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CIRRUS LOGIC, INC. (CRUS)·Q2 2026 Earnings Summary

Executive Summary

  • Record Q2 FY26 revenue of $561.0M driven by smartphone unit volumes; GAAP EPS $2.48 and non-GAAP EPS $2.83, with gross margin at 52.5% .
  • Both revenue and EPS beat Wall Street consensus; revenue $561.0M vs $541.4M consensus and EPS $2.83 vs $2.38 consensus; beats likely driven by flagship smartphone audio components and camera controller content strength in the early seasonality shift (camera content timing) . Revenue consensus $541.41M*, EPS consensus $2.38*; Values retrieved from S&P Global.
  • Q3 FY26 guidance: revenue $500–$560M, GM 51–53%, non-GAAP OpEx $128–$134M; implies down ~6% QoQ at the midpoint, consistent with earlier-than-usual seasonality shape driven by camera content .
  • Strategic momentum outside smartphones: first mainstream consumer laptop design secured; expanding collaboration with PC platform vendors; sampling voice/AI capture product in December quarter, creating medium-term growth optionality .
  • Cash and investments rose to $896.0M; strong FCF with TTM CFO $557.3M and Q2 FCF margin 16%; repurchased ~362K shares for $40.0M (remaining authorization $414.1M) .

What Went Well and What Went Wrong

What Went Well

  • “Record revenue for the September quarter driven by demand for components shipping into smartphones,” supported by strong flagship audio components (22nm smart codec and custom boosted amplifier) .
  • PC market traction: “secured our first mainstream consumer laptop design,” expanded collaboration with leading PC platform vendors, and developing voice/AI capture products (sampling in December) .
  • Non-GAAP OpEx came in below guidance on lower product development and employee-related expenses; non-GAAP operating income at 29.8% of revenue, aided by favorable mix and OBBBA tax benefit .

What Went Wrong

  • Android softness impacted non-flagship customer contributions; management acknowledged widely reported weakness and limited strategic investment in Android despite contribution .
  • Inventory reserves partially offset favorable mix on GM year-over-year; GM held at 52.5%, but higher reserves constrained expansion .
  • Sequential revenue guidance down for Q3 FY26 (midpoint implies ~6% QoQ decline), reflecting earlier-than-usual seasonality with camera content weighted to first half .

Financial Results

Revenue, EPS, Margins vs Prior Periods and Estimates

MetricQ4 FY25Q1 FY26Q2 FY26Consensus (Q2 FY26)
Revenue ($USD Millions)$424.5 $407.3 $561.0 $541.41*
GAAP Diluted EPS ($)$1.31 $1.14 $2.48 $2.38*
Non-GAAP Diluted EPS ($)$1.67 $1.51 $2.83 N/A
GAAP Gross Margin (%)53.4% 52.6% 52.5% N/A
Non-GAAP Gross Margin (%)53.5% 52.6% 52.5% N/A
GAAP Operating Profit (%)20.2% 17.8% 25.8% N/A
Non-GAAP Operating Profit (%)25.2% 23.3% 29.8% N/A

Consensus values marked with asterisks were retrieved from S&P Global.

Significant surprises: Revenue and EPS were above consensus (Revenue +3.6%, EPS +18.9%); smartphone-driven demand, HPMS camera controllers, and disciplined OpEx contributed to the beat .

Segment Breakdown

MetricQ4 FY25Q1 FY26Q2 FY26
Audio Revenue ($USD Thousands)$255,326 $240,043 $318,214
High-Performance Mixed-Signal Revenue ($USD Thousands)$169,130 $167,229 $242,746
Audio Mix (%)60.1% 59.0% 56.7%
HPMS Mix (%)39.9% 41.0% 43.3%

KPIs

KPIQ4 FY25Q1 FY26Q2 FY26
Cash & Investments ($USD Millions)$834.8 $847.8 $896.0
Inventory ($USD Millions)$299.1 $279.0 $236.4
Days of Inventory (days)N/AN/A~81
Cash Flow from Operations ($USD Millions)$130.386 $116.131 $92.214
CapEx ($USD Millions)$9.181 $2.770 $4.510
Free Cash Flow ($USD Millions)$121.205 $113.361 $87.704
FCF Margin (%)29% 28% 16%
Share Repurchases ($USD Millions)$100.0 $100.0 $40.0
Remaining Buyback Authorization ($USD Millions)N/A$454.1 $414.1

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
RevenueQ2 FY26$510–$570M Actual: $561.0M Within/Top-end
Gross Margin (GAAP)Q2 FY2651–53% Actual: 52.5% Maintained
Combined GAAP R&D + SG&AQ2 FY26$153–$159M Actual: $149.6M Lower vs guide
Non-GAAP OpExQ2 FY26$131–$137M Actual: $127.7M Lower vs guide
RevenueQ3 FY26N/A$500–$560M New (sequential down at midpoint)
Gross Margin (GAAP)Q3 FY26N/A51–53% New
Combined GAAP R&D + SG&AQ3 FY26N/A$151–$157M New
Non-GAAP OpExQ3 FY26N/A$128–$134M New

Management noted Q3 seasonal pattern shifted earlier due to camera content; midpoint implies ~6% QoQ decline .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 FY25)Previous Mentions (Q1 FY26)Current Period (Q2 FY26)Trend
Seasonality & Camera ContentFlagship products launched; camera controllers highlighted as differentiator Revenue guide up 33% QoQ; GM 51–53% Seasonality shifted earlier; camera content a greater piece Pull-forward into 1H
AI-enabled PCs & VoiceOn track; mainstream design win; top-5 OEMs shipping; SoundWire adoption New products improving voice/audio capture; collaboration with Compal First mainstream consumer laptop design; sampling voice/AI product in Dec quarter Accelerating
Android MarketContribution from boosted amps/haptics in Android Expect new Android flagships in 2H CY25 Android softness noted; limited strategic investment Soft
R&D Execution & OpExLower product dev costs timing; tape-out timing OpEx $119.5M; timing of tape-outs Non-GAAP OpEx below guide; shift in project timelines Disciplined
Tax & PolicyCapitalized R&D affected rates; FY26 non-GAAP ETR est. 21–23% OBBBA enacted July 4; evaluating impact OBBBA favorable; Q2 non-GAAP ETR 14.6%; FY26 ETR 16–18% Favorable tailwind
Shareholder Returns$500M authorization; $100M repurchased in Q4 $100M repurchased; $454.1M remaining $40M repurchased; $414.1M remaining Ongoing

Management Commentary

  • CEO: “Cirrus Logic delivered record revenue for the September quarter driven by demand for components shipping into smartphones… we remain focused on leveraging our mixed-signal processing expertise to expand our addressable market and drive long-term shareholder value.”
  • CEO: “We secured our first mainstream consumer laptop design… developing new products with superior voice and audio capture capabilities… expected to sample during the December quarter.”
  • CFO: “Non-GAAP operating expense… below the low end of our guidance range… due to lower product development costs… and lower employee-related expenses.”
  • CFO: “We recorded the favorable tax impact of the One Big Beautiful Bill Act… contributing to our lower non-GAAP tax rate of 14.6% for the quarter.”

Q&A Highlights

  • Seasonality shift: Management reiterated earlier seasonality driven by camera content and confirmed Q3 guidance aligns with this shape; only near-term guidance provided .
  • Battery/power initiative: CEO underscored valuable IP and active programs in battery performance, health, and efficiency; commercialization timing not yet disclosed .
  • OpEx timing: Lower Q2 OpEx due to spending delays and avoided expenses; willing to increase OpEx for high-confidence opportunities .
  • Android softness: Acknowledged impact; Android remains a contributor but not a core strategic focus; PC is the largest growth vector near-term .
  • AI PCs voice features: Strong OEM interest; voice wake and ultra-low-power standby highlighted; first device sampling in December quarter .

Estimates Context

  • Revenue: Actual $561.0M vs consensus $541.41M* — bold beat; driven by stronger smartphone units and new-gen products .
  • EPS: Actual $2.83 vs consensus $2.38* — bold beat; aided by favorable mix, disciplined OpEx, and OBBBA tax benefit .
  • Gross margin: 52.5% within guide; mix tailwind vs inventory reserves .

Consensus values marked with asterisks were retrieved from S&P Global.

Key Takeaways for Investors

  • Q2 FY26 delivered a clean beat on revenue and EPS versus consensus; margins held steady at 52.5%, with non-GAAP operating profit near 30% — a strong quality-of-earnings quarter .
  • Near-term: Expect sequential revenue down ~6% at midpoint for Q3 FY26 given earlier seasonality; monitor camera content trajectory and Android softness as potential headwinds/tailwinds .
  • Medium-term: PC momentum is building beyond premium into mainstream tiers; voice/AI capture silicon sampling in December could expand SAM and content per device in FY27+ .
  • Capital returns and balance sheet: $896.0M cash/investments, no debt; continued buybacks with $414.1M authorization remaining support EPS accretion and downside protection .
  • Watch OpEx cadence: Q2 non-GAAP OpEx below guide due to timing; expect normalization in Q3 within $128–$134M non-GAAP range .
  • Tax tailwind: OBBBA reduces effective tax rate (FY26 non-GAAP ETR 16–18%), supporting EPS leverage even with stable margins .
  • Stock catalysts: Continued flagship smartphone content, mainstream PC wins, and successful AI voice product sampling; any incremental camera controller/design-win disclosures or improved Android demand could drive upside .