Qorvo Shares Plummet 12% on Disappointing Forecasts

GREENSBORO, N.C. - Qorvo Inc. (NASDAQ:QRVO) reported financial results for its second quarter that exceeded expectations, but the company’s forecasts fell short of analyst estimates, leading to a 12% drop in shares during after-hours trading.
The semiconductor company announced adjusted earnings of $1.88 per share for the quarter ending September 28, surpassing the consensus estimate of $1.84. Revenues were reported at $1.05 billion, slightly above analysts' expectations of $1.03 billion, but showing a 5.2% decline compared to the same period last year.
However, Qorvo's guidance for the current quarter disappointed investors. The company projected third-quarter revenue of approximately $900 million, significantly below Wall Street's forecast of $1.05 billion. Qorvo also anticipated adjusted earnings per share to range between $1.10 and $1.30, which is well below the $1.94 expected by analysts.
Qorvo's President and CEO, Bob Bruggeworth, stated, "In the September quarter, ACG successfully supported seasonal smartphone increases from our largest customer." He also added that the company’s High Performance Analog (HPA) and Connectivity and Sensors Group (CSG) segments are on track to achieve low double-digit growth year-over-year in fiscal 2025.
Chief Financial Officer Grant Brown noted that while the flagship and premium smartphone segments are in good shape, the company is experiencing a "negative mix" that is expected to continue into the second half of fiscal 2025. Brown also highlighted a shift in the Android market towards entry-level 5G phones at the expense of mid-range models.
In response to these challenges, Qorvo indicated it has taken measures including factory consolidation and reductions in operating expenses. The company now expects that the full-year revenue and gross margin for fiscal 2025 will be slightly lower than those for fiscal 2024.