Q4 2024 Earnings Summary
- Qorvo is confident in gaining market share and growing revenue with its largest customer, expecting to gain share in FY '25 and FY '26 and grow revenue.
- Strong tailwinds in the defense business are expected in the fiscal second half, driven by recent congressional budget approvals and increased order activity.
- Anticipated gross margin expansion as factory utilization improves, with gross margins expected to be the low point in the June quarter and improve substantially in the September quarter.
- Modest Revenue and Gross Margin Growth Expectations: Qorvo projects only modest growth in both revenue and gross margin for fiscal 2025.
- Flat Outlook for Android Business in June Quarter: The company expects its Android business to be flat in the June quarter, potentially signaling challenges in that market segment.
- Limited Contribution from Anokiwave Acquisition to Mobile Segment: Qorvo does not plan to integrate Anokiwave's technology into the mobile phone segment, focusing instead on defense markets, which may limit growth opportunities in mobile.
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Fiscal '25 Growth Outlook
Q: Will revenue and gross margin grow modestly in fiscal '25?
A: Yes, we expect to grow both revenue and gross margin modestly in fiscal '25, absent any macro-related disruptions . This growth is driven by content gains at our largest customer and success in the defense market . -
Confidence with Largest Customer
Q: Any change in outlook for share gains with largest customer?
A: We are very confident in our outlook with our largest customer, expecting to gain share and grow revenue in FY '25 and FY '26 . -
Gross Margin Improvement
Q: How will you improve gross margins back to peak levels?
A: We are improving utilization, optimizing manufacturing, and focusing on high-margin businesses like defense . Utilization across our U.S. fabs increased by 20 percentage points, from the 40s to the 60s . -
Android Business Outlook
Q: What's the outlook for Android business in June?
A: The Android business is likely to be flat in June . We're offsetting a decline from a big flagship ramp with growth elsewhere . -
Segment Growth Expectations
Q: Are you expecting growth across all segments in fiscal '25?
A: Yes, for the full year, we expect growth across all segments . -
Silicon Carbide Business
Q: What's the outlook for silicon carbide business?
A: Our silicon carbide business is mixed . Success in data centers, but areas like solar are soft due to the interest rate environment . It's a small but growing business with opportunities . -
Anokiwave Acquisition Focus
Q: Is Anokiwave acquisition focused on mobile?
A: No, the acquisition is focused on defense . We have no plans to bring it into the mobile business . -
Revenue Seasonality
Q: How will fiscal '25 revenue shape compare to '24?
A: Similar to fiscal '24, but we expect a larger December quarter than September . September and December will be our largest quarters . -
Inventory at Largest Customer
Q: Are you seeing inventory build at your largest customer?
A: No, we do not see any channel inventory between us and our largest customer . We ship directly to their manufacturers . -
Capital Intensity Targets
Q: What are your capital intensity targets?
A: We plan to spend CapEx around a 5% target level over time . It may vary based on capacity needed to support demand .