Executive Summary
Cirrus Logic Inc (CRUS) reported strong financial results for Q3 2025, with revenue reaching $555.7 million, significantly exceeding management's previous guidance. This performance was driven largely by robust demand for smartphone audio products and innovative mixed-signal solutions. Despite a year-over-year decline of 10%, the quarter showed a sequential revenue increase of 3%, reflecting higher smartphone unit volumes. The company’s gross profit margin improved to 53.6%, attributed to a favorable product mix and reduced supply chain costs. Management remains optimistic about ongoing growth, leveraging its core competencies in audio technology while expanding into new markets like laptops and automotive applications, positioning itself for sustainable future revenue.
Key Performance Indicators
QoQ: 10.56% | YoY:178.31%
QoQ: 13.57% | YoY:158.70%
QoQ: 14.06% | YoY:163.86%
Key Insights
Revenue: $555.7M (YoY: -10%, QoQ: +3%)
Gross Profit: $297.8M (Gross Margin: 53.6%, YoY: +5.4%, QoQ: +1.4%)
Operating Income: $145.8M (Operating Margin: 26.2%, YoY: +178.3%, QoQ: +10.6%)
Net Income: $116.0M (Net Margin: 20.9%, YoY: +158.7%, QoQ: +13.6%)
EPS: $2.19 (Diluted EPS: $2.11)
Cash Flow from Operations: $218.6M
Free Cash Flow: $212.1M
Cash and Equivalents: $526.4M
Current Ratio: 5.93, Quick Ratio: 4.62, Debt to Equity Ratio: 0.075...
Financial Highlights
Revenue: $555.7M (YoY: -10%, QoQ: +3%)
Gross Profit: $297.8M (Gross Margin: 53.6%, YoY: +5.4%, QoQ: +1.4%)
Operating Income: $145.8M (Operating Margin: 26.2%, YoY: +178.3%, QoQ: +10.6%)
Net Income: $116.0M (Net Margin: 20.9%, YoY: +158.7%, QoQ: +13.6%)
EPS: $2.19 (Diluted EPS: $2.11)
Cash Flow from Operations: $218.6M
Free Cash Flow: $212.1M
Cash and Equivalents: $526.4M
Current Ratio: 5.93, Quick Ratio: 4.62, Debt to Equity Ratio: 0.075
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
555.74M |
49.46% |
2.56% |
| Gross Profit |
297.79M |
53.03% |
5.38% |
| Operating Income |
145.77M |
178.31% |
10.56% |
| Net Income |
116.01M |
158.70% |
13.57% |
| EPS |
2.19 |
163.86% |
14.06% |
Key Financial Ratios
operatingProfitMargin
26.2%
operatingCashFlowPerShare
$4.12
Management Commentary
1. Revenue Performance:
- "In the December quarter, Cirrus Logic delivered revenue of $555.7 million, above the top end of our guidance range due to stronger than expected demand for products..." - John Forsyth, CEO
2. Growth Strategy:
- "Our long-term strategy is based around three principles: maintaining leadership in our core smartphone audio business, expanding high-performance mixed-signal functionality, and leveraging expertise into new markets."
3. Product Development:
- "We are excited about our next-generation PC amplifier and codec, which we anticipate will broaden our portfolio further and address a wider range of the laptop market..." - John Forsyth, CEO.
"We anticipate that these components will be used in multiple generations of smartphones over a number of years, giving us excellent longer-term visibility."
— John Forsyth
"When we look further out, really, HPMS actually represents the larger part of the SAM that we see ahead of us."
— John Forsyth
Forward Guidance
For Q4 FY 2025, management projects revenue to range between $350 million to $410 million, with anticipated GAAP gross margins between 51% to 53%. This guidance reflects seasonal trends and management’s strategy of managing inventory levels to meet demand. With recent product introductions in both smartphone and laptop markets, Cirrus Logic expects to maintain momentum despite the anticipated fluctuations in smartphone unit sales, aiming to offset this with diverse revenue streams from new market segments.