Synaptics Incorporated earnings

Management highlights

- Physical AI and edge AI adoption is accelerating with customer engagements expanding, including in robotics with over 35 global customers. - Partnership with Google launched Next Generation Coral Board powered by Astra SL2610 processor. - Made progress on next generation Astra SR series microcontrollers, with PSOC taped and sampling expected in fall. - Secured Astra processor wins in medical devices, industrial, and various other markets. - Successful launch of Astra enabled connected MCU at Embedded World, sampling with multiple customers. - Enterprise and mobile touch: enterprise demand improving, mobile touch well-positioned with some OEMs.

Guidance

- Fiscal 2026 Q4 revenue expected to be approximately $305 million at midpoint, plus or minus $10 million. - Revenue mix expected to be approximately 33% core IoT, 54% enterprise and automotive, and 13% mobile touch. - Non-GAAP gross margin expected to be 53.5% at midpoint, plus or minus 1%. - Non-GAAP operating expenses expected to be $105 million at midpoint of guidance, plus or minus $2 million. - Non-GAAP net interest and other expenses expected to be approximately $2 million. - Non-GAAP tax rate expected in range of 13% to 15% for Q4. - Non-GAAP net income per diluted share anticipated to be $1.20 per share at midpoint plus or minus 15 cents on an estimated 40.4 million fully diluted shares.

Segment performance

Fiscal third quarter revenue was $294.2 million, up 10% year-over-year. Core IoT product revenues increased 31% year over year, accounting for 30% of Q3 revenue. Enterprise and automotive product revenues were up 9% year over year, making up 57% of Q3 revenue. Mobile touch product revenues decreased 16% year over year, representing 13% of Q3 revenue. Non-GAAP gross margin was 53.6% in Q3.

Analyst Q&A

• Q: On core IoT volatility and Astra platform revenue contribution.

  A: Ken said core IoT has solid performance with growth expected, Rahul said Astra ramp anticipated in 2027 with semi-custom solution for large OEM.

• Q: On PC, mobile, memory headwinds.

  A: Ken said PC may have headwinds in second half 2026, mobile touch is beneficiary with Korean OEM.

• Q: On robotics attach rate, geography of pipeline.

  A: Rahul said majority shipments on tactile sensing and bus interface, pipeline highly concentrated in North America, some in China, early in Europe.

• Q: On Astra end markets, ramp.

  A: Rahul said consumer ramps first, industrial follows, semi-custom design for large OEM.

• Q: On gross margin, Astra ramp.

  A: Ken said margin range, core IoT processing capabilities will help overall mix.

• Q: On semi-custom chips, new product revenue ramps, Broadcom IP.

  A: Rahul said interest in semi-custom, Astra revenue ramp in 2027, Broadcom IP evaluated.

• Q: On robotics engagement, capacitive sensing advantage.

  A: Rahul said direct engagements, capacitive sensing excels in signal-to-noise, accuracy, etc.

• Q: On robotics cross-selling, core IoT growth rate.

  A: Rahul said cross-selling in robotics, Ken said core IoT has good growth with expected acceleration