FormFactor (NASDAQ:FORM) Releases Quarterly Earnings Results, Beats Estimates By $0.18 EPS

FormFactor (NASDAQ:FORM) announced its quarterly earnings results on Wednesday. The semiconductor company reported $1.04 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.86 by $0.18, FiscalAI reports. The company had revenue of $280.55 million for the quarter, compared to analysts’ expectations of $270.52 million. FormFactor had a net margin of 17.72% and a return on equity of 18.88%. FormFactor’s revenue was up 38.4% compared to the same quarter last year. During the same quarter in the previous year, the business posted $0.33 EPS.

Here are the key takeaways from FormFactor’s conference call:

• Positive Sentiment: FormFactor reported a strong third quarter, with revenue up 9% sequentially and nearly 40% year over year to $280.5 million; non-GAAP gross margin reached 56.5% and EPS was $1.04, exceeding the high end of guidance. Fourth-quarter revenue is expected at approximately $285 million, putting the company on track to surpass $1 billion in 2026 revenue.
• Positive Sentiment: Demand is broadening across high-performance computing, including GPUs, custom ASICs, CPUs, HBM, and advanced packaging. The company shipped probe cards in multimillion-dollar volumes for a leading GPU design and expects significant share gains in GPUs and custom ASICs in 2027.
• Positive Sentiment: The new Farmers Branch facility is ramping slightly ahead of schedule, with its first production unit already shipped and an expected exit-2027 annual probe-card capacity of approximately $400 million. FormFactor also secured a $300 million investment from Teradyne as part of an expanded partnership covering next-generation semiconductor test solutions.
• Positive Sentiment: Underlying non-GAAP gross-margin performance improved to a roughly 53% baseline, driven by better yields, cycle times, labor performance, and manufacturing efficiency. Management expects Farmers Branch ramp inefficiencies to be largely offset by higher volumes and operational improvements, although the quarter’s 300-basis-point tariff-refund benefit and other favorable items are not recurring.
• Neutral Sentiment: Systems revenue reached a record $59.5 million, driven by TRITON photonic systems, and 2026 TRITON revenue expectations increased to more than $30 million from an initial $10 million-$20 million forecast. Management sees strong early adoption of co-packaged optics, near-package optics, and pluggable applications, but noted that CPO demand remains concentrated in one ecosystem.

FormFactor Price Performance

Shares of FORM stock traded down $12.55 during mid-day trading on Friday, hitting $84.91. The company had a trading volume of 1,824,601 shares, compared to its average volume of 1,650,754. The company has a market capitalization of $6.62 billion, a P/E ratio of 38.64 and a beta of 1.18. FormFactor has a 52-week low of $47.33 and a 52-week high of $160.27. The company has a debt-to-equity ratio of 0.01, a current ratio of 4.08 and a quick ratio of 3.34. The stock’s 50 day moving average price is $116.81 and its 200-day moving average price is $113.36.

Wall Street Analyst Weigh In

A number of analysts have commented on FORM shares. Weiss Ratings raised FormFactor from a “hold (c)” rating to a “hold (c+)” rating in a report on Friday, October 16th. B. Riley Financial reissued a “buy” rating on shares of FormFactor in a research report on Monday, October 19th. TD Cowen raised their price target on shares of FormFactor from $100.00 to $110.00 and gave the company a “hold” rating in a report on Thursday. Wall Street Zen lowered shares of FormFactor from a “strong-buy” rating to a “buy” rating in a research note on Sunday, August 9th. Finally, Stifel Nicolaus set a $115.00 price objective on shares of FormFactor in a research report on Tuesday, October 13th. Seven investment analysts have rated the stock with a Buy rating and five have given a Hold rating to the company. Based on data from MarketBeat.com, FormFactor has an average rating of “Moderate Buy” and a consensus price target of $139.73.

Key FormFactor News

Here are the key news stories impacting FormFactor this week:

• Positive Sentiment: FormFactor reported record third-quarter revenue of $280.5 million, up 38.4% year over year, while adjusted EPS of $1.04 exceeded the $0.86 consensus estimate. Revenue, gross margin and earnings also surpassed the high end of management’s prior outlook. FormFactor 2026 Third Quarter Results
• Positive Sentiment: Demand for probe cards, DRAM, foundry and logic testing, photonics and AI-related applications—including HBM4 testing—is supporting growth. The Farmers Branch facility is expected to help expand probe-card capacity toward a roughly $400 million annual exit rate by 2027. FORM HBM and Foundry Testing Outlook
• Positive Sentiment: Fourth-quarter EPS guidance of $0.86-$1.04 is above the $0.79 consensus estimate, and the company’s addition to the Zacks Rank #1 Strong Buy list provides a favorable analyst signal.
• Neutral Sentiment: TD Cowen raised its price target from $100 to $110 but maintained a Hold rating, suggesting analysts see upside while remaining cautious about execution and valuation.
• Negative Sentiment: Fourth-quarter revenue guidance of $275 million-$295 million implies only modest sequential growth at the midpoint. Management said its current manufacturing footprint is nearing capacity, while the Texas expansion may experience ramp-related inefficiencies. FormFactor Sinks Despite Record Quarter
• Negative Sentiment: Fourth-quarter non-GAAP gross margin is expected to decline to about 54% from the third quarter, raising concerns that capacity limitations and factory start-up costs could restrain near-term earnings momentum.
• Negative Sentiment: Recent trading data shows substantial insider selling, including sales by CEO Mike Slessor, with no reported insider purchases over the past six months. This may reinforce investor caution.

Insider Buying and Selling

In other FormFactor news, CEO Mike Slessor sold 17,510 shares of FormFactor stock in a transaction that occurred on Wednesday, September 16th. The stock was sold at an average price of $104.73, for a total value of $1,833,822.30. Following the sale, the chief executive officer owned 466,694 shares of the company’s stock, valued at $48,876,862.62. The trade was a 3.62% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is available through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Kelley Steven-Waiss sold 2,100 shares of the stock in a transaction on Thursday, September 3rd. The shares were sold at an average price of $96.10, for a total transaction of $201,810.00. Following the transaction, the director owned 24,426 shares of the company’s stock, valued at $2,347,338.60. This trade represents a 7.92% decrease in their position. The SEC filing for this sale provides additional information. Over the last three months, insiders have sold 46,710 shares of company stock valued at $5,520,564. 0.79% of the stock is owned by corporate insiders.

About FormFactor

FormFactor, Inc is a semiconductor test and measurement company that designs and manufactures equipment and components used to evaluate integrated circuits during the wafer fabrication and production process. Its products help semiconductor manufacturers and suppliers measure electrical performance, identify defects and improve the development and manufacturing of advanced chips.

The company’s portfolio includes probe cards used for wafer-level testing, as well as probe stations, analytical systems and related accessories for semiconductor engineering and production applications.