<div id="readability-page-1">News: Microelectronics For its fiscal first-quarter 2025 (ended 29 June 2024), Qorvo has reported a further decline in revenue to $886.7m, down 5.8% on last quarter’s $941m but up 36% on $651.2m a year ago, and exceeding the $850m mid-point of guidance by $37m. Revenue is dominated more than ever by Qorvo’s increasing exposure to the seasonal ramp patterns at its two largest customers Apple and Samsung, leading to a decline in Advanced Cellular Group (ACG) revenue. “We’re coming off a big flagship ramp at our second largest customer with tremendous content,” notes president &amp; CEO Bob Bruggeworth. “We’re offsetting that with growth outside of them.” By business segment, revenue comprised: <ul> <li>Advanced Cellular Group (ACG) $642.3m, down 1.7% on last quarter’s $653.6m but up 55.8% on $412.2m a year ago; </li> <li>Connectivity &amp; Sensors Group (CSG) $114.9m, down 6.4% on last quarter’s $122.8m but up 15.7% on $99.3m a year ago; </li> <li>High-Performance Analog (HPA) $129.5m, down 21.3% on last quarter’s $164.6m and 7.3% on $139.7m a year ago, due to the seasonal timing of large programs for defense (given its dominant size within HPA), together with a slower rollout of DOCSIS 4.0. </li> </ul> On a non-GAAP basis, gross margin has fallen further, from 42.9% a year ago and 42.5% last quarter to 40.9%, including about 200 basis points of impact from under-utilization. As well as the typical seasonal decline in Qorvo’s largest customer (comprising products that contain higher levels of external content) plus the seasonal decline in defense programs, this reflects a higher percentage of high-cost Android 5G mass-market product that was manufactured during periods of lower utilization. However, gross margin is at the high end of the 40–41% guidance range, benefiting from product mix on higher revenue. “Given anticipated product mix and production schedules, we currently believe fiscal Q1 will mark the low point of gross margin in fiscal 2025,” says senior VP &amp; chief financial officer Grant Brown. Operating expenses have grown further, from $232.7m a year ago and $253.2m last quarter to $264.5m (above the expected $260m). This was driven partly by R&amp;D spending rising from $168.1m last quarter to $174.9m, but also included $4m from Qorvo’s digital transformation project (a three-year initiative to modernize the firm’s core systems and business processes, to increase operational efficiency, unlock internal data to leverage new software capabilities including AI, and support broad-based growth objectives in diverse dynamic markets.). Net income was $83.5m ($0.87 per diluted share, exceeding the $0.60–0.80 guidance due to the higher revenue and gross margin, offset by the slightly higher operating expenses). This was down from $135.5m ($1.39 per diluted share) last quarter but up from just $33.6m ($0.34 per diluted share) a year ago. “Qorvo exceeded the mid-point of June quarterly guidance for revenue, gross margin and EPS,” notes Brown. Operating cash flow has fallen from $202.3m last quarter to $81.1m. Capital expenditure (CapEx) has risen further, from $32.7m to $38.2m. Free cash flow was hence $42.9m (down from $169.6m). During the quarter, cash and equivalents rose by $53.1m, from $1029.3m to $1082.4bn. Long-term debt outstanding remains about $1549bn. Also during the quarter, Qorvo repurchased $125m of stock at $101 per share. In addition, Qorvo retired $27m of its 2024 notes and has about $412m remaining. These notes will mature in mid-December. Subject to changes in the interest rate environment and other factors, Qorvo currently expect to retire these short-term notes later this year. Net inventory balance was increased back up to $727m (after dipping to $710.5m last quarter), as Qorvo supports the seasonal ramp at its largest customer. <h2>Acquisition Anokiwave fully integrated into Qorvo’s HPA segment </h2> Anokiwave Inc of Boston, MA, USA (acquired during the June quarter) has now been fully integrated into Qorvo’s HPA segment. “Added capabilities in silicon beam-forming ICs and IF-to-RF conversion [e.g. for SATCOM, D&amp;A, and 5G applications] are complementary to our transmit/receive RF front-ends as well as our power management IC portfolio,” says Bruggeworth. “We are developing more highly integrated placements that combine our capabilities to bring greater value-add to our customers,” he adds. “We are investing in technology leadership to broaden our market exposure and drive growth, and we are executing on cost and productivity initiatives to structurally enhance our gross margin.” <h2>Beijing and Dezhou packaging operations transitioned to Luxshare; </h2> “We are leveraging internal factories and advanced packaging facilities that are critical differentiators for each of our operating segments, while outsourcing to our robust foundry and OSAT [outsourced semiconductor assembly and test] partner network where we benefit from their scale and R&amp;D investments,” says Brown. In mid-December, Qorvo said that it was divesting its assembly &amp; test facilities in Beijing and Dezhou, China, via a new multi-year partnership with Luxshare Precision Industry Co Ltd of Dongguan City, Guangdong (which acquired their operations and assets, including the property, plant and equipment, as well as the existing workforce to enable continuity of operations). After completing the sale during the June quarter, Qorvo continues to maintain its sales, product and test engineering, and customer support staff in China. These divestments align with previous actions, including the closure of Qorvo’s Florida manufacturing operations and the sale of its Farmers Branch facility in Texas. Also, Qorvo has now completed the transition of its BAW filter production lines to exclusively 8-inch wafers, and running product through the Beijing and Dezhou facilities. <h2>Strategic highlights during June quarter </h2> <ul type="disc"> <li> Qorvo was selected to supply V2X front-end modules (FEMs) for a leading China-based automotive V2X reference chipset platform set to ramp at multiple automotive OEMs in calendar 2025. To expand automotive engagements, the firm is leveraging its ultra-wideband portfolio across a range of applications, including secure access, digital key, kick sensors, child presence detection and detection of intrusion. “We are also expanding our opportunities in EVs to include solid-state circuit breakers,” notes Bruggeworth. “Given the smaller size, enhanced reliability and better thermals of our silicon carbide solutions, we enable solid-state circuit breakers that can disconnect electrical overloads in case of failure to maintain safe and efficient power distribution,” he adds. </li> </ul> <ul type="disc"> <li> Qorvo secured a new engagement to supply a switch mode DC-to-DC charger for a wearable accessory for an Android OEM. “We continue to expand our power management portfolio and we are engaged to supply our newest battery management solution for power tools, scooters, e-bikes and other consumer products,” says Bruggeworth. Qorvo is also supporting a range of applicants with its Matter and ultra-wideband technologies, including door locks, smart lighting and indoor navigation. “We are combining Matter with ultra-wideband to support the emerging Aliro standard for controlling digital access to smart homes and offices,” notes Bruggeworth. To support global broadband deployments, Qorvo’s Wi-Fi solutions enable cellular, cable and satellite backhaul applications in developed and emerging markets. Qorvo recently surpassed 75 million Wi-Fi 6 FEMs shipped into the India Wi-Fi market. “We continue to expand our Wi-Fi portfolio and we are seeing increasing customer interest in our 2GHz, 5GHz and 6GHz BAW filters for Wi-Fi CPE applications,” says Bruggeworth. “In other consumer applications, we are expanding our customer engagements with four sensing touch sensors, primarily for laptop track pads as well as other consumer applications.” </li> </ul> <ul type="disc"> <li> Qorvo secured design wins across segments, including AESA radars, large defense programs, and SATCOM deployments where Qorvo participates in both the low Earth orbit (LEO) satellite and the ground-based consumer terminal. In D&amp;A markets, Qorvo is the beneficiary of underlying drivers, including the trend of one-to-many, the transition of mechanical systems to active electronic scanning systems, increasing system-level functionality, and size constraints requiring advanced multi-chip packaging. New product launches during the quarter included three new highly integrated RF multi-chip modules (MCMs) for X-band, S-band and L-band advanced radar applications. The new modules integrate filters, switches and amplifiers to simplify design and enable a superior performance, low noise, reduced power consumption and smaller form factor required for phased-array and multi-function radar systems. </li> </ul> <ul type="disc"> <li> Qorvo launched a single-chip inverse cable equalizer that is programmable in the field and electronically simulates signal loss at various cable lengths. For operators, this eliminates the additional parts and tech time required to accommodate short runs during DOCSIS 4.0 field installations. Qorvo’s single-chip solution also features a switched bypass mode that allows operators to utilize the firm’s solution in every line amplifier and field extender regardless of distance. For massive MIMO 5G base stations, Qorvo introduced what is claimed to be a best-in-class transmit pre-driver, engineered specifically for 32-node massive MIMO systems and scalable up to 64-nodes. </li> </ul> <ul type="disc"> <li> Qorvo is seeing continued demand for new orders for AC-to-DC high-density server power supplies. During the quarter, Qorvo began sampling what is claimed to be the industry’s first 4mΩ silicon carbide JFET, with best-in-class on-resistance (RDS(ON)) among 650–750V power devices. “This is especially important for applications such as circuit protection that are migrating from traditional switch mode static switches that are on for longer durations,” notes Bruggeworth. “This is a significant milestone for solid-state circuit breakers and it highlights the trend we are seeing from mechanical to semiconductor-based electrical systems for residential, commercial and industrial applications.” For Wi-Fi enterprise access points, Qorvo is engaged to supply ultra-wideband to enable indoor navigation in office buildings, shopping malls and factories. “By adding ultra-wideband to Wi-Fi access points, the access points become the anchor or reference point, enabling precision navigation for ultra-wideband-enabled devices,” says Bruggeworth. “As an added benefit, ultra-wideband can reduce costs by identifying the optimal location for access point placement during Wi-Fi installation,” he adds. “Lastly, we’re leveraging our force-sensing touch sensor technology in new industrial markets, including handheld medical devices that measure oxygen levels.” </li> </ul> <ul type="disc"> <li> Qorvo’s largest opportunity remains at its largest customer. “We are investing in multiple multi-year programs to increase our content and continue to grow revenue with this customer,” says Bruggeworth. R&amp;D investments for future programs include products that Qorvo is currently supplying to this customer as well as new products that it is not currently supplying. Within the Android ecosystem, Qorvo remains the primary RF supplier. “We collaborate with Android OEMs on their product roadmaps over multiple years and we are positioned to drive growth as 4G devices move to 5G and enter our SAM [serviceable addressable market],” says Bruggeworth. “In calendar 2024, we expect Android 5G unit volumes to grow greater than 10%. We are also positioned to grow with 5G Advanced, which occurs with new releases of the 5G standard,” he adds. “Content drivers in 5G events include an additional transmit path, non-terrestrial network connectivity and requirements for Power Class 2 amplifiers to increase output power, improve data throughput and extend cell site coverage.” During the quarter, Qorvo ramped multiple new products, leveraging its newest BAW and LRT (low-loss resonator technology) SAW processes. “For an Android OEM, we commenced shipments of the most functionally dense mid-high band [MHB] PAD [power amplifier duplexer] on the market,” says Bruggeworth. The new MHB PAD integrates the diversity receive content that was historically offered in a separate SAW-based module. It is a highly complex MCM that features Qorvo’s internal BAW, LRT SAW and gallium arsenide (GaAs) heterojunction bipolar transistor (HBT) as well as CMOS and silicon-on-insulator (SOI) sourced from Qorvo’s foundry network. It improves efficiency and reduces power consumption while shrinking board-space requirements by about 35%. Within mass-market smartphones, Qorvo secured multiple design wins with its recently launched portfolio of low-, mid-, high-band PADs. Each LMH PAD integrates the low-, mid- and high-band main-path content that previously required two placements. This saves about 40% in board space, simplifies design and helps customers accelerate their time to market, reckons Qorvo. In mobile Wi-Fi, MediaTek selected Qorvo as the exclusive supplier of Wi-Fi 7 FEMs for customers of their DX4 Wi-Fi chipset. MediaTek’s DX4 chipset and Qorvo’s Wi-Fi 7 FEMs are optimized to deliver superior performance for flagship and mass-market smartphones, Qorvo says. Qorvo also expanded its ultra-wideband wins in the Android ecosystem to include an additional handset customer. Motorola’s Moto X50 Ultra, which launched in the June quarter, features Qorvo’s ultra-wideband system-on-a-chip (SoC). “This is our first win in a mid-tier smartphone and is an early indicator of ultra-widebands proliferating across mass-market smartphone portfolios,” says Bruggeworth. </li> </ul> <h2>Outlook – sequential increases in revenue, gross margin and EPS </h2> For its fiscal second-quarter 2025 (to end-September 2024), Qorvo expects revenue to rise sequentially to $1.025bn (plus or minus $25m), although this will still be down slightly year-on-year due mainly to a hiatus in Android smartphone revenues, following ramps in first-half calendar 2024 for key models including both Samsung’s S24 (involving over $5 of content) and Google’s Pixel ($15 of content). Gross margin should recover to 46–47%, due mainly to the product mix (since inventories of higher-cost Android 5G mass-market product have sold through, mostly by end-June) but also aided by the impact of under-utilization lessening to about 100 basis points or less (then becoming negligible for the second half of the fiscal year). “The September quarter and, to a lesser degree, December quarter will benefit from a higher mix of customized solutions for flagship-tier phones,” says Brown. “That product mix generally includes a higher amount of externally sourced silicon and SOI [silicon-on-insulator] content. It is not impacted by internal utilization levels,” he adds. “That compares to our prior two quarters where revenue was comprised of a larger mix of high-cost standard products that were burdened by prior periods of underutilization.” Operating expenses are projected to rise sequentially by $10.5m to $275m, driven mainly by about $10m from the firm’s digital transformation. “During fiscal 2025, we continue to expect about $40m of expense related to this project,” says Brown. <div>Diluted earnings per share should more than double to $1.75–1.95 for the September quarter. </div> Qorvo adds RF multi-chip modules for advanced radar applications Qorvo adds three compact MMIC power amplifiers for Ku-band SATCOM terminals Qorvo launches first 4mΩ SiC JFET in TOLL package Qorvo grows year-on-year after content gains with largest mobile customers and record defense revenue Qorvo’s quarterly revenue up 44.5% year-on-year Qorvo to acquire Anokiwave Qorvo sells Beijing and Dezhou assembly &amp; test facilities to contract manufacturer Luxshare Qorvo’s June-quarter revenue down less than expected, as Android consumer-related inventory consumption offset by growth in defense &amp; aerospace and automotive Qorvo www.qorvo.com </div>

QRVO

Qorvo reported a decline in revenue for its fiscal first quarter, driven by a decrease in Advanced Cellular Group (ACG) revenue. However, the company exceeded its guidance and saw growth in other segments. Gross margin fell but was at the high end of the guidance range. Operating expenses increased, and net income was down from the previous quarter but up from a year ago. The company's operating cash flow and free cash flow decreased, while capital expenditure and cash and equivalents increased. Qorvo also repurchased stock and retired some of its notes. The company's acquisition of Anokiwave has been fully integrated into its High-Performance Analog (HPA) segment. Qorvo's Beijing and Dezhou packaging operations have transitioned to Luxshare.

Qorvo’s below-seasonal June-quarter revenue follows major ramp at Samsung