Total revenue for the quarter ended December 27, 2025 reached $302.5 million, a 13 % increase from $267.2 million in the same period last year. The jump was largely powered by Core IoT, which grew 53 % to $93.2 million, up from $58.8 million a year earlier. The Core IoT segment, which includes processors, connectivity, and sensing solutions for edge‑AI devices, now accounts for roughly 31 % of total revenue, underscoring the company’s successful pivot from legacy mobile touch to high‑margin IoT products.
The company posted a GAAP net loss of $14.8 million, or $0.38 per basic share, reflecting one‑time acquisition and integration costs that were excluded from the non‑GAAP figures. Non‑GAAP net income reached $48.4 million, or $1.21 per diluted share, beating the consensus estimate of $1.15 by $0.06 (5 %). The earnings beat was driven by disciplined cost control and a favorable product mix that increased the proportion of higher‑margin Core IoT revenue, offsetting the impact of the GAAP loss.
GAAP gross margin slipped to 43.5 % from 45.7 % a year earlier, largely due to higher amortization of acquired intangibles. Non‑GAAP gross margin, however, held steady at 53.6 %, reflecting the company’s ability to maintain pricing power in its high‑margin segments. Operating margin expanded to 19.2 % from 17.2 % a year earlier, a 200‑basis‑point lift that highlights the benefit of scale and the effectiveness of the company’s cost‑control initiatives.
Management guided for fiscal Q3 2026 revenue of $290 million ± $10 million, a 1 % increase from the prior quarter’s $285 million estimate. The guidance level is slightly above the consensus midpoint of $285 million, indicating confidence in continued demand for Core IoT products while acknowledging modest macro‑economic uncertainty. The company reiterated its focus on expanding the Astra edge‑AI platform and maintaining a healthy backlog of orders.
CEO Rahul Patel emphasized that the company’s “strategic pivot to edge‑AI and IoT has positioned us to capture growing demand in robotics, automotive, and industrial markets.” CFO Ken Rizvi highlighted disciplined execution, noting that the company’s “healthy backlog and cost discipline” underpin the positive earnings outcome and support the guidance for the next quarter.
Investors reacted cautiously to the results, with some analysts noting that while the earnings beat was modest, the revenue miss against a higher consensus estimate and the guidance that sits near the lower end of analyst expectations tempered enthusiasm. The market’s focus on the revenue outlook and margin dynamics reflects a broader sensitivity to forward‑looking metrics in the current environment.
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