Q2 2026 Cirrus Logic Inc Earnings Call

November 4, 2025

Speaker #1: Ladies and gentlemen , thank you for standing by . Welcome to the CIRRUS LOGIC, INC. second quarter Fiscal Year 2026 Financial Results Q&A session .

Operator: Ladies and gentlemen, thank you for standing by. Welcome to the Cirrus Logic Q2 fiscal year 2026 financial results Q&A session. At this time, all participants are in a listen-only mode. After a brief statement, we will open up the call for questions from analysts. Instructions for queuing up will be provided at that time. As a reminder, this conference call is being recorded for replay purposes. I would now like to turn the conference call over to Ms. Chelsea Heffernan, Vice President of Investor Relations. Ms. Heffernan, you may begin.

Speaker #1: At this time , all participants are in a listen only mode . After a brief statement , we will open up the call for questions from analysts .

Speaker #1: Instructions for queuing up will be provided at that time . As a reminder , this conference being recorded for replay purposes . I would now like to turn the conference call over to Miss Chelsea Heffernan , Vice President of Investor Relations .

Speaker #1: Miss Heffernan . You may begin .

Speaker #2: Thank you and good afternoon . Joining me on today's call is John CIRRUS LOGIC, INC. , chief Executive Officer and Jeffrey Woolard , our chief Financial officer .

Chelsea Heffernan: Thank you and good afternoon. Joining me on today's call is John Forsyth, Cirrus Logic's Chief Executive Officer, and Jeff Woolard, our Chief Financial Officer. Today, at approximately 4:00PM Eastern Time, we announced our financial results for Q2 fiscal 2026. The shareholder letter discussing our financial results, the earnings press release, and the webcast of this Q&A session are all available at the company's investor relations website. This call will feature questions from the analysts covering our company. Additionally, the results and guidance we will discuss on this call will include non-GAAP financial measures that exclude certain items. Reconciliations of these non-GAAP measures to their most directly comparable GAAP measures are included in our earnings release and are all available on the company's investor relations website.

Speaker #2: Today , at approximately 4 p.m. Eastern Time , we announced our financial results for the second quarter of fiscal 26 . The shareholder letter discussing our financial results , the earnings press release and the webcast of this Q&A session are all available at the company's Investor Relations website .

Speaker #2: This call will feature questions from the analysts covering our company . Additionally , the results and guidance we will discuss on this

Chelsea Heffernan: This call will feature questions from the analysts covering our company. Additionally, the results and guidance we will discuss on this call will include non-GAAP financial measures that exclude certain items. Reconciliations of these non-GAAP measures to their most directly comparable GAAP measures are included in our earnings release and are all available on the company's investor relations website.

Speaker #2: call will include non-GAAP financial measures that exclude call is certain items . Reconciliations of these non-GAAP measures to their most directly comparable GAAP measures are included in our earnings release and are all available on the company's Investor Relations website .

Speaker #2: Please note that during this session , we may make projections and other forward looking statements that are subject to risks and uncertainties that may cause actual results to differ materially from projections .

Chelsea Heffernan: Please note that during this session, we may make projections and other forward-looking statements that are subject to risks and uncertainties that may cause actual results to differ materially from projections. By providing this information, the company expressly disclaims any obligation to update or revise any projections or forward-looking statements, whether as a result of new developments or otherwise. Please refer to the press release and shareholder letter issued today, which are available on the Cirrus Logic website and the latest Form 10-K, as well as other corporate filings registered with the Securities and Exchange Commission for additional discussion of risk factors that could cause actual results to differ materially from current expectations. Now I'd like to turn the call over to John.

Speaker #2: By providing this information , the company expressly disclaims any obligation to update or revise any projections or forward looking statements , whether as a result of new developments or otherwise .

Speaker #2: Please refer to the press release and shareholder letter issued today , which are available on the website and the latest form 10-K , as well as other corporate filings registered with the Securities and Exchange Commission .

Chelsea Heffernan: Please refer to the press release and shareholder letter issued today, which are available on the Cirrus Logic website and the latest Form 10-K, as well as other corporate filings registered with the Securities and Exchange Commission for additional discussion of risk factors that could cause actual results to differ materially from current expectations. Now I'd like to turn the call over to John.

Speaker #2: For additional discussion of risk factors that could cause actual results to differ materially from current expectations . Now , I'd like to turn the call over to John .

Speaker #3: Thank you . Chelsea , and welcome to everyone joining today's call . As you've seen in the press release , Cirrus delivered record September quarter revenue of $561 million towards the top end of our guidance range , driven by demand for components , shipping into smartphones .

John Forsyth: Thank you, Chelsea, and welcome to everyone joining today's call. As you've seen in the press release, Cirrus Logic delivered record September quarter revenue of $561 million towards the top end of our guidance range, driven by demand for components shipping into smartphones. In a few moments, I'll hand the call over to Jeff to discuss the financial results for the September quarter in detail, along with our outlook for the December quarter. Before we get to that, I'd like to make a few comments about the recent progress we have been making across key areas of our business. As we have outlined previously, our long-term strategy for growth at Cirrus is based around three principles. First, we seek to maintain a strong leadership position in our core flagship smartphone audio business.

Speaker #3: few moments , I'll hand the call over to Jeff to discuss the financial results for the September quarter in detail , along with our outlook for the December quarter .

John Forsyth: Before we get to that, I'd like to make a few comments about the recent progress we have been making across key areas of our business. As we have outlined previously, our long-term strategy for growth at Cirrus is based around three principles. First, we seek to maintain a strong leadership position in our core flagship smartphone audio business.

John Forsyth: Second, we aim to expand the value and range of high-performance mixed-signal solutions with which we serve our customers in smartphones and similar products. And third, we aim to leverage our world-class expertise and IP in both audio and high-performance mixed-signal to grow and broaden our business in new markets. I want to say a few words now about the progress we've made in the past quarter in each of these areas. In our flagship smartphone audio business, during the quarter, we experienced strong demand for our latest generation custom-boosted amplifier and first 22-nanometer smart codec. These products, introduced in the fall last year, represent years of engineering effort and a deep and collaborative relationship with our customers. We're proud of the crucial role they play in enhancing the power efficiency and exceptional audio quality of our customers' latest products....

John Forsyth: In our flagship smartphone audio business, during the quarter, we experienced strong demand for our latest generation custom-boosted amplifier and first 22-nanometer smart codec. These products, introduced in the fall last year, represent years of engineering effort and a deep and collaborative relationship with our customers. We're proud of the crucial role they play in enhancing the power efficiency and exceptional audio quality of our customers' latest products.

John Forsyth: I think it is also worth highlighting a characteristic of this area of our business that isn't always apparent to those outside of the company. While we ship custom products into many consumer end devices, much of our custom silicon business offers returns over a significantly longer period than is typical of consumer products. For example, these latest generation audio components that I've referred to superseded a codec and amplifiers that had been shipping in high-volume flagship phones for 5 and 6 years, respectively. We consider this longevity a significant strength of our business, as it provides solid long-term visibility and sustained revenue contribution, along with the ability to leverage our R&D resources in new areas that can drive further innovation and growth. Outside of our custom audio solutions, we also continue to serve a number of customers in the Android ecosystem.

John Forsyth: We consider this longevity a significant strength of our business, as it provides solid long-term visibility and sustained revenue contribution, along with the ability to leverage our R&D resources in new areas that can drive further innovation and growth. Outside of our custom audio solutions, we also continue to serve a number of customers in the Android ecosystem.

John Forsyth: This past quarter, a leading Android OEM introduced its latest flagship smartphone, featuring 2 Cirrus Logic boosted amplifiers and a haptic driver. While the majority of our general market R&D investments are focused on developing products for new markets beyond smartphones, we continue to engage with customers on next-generation flagship smartphone products and expect additional designs from various customers to come to market in the future. Looking beyond audio, we continue to diversify our revenue and expand our smartphone content with high-performance mixed signal solutions. Customer engagement around our camera controllers remains strong, and we were excited to see this technology stand out as a key differentiator in the latest generation of devices. Today, we are engaged on a number of projects that we believe will bring even more feature and performance enhancements to this area in the future.

John Forsyth: This past quarter, a leading Android OEM introduced its latest flagship smartphone, featuring two Cirrus Logic boosted amplifiers and a haptic driver. While the majority of our general market R&D investments are focused on developing products for new markets beyond smartphones, we continue to engage with customers on next-generation flagship smartphone products and expect additional designs from various customers to come to market in the future.

John Forsyth: Looking beyond audio, we continue to diversify our revenue and expand our smartphone content with high-performance mixed signal solutions. Customer engagement around our camera controllers remains strong, and we were excited to see this technology stand out as a key differentiator in the latest generation of devices. Today, we are engaged on a number of projects that we believe will bring even more feature and performance enhancements to this area in the future.

John Forsyth: Moreover, we also have several R&D programs that are focused on battery performance and health, and we continue to believe these areas represent an excellent opportunity for our mixed signal expertise to bring innovation and value to our customers. Our third strategic priority is to leverage our audio and high-performance mixed signal expertise into new applications and markets outside of smartphones. We're making excellent progress here, especially in the PC market, where we are focused on continuing to grow our share across customers and product tiers. During the quarter, we saw strong design activity across our PC portfolio and expect a range of consumer and commercial laptops featuring our components to come to market over the next year, as the adoption of SoundWire device class audio accelerates.

John Forsyth: We're making excellent progress here, especially in the PC market, where we are focused on continuing to grow our share across customers and product tiers. During the quarter, we saw strong design activity across our PC portfolio and expect a range of consumer and commercial laptops featuring our components to come to market over the next year, as the adoption of SoundWire device class audio accelerates.

John Forsyth: After establishing early success in high-end laptops, we are now expanding into mainstream programs to reach higher volume opportunities and capture a larger share of the addressable market. Building on our recent wins in mainstream commercial laptops, this quarter, we were particularly excited to secure our first mainstream consumer design, which is expected to ship next year. This success demonstrates the excellent progress we are making in our long-term strategy to grow beyond smartphones, and positions us well for the continued momentum in the broader PC space. Additionally, we are excited about the long-term opportunity that voice represents as a natural way to interact with AI-enabled PCs, and we increasingly see PC OEMs turning to voice as a means to enhance their products.

John Forsyth: This success demonstrates the excellent progress we are making in our long-term strategy to grow beyond smartphones, and positions us well for the continued momentum in the broader PC space. Additionally, we are excited about the long-term opportunity that voice represents as a natural way to interact with AI-enabled PCs, and we increasingly see PC OEMs turning to voice as a means to enhance their products.

Building on our recent wins in mainstream commercial laptops. This quarter, we were particularly excited to secure our first mainstream consumer design, which is expected to shift next year.

This success demonstrates, the excellent progress. We are making in our long-term strategy, to grow Beyond smartphones and positions us. Well, for the continued momentum in the broader PC space.

John Forsyth: In this area, we are able to leverage our audio and voice expertise, which has been developed and refined in the smartphone market over many years, to develop PC-specific products that deliver enhanced voice capabilities and performance, enabling features such as voice wake for AI applications, even while the device is in an ultra-low power standby state. Our first product featuring this technology is expected to sample to customers in the December quarter. Finally, in the PC space, we have in the last quarter deepened and expanded our engagement across multiple PC platform vendors in order to accelerate our customers' time to market. We believe that our ability to provide consistent audio architectures and advanced features across multiple PC platforms is a great benefit to OEMs.

Additionally, we're excited about the long-term opportunity that voice represents as a natural way to interact with AI enabled, PCS, and we increase PC oems. Turning to voice as a means to enhance their products.

John Forsyth: Our first product featuring this technology is expected to sample to customers in the December quarter. Finally, in the PC space, we have in the last quarter deepened and expanded our engagement across multiple PC platform vendors in order to accelerate our customers' time to market. We believe that our ability to provide consistent audio architectures and advanced features across multiple PC platforms is a great benefit to OEMs.

In this area, we are able to leverage our audio and voice expertise, which has been developed and refined in the smartphone market. Over many years to develop PC specific products that deliver enhanced voice capabilities and performance, enabling features such as Voice work for AI applications. Even while the device is in an ultra low power, standby state,

Our first product featuring. This technology is expected to sample to customers in the December quarter.

John Forsyth: Overall, we are very encouraged by the traction we are seeing in PCs and believe there is a meaningful opportunity ahead for us to grow in this market. Beyond PCs, we are also seeing strong interest in our general market products, which serve a wide range of customers across professional audio, automotive, industrial, and imaging end markets. These products typically have long life cycles and gross margins well above our corporate average, and moreover, can frequently leverage the world-class low-power IP that we have developed in other areas of our business. Our progress in this space was exemplified during the quarter in several areas. First, we gained design momentum with prosumer and automotive customers on all 14 variants of our latest generation ADCs, DACs, and ultrahigh-performance audio codec, and expect new end products utilizing these components to come to market over the next 12 months.

Engagement across multiple PC platform vendors. In order to accelerate our customers time to Market, we believe that our ability to provide consistent audio, architectures. And advanced features across multiple PC platforms is a great benefit to oems overall. We are very encouraged by the traction. We are seeing in PCS, and believe there is a meaningful opportunity ahead for us to grow in this market.

John Forsyth: These products typically have long life cycles and gross margins well above our corporate average, and moreover, can frequently leverage the world-class low-power IP that we have developed in other areas of our business. Our progress in this space was exemplified during the quarter in several areas.

Beyond PCS. We are also seeing strong interest in our General market products which serve a wide range of customers across professional audio automotive, industrial, and imaging and markets.

These products typically have long life cycles and gross margins. Well above our corporate average and moreover can frequently leverage the world class low power. IP that we have developed in other areas of our business.

John Forsyth: First, we gained design momentum with prosumer and automotive customers on all 14 variants of our latest generation ADCs, DACs, and ultrahigh-performance audio codec, and expect new end products utilizing these components to come to market over the next 12 months.

Our progress in this space, was exemplified during the quarter in several areas.

John Forsyth: Second, we had increased engagement with automotive and professional audio customers on our latest timing product family, which began shipping last quarter. And third, we are now sampling a family of high-performance analog front-end components targeting imaging applications, and the initial response has been positive. We're proud of our execution to date in these areas, and will continue to expand our product portfolios in order to drive profitable growth opportunities in these segments. And that concludes the latest progress update on our long-term growth strategy. So let me now turn the call over to Jeff to provide an overview of our financial results as well as the outlook.

First we gained design momentum with prosumer and Automotive customers on all 14 variants of our latest generation, adc's Dax and ultra high performance, audio codec, and expect new end products, utilizing these components to come to Market over the next 12 months.

Second, we had increased engagement with automotive and professional audio customers on our latest timing product family which began shipping last quarter.

John Forsyth: We're proud of our execution to date in these areas, and will continue to expand our product portfolios in order to drive profitable growth opportunities in these segments. And that concludes the latest progress update on our long-term growth strategy. So let me now turn the call over to Jeff to provide an overview of our financial results as well as the outlook.

Third. We are now sampling, a family of high performance analog front-end components targeting Imaging applications. And the initial response has been positive

We are proud of our execution to date in these areas and will continue to expand our product portfolios in order to drive profitable growth opportunities in these segments.

Jeff Woolard: Thank you, John. Good afternoon, everyone. I'll now walk through our Q2 financial performance and provide guidance for Q3, including tax updates. In Q2 fiscal 2026, we delivered revenue of $561 million, which was toward the top end of our guidance range, driven by demand for components shipping into smartphones.... On a sequential basis, revenue was up 38% due to higher smartphone unit volumes. On a year-over-year basis, sales were up 4%, primarily driven by higher smartphone unit volumes and sales associated with our latest generation products. Turning to gross profit and gross margin. Non-GAAP gross profit in the September quarter was $294.7 million, and non-GAAP gross margin was 52.5%. On a year-over-year basis, the increase in gross margin was largely due to a more favorable product mix. This was partially offset by higher inventory reserves.

And that concludes the latest program update on our long-term growth strategy. So, let me now turn the call over to Jeff to provide an overview of our financial results as well as the Outlook.

Thank you, John. Good afternoon everyone. I'll now walk through our Q2 financial performance and provide guidance for Q3 including tax updates

In Q2 fiscal 2026, we delivered revenue of 561 million which was toward the top end of our guidance range driven by demand for components shipping induced smartphones.

Jeff Woolard: On a year-over-year basis, sales were up 4%, primarily driven by higher smartphone unit volumes and sales associated with our latest generation products. Turning to gross profit and gross margin. Non-GAAP gross profit in the September quarter was $294.7 million, and non-GAAP gross margin was 52.5%. On a year-over-year basis, the increase in gross margin was largely due to a more favorable product mix. This was partially offset by higher inventory reserves.

On a sequential basis, Revenue was up 38% due to higher smartphone unit volumes.

On a year-over-year basis, sales were up 4% primarily driven by higher smartphone unit volumes and sales associated with our latest generation products.

Turn into gross profit and gross margin.

Non-gaap gross profit in the September quarter was 294.7 million and non-gaap gross margin with 52.5% on a year-over-year basis. The increase in gross margin was largely due to a more favorable product mix.

Jeff Woolard: Now I'll turn to operating expenses. Our non-GAAP operating expense for the second quarter was $127.7 million, coming in below the low end of our guidance range. This was due to lower product development costs, mostly driven by shifts in project timelines. Employee-related expenses were also lower than expected. On a sequential basis, OpEx was up $8.2 million, primarily due to higher variable compensation, product development costs, mostly due to tapeouts, and facilities-related costs. This was partially offset by a reduction in employee-related expenses. On a year-over-year basis, operating expense was up $0.9 million, primarily due to an increase in employee-related expenses, which were mostly related to annual merit increases. This was partially offset by lower product development costs. Non-GAAP operating income for the quarter was $167 million, or 29.8% of revenue.

This was partially offset by higher inventory, Reserves.

Now, I'll turn to operating expenses.

Or non-gaap operating expense for the second quarter was, 127.7 Million coming in below the low end of our guidance range.

This was due to lower product development costs, mostly driven by shifts in Project timelines.

Employee related expenses were also lower than expected.

Jeff Woolard: This was partially offset by a reduction in employee-related expenses. On a year-over-year basis, operating expense was up $0.9 million, primarily due to an increase in employee-related expenses, which were mostly related to annual merit increases. This was partially offset by lower product development costs. Non-GAAP operating income for the quarter was $167 million, or 29.8% of revenue.

On a sequential basis. Opex was up 8.2 million primarily due to higher variable, compensation product, development costs, mostly due to tape outs and Facilities related costs.

This was partially offset by a reduction in employee related expenses on a year-over-year basis. Operating expense was up. 0.9 million primarily due to an increase in employee related expenses, which are mostly related to annual Merit increases,

This was partially offset by lower price. Development costs.

Jeff Woolard: Turning now to taxes. During Q2, we recorded the favorable tax impact of the One Big Beautiful Bill Act, which reinstated immediate expensing of domestic R&D. This change was retroactive to the start of fiscal year 2026 and contributed to our lower non-GAAP tax rate of 14.6% for the quarter. Then lastly, on the P&L, non-GAAP net income was $150 million, resulting in an earnings per share for the September quarter of $2.83. Let me now turn to the balance sheet. Our balance sheet continues to be strong, and we ended the September quarter with $896 million in cash and investments. Our ending cash and investments balance was up $48.3 million from the prior quarter, as cash generated from operations was partially offset by share repurchases. We continue to have no debt outstanding.

Non-gaap operating income for the quarter was 167 million or 29.8% of Revenue.

Turning now to taxes.

During Q2 we record the favorable tax impact of the 1, big beautiful, bill act, which reinstated immediate expensing of domestic R&D.

This change was retroactive to the start of fiscal year 26 and contributed to our lower non-gaap tax rate of 14.6% for the quarter.

Jeff Woolard: Let me now turn to the balance sheet. Our balance sheet continues to be strong, and we ended the September quarter with $896 million in cash and investments. Our ending cash and investments balance was up $48.3 million from the prior quarter, as cash generated from operations was partially offset by share repurchases. We continue to have no debt outstanding.

And lastly, on the p&l non-gaap, net income was $150. Million, resulting in an earnings per share for the September quarter of $2.83.

Let me now, turn to the balance sheet, our balance sheet continues to be strong and we ended the September quarter with 896 million in cash and Investments.

Set by Sherry purchases.

We continue to have no debt outstanding.

Jeff Woolard: Inventory at the end of the second quarter was $236.4 million, down from $279 million in the prior quarter. Days of inventory were down sequentially, and we ended the quarter with approximately 81 days of inventory. Looking ahead, in Q3 fiscal 2026, we expect inventory to decrease slightly quarter-over-quarter. Turning to cash flow. Cash flow from operations was $92.2 million in the September quarter, and CapEx was $4.5 million, resulting in non-GAAP free cash flow margin of 16%. For the trailing 12-month period, cash flow from operations was $557.3 million, and CapEx was $23.1 million. This resulted in a non-GAAP free cash flow margin of 27%.

Inventory. At the end of the second quarter with 236.4 million down from 279 million in the prior quarter.

Days of inventory. We're down sequentially and we ended the quarter with approximately 81 days of inventory.

Looking ahead in Q3 fiscal 2026. We expect inventory to decrease slightly quarter over quarter.

Jeff Woolard: Cash flow from operations was $92.2 million in the September quarter, and CapEx was $4.5 million, resulting in non-GAAP free cash flow margin of 16%. For the trailing 12-month period, cash flow from operations was $557.3 million, and CapEx was $23.1 million. This resulted in a non-GAAP free cash flow margin of 27%.

Turning to cash flow. Cash flow from operations, was 92.2 million in the September quarter, and capex was 4.5 million resulting in non-gaap free. Cash flow margin of 16%.

Jeff Woolard: On the share buybacks in Q2, we utilized $40 million to repurchase approximately 362,000 shares of our common stock at an average price of $110.55. At the end of Q2 fiscal 2026, the company had $414.1 million remaining on its share repurchase authorization. Now on to guidance. For Q3 fiscal 2026, we expect revenue in the range of $500 to 560 million. Gross margin is expected to range from 51% to 53%. Non-GAAP operating expense is expected to range from $128 to 134 million. The fiscal year non-GAAP effective tax rate is expected to range from approximately 16% to 18%. In closing, we delivered strong results for the September quarter.

For the trailing 12-month period. Cash flow from operations, with 557.3 million and capex was 23.1 Million. This resulted in a non-gaap free cash flow margin of 27%.

On the share Buybacks in Q2, we utilize 40 million dollars to repurchase approximately 362,000, shares of our common stock at an average price of $110.55.

Jeff Woolard: Now on to guidance. For Q3 fiscal 2026, we expect revenue in the range of $500 to 560 million. Gross margin is expected to range from 51% to 53%. Non-GAAP operating expense is expected to range from $128 to 134 million. The fiscal year non-GAAP effective tax rate is expected to range from approximately 16% to 18%. In closing, we delivered strong results for the September quarter.

At the end of Q2 fiscal 2026, the company had 414.1 million remaining on its share repurchase authorization.

Now, on the guidance.

For Q3 fiscal 2026. We expect Revenue in the range of 500 to 560 million.

Gross margin is expected to range from 51 to 53%.

Non-gaap operating expense is expected to range from 128 to 134 million.

The fiscal year non-gaap effective tax rate is expected to range from approximately 16 to 18%.

Jeff Woolard: We remain focused on executing to our strategy and delivering long-term value to shareholders. Before we begin Q&A, I would like to note that while we understand there is intense interest related to our largest customer, in accordance with Cirrus Logic company policy, we will not discuss specifics about our business relationship. With that, let me turn the call to Chelsea to start the Q&A session.

In closing, we delivered strong results to the September quarter. We remain focused on executing to our strategy and delivering long-term value to shareholders.

Before we begin Q&A I would like to note that while we understand there is intense interest related to our largest customer in accordance with Cirrus logic company policy. We will not discuss specifics about our business relationship.

Chelsea Heffernan: Thanks, Jeff. We will now start the Q&A portion of the earnings call. Please limit yourself to a single question and one follow-up. Operator, we are now ready to take questions.

With that, let me turn the call to Chelsea, to start the Q&A session.

Thanks Jeff. We will now start the Q&A portion.

Operator: Thank you. If you would like to ask a question, please press star one on your telephone keypad. If you would like to withdraw your question, simply press star one again. Please ensure that your phone is not on mute when called upon. Thank you. Your first question comes from the line of Tore Svanberg with Stifel. Your line is open.

We are now ready to take questions.

Thank you. If you would like to ask a question, please press star 1 on your telephone keypad, if you would like to withdraw your question, simply press star 1, again, please ensure that your phone is not on mute when called upon

thank you.

Tore Svanberg: Yes, thank you, and congratulations on the results. I know you can't obviously talk specifically about your largest customer's business, but this year has been quite unusual from a seasonality perspective. So, you know, was just wondering if you could share, you know, any thoughts with us on seasonality going forward? I mean, will 2026 potentially be sort of back to normal? Again, you know, anything you could share with us would be really helpful.

Your first question comes from the line of Tori Sandberg with Stifel. Your line is open.

Yes, thank you and congratulations on the results. Um, I I know you can't obviously talk specifically about your largest customer's business, uh but this year has been quite unusual from a seasonality perspective. So um you know, let's just wondering if you could share um, you know, any thoughts with us on on seasonality going forward. Um, I mean,

Jeff Woolard: Yeah, Tore, this is Jeff. I think if, if you recall, we talked about last quarter.

2026 potentially be sort of back to normal, uh, again, you know, any anything you can share with us, but really helpful.

John Forsyth: ... a change in the seasonality shape of our business, primarily driven by the camera content becoming a bigger portion of the total revenue, which shifts a little earlier, you know, as well as, as we talked about some pull-ins, you know, at the last quarter call. I think if you look at our results this quarter and our guidance for next quarter, that story remains the same, that the shape is a little bit pushed in to the first half versus what has been traditionally, and that's driven by just camera content being a greater piece. While we did give some insight last quarter on our view for the year, because we thought it was important for everyone to understand that, that change, that has, that has played out between our results and our guidance.

Jeff Woolard: .a change in the seasonality shape of our business, primarily driven by the camera content becoming a bigger portion of the total revenue, which shifts a little earlier, you know, as well as, as we talked about some pull-ins, you know, at the last quarter call. I think if you look at our results this quarter and our guidance for next quarter, that story remains the same, that the shape is a little bit pushed in to the first half versus what has been traditionally, and that's driven by just camera content being a greater piece.

Yeah, Tori. This is Jeff. I think if, if you recall we talked about last quarter um a change in the seasonality shape of our business primarily driven. Um, by the camera content, becoming a bigger portion of the total revenue, which ships with a little earlier, you know, as well as as we talked about some pull in, you know, at the last quarter call. I think if you look at a results um this quarter and our guidance for next quarter that story Remains the Same that the shape is a little bit pushed in to the first half versus what has been tradition.

additionally, and that's driven by just

Jeff Woolard: While we did give some insight last quarter on our view for the year, because we thought it was important for everyone to understand that, that change, that has, that has played out between our results and our guidance.

Camera content being a greater piece.

John Forsyth: At this point, you know, we are only giving guidance for the next quarter, but we don't see anything from here out that would change historically, you know, what that seasonality looks like for the rest of the fiscal year.

Jeff Woolard: At this point, you know, we are only giving guidance for the next quarter, but we don't see anything from here out that would change historically, you know, what that seasonality looks like for the rest of the fiscal year.

Um, while we did give some insight last quarter on out of our view for the year because we thought it was important. Um, for everyone to understand that that change that is that is played out between our results and our guidance and at this point, um, you know, we're only giving guidance for the next quarter, but we don't see anything from here out that would change historically. Um, you know what, that seasonality looks like for the rest of the fiscal year?

Tore Svanberg: Great. That's very helpful. And as my follow-up, for you, John, in the shareholder letter, you stated again, you know, there's potentials of opportunities on the power/battery side in the smartphone market. Any updates there? Again, I know you can't talk about specific design wins, but, you know, clearly, you know, battery management is becoming, you know, quite crucial for next generation smartphones. So, you know, any updates there would be helpful. Thank you.

John Forsyth: Yeah, that continues to be an area that we're excited about, and as you know, we've been investing in for some time. We do think that we have some really compelling IP in that space, and I think we've seen some validation of that from the comments reflected back to us from customers when we've been sharing silicon with them and details on what we've been developing. We've got a number of irons in the fire there, and as you allude to, the majority of those are related to those areas around the battery, where we think we can make a difference to power efficiency as a whole, to system performance as batteries go through their life cycle both on a daily basis and a long-term basis, and to battery health long term as well.

You know, battery management management is becoming uh, you know, quite quite crucial for Next Generation smartphones. So you know, any any updates there would be helpful, thank you.

Yeah, that continues to be an area that we're excited about. And as you know, we've been investing in for some time, we do think that we have some really compelling IP in that space. And I think we've seen some validation of that from uh, the comments reflected back to us from from customers when we've

John Forsyth: We've got a number of irons in the fire there, and as you allude to, the majority of those are related to those areas around the battery, where we think we can make a difference to power efficiency as a whole, to system performance as batteries go through their life cycle both on a daily basis and a long-term basis, and to battery health long term as well.

Been sharing silicon with them and, and uh, details on what we've been developing.

we've got a number of items in the fire there and as you allude to,

The majority of those are related to those areas around the battery, where we think we can make a difference to uh Power efficiency as a whole to system performance as batteries, go through their, uh, life cycle, both on a daily basis and a long-term basis and to, uh, battery health.

John Forsyth: So we don't have anything to say today concretely about design wins and how that's gonna get commercialized, but we continue to believe that we've got some very valuable IP, and, you know, we're obviously itching to get that out into the market.

We are obviously itching to get that out into the market.

Tore Svanberg: Great. Thank you for the call, John.

Great, thank you for the call, John.

John Forsyth: Yep.

Operator: The next question comes from David Williams with The Benchmark Company. Your line is open.

the next question comes from David Williams with

Your line is open.

David Williams: Hey, good afternoon. Congrats on the quarter, and thanks for letting me ask a question here. Maybe first, just again, on the OpEx side, you kind of mentioned it was lower in this quarter for some pushouts, and it looks like some of that's kind of coming into the Q3. Is it fair to assume that all of the OpEx expected in the Q2 is pushed into that Q3, or is there anything else maybe funny going on that we should be thinking about there?

Hey, good afternoon, congrats on the quarter and uh, thanks for letting me ask a question here.

John Forsyth: No, I think that's a reasonable take. We are pretty disciplined in our OpEx, and what we saw, we did obviously come in below the guide, and some of that was just delays in our spending, not necessarily delays in execution. So you know, that product development cost can be a little lumpy. It's not a miss because, you know, it wasn't low because of execution. Some expenses that we had planned, we were just actually able to avoid, and so that also drove our results, OpEx results, being below guide. So a lot of that is, it's just a timing issue. So we will continue to stay disciplined on that.

Um maybe first just uh on the uh just on the Opex side, you kind of mentioned the the it was lower in this quarter for some push outs and it looks like um some of that's kind of coming into the third quarter. Is it fair to assume that that all of the the Opex expected in the second quarter? Uh, is pushed into that third quarter? Or is there anything else? Maybe a funny going on? That we should be thinking about their

No, I think that's uh, that's that's a um, a reasonable take. Um, we are

John Forsyth: So you know, that product development cost can be a little lumpy. It's not a miss because, you know, it wasn't low because of execution. Some expenses that we had planned, we were just actually able to avoid, and so that also drove our results, OpEx results, being below guide. So a lot of that is, it's just a timing issue. So we will continue to stay disciplined on that.

Pretty disciplined in our Opex and what we saw, um, we did obviously come in below the guide and and some of that was was just delays. Um, in our spending not necessarily delays in the execution. So you know, that that product development cost can be a little lumpy. Um, it's not a Miss because uh you know, it wasn't low because of execution, some expenses that we had planned, we were just actually able to avoid into that came. Um, also drove our

John Forsyth: But that being said, you know, it was a push, but if we see other opportunities that we think have—we have high confidence in, to create value, we will be comfortable increasing that in the future.

John Forsyth: But that being said, you know, it was a push, but if we see other opportunities that we think have we have high confidence in, to create value, we will be comfortable increasing that in the future.

Our results, Opex results being below guide. So, a lot of that is, it's just a timing issue. So we will continue to stay disciplined on that. But that being said, you know, it was a push. But if we see other opportunities that we think have we have high confidence in, uh, to create value, uh, we we will be comfortable increasing that in the future.

David Williams: Okay, good. Thanks. And then maybe just on the non-flagship customer, your largest customer revenue, that contribution in the quarter was maybe a little bit lower than we had anticipated. But just trying to get a sense of the progress in the general markets and in that computing space, how we should think about that revenue trending maybe through this year, and just generally what that growth trajectory should look like outside of your largest customer? Thank you.

John Forsyth: Yeah, I think on the picture for this quarter in particular, there were a number of things going on there, and I think the softness in the Android space is certainly part of it, and that's, you know, that's been widely reported. We don't invest a huge amount in Android as a strategic business area for us, but it still remains a, you know, valuable contributor. So, to some extent, we saw some impact from that. And then, you know, when we look to the rest of our general market business, certainly the biggest kind of growth area that we see there right now is the PC, as you alluded to, and we're continuing to track the way we expected there, are broadly in line with that.

Okay, good, thanks. Um, and then maybe, uh, just on the, the non, uh, Flagship customer your, your largest customer Revenue that contribution in the quarter. Um, was uh, maybe a little bit lower than we had anticipated but just trying to get a sense of of the progress in the general markets and in that Computing space, how we should think about that Revenue trending, maybe through this year. And and just generally um what that growth trajectory should look like outside of your uh your largest customer. Thank you.

John Forsyth: So, to some extent, we saw some impact from that. And then, you know, when we look to the rest of our general market business, certainly the biggest kind of growth area that we see there right now is the PC, as you alluded to, and we're continuing to track the way we expected there, are broadly in line with that.

Yeah, I think on the, the, uh, picture for this quarter in particular, there are, there are a number of things going on there and I I think the softness in the Android space is, uh, is certainly part of it. And that's, you know, that's been widely reported and we don't invest a huge amount in Android, uh, as a strategic business area for us, but it still remains a, uh, you know, a valuable contributor. So, uh, to some extent, we, uh, we saw some impact from that. And, uh, and then, you know, when we look to the rest of our, uh,

John Forsyth: We're still kind of early in the ramp for that, as regards the business it can become for us in the future. But we've passed a number of really, really excellent milestones this year, and then in this past quarter as well, which kind of indicate the great progress we're making there. And we continue to be very excited about what's going on in the PC space. I think one of the things we called out in the shareholder letter that's a particular highlight is the win in mainstream consumer laptop. Because those mainstream devices, as I've highlighted previously, they really, they really deliver so many more units than the devices in the flagship and premium tiers.

General market business. Certainly the, the biggest, uh, kind of growth area that we see there right now is the PC, is you alluded to and we're continuing to track the way we, uh, expected. There are broadly in line with that. Um, we're still kind of early in the, the ramp for that, um, as uh,

John Forsyth: I think one of the things we called out in the shareholder letter that's a particular highlight is the win in mainstream consumer laptop. Because those mainstream devices, as I've highlighted previously, they really, they really deliver so many more units than the devices in the flagship and premium tiers.

As regards the business, it can become for us in the future. Um, but we've, uh, passed a number of, really, really excellent Milestones this year. And then and then in this past quarter as well, which, which kind of indicates the rate progress. We're making there and we we continue to be uh, very excited about what's going on in the PC space. I think 1 of the 1 of the things, we called out in the shareholder letter. It's a particular highlight is

John Forsyth: A big part of our objective is to penetrate down through the tiers and be, you know, well-penetrated in both the commercial and the consumer mainstream segment. Obviously expand as much content in those devices as we can get. This year, earlier in the year, we reported that we won our first mainstream commercial laptop, and then you know, we've now added to that with success in the consumer space. So I think that proves we can do it, and that's gonna be one of multiple drivers that help us continue to accelerate in the PC space.

The uh, the win in mainstream consumer, uh, laptop because those mainstream devices as I've highlighted previously. They really, they really deliver, uh, so many more units than, uh, than the devices in the flagship and, uh, uh, and premium tiers and so, a big part of our objective is to penetrate down through the tears and be, uh, you know, well, penetrated in both the commercial and the consumer mainstream segment.

Uh, and then obviously expand, uh, to as much content in those devices as we can get. Um, this year earlier in the year, we reported that we, we want our first uh, um, mainstream, uh, commercial laptop and then, uh, you know, we've now added to that with, uh, with success in in the consumer space. So I think that, that proves we can do it. Um, and that's going to be 1 of multiple drivers that uh that help us uh continue to accelerate in the PC space.

Operator: Once again, if you have a question or a follow-up question, it is star one on your telephone keypad. Your next question comes from Christopher Rowland with Susquehanna. Your line is open.

Once again, if you have a question or follow up question, it is star 1 on your telephone keypad.

Dylan Ollivier: Hi, this is Dylan Ollivier on for Chris Rowland. Thank you for taking my questions. So for my first question, so last quarter, you said that you didn't have any material changes to your smartphone unit outlook for the year, despite your better results. Would you now have any changes to your unit outlook, or are units still tracking in line?

Your next question comes from Christopher Rowland with SAS Guana. Your line is open.

John Forsyth: Yeah, I'm gonna just stick with, sort of, that previous answer of, we obviously had a good quarter here, driven by smartphone units, and we explained the shape between the last quarter, the last two quarters. And we're only guiding for the next quarter, but we see... At this point, we think seasonality looks like it historically has. We don't see anything to change our view on the upcoming seasonality.

John Forsyth: Yeah, I'm gonna just stick with, sort of, that previous answer of, we obviously had a good quarter here, driven by smartphone units, and we explained the shape between the last quarter, the last two quarters. And we're only guiding for the next quarter, but we see at this point, we think seasonality looks like it historically has. We don't see anything to change our view on the upcoming seasonality.

His last quarter, you said that you didn't have any material changes to your smartphone unit outlook for the year. Uh despite your better results. Uh, would you now have any changes to your unit Outlook or are you still tracking in line?

Yeah, I'm going to just stick with the sort of that previous answer of, um,

We we obviously had a a good quarter here driven by smartphone units, and we explained the shape between the last quarter or the last 2 quarters. Um, and we're only getting for the next quarter. But, um, we see at this point, we think seasonality looks like

Dylan Ollivier: Great. Thank you. So secondly, I'd love to hear more about these new products that you talked about that you're developing for AI PCs. So does this expand your SAM? And when can we expect revenue here? Are you getting a lot of initial interest from customers?

Um, historically has we don't see anything to change our view on on the upcoming seasonality?

Great, thank you. Uh, so, secondly, uh, I'd love to hear more about these new products that, uh, you talked about that, you're developing for aipc. So, does this expand your Sam? And when can we expect Revenue here or are you getting a lot of, uh, initial interest from customers?

John Forsyth: Yeah, actually, that's a-- that's an area which I think has become much more significant in our modeling of our PC SAM more recently, rather than, you know, or at least compared to when we set off down the road of getting into the PC market. The interest across our customer base in voice-related features is really pretty significant as a major enabler for AI. So, I mean, I think if you step back, step back just for a second to look at all the drivers which are currently kind of accelerating our momentum in the PC space, there's one I alluded to in the previous answer, which is just our penetration down through product tiers to get into higher volume segments.

Yeah. Actually that's a, that's an area which I think is become much more significant in our, in our modeling of our, uh, PC Sam.

John Forsyth: The interest across our customer base in voice-related features is really pretty significant as a major enabler for AI. So, I mean, I think if you step back, step back just for a second to look at all the drivers which are currently kind of accelerating our momentum in the PC space, there's one I alluded to in the previous answer, which is just our penetration down through product tiers to get into higher volume segments.

Uh, more recently, rather than, you know, or at least compared to when we, we sat down set off down the road of, getting into the PC market. Um, the, uh, the interest across our customer base in voice related. Uh, features is, uh, is really pretty significant as uh, as a major enabler for, uh,

Uh, for AI. So I mean, I think if you step back um, step back, just for a second to to look at all the drivers which are currently kind of uh, accelerating our momentum in the PC space. Uh, there's 1, I alluded to in the previous answer, which is just our penetration down through. Uh,

John Forsyth: There's another factor which we allude to in the shareholder letter, which is the propagation of the SoundWire device class audio interface and standard. So we're seeing that increasingly propagate across designs that generally is something that's favorable to us, and that's something we've designed to, and that we can deliver a lot of features around. Then, you know, as we also mentioned in the prepared remarks, we've also been expanding our support across multiple PC platform vendors. So again, that's kind of expanding our reach and the number of devices that our products can get into, and the number of reference designs that enable our customers to pick up our silicon and create products around very rapidly.

John Forsyth: Then, you know, as we also mentioned in the prepared remarks, we've also been expanding our support across multiple PC platform vendors. So again, that's kind of expanding our reach and the number of devices that our products can get into, and the number of reference designs that enable our customers to pick up our silicon and create products around very rapidly.

Product tiers to get into higher volume segments. Um, the uh, another another factor, which we allude to in the shareholder letter which is the propagation of um the sound wire device class audio uh, interface and standard. Um, so we're seeing that uh, increasingly uh, propagate across designs that generally is something that's favorable to us. And that's that's, uh, something we've designed to and that we can deliver a lot of features around

then um you know as we also mentioned in uh in the prepared remarks we've also been

John Forsyth: And then the fourth of these drivers would really be the voice features that we see coming over the horizon. And that's been a more recent topic of conversation with OEMs, but it's a significant one, and it's one where our IP is really best in class. We're able to provide significantly better voice and audio capture, noise reduction, voice cleanup, voice detection, speaker detection, and so on. And then where you combine that with our low power codec technologies, we can enable features like waking up the entire system. You know, being able to speak to the system even when it's in a ultra-low power standby state and so on.

John Forsyth: We're able to provide significantly better voice and audio capture, noise reduction, voice cleanup, voice detection, speaker detection, and so on. And then where you combine that with our low power codec technologies, we can enable features like waking up the entire system. You know, being able to speak to the system even when it's in a ultra-low power standby state and so on.

Uh, expanding our support across multiple PC platform vendors. So, again, that's kind of expanding our reach and the, uh, the number of devices that our products can, uh, can get into and the number of reference designs that uh, that enable our customers to pick up our silicon um and create products around very rapidly. And then the fourth of these drivers would really be the voice features that we see coming over the horizon. And that's been a more recent topic of conversation with OEMs. But it's a significant one and it's one where our IP is really, uh, is really best in class. Uh, we're able to provide significantly better, uh, voice and audio capture, um, noise reduction, voice cleanup, uh, voice detection, speaker detection, and so on. Um, and then we're, you know, you combine that with, uh, our low power codec technologies. We can enable features like, uh, waking up the entire system, you know, being able to, uh, speak.

John Forsyth: So, I mean, this is all part of the SAM that we model out in the investor presentation out into the future, that we think can be, you know, continue to be really significant for us in the PC space. But I think given where we're at and the IP we have in the voice area in particular, I would expect us to really benefit from that. Specifically, you know, in the last quarter, we started sampling the first device with it specifically focused on enabling those features to customers. So, you know, it'll be a while before those start showing up in end products, but we have a great roadmap around those features in particular.

John Forsyth: Specifically, you know, in the last quarter, we started sampling the first device with it specifically focused on enabling those features to customers. So, you know, it'll be a while before those start showing up in end products, but we have a great roadmap around those features in particular.

To the system, even when uh, it's in an ultra low power, standby State, and so on. Um, so this is, I mean, this is all part of the Sam that we uh that we model out in in the investor presentation out into the future, um, that we think can be, you know, continue to be really significant for us in the PC space. Um, but I think given where we're at and and the IP we have, uh, in the in the voice area in particular, I would expect us to uh, to really benefit from that, uh, specifically in uh, you know, in in

Operator: Thanks, Dylan. With that, we will end the Q&A session. I will now turn the call back to John for his final remarks.

In the last quarter. We uh, we started uh, sampling. Um, the first device uh with it specifically focused on enabling those features uh, to customers. So, uh, you know, it'll be a while before those, uh, start showing up in end products, but we have a, we have a great roadmap around. Those features in particular,

John Forsyth: Thank you, Chelsea. In summary, Cirrus Logic delivered record revenue for the September quarter, while also continuing to make excellent progress on each pillar of our long-term strategy. I'd like to extend my appreciation to all of our employees worldwide for the hard work and commitment to excellence that has delivered these results. And I'd like to thank our customers for their trust and support. We're excited about the opportunities ahead for Cirrus, and we thank you for your continued interest in the company. Before we close, I'd also like to note that we will be participating in the Barclays Global Technology Conference on 11 December. Please check our investor website for the details. Thank you, everyone, for participating in our call today. Goodbye.

Thanks Dylan. And with that, we will end the Q&A session. I will now turn the call back to John for his final remarks.

Thank you, Chelsea.

In summary serious, logic delivered record revenue for the September quarter while also continuing to make excellent progress on each pillar of our long-term strategy.

John Forsyth: And I'd like to thank our customers for their trust and support. We're excited about the opportunities ahead for Cirrus, and we thank you for your continued interest in the company. Before we close, I'd also like to note that we will be participating in the Barclays Global Technology Conference on 11 December. Please check our investor website for the details. Thank you, everyone, for participating in our call today. Goodbye.

I'd like to extend my appreciation to all of our employees worldwide for the hard work and commitment to Excellence that has delivered these results.

And I'd like to thank our customers for their trust and support.

We're excited about the opportunities ahead for Sirrus, and we thank you for your continued interest in the company.

In the Buckley's global technology conference on December 11th, please check our investor website for the details.

Thank you everyone for participating in our call today. Goodbye.

Operator: This concludes today's conference call. Thank you for joining. You may now disconnect.

This concludes today's conference call, thank you for joining. You may now disconnect

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