Companies /Technology

Semtech Corp

NASDAQ: SMTC Semiconductors
$132.15
▼ $0.81 (−0.61%) today
Markets closed · 4:19pm ET

Q1 2026 Earnings

Reported May 27, 2025, 4:08pm ET · SEC source
$0.38
Beat +2.54%
EPS · est. $0.37
$251.1M
Beat +0.40%
Revenue · est. $250.1M
+16.9%
Beating market
SMTC vs S&P since report
7 quarters
Consecutive EPS beats

Market Reaction

% change · around the report
−6%−3%0May 27May 28report 4:08pm ETearnings+0.7%−3.5%
−6%−3%0May 27May 28earnings+0.7%−3.5%
SMTC −3.5%S&P 500 +0.7%
−6%−3%0May 27May 28report 4:08pm ETearnings+1.2%−3.5%
−6%−3%0May 27May 28earnings+1.2%−3.5%
SMTC −3.5%NASDAQ +1.2%
−8%−4%0+4%May 27Jun 4report 4:08pm ETearnings+0.7%+1.9%
−8%−4%0+4%May 27Jun 4earnings+0.7%+1.9%
SMTC +1.9%S&P 500 +0.7%
−8%−4%0+4%May 27Jun 4report 4:08pm ETearnings+1.4%+1.9%
−8%−4%0+4%May 27Jun 4earnings+1.4%+1.9%
SMTC +1.9%NASDAQ +1.4%
−4.56%
Day of report
−3.38%
Next session
+3.62%
One week
+21.97%
30 days

S&P 500 over the same 30 days: +5.12%.

Did SMTC Beat Earnings? Q1 2026 Results

Semtech kicked off fiscal 2026 on a strong note, reporting first-quarter revenue of $251.10 million and non-GAAP adjusted EPS of $0.38, as the semiconductor and IoT connectivity company delivered 22% year-over-year top-line growth while dramatically improving its profitability profile. The key driver behind the earnings momentum was gross margin expansion to 52.3% from 48.3% a year ago, paired with disciplined cost management that pushed GAAP operating income to $36.00 million from just $3.10 million in the prior-year period. Deleveraging also played a meaningful role in the story, with net interest expense falling sharply to $6.20 million from $22.70 million a year earlier as the company executed principal prepayments on its term loan. Free cash flow turned solidly positive at $26.20 million, reversing a negative $1.40 million result from Q1 FY25. Looking ahead, management guided Q2 revenue to $256.00 million and non-GAAP adjusted EPS of $0.40, signaling continued sequential growth as Semtech balances investment in innovation with ongoing debt reduction priorities.

Key Takeaways
  • 22% year-over-year net sales growth
  • GAAP gross margin expanded to 52.3% from 48.3% year-over-year
  • Non-GAAP adjusted gross margin expanded to 53.5% from 49.8% year-over-year
  • Adjusted EBITDA margin improved to 22.1% from 16.1% year-over-year
  • GAAP net interest expense declined significantly to $6.2 million from $22.7 million year-over-year
  • Free cash flow improved to $26.2 million from negative $1.4 million year-over-year

“I am pleased with our solid first quarter results, that reflected improving demand trends, strong business fundamentals and disciplined execution in a dynamic environment. At the same time, we continue investing strategically in innovation, go-to-market capabilities, and operational scale—laying a strong foundation for sustained growth and long-term value creation.”

Semtech CEO, on the earnings call

Forward Guidance & Outlook

For Q2 FY2026, Semtech guided net sales of $256.0 million +/- $5.0 million, non-GAAP adjusted gross margin of 53.0% +/- 50 bps, adjusted operating expenses of $87.5 million +/- $1.0 million, adjusted operating income of $48.2 million +/- $3.0 million, adjusted diluted EPS of $0.40 +/- $0.03, and adjusted EBITDA of $56.0 million +/- $3.0 million. The company projects a 15% normalized non-GAAP tax rate for fiscal year 2026 and a non-GAAP diluted share count of 90.0 million.

SMTC YoY Financials

Revenue$251.1M
Gross Profit$131.3M
Operating Income$36.0M
Net Income$19.3M

SMTC Revenue by Segment

Signal Integrity$73.5M
Analog Mixed Signal and Wireless$90.6M
IoT Systems and Connectivity$86.9M

Figures from SEC filings and company reports. Not investment advice.