SYNAPTICS Inc
For the period ended Sep 27, 2025. Filed Nov 6, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 27, 2025 · Filed Nov 6, 2025
SYNA$116.70+0.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-29; filed 2025-05-08.
0000817720-25-000041
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-27; filed 2025-11-06.
0000817720-25-000115
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 84 previous paragraphs and 46 current paragraphs.
15 unchanged; 18 reworded; 13 added; 49 removed; 2 previous and 0 current paragraphs rearranged.
Tables are not compared: 3 previous and 1 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (13)
Current report
We are a leading worldwide developer and fabless supplier of premium mixed signal semiconductor solutions. We develop solutions that integrate the audio, touch and vision interfaces with embedded processing capabilities that are paired with wireless connectivity. We believe our results to date reflect the combination of our customer focus and the strength of our intellectual property and our engineering know-how, which allow us to develop or engineer products and solutions that meet the demanding design specifications of our OEMs.
Current report
Net revenue in the first quarter of fiscal 2026 was $292.5 million and was 13.5% higher than net revenue in the first quarter of fiscal 2025. This was primarily due to an increase in net revenue in our Core IoT product line, which increased 73.8% compared to the same period a year ago, primarily driven by an increase in units sold and an increase in average selling prices due to our product sales mix, inclusive of the contribution from the Broadcom transaction. Net revenue from our Enterprise and Automotive product line for the first quarter of fiscal 2026 compared to the same period a year ago remained flat and net revenue from our Mobile product category decreased by 18.4% primarily driven by a decrease in revenue from the licensing of certain of our IP.
Current report
Gross margin for the three months ended September 2025 and September 2024 was 42.6% and 46.9%, respectively. The decrease in gross margin was primarily due to a decrease in revenue from the licensing of certain of our IP and an increase in amortization of acquired intangible assets primarily from the developed technologies we acquired from Broadcom during fiscal 2025.
Current report
As of September 2025, our cash and cash equivalents of $459.9 million increased by $7.4 million compared to cash, cash equivalents and short-term investments of $452.5 million as of June 2025. During the three months ended September 2025, we generated $30.2 million of cash from operating activities, and we returned $7.2 million to stockholders through the repurchase of common stock under our stock repurchase program.
Current report
Interest income (expense) and other, net. Interest income/(expense) and other, net, include interest income and expense, amortization of debt issuance costs and other miscellaneous income or charges.
Current report
On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law. The legislation includes a permanent extension and modification of certain provisions under the 2017 Tax Cuts and Jobs Act (“TCJA”). Key provisions effective beginning in the first quarter of fiscal 2026 include immediate expensing of domestic research and experimentation (R&E) expenditures, 100% bonus depreciation for qualified property, and a modification to the business interest expense limitation, among others. These provisions were evaluated and reflected in our income tax provision for the three months ended September 2025 and did not have a material impact on our effective tax rate or cash flows. We will continue to monitor forthcoming Treasury and IRS guidance and assess potential implications for future reporting periods.
Current report
Cash Flows from Investing Activities. Cash provided by investing activities during the three months ended September 2025 was $48.8 million compared to cash used by investing activities of $9.1 million during the same period a year ago. The increase primarily relates to $61.0 million in proceeds from maturities of short-term investments, which we invested in investment classified as cash equivalents.
Current report
Cash Flows from Financing Activities. Cash used by financing activities for the three months ended September 2025 and September 2024 was $10.4 million and $3.5 million, respectively. The increase was primarily driven by $7.2 million in repurchases of our common stock with no share repurchase activity during the same period a year ago.
Current report
Liquidity
Current report
We have $350.0 million available under our revolving credit facility with a maturity date to be the earlier of November 2029 or three months prior to any maturity of our 2029 Notes. As of September 2025, there was no balance outstanding under this facility.
Current report
As of September 2025, our principal long-term debt obligations were $850.0 million.
Current report
As of September 2025, we had unconditional purchase commitments of $41.1 million, of which $27.2 million are for the remainder of fiscal 2026. We work continually with our suppliers and partners on the timing of payments and deliveries of purchase commitments, taking into account business conditions.
Current report
Critical Accounting Estimates
Removed paragraphs (49)
Previous report
We are a leading worldwide developer and fabless supplier of premium mixed signal semiconductor solutions that enable people to engage with connected devices and data, engineering exceptional experiences throughout the home, at work, in the car and on the go. We provide our customers with sensing, processing, and connecting solutions, which represent the three foundational elements of the Internet of Things, or IoT. We supply connectivity, sensors, and artificial intelligence, or AI, enhanced processor solutions to original equipment manufacturers, or OEMs, that design IoT products and devices for automobiles, enterprise workspace devices, virtual reality, smartphones, tablets, and notebook computers. Our currently served markets include IoT, personal computer, or PC, Enterprise and Automotive, and Mobile. Our solutions either contain or consist of our wireless, voice and speech, video processing, fingerprint, authentication, display driver, or touch semiconductor solutions, which include our hardware, and, where applicable, firmware and software.
Previous report
Many of our customers have manufacturing operations in China, and many of our OEM customers have established design centers in Asia. With our global presence, including offices in China, France, Germany, Hong Kong, India, Israel, Japan, Korea, Poland, Switzerland, Taiwan, the U.K., and the U.S., we are well positioned to provide local sales, operational, and engineering support services to our existing customers, as well as potential new customers, on a global basis.
Previous report
Our manufacturing operations are based on a variable cost model in which we outsource all of our production requirements and generally drop ship our products directly to our customers from our contract manufacturers’ facilities, eliminating the need for significant capital expenditures and allowing us to minimize our investment in inventories. This approach requires us to work closely with our contract manufacturers and semiconductor fabricators to ensure adequate production capacity to meet our forecasted volume requirements. We use third-party wafer manufacturers to supply wafers and third-party packaging manufacturers to package our proprietary ASICs. In certain cases, we rely on a single source, or a limited number of suppliers, to provide other key components of our products. Our cost of revenue includes all costs associated with the production of our products, including materials; logistics; amortization of intangibles related to acquired developed technology; backlog; supplier arrangements; manufacturing, assembly, royalties paid to third-party intellectual property providers and test costs paid to third-party manufacturers; and related overhead costs associated with our indirect manufacturing operations personnel. Additionally, we charge all warranty costs, losses on inventory purchase obligations, and the provision for excess and obsolete inventories to cost of revenue.
Previous report
Our gross margin generally reflects the combination of the added value we bring to our OEM customers’ products by meeting their custom design requirements and the impact of our ongoing cost-improvement programs. These cost-improvement programs include reducing materials and component costs and implementing design and process improvements.
Previous report
Our research and development expenses include costs for supplies and materials related to product development, as well as the engineering costs incurred to design ASICs and human experience solutions for OEM customers prior to and after our OEMs’ commitment to incorporate those solutions into their products. We continue to commit to the technological and design innovation required to maintain our position in our existing markets, and to adapt our existing technologies or develop new technologies for new markets.
Previous report
Selling, general, and administrative expenses include expenses related to sales, marketing, and administrative personnel; internal sales and outside sales representatives’ commissions; market and usability research; outside legal, accounting, and consulting costs; and other marketing and sales activities.
Previous report
Acquired intangibles amortization included in operating expenses consists primarily of amortization of customer relationship and tradename intangible assets recognized under the purchase method for business combinations.
Previous report
Intangible asset impairment charges during the third quarter of fiscal 2025 were $13.8 million. We recorded an impairment charge related to a license of certain intellectual property. See Note 8. Goodwill and Acquired Intangible Assets in the notes to the consolidated financial statements for additional information.
Previous report
Restructuring costs primarily reflect severance costs related to the restructuring of our operations to reduce operating expenses and gain efficiencies from our recent acquisitions. See Note 16. Restructuring Activities to the consolidated financial statements contained elsewhere in this Report.
Previous report
Interest and other expense, net, primarily reflects interest expense and amortization of debt issuance costs on our 2031 Notes, Senior Notes and the Term Loan Facility and loss on early extinguishment of debt. See Note 12. Debt for additional information. The interest and other expense, net, is partially offset by interest income earned on our cash and cash equivalents.
Previous report
Acquisitions
Previous report
Broadcom Mobile Android Wi-Fi Business
Previous report
On January 19, 2025, we entered into definitive asset purchase agreements with Broadcom to acquire certain assets and obtain non-exclusive licenses relating to, Broadcom’s existing Mobile Android Wi-Fi Business in the IoT market, for an aggregate consideration of $198.0 million in cash, which closed on January 30, 2025. We also entered into transition agreements with Broadcom, under which both parties will provide one another with certain transition services (including one year inventory supply agreement in which Broadcom will facilitate Synaptics to place purchase orders with respective suppliers). For further discussion of the Broadcom Mobile Android Wi-Fi Business acquisition, see Note 4. Acquisitions, included in the consolidated financial statements contained elsewhere in this report.
Previous report
We acquired these set of assets from Broadcom in order to solidify our leadership position for end-to-end AI
Previous report
Internet of Things (IoT) connectivity and expand our ability to service the Android™ ecosystem. As part of the
Previous report
transaction, we expand our portfolio of Wi-Fi 8 combination devices that include advanced Bluetooth features, additional
Previous report
Wi-Fi 7 combination devices, ultrawide band intellectual property (which we can integrate into future IoT devices), and
Previous report
combination front-end modules. This transaction expands our field of use, allowing all our Wi-Fi products to compete in
Previous report
AR/VR, Android smartphones and consumer audio markets. As a result of this transaction, we expect to generate over
Previous report
$40.0 million in annualized sales in our Core IoT product category.
Previous report
Critical Accounting Policies and Estimates
Previous report
Gross margin as a percentage of net revenue was 45.3%, or $358.9 million, for the nine months ended March 2025, compared with 45.8%, or $326.4 million, for the nine months ended March 2024. The net 50 basis point decrease in gross margin for the nine months ended March 2025 was primarily due to the increase in amortization of acquisition-related intangibles on the intangible assets we acquired from Broadcom in the third quarter of fiscal 2025.
Previous report
Research and Development Expenses. Research and development expenses increased $1.3 million to $253.2 million for the nine months ended March 2025, compared with $251.9 million for the nine months ended March 2024. The increase in research and development expenses was primarily driven by a $14.5 million increase in variable compensation related to our bonus accrual, partially offset by a $13.6 million decrease in in wages and related costs as a result of the restructuring actions initiated during fiscal 2024 and 2025.
Previous report
Selling, General, and Administrative Expenses. Selling, general, and administrative expenses increased $11.7 million to $134.2 million for the nine months ended March 2025, compared with $122.5 million for the nine months ended March 2024. The increase in selling, general, and administrative expenses was primarily driven by a $8.8 million increase in variable compensation related to our bonus accrual, a $6.4 million increase in professional service fees related to the Broadcom transaction we executed in the third quarter of fiscal 2025 and the refinancing of our Term Loan B in the second quarter of fiscal 2025, a $2.4 million unfavorable impact from exchange rates on foreign currencies, partially offset by a $8.3 million decrease in stock-based compensation charges primarily related to net forfeitures relating to the departure of certain executive officers from the Company compared to the same period a year ago.
Previous report
Intangible asset impairment charge. Intangible asset impairment reflects an impairment charge of $13.8 million related to a license of certain intellectual property. See Note 8. Goodwill and Acquired Intangible Assets in the notes to the consolidated financial statements for additional information on intangible asset impairment charge.
Previous report
Non-Operating Income
Previous report
Interest and other income of $23.0 million for the nine months ended March 2025 decreased by $8.4 million, compared to the same period a year ago, which was primarily driven by an overall decrease in interest rates and a decrease in our invested cash and cash equivalents, as well as a reduction in cash balances following the early repayment of the entire Term Loan Facility in November 2024 and Broadcom acquisition in January 2025.
Previous report
Interest expense of $34.3 million for the nine months ended March 2025, decreased by $14.5 million compared to the same period a year ago and was primarily driven by the early repayment of the Term Loan Facility in November 2024. During the nine months ended March 2025 and March 2024, the interest expense on the Term Loan facility was $19.2 million and $35.8 million, a decrease of $16.6 million year-over year. The Term Loan Facility was repaid with the net proceeds received from the issuance of the 2031 Notes, which bears a significantly lower interest at a rate of 0.75%. See Note 12. Debt for additional information.
Previous report
Loss on early extinguishment of debt. In connection with our issuance of the 2031 Notes, we used a portion of the net proceeds from the 2031 Notes, along with our cash on hand, to repay the outstanding balance under our Term Loan Facility. The repayment of the Term Loan Facility was accounted for as a debt extinguishment. The consideration used to extinguish the Term Loan Facility and the carrying value of the Term Loan Facility (including unamortized debt issuance costs) resulted in a loss on early extinguishment of debt of $6.5 million, which is included in "Loss on early extinguishment of debt" within our condensed consolidated statements of operations.
Previous report
Cash Flows from Operating Activities. Our cash generated from operating activities primarily relate to cash collections from our customers, payments for inventory purchases and payments for employee- related expenditures.
Previous report
Operating activities during the nine months ended March 2024 generated $70.9 million. For the nine months ended March 2024, the primary operating activities were adjustments for non-cash charges of $176.8 million and a net change in operating assets and liabilities of $23.2 million. The net change in operating assets and liabilities was primarily attributable to a $20.1 million decrease in accounts receivable primarily related to the normal variations in the timing of collections and billings, an $8.7 million decrease in gross inventories as we continue our efforts to control inventory investment while turning over the inventories we accumulated during the first half of fiscal 2023 and a $22.8 million increase in accounts payable due to the timing of payments made to our vendors, partially offset by a $20.3 million decrease in accrued compensation primarily related to the payment of our annual bonus in the first quarter of fiscal 2024 and a $46.9 million decrease in income taxes payable.
Previous report
Cash Flows from Investing Activities. Cash used by investing activities during the nine months ended March 2025 and March 2024 was $289.0 million and $146.7 million, respectively. Net cash used in investing activities for the nine months ended March 2025 primarily related to $198.0 million we paid to acquire certain assets and obtain non-exclusive licenses relating to, Broadcom’s existing Mobile Android Wi-Fi Business in the IoT market and the purchase of $61.0 million in short-term investments.
Previous report
Cash used in investing activities during the nine months ended March 2024 was $146.7 million. Net cash used in investing activities for the nine months ended March 2024 consisted of $130.0 million paid to Broadcom as a prepayment to acquire developed technologies and to extend the exclusivity for certain products for an additional three-year period, $16.6 million to purchase short-term investments and $26.1 million for purchases of property and equipment, partially offset by $26.0 million in proceeds from the maturities of our short-term investments.
Previous report
Cash Flows from Financing Activities. Cash used by financing activities for the nine months ended March 2025 and March 2024 was $313.0 million and $20.4 million, respectively. Net cash used by financing activities for the nine months ended March 2025 consisted of $583.5 million used to repay the remaining outstanding balance of our Term Loan Facility, $112.3 million used to repurchase our common stock, exclusive of excise taxes, $49.9 million used for the payment of capped call transactions associated with our 2031 Notes, partially offset by $439.5 million in net proceeds from issuance of our 2031 Notes.
Previous report
Cash used in financing activities during thenine months ended March 2024 was$20.4 million. Net cash used by financing activities for the nine months ended March 2024 consisted of $33.7 million used for payroll taxes on the delivery of the underlying shares for share-based awards, partially offset by $15.9 million proceeds from issuance of shares.
Previous report
Common Stock Repurchase Program. As of April 2023, our board of directors had cumulatively authorized $2.3 billion for our common stock repurchase program, which will expire in July 2025. The program authorizes us to purchase our common stock in the open market or in privately negotiated transactions, depending upon market conditions and other factors. The number of shares purchased, and the timing of purchases, are based on the level of our cash balances, general business and market conditions, and other factors. Common stock purchased under this program is held as treasury stock. From April 2005 through March 2025, we purchased, net of issuances for settlement of our convertible notes, 31,649,301 shares of our common stock in the open market for an aggregate cost of $990.3 million. During the nine months ended
Previous report
March 2025, we repurchased 1,532,862 shares of our common stock in the open market for an aggregate cost of $112.3 million. As of March 2025, the remaining available authorization under our common stock repurchase program was $781.6 million.
Previous report
Senior Notes. In March 2021, we completed an offering of $400.0 million aggregate principal amount of 4.0% senior notes due 2029, or the Senior Notes, in a private offering. The Senior Notes were issued pursuant to an Indenture, dated as of March 11, 2021, by and among our company, the guarantors named therein and Wells Fargo Bank, National Association, as trustee. The Senior Notes requires bi-annual interest only payments in June and December of each year. For the nine months ended March 2025, we paid interest expense of $8.0 million on the Senior Notes.
Previous report
Bank Credit Facility. On November 21, 2024, we entered into the Fourth Amendment to our Credit Agreement. The Fourth Amendment extends the maturity date of the Credit Agreement and, among other things, increases the revolving commitments from $250.0 million to $350.0 million. Under the terms of the Fourth Amendment we may, subject to the satisfaction of certain conditions, request increases in the revolving credit facility commitments in an aggregate principal amount of up to $170.0 million. Future proceeds under the revolving credit facility are available for working capital and general corporate purposes. As of March 2025, there was no balance outstanding under the revolving credit facility.
Previous report
2031 Notes. On November 19, 2024 and November 26, 2024, we issued and sold $400.0 million and $50.0 million, respectively, in aggregate principal amount of 0.75% Convertible Senior Notes due 2031, or the 2031 Notes, in a private placement. The 2031 Notes are unsecured, bear interest at a rate of 0.75% per year, payable semi-annually in arrears on June 1 and December 1 of each year, beginning on June 1, 2025, and will mature on December 1, 2031, unless earlier converted, redeemed or repurchased by us.
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Reworded paragraphs (18)
Previous wording
This Quarterly Report on Form 10-Q for the quarter ended March 29, 2025 (this “Report”) contains forward-looking statements that are subject to the safe harbors created under the Securities Act of 1933, as amended, or the Securities Act, and the Securities Exchange Act of 1934, as amended, or the Exchange Act. Forward-looking statements give our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business, can be identified by the fact that they do not relate strictly to historical or current facts. Such forward-looking statements may include words such as “expect,” “anticipate,” “intend,” “believe,” “estimate,” “plan,” “target,” “strategy,” “continue,” “may,” "commit," “will,” “should,” variations of such words, or other words and terms of similar meaning. All forward-looking statements reflect our best judgment and are based on several factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control. Such factors include, but are not limited to the following: macroeconomic uncertainties in the U.S. and globally, including those caused by trade tensions and tariffs, resulting in supply chain disruptions, inflation, and market volatility, which may adversely affect our products and those of our customers and suppliers, resulting in reduced customer demand, component availability constraints, cost increases (both to us and our customers), supply chain disruption, and stock price volatility; risks related to our continued dependence on our solutions for the Core IoT and Enterprise and Automotive product applications market for a substantial portion of our revenue; risks related to the volatility of our net revenue from our solutions for Core IoT and Enterprise and Automotive product applications; our dependence on one or more large customers; our exposure to industry downturns and cyclicality in our target markets; the risk that our product solutions for new markets will not be successful; risks related to our expectations regarding technology and strategic investments and the anticipated timing or benefits thereof; our ability to execute on our cost reduction initiatives and to achieve expected synergies and expense reductions; our ability to maintain and build relationships with our customers; our dependence on third parties to maintain satisfactory manufacturing yields and deliverable schedule; the risk that our indemnification obligations for third party claims could result in substantial costs; risks and uncertainty related to regional instabilities and hostilities (including the conflict in the Middle East), economic volatility, and regulatory changes, any of which could disrupt our supply chain, elevate our costs and undermine the competitiveness of our offerings, requiring operational adjustments, such as reductions in force, or otherwise adversely affecting our financial condition…
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Current wording
This Quarterly Report on Form 10-Q for the quarter ended September 27, 2025 (this “Report”) contains forward-looking statements that are subject to the safe harbors created under the Securities Act of 1933, as amended, or the Securities Act, and the Securities Exchange Act of 1934, as amended, or the Exchange Act. Forward-looking statements give our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business, can be identified by the fact that they do not relate strictly to historical or current facts. Such forward-looking statements may include words such as “expect,” “anticipate,” “intend,” “believe,” “estimate,” “plan,” “target,” “strategy,” “continue,” “may,” "commit," “will,” “should,” variations of such words, or other words and terms of similar meaning. All forward-looking statements reflect our best judgment and are based on several factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control. Such factors include, but are not limited to the following: macroeconomic uncertainties in the U.S. and globally, including those caused by trade tensions and tariffs, resulting in supply chain disruptions, inflation, and market volatility, which may adversely affect our products and those of our customers and suppliers and result in reduced customer demand, component availability constraints, cost increases (both to us and our customers), supply chain disruption, and stock price volatility; risks related to our continued dependence on our solutions for the Core IoT and Enterprise and Automotive product applications market for a substantial portion of our revenue; risks related to the volatility of our net revenue from our solutions for Core IoT and Enterprise and Automotive product applications, including competition from new or established IoT and wireless service companies or from those with greater resources; our dependence on and/or loss of one or more large customers for a substantial portion of our revenue, and the loss of commitments from, contracts with, or a significant reduction in orders from, one or more of our major customers could have a material adverse effect on our revenue and operating results; our exposure to industry downturns and cyclicality in our target markets; the risk that our new product solutions for existing or new markets will not be successful; our ability to successfully execute on our strategy to develop integrated solutions including audio, touch and vision interfaces with embedded processing and wireless connectively for customer adoption; risks related to our expectations regarding technology and strategic investments and the anticipated timing or benefits thereof; historical and continued decreases in our average selling prices due to our product sales mix and decreased revenue from our mobile product applications; our ability to attract and retain…
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Previous wording
Certain of the data used in our condensed consolidated statements of operations for the periods indicated, together with comparative absolute and percentage changes in these amounts, were as follows (in millions, except percentages):
Current wording
Certain of the data used in our condensed consolidated statements of operations for the periods indicated, together with comparative absolute and percentage changes in these amounts, were as follows:
Previous wording
Net revenue was $791.5 million for the nine months ended March 2025, compared with $712.0 million for the nine months ended March 2024, an increase of $79.5 million, or 11.2%. Of this net revenue, $460.5 million, or 58.2%, was from Enterprise and Automotive product applications, $142.8 million, or 18.0%, was from Mobile product applications, and $188.2 million, or 23.8%, was from Core IoT product applications. Revenue increased in most of our product applications for the nine months ended March 2025. Net revenue from Core IoT product applications increased due to an increase in units sold (which increased 35.9%), as well as an increase in average selling prices (which increased 12.3%) due to our product sales mix compared to the same period a year ago. Net revenue from Enterprise and Automotive product applications increased as a result of an increase in units sold (which increased 9.6%), and an increase in average selling prices (which increased 6.1%) due to our product sales mix compared to the same period a year ago. The increase in revenue from Enterprise and Automotive product applications was partially offset by a decrease of $30.0 million in revenue from the licensing of certain of our IP. Net revenue from Mobile product applications decreased due to a decrease in units sold (which decreased 8.1%), and a decrease in average selling prices (which decreased 7.6%), as overall demand decreased for our products in the mobile market compared to the same period a year ago. The decrease in revenue from Mobile product applications was partially offset by an increase of $4.5 million in revenue from the licensing of certain of our IP.
Current wording
Net revenue was $292.5 million for the three months ended September 2025, compared with $257.7 million for the three months ended September 2024, an increase of $34.8 million, or 13.5%. Of this net revenue, $147.7 million, or 50.5%, was from Enterprise and Automotive product applications, $41.2 million, or 14.1%, was from Mobile product applications, and $103.6 million, or 35.4%, was from Core IoT product applications. Revenue increased in most of our product applications for the three months ended September 2025 compared with the three months ended September 2024. Net revenue from Core IoT product applications increased due to an increase in units sold (which increased 64.1%) and an increase in average selling prices (which increased 5.9%) due to our product sales mix compared to the same period a year ago, inclusive of the contribution from the Broadcom transaction. Net revenue from Enterprise and Automotive product applications slightly increased as a result of an increase in units sold (which increased 9.0%), partially offset by a decrease in average selling prices (which decreased 8.2%) due to our product sales mix compared to the same period a year ago. Net revenue from Mobile product applications decreased due to a decrease in average selling prices (which decreased 15.2%) and a decrease of $10.5 million in revenue from license of certain of our IP, partially offset by an increase in units sold (which increased 21.4%).
Previous wording
Gross margin as a percentage of net revenue was 43.4%, or $115.8 million, for the three months ended March 2025, compared with 46.5%, or $110.3 million, for the three months ended March 2024. The net 310 basis point decrease in gross margin for the three months ended March 2025 was primarily due to the increase in amortization of acquisition-related intangibles on the intangible assets we acquired from Broadcom in the third quarter of fiscal 2025.
Current wording
Gross margin as a percentage of net revenue was 42.6%, with gross margin of $124.6 million, for the three months ended September 2025, compared with 46.9%, with gross margin of $120.9 million, for the three months ended September 2024. The net 430 basis point decrease in gross margin as a percentage of net revenue for the three months ended September 2025 was primarily due to the increase in amortization of acquisition-related intangibles on the intangible assets we acquired from Broadcom during fiscal 2025 and a decrease in revenue from license of certain of our IP.
Previous wording
Research and Development Expenses. Research and development expenses increased $5.2 million to $88.6 million for the three months ended March 2025, compared with $83.4 million for the three months ended March 2024. The increase in research and development expenses was primarily driven by a $5.3 million increase in variable compensation related to our bonus accrual, $3.5 million increase in stock-based compensation charges primarily related to awards issued to the workforce we acquired from Broadcom in the third quarter of fiscal 2025, partially offset by a $5.2 million decrease in wages and related costs as a result of the restructuring actions initiated during fiscal 2024 and 2025.
Current wording
Research and Development Expenses. Research and development expenses increased $13.1 million to $94.4 million for the three months ended September 2025, compared with $81.3 million for the three months ended September 2024. The increase in research and development expenses was driven by a $6.3 million increase in stock-based compensation charges primarily related to awards issued to the workforce we acquired from Broadcom during fiscal 2025, a $2.8 million increase in project specific costs, and $1.8 million increase in wages and related costs related to an increase in headcount primarily driven by the employees we acquired from Broadcom during fiscal 2025.
Previous wording
Selling, General, and Administrative Expenses. Selling, general, and administrative expenses decreased $5.8 million to $34.7 million for the three months ended March 2025, compared with $40.5 million for the three months ended March 2024. The decrease in selling, general, and administrative expenses was primarily driven by a decrease of $12.9 million in stock-based compensation charges primarily related to forfeitures from the departure of certain executive officers during the third quarter of fiscal 2025, partially offset by a $3.2 million increase in variable compensation related to bonus accrual and a $1.9 million increase in professional service fees associated with the Broadcom transaction we executed in the third quarter of fiscal 2025.
Current wording
Selling, General, and Administrative Expenses. Selling, general, and administrative expenses decreased $3.8 million to $46.2 million for the three months ended September 2025, compared with $50.0 million for the three months ended September 2024. The decrease in selling, general, and administrative expenses was primarily driven by a decrease of $4.5 million in professional service fees related to certain corporate projects that we incurred during the first quarter of fiscal 2025 with no corresponding corporate projects during the three months ended September 2025.
Previous wording
Acquired Intangibles Amortization. Amortization of acquisition-related intangibles increased $0.5 million, or 12.5% for the three months ended March 2025 compared to the same period a year ago, which is primarily related to the amortization on customer relationship and favorable supply contract intangible assets we acquired from Broadcom during the third quarter of fiscal 2025. Amortization of acquisition-related intangibles decreased $1.3 million, or 9.7%, for the nine months ended months ended March 2025, compared to the same periods a year ago. The decrease is primarily related to the amortization of customer related intangible assets and acquired trademarks which were fully amortized by the end of fiscal 2024, partially offset by an increase of $0.6 million in amortization on the customer relationship intangible asset we acquired from Broadcom during the third quarter of fiscal 2025.
Current wording
Acquired Intangibles Amortization. Amortization of acquisition-related intangibles increased $0.9 million, or 23.7% for the three months ended September 2025 compared to the same period a year ago, which is primarily related to the amortization on customer relationship and favorable supply contract intangible assets we acquired from Broadcom during fiscal 2025.
Previous wording
Restructuring Costs. Restructuring costs primarily reflect employee severance costs related to the restructuring of operations and to improve efficiencies in our operational activities. These headcount-related costs included personnel in operations, research and development, and selling, general and administrative functions. See Note 16. Restructuring Activities in the notes to the consolidated financial statements for additional information on restructuring costs.
Current wording
Restructuring Costs. Restructuring costs primarily reflect employee severance costs related to the restructuring of operations and to improve efficiencies in our operational activities. These headcount-related costs included personnel in research and development, and selling, general and administrative functions. See "Item 1. Condensed Consolidated Financial Statements (Unaudited) - Notes to Condensed Consolidated Financial Statements - Note 16. Restructuring Activities for additional information.
Previous wording
Interest and Other Income. Interest and other income of $4.6 million decreased by $5.7 million for the three months ended March 2025, compared to the same period a year ago, which was primarily driven by an overall decrease in interest rates on our invested cash and cash equivalents, as well as a reduction in cash balances following the early repayment of the entire Term Loan Facility in November 2024 and Broadcom acquisition in January 2025.
Current wording
Interest and other income. Interest and other income includes interest income earned on our invested cash balances and other miscellaneous income. Interest and other income of $6.3 million decreased by $4.0 million for the three months ended September 2025, compared to the same period a year ago. The decrease was primarily driven by a decrease in interest income of $6.3 million due to the overall reduction in invested cash balances following the early repayment of the Term Loan Facility in November 2024 and the cash paid for the Broadcom acquisition in January 2025, partially offset by a $2.3 million increase in miscellaneous other income relating to a refund of amounts we paid previously to a third party.
Previous wording
Interest expense. Interest expense primarily includes interest on our debt and amortization of debt issuance costs. Interest expense of $5.7 million for the three months ended March 2025, decreased by $10.5 million compared to the same period a year ago, which was primarily driven by the early repayment of the Term Loan Facility in November 2024. During the three months ended March 2024, the interest expense on the Term Loan facility was $11.9 million. The Term Loan Facility was repaid with the net proceeds received from the issuance of the 2031 Notes, which bears a significantly lower interest at a rate of 0.75%. See Note 12. Debt for additional information.
Current wording
Interest expense. Interest expense primarily includes interest expense on our debt, unused commitment fees on our revolving credit facility and amortization of debt issuance costs. Interest expense of $5.8 million for the three months ended September 2025, decreased by $10.4 million compared to the same period a year ago, which was primarily driven by the early repayment of the Term Loan Facility in November 2024. During the three months ended September 2024, the interest expense and amortization of debt issuance costs on the Term Loan facility was $11.7 million. The Term Loan Facility was repaid with the net proceeds received from the issuance of the 2031 Notes, which bear a significantly lower interest at a rate of 0.75%. See "Note 9. Debt" for additional information.
Previous wording
The Organization for Economic Co-operation and Development, or OECD, introduced Pillar Two Model Rules for a global minimum tax of 15% applicable to large multinational corporations. Many countries in which we have business operations, including the United Kingdom, Switzerland, and Japan, have implemented certain aspects of Pillar Two, which become effective to our company in fiscal 2025. The OECD and the implementing countries are expected to keep issuing more guidance and refining their laws. Based on the latest legislation and our current estimate, Pillar Two had no impact on our effective tax rate or cash flows for the first nine months of fiscal 2025. We will continue to evaluate the potential impact of these tax law changes on future reporting periods.
Current wording
The Organization for Economic Co-operation and Development, or OECD, introduced Pillar Two Model Rules for a global minimum tax of 15% applicable to large multinational corporations. Many countries in which we have business operations, including the United Kingdom, Hong Kong, Switzerland, and Japan, have implemented certain aspects of Pillar Two. The OECD and the implementing countries are expected to keep issuing more guidance and refining their laws. Based on the latest legislation and our current estimate, Pillar Two had no impact on our effective tax rate or cash flows for the first three months of fiscal 2026. We will continue to evaluate the potential impact of these tax law changes in future reporting periods as further guidance becomes available.
Previous wording
See Note 14. Income Taxes in the Notes to the Unaudited Condensed Consolidated Financial Statements for additional information on our (benefit)/provision for income taxes.
Current wording
See "Item 1. Condensed Consolidated Financial Statements (Unaudited) - Notes to Condensed Consolidated Financial Statements - Note 13. Income Taxes for additional information.
Previous wording
Our cash and cash equivalents were $360.4 million and $876.9 million as of March 2025 and June 2024, respectively, representing a decrease of $516.5 million. The decrease in cash and cash equivalents during nine months ended March 2025 was driven by cash used in financing activities of $313.0 million related to full repayment of our Term Loan Facility, repurchases of our common stock, partially offset by net proceeds from the issuance of the 2031 Notes (as defined below) and cash used in investing activities of $289.0 million primarily related to our asset purchase agreement with Broadcom.
Current wording
Our cash and cash equivalents were $459.9 million and $391.5 million as of September 2025 and June 2025, respectively.
Previous wording
We consider almost all of the earnings of our foreign subsidiaries as not indefinitely invested overseas and have made appropriate provisions for income or withholding taxes that may result from a future repatriation of those earnings. As of March 2025, $254.1 million of cash and cash equivalents was held by our foreign subsidiaries. If these funds are needed for our operations in the United States, we would be able to repatriate substantially all of these funds without a material impact on our provision for income taxes.
Current wording
We consider almost all of the earnings of our foreign subsidiaries as not indefinitely invested overseas and have made appropriate provisions for income or withholding taxes that may result from a future repatriation of those earnings. As of September 2025, $363.4 million of cash and cash equivalents was held by our foreign subsidiaries. If these funds are needed for our operations in the United States, we would be able to repatriate substantially all of these funds without a material impact on our provision for income taxes.
Previous wording
Cash provided by operating activities during the nine months ended March 2025 was $84.8 million compared with cash provided by operating activities of $70.9 million during same period a year ago. For the nine months ended March 2025, the primary operating activities were adjustments for non-cash charges of $161.0 million and net cash outflows of $33.1 million from changes in our operating assets and liabilities. The primary drivers of the change in operating assets and liabilities relate to a decrease in income taxes payable primarily related to tax payments of approximately $43.0 million made to various tax jurisdictions and a decrease in accounts receivable primarily related to the timing of collections and billings, offset by an increase of $19.1 million in accrued compensation primarily related to the accrual of our annual bonus and an increase of $17.5 million in net inventories. Our inventory levels will vary based on the availability of supply and the impact of variations between forecasted and actual demand.
Current wording
Cash Flows from Operating Activities. Cash provided by operating activities during the three months ended September 2025 was $30.2 million compared with cash used by operating activities of $11.4 million during same period a year ago. For the three months ended September 2025, the primary operating activities were adjustments for non-cash charges of $77.6 million and net cash outflows of $26.8 million from changes in our operating assets and liabilities. The primary drivers of the change in operating assets and liabilities relate to a decrease of $31.6 million in accrued liabilities primarily related to the payment of our annual bonus, a decrease of $7.0 million in accounts payable due to the timing of payments made to our vendors, partially offset by a decrease in accounts receivable of $10.8 million primarily related to the timing of collections and billings.
Previous wording
During the three months ended March 2025 and March 2024, our days sales outstanding was 45 days and 55 days, respectively. Our annual inventory turns stayed consistent at four during the three months ended March 2025 and March 2024.
Current wording
During the three months ended September 2025 and September 2024, our days sales outstanding was 37 days and 47 days, respectively. Our annual inventory turns stayed consistent at four during the three months ended September 2025 and September 2024.
Previous wording
Working Capital Needs. We believe our existing cash and cash equivalents, anticipated cash flows from operating activities, anticipated cash flows from financing activities, and available credit under our revolving credit facility, will be sufficient to meet our working capital and other cash requirements, and our debt service obligations for at least the next 12 months. Our future capital requirements will depend on many factors, including our revenue, the timing and extent of spending to support product development efforts, costs associated with restructuring activities net of projected savings from those activities, costs related to protecting our intellectual property, the expansion of sales and marketing activities, timing of introduction of new products and enhancements to existing products, costs to ensure access to adequate manufacturing, costs of maintaining sufficient space for our workforce, the continuing market acceptance of our product solutions, our common stock repurchase program, and the amount and timing of our investments in, or acquisitions of, other technologies or companies. Further equity or debt financing may not be available to us on acceptable terms. If sufficient funds are not available or are not available on acceptable terms, our ability to fund our future long-term working capital needs, take advantage of business opportunities or to respond to competitive pressures could be limited or severely constrained.
Current wording
Working Capital Needs. We believe our existing cash and cash equivalents, anticipated cash flows from operating activities and available credit under our revolving credit facility, will be sufficient to meet our working capital and other cash requirements, and our debt service obligations for at least the next 12 months. Our future capital requirements will depend on many factors, including our revenue, the timing and extent of spending to support product development efforts, costs associated with restructuring activities net of projected savings from those activities, costs related to protecting our intellectual property, the expansion of sales and marketing activities, timing of introduction of new products and enhancements to existing products, costs to ensure access to adequate manufacturing, costs of maintaining sufficient space for our workforce, the continuing market acceptance of our product solutions, our common stock repurchase program, and the amount and timing of our investments in, or acquisitions of, other technologies or companies. Further equity or debt financing may not be available to us on acceptable terms. If sufficient funds are not available or are not available on acceptable terms, our ability to fund our future long-term working capital needs, take advantage of business opportunities or to respond to competitive pressures could be limited or severely constrained.
Previous wording
There have been no significant changes in our critical accounting policies and estimates during the nine months ended March 2025, compared with our critical accounting policies and estimates disclosed in Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the fiscal year ended June 29, 2024.
Current wording
There have been no significant changes in our critical accounting estimates during the three months ended September 2025, compared with our critical accounting estimates disclosed in Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the fiscal year ended June 28, 2025.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
Certain of the data used in our condensed consolidated statements of operations presented here as a percentage of net revenue for the periods indicated were as follows:
Previous report — wording carried elsewhere
Net revenue was $266.6 million for the three months ended March 2025, compared with $237.3 million for the three months ended March 2024, an increase of $29.3 million, or 12.3%. Of this net revenue, $153.8 million, or 57.7%, was from Enterprise and Automotive product applications, $45.3 million, or 17.0%, was from Mobile product applications, and $67.5 million, or 25.3%, was from Core IoT product applications. Revenue increased in most of our product applications for the three months ended March 2025. Net revenue from Core IoT product applications increased due to an increase in units sold (which increased 18.1%), as well as an increase in average selling prices (which increased 20.8%) due to our product sales mix compared to the same period a year ago. Net revenue from Enterprise and Automotive product applications increased as a result of an increase in units sold (which increased 9.2%) as well as an increase in average selling prices (which increased 4.6%) due to our product sales mix. Net revenue from Mobile product applications decreased due to a decrease in units sold (which decreased 10.8%) as well as a decrease in average selling prices (which decreased 8.2%), as overall demand decreased for our products in the mobile market.