10-Q · May 5, 2026
FormFactor reported record Q1 2026 revenue of $226.1 million, exceeding estimates and driven by strong demand in both Probe Cards and DRAM segments. The company achieved an EPS of $0.56, significantly above the…
Earnings analysis · 10-Q
FORM earnings analysis
Filed August 4, 2026 · Our reading of the company's report
The latest report
FormFactor delivered record Q2 revenue of $258.242 million, up 31.9% year over year, with GAAP gross margin expanding 13.4 percentage points to 50.7% and operating margin increasing 16.1 points to 22.4%. Growth was led…
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FormFactor delivered record Q2 revenue of $258.242 million, up 31.9% year over year, with GAAP gross margin expanding 13.4 percentage points to 50.7% and operating margin increasing 16.1 points to 22.4%. Growth was led by DRAM/HBM probe cards, Foundry & Logic demand tied to networking and high-performance compute, and Triton CPO Systems sales. Liquidity improved materially, although Flash demand contracted 48.4%, restructuring and factory start-up costs remain elevated, and working-capital growth consumed $25.9 million of first-half operating cash flow.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $0.71
What stood out
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Record revenue and sharply higher EPS
Q2 revenue was a record $258.242 million, rising $62.444 million, or 31.9%, from $195.798 million a year earlier and approximately $32.2 million from $226 million in Q1 FY2026. GAAP diluted EPS was $0.71, versus $0.12 in Q2 FY2025 and $0.26 in Q1 FY2026.
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Margins expanded materially
Gross margin expanded to 50.7% from 37.3% a year ago and 38.4% in Q1 FY2026, while operating margin rose to 22.4% from 6.3% and 7.4%, respectively. Management attributed improvement to favorable product mix, higher factory utilization, and gross-margin initiatives.
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AI-related DRAM and logic demand accelerated
Probe Cards revenue increased to $209.695 million from $162.108 million. DRAM grew $27.942 million, or 49.0%, to $84.999 million, with HBM representing about 75% of the year-over-year DRAM increase; Foundry & Logic rose $22.326 million, or 22.4%, to $121.839 million.
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Triton drove Systems growth
Systems revenue rose 44.1% to $48.547 million from $33.690 million, driven primarily by sales of the recently introduced Triton high-volume co-packaged-optics testing platform.
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Cash generation strengthened
Free cash flow was $52.6 million in Q2, compared with $30 million in Q1 FY2026 and negative $47 million in Q2 FY2025. For the first six months, operating cash flow increased to $106.764 million from $42.432 million, while PP&E purchases were $24.8 million.
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Liquidity remains substantial
Cash, cash equivalents, and marketable securities increased to $345.6 million at June 27, 2026 from $275.2 million at year-end, and working capital increased to $505.3 million from $433.2 million. The $150 million revolver was fully undrawn, while the building term loan balance was only $11.7 million.
What to watch
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Flash demand declined sharply
Flash revenue declined 48.4% year over year to $2.857 million as customer production activity and demand fell. Management expects Flash to be a smaller share of revenue after the Baldwin Park closure and as other end markets grow.
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Restructuring remains a cost and execution risk
Restructuring charges included in cost of revenue were $4.3 million in Q2 and $25.8 million for the first six months. The Carlsbad factory is expected to manufacture through December 2026, leaving execution risk in the remaining consolidation.
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Texas expansion pressures near-term costs
Factory start-up costs increased to $4.859 million in Q2 from $0.357 million a year ago and are expected to continue through the Farmers Branch build-out. The Texas site is not expected to begin production until late Q4 FY2026, with ramp to initial target levels occurring during FY2027.
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Working-capital investment increased
First-half operating cash flow absorbed a $25.9 million increase in net working capital, including a $30.7 million accounts-receivable increase and a $19.6 million inventory increase. These investments could reverse some cash-flow strength if demand or collections weaken.
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No new risk-factor changes disclosed
Item 1A states there were no material changes to risk factors during the three months ended June 27, 2026. Existing risks still include tariffs, export controls, trade barriers, supply chain constraints, and execution of restructuring and expansion plans.
Management's outlook
The Q3 FY2026 GAAP outlook disclosed with earnings is revenue of $260 million-$280 million and diluted EPS of $0.66-$0.84. In the 10-Q, management also anticipates approximately $7.0 million-$9.0 million of IEEPA tariff refunds in Q3 and expects Farmers Branch production to begin late in Q4 FY2026; no earlier Q3 company outlook was provided for comparison.
Earlier filings 4
10-K · February 20, 2026
FormFactor reported a record $784.99 million of revenue in fiscal 2025, driven by DRAM/HBM demand and strength in South Korea, producing net income of $54.4 million. Gross margin compressed to 39.3% (from 40.3% in 2024)…
10-Q · November 4, 2025
FormFactor reported third-quarter revenue of $202.676 million, roughly flat vs. the prior quarter (+$6.7M vs Q2) and down modestly vs. year-ago Q3 ($207.917M). Gross margin was 39.8% and operating margin 8.9%; diluted…
10-Q · August 5, 2025
FormFactor reported Q2 revenue of $195,798 (thousands) roughly flat with the prior year ($197,474) but up materially vs Q1 2025 ($171,356 derived from six-month totals). Gross margin compressed to 37.3% (gross profit…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.