Business Line Data and Key Metrics Changes - Core IoT product sales increased 43% year over year to $68 million, driven by strong demand and new design wins [6][19] - Enterprise and automotive product revenues improved 14% year over year but were down 3% sequentially, mainly due to softness in automotive [19] - Mobile product revenues decreased 4% sequentially and 18% year over year due to end-of-life shipments to a large customer [19] Market Data and Key Metrics Changes - Revenue mix for Q3 was 25% core IoT, 58% enterprise and automotive, and 17% mobile products [19] - The company noted lean customer and channel inventories, indicating healthy demand trends [9] Company Strategy and Development Direction - The company is focused on technology innovation, market expansion, and operational excellence to position for long-term success [10][24] - Investments in go-to-market initiatives and business development are being made to drive growth in the edge AI IoT market [14][69] - The launch of Wi-Fi 7 and new processor products is expected to open significant market opportunities [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the current demand environment, with healthy backlog and bookings [38][40] - The potential indirect impacts of tariffs on future demand and supply chains remain a concern [23][39] - The company anticipates Q4 revenues to be approximately $280 million at the midpoint, reflecting continued growth [23][24] Other Important Information - The company ended the quarter with approximately $421.4 million in cash and short-term investments, down from the previous quarter [21] - Capital expenditures were $5.4 million, and depreciation for the quarter was $7.2 million [22] Q&A Session Summary Question: What drove the strength in core IoT in both the quarter and the guide? - The strength was driven by wireless growth, with expectations of $10 million per quarter from the Broadcom acquisition [28][29] Question: Do you see incremental opportunities to win versus FPGA based solutions with UPD? - The company has gained significant share with major OEMs and has a lower cost, more power-efficient solution compared to FPGAs [31][32] Question: Has there been any impact from tariff-related macro concerns? - There has been no direct impact yet, but the uncertainty around tariffs could affect future demand [38][48] Question: Where are the share gains coming from in the PC market? - Share gains are coming from working with major OEMs like Dell, HP, and Lenovo, driven by innovation and quality [41][42] Question: What is the status of the Broadcom acquisition? - The acquisition is expected to open new market opportunities and is integrated into the core IoT business [52] Question: How does the competitive landscape look for Wi-Fi 7 in IoT applications? - The company is the first to introduce Wi-Fi 7 for IoT, focusing on low power consumption and advanced processing techniques [57] Question: When will synchronized growth in end markets be expected? - Core IoT is expected to continue leading growth, while enterprise and automotive markets are showing mixed trends [66][68]

Table of Contents ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 29, 2025 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to . Commission file number 000-49602 ______________________________________________________________________________________________________ SYNAPTICS INCORPORATED (Exact name of registrant as specified in its charter) _________________ ...

Synaptics Third Quarter Fiscal 2025 Results [Financial Highlights and Business Outlook](index=1&type=section&id=Financial%20Highlights%20and%20Business%20Outlook) The company reported solid Q3 FY2025 results with significant revenue growth driven by Core IoT products and provided a positive outlook for Q4 [Q3 Fiscal 2025 Performance](index=1&type=section&id=Q3%20Fiscal%202025%20Performance) Revenue grew 12% year-over-year to $266.6 million, driven by a 43% surge in Core IoT product sales Q3 Fiscal 2025 Performance | Metric | Value | | :--- | :--- | | Net Revenue | $266.6 million | | GAAP Gross Margin | 43.4% | | Non-GAAP Gross Margin | 53.5% | | GAAP Loss per Share | ($0.56) | | Non-GAAP Diluted EPS | $0.90 | - Total revenue increased by **over 12% year-over-year**, marking the fourth consecutive quarter of YoY growth[2](index=2&type=chunk)[4](index=4&type=chunk) - Growth was driven by **Core IoT products**, which grew **43% year-over-year** and constituted **25% of total sales**[2](index=2&type=chunk)[4](index=4&type=chunk) - The company generated **over $74 million in cash flow** from operations during the third quarter[5](index=5&type=chunk) - Approximately **546,000 shares were repurchased** for **$37.9 million**[6](index=6&type=chunk) [Q4 Fiscal 2025 Outlook](index=1&type=section&id=Q4%20Fiscal%202025%20Outlook) The company projects continued revenue growth for Q4, with revenue expected to be in the range of $280 million ± $15 million - The fourth-quarter guidance reflects **improving demand trends**, with expectations of both sequential and year-over-year revenue growth[5](index=5&type=chunk) Q4 Fiscal 2025 Guidance | Metric | GAAP Guidance | Non-GAAP Guidance | | :--- | :--- | :--- | | Revenue | $280M ± $15M | N/A | | Gross Margin | 42.5% ± 2.0% | 53.5% ± 1.0% | | Operating Expense | $150M ± $4M | $103M ± $2M | | Earnings (loss) per share | ($0.68) ± $0.30 | $1.00 ± $0.20 | [Consolidated Financial Statements](index=8&type=section&id=Consolidated%20Financial%20Statements) Financial statements show YoY revenue growth but a higher net loss, with a significant decrease in cash due to acquisitions and financing activities [Condensed Consolidated Statements of Income](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) Q3 revenue increased year-over-year, but a higher operating loss was driven by an intangible asset impairment charge Condensed Consolidated Statements of Income (In millions, except per share) | (In millions, except per share) | Q3 FY2025 | Q3 FY2024 | | :--- | :--- | :--- | | Net revenue | $266.6 | $237.3 | | Gross margin | $115.8 | $110.3 | | Operating loss | $(26.3) | $(17.4) | | Net loss | $(21.8) | $(18.1) | | Basic loss per share | $(0.56) | $(0.46) | - The company recorded a **$13.8 million intangible asset impairment charge** in Q3 2025, which was not present in the prior year's quarter[31](index=31&type=chunk)[32](index=32&type=chunk) [Condensed Consolidated Balance Sheets](index=8&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased primarily due to a significant reduction in cash and cash equivalents, while liabilities fell from debt reduction Condensed Consolidated Balance Sheets (In millions) | (In millions) | March 2025 | June 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $360.4 | $876.9 | | Total current assets | $712.6 | $1,162.3 | | Total assets | $2,554.3 | $2,825.0 | | Long-term debt | $834.2 | $966.9 | | Total liabilities | $1,167.3 | $1,358.2 | | Total stockholders' equity | $1,387.0 | $1,466.8 | [Condensed Consolidated Cash Flows](index=13&type=section&id=Condensed%20Consolidated%20Cash%20Flows) Operating activities generated cash, but this was offset by significant cash usage for acquisitions, debt repayment, and stock repurchases Condensed Consolidated Cash Flows (In millions) | (In millions) | Nine Months Ended March 2025 | Nine Months Ended March 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $84.8 | $70.9 | | Net cash used in investing activities | $(289.0) | $(146.7) | | Net cash used in financing activities | $(313.0) | $(20.4) | | Net decrease in cash and cash equivalents | $(516.5) | $(96.6) | - Key uses of cash in the nine-month period included **$198.8 million for a business acquisition**, **$112.3 million for stock repurchases**, and **$583.5 million for debt repayment**[36](index=36&type=chunk) [Reconciliation of GAAP to Non-GAAP Financial Measures](index=10&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Financial%20Measures) This section details adjustments from a GAAP net loss of $21.8 million to a non-GAAP net income of $35.3 million for Q3 FY2025 Q3 FY2025 GAAP Net Loss to Non-GAAP Net Income Reconciliation (In millions) | Description | Amount | | :--- | :--- | | **GAAP net loss** | **$(21.8)** | | Acquisition and integration related costs | $32.8 | | Share-based compensation | $19.9 | | Intangible asset impairment | $13.8 | | Other adjustments (Restructuring, Legal, etc.) | $1.3 | | Non-GAAP tax adjustments | $(11.4) | | **Non-GAAP net income** | **$35.3** | Q3 FY2025 GAAP EPS to Non-GAAP EPS Reconciliation | Description | Per Share Amount | | :--- | :--- | | **GAAP net loss per share** | **$(0.56)** | | Adjustments (Acquisition, SBC, Impairment, etc.) | $1.75 | | Non-GAAP tax adjustments | $(0.29) | | **Non-GAAP net income per share - diluted** | **$0.90** | [Use of Non-GAAP Financial Information](index=3&type=section&id=Use%20of%20Non-GAAP%20Financial%20Information) The company utilizes non-GAAP measures to provide a clearer view of core operating performance by excluding certain non-recurring or non-cash items - The company uses Non-GAAP measures to supplement GAAP results, believing they provide a better view of **core operating performance** by excluding certain items[13](index=13&type=chunk) - Key adjustments include **acquisition and integration-related costs**, such as amortization of purchased intangibles and legal costs associated with acquisitions[14](index=14&type=chunk)[15](index=15&type=chunk) - **Share-based compensation** is excluded because it is a non-cash expense and its amount can vary based on market forces beyond the company's control[16](index=16&type=chunk) - Other excluded items are **intangible asset impairment charges**, restructuring costs, site remediation accruals, and legal settlements[17](index=17&type=chunk)[18](index=18&type=chunk)[19](index=19&type=chunk)[20](index=20&type=chunk) [Cautionary Statement Regarding Forward-Looking Statements](index=6&type=section&id=Cautionary%20Statement%20Regarding%20Forward-Looking%20Statements) Forward-looking statements, including financial guidance, are subject to significant risks and uncertainties that could impact actual results - The press release contains forward-looking statements, including **financial guidance for Q4 FY2025**, which are not guarantees of future performance[25](index=25&type=chunk) - Key risks that could impact future results include **macroeconomic uncertainties**, supply chain disruptions, dependence on large customers, and industry cyclicality[25](index=25&type=chunk) - The company also highlights risks related to **global and geopolitical tensions**, the ability to retain key personnel during a **CEO transition**, and the ability to realize benefits from its transaction with Broadcom[25](index=25&type=chunk)

Core Insights - Synaptics and Murata Manufacturing are collaborating to create a next-generation turnkey wireless connectivity module specifically for automotive Tier 1 suppliers and OEMs [1] - The partnership will leverage Synaptics' Veros™ Wi-Fi and Bluetooth combo systems on chips (SoCs), which are designed for high performance, low cost, and low power consumption in automotive applications [1][2] Company Overview - Synaptics is focused on innovation in AI at the Edge, enhancing user engagement with intelligent connected devices across various environments [4] - The company offers a range of solutions including Synaptics Astra™ AI-Native embedded compute, Veros™ wireless connectivity, and multimodal sensing solutions [4] - Murata Manufacturing is a leader in the design and manufacture of ceramic-based passive electronic components and communication modules, committed to advanced electronic materials and high-density modules [5] Product Development - Synaptics' Veros portfolio includes products like SYN4383 (Wi-Fi 6E) and SYN4384 (Wi-Fi 7), which are compatible and offer software upgradability [2] - The SYN4390 product provides high-throughput Wi-Fi 7 capabilities for automotive applications, indicating a solid wireless roadmap for future innovations [2] - The collaboration aims to combine Synaptics' SoCs with Murata's expertise in compact and reliable module design, enhancing the performance and integration of wireless modules for the automotive market [3]

Core Insights - Synaptics has launched its first family of Wi-Fi 7 systems-on-chips (SoCs) for IoT, including the SYN4390 and SYN4384, which support bandwidths up to 320 MHz and deliver peak speeds of 5.8 Gbps with low latency [1][3][4] - The new SoCs integrate Wi-Fi 7 with Bluetooth 6.0 and Zigbee/Thread, designed to minimize system costs and power consumption while enhancing user experiences across various applications [1][2][4] - ABI Research forecasts that annual shipments of Wi-Fi 7 chipsets will exceed 2 billion by 2029, with a compound annual growth rate (CAGR) of 56% from 2024 to 2029 [3] Product Features - The Wi-Fi 7 IoT family supports Matter and features a triple combo design, enabling interoperability across Wi-Fi, Bluetooth, and Zigbee/Thread networks [5] - The SYN4390 is currently available for sale, while the SYN4384 is available in limited quantities for evaluation [5] - Key specifications include peak speeds of up to 5.8 Gbps, 320 MHz channel bandwidth, integrated RF front-end, and power management IC to reduce system costs and power consumption [6] Market Opportunity - The growing adoption of Wi-Fi 7 in wireless networking infrastructure presents significant opportunities for diverse Wi-Fi 7-enabled IoT devices [3][4] - Synaptics aims to provide a versatile solution for high-performance, low-power IoT devices, facilitating the development of next-generation connected and AI-enriched IoT products [3][4] - The expansion of Wi-Fi 7 across multiple IoT segments is expected to reach billions of annual device shipments in the coming years [4]

Core Insights - The Edge AI Foundation has rebranded from the TinyML Foundation and released the "2025 Edge AI Technology Report," highlighting the maturity and real-world applications of TinyML [1][3]. Group 1: Edge AI Technology Drivers - The report discusses advancements in hardware and software that support Edge AI deployment, focusing on innovations in dedicated processors and ultra-low power devices [3]. - Edge AI is transforming operational models across various industries by enabling real-time analysis and decision-making capabilities [3]. Group 2: Industry Applications of Edge AI - In the automotive sector, Edge AI enhances safety and response times, with examples like Waymo and NIO utilizing real-time data processing for improved performance [7][8]. - Manufacturing benefits from Edge AI through predictive maintenance, quality control, and process optimization, with reported reductions in maintenance costs by 30% and downtime by 45% [9][12]. - In healthcare, localized AI accelerates diagnostics and improves patient outcomes by analyzing medical data directly on devices [14]. - Retail operations are optimized through real-time behavior analysis and AI-driven systems, reducing checkout times by 30% [16]. - Logistics is enhanced by integrating Edge AI with IoT sensors, allowing for immediate analysis of data and optimization of supply chain operations [18]. - Smart agriculture utilizes Edge AI for precision farming, reducing water usage by 25% and pesticide use by 30% [21]. Group 3: Edge AI Ecosystem and Collaboration - The Edge AI ecosystem relies on collaboration among hardware vendors, software developers, cloud providers, and industry stakeholders to avoid fragmentation [24]. - A three-layer architecture is recognized for Edge AI, distributing workloads across edge devices, edge servers, and cloud platforms [24][25]. - Cross-industry partnerships are increasing, with companies like Intel and Qualcomm collaborating to enhance Edge AI deployment [26][27]. Group 4: Emerging Trends in Edge AI - Five emerging trends are reshaping Edge AI, including federated learning, quantum neural networks, and neuromorphic computing [30]. - Federated learning is expected to enhance model adaptability and collaboration across industries, with a projected market value of nearly $300 million by 2030 [31]. - Quantum computing is set to redefine Edge AI capabilities, enabling faster decision-making and real-time processing [34][36]. - AI-driven AR/VR applications are evolving with Edge AI, allowing for real-time responses and improved energy efficiency [39]. - Neuromorphic computing is gaining traction for its energy efficiency and ability to handle complex tasks without cloud connectivity [41].