Qorvo (QRVO) Q2 2025 earnings summary

Executive summary

• Fiscal Q2 2025 revenue was $1.047 billion, up 18% sequentially but down 5.2% year-over-year, with double-digit growth in all segments except ACG, which faced headwinds from Android mix shift.

• Non-GAAP gross margin reached 47% and non-GAAP EPS was $1.88, both above guidance midpoints; GAAP gross margin was 42.6% and net loss per share was $0.18, impacted by restructuring and goodwill impairment.

• Growth in HPA and CSG segments is expected in the mid-teens for FY25, while ACG faces ongoing pressure from Android 5G mix shift to entry-tier.

• Strategic focus remains on flagship/premium smartphones, defense, aerospace, automotive, and connectivity markets.

• Operating income dropped to $9.7 million from $151.4 million year-over-year, reflecting lower gross profit and $96.5 million goodwill impairment.

Financial highlights

• Revenue of $1.047 billion, up 18% sequentially but down 5.2% year-over-year.

• Non-GAAP gross margin was 47%; GAAP gross margin 42.6%; non-GAAP operating expenses at $280 million.

• Free cash flow was $94.8 million; operating cash flow $127.8 million; capex $33 million.

• Cash and cash equivalents at quarter end were $1.10 billion; long-term debt $1.96 billion.

• Inventory at $694 million, lowest in three years, down $32 million sequentially and $145 million year-over-year.

Outlook and guidance

• Next quarter revenue expected at ~$900 million (+/- $25 million), non-GAAP gross margin ~45%, EPS $1.10–$1.30.

• Fiscal 2025 revenue and gross margin projected to be slightly down year-over-year due to Android mix shift and flagship model variability.

• Non-GAAP operating expenses for December quarter expected at ~$265 million; digital transformation spend ~$15 million.

• Non-GAAP tax rate for FY25 expected at 10–12%, projected to rise over time.

• Long-term gross margin target remains 50%+, with near-term pressure from Android entry-tier mix.