How did AOSL's revenue and expenses trend in Q2 2025?

Alpha and Omega Semiconductor Ltd (AOSL) experienced a notable year-over-year increase in revenue for Q2 2025, despite a sequential decline. The company's strategic shift towards becoming a total solutions provider and the robust demand in certain segments significantly contributed to the revenue growth.

1. **Revenue Trend**:
- AOSL's total revenue for Q2 2025 was $164.6 million. This represents a 9.7% increase year-over-year, indicating a strong overall performance. However, there was a 4.9% sequential decline, which may be attributed to seasonal factors or specific market fluctuations within the period.
- The Computing segment led the revenue growth, achieving a 14.8% year-over-year increase, primarily driven by the demand for tablets and notebooks. This segment represented 47.9% of the total revenue, highlighting its significance in the company's revenue structure.
- The Power Supply and Industrial Segment also contributed positively, showing a 32.4% year-over-year revenue increase. This segment accounted for 19.9% of the total revenue.
2. **Expense Trends**:
- AOSL reported a Non-GAAP Gross Margin of 22.5% for Q2 2025, which is slightly lower than the previous quarter's 24.2% and the year-ago quarter's 25.2%. This decline may be influenced by changes in product mix and the winding down of licensing revenue.
- The company's Non-GAAP EPS was -$0.10 for the quarter, reflecting a loss. This compares to an EPS of $0.09 in the previous quarter and a loss of $0.04 in the year-ago quarter.
- Operating cash flow was $7.4 million, which included a repayment of $9.6 million in customer deposits. This indicates a healthy cash flow, albeit impacted by such one-time or periodic factors.
3. **Segment Performance**:
- The Computing Segment's revenue growth was driven by robust demand for graphics and AI-accelerated cards, which contributed significantly to the segment's performance.
- The Consumer Segment faced a 9% year-over-year revenue decline and a 4.9% sequential decline, which may be due to market saturation or competitive pressures.
- The Communications Segment showed a 5.8% year-over-year revenue increase but a 14.4% sequential decline, suggesting variability in demand within the segment.

In conclusion, AOSL's revenue for Q2 2025 demonstrated resilience with notable year-over-year growth, although faced some challenges in maintaining sequential revenue and gross margin. The company's focus on strategic segments like Computing and Power Supply, along with innovative product introductions, positions it well for future growth.