Financial Data and Key Metrics Changes - Qorvo reported fiscal third quarter revenue of $993 million, with a non-GAAP gross margin of 49.1% and non-GAAP diluted earnings of $2.17 per share, all of which compared favorably to guidance [16] - The company generated operating cash flow of approximately $265 million and incurred $28 million in capital expenditures, resulting in free cash flow of $237 million [17] - For the upcoming March quarter, revenue is expected to be $800 million ± $25 million, with a non-GAAP gross margin between 48% and 49% [17] Business Line Data and Key Metrics Changes - In the ACG segment, December quarterly revenue declined sequentially, consistent with typical seasonality, but saw double-digit revenue growth compared to last December due to content gains from the largest customer [7] - CSG is on track with an automotive ultra-wideband program, receiving first production orders during the December quarter, indicating strong customer demand [10] - HPA continues to see multiyear tailwinds in defense and aerospace markets, with expected sales in D&A markets totaling approximately $500 million for fiscal year 2027 [13] Market Data and Key Metrics Changes - Android revenue is expected to decline by approximately $300 million in fiscal 2027, primarily due to strategic actions to reduce exposure to lower-margin segments and the impact of memory pricing on mass-tier Android build plans [9][27] - The company anticipates a mid-single-digit decline in full-year revenue for fiscal 2027, with ACG declining but becoming more profitable, CSG remaining approximately flat, and HPA continuing its double-digit growth [15] Company Strategy and Development Direction - Qorvo is pursuing a long-term growth strategy while optimizing profitability and reducing capital intensity through restructuring actions [5] - The company is intentionally resizing its Android business to reduce exposure to lower-margin segments while focusing on high-volume premium and flagship tiers [10] - Qorvo is divesting or exiting underperforming businesses to improve overall profitability and is strategically managing its product portfolio and pricing [18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to compete effectively and grow its footprint despite increased competition in certain product areas [24] - The company expects improvements in gross margins due to a healthier revenue mix and ongoing operating expense reduction efforts [10][15] - Management highlighted that the defense and aerospace business is expected to surpass the Android business in size, reflecting a significant shift in the company's portfolio [15] Other Important Information - The company closed its Costa Rica facility ahead of schedule and transitioned to external partners, which is expected to enhance operational efficiency [6] - Qorvo's non-GAAP tax rate for fiscal 2026 is expected to be approximately 15%, with ongoing monitoring of potential changes in tax policy [18] Q&A Session Summary Question: Content roadmap and competition in sockets - Management acknowledged increased competition due to dual sourcing but emphasized ongoing opportunities for growth in various sockets [22][24] Question: Android revenue decline and seasonal expectations - Management clarified that the expected decline in Android revenue is due to strategic exits from lower-margin business and not typical seasonal patterns [25][27] Question: Impact of memory pricing on Android business - Management indicated that higher memory prices are affecting customer build plans, accelerating the strategic exit from lower-tier Android businesses [54] Question: Gross margin outlook for fiscal 2027 - Management stated that margin improvements will primarily come from a favorable business mix, particularly as HPA becomes a larger percentage of total revenue [33] Question: Changes in inventory levels at customers - Management reported no abnormal inventory levels, attributing adjustments to customer build plans in response to memory pricing [58]