With ActiveSemi Acquisition, Qorvo Poised to Benefit from Growth Trends in 5G, IoT, and GaN

Qorvo® reported financial results for the company's fiscal 2019 fourth quarter, ended March 30, 2019. On a GAAP basis, revenue for Qorvo's fiscal 2019 fourth quarter was $681 million down 18% compared to the previous quarter

Gross margin was 39.2%. Operating income was $64 million and diluted earnings per share was $0.50.

Bob Bruggeworth, president and chief executive officer of Qorvo, said, "Qorvo executed well in the March quarter, and we are poised to benefit from multiple long-term growth trends, including 5G, IoT, and the proliferation of GaN. On May 6, Qorvo completed the acquisition of Active-Semi International. We're pleased to welcome the Active-Semi team to Qorvo, and we're excited to expand our product offerings and extend our reach into new high-growth power management markets."

Strategic Highlights

• During the quarter the company acquired Active-Semi International, delving into the growing $3B power management market.
• Achieved IDP revenue of $238 million, led by strength in 5G base station deployments, including massive MIMO
• Secured multi-year design win to supply GaAs and GaN components to Lockheed Martin for U.S. Department of Defense ground-based radar program
• Supplied production volumes of highly integrated mid-/high-band PADs to the world's top-six smartphone OEMs and received orders for next-generation 5G-enabled variants
• Introduced industry's first stand-alone ET PMIC capable of modulating the power supply at 100 MHz for 5G New Radio (NR) operation

Mark Murphy, chief financial officer of Qorvo, said, "We ended our fiscal year 2019 strongly with March quarter revenue, gross margin and earnings per share well above our initial expectations. We forecast an even stronger start to fiscal year 2020 and currently project growth in revenue, earnings and free cash flow for full-year fiscal 2020."

Non-GAAP Forecast for Q1 of Fiscal 2020

Qorvo currently believes the demand environment in its end markets supports the following non-GAAP expectations for the June 2019 quarter:

The company targets quarterly revenue in the range of $780 million to $800 million and aims to achieve a gross margin between 45% and 45.5%. The company also forecasts diluted earnings per share of $1.30 at the midpoint of guidance.