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FORM Q1 Earnings Beat Estimates, Revenues Rise Y/Y, Margin Jumps
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Key Takeaways
FormFactor reported Q1 EPS of 56 cents, up 143.5% y/y, beating estimates by 24.4%.
FORM revenues rose 32% y/y to $226.1M, driven by record DRAM and probe card demand.
FORM's gross margin jumped to 49%, with the Q2 guidance signaling continued DRAM-led momentum.
FormFactor (FORM - Free Report) delivered first-quarter fiscal 2026 non-GAAP earnings of 56 cents per share, which increased 143.5% year over year and beat the Zacks Consensus Estimate by 24.4%.
Revenues were $226.1 million, up 32% year over year, and beat the consensus mark by 0.23%. Results reflected a strong demand backdrop, highlighted by record DRAM revenues (36.7% of the total revenues) of $82.9 million, up 69.5% year over year, supported by higher HBM-related activity and sustained non-HBM demand.
FORM’s Segmental Revenues Details
FORM’s top line continued to be driven by Probe Cards, which generated $198.2 million in the quarter, up 45% year over year. The strength underscored broad-based demand across memory and logic test applications, keeping the company’s core consumables franchise in a favorable position as customers push for higher test intensity.
Within Probe Cards, Foundry & Logic revenues (49.2% of the total revenues) rose to $111.2 million, up 30.4% year over year, reflecting growth in probe cards tied to networking applications. Flash revenues (1.8% of the total revenues) were $4.1 million, up 70.8% year over year, while the overall probe card mix continued to benefit from advanced packaging-related testing requirements. Systems revenues (12.3% of the total revenues) were $27.9 million, down 19.8% year over year.
FormFactor, Inc. Price, Consensus and EPS Surprise
FormFactor’s revenue mix remained heavily weighted toward Asia, led by South Korea at $80.6 million (35.6% of total revenues) and Taiwan at $70.8 million (31.3% of total revenues). The United States generated $29.4 million (13% of total revenues), while China contributed $11.4 million (5% of total revenues), highlighting a geographic profile closely aligned with leading-edge semiconductor production and memory manufacturing hubs.
Customer concentration also stood out. SK Hynix accounted for 29.5% of total revenues in the quarter, and NVIDIA represented 10.2%. The concentration reflects FORM’s exposure to large, high-volume customers that are actively investing in advanced memory and compute platforms.
FORM’s Operating Results
FORM’s non-GAAP gross margin climbed to 49%, improving 980 basis points (bps) year over year and 510 bps sequentially. The outperformance supported management’s view that the quarter exceeded the company’s target model on a quarterly run-rate basis, helped by a favorable demand environment and improved profitability.
FormFactor continued to invest in product development while maintaining discipline in its operating cost structure. Non-GAAP research and development expense was $27 million, down 2.8% year over year, while selling, general and administrative expense totaled $27.9 million, down 16.5% year over year.
Total non-GAAP operating expenses were $62 million, up 23.4% year over year, while non-GAAP operating income was $48.7 million, up 188.3% year over year, reflecting the company’s stronger underlying operating performance after adjustments.
FormFactor’s Balance Sheet & Cash Flow
As of March 28, 2026, cash and cash equivalents and marketable securities were $303.2 million compared with $275.1 million as of Dec. 27, 2025.
Cash generated from operating activities was $45 million in the reported quarter, slightly down from $46 million in the previous quarter. Free cash flow was $30.7 million.
FORM Offers Optimistic Q2 Guidance
FormFactor’s outlook called for continued momentum into the second quarter of fiscal 2026. The company guided revenues to $240 million (plus or minus $5 million), with non-GAAP gross margin expected at 49.5% (plus or minus 1.5%), and non-GAAP earnings projected at 61 cents (plus or minus 4 cents) per share.
Management noted that the outlook reflects strong DRAM demand driven by HBM, alongside continued growth in Foundry & Logic probe-card revenues, supported by incremental strength in data-center CPU applications. The outlook assumes consistent foreign currency rates, setting a constructive tone for sequential progress.
FORM’s Zacks Rank & Stocks to Consider
FormFactor currently carries a Zacks Rank #3 (Hold).
View the Zacks #1 Rank List
Image: Bigstock
FORM Q1 Earnings Beat Estimates, Revenues Rise Y/Y, Margin Jumps
Key Takeaways
FormFactor (FORM - Free Report) delivered first-quarter fiscal 2026 non-GAAP earnings of 56 cents per share, which increased 143.5% year over year and beat the Zacks Consensus Estimate by 24.4%.
Revenues were $226.1 million, up 32% year over year, and beat the consensus mark by 0.23%. Results reflected a strong demand backdrop, highlighted by record DRAM revenues (36.7% of the total revenues) of $82.9 million, up 69.5% year over year, supported by higher HBM-related activity and sustained non-HBM demand.
FORM’s Segmental Revenues Details
FORM’s top line continued to be driven by Probe Cards, which generated $198.2 million in the quarter, up 45% year over year. The strength underscored broad-based demand across memory and logic test applications, keeping the company’s core consumables franchise in a favorable position as customers push for higher test intensity.
Within Probe Cards, Foundry & Logic revenues (49.2% of the total revenues) rose to $111.2 million, up 30.4% year over year, reflecting growth in probe cards tied to networking applications. Flash revenues (1.8% of the total revenues) were $4.1 million, up 70.8% year over year, while the overall probe card mix continued to benefit from advanced packaging-related testing requirements. Systems revenues (12.3% of the total revenues) were $27.9 million, down 19.8% year over year.
FormFactor, Inc. Price, Consensus and EPS Surprise
FormFactor, Inc. price-consensus-eps-surprise-chart | FormFactor, Inc. Quote
FormFactor’s revenue mix remained heavily weighted toward Asia, led by South Korea at $80.6 million (35.6% of total revenues) and Taiwan at $70.8 million (31.3% of total revenues). The United States generated $29.4 million (13% of total revenues), while China contributed $11.4 million (5% of total revenues), highlighting a geographic profile closely aligned with leading-edge semiconductor production and memory manufacturing hubs.
Customer concentration also stood out. SK Hynix accounted for 29.5% of total revenues in the quarter, and NVIDIA represented 10.2%. The concentration reflects FORM’s exposure to large, high-volume customers that are actively investing in advanced memory and compute platforms.
FORM’s Operating Results
FORM’s non-GAAP gross margin climbed to 49%, improving 980 basis points (bps) year over year and 510 bps sequentially. The outperformance supported management’s view that the quarter exceeded the company’s target model on a quarterly run-rate basis, helped by a favorable demand environment and improved profitability.
FormFactor continued to invest in product development while maintaining discipline in its operating cost structure. Non-GAAP research and development expense was $27 million, down 2.8% year over year, while selling, general and administrative expense totaled $27.9 million, down 16.5% year over year.
Total non-GAAP operating expenses were $62 million, up 23.4% year over year, while non-GAAP operating income was $48.7 million, up 188.3% year over year, reflecting the company’s stronger underlying operating performance after adjustments.
FormFactor’s Balance Sheet & Cash Flow
As of March 28, 2026, cash and cash equivalents and marketable securities were $303.2 million compared with $275.1 million as of Dec. 27, 2025.
Cash generated from operating activities was $45 million in the reported quarter, slightly down from $46 million in the previous quarter. Free cash flow was $30.7 million.
FORM Offers Optimistic Q2 Guidance
FormFactor’s outlook called for continued momentum into the second quarter of fiscal 2026. The company guided revenues to $240 million (plus or minus $5 million), with non-GAAP gross margin expected at 49.5% (plus or minus 1.5%), and non-GAAP earnings projected at 61 cents (plus or minus 4 cents) per share.
Management noted that the outlook reflects strong DRAM demand driven by HBM, alongside continued growth in Foundry & Logic probe-card revenues, supported by incremental strength in data-center CPU applications. The outlook assumes consistent foreign currency rates, setting a constructive tone for sequential progress.
FORM’s Zacks Rank & Stocks to Consider
FormFactor currently carries a Zacks Rank #3 (Hold).
Audioeye (AEYE - Free Report) , Advanced Energy Industries (AEIS - Free Report) and MKS (MKSI - Free Report) are some better-ranked stocks that investors can consider in the broader Zacks Computer & Technology sector. These three companies presently sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Shares of Audioeye have lost 27.4% in the year-to-date period. AEYE is set to report its first-quarter 2026 results on May 13.
Shares of Advanced Energy Industries have gained 72.6% in the year-to-date period. AEIS is likely to report its first-quarter 2026 results on May 4.
Shares of MKS have gained 66.1% in the year-to-date period. MKSI is likely to report its first-quarter 2026 results on May 6.