Qorvo (QRVO) Q1 2025 earnings summary

Executive summary

• Revenue for Q1 FY2025 was $887 million, up 36% year-over-year and surpassing guidance midpoint by $37 million, driven by content gains at the largest customer and higher Android shipments.

• Strategic focus on technology upgrades, product integration, and expanding content in flagship and mass-market devices, especially in mobile and automotive sectors.

• Operational excellence highlighted by migration to 8-inch BAW wafer production, integration of Anokiwave, and transition of Beijing and Dezhou operations to Luxshare.

• GAAP gross margin was 37.5% and non-GAAP gross margin was 40.9%; operating income was $4.6 million GAAP and $98.1 million non-GAAP.

• Diluted EPS was $0.00 GAAP and $0.87 non-GAAP; net income was $0.4 million GAAP and $83.5 million non-GAAP.

Financial highlights

• Q1 FY2025 revenue: $887 million, up from $651.2 million year-over-year.

• Non-GAAP gross margin was 40.9%, at the high end of guidance; GAAP gross margin was 37.5%.

• Operating cash flow was $81 million; free cash flow was $43 million after $38 million in CapEx.

• Cash and equivalents were $1.1 billion; long-term debt was $1.5 billion; $27 million of 2024 notes retired, $412 million remaining.

• Repurchased $125 million of stock at $101 per share; 1.2 million shares repurchased, $1.18 billion remains authorized.

Outlook and guidance

• Q2 FY2025 revenue expected at $1.025 billion ±$25 million; non-GAAP gross margin 46%-47%; non-GAAP EPS $1.75-$1.95.

• Gross margin expected to improve through FY2025, with Q1 as the low point.

• Non-GAAP operating expenses projected at $275 million for Q2, with $10 million related to digital transformation.

• Non-GAAP tax rate for FY2025 expected at 10%-12%, with potential increases due to tax legislation.

• Sequential increases in revenue, gross margin, and EPS anticipated.