Formfactor Stock Earnings Reports

FormFactor reported strong sequential growth and operational progress in Q1 2026: revenue of $226.1M (above midpoint), non-GAAP gross margin of 49%, and non-GAAP EPS of $0.56. Management says the company has hit its target model on a run-rate basis (47% non-GAAP gross margin at an $850M annual revenue run rate) and is seeing durable margin improvement driven by operational efficiencies, yield and cycle-time gains, and discrete cost actions. Guidance for Q2 is revenue of $240M ± $5M, non-GAAP gross margin ~49.5% ±150 bps and non-GAAP EPS $0.61 ± $0.04. Key growth drivers: continued HBM demand (Smart Matrix full-wafer contactor adoption), accelerating foundry/logic demand (networking and data-center CPU probes tied to AI inference), ramping traction in co-packaged optics (CPO) with the Triton system and the Keystone Photonics acquisition integration. The Farmers Branch expansion is expected to begin coming online late 2026 and ramp through 2027 to materially increase capacity (roughly ~60% of current probe-card capacity equivalent) and drive future gross-margin expansion. Tariffs remain a headwind but recent changes reduced rates and the company may be eligible for $9–11M of refunds depending on legal outcomes. Cash and investments totaled ~$303M; 2026 cash CapEx for Farmers Branch is expected to be $140–170M. Management will present a new long-term target model and strategy at Investor Day on May 11. Risks: ongoing capacity constraints, product mix seasonality, tariff uncertainty and the usual forward-looking risks noted in SEC filings.