It has been about a month since the last earnings report for Qorvo (QRVO). Shares have added about 6.7% in that time frame, outperforming the S&P 500.
But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Qorvo due for a pullback? Well, first let's take a quick look at its most recent earnings report in order to get a better handle on the recent drivers for Qorvo, Inc. before we dive into how investors and analysts have reacted as of late.
Qorvo Q3 Earnings Surpass Estimates on Solid Revenue Growth
Qorvo reported strong third-quarter fiscal 2026 results, with both adjusted earnings and revenues surpassing the Zacks Consensus Estimate.
During the quarter, the company’s strong growth was driven by content gains, focus on higher-margin flagship smartphones, an improved product mix, growth in Wi-Fi and automotive ultra-wideband, steady HPA demand, and efficiency gains from restructuring, all of which boosted margins and profitability.
Net Income
On a GAAP basis, the company reported a net income of $164.1 million or $1.75 per share compared with a net income of $41.3 million or 43 cents per share in the prior-year quarter. Top-line growth and lower operating expenses boosted the bottom line during the quarter.
Non-GAAP net income was $203.2 million or $2.17 per share compared with $152.8 million or $1.61 per share in the year-ago quarter. The bottom line surpassed the Zacks Consensus Estimate by 30 cents.
Revenues
Net sales during the quarter improved to $993 million from $916.3 million in the prior-year quarter, driven by a new high-band pad win in cellular-enabled iPads and strong demand for flagship and premium smartphones. In addition, early production orders in automotive ultra-wideband programs and steady demand across defense, aerospace, and infrastructure markets buoyed the revenues. The top line beat the Zacks Consensus Estimate of $991.3 million.
Segmental Performance
The High-Performance Analog (HPA) segment contributed $190.9 million in revenues compared with $171.7 million in the year-ago quarter, largely driven by strong demand across defense, aerospace, satellite, power, and infrastructure markets. The segment continues to benefit from multiyear tailwinds in D&A, data power, and infrastructure end markets.
Revenues from the Connectivity and Sensors Group (CSG) segment were $111.3 million compared with $109.5 million in the year-earlier quarter, driven by broad Wi-Fi adoption and growth in industrial, enterprise, and other end markets. Net sales in the Advanced Cellular Group (ACG) segment were $690.8 million, up 8.8% year over year, backed by growth in the premium smartphone segment.
Other Details
Non-GAAP gross profit was $487.5 million compared with $426.3 million in the year-ago quarter, with respective margins of 49.1% and 46.5%. Non-GAAP operating expenses decreased to $239.9 million from $248.4 million a year ago. Non-GAAP operating income was $247.6 million compared with $177.9 million in the year-ago quarter.
Cash Flow & Liquidity
As of Dec. 27, 2025, QRVO had $1.3 billion in cash and cash equivalents and $1.55 billion of long-term debt. The company generated $265.4 million in net cash from operating activities in the quarter, with a free cash flow of $236.9 million.
Outlook
For fourth-quarter fiscal 2026, the company expects revenues to be $800 million (+/- $25 million). Non-GAAP gross margin is projected to be in the range of 48-49%. Non-GAAP earnings are expected to be $1.20 per share (+/- 15 cents).
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review.
VGM Scores
Currently, Qorvo has a nice Growth Score of B, however its Momentum Score is doing a bit better with an A. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, Qorvo has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Qorvo, Inc. (QRVO): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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