Synaptics (SYNA) 7 Nov 242025 Q1 Earnings call transcript

Good day, and thank you for standing by. Welcome to Synaptics' First Quarter Fiscal Year 2025 Financial Results Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to turn the conference over to your first speaker today, Munjal Shah, Vice President and Investor Relations. Please go ahead.

Kathy. you, Thank thank Synaptics' and for us joining Good quarter you, fiscal on first XXXX today afternoon, everyone, conference call. Munjal My Investor is Shah the I'm name Head Relations. and of

President Chief Financial today's Michael call With Officer. and me our Hurlston, on our Rizvi, Ken and are CEO;

accessed company's is be website being at and also Relations Investor call live over synaptics.com. the This web section the broadcast can from of the

Investor prepared Relations have to also presentation, posted remarks the on of copy addition our In we these website. supplemental a slide

the to excludes addition results, certain will acquisition-related financial comparable In the earnings synaptics.com. Investor or website issued measures company's to the management our presented, financial measures Relations most a company's directly and to recurring press accessed close also GAAP after section on results nonrecurring non-GAAP provide reconciliation release market refer from non-GAAP GAAP at can today items. other costs, which share-based supplementary be for noncash the the of or of basis, Please which compensation, a

we you our questions. projections conference conditions, to response prepared to forward-looking your the in business. and forward-looking statements make forward-looking of may results during remind and plans, in remarks statements statements that like Synaptics performance will operations, this make and call, to of current additional financial course expectations future These give Additionally, would relating our our objectives,

periodic Form from obligation forward-looking on that most materially our contained reports any to and we report in information. and filed to actual actual forward-looking risk risks future forward-looking factors report our to company's SEC, to important reasonable, subject quarterly refer for Therefore, results expressly be estimates update those Synaptics annual disclaims any with Form materially differ believes assumptions beyond Synaptics and differ the from in uncertainties XX-Q results performance and of Although our the XX-K any you company's statements. current could cautions a may Synaptics number statements. cause recent they are suggested control. including to on that the

now I will turn the to Michael. over call

to We product Revenue increased driven XX% to X% IoT everyone this range, welcome our strength to the sales, like were in today's I'd continued guidance very solid up performance which by midpoint Core compared delivered Munjal. call. exceeded of year-over-year prior the and year. Thanks, quarter.

continues profitability with operating with to margins delivered strong compared year year-over-year. and We quarter improve the higher and Our prior non-GAAP gross non-GAAP XX% EPS ago. growth EPS increasing to the

We by had another quarter and our processor IoT, led great in products. Core wireless

winning introducing designs, are and increasing new new We products, our pipeline.

in year XX% over compounded Core a increasing the of since Our from ago, nearly design This a about next to XX% over growth revenue update our billion $X.X XXXX funnel has to supports IoT last pipeline years. grown $X billion September today. X XX% of

part define a of our Day wireless, which as In wireless in lower requires markets, lower from market just broad making we year as approximately that a progress the market segment SAM we solution. this outlined a At Analyst ago, our over and $X connectivity billion. power we're cost

us allowing back chip to quarter, the time. market opportunity first from is on fab is sample address to broad track first and this this Our for

we years. X our in establish share over expect Given of differentiation, a the meaningful level markets to position next broad and build

wins to range broad nearly doubling and high-performance just accelerated, number new in continue spanned our a Wi-Fi, across wins of The new compared applications. and customers and with build pace ago, we X Meanwhile, position share months to customer of market in gains. as

market for track the month. sample IoT In first later device addition, the X we designed remain on specifically to this Wi-Fi

the share While leading still we to a continue modest, can in years. next our believe overall is we be that few player

processors. to Moving

the industry experts Learning Machine and the category. recently recognition XXXX Astra earned EDGE Deep Learning in from products by Our winning Awards

funnel growing gaining are traction solutions quarter. our with million the Our market $XXX in

has multiple in and date reducing hub Additionally, customers to connects automation, progress an for or connectivity. we to from interest for AI Our OEMs that and devices, designs for home are primary security eliminating seeing appliances, been need cloud the

Customers very way, AI a to bring existing as competitive our because edge capability In are replacement need made devices plug-and-play this to at AI points. drawn use they price decision be are products to the products MPUs. cases to because our immediately doesn't for

portfolio. improvement In across we're Enterprise Automotive, & seeing gradual the enterprise

by market Our benefiting share seasonality increased in PC revenue single-digit quarter, from gains. and percentage product incremental the high

notebook more Windows in an XX by stabilization AI appreciably the life, is didn't driven -- While a of PCs. end demand multiple as the will and XXXX belief XXXX was factors, and including of age in grow quite grow units PC new year there of market increasing expected, fleet, that the

fingerprint touch position growth top sensors, detection, and our beneficial be our market will numbers. pads any line presence user in Given to

in year, with Even next albeit 'XX, a limited off products base. growth expect FY our UPD in to units we small double relatively

reference Intel's Lake We their the both and wins ramping Panther major our are with customer progress The advantage design and our customer lead shows design platform. significant sit Intel have. for on we in

new those the to expect years. X to line differentiators to next able be other PC this applications, over and We product growing customers to bring revenue for

video our interface worked inventory. mostly life Next, again down are we products as of signs showing have

ago standard the improvement a Irrespective video still interface technology our market, improved normal the increased of requirements. compared While to are will or XXXX percentage PC double-digit upgrades from in below they and believe we to XX% year manageability due revenue quarter, these more products rate. run products the see

Thunderbolt example, devices include For X, models high-bandwidth latest will support year's and our uniquely its next requirement. notebook

higher enables of adoption Our latest it high more Carrera, interface product, charging video a and should capability. see displays, faster refresh rates, rate as

ARM-based product the this new is PCs. advent line of benefiting Further

agnostic newly support only Pro both and that the and processors. available introduced can is solution and DisplayLink Our CPU GPU ARM xXX

remain technologies. slowdown, given demand decline products actually market product cautious new of has broader In Automotive, legacy We and end-market continued regarding deteriorated products, these in this delays the were adoption line DDIC down the the year-over-year. in and

of with good touch our are are controllers the end seeing Mobile, market In strength. the and high aligned Android

major replacement with see win to with designs OEMs. down opportunities customers some and continue We market

also also nonmobile frequency-based potentially but not share should a new in applications. touch new handsets, are We controller, unlocks only introducing build which help

We to this quarter. prepared details provide will in on also more begin capital plan be remarks, share focus Ken our but repurchases. his deploying will

conclude, To while share in making high-performance gaining progress in IT, Core a we IoT market Wi-Fi, in Edge processors. foundation building are and broad connectivity

increase In product again improved sales Enterprise our addition, in are further and any growing should margins. end result demand in

shareholders. higher are starting we capital driving Finally, to earnings return to and

to a turn quarter me over of call our second results Let and Ken review financial the quarter outlook. first for

measures release the tables to everyone. remarks Investor section my I of Thanks, found the focus Michael, our our which GAAP non-GAAP in Relations to earnings in financial good on results, will and are afternoon website. reconciled

me for financial to turn let XXXX. fiscal results Now of quarter first our the

million, a up $XXX.X of improvement Core midpoint year-over-year with Revenue IoT, above and for were the across our up Enterprise & basis Automotive X% fiscal revenues sequential QX QX guidance, X% products. on and was Mobile sequentially.

X% was X% wireless XX% in Core overall the sequentially, sequentially on down product ramps Mobile XX% new Core the and first IoT, products. XX% Automotive year-over-year as year-over-year basis. a mix in revenues Enterprise Revenue and as IoT & increased XX% Automotive, further quarter improved as follows: end-market. and product revenue was XX% & recovery Enterprise reflecting well design

slowdown year-over-year gains impacted helped overall seasonality. which sequentially, and continued primarily improve were products products. and share both products, to in the The by PC the market by legacy was our due decline Our decline Automotive to

XX% high-end was revenue Mobile year-over-year product largely our driven And by X% a products Mobile the market. and reminder, sequentially. up are as Android

at During XX%. revenue, X of customers we each the quarter, approximately had greater XX% than

the midpoint XX.X%, above First gross quarter of was margin non-GAAP guidance. our

range. First quarter and operating guidance at million our non-GAAP was midpoint expense of $XX.X the

operating strengthened driven again year-over-year by points quarter, controls. non-GAAP expense up by operating improved in XX.X%, basis over at over and XXX by coming on revenue a and sequentially, XXX the income Our up first in basis points continued basis

our in Non-GAAP Non-GAAP was a midpoint net XX% increase QX per guidance sequentially. diluted basis the an on came share, share income of $XX.X at XX% per $X.XX in year-over-year and above EPS of million.

was approximately Now sheet. equivalents, the $XX.X the $XX payment turning operations with our cash cash to ended from used million quarter. intellectual in cash $XX primarily and million, million property onshoring quarter. balance the of of taxes cash approximately onetime prior a down the related million the of $XXX last including Cash due to quarter We to

and $X.X the for depreciation down were Receivables XX days from and were quarter. million end days $XXX.X the quarter million, at of sales was last XX days, $X.X million. September expenditures Capital were outstanding

sheet Our customer support were ending slightly balance balance was inventory days. demand XX for compared The calculated to up quarter. million, last $XXX.X inventory to our on quarter second days of our the

turn to our priorities. Now let capital me allocation

as First, Enterprise in especially & invest IoT we our we our Automotive products. see opportunities continue will organic and Core growth, to for in business significant

last the in M&A which augment successfully internal manner, we Second, several over done with continue to we our years. will a have disciplined capabilities

to Third, balance we allocate profile, share manner. an will repurchases. and sheet capital will and maintain efficient finally, strong nimble capital return we us a enabling And liquidity in via to remain continue

our ample balance Today we powder operational is for dry addition, have in than cash acquisitions. requirements. higher tuck-in And our

to As a continuing to sheet. our while intend cash return strong shareholders, portion a a of we balance also result, maintain to

approximately next of the million fiscal $XXX cash earmarking XX free XXXX are We or months. over flow XXX% repurchases the share for generated in

second our turn me of let quarter Now guidance. XXXX to

at million. expect $XX We plus approximately revenues the be million midpoint, $XXX to minus or

quarter approximately Our in guidance IoT, XX%, and quarter Core be products revenue XX%, Enterprise Mobile from & XX% an expected mix respectively. second reflects and for the second Automotive the to

and in to at XX.X% plus and of be the quarter the non-GAAP December other million $X or the expense Non-GAAP $XX or in And approximately range be quarter minus the at XX% minus million midpoint, of to to tax interest operating approximately million. is margin gross expect XX%. non-GAAP expect our be to net expected be $X guidance, the plus in non-GAAP We we X%. expense to December rate midpoint

Non-GAAP net diluted plus per fully $X.XX minus million at income midpoint, or on be an per estimated anticipated is share the to shares. XX.X diluted $X.XX, share

another expecting are growth in We QX. sequential quarter of

normal challenges, also have our is channel our even and and inventory internal below lean inventory pockets. in through certain worked We

the while However, overall also ensuring adequate relatively as appropriately growth. business still for we expenses revenue to muted, continue and manage long-term will our investments is growth

I'd our the to prepared turn to the the start like This wraps session. call to Q&A up operator over remarks, and

[Operator Rolland comes line of from with Instructions] Our first Christopher the question Susquehanna.

market I Congrats lines coming, that for could Have guys chip broad you in pulled I on the products. you chip And talk you perhaps term? first for any have out? time of in and road about any new moved or quarter. a expectations your near maps the guess, think all,

thanks much. our in question, talked in Wi-Fi very the and the for for remained target have on a applications, the this area being some that paying Appreciate and to call. chip sample about sample a to quarter. think markets position We thanks quarter attention Number X question consistent. about I lines broad our speaks one, it Chris, for to, much that's chip again, it, we And for IoT talking target. to very Wi-Fi spent on time this your time

So we've well. held our schedules fairly

of I processor obviously processors. AI think area, the in with we're our production several Edge in

a have year. one out midyear next big pretty coming We

So is holding. schedule that also

So in those hitting IoT I'd the generally, Core say, we're giving area, schedules, schedules.

I a think done team the good engineering has job.

that and markets, $XXX expecting track. and segments: BLE, when from Analyst that X you high New came broad performance, frame are think I think I million talked XXXX time in we particular we to the the in unit, was on Day respect revenue markets about if the With appears roughly that markets, to remember broad York, just contribution you broad

that sales good be in But frame. above that a to the somewhere number, new we've of markets, traction. we're sort the would million outlined that that in $XXX I given funnel, contributor time right And now. very I'd think say generally XXXX the that to don't million $XXX give I we're in early given seems generating number, want tracking broad Given opportunities

you is a perhaps to most follow-up How years, How be like How XX% is also excited Just and Where where XX% coming XX% processors? maybe much IoT there. seems Michael, finer think is on where here coming Perhaps great really revenue strong growth like growth great track the put the Excellent. really Wi-Fi? you XX%. next up to growth. point to is a on kind CAGR, to is funnel, it that Bluetooth? over there, you're Core to from? X much much going needle-moving work from of can

obviously, think Very all I Wi-Fi. term, Yes. good I it's question, Chris. mean near

just this don't through contributions all start is XXXX, XXXX carries That broad given initiative, In from narrow funnel. exceeding kind existing its we that our us I'd well, design these call, and We've actually, processor got we wins of know the processors, as Wi-Fi, We're focused point say, this we are of sampling high-performance out to to in knee-up very this schedule. And right? then the start to you markets So think our I AI see the XXXX, But have the coming in going early contribute verticals expect 'XX. fiscal at really 'XX, of the chip. mean revenue fiscal in that we we'd to today. as kind again, projections in but well. super relative meaningful year. with are capability, contributing doing of market broad revenue late our first processor it's see expectations outlined fiscal contributing in seeing I

of kind that's rank So the order.

BLE, you talked about.

we the which Day, got to in Analyst of right the projection BLE BLE, now, I of very BLE -- one was behind between the think look we gave Wi-Fi a a up think can area segments. contribution, That's say million our got little opportunity, I look we a accelerate we somewhere how our are million carefully at so Chris, strategy. way tracking to XXXX $XXX where find at $XX our behind in to at bit. tracking you bit stack I on smallest SKUs BLE. and X we're But the would and that to We've

AI That product too. really sounds cool, Excellent.

Our Rosenblatt with Cassidy Securities. question comes of the Kevin next line from

you're what's description and getting line Wi-Fi would it give same congratulations results, cycles? more as that compare great Maybe to Chris'. market. as question past in coming upgrade upgrade maybe a pull my question, that Wi-Fi -- My give how the along cycle that? you market, The are is you into on the Is just happening of me that on X,

segment go of of always, function attention about of just get XX% the to talked up, XXXX, the start one X us in big that something you to certain X because I to standards, little like paying the do. would any thanks video that curve. really before: probably are from all takes to say shipments. kind company probably as I XX% is it for XX% X. right? a see things of get actually. about and you're you X And that going going transfer XX%, the penetration and markets a than very the have Kevin, set-top sort kind pretty Wi-Fi you to in thinking XX% lot we'll -- naturally time to then of in the penetrated, expect consistent we'd a earlier legacy giving A more by never penetration, Wi-Fi to step XX% nature. Then standard products happens very going of they're you you're to, to to good drones, to than and devices where function Yes. That's what takes our coverage years, mixing we've step probably last XX% IoT fiscal rapidly, to gravitate mean that to then to occupy XX% Wi-Fi say, of broad the X, there from the some boxes, relatively see let's kind normal

to X getting older a probably and to in XX% in occupy step-up do as to good to going a have Wi-Fi then You're Wi-Fi similar you're that see chunk X, going you technologies XX%.

kind more to up to and of of us much of shipments would norms. dribble fast defy XX% a share step for a there But X, market. XX% all normal we to of So on kind the up would from step Wi-Fi that fairly slow expect of expect then historic kind than a

Great. Okay.

you're your map they for as showing cycles. with you long through as stay so upgrades, And product road the customer

XX%, obviously and below on, Wi-Fi overall X is And still the X into X maybe share at Yes. of probably that Wi-Fi XX%, share. works, X now significant comes a penetrated. is slightly Kevin, market. in the I way X when occupy it will it ease mean Wi-Fi Wi-Fi

as Wi-Fi X little get out out. X start X, Wi-Fi now you'll X. similarly, good Wi-Fi squeezing and comes squeezed So Wi-Fi for And X see there will X, get still period when then Wi-Fi see very to a online, of probably X we X, hang probably and in to you'll Wi-Fi time,

kind it that's of how So works.

on standard the time, us, we application, X. much those covered on. now, is point somewhere just news one right between and and The good the of and standards depends at have price and pretty have You it least any X, shipping for X X X, X all at so

good So pretty we're in shape.

is little happening still see detail, in and consumer, home been Maybe earnings maybe for maybe say, far, versus Great. as are exposures that getting Okay. industrial? in the end-market better. just Wi-Fi end-market. I'd more what seems a what It has to is like in consumer, the industrial home, But you the period your this weak hear IoT, in

Yes.

industrial. We little have very

one. that's So

little very automotive. have We

win. one I talked about think we've

with We calls to earnings yet I so market speak are think progress making win of X nothing of about one in ago. but outside talked automotive Wi-Fi, the our we or

of business, consumer how know, reasonable That's XX% Munjal, mix Our kind exposure is probably, and enterprise. about a don't think we then of predominantly Wi-Fi enterprise. the XX% consumer, I

Yes. Michael right other That's industrial way some may a And primarily is to we end-markets. it. enterprise, your think the end-markets, right, to automotive. But some main have about and to no consumer, little

comes Krish question Sankar the line next Cowen. of with from Our

one sequential Michael, you year is growth every had nice quarter. revenue this

Or seasonality this can quarter, into avoid have shoots to So growth look you any do as cadence? expect we in there you the think . impact March? that March do are green seasonality revenue

fiscal at question seasonality, at don't X provide and Yes. would the Thanks, -- ongoing March, quarter. QX. guided space the guidance PC as we But typically look Chris. It's we into Ken we ahead, into look right, here. our some like we than support. especially if more areas look quarter we Appreciate the If we for see March

little right March those And impact now, X the the to so seasonality. a So little is of automotive a expect factors quarter. we we'd expect sluggish, bit market

quick it. And follow-up. then Got just a

to ASP differential X. the about of curious Wi-Fi gross the Wi-Fi kind how to about lot X compared and a I'm think Wi-Fi between spoke You margin X.

Yes.

We Krish. first-mover advantage, have a

somewhere like a So $X to range and like-for-like. on our we ASP the definitely position. It's probably $X margin in

Of and think going probably somewhere you if about get $X course, X-by-Xs. uplift, have uplift. in But ASP and basis, a to between you X-by-Xs you're to the margin on a and like-for-like X% XX% $X

a over we're price we competition. that maintain know. given market, a first-mover a pretty or think able That competitive -- to lot will Wi-Fi But that for until decay advantage, we year we start could our you seeing would more just as time. so is

Our next line Needham Bolton Quinn question comes from the with Company. & of

wanted follow-up green shoot that kind to to a question. just of start I

was, growth, And if you sounds like better expand You just could starting saw seeing enterprise X% on of or stabilization to you what outlook. wondering I IT. And think it you're seeing signs firm? to see Are IT budgets Enterprise. in least you quarter-to-quarter perhaps be it a might maybe demand starting corporate at in

processor can especially second describe see to starting the is: the you then And and wireless the environment it across in Is you're what pricing you general some from question Are the competitors? stable? -- Asia on or just pricing seeing segment? pressure,

Yes. Thanks, Quinn.

think of much seeing a in it's got time IT for not and you while. the certainly some right. results We're liking tenor in I better by tone driven First area. that totally I'm are uptick magic We sure Enterprise first the spending. the necessarily all, enterprise in

our cases by adoption. that talked compelling use being it's driven think up interface I cycles, new products There introduced are devices a driving refresh have X pretty about that we we've sequentially. lot video

that's say there. So happening I'd

some of gains with share in have In PC, some PC bubbling incremental actually we've area. that market, the led think revenue but kind growth to had the we're I

budgets talked we being like could We longer, So a about, expect for get It assets to that a about IT looks better. as for the sense the that all coming sweat budgets. we that necessary if IT now-ish, we've better things be we've looks to roost, updates you the talked much relative will better. that feel be look would portfolio, across like

up, that good. pretty I And who Ken where so to QX, good but generally, think of seasonality which provide it's I it outside in feel think of the we knows about caution, some ends some talked

that challenging. Yes, certainly not in Quinn China certain extent, We have good we Still also highlighted, been Wi-Fi, it We of that it. about a don't environment asked we've question. see exposure. Mobile, has a to in pricing. pricing a Yes, see areas the lot the

the is -- bit as pricing And challenge. a environment, a so understand, of we that Chinese little

even historically pressure was But words, is at XXXX, price XXXX, as maybe holding of relatively well. bad Yes, others. business, pressure, some if think in hold I now don't up of It XXXX. pricing But touch Wi-Fi it's the semiconductor there other the nearly right mostly, the plus. I it pricing. be would as I I to in to able pockets say the we're mean, controllers, look seems it are

suppliers side, of On other side. on lot from help the a reductions on the cost input the we see don't

Yes. the have, pricing have It's there's to jump our I'll very well, so the you. And Quinn, little serve of position. here at very you some that products, if maybe talk some say, we Good in and we I'll look pressure of markets positions, we just given those products just as Ken. print on print to strong

line of JPMorgan. comes question next the from Peter Peng Our with

Congratulations the sounds direction. kind to in guidance. is is the have kind of a you like Enterprise this? strong muted? we does Core move this what of finally Do segment? Does would how right of implications of about this And starting more profile How higher-margin recovery It the kind would then think the you given observe margin in this think is follow IoT? this on that

and think We spending. really I budgets with we've IT mean signs on see I going news. Yes. depend of what good that's life, to IT a it's consistent definitely so said previously,

in our the new and some gains to market share I are right. things like -- do mostly previous the headline from said question got things control, that. think think that think kind features, Quinn, I some by I it's I of as driven that's you

But feel would haven't spending in that XXXX. IT better we we happening I say now of aggregate, about On lot seen increases. a

video margin. we telephony, up, Always products, help If our our happen, the look, products, our that able prepared in said really that to margins remarks, should that increase And we what If comes profile. within of are margin like of by a right. we're I mix. won't PC you're a better the lot ship. some on mix enterprise mean impacted the see help on interface some our whole audio does it's

on where comes -- is PC segments margin, in it terms other of or bit product definitely will it of in these So lines where from. up. drag depends with corporate line a the kind will it average

Great. in thanks is any on and your perhaps Maybe Astra give if on for terms you color platform. more your us Is concentration? color provide customer My it? follow-up could for -- you of some there funnel disclosing can that. your Maybe engagement. How is broad some geographic

on Yes. we're right the topic. on mean just and on finding segments, mean it's now is generally I answer I And division opportunities we fit. and was leader the to call our going right broad. is pretty best debating it's The phone what's we're question. prior where our I out to trying across just hunting figure this we're

cost, ops price unique. low capable $X enabling They're of power, quite these talking very low that of XX, We're kind and very our are compute. inferencing tera products $X, XX of. in super point, of mean I bit this about $X, devices are a

put Kevin segment lot asking of appliances, home security, can different different which in fit end they I you was ago. think a was -- go. that somebody about was -- lot together, maybe we of So industrial, a applications: home There's a in minute can automation, that it areas

broad devices. going of with kind we're now, these right So

the probably after or narrow quarter, X really really process X next Our year, second on down to finish and is quarter go exploration segments first it. goal and

that. So mean we of I we A about in speaks to size good feel lot are. area. the opportunity where funnel this

in replace we capability. value look, no right -- is, As plug-and-play customers to this then I increase of we're fashion, type you and said, all proposition cost at competitors from processors all, our now can our a get AI

go, figure your need you're the shoe. of AI to So that in mind good don't when to use case, have out right and you you out

remarks. you. Thank back showing questions for Michael it to further would like Hurlston and to this at closing time, now I'm turn no

quarter. all you today. you thank forward like to I'd for to during joining conferences look upcoming Thanks much. speaking us of at We so the investor our to

Thank does may and you the This conclude you. now program, disconnect.