FormFactor, Inc. reported record quarterly revenue of $215.2 million for fiscal 2025 Q4, a 6.2 % increase from $202.7 million in Q3. Non‑GAAP gross margin rose to 43.9 %, up 2.9 percentage points from 41.0 % in the prior quarter. Non‑GAAP earnings per share reached $0.46, beating the consensus estimate of $0.35 by $0.11, a 31 % surprise, while GAAP EPS of $0.29 was also higher than the $0.20 reported in Q3.
Full‑year non‑GAAP gross margin for fiscal 2025 settled at 40.8 %, down from 41.7 % in 2024, reflecting a 200‑basis‑point headwind from tariffs. The company guided for Q1 2026 revenue of $225 million ±$5 million and non‑GAAP EPS of $0.45 ±$0.04, maintaining its confidence in continued demand for high‑bandwidth memory and advanced packaging.
Revenue growth was driven by a 13.6 % year‑over‑year increase in the probe‑card segment, fueled by strong demand from data‑center customers building AI infrastructure. Margin expansion was largely the result of cost‑control initiatives that improved cycle time and yield, and a workforce reduction program that cut operating expenses. The company also noted a 200‑basis‑point tariff impact that weighed on gross margin, but the mix shift to higher‑margin HBM and packaging contracts helped offset the headwind.
In addition to the earnings announcement, FormFactor completed the acquisition of Keystone Photonics for $20 million in cash, adding co‑packaged optics testing capabilities that complement its existing test‑and‑measure portfolio. The firm is also investing in a new facility in Farmers Branch, Texas, expected to come online later in 2026 and ramp in 2027, which will provide lower‑cost capacity to support future margin expansion.
CEO Mike Slessor said the quarter represented “record revenue on both a quarterly and annual basis” and that the company would continue to deliver sequentially higher revenue and gross margin in Q1 2026. CFO Aric McKinnis highlighted that two‑thirds of the gross‑margin improvement since Q2 2025 was driven by cost‑side initiatives, and that the company expects an additional 110 basis points of margin expansion at the midpoint of its Q1 guidance. Investors reacted cautiously, with market sentiment tempered by valuation concerns despite the strong earnings beat.
Overall, FormFactor’s Q4 results demonstrate robust execution in high‑growth AI and data‑center markets, disciplined cost management, and a clear path to margin expansion, while the company remains mindful of tariff headwinds and the need to scale its new optics and facility investments.
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