Semtech Q2 Earnings Call Highlights

Record results: Semtech reported fiscal Q2 revenue of $342 million, up 33% year over year, while adjusted EPS rose 73% to $0.71. Data center revenue reached a record $100 million, driven by strong demand for 800G and 1.6T products.

LoRa momentum continued: LoRa-enabled revenue climbed 58% year over year to a record $58 million, and the company expects roughly 65% year-over-year LoRa growth in Q3.

Growth and margin outlook strengthened: Semtech forecast Q3 revenue of $410 million at the midpoint, up 54% year over year, and expects the cellular-module divestiture to improve adjusted gross margin by more than 500 basis points.

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Semtech (NASDAQ:SMTC) reported record fiscal second-quarter revenue and projected further growth in its data center, LoRa and consumer businesses, while advancing a planned divestiture of its cellular module operation.

For the quarter ended July 26, 2026, the company reported revenue of $342 million, up 17% sequentially and 33% from a year earlier. Adjusted diluted earnings per share were $0.71, up 39% sequentially and 73% year over year. President and CEO Hong Hou said the results reflected record revenue in the company's key focus areas, growing operating leverage and progress in portfolio optimization.

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Adjusted gross margin was 54.5%, an increase of 150 basis points from the prior quarter. Adjusted operating income totaled $84 million, while adjusted EBITDA was $91 million. Semtech generated operating cash flow of $69 million and free cash flow of $61 million during the quarter. It ended the period with $204 million in cash and cash equivalents, $503 million in principal debt and a net leverage ratio of 1.1.

Data Center Business Drives Infrastructure Growth

Infrastructure revenue was $124 million, up 25% sequentially and 69% year over year, led by a record $100 million in data center revenue. Data center sales increased 39% from the prior quarter and 91% from a year earlier, supported by 800G products, 1.6T CopperEdge products and the initial ramp of 1.6T FiberEdge offerings.

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Hou said Semtech is seeing strong demand for FiberEdge transimpedance amplifier and driver solutions, along with broader customer engagement around emerging optical architectures including MPO and XPO. He said the company expects FiberEdge to exceed 50% market share in its targeted 1.6T market by the end of the fiscal year.