FormFactor, Inc. Reports 2026 Third Quarter Results

FormFactor posts record Q3 results with strong revenue, profit, and cash flow growth.

What the company is saying

FormFactor, Inc. reports its fourth consecutive quarterly revenue record, with Q3 2026 revenue at $280.5 million, up 8.6% sequentially and 38.4% year-over-year. The company highlights broad-based demand, citing 10% sequential growth in Foundry & Logic and over 20% growth in Systems, driven by co-packaged optics. CEO Mike Slessor emphasizes that revenue, gross margin, and earnings per share exceeded the high end of guidance, attributing this to the company's diversified leadership in high-performance compute and advanced packaging, as well as operational leverage from its existing manufacturing footprint. The company also notes an expanded partnership with Teradyne to accelerate next-generation semiconductor development and production. Looking ahead, FormFactor is bringing its new Farmers Branch factory online to address capacity constraints and support continued growth. The Q4 2026 outlook projects revenue of $285 million +/- $10 million, with GAAP gross margin at 52.3% +/- 1.5% and non-GAAP gross margin at 54.0% +/- 1.5%. The tone is confident, with management positioning the company as well-placed to meet rising customer demand.

What the data suggests

Q3 2026 revenue reached $280.5 million, an 8.6% increase from Q2 2026 and 38.4% above Q3 2025, confirming a strong upward trajectory. GAAP net income for the quarter was $73.8 million, or $0.93 per diluted share, up from $56.2 million ($0.71) in Q2 and $15.7 million ($0.20) a year ago. Non-GAAP net income was $82.3 million, or $1.04 per diluted share, up from $65.0 million ($0.82) in Q2 and $25.7 million ($0.33) in Q3 2025. GAAP gross margin improved to 54.7% from 50.7% in Q2 and 39.8% in Q3 2025; non-GAAP gross margin was 56.5%. Operating cash flow rose to $104.3 million, with free cash flow at $64.8 million, both more than doubling year-over-year. The company’s segment growth was broad-based, with Systems segment revenue growing over 20% sequentially. Management attributes these results to strong demand and increased manufacturing output. The Q4 2026 guidance implies continued strength, with projected revenue of $285 million +/- $10 million and non-GAAP EPS of $0.95 +/- $0.09. The numbers are comprehensive and support the company’s narrative of accelerating growth and operational leverage.

Analysis

The announcement's tone is positive but proportionate to the strong, realised financial results disclosed. The company reports record quarterly revenues, significant year-over-year and sequential growth, and substantial improvements in profitability and cash flow, all supported by detailed GAAP and non-GAAP figures. Forward-looking statements are limited to Q4 2026 guidance and the ramp-up of the new Farmers Branch factory, both of which are near-term and operationally grounded. The only minor inflation is the CEO's claim of exceeding guidance, which cannot be independently verified due to the absence of prior guidance figures, but this does not materially affect the overall signal. The capital intensity flag is set due to the new factory coming online, but this is disclosed transparently and is already in progress. There is no evidence of narrative inflation or overstatement relative to the disclosed facts.

Risk flags

• ●Capacity constraints are emerging as productivity gains from the existing manufacturing footprint moderate, making timely ramp-up of the new Farmers Branch factory critical to sustaining growth. Delays or operational issues at this new facility could limit the company’s ability to meet ongoing demand.
• ●The company’s strong results are partly driven by high demand in specific segments such as co-packaged optics; any cyclical downturn or technology shift in these areas could impact future revenue and margin performance.
• ●The announcement does not disclose the specific prior guidance figures, which prevents independent verification of the claim that results exceeded the high end of guidance. While this does not undermine the strong reported results, it reduces transparency around management’s guidance process.
• ●FormFactor operates in a sector exposed to global supply chain risks, trade restrictions, and geopolitical tensions, particularly with references to North America and China. Disruptions in these regions could affect both demand and operational continuity.
• ●The company is investing in new capacity and partnerships, which increases capital intensity and execution complexity. If demand softens or ramp-up costs overrun, returns on these investments could be pressured.

Bottom line

FormFactor’s Q3 2026 results demonstrate robust financial momentum, with revenue, profit, and cash flow all posting substantial sequential and year-over-year gains. The company’s operational leverage is evident in expanding margins and cash generation, while segment growth is broad-based and driven by demand for advanced semiconductor test solutions. The near-term outlook remains strong, supported by imminent capacity expansion at the Farmers Branch factory and an expanded partnership with Teradyne. Risks include the need to execute the factory ramp-up smoothly, maintain demand in key segments, and navigate sector-specific geopolitical and supply chain challenges. The absence of specific prior guidance figures is a minor transparency gap but does not detract from the overall strength of the results. The most important takeaway is that FormFactor is delivering on both growth and profitability, positioning itself as a leader in a structurally attractive segment of the semiconductor supply chain.

Announcement summary

(NASDAQ:FORM) FormFactor, Inc. announced financial results for the third quarter of fiscal 2026 ended September 26, 2026. Quarterly revenues were $280.5 million, up 8.6% from $258.2 million in Q2 2026 and up 38.4% from $202.7 million in Q3 2025. This marks the fourth consecutive quarterly revenue record, with revenue nearly 40% higher than the prior year quarter. Foundry & Logic segment revenue grew 10% sequentially, and Systems segment revenue grew over 20% sequentially due to higher demand for co-packaged optics. After the quarter, FormFactor announced an expansion of its partnership with Teradyne to accelerate development, validation, and high-volume production of next-generation semiconductor applications. CEO Mike Slessor stated that the company exceeded the high end of its guidance for revenue, gross margin, and earnings per share, attributing this to strong demand and increased output within the existing manufacturing footprint. On a GAAP basis, Q3 2026 net income was $73.8 million, or $0.93 per diluted share, compared to $56.2 million, or $0.71 per diluted share in Q2 2026, and $15.7 million, or $0.20 per diluted share in Q3 2025. GAAP gross margin for Q3 2026 was 54.7%, up from 50.7% in Q2 2026 and 39.8% in Q3 2025. On a non-GAAP basis, Q3 2026 net income was $82.3 million, or $1.04 per diluted share, compared to $65.0 million, or $0.82 per diluted share in Q2 2026, and $25.7 million, or $0.33 per diluted share in Q3 2025. Non-GAAP gross margin for Q3 2026 was 56.5%, compared to 53.3% in Q2 2026 and 41.0% in Q3 2025. GAAP net cash provided by operating activities for Q3 2026 was $104.3 million, compared to $61.8 million in Q2 2026 and $27.0 million in Q3 2025. Free cash flow for Q3 2026 was $64.8 million, compared to $52.6 million in Q2 2026 and $19.7 million in Q3 2025. For Q4 2026, FormFactor provided an outlook of revenue at $285 million +/- $10 million, GAAP gross margin at 52.3% +/- 1.5%, non-GAAP gross margin at 54.0% +/- 1.5%, GAAP net income per diluted share at $0.84 +/- $0.09, and non-GAAP net income per diluted share at $0.95 +/- $0.09. The company is bringing its new Farmers Branch factory online to provide additional capacity as productivity gains from the existing footprint moderate. The company posted its revenue breakdown by geographic region, market segment, and customers with greater than 10% of total revenue on its Investor Relations website. FormFactor serves customers through its network of facilities in Asia, Europe, and North America.

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