The quarter was a modest beat, not a blowout. Non-GAAP EPS was $0.74 versus published consensus of roughly $0.71, while revenue of $1.604 billion was slightly ahead of the approximately $1.59 billion expectation. The result also landed above the midpoint of the company’s prior Q2 EPS and revenue ranges, but that was already the operating benchmark rather than a fresh surprise. (Financial Highlights; Third Quarter 2026 Outlook)
| Metric | Q2 2026 | Q1 2026 | Q2 2025 | Expectation / comparison |
|---|---|---|---|---|
| Revenue | $1,603.5M (Financial Highlights) | $1,513.3M (Financial Highlights) | $1,468.7M (Financial Highlights) | ~$1.59B consensus |
| Non-GAAP diluted EPS | $0.74 (Financial Highlights) | $0.64 (Financial Highlights) | $0.53 (Financial Highlights) | ~$0.71 consensus |
| Non-GAAP gross margin | 39.3% (Financial Highlights) | 38.5% (Financial Highlights) | 37.6% (Financial Highlights) | — |
| Free cash flow | $425.4M (Free Cash Flow reconciliation) | $217.2M (Free Cash Flow reconciliation) | $106.1M (Free Cash Flow reconciliation) | — |
The quality of the beat improved, led by power semiconductors and cash generation. PSG revenue rose 19% year over year to $829.0 million, while AMG declined 2% and ISG rose 7%; that makes the quarter’s growth concentrated rather than broad-based. (Revenue Summary) Non-GAAP gross margin expanded to 39.3% from 37.6% a year earlier, and free cash flow quadrupled to $425.4 million. (Financial Highlights; Free Cash Flow reconciliation)
The forward setup is solid but largely meets the bar. Q3 revenue guidance of $1.65 billion to $1.75 billion and non-GAAP EPS guidance of $0.81 to $0.93 imply midpoints of $1.70 billion and $0.87, respectively. (Third Quarter 2026 Outlook) Those figures are broadly consistent with published expectations around $1.70 billion of revenue and $0.87 of EPS, so the incremental surprise is in Q2’s execution—not a clear upward reset of the next quarter.
Net read: modestly better than expected, with AI demand becoming the key upside engine. Management now expects AI data-center revenue to more than double in 2026, and the filing adds new platform wins, GaN product expansion, and the planned Synaptics acquisition. (Business Highlights) Those items strengthen the growth narrative, but the quarter still shows weakness in automotive and only limited sequential improvement outside PSG; the filing therefore supports a narrow beat rather than a wholesale change in expectations.
Read the original 8-K on SEC EDGAR ↗