Executive Summary

Q2 FY25 revenue was $267.2M and non-GAAP EPS $0.92, up 13% y/y and 4% q/q; results were slightly above the midpoint of guidance, with non-GAAP gross margin at 53.6% and non-GAAP operating margin at 17.3% .
Management guided Q3 FY25 revenue to $265M ± $15M, non-GAAP GM 53.5% ± 1%, non-GAAP opex $101M ± $2M, and non-GAAP EPS $0.85 ± $0.20; guidance includes a partial contribution from the newly signed Broadcom agreement .
Core IoT remained the growth engine: product sales rose 63% y/y to $61M; company mix was 23% Core IoT, 59% Enterprise & Automotive, 18% Mobile Touch. Auto remains sluggish; Mobile Touch headwind from a large U.S. customer is now behind the company, with focus shifting to high-end Android .
Strategic updates: Synaptics signed a definitive licensing agreement with Broadcom (Wi‑Fi 8/7, UWB IP, GPS/GNSS), expected to add $40M+ annualized sales and be accretive to non-GAAP EPS; $74.5M share repurchases (~1M shares) in Q2; CEO transition to Interim CEO Ken Rizvi (CFO) announced Feb 3 .

What Went Well and What Went Wrong

What Went Well
- “We delivered another solid quarter, marking our third consecutive quarter of both sequential and year-over-year revenue growth… Core IoT products grew 63% year-over-year” (Interim CEO/CFO Ken Rizvi) .
- Non-GAAP gross margin of 53.6% was slightly above the midpoint of guidance; non-GAAP EPS grew 61% y/y to $0.92, driven by revenue growth and expense control (non-GAAP operating margin 17.3%) .
- Broadcom agreement accelerates Edge AI strategy and expands field of use to Android smartphones, AR/VR and consumer audio; management expects $40M+ annualized sales contribution and accretion to non-GAAP EPS .
What Went Wrong
- Automotive exposure remained a headwind (most exposure U.S./Europe); management expects similar sector headwinds to persist near term .
- Mobile Touch revenue declined 25% y/y and 7% q/q as shipments to a large U.S. customer reached end-of-life; mix now focused on high-end Android .
- Cash fell to $596M (from $854M in Sep) as the company retired its $582M Term Loan B and repurchased $74.5M in shares; while leverage improved (LT debt to $832.5M), liquidity stepped down q/q .

Financial Results

Metric	Q4 FY24	Q1 FY25	Q2 FY25
Revenue ($M)	$247.4	$257.7	$267.2
GAAP Diluted EPS ($)	$5.22	($0.58)	$0.05
Non-GAAP Diluted EPS ($)	$0.64	$0.81	$0.92
GAAP Gross Margin (%)	45.8%	46.9%	45.7%
Non-GAAP Gross Margin (%)	53.4%	53.9%	53.6%

Additional Q2 points:

Revenue growth: +13% y/y and +4% q/q; non-GAAP EPS +61% y/y (management) .
Non-GAAP operating margin: 17.3% (up ~360 bps y/y, +60 bps q/q) .

Non-GAAP adjustments (Q2):

GAAP net income $1.8M vs non-GAAP net income $36.6M. Key exclusions: $26.0M acquisition/integration, $34.6M share-based comp, $0.8M restructuring, $6.5M loss on early extinguishment of debt, and ($33.7M) non-GAAP tax adjustments .

Segment/End-Market Mix and KPIs (Q2):

Mix: 23% Core IoT; 59% Enterprise & Automotive; 18% Mobile Touch .
Core IoT revenue: $61M (+63% y/y, +3% q/q) .
Enterprise & Automotive revenue: +17% y/y, +8% q/q .
Mobile Touch: –25% y/y, –7% q/q (EOL at large U.S. customer) .

Balance Sheet and Cash Metrics (Q2):

Cash & cash equivalents: $596.1M (Dec) ; convertible notes $450M @ 0.75% due 2031; retired $582M term loan; ending LT debt $832.5M .
Share repurchases: ~$74.5M (~1M shares) .
Cash from operations: $24M in the quarter (company commentary) .
DSO 49 days (47 prior qtr); inventory $119.5M; inventory days 87 .

Consensus vs Actuals (Q2):

Wall Street consensus from S&P Global was not available at request time due to an SPGI rate limit; therefore, we cannot quantify beat/miss vs Street. Values retrieved from S&P Global were unavailable at runtime. Management stated revenue and margins were slightly above guidance midpoints .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	Q3 FY25	N/A	$265M ± $15M	New
GAAP Gross Margin	Q3 FY25	N/A	45.2% ± 2.0%	New
Non-GAAP Gross Margin	Q3 FY25	N/A	53.5% ± 1.0%	New
GAAP Operating Expense	Q3 FY25	N/A	$141M ± $3M	New
Non-GAAP Operating Expense	Q3 FY25	N/A	$101M ± $2M	New
GAAP EPS	Q3 FY25	N/A	($0.47) ± $0.30	New
Non-GAAP EPS	Q3 FY25	N/A	$0.85 ± $0.20	New
Non-GAAP net interest & other	Q3 FY25	N/A	~$1M expense	New
Non-GAAP tax rate	Q3 FY25	N/A	13%–15%	New
Segment mix (Core IoT/Enterprise & Auto/Mobile)	Q3 FY25	N/A	~25% / 58% / 17%	New

Notes:

Guidance includes a partial-quarter contribution from the Broadcom asset acquisition; full quarterly contribution expected in the June quarter .
Company notes GAAP outlook does not yet reflect purchase accounting adjustments for the Broadcom assets pending valuation completion .

Earnings Call Themes & Trends

Topic	Q4 FY24 (Q-2)	Q1 FY25 (Q-1)	Q2 FY25 (Current)	Trend
Core IoT growth	Core IoT grew 63% y/y in Q4; focus on wireless momentum	Core IoT +55% y/y; double-digit seq growth 3 straight quarters	Core IoT +63% y/y to $61M; wireless sampling Wi‑Fi 7; PacketCraft BLE software acquired	Sustained acceleration
AI/Edge (Astra)	Positioning Astra for content gains longer term	FY25 strategic momentum; Astra highlighted as LT driver	Google collaboration integrating MLIR-compliant core; emphasizes inference-per-watt leadership	Strengthening ecosystem
Broadcom agreement	N/A	N/A	Definitive agreement (Wi‑Fi 8/7, UWB IP, GPS/GNSS); $40M+ annualized sales; accretive to non-GAAP EPS	New positive vector
PC/Enterprise	Entering FY25 “in a much better position” post supply chain issues	Inventory headwinds reduced; new designs ramping	No refresh cycle yet; UPD wins at two major OEMs; improved bookings/orders	Gradual improvement; potential refresh catalyst
Automotive	N/A	N/A	First SmartBridge win in China; sector headwinds near term (U.S./Europe exposure)	Mixed: LT potential, NT headwinds
Mobile Touch	N/A	N/A	EOL headwind at large U.S. customer behind; focus on high-end Android; China OEM mix up with flexible OLED	Transition to Android premium
Capital allocation	N/A	N/A	Retired term loan; issued $450M converts (0.75% due 2031); $74.5M buyback	Delever + buybacks

Management Commentary

“We delivered another solid quarter… Core IoT products grew 63% year-over-year… our strategic transaction with Broadcom further strengthens our Core IoT position.” – Ken Rizvi, Interim CEO & CFO .
“Our guidance reflects continued year-over-year growth… strong balance sheet and positive cash flow… capitalize on both organic and inorganic growth opportunities, while also returning capital to shareholders.” – Ken Rizvi .
Broadcom agreement “accelerates our Edge AI strategy… expands our field of use… solidifies our wireless roadmap for the next 5-plus years… positions us as one of the largest and most qualified teams in cutting-edge wireless R&D.” – Ken Rizvi (prepared remarks) .
On Astra/Google: “This partnership speaks to our credibility… expected to deliver industry-leading inference-per-watt… create opportunities in future Google and non-Google devices” .

Q&A Highlights

Broadcom contribution: ~~$40M annualized sales (~~$10M/quarter), fully reflected starting June quarter; falls under Core IoT .
Sequential growth path: Management sees a path to grow roughly $10M sequentially each quarter through calendar 2025, contingent on macro; Broadcom supports near-term, Astra ramps remain FY27 timeframe .
Mobile/Android opportunity: Field-of-use expansion enables pursuit of Android smartphone and AR/VR customers; too early to call if Mobile or IoT will be larger in 2–4 years; UWB currently IP, potential standalone or integrated later .
Enterprise/PC: Improved bookings/orders; UPD wins at two major OEMs; still no broad refresh cycle, but potential in 2025–2026 .

Estimates Context

Street consensus (S&P Global): Unavailable at the time of request due to SPGI rate limit; as a result, beat/miss vs consensus cannot be quantified. Management indicated Q2 revenue and non-GAAP gross margin were slightly above guidance midpoints, and non-GAAP EPS exceeded the midpoint of guidance .
Where estimates may adjust: Given sustained Core IoT momentum and the Broadcom partial contribution in Q3 (full in June), revenue trajectory and mix could shift upward; however, automotive softness and Mobile Touch transition temper the near-term outlook .

Key Takeaways for Investors

Core IoT is the primary growth driver, up 63% y/y to $61M; Broadcom license should add ~$40M annualized sales with field-of-use expansion into Android/AR/VR and consumer audio – a medium-term TAM and revenue catalyst .
Management outlined a sequential revenue growth path (~$10M per quarter through CY25), with partial Broadcom contribution in March and full benefit by June; monitor execution vs this trajectory .
Margin structure appears stable (non-GAAP GM ~53.5%–53.9%); mix shifts (IoT vs Mobile vs E&A) will drive variance; watch Q3 mix (25%/58%/17%) and Broadcom integration dynamics .
PC/Enterprise: UPD content gains at large OEMs and a potential enterprise refresh cycle (2025–2026) could provide incremental upside; near-term visibility improving but not fully robust .
Automotive remains a near-term drag (U.S./Europe exposure); China SmartBridge win is a positive but likely longer-dated .
Capital allocation is shareholder-friendly and balance-sheet conscious: term loan retired, low-coupon converts issued, $74.5M buyback in Q2; liquidity remains strong with $596M cash at December .
Stock catalysts: evidence of Android wins from the expanded wireless portfolio, confirmation of sequential growth pace, additional Astra ecosystem milestones (Google collaboration), and signs of an enterprise PC refresh inflection .

Appendix: Detailed Quantitative Tables

Revenue and EPS vs Prior Year/Quarter and Guidance

Metric	Q2 FY24	Q1 FY25	Q2 FY25	Notes
Revenue ($M)	$237.0	$257.7	$267.2	+13% y/y; +4% q/q (mgmt)
GAAP EPS (Diluted)	($0.23)	($0.58)	$0.05
Non-GAAP EPS (Diluted)	$0.57	$0.81	$0.92	+61% y/y (mgmt)
Non-GAAP GM (%)	52.5%	53.9%	53.6%	Slightly above guidance midpoint
Q2 Guidance Midpoint (from Q1)	—	—	Rev $265M; GM 53.5%; EPS $0.85	Actual slightly above midpoints (mgmt)

Q3 FY25 Guidance Detail

Metric	Guidance
Revenue	$265M ± $15M
GAAP GM	45.2% ± 2.0%
Non-GAAP GM	53.5% ± 1.0%
GAAP Opex	$141M ± $3M
Non-GAAP Opex	$101M ± $2M
GAAP EPS	($0.47) ± $0.30
Non-GAAP EPS	$0.85 ± $0.20
Non-GAAP net interest & other	~($1)M
Non-GAAP tax rate	13%–15%
Mix (Core IoT / E&A / Mobile)	~25% / 58% / 17%
Notes	Includes partial Broadcom contribution; GAAP excludes purchase accounting pending valuation

Segment/Mix KPIs (Q2 FY25)

Segment/Metric	Q2 FY25	y/y	q/q
Core IoT revenue ($M)	$61	+63%	+3%
Enterprise & Automotive mix	59%	+17% revenue	+8% revenue
Core IoT mix	23%	—	—
Mobile Touch mix	18%	–25% revenue	–7% revenue

Balance Sheet/Cash KPIs (Q2 FY25)

KPI	Value
Cash & Cash Equivalents	$596.1M (Dec)
Long-term Debt	$832.5M (Dec)
Share Repurchases	~$74.5M (~1M shares)
Cash from Operations (quarter)	$24M
DSO	49 days
Inventory	$119.5M; ~87 DOI
Convertible Notes	$450M @ 0.75%, due 2031; capped call to ~$150

Other Notable Events

CEO transition: Michael Hurlston stepped down; Ken Rizvi appointed Interim CEO; preliminary Q2 revenue disclosed ($267M) ahead of earnings .
Broadcom agreement: definitive licensing for Wi‑Fi 8/7, UWB IP, GPS/GNSS; $40M+ annualized sales; non-GAAP EPS accretive .

S&P Global estimates were unavailable at runtime due to vendor rate limits; as a result, we cannot include quantitative consensus figures or calculate beats/misses this quarter.

SYNAPTICS Inc (SYNA)·Q2 2025 Earnings Summary