Cirrus Logic 2025 Q4 Earnings Beats Expectations as Net Income Soars 58.9%

Cirrus Logic (CRUS) reported its fiscal 2025 Q4 earnings on May 06th, 2025. The company exceeded analysts' expectations, posting a net income of $71.27 million, significantly higher than the prior year's $44.84 million. Cirrus Logic's guidance for Q1 fiscal 2026 projects revenue between $330 million and $390 million, slightly below previous forecasts, reflecting a 15% sequential decline. While gross margins are expected to range from 51% to 53%, non-GAAP operating expenses are anticipated to be influenced by employee-related costs, estimated between $119 million and $125 million.

Revenue
Cirrus Logic saw a remarkable increase in total revenue for Q4 2025, amounting to $424.46 million, marking a 14.2% rise from the previous year. The audio segment was the primary revenue driver, generating $255.33 million. Meanwhile, the high-performance mixed-signal segment contributed $169.13 million, supporting the overall growth.

Earnings/Net Income
Cirrus Logic's earnings per share (EPS) showcased robust growth, rising 62.7% to $1.35 in Q4 2025 from $0.83 in the same quarter of the previous year. This increase underscores the company's continued earnings momentum and improved profitability. The EPS performance reflects positively on the company's financial health.

Price Action
The stock price of Cirrus Logic edged up 1.51% during the latest trading day, climbed 5.53% during the most recent full trading week, and jumped 11.11% month-to-date.

Post-Earnings Price Action Review
The investment strategy of purchasing Cirrus Logic (CRUS) shares following a quarter of revenue growth and holding them for 30 days has proven ineffective over the past five years. This approach yielded an overall return of -8.18%, significantly underperforming the benchmark return of 83.12%. The excess return stood at -91.30%, with a compound annual growth rate (CAGR) of -1.71%. Additionally, the strategy experienced a maximum drawdown of -14.90% and a Sharpe ratio of -0.20, coupled with a volatility of 8.65%. These figures indicate that the strategy posed substantial risk and failed to produce positive returns, deeming it an unviable investment method. Investors seeking to capitalize on Cirrus Logic's earnings growth should consider alternative strategies that align more closely with market conditions and historical performance benchmarks.

CEO Commentary
John Forsyth, CEO of Cirrus Logic, highlighted the company’s strong performance in Q4 2025, reporting revenue of $424.5 million, driven by new product launches and increased smartphone volumes. He expressed pride in achieving record GAAP and non-GAAP earnings per share, alongside returning $261 million to shareholders. Forsyth addressed the dynamic macroeconomic environment and potential tariff impacts, emphasizing ongoing investments in geographic supply chain diversification. He underscored Cirrus Logic’s long-term growth strategy, focusing on leadership in smartphone audio, expanding mixed signal functionalities, and penetrating new markets, affirming optimism about future opportunities.

Guidance
For Q1 fiscal year 2026, Cirrus Logic expects revenue between $330 million and $390 million, reflecting a 15% sequential decline and a 4% year-over-year decrease at the midpoint. Gross margin is anticipated to range from 51% to 53%. Non-GAAP operating expenses are projected between $119 million and $125 million, influenced by employee-related costs. The company estimates its non-GAAP tax rate for fiscal year 2026 will be approximately 21% to 23%.

Additional News
Cirrus Logic announced that its Board of Directors authorized the repurchase of up to an additional $500 million of the company's common stock in March 2025. These repurchases are planned to be funded through working capital and anticipated cash flow from operations, with execution dependent on market conditions and corporate considerations. The repurchase could occur via various methods, including open market purchases, privately negotiated transactions, or 10b5-1 plans. Furthermore, Cirrus Logic is recognized globally for its award-winning corporate culture, highlighting its commitment to fostering a positive work environment.