Qorvo Inc (NASDAQ:QRVO), a leading provider of innovative RF solutions that connect the world, today announced financial results for the Company’s fiscal 2017 first quarter, ended July 2, 2016. On a GAAP basis, June quarterly revenue increased 4% year-over-year and 15% sequentially to $698.5 million. Gross margin was 39.6%, operating expenses were $270.7 million, operating income was $5.7 million, and net loss was $5.7 million, or a loss of $0.04 per share based on 127.5 million weighted average shares outstanding. Gross margin decreased sequentially on both a GAAP and non-GAAP basis, primarily due to a mix shift to lower margin products. Operating expenses increased sequentially on both a GAAP and non-GAAP basis, primarily due to higher R&D expenses, increased variable compensation expense, and the addition of GreenPeak Technologies. The higher R&D expense reflects increased investment in high-performance filter designers, SAW and BAW process engineers, and associated material costs for prototypes.

On a non-GAAP basis, gross margin was 48.2%, operating expenses were $168.6 million, operating income was $167.6 million, or 24.0% of sales, and net income was $143.1 million, or $1.08 per diluted share based on 132.6 million weighted average shares outstanding.

Bob Bruggeworth, president and chief executive officer of Qorvo, said, “Qorvo today is the number-one or number-two player in the majority of our growth markets, and we are investing to extend our leadership. We are building a technology moat to maintain leadership where we are number one, and where we are number two, we are investing to advance from a challenger to the leader.

“In the June quarter, Qorvo saw customer order activity accelerate as the quarter progressed, and the entire Qorvo Team ran hard to satisfy demand. In the September quarter, we continue to see strong demand in support of this year’s most popular devices, and we’re rapidly expanding our capabilities to develop new highly integrated solutions for large customer opportunities launching in 2017 and 2018.”

Financial Outlook

Qorvo currently believes the demand environment in its end markets supports the following non-GAAP expectations for theSeptember 2016 quarter:

  • Quarterly revenue in the range of $820 million to $850 million
  • Gross margin of approximately 47%
  • A tax rate of approximately 10%
  • Diluted EPS of approximately $1.35 to $1.45 (Original Source)

Shares of Qorvo are down over 4% to $58.53 in after-hours trading. QRVO has a 1-year high of $64.80 and a 1-year low of $33.30. The stock’s 50-day moving average is $57.25 and its 200-day moving average is $48.84.

On the ratings front, Qorvo has been the subject of a number of recent research reports. In a report issued on July 22, Cowen analyst Timothy Arcuri reiterated a Buy rating on QRVO, with a price target of $65, which represents a slight upside potential from current levels. Separately, on July 19, BMO’s Ambrish Srivastava reiterated a Buy rating on the stock .

According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Timothy Arcuri and Ambrish Srivastava have a total average return of 9.9% and 8.4% respectively. Arcuri has a success rate of 61.4% and is ranked #217 out of 4083 analysts, while Srivastava has a success rate of 68.9% and is ranked #634.

Overall, one research analyst has rated the stock with a Sell rating, 6 research analysts have assigned a Hold rating and 7 research analysts have given a Buy rating to the stock. When considering if perhaps the stock is under or overvalued, the average price target is $59.71 which is -5.7% under where the stock opened today.

Qorvo, Inc. engages in the provision of core technologies and radio frequency solutions for mobile, infrastructure, and aerospace or defense applications. Its products include amplifiers, control products, discrete transistors and integrated circuits, filters and duplexers, frequency converters, integrated modules, optical components, oscillators, passives and switches.