FormFactor (FORM) Q2 2026 earnings summary

Executive summary

• Achieved record Q2 2026 revenue of $258.2M, up 14.2% sequentially and 31.9% year-over-year, with gross margin at 53.3% and non-GAAP EPS at $0.82, all exceeding outlook ranges.

• Growth driven by high-performance compute, advanced packaging, and broad-based demand in DRAM, Foundry & Logic, and Systems segments.

• EPS tripled over the past four quarters, with significant margin expansion and robust cash flow.

• Expanded partnership with Keystone Microtech in Taiwan, enhancing regional assembly and service capabilities.

• Farmers Branch site on track to ramp in Q4 2026, supporting future growth and lower-cost capacity.

Financial highlights

• Q2 2026 revenue: $258.2M, up $32.1M (14%) sequentially and above outlook midpoint.

• Non-GAAP gross margin: 53.3%, up 430 bps sequentially and nearly 15 percentage points year-over-year.

• Non-GAAP net income: $65.0M ($0.82 per diluted share); GAAP net income: $56.2M ($0.71 per share).

• Free cash flow: $52.6M, up from $30.7M in Q1; cash and investments at $349M.

• Operating income rose to $57.8M in Q2 2026 from $16.6M in Q1 2026.

Outlook and guidance

• Q3 2026 revenue expected at $270M ± $10M; non-GAAP gross margin at 54% ± 1.5%; non-GAAP EPS at $0.86 ± $0.09.

• Q3 2026 GAAP gross margin expected at 52% ± 1.5%; GAAP EPS at $0.75 ± $0.09.

• Farmers Branch ramp to continue through 2027, with gross margin accretion expected by 2028.

• Target model aims to double revenue to $1.6B and more than double EPS by 2030.

• Management expects continued strong demand, especially in Foundry & Logic and Systems.