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1. Company Snapshot

1.a. Company Description

Cirrus Logic, Inc., a fabless semiconductor company, provides low-power and high-precision mixed-signal processing solutions in the United States and internationally.It offers portable products, including codecs components that integrate analog-to-digital converters (ADCs) and digital-to-analog converters (DACs) into a single integrated circuit (IC); smart codecs, a codec with digital signal processer; boosted amplifiers; digital signal processors; and SoundClear technology, which consists of a portfolio of tools, software, and algorithms that helps to enhance user experience with features, such as louder, high-fidelity sound, audio playback, voice capture, hearing augmentation, and active noise cancellation.The company's audio products are used in smartphones, tablets, wireless headsets, laptops, AR/VR headsets, home theater systems, automotive entertainment systems, and professional audio systems.


It also provides high-performance mixed-signal products, such as haptic driver and sensing solutions, camera controllers, power conversion, and control ICs and fast-charging ICs used in various industrial and energy applications comprising digital utility meters, power supplies, energy control, energy measurement, and energy exploration.The company markets and sells its products through direct sales force, external sales representatives, and distributors.Cirrus Logic, Inc.


was incorporated in 1984 and is headquartered in Austin, Texas.

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1.b. Last Insights on CRUS

Cirrus Logic's recent performance was driven by strong Q2 earnings, with EPS of $2.83, beating estimates of $2.4. Robust smartphone demand and expanding presence in the PC market fueled growth. The company has been upgraded to a Zacks Rank #1 (Strong Buy), indicating growing optimism about earnings prospects. Additionally, institutional investors, such as Sequoia Financial Advisors and Teacher Retirement System of Texas, have increased their stakes in the company. Analysts have boosted their forecasts following the upbeat earnings report.

1.c. Company Highlights

2. Cirrus Logic Beats Earnings Expectations on Strong Smartphone Demand

Cirrus Logic delivered a record September quarter revenue of $561 million, driven primarily by demand for its components shipping into smartphones. The company's non-GAAP gross profit was $294.7 million, with a non-GAAP gross margin of 52.5%. Non-GAAP earnings per share (EPS) came in at $2.83, surpassing estimates of $2.37. The strong EPS was supported by a favorable tax impact of 14.6% for the quarter. The company's financial performance was robust, with a non-GAAP operating income of $167 million, or 29.8% of revenue.

Publication Date: Nov -14

📋 Highlights
  • Record Revenue:: Q3 revenue reached $561 million, driven by smartphone component demand, including custom-boosted amplifiers and smart codecs with 5-6 year lifespans.
  • Strong Financial Performance:: Non-GAAP gross margin hit 52.5%, operating income was 29.8% of revenue ($167M), and EPS reached $2.83 due to a 14.6% tax benefit.
  • Robust Balance Sheet:: $896 million in cash and investments, no debt, and inventory reduced to $236.4 million from $279 million in the prior quarter.
  • PC Market Expansion:: Expecting growth with mainstream laptop wins and new AI-driven voice features; Q3 2026 revenue guidance set at $500–560 million.
  • Strategic Focus Areas:: Prioritizing flagship smartphone audio, mixed-signal solutions (camera controllers), and PC market expansion, leveraging SoundWire and voice IP for momentum.

Revenue Diversification Efforts

Cirrus Logic is actively diversifying its revenue streams beyond its core flagship smartphone audio business. The company is expanding its high-performance mixed-signal solutions, including camera controllers, which remain a key differentiator in the latest generation of devices. Additionally, Cirrus Logic is making inroads into the PC market, where it is gaining share across customers and product tiers. As noted by John Forsyth, the PC market is a significant growth area, with the company having made progress in passing milestones and winning mainstream consumer laptop designs.

Guidance and Outlook

Looking ahead, Cirrus Logic expects revenue in the range of $500 million to $560 million for Q3 fiscal 2026, with a gross margin range of 51% to 53%. Non-GAAP operating expense is expected to range from $128 million to $134 million. The company's guidance suggests a continued strong performance, albeit with some seasonality expected to follow historical trends, as noted by Jeffrey Woolard in response to a question about changes to the smartphone unit outlook.

Valuation Metrics

Based on the current stock price, the company's P/E Ratio stands at 16.12, indicating a relatively reasonable valuation compared to its earnings growth. The P/S Ratio is 3.13, and the EV/EBITDA ratio is 11.0. The company's Return on Equity (ROE) is 19.26%, and Return on Invested Capital (ROIC) is 15.78%, indicating a strong ability to generate returns for shareholders. With a Free Cash Flow Yield of 8.86%, the stock appears to offer attractive value. Analysts estimate next year's revenue growth at 1.4%, which, combined with the current valuation metrics, suggests that the stock may be fairly valued.

3. NewsRoom

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Cirrus Logic to Present at Upcoming Conference

Dec -04

Source: businesswire.com

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Cirrus Introduces ‘Cirrus Next' Aircraft Trade-In and Upgrade Program

Dec -02

Source: businesswire.com

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Bull of the Day: Cirrus Logic (CRUS)

Dec -02

Source: zacks.com

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Best Momentum Stocks to Buy for Dec.1

Dec -01

Source: zacks.com

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Creative Planning Buys 3,255 Shares of Cirrus Logic, Inc. $CRUS

Nov -27

Source: defenseworld.net

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Bailard Inc. Purchases Shares of 5,200 Cirrus Logic, Inc. $CRUS

Nov -15

Source: defenseworld.net

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Chuck Royce's Strategic Moves: Significant Reduction in Air Lease Corp

Nov -12

Source: gurufocus.com

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Zacks Industry Outlook like Lam Research, Cirrus Logic and FormFactor

Nov -07

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (9.42%)

6. Segments

Audio Products

Expected Growth: 10.02%

Cirrus Logic's 10.02% growth in Audio Products is driven by increasing demand for smartphones and tablets, adoption of true wireless stereo (TWS) earbuds, and rising sales of smart speakers. Additionally, the company's focus on audio codecs, amplifiers, and haptic drivers for gaming consoles and PCs contributes to its growth.

High-Performance Mixed-Signal Products

Expected Growth: 8.45%

Cirrus Logic's high-performance mixed-signal products drive growth through increasing demand for audio and voice-enabled devices, adoption of wireless audio technologies, and rising need for power management in IoT and automotive applications, coupled with the company's strong relationships with leading OEMs and its ability to innovate and expand product offerings.

7. Detailed Products

Audio Codecs

Cirrus Logic's audio codecs are high-performance, low-power audio converters that enable high-quality audio playback and recording in portable devices, home audio systems, and automotive infotainment systems.

Smart Codec

Cirrus Logic's Smart Codec is a low-power, high-performance audio codec that integrates a digital signal processor (DSP) and analog-to-digital converter (ADC) to provide advanced audio processing capabilities.

Haptic Drivers

Cirrus Logic's haptic drivers are high-performance, low-power drivers that enable advanced haptic feedback in smartphones, gaming controllers, and virtual reality (VR) devices.

Power Amplifiers

Cirrus Logic's power amplifiers are high-performance, low-power amplifiers that enable high-quality audio playback in portable devices, home audio systems, and automotive infotainment systems.

Audio DSPs

Cirrus Logic's audio DSPs are high-performance, low-power digital signal processors that enable advanced audio processing capabilities in portable devices, home audio systems, and automotive infotainment systems.

8. Cirrus Logic, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Cirrus Logic, Inc. operates in the semiconductor industry, which is characterized by rapid technological advancements. While there are substitutes available, the company's focus on audio and high-performance mixed-signal processing has helped it maintain a competitive edge.

Bargaining Power Of Customers

Cirrus Logic, Inc. has a diverse customer base, including major players in the consumer electronics industry. However, the company's products are highly customized, which reduces the bargaining power of customers.

Bargaining Power Of Suppliers

Cirrus Logic, Inc. relies on a few key suppliers for its manufacturing process. While the company has some bargaining power due to its size, the suppliers also have some leverage due to the specialized nature of their products.

Threat Of New Entrants

The semiconductor industry has high barriers to entry, including significant capital expenditures and technological expertise. This makes it difficult for new entrants to compete with established players like Cirrus Logic, Inc.

Intensity Of Rivalry

The semiconductor industry is highly competitive, with many established players competing for market share. Cirrus Logic, Inc. faces intense competition from companies like Texas Instruments, Analog Devices, and STMicroelectronics.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 7.87%
Debt Cost 8.88%
Equity Weight 92.13%
Equity Cost 8.88%
WACC 8.88%
Leverage 8.54%

11. Quality Control: Cirrus Logic, Inc. passed 8 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Cirrus Logic

A-Score: 5.0/10

Value: 4.0

Growth: 7.1

Quality: 8.4

Yield: 0.0

Momentum: 5.0

Volatility: 5.7

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Skyworks Solutions

A-Score: 4.9/10

Value: 4.6

Growth: 4.3

Quality: 6.8

Yield: 6.0

Momentum: 2.0

Volatility: 5.3

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Amkor Technology

A-Score: 4.3/10

Value: 4.6

Growth: 5.4

Quality: 4.8

Yield: 3.0

Momentum: 4.0

Volatility: 3.7

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Universal Display

A-Score: 4.2/10

Value: 1.2

Growth: 6.6

Quality: 8.6

Yield: 2.0

Momentum: 1.5

Volatility: 5.3

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Veeco Instruments

A-Score: 4.0/10

Value: 3.0

Growth: 5.9

Quality: 5.9

Yield: 0.0

Momentum: 5.0

Volatility: 4.3

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Vishay

A-Score: 3.8/10

Value: 7.5

Growth: 1.9

Quality: 2.7

Yield: 4.0

Momentum: 3.0

Volatility: 4.0

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

123.82$

Current Price

123.82$

Potential

-0.00%

Expected Cash-Flows