Executive Summary

Q3 FY2025 revenue was $266.6M and non-GAAP EPS $0.90; both slightly exceeded S&P Global consensus, driven by 43% YoY Core IoT growth and stable non-GAAP gross margin at 53.5% . On GAAP, gross margin was 43.4% and GAAP EPS was a loss of $0.56, reflecting acquisition/integration, stock-based comp, and an intangible impairment .
Mix: Core IoT 25%, Enterprise & Automotive 58%, Mobile 17%. Enterprise & Automotive was down 3% q/q on auto softness; Core IoT rose 11% q/q; Mobile fell 4% q/q as a large program reached EoL .
Q4 guide: Revenue $280M ± $15M, non-GAAP GM 53.5% ±1%, non-GAAP OpEx $103M ±$2M, non-GAAP EPS $1.00 ± $0.20; management sees sequential and YoY growth and minimal direct tariff impact but continues to monitor end-demand risk .
Capital allocation/cash: $74.0M cash from operations, $37.9M buybacks (~546k shares), ending cash and ST investments ~$421.4M; Broadcom asset transaction spend of $198M completed during the quarter .

What Went Well and What Went Wrong

What Went Well
- Core IoT strength: “Core IoT product sales increased 43% year-over-year to $68 million,” with 11% q/q growth, driven by wireless and processor momentum and lean channel inventories .
- Product pipeline/AI: Launched Wi‑Fi 7 IoT SoCs and ultra‑low‑power triple‑combo connectivity; management highlighted Astra SR-series AI-native MCUs and growing partner ecosystem traction .
- Cost/margin delivery: Non‑GAAP GM held at 53.5%, non‑GAAP operating margin 15.6%; Q4 guide maintains non‑GAAP GM midpoint at 53.5% .
What Went Wrong
- Auto headwinds: Enterprise & Automotive down 3% q/q “mainly due to continued softness in Automotive,” a challenge management expects to persist near-term .
- Sequential operating margin: Non‑GAAP operating margin fell ~170 bps q/q (to 15.6%) due to Broadcom transaction-related OpEx and variable costs .
- GAAP loss: GAAP EPS −$0.56, impacted by acquisition/integration costs, share-based comp, and a $13.8M intangible impairment; highlights reliance on non‑GAAP to reflect core performance .

Financial Results

Metric	Q1 2025	Q2 2025	Q3 2025
Revenue ($M)	$257.7	$267.2	$266.6
GAAP Gross Margin %	46.9%	45.7%	43.4%
Non-GAAP Gross Margin %	53.9%	53.6%	53.5%
GAAP EPS ($)	$(0.58)	$0.05	$(0.56)
Non-GAAP EPS ($)	$0.81	$0.92	$0.90

Segment mix and growth

Metric	Q2 2025	Q3 2025
Core IoT mix	23%	25%
Enterprise & Automotive mix	59%	58%
Mobile mix	18%	17%
Core IoT growth	+63% YoY, +3% q/q	+43% YoY, +11% q/q
E&A growth	+17% YoY, −8% q/q	+14% YoY, −3% q/q
Mobile growth	−25% YoY, −7% q/q	−18% YoY, −4% q/q

Operating/cash KPIs

KPI	Q2 2025	Q3 2025
Non-GAAP OpEx ($M)	$97.1	$101
Non-GAAP Op Margin %	17.3%	15.6%
Cash + ST investments ($M)	$596.1 cash; total cash disclosed at $596.1 ; see CFO commentary	~$421.4 cash, cash equivalents and ST investments
CFO ($M)	$24	$74.0
Share repurchases	~1.0M shares; $74.5M	~546k shares; $37.9M
DSO (days)	49	45
Inventory ($M)	$119.5	$132.9
DOI (days)	87	96

Non-GAAP reconciliation (selected Q3 items)

Add-backs included: acquisition/integration $32.8M; share-based comp $19.9M; intangible impairment $13.8M; restructuring $0.5M; Non-GAAP tax adjustments −$11.4M; resulting in non-GAAP net income $35.3M and $0.90 diluted EPS .

Guidance Changes

Metric	Period	Previous Guidance (from Q2 release – Q3 FY25)	Current Guidance (from Q3 release – Q4 FY25)	Change
Revenue	Next quarter	$265M ± $15M	$280M ± $15M	Raised sequentially
Non-GAAP Gross Margin %	Next quarter	53.5% ± 1%	53.5% ± 1%	Maintained
Non-GAAP OpEx ($M)	Next quarter	$101 ± $2	$103 ± $2	Slightly higher
Non-GAAP EPS ($)	Next quarter	$0.85 ± $0.20	$1.00 ± $0.20	Raised
Non-GAAP net interest & other ($M)	Next quarter	~1	~1	Maintained
Non-GAAP tax rate	Next quarter	13–15%	13–15%	Maintained

Notes: GAAP guidance includes acquisition/integration and SBC impacts; non-GAAP excludes those per detailed footnotes .

Earnings Call Themes & Trends

Topic	Q1 FY2025 (Nov call)	Q2 FY2025 (Feb call)	Q3 FY2025 (May call)	Trend
Core IoT momentum	+55% YoY; inventories normalizing	+63% YoY; Broadcom assets to add ~$10M/quarter run-rate in Core IoT	+43% YoY; +11% q/q; sixth straight q/q growth expected in Q4	Sustained acceleration
Edge AI/Astra	Building Astra ecosystem; Google collaboration announced in Jan	Google partnership to integrate MLIR core; Astra funnel growing	Launched Astra SR-series MCUs; ODMs/OEMs engagements rising	Broadening adoption
Wireless/Wi‑Fi 7	Sampling Wi‑Fi 7	Broadcom deal extends Wi‑Fi 7/8, GNSS, UWB IP	First Wi‑Fi 7 IoT launches; “first to introduce Wi‑Fi 7 to IoT”	Product leadership
PCs/AI PCs/UPD	—	Share gains; UPD win expanded to another OEM	Better than seasonal PCs; UPD “swept most SKUs” at one OEM; Nvidia AI PC wins	Share/content gains
Automotive	—	Cautious; U.S./Europe exposure; SmartBridge design win	Continued sluggish demand	Persistent headwind
Tariffs/macro	—	—	Minimal direct impact so far; watching end-demand risk	Risk monitored
Mobile	Focus on high-end Android	EoL headwind behind; China Android recovering	Multi-frequency touch for foldables; first launch expected in calendar Q3	Refocus on premium Android

Management Commentary

“We delivered another strong quarter in March, with revenues increasing 12% year-over-year to $267 million… non-GAAP EPS grew 70% year-over-year to $0.90” .
“Core IoT product sales increased 43% year-over-year to $68 million” .
“We have launched our first Wi‑Fi 7 device for IoT applications” with 2x throughput and lower latency for high-bandwidth use cases .
“PC products performed slightly better than typical seasonality… we have expanded our engagement through design wins for next‑generation AI PCs built on Nvidia platforms” .
“In Automotive, we continue to navigate near-term challenges in sluggish demand” .
“June quarter revenues [Q4]… approximately $280 million at the midpoint” with non‑GAAP GM 53.5% and non‑GAAP EPS ~$1.00 .

Q&A Highlights

Core IoT drivers: Wireless momentum and Broadcom asset contribution (~$10M/quarter run-rate framework), while Wi‑Fi 7 ramps later (tail end of CY25/into 2026) .
UPD/HPD competitive positioning: Lower-cost, lower-power ASIC vs FPGA solutions; confidence against software-only alternatives; “swept most SKUs… at one large OEM” and penetrating another .
Tariffs: No material direct impact observed; backlog/bookings healthy into September; key uncertainty is potential end-demand effects .
Wireless leadership: “We are the first one to introduce Wi‑Fi 7 to IoT market” and leveraging advanced process nodes for low power .
Broadcom transaction: Expands SAM (AR/VR, Android smartphones, consumer audio); embedded in Core IoT; multi‑year design-win opportunity .

Estimates Context

Results vs S&P Global consensus

Metric	Q1 2025	Q2 2025	Q3 2025
Revenue Consensus Mean ($M)	255.24*	265.59*	265.03*
Revenue Actual ($M)	257.7	267.2	266.6
Primary EPS Consensus Mean ($)	0.7488*	0.86*	0.8587*
Non-GAAP EPS Actual ($)	0.81	0.92	0.90

Q3 FY2025 slightly beat revenue and non‑GAAP EPS consensus; margin performance aligned with non‑GAAP guidance (53.5%), aided by Core IoT strength and disciplined OpEx, offset by auto softness and modest sequential OpEx increase from the Broadcom transaction .
Values with an asterisk (*) are from S&P Global and provided via the GetEstimates tool. Values retrieved from S&P Global.

Key Takeaways for Investors

Core IoT remains the growth engine (up 43% YoY in Q3), and management guides to further sequential and YoY growth in Q4, signaling continuing demand improvement and Broadcom asset contribution .
Non‑GAAP margin durability: GM held ~53.5% and is guided to remain at that level in Q4, supporting earnings leverage as volumes improve .
Watch autos: Enterprise & Automotive was down 3% q/q on ongoing auto demand softness; a recovery here would be a notable incremental tailwind .
Product catalysts: First Wi‑Fi 7 IoT SoCs launched; Astra SR‑series MCUs and partnerships (e.g., Google) deepen Edge AI positioning—potential to accelerate in CY26–27 .
PC share/content gains: Better-than-seasonal PCs; UPD wins across major OEMs and Nvidia AI PC engagement underpin enterprise franchise resilience .
Near-term setup: Q4 guide implies sequential revenue/EPS uplift; limited direct tariff impact so far, but monitor macro/tariff-driven end-demand risks .
Capital returns and liquidity: Strong OCF ($74M), ongoing buybacks, and ample liquidity position SYNA to invest and repurchase shares during product cycle ramps .

Appendices

Other relevant Q3 FY2025-period press releases

Wi‑Fi 7 for IoT (SYN4390/SYN4384) launch (Apr 28, 2025): Triple-combo Wi‑Fi 7/Bluetooth 6.0/Zigbee/Thread SoCs for high‑bandwidth, low‑latency IoT .
Ultra‑low‑power triple‑combo (SYN461x) for embedded Edge AI IoT (Mar 10, 2025) .
Embedded World 2025 presence including SmartBridge automotive display tech (Mar 5, 2025) .

GAAP vs Non‑GAAP adjustments (Q3 FY2025)

Key items excluded: acquisition/integration ($32.8M), share‑based compensation ($19.9M), intangible impairment ($13.8M), restructuring ($0.5M), other non‑cash and non‑GAAP tax adjustments, leading to non‑GAAP net income $35.3M and $0.90 EPS .

SYNAPTICS Inc (SYNA)·Q3 2025 Earnings Summary