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Qorvo (QRVO) Beats on Q4 Earnings, Issues Q1 Guidance

Qorvo, Inc.QRVO reported fourth-quarter fiscal 2016 net loss of $24.2 million or a loss of 18 cents per share. In the year-ago quarter, the company had generated net income of $6.5 million or 4 cents per share. The striking deterioration was primarily due to lower revenues during the quarter.

Non-GAAP earnings in the reported quarter were $142.6 million or $1.04 per share, down from $167.2 million or $1.11 per share in the year-ago quarter. Adjusted earnings (with stock-based compensation adjustments) of 85 cents per share beat the Zacks Consensus Estimate of 69 cents.

For full fiscal 2016, reported net loss was $28.8 million or a loss of 20 cents per share, while reported net income was $196.3 million or $2.11 per share in fiscal 2015. The significant decline in fiscal earnings was primarily attributable to higher operating expenses.

Revenues

Non-GAAP revenues for fourth-quarter fiscal 2016 declined to $607.1 million from $633.9 million in the year-ago quarter. Revenues beat the Zacks Consensus Estimate of $604 million.

Fiscal fourth-quarter GAAP revenues decreased to $608.1 million from $634.9 million in the year-ago period. For fiscal 2016, revenues significantly grew to $2,610.7 million from $1,711 million in the prior year on increased demand for the company's highly integrated solutions and growth in its Infrastructure and Defense Products (IDP) segment markets.

Margins

Fiscal fourth-quarter non-GAAP gross margin was 50% versus 50.4% in the year-ago quarter. Non-GAAP income from operations was $160.6 million versus $169.6 million in the prior-year quarter.

GAAP gross margin came in at 41.8% versus 29.8% in the year-ago quarter. GAAP operating income was $8.5 million, while the prior-year quarter had seen operating loss of $102.5 million. Total cost and expenses were $599.6 million versus $737.4 million in the year-ago quarter.

Balance Sheet & Cash Flow

For fiscal 2016, cash and cash equivalents were $425.9 million compared to $299.8 million in the prior year period. Long-term debts were $988.1 million as on April 2, 2016. During the fiscal fourth quarter, the company repurchased approximately 10 million shares.

Net cash provided by operating activities came in at $160.5 million with free cash flow of $76.1 million at the end of the quarter.

Outlook

Qorvo expects non-GAAP revenues in first-quarter fiscal 2017 to be approximately $650 million. The company expects gross margin of approximately 50% and earnings per share of approximately $1.05. Qorvo also projects net interest expense of approximately $15 million for the fiscal first quarter.

Qorvo carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the same space include Parkervision Inc. PRKR , Towerstream Corporation TWER and Himax Technologies, Inc. HIMX . Each of these stocks carries a Zacks Rank #2 (Buy).

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PARKERVISION (PRKR): Free Stock Analysis Report

TOWERSTREAM CP (TWER): Free Stock Analysis Report

QORVO INC (QRVO): Free Stock Analysis Report

HIMAX TECH-ADR (HIMX): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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