Qorvo’s third quarter results drew a muted market reaction, with investors digesting management’s focus on business restructuring and a pivot away from lower-margin Android products. Management attributed stable operating results to ongoing cost reductions, a strategic shift toward higher-value segments, and improvements in manufacturing efficiency. CEO Robert Bruggeworth stated, “We are restructuring to increase our focus on our top opportunities and improve profitability,” referencing efforts to streamline product lines and exit underperforming markets. Key drivers included content growth at the company’s largest customer and margin expansion from operational changes.
Is now the time to buy QRVO? Find out in our full research report (it’s free for active Edge members).
Qorvo (QRVO) Q3 CY2025 Highlights:
- Revenue: $1.06 billion vs analyst estimates of $1.04 billion (1.1% year-on-year growth, 1.9% beat)
- Adjusted EPS: $2.22 vs analyst estimates of $2.11 (5.1% beat)
- Adjusted EBITDA: $291.4 million vs analyst estimates of $288.2 million (27.5% margin, 1.1% beat)
- Revenue Guidance for Q4 CY2025 is $985 billion at the midpoint, above analyst estimates of $990.9 million
- Adjusted EPS guidance for Q4 CY2025 is $1.85 at the midpoint, below analyst estimates of $1.87
- Operating Margin: 14.9%, up from 0.9% in the same quarter last year
- Inventory Days Outstanding: 99, down from 120 in the previous quarter
- Market Capitalization: $7.94 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Qorvo’s Q3 Earnings Call
- Karl Ackerman (BNP Paribas) questioned the accelerated $200 million decline in Android revenue. Senior Vice President Dave Fullwood explained it is driven by timing of mass-tier product ramp-downs and lower content in future flagship launches.
- Christopher Caso (Wolfe Research) asked about expected seasonality for the March quarter and the impact on gross margins. CFO Grant Brown indicated normal seasonal declines but highlighted that product mix and factory actions should strengthen margins year-over-year.
- Harsh Kumar (Piper Sandler) sought clarity on the scale and drivers of the defense and aerospace business. Vice President Philip Chesley described broad-based growth in radar, drones, and electronic warfare, with new U.S. and NATO programs fueling demand.
- James Schneider (Goldman Sachs) inquired about inventory trends and cyclical effects in the defense segment. Chesley reported healthy channel inventory and strong demand, especially in power management for data centers.
- Peter Peng (JPMorgan) requested details on content growth at the largest customer and updates on the CSG restructuring. Management confirmed growth across all major product categories and signaled CSG would likely remain flat due to restructuring impacts.
Catalysts in Upcoming Quarters
Going forward, the StockStory team will watch (1) the pace of defense and aerospace growth, especially as new U.S. and European programs ramp; (2) progress on restructuring and cost reductions within CSG and manufacturing; and (3) additional gains in gross margin as product mix shifts to higher-value segments. Adoption of WiFi 7 and ultra-wideband technology will also be key indicators of Qorvo’s ability to diversify beyond mobile.
Qorvo currently trades at $85.90, down from $93.70 just before the earnings. At this price, is it a buy or sell? See for yourself in our full research report (it’s free for active Edge members).
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