Synaptics(US:SYNA)2025-05-08 22:02Financial 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]