0001039399-26-000009
SEC filingRecord revenue $785M but net income fell 22% YoY due to prior-year gain; gross margin declined to 39.3% but improved in H2.
FormFactor, Inc. describes itself as a leading provider of electrical and optical test and measurement technologies along the full semiconductor product lifecycle—from characterization and modeling to production test. Founded in 1993, the company has grown through acquisitions to become a market leader with greater scale and diversification.
As of December 27, 2025, FormFactor operates in two reportable segments: Probe Cards and Systems. The Probe Cards segment includes sales of probe cards and analytical probes. The Systems segment includes sales of probe stations, thermal systems, and cryogenic systems. No revenue share by segment was disclosed in this section.
FormFactor designs, manufactures, and sells multiple product lines: probe cards (customized for customer-specific wafer and chip designs using MEMS technology, capable of over 150,000 contact elements with 40-micron spacing and testing at frequencies exceeding 80 GHz), analytical probes (over 50 models for engineering and production testing), probe stations (highly configurable for various measurement needs, including cryogenic and high-temperature testing), thermal subsystems (thermal chucks for precise temperature management), cryogenic systems (dilution refrigerator cryostats for quantum computing and other applications), and related services and support.
Products are sold worldwide through a global direct sales force, manufacturers’ representatives, and distributors. Customers include companies, universities, and institutions in foundry & logic, DRAM, flash, display, sensor, and quantum computer markets. Key customers with 10% or more of quarterly revenues include SK hynix (19.2% in Dec 2025), Intel (12.4% in Jun 2025), TSMC (10.4% in Jun 2025), and Samsung (12.4% in Mar 2024).
The probe card market is highly competitive with primary competitors including Japan Electronic Materials Corp., Korea Instrument Co., Micronics Japan, MPI Corp., STAr Technologies, Technoprobe, and TSE. In analytical probes, competitors are GGB Industries and MPI. Probe station competitors include MPI, Semishare, STAr, TEL, and Wentworth. Thermal subsystem competitors include AEM, ERS, and Temptronic. Cryogenic system competitors include Bluefors, Lake Shore, Maybell, Montana Instruments, and Quantum Design. Competitive factors vary by product but include customer service, design success, delivery time, price, performance, and signal integrity.
FormFactor’s strategy includes investing considerable resources in proprietary probe card design tools and processes to enable rapid customization. The company continues to evaluate opportunities to acquire businesses and technologies. Significant R&D resources are allocated to prepare for next-generation electrical test and measurement challenges. The company leverages ongoing investments across all advanced probe card markets to achieve synergies and economies of scale, improving competitiveness, time-to-market, and profitability.
As of December 27, 2025, FormFactor had 2,153 regular full-time employees: 1,298 in operations, 422 in R&D, 235 in sales and marketing, and 198 in general and administrative functions. By region, 1,553 employees were in North America, 325 in Asia, and 275 in Europe. The Probe Cards segment had 1,579 employees, the Systems segment had 377, and corporate functions had 197. The company emphasizes talent acquisition, retention, and development through compensation programs, learning opportunities, and diversity initiatives.
FormFactor reported record revenue of $785.0M in fiscal 2025, up 2.8% from $763.6M in fiscal 2024. Net income declined to $54.4M from $69.6M, largely due to the absence of a $20.6M gain on the sale of China operations in the prior year. Gross margin contracted 100 basis points to 39.3%, primarily driven by higher manufacturing costs including a 1.4% headwind from tariffs. However, margins improved sequentially in the second half of fiscal 2025. Operating margin fell to 7.2% from 8.5%, impacted by $3M in factory start-up costs and higher restructuring charges.
Probe Cards revenue grew 1.9% to $637.9M, propelled by DRAM probe cards (+8.8% to $247.4M) driven by HBM demand for AI, while Foundry & Logic declined 3.0% to $369.9M due to weaker PC/server designs. Systems revenue increased 6.9% to $147.1M, with growth across thermal systems, probe stations, and cryogenic systems. Geographically, South Korea and Taiwan saw strong gains (+28.8% and +16.9% respectively), while China declined 43.7% due to trade restrictions.
Management highlighted several strategic initiatives: a restructuring plan to consolidate manufacturing in Carlsbad and Baldwin Park, with expected cost savings; the acquisition of Keystone Photonics to strengthen AI infrastructure positioning; and a new manufacturing site in Texas with an expected production ramp in late fiscal 2026. Capital expenditures are guided at $140-170M for the Texas ramp, and factory start-up costs are expected to be $20-25M in fiscal 2026. The company remains focused on margin improvement through cost structure alignment and favorable mix shifts toward higher-growth DRAM and AI-related end markets.
As of December 27, 2025, FormFactor held $103.3M in cash and equivalents and $171.8M in marketable securities, totaling $275.1M in liquidity. Total debt was $12.2M (term loan), with a new $150M undrawn revolver. Shareholders' equity stood at $1,035.4M. Inventory increased to $110.9M, with $14.9M in obsolescence charges.
Remaining performance obligations (RPO) were $30.3M, with 63.7% expected in fiscal 2026. Operating lease liabilities totaled $20.2M. No material purchase commitments were disclosed beyond routine leases and the $18M California grant deferred.
During fiscal 2025, FormFactor repurchased 800,000 shares for $26.2M. A new $75M buyback program was authorized on April 24, 2025, with $70.9M remaining. No dividends were declared. Debt repayments were $1.1M, and capex reached $103.7M (13.2% of sales), supported by $8.7M in CHIPS Act credits.
Probe Cards segment generated $637.9M revenue (81.3% of total) and net contribution of $136.6M (21.4% margin). Systems segment contributed $147.1M revenue (18.7%) and $20.3M net contribution (13.8% margin). Geographically, South Korea (30.3%), Taiwan (25.8%), and the U.S. (19.4%) were the top regions. Foundry & Logic accounted for $369.9M of revenue, DRAM $247.4M, and Flash $20.6M.
The provided document does not include the actual cash flow statement figures. The statement references the Consolidated Statements of Cash Flows but only lists page numbers and exhibit indices. No numerical data is available for analysis. Therefore, cash flow quality, CFO vs Net Income, capex intensity, FCF coverage, and anomalies cannot be assessed.