Qorvo® Announces Fiscal 2026 First Quarter Financial Results
GREENSBORO, N.C., July 29, 2025 (GLOBE NEWSWIRE) -- Qorvo® (NASDAQ:QRVO), a leading global provider of connectivity and power solutions, today announced financial results for the Company's fiscal 2026 first quarter ended June 28, 2025.
On a GAAP basis, revenue for Qorvo's fiscal 2026 first quarter was $818.8 million, gross margin was 40.5%, operating income was $30.1 million, and diluted earnings per share was $0.27. On a non-GAAP basis, gross margin was 44.0%, operating income was $108.2 million, and diluted earnings per share was $0.92.
Bob Bruggeworth, president and chief executive officer of Qorvo, said, "The Qorvo team delivered a strong fiscal 2026 first quarter. We are undertaking a broad set of initiatives to structurally enhance profitability, and we are already seeing the positive effects of these strategic actions. In the September quarter, we expect sequential growth and margin expansion to be supported by increases in Qorvo content and unit volumes in large customer programs."
Financial Commentary and Outlook
Grant Brown, chief financial officer of Qorvo, said, "Qorvo's fiscal first quarter revenue and non-GAAP EPS exceeded the high-end of guidance, driven by broad-based demand. Fiscal first quarter non-GAAP gross margin of 44% achieved the high-end of guidance and represented a meaningful year-over-year improvement. Furthermore, our fiscal second quarter non-GAAP gross margin guidance of 48% - 50% would represent a 200 basis-point improvement versus last year at the midpoint. These improvements demonstrate the actions being undertaken across our product portfolio, business segments, and manufacturing footprint that will enable us to improve profitability as we advance through fiscal 2026 and into fiscal 2027."
Qorvo's current outlook for the September 2025 quarter is:
Quarterly revenue of approximately $1.025 billion, plus or minus $50 million
Non-GAAP gross margin between 48% and 50%
Non-GAAP diluted earnings per share of $2.00, plus or minus 25 cents
See "Forward-looking non-GAAP financial measures" below. Qorvo's actual quarterly results may differ from these expectations and projections, and such differences may be material.
Selected Financial Information
The following tables set forth selected GAAP and non-GAAP financial information for Qorvo for the periods indicated. See the more detailed financial information for Qorvo, including reconciliations of GAAP and non-GAAP financial information, attached.
SELECTED GAAP RESULTS
(In millions, except for percentages and EPS)
(Unaudited)
Q1 Fiscal 2026
Q4 Fiscal 2025
Q1 Fiscal 2025
Sequential Change
Year-over-Year Change
Revenue
$
818.8
$
869.5
$
886.7
$
(50.7
)
$
(67.9
)
Gross profit
$
331.8
$
366.6
$
332.3
$
(34.8
)
$
(0.5
)
Gross margin
40.5
%
42.2
%
37.5
%
(1.7
) ppt
3.0
ppt
Operating expenses
$
301.7
$
338.3
$
327.7
$
(36.6
)
$
(26.0
)
Operating income
$
30.1
$
28.2
$
4.6
$
1.9
$
25.5
Net income
$
25.6
$
31.4
$
0.4
$
(5.8
)
$
25.2
Weighted-average diluted shares
93.8
94.1
96.5
(0.3
)
(2.7
)
Diluted EPS
$
0.27
$
0.33
$
0.00
$
(0.06
)
$
0.27
SELECTED NON-GAAP RESULTS (1)
(In millions, except for percentages and EPS)
(Unaudited)
Q1 Fiscal 2026
Q4 Fiscal 2025
Q1 Fiscal 2025
Sequential Change
Year-over-Year Change
Revenue
$
818.8
$
869.5
$
886.7
$
(50.7
)
$
(67.9
)
Gross profit
$
360.0
$
398.7
$
362.7
$
(38.7
)
$
(2.7
)
Gross margin
44.0
%
45.9
%
40.9
%
(1.9
) ppt
3.1
ppt
Operating expenses
$
251.8
$
246.8
$
264.5
$
5.0
$
(12.7
)
Operating income
$
108.2
$
151.8
$
98.1
$
(43.6
)
$
10.1
Net income
$
86.5
$
133.3
$
83.5
$
(46.8
)
$
3.0
Weighted-average diluted shares
93.8
94.1
96.5
(0.3
)
(2.7
)
Diluted EPS
$
0.92
$
1.42
$
0.87
$
(0.50
)
$
0.05
(1) Adjusted for stock-based compensation expense; amortization of acquired intangible assets; restructuring-related charges; acquisition and integration-related costs; goodwill and intangible asset impairments; settlements, gains, losses and other charges; investment and debt-related gains and losses; and an adjustment of income taxes.
SELECTED GAAP RESULTS BY OPERATING SEGMENT
(In millions, except percentages)
(Unaudited)
Q1 Fiscal 2026
Q4 Fiscal 2025
Q1 Fiscal 2025
Sequential Change
Year-over-Year Change
Revenue
HPA
$
137.4
$
187.9
$
129.5
(26.9
)%
6.1
%
CSG
110.2
101.3
114.9
8.8
%
(4.1
)%
ACG
571.2
580.3
642.3
(1.6
)%
(11.1
)%
Total revenue
$
818.8
$
869.5
$
886.7
(5.8
)%
(7.7
)%
Operating income (loss)
HPA
$
21.6
$
58.4
$
4.9
(63.0
)%
340.8
%
CSG
(7.5
)
(15.6
)
(19.5
)
51.9
%
61.5
%
ACG
97.9
109.7
116.4
(10.8
)%
(15.9
)%
Unallocated amounts (1)
(81.9
)
(124.3
)
(97.2
)
34.1
%
15.7
%
Total operating income
$
30.1
$
28.2
$
4.6
6.7
%
554.3
%
Operating income (loss) as a % of revenue
HPA
15.7
%
31.1
%
3.8
%
(15.4
) ppt
11.9
ppt
CSG
(6.8
)
(15.4
)
(17.0
)
8.6
ppt
10.2
ppt
ACG
17.1
18.9
18.1
(1.8
) ppt
(1.0
) ppt
Total operating income as a % of revenue
3.7
%
3.3
%
0.5
%
0.4
ppt
3.2
ppt
(1) Includes stock-based compensation expense; amortization of acquired intangible assets; restructuring-related charges; acquisition and integration-related costs; goodwill and intangible asset impairments; settlements, gains, losses and other charges; costs associated with upgrading certain of the Company's core business systems; and start-up costs.
Non-GAAP Financial Measures
In addition to disclosing financial results calculated in accordance with United States (U.S.) generally accepted accounting principles (GAAP), this earnings release contains some or all of the following non-GAAP financial measures: (i) non-GAAP gross profit and gross margin, (ii) non-GAAP operating expenses, operating income and operating margin, (iii) non-GAAP net income, (iv) non-GAAP net income per diluted share, (v) free cash flow, (vi) EBITDA, (vii) non-GAAP return on invested capital (ROIC), and (viii) net debt or positive net cash. Each of these non-GAAP financial measures is either adjusted from GAAP results to exclude certain expenses or derived from multiple GAAP measures, which are outlined in the "Reconciliation of GAAP to Non-GAAP Financial Measures" tables, attached, and the "Additional Selected Non-GAAP Financial Measures and Reconciliations" tables, attached.
In managing Qorvo's business on a consolidated basis, management develops an annual operating plan, which is approved by our Board of Directors, using non-GAAP financial measures. In developing and monitoring performance against this plan, management considers the actual or potential impacts on these non-GAAP financial measures from actions taken to reduce costs with the goal of increasing gross margin and operating margin. In addition, management relies upon these non-GAAP financial measures to assess whether research and development efforts are at an appropriate level, and when making decisions about product spending, administrative budgets, and other operating expenses. Also, we believe that non-GAAP financial measures provide useful supplemental information to investors and enable investors to analyze the results of operations in the same way as management. We have chosen to provide this supplemental information to enable investors to perform additional comparisons of our operating results, to assess our liquidity and capital position and to analyze financial performance excluding the effect of expenses unrelated to operations, and stock-based compensation expense, which may obscure trends in Qorvo's underlying performance.
We believe that these non-GAAP financial measures offer an additional view of Qorvo's operations that, when coupled with the GAAP results and the reconciliations to corresponding GAAP financial measures, provide a more complete understanding of Qorvo's results of operations and the factors and trends affecting Qorvo's business. However, these non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, the corresponding measures calculated in accordance with GAAP.
Our rationale for using these non-GAAP financial measures, as well as their impact on the presentation of Qorvo's operations, are outlined below:
Non-GAAP gross profit and gross margin. Non-GAAP gross profit and gross margin exclude amortization of acquired intangible assets, stock-based compensation expense, restructuring-related charges, acquisition and integration-related costs, and certain other charges or income. We believe that exclusion of these costs in presenting non-GAAP gross profit and gross margin facilitates a useful evaluation of our historical performance and projected costs and the potential for realizing cost efficiencies.
We view amortization of acquired acquisition-related intangible assets, such as the amortization of the cost associated with an acquired company's research and development efforts, trade names, and customer relationships, as items arising from pre-acquisition activities, determined at the time of an acquisition, rather than ongoing costs of operating Qorvo's business. While these intangible assets are continually evaluated for impairment, amortization of the cost of purchased intangible assets is a static expense, which is not typically affected by operations during any particular period. Although we exclude the amortization of purchased intangible assets from these non-GAAP financial measures, management believes that it is important for investors to understand that such intangible assets were recorded as part of purchase price accounting and contribute to revenue generation.
We believe that presentation of non-GAAP gross profit and gross margin and other non-GAAP financial measures that exclude the impact of stock-based compensation expense assists management and investors in evaluating the period-over-period performance of Qorvo's ongoing operations because (i) the expenses are non-cash in nature, and (ii) although the size of the grants is within our control, the amount of expense varies depending on factors such as short-term fluctuations in stock price volatility and prevailing interest rates, which can be unrelated to the operational performance of Qorvo during the period in which the expense is incurred and generally are outside the control of management. Moreover, we believe that the exclusion of stock-based compensation expense in presenting non-GAAP gross profit and gross margin and other non-GAAP financial measures is useful to investors to understand the impact of the expensing of stock-based compensation to Qorvo's gross profit and gross margins and other financial measures in comparison to prior periods. We also believe that the adjustments to profit and margin related to restructuring-related charges, and acquisition and integration-related costs do not constitute part of Qorvo's ongoing operations and therefore the exclusion of these items provides management and investors with better visibility into the actual costs required to generate revenues over time and facilitates a useful evaluation of our historical and projected performance. We believe disclosure of non-GAAP gross profit and gross margin has economic substance because the excluded expenses do not represent continuing cash expenditures and, as described above, we have little control over the timing and amount of the expenses in question.
Non-GAAP operating expenses, operating income and operating margin. Non-GAAP operating expenses, operating income and operating margin exclude stock-based compensation expense, amortization of acquired intangible assets, acquisition and integration-related costs, goodwill and intangible asset impairments, restructuring-related charges and certain settlements, gains, losses and other charges. We believe that presentation of a measure of operating expenses, operating income and operating margin that excludes amortization of acquired intangible assets and stock-based compensation expense is useful to both management and investors for the same reasons as described above with respect to our use of non-GAAP gross profit and gross margin. We believe that acquisition and integration-related costs, goodwill and intangible asset impairments, restructuring-related charges and certain settlements, gains, losses and other charges do not constitute part of Qorvo's ongoing operations and therefore, the exclusion of these costs provides management and investors with better visibility into the actual costs required to generate revenues over time and facilitates a useful evaluation of our historical and projected performance. We believe disclosure of non-GAAP operating expenses, operating income and operating margin has economic substance because the excluded expenses are either unrelated to ongoing operations or do not represent current cash expenditures.
Non-GAAP net income and non-GAAP net income per diluted share. Non-GAAP net income and non-GAAP net income per diluted share exclude the effects of stock-based compensation expense, amortization of acquired intangible assets, acquisition and integration-related costs, goodwill and intangible asset impairments, restructuring-related charges, certain settlements, gains, losses and other charges, investment and debt-related gains and losses, and also reflect an adjustment of income taxes. The income tax adjustment primarily represents the use of research and development tax credit carryforwards, deferred tax expense (benefit) items not affecting taxes payable, adjustments related to the deemed and actual repatriation of historical foreign earnings, non-cash expense (benefit) related to uncertain tax positions and other items unrelated to the current fiscal year or that are not indicative of our ongoing business operations. We believe that presentation of measures of net income and net income per diluted share that exclude these items is useful to both management and investors for the reasons described above with respect to non-GAAP gross profit and gross margin and non-GAAP operating expenses, operating income and operating margin. We believe disclosure of non-GAAP net income and non-GAAP net income per diluted share has economic substance because the excluded expenses are either unrelated to ongoing operations or do not represent current cash expenditures.
Free cash flow. Qorvo defines free cash flow as net cash provided by operating activities during the period minus property and equipment expenditures made during the period, and free cash flow margin is calculated as free cash flow as a percentage of ...
