0000817720-26-000036
SEC filingRevenue up 10.4% YoY to $294.2M driven by Core IoT growth; gross margin improved 190 bps to 45.3%.
For the three months ended March 28, 2026, Synaptics reported net revenue of $294.2 million, up 10.4% from $266.6 million in the same quarter last year. The growth was driven primarily by a 30.8% increase in Core IoT revenue, while Enterprise and Automotive rose 9.2% and Mobile declined 16.3%. Gross margin improved to 45.3% from 43.4%, a 190 basis point expansion, due to favorable product mix, lower amortization of acquired intangibles, and a customer rebate liability release. Operating expenses as a percentage of revenue decreased to 49.6% from 53.3%, largely due to the absence of a prior-year intangible asset impairment charge of $13.8 million. Operating loss narrowed to $12.7 million from $26.3 million. Net loss improved to $8.0 million ($0.21 per share) from $21.8 million ($0.55 per share), benefiting from a higher tax benefit. For the nine-month period, revenue rose 12.3% to $889.2 million, but gross margin declined 150 basis points to 43.8% due to higher amortization of acquisition-related intangibles. Net loss for the nine months was $43.4 million, essentially flat year-over-year.
Enterprise and Automotive revenue increased 9.2% to $168.0 million, driven by 5.2% higher units sold and a customer rebate liability release, partially offset by a 1.7% decline in ASPs. Core IoT revenue surged 30.8% to $88.3 million, fueled by a 27.1% increase in units sold (including contributions from the Broadcom acquisition) and a 2.9% rise in ASPs. Mobile revenue fell 16.3% to $37.9 million, as units declined 5.7% and ASPs dropped 11.2% due to lower demand and unfavorable mix. The Core IoT segment is increasingly contributing to revenue mix, rising to 30.0% from 25.3% a year ago, while Mobile shrunk to 12.9% from 17.0%.
Management noted ongoing macroeconomic uncertainties, including geopolitical tensions and tariffs, but stated that based on current lead times and order activity, no material changes in order patterns have been observed. The company highlighted constrained availability of memory components but said it did not materially impact the quarter. Synaptics continues to focus on its Edge AI strategy and integration of audio, touch, and vision solutions. No specific quantitative guidance was provided. The company expects existing cash, operating cash flows, and the $350 million revolving credit facility to be sufficient for at least the next 12 months. Share repurchases totaled $82.6 million in the first nine months of fiscal 2026.
Operating cash flow (CFO) of $81.8M exceeded the net loss of $43.4M, driven by non-cash charges including share-based compensation ($115.1M), depreciation ($23.0M), and intangible amortization ($95.2M). However, working capital consumed $101.8M (accounts receivable +$32.2M, inventories +$20.8M, accounts payable -$18.9M, accrued liabilities -$34.2M), partially offset by other items. Capex increased to $35.7M from $19.2M, reflecting higher capital intensity. Free cash flow (not explicitly stated) was approximately $46.1M (CFO minus Capex), covering share repurchases of $82.6M only partially. Financing activities used $93.9M, primarily for share repurchases, with no debt issuance in the current period. Overall, cash generation remains solid but faces headwinds from working capital buildup and rising capex.