Revenue for the quarter reached $230.6 million, a 104% year‑over‑year increase and 20% sequential growth from the $192.5 million reported in Q2 2025. The jump reflects a richer product mix that shifted toward higher‑margin signal‑conditioning and smart‑cable‑module (SCM) units, as well as a strong ramp of PCIe Gen 6 and Taurus Ethernet SCMs that together accounted for more than 20% of total revenue. The company beat the consensus estimate of $206.4 million by $24.2 million, underscoring robust demand from data‑center and AI‑platform customers.
The diluted earnings per share were $0.49, surpassing the analyst expectation of $0.39 by $0.10, or 25.6%. The beat was driven by disciplined cost management and a favorable product mix that lifted gross margin, while operating expenses grew at a slower pace than revenue. No material one‑time charges were recorded, allowing the company to convert the revenue growth into a strong earnings performance.
Gross margin expanded to 76.2% on a GAAP basis, up 100 basis points from the 75.2% reported in Q2 2025. Non‑GAAP gross margin was 76.4%, reflecting the same mix shift and improved pricing power. The margin lift is attributed to higher sales of the Scorpio X‑Series and Aries products, which carry higher gross margins, and to operational efficiencies that reduced cost of goods sold as production volumes increased.
Management guided fourth‑quarter revenue to $245 million to $253 million and adjusted EPS to $0.50 to $0.51. The guidance range signals confidence in continued PCIe 6 momentum and the ramp of Taurus SCMs, while the spread indicates some uncertainty about the exact mix of product sales and the pace of new‑product adoption. The company reiterated its focus on scaling AI‑infrastructure connectivity and maintaining margin expansion as it expands its customer base in Asia and the United States.
CEO Jitendra Mohan said the quarter “demonstrated strong demand and upside across our signal‑conditioning, smart‑cable‑module, and switch‑fabric portfolios as new AI platforms ramped up production.” CFO Michael Tate added that the 104% year‑over‑year revenue growth and a non‑GAAP operating margin of 41.7%—up 250 basis points from Q2—highlight the company’s ability to scale while preserving profitability.
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