Semtech Reports 20% Sales Gain in Q2

(NASDAQ:SMTC), a supplier of analog and mixed-signal semiconductors for the Internet of Things (IoT), data center, and infrastructure sectors, reported results for Q2 fiscal 2026 on August 25, 2025. The company’s report showed a sharp rise in net sales and notable gains in adjusted (non-GAAP) profitability, beating both its own guidance and prior-year figures (non-GAAP). Net sales (GAAP) came in at $257.6 million, barely surpassing the company’s midpoint guidance of $256.0 million. Adjusted diluted earnings per share (EPS) reached $0.41, well above the $0.11 reported a year ago. However, despite these gains on an adjusted basis, the quarter included a substantial $42.0 million goodwill impairment (GAAP), which drove a GAAP net loss of $(27.1) million. Overall, the period reflected improved sales momentum and margin expansion, but also underscored the continuing gap between adjusted (non-GAAP) and GAAP results.

Semtech’s core business centers on designing and marketing analog and mixed-signal semiconductors, which are critical components enabling high-speed data transfer, signal integrity, and power management in modern electronics. Its technology powers infrastructure, industrial, consumer, and especially IoT applications, where demand for connectivity, sensing, and integrated modules continues to expand. The company holds a strong position in the market for IoT modules, gateways, and advanced connectivity solutions, targeting sectors like smart metering, asset tracking, and industrial automation.

In recent years, the company has sharpened its focus on high-growth verticals, most notably the IoT and infrastructure segments. A key part of its strategy has been integrating Sierra Wireless, a provider of wireless communication modules and services, to extend Semtech’s reach in end-to-end IoT solutions. Achieving synergy from acquisitions and maintaining innovation in analog and mixed-signal design remain top priorities, as does managing supply chain flexibility through extensive outsourcing to third-party manufacturers.

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Source Fool.com