Q3 Revenue, Gross Margin and Earnings per Share Exceed the Midpoint of the Outlook Range;

Expects to Deliver Higher Results in the Fourth Quarter

LIVERMORE, Calif., Oct. 29, 2025 (GLOBE NEWSWIRE) -- FormFactor, Inc. (NASDAQ:FORM) today announced its financial results for the third quarter of fiscal 2025 ended September 27, 2025. Quarterly revenues were $202.7 million, an increase of 3.5% compared to $195.8 million in the second quarter of fiscal 2025, and a decrease of 2.5% from $207.9 million in the third quarter of fiscal 2024.

Third quarter revenue, gross margin, and earnings per share exceeded both second quarter results and the midpoint of the outlook range
DRAM probe cards recorded expected double-digit sequential growth, reaching a new record, primarily from growth in HBM
Systems Segment delivered anticipated third quarter revenue increase, with additional growth expected in the fourth quarter with increased momentum towards initial volume production of co-packaged optics

"As we said last quarter, we are focused on, and committed to, improving our profitability as we return to a path to our target model," said Mike Slessor, CEO of FormFactor, Inc. "We are executing a program of rapid and immediate gross margin improvement actions that have already produced the 250 basis point increase from the second quarter, and which we anticipate will continue in the fourth quarter and throughout next year. At the same time, we are executing longer-term structural initiatives that we expect will contribute further to our gross margins."

Third Quarter Highlights

On a GAAP basis, net income for the third quarter of fiscal 2025 was $15.7 million, or $0.20 per fully-diluted share, compared to net income for the second quarter of fiscal 2025 of $9.1 million, or $0.12 per fully-diluted share, and net income for the third quarter of fiscal 2024 of $18.7 million, or $0.24 per fully-diluted share. Gross margin for the third quarter of 2025 was 39.8%, compared with 37.3% in the second quarter of 2025, and 40.7% in the third quarter of 2024.

On a non-GAAP basis, net income for the third quarter of fiscal 2025 was $25.7 million, or $0.33 per fully-diluted share, compared to net income for the second quarter of fiscal 2025 of $21.2 million, or $0.27 per fully-diluted share, and net income for the third quarter of fiscal 2024 of $27.2 million, or $0.35 per fully-diluted share. On a non-GAAP basis, gross margin for the third quarter of 2025 was 41.0%, compared with 38.5% in the second quarter of 2025, and 42.2% in the third quarter of 2024.

GAAP net cash provided by operating activities for the third quarter of fiscal 2025 was $27.0 million, compared to $18.9 million for the second quarter of fiscal 2025, and $26.7 million for the third quarter of fiscal 2024. Free cash flow for the third quarter of fiscal 2025 was $19.7 million, compared to free cash flow for the second quarter of fiscal 2025 of negative $47.1 million, and free cash flow for the third quarter of 2024 of $20.0 million.

A reconciliation of GAAP to non-GAAP measures is provided in the schedules included below.

Outlook

Dr. Slessor added, "Our outlook for the current fourth quarter builds on the third quarter, as our initiatives of profitability improvement actions continues, and we expect to again deliver sequentially higher revenue, earnings, and most importantly, gross margin."

For the fourth quarter ending December 27, 2025, FormFactor is providing the following outlook*:

	GAAP	Reconciling Items**	Non-GAAP
Revenue	$210 million +/- $5 million	—	$210 million +/- $5 million
Gross margin	40.0% +/- 1.5%	$4.5 million	42.0% +/- 1.5%
Net income per diluted share	$0.19 +/- $0.04	$0.16	$0.35 +/- $0.04

*This outlook assumes consistent foreign currency rates.

**Reconciling items are stock-based compensation, amortization of intangible assets and fixed asset fair value adjustments due to acquisitions, and restructuring charges, net of applicable income tax impacts.

We posted our revenue breakdown by geographic region, by market segment and with customers with greater than 10% of total revenue on the Investor Relations section of our website at www.formfactor.com. We will conduct a conference call at 1:25 p.m. PT, or 4:25 p.m. ET, today.

The public is invited to listen to a live webcast of FormFactor's conference call on the Investor Relations section of our website at www.formfactor.com. A telephone replay of the conference call will be available approximately two hours after the conclusion of the call. The replay will be available on the Investor Relations section of our website, www.formfactor.com.

Use of Non-GAAP Financial Information:

To supplement our condensed consolidated financial results prepared under generally accepted accounting principles, or GAAP, we disclose certain non-GAAP measures of non-GAAP net income, non-GAAP net income per basic and diluted share, non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating income and free cash flow, that are adjusted from the nearest GAAP financial measure to exclude certain costs, expenses, gains and losses. Reconciliations of the adjustments to GAAP results for the three and nine months ended September 27, 2025, and for outlook provided before, as well as for the comparable periods of fiscal 2024, are provided below, and on the Investor Relations section of our website at www.formfactor.com. Information regarding the ways in which management uses non-GAAP financial information to evaluate its business, management's reasons for using this non-GAAP financial information, and limitations associated with the use of non-GAAP financial information, is included under "About our Non-GAAP Financial Measures" following the tables below.

About FormFactor:

FormFactor, Inc. (NASDAQ:FORM), is a leading provider of essential test and measurement technologies along the full semiconductor product life cycle - from characterization, modeling, reliability, and design de-bug, to qualification and production test. Semiconductor companies rely upon FormFactor's products and services to accelerate profitability by optimizing device performance and advancing yield knowledge. The Company serves customers through its network of facilities in Asia, Europe, and North America. For more information, visit the Company's website at www.formfactor.com.

Forward-looking Statements:

This press release contains forward-looking statements within the meaning of the "safe harbor" provisions of the federal securities laws, including with respect to the Company's future financial and operating results, and the Company's plans, strategies and objectives for future operations. These statements are based on management's current expectations and beliefs as of the date of this release, and are subject to a number of risks and uncertainties, many of which are beyond the Company's control, that could cause actual results to differ materially from those described in the forward-looking statements. These forward-looking statements include, but are not limited to, statements regarding future financial and operating results, including under the heading "Outlook" above, and the Company's performance, and other statements regarding the Company's business. Forward-looking statements may contain words such as "may," "might," "will," "expect," "plan," "anticipate," "forecast," "continue," and "prospect," and the negative or plural of these words and similar expressions, and include the assumptions that underlie such statements. The following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements: changes in and impacts from export control, tariffs and other trade barriers; changes in demand for the Company's products; customer-specific demand; market opportunity; anticipated industry trends; the availability, benefits, and speed of customer acceptance or implementation of new products and technologies; manufacturing, processing, and design capacity, goals, expansion, volumes, and progress; difficulties or delays in research and development; industry seasonality; risks to the Company's realization of benefits from acquisitions; reliance on customers or third parties (including suppliers); changes in macro-economic environments; events affecting global and regional economic and market conditions and stability such as tariffs, military conflicts, political volatility, infectious diseases and pandemics, and similar factors, operating separately or in combination; and other factors, including those set forth in the Company's most current annual report on Form 10-K, quarterly reports on Form 10-Q and other filings by the Company with the U.S. Securities and Exchange Commission. In addition, there are varying barriers to international trade, including restrictive trade and export regulations such as the US-China restrictions, dynamic tariffs, trade disputes between the U.S. and other countries, and national security developments or tensions, that may substantially restrict or condition our sales to or in certain countries, increase the cost of doing business internationally, and disrupt our supply chain. No assurances can be given that any of the events anticipated by the forward-looking statements within this press release will transpire or occur, or if any of them do so, what impact they will have on the results of operations or financial condition of the Company. Unless required by law, the Company is under no obligation (and expressly disclaims any such obligation) to update or revise its forward-looking statements whether as a result of new information, future events, or otherwise.


FORMFACTOR, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (In thousands, except per share amounts) (Unaudited)

	Three Months Ended									Nine Months Ended
	September 27, 2025			June 28, 2025			September 28, 2024			September 27, 2025		September 28, 2024
Revenues	$	202,676		$	195,798		$	207,917		$	569,830	$	574,116
Cost of revenues		122,050			122,860			123,212			351,743		339,773
Gross profit		80,626			72,938			84,705			218,087		234,343
Operating expenses:
Research and development		28,686			28,793			31,243			85,279		91,434
Selling, general and administrative		32,971			31,482			35,607			97,907		106,560
Factory start-up costs		964			357			—			1,321		—
Total operating expenses		62,621			60,632			66,850			184,507		197,994
Gain on sale of business		—			—			—			—		20,581
Operating income		18,005			12,306			17,855			33,580		56,930
Interest income, net		1,976			2,642			3,650			7,935		10,221
Other income (expense), net		444			(6	)		(558	)		1,328		322
Income before income taxes and equity investment		20,425			14,942			20,947			42,843		67,473
Provision for income taxes		5,937			2,372			2,211			9,384		7,564
Loss (income) from equity investment		(1,168	)		3,484			—			2,316		—
Net income	$	15,656		$	9,086		$	18,736		$	31,143	$	59,909
Net income per share:
Basic	$	0.20		$	0.12		$	0.24		$	0.40	$	0.77
Diluted	$	0.20		$	0.12		$	0.24		$	0.40	$	0.76
Weighted-average number of shares used in per share calculations:
Basic		77,387			77,107			77,406			77,270		77,364
Diluted		77,734			77,527			78,439			77,684		78,495

FORMFACTOR, INC. NON-GAAP FINANCIAL MEASURE RECONCILIATIONS (In thousands, except per share amounts) (Unaudited)

	Three Months Ended									Nine Months Ended
	September 27, 2025			June 28, 2025			September 28, 2024			September 27, 2025			September 28, 2024
GAAP Gross Profit	$	80,626		$	72,938		$	84,705		$	218,087		$	234,343
Adjustments:
Amortization of intangibles and fixed asset fair value adjustments due to acquisitions		490			528			530			1,560			1,661
Stock-based compensation		1,941			1,690			1,934			5,636			5,794
Restructuring charges		116			183			524			359			607
Non-GAAP Gross Profit	$	83,173		$	75,339		$	87,693		$	225,642		$	242,405

GAAP Gross Margin		39.8	%		37.3	%		40.7	%		38.3	%		40.8	%
Adjustments:
Amortization of intangibles and fixed asset fair value adjustments due to acquisitions		0.2	%		0.3	%		0.3	%		0.3	%		0.3	%
Stock-based compensation		0.9	%		0.8	%		0.9	%		0.9	%		1.0	%
Restructuring charges		0.1	%		0.1	%		0.3	%		0.1	%		0.1	%
Non-GAAP Gross Margin		41.0	%		38.5	%		42.2	%		39.6	%		42.2	%

GAAP operating expenses	$	62,621		$	60,632		$	66,850		$	184,507		$	197,994
Adjustments:
Amortization of intangibles		(191	)		(191	)		(191	)		(573	)		(573	)
Stock-based compensation		(7,575	)		(7,701	)		(7,002	)		(23,067	)		(23,756	)
Restructuring charges		(273	)		(195	)		(298	)		(3,291	)		(396	)
Costs related to sale and acquisition of businesses		—			(55	)		(13	)		(272	)		(702	)
Non-GAAP operating expenses	$	54,582		$	52,490		$	59,346		$	157,304		$	172,567

GAAP operating income	$	18,005		$	12,306		$	17,855		$	33,580		$	56,930
Adjustments:
Amortization of intangibles and fixed asset fair value adjustments due to acquisitions		681			719			721			2,133			2,234
Stock-based compensation		9,516			9,391			8,936			28,703			29,550
Restructuring charges		389			378			822			3,650			1,003
Gain on sale of business, net of costs and acquisition related expenses		—			55			13			272			(19,879	)
Non-GAAP operating income	$	28,591		$	22,849		$	28,347		$	68,338		$	69,838

FORMFACTOR, INC. NON-GAAP FINANCIAL MEASURE RECONCILIATIONS (In thousands, except per share amounts) (Unaudited)

	Three Months Ended									Nine Months Ended
	September 27, 2025			June 28, 2025			September 28, 2024			September 27, 2025			September 28, 2024
GAAP net income	$	15,656		$	9,086		$	18,736		$	31,143		$	59,909
Adjustments:
Amortization of intangibles and fixed asset fair value adjustments due to acquisitions		681			719			721			2,133			2,234
Stock-based compensation		9,516			9,391			8,936			28,703			29,550
Restructuring charges		389			378			822			3,650			1,003
Gain on sale of business and assets, net of costs and acquisition related expenses		91			3,460			13			3,768			(19,879	)
Income tax effect of non-GAAP adjustments		(649	)		(1,812	)		(2,002	)		(4,487	)		(3,924	)
Non-GAAP net income	$	25,684		$	21,222		$	27,226		$	64,910		$	68,893

GAAP net income per share:
Basic	$	0.20		$	0.12		$	0.24		$	0.40		$	0.77
Diluted	$	0.20		$	0.12		$	0.24		$	0.40		$	0.76

Non-GAAP net income per share:
Basic	$	0.33		$	0.28		$	0.35		$	0.84		$	0.89
Diluted	$	0.33		$	0.27		$	0.35		$	0.84		$	0.88

GAAP net cash provided by operating activities	$	26,991		$	18,893		$	26,731		$	69,423		$	81,621
Adjustments:
Sale of business and acquisition related payments in working capital		83			168			2,134			1,472			2,811
Cash paid for interest		89			95			97			276			298
Capital expenditures		(7,505	)		(66,256	)		(8,939	)		(92,345	)		(30,773	)
Free cash flow	$	19,658		$	(47,100	)	$	20,023		$	(21,174	)	$	53,957

GAAP net cash provided by (used in) investing activities	$	6,718		$	(78,553	)	$	(16,192	)	$	(156,495	)	$	(26,152	)
GAAP net cash used in financing activities	$	(2,382	)	$	(4,214	)	$	(26,830	)	$	(9,560	)	$	(46,256	)

FORMFACTOR, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited)

	Nine Months Ended
	September 27, 2025			September 28, 2024
Cash flows from operating activities:
Net income	$	31,143		$	59,909
Selected adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		28,161			24,117
Stock-based compensation expense		28,703			29,550
Provision for excess and obsolete inventories		9,922			10,052
Loss from equity investment		2,316			—
Gain on sale of business and assets		(103	)		(20,581	)
Non-cash restructuring charges		2,119			—
Other activity impacting operating cash flows		(32,838	)		(21,426	)
Net cash provided by operating activities		69,423			81,621
Cash flows from investing activities:
Acquisition of property, plant and equipment		(92,345	)		(30,773	)
Proceeds from sale of business and assets		103			21,585
Purchase of equity investment		(67,156	)		—
Proceeds from (purchases of) marketable securities, net		2,903			(15,464	)
Purchase of promissory note receivable		—			(1,500	)
Net cash used in investing activities		(156,495	)		(26,152	)
Cash flows from financing activities:
Purchase of common stock through stock repurchase program, including excise tax paid		(26,244	)		(37,211	)
Proceeds from issuances of common stock		26,119			9,748
Principal repayments on term loans		(826	)		(803	)
Tax withholdings related to net share settlements of equity awards		(8,609	)		(17,990	)
Net cash used in financing activities		(9,560	)		(46,256	)
Effect of exchange rate changes on cash, cash equivalents and restricted cash		537			3
Net increase (decrease) in cash, cash equivalents and restricted cash		(96,095	)		9,216
Cash, cash equivalents and restricted cash, beginning of period		197,206			181,273
Cash, cash equivalents and restricted cash, end of period	$	101,111		$	190,489

FORMFACTOR, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) (Unaudited)

	September 27, 2025		June 28, 2025		December 28, 2024
ASSETS
Current assets:
Cash and cash equivalents	$	97,678	$	67,380	$	190,728
Marketable securities		168,351		181,949		169,295
Accounts receivable, net of allowance for credit losses		133,316		115,199		104,294
Inventories, net		108,830		110,789		101,676
Restricted cash		1,058		1,061		3,746
Prepaid expenses and other current assets		50,027		48,884		35,389
Total current assets		559,260		525,262		605,128
Restricted cash		2,375		2,464		2,732
Operating lease, right-of-use-assets		17,471		19,475		22,579
Property, plant and equipment, net of accumulated depreciation		257,912		259,288		210,230
Equity investment		66,441		67,264		—
Goodwill		200,841		200,858		199,171
Intangibles, net		8,385		9,017		10,355
Deferred tax assets		88,265		94,795		92,012
Other assets		2,042		3,185		4,008
Total assets	$	1,202,992	$	1,181,608	$	1,146,215

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	58,389	$	59,932	$	62,287
Accrued liabilities		41,574		38,545		43,742
Current portion of long-term debt, net of unamortized issuance costs		1,129		1,121		1,106
Deferred revenue		21,623		16,450		15,847
Operating lease liabilities		7,400		7,919		8,363
Total current liabilities		130,115		123,967		131,345
Long-term debt, less current portion, net of unamortized issuance costs		11,359		11,644		12,208
Long-term operating lease liabilities		13,317		15,231		17,550
Deferred grant		18,000		18,000		18,000
Other liabilities		20,586		22,743		19,344
Total liabilities		193,377		191,585		198,447

Stockholders' equity:
Common stock		78		77		77
Additional paid-in capital		857,401		850,064		837,586
Accumulated other comprehensive income (loss)		48		3,450		(10,840	)
Accumulated income		152,088		136,432		120,945
Total stockholders' equity		1,009,615		990,023		947,768
Total liabilities and stockholders' equity	$	1,202,992	$	1,181,608	$	1,146,215

About our Non-GAAP Financial Measures:

We believe that the presentation of non-GAAP net income, non-GAAP net income per basic and diluted share, non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating income and free cash flow provides supplemental information that is important to understanding financial and business trends and other factors relating to our financial condition and results of operations. Non-GAAP net income, non-GAAP net income per basic and diluted share, non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, and non-GAAP operating income are among the primary indicators used by management as a basis for planning and forecasting future periods, and by management and our board of directors to determine whether our operating performance has met certain targets and thresholds. Management uses non-GAAP net income, non-GAAP net income per basic and diluted share, non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, and non-GAAP operating income when evaluating operating performance because it believes that the exclusion of the items indicated herein, for which the amounts or timing may vary significantly depending upon our activities and other factors, facilitates comparability of our operating performance from period to period. We use free cash flow to conduct and evaluate our business as an additional way of viewing our liquidity that, when viewed with our GAAP results, provides a more complete understanding of factors and trends affecting our cash flows. Many investors also prefer to track free cash flow, as opposed to only GAAP earnings. Free cash flow has limitations due to the fact that it does not represent the residual cash flow available for discretionary expenditures, and therefore it is important to view free cash flow as a complement to our entire consolidated statements of cash flows. We have chosen to provide this non-GAAP information to investors so they can analyze our operating results closer to the way that management does, and use this information in their assessment of our business and the valuation of our Company. We compute non-GAAP net income, non-GAAP net income per basic and diluted share, non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, and non-GAAP operating income, by adjusting GAAP net income, GAAP net income per basic and diluted share, GAAP gross profit, GAAP gross margin, GAAP operating expenses, and GAAP operating income to remove the impact of certain items and the tax effect, if applicable, of those adjustments. These non-GAAP measures are not in accordance with, or an alternative to, GAAP, and may be materially different from other non-GAAP measures, including similarly titled non-GAAP measures used by other companies. The presentation of this additional information should not be considered in isolation from, as a substitute for, or superior to, net income, net income per basic and diluted share, gross profit, gross margin, operating expenses, or operating income in accordance with GAAP. Non-GAAP financial measures have limitations in that they do not reflect certain items that may have a material impact upon our reported financial results. We may expect to continue to incur expenses of a nature similar to the non-GAAP adjustments described above, and exclusion of these items from our non-GAAP net income, non-GAAP net income per basic and diluted share, non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, and non-GAAP operating income should not be construed as an inference that these costs are unusual, infrequent or non-recurring. For more information on the non-GAAP adjustments, please see the table captioned "Non-GAAP Financial Measure Reconciliations" included in this press release.

Investor Contact:

Stan Finkelstein

Investor Relations

(925) 290-4273

ir@formfactor.com

Source: FormFactor, Inc.

FORM-F

FormFactor, Inc. Reports 2025 Third Quarter Results