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A month has gone by since the last earnings report for Qorvo (QRVO). Shares have lost about 13.4% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Qorvo due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Qorvo Q3 Earnings Surpass Estimates Despite Lower Revenues
Qorvo reported strong third-quarter fiscal 2025 results, with both the bottom line and top line surpassing the respective Zacks Consensus Estimate. The company reported a revenue contraction year over year due to a net sales drop in the Advanced Cellular Group (ACG) vertical. However, solid demand trends in multiple end markets, including defense, aerospace, power management, WiFi and smartphones, cushioned the top-line growth in this quarter.
Revenues
Net sales during the quarter declined to $916.3 million from $1.07 billion in the prior-year quarter. Despite significant improvement in inventory levels, demand in various end markets was yet to fully recover, which impeded revenues. Macroeconomic headwinds also impacted the top line. Nevertheless, during the quarter, the company secured major deal wins for its ultra-wideband applications and the state-of-the-art Wi-Fi 7 front-end modules that offer unmatched flexibility in power management and efficiency. The top line beat the Zacks Consensus Estimate of $901 million.
HPA contributed $171.7 million in revenues, up from $118.9 million in the year-ago quarter. Net sales beat the Zacks Consensus Estimate of $168.1 million. The company secured new product orders for several large domestic and international ground-based radar systems. The transition from legacy mechanical systems to active electronics scanning systems led to growth in the defense and aerospace business.
In power management, the company continues to boast a strong presence in the consumer electronic sector. Healthy traction in automotive also cushioned the top line. The growing demand for DOCSIS 4.0 hybrid power doublers is supporting growth of the infrastructure business.
Revenues from CSG were $109.5 million compared with $108.9 million in the year-earlier quarter. The improvement was driven by the growing adoption of WIFI 7 across operator, retail, enterprise, and mobile segments. Strong emphasis on RF solutions and investment in diverse growth businesses, including an expanding portfolio of automotive solutions and SoCs for ultra-wideband Thread, also supported this segment. However, net sales fell short of the Zacks Consensus Estimate of $121.1 million.
Net sales in ACG were $635.1 million, down 24.9% year over year, due to seasonal dynamics. However, the top line beat the Zacks Consensus Estimate of $611.2 million.