Power Integrations (NASDAQ:POWI) Releases Quarterly Earnings Results, Beats Expectations By $0.04 EPS

Power Integrations (NASDAQ:POWI) announced its earnings results on Wednesday. The semiconductor company reported $0.46 earnings per share for the quarter, beating the consensus estimate of $0.42 by $0.04, FiscalAI reports. The business had revenue of $125.48 million during the quarter, compared to analysts’ expectations of $126.03 million. Power Integrations had a return on equity of 7.42% and a net margin of 9.81%. The company’s quarterly revenue was up 5.5% on a year-over-year basis. During the same quarter last year, the business posted $0.36 earnings per share.

Here are the key takeaways from Power Integrations’ conference call:

• Profitability and cash generation improved: Q3 revenue rose 6% year over year to $125.5 million, while non-GAAP operating margin reached 21.4% and EPS increased 28% year over year. The company also generated $37 million in free cash flow and raised its quarterly dividend.
• Q4 outlook implies continued growth: The company forecast revenue of $118 million to $126 million, with the midpoint representing 18% year-over-year growth, and expects non-GAAP gross margin of about 55%. Management attributed the outlook to industrial strength and recent design wins, while noting softer consumer demand and supply constraints.
• Elevated channel inventory and supply issues remain risks: Channel inventory rose 4.5 weeks to 11.8 weeks amid weak appliance demand, delayed metering projects, and customers’ higher buffer-stock requirements; management expects inventory to remain above target and potentially sit at 9–10 weeks next year. Separately, high-power demand currently exceeds supply, with packaging and PCB constraints limiting the company’s ability to fulfill it.
• GaN and strategic-market opportunities are expanding: Power Integrations reported strong GaN design-win momentum, growing data-center opportunities—including four 800-volt auxiliary-power design-ins expected to enter production in 2027—and a larger automotive pipeline. Management sees potential to double its serviceable addressable market by 2031, though main-path data-center products are expected to roll out in 2028–2029.

Power Integrations Stock Up 3.5%

Shares of NASDAQ POWI traded up $1.37 during mid-day trading on Friday, hitting $40.21. 1,270,400 shares of the company traded hands, compared to its average volume of 951,649. Power Integrations has a 1 year low of $30.86 and a 1 year high of $91.18. The stock has a market capitalization of $2.25 billion, a price-to-earnings ratio of 50.90 and a beta of 1.58. The business has a 50 day moving average of $49.17 and a two-hundred day moving average of $58.58.

Power Integrations Dividend Announcement

The business also recently announced a quarterly dividend, which will be paid on Thursday, December 31st. Stockholders of record on Monday, November 30th will be issued a dividend of $0.2150 per share. This represents a $0.86 annualized dividend and a dividend yield of 2.1%. The ex-dividend date of this dividend is Monday, November 30th. Power Integrations’s dividend payout ratio is currently 108.86%.

Analyst Upgrades and Downgrades

A number of equities research analysts have weighed in on POWI shares. Stifel Nicolaus set a $62.00 price target on shares of Power Integrations in a report on Thursday. Zacks Research downgraded shares of Power Integrations from a “strong-buy” rating to a “hold” rating in a report on Monday, July 20th. Susquehanna dropped their target price on shares of Power Integrations from $70.00 to $55.00 and set a “positive” rating on the stock in a report on Thursday. Needham & Company LLC cut their target price on shares of Power Integrations from $80.00 to $65.00 and set a “buy” rating for the company in a research note on Thursday. Finally, Williams Trading set a $65.00 target price on shares of Power Integrations in a report on Thursday. Four analysts have rated the stock with a Buy rating and four have issued a Hold rating to the stock. According to data from MarketBeat.com, the stock currently has an average rating of “Moderate Buy” and an average target price of $59.67.

Trending Headlines about Power Integrations

Here are the key news stories impacting Power Integrations this week:

• Positive Sentiment: Third-quarter adjusted earnings were $0.46 per share, beating estimates of $0.42 and rising from $0.36 a year earlier. Revenue grew 5.5% year over year to $125.48 million. Zacks Q3 earnings report
• Positive Sentiment: The company declared a quarterly dividend of $0.215 per share, equivalent to $0.86 annually and a stated yield of 2.2%. Dividend announcement
• Neutral Sentiment: Power Integrations guided to fourth-quarter revenue of $118 million to $126 million and outlined a goal of doubling its serviceable addressable market by 2031, signaling long-term ambition but leaving near-term growth dependent on execution. Company outlook and market opportunity
• Negative Sentiment: Shares were caught in broad sector-wide selling. Susquehanna lowered its price target from $70 to $55, while keeping a positive rating; Needham cut its target from $80 to $65 but retained a buy rating. The target cuts may weigh on sentiment despite the firms’ continued bullish ratings. Sector selling report Susquehanna price target report

Power Integrations Company Profile

Power Integrations, Inc designs and manufactures high-performance semiconductor technologies used in energy-efficient power conversion. Its products help convert and control electrical power in applications such as consumer electronics, appliances, industrial equipment, communications infrastructure, renewable-energy systems, and electric vehicles.

The company’s product portfolio includes integrated circuits for AC-to-DC and DC-to-DC power supplies, LED lighting drivers, power-factor correction, motor drives, and high-voltage gate driving.