Monolithic Power Systems Reports Second Quarter Results on July 30, 2026
Rhea-AI Summary
Monolithic Power Systems (NASDAQ: MPWR) reported record Q2 2026 revenue of $980.6 million, up 21.9% QoQ and 47.6% YoY. GAAP net income was $257.3 million with diluted EPS of $5.22, while non-GAAP net income reached $320.1 million and EPS $6.50. GAAP gross margin was 55.2% and non-GAAP gross margin 55.6%.
Enterprise Data revenue grew to $380.6 million (38.8% of total), up 44.8% QoQ and 164.3% YoY, with all end markets rising sequentially. Operating cash flow was $227.9 million; cash, equivalents and short-term investments were $1.41 billion. For Q3 2026, MPS forecasts revenue of $1.14–$1.16 billion, GAAP gross margin of 55.2%–55.8% and non-GAAP gross margin of 55.4%–56.0%. The board also increased the stock repurchase authorization by $500 million, bringing total authorization to $1 billion.
Positive
- Revenue $980.6M, up 21.9% QoQ and 47.6% YoY in Q2 2026
- Non-GAAP EPS $6.50, up 27.5% QoQ and 54.4% YoY
- Enterprise Data revenue $380.6M, up 44.8% QoQ and 164.3% YoY
- Non-GAAP operating margin 37.5%, up 1.7 pts QoQ and 2.7 pts YoY
- Q3 2026 revenue guidance $1.14–$1.16B with gross margin ranges disclosed
- Share repurchase authorization increased by $500M to a total of $1B
Negative
- Consumer revenue $56.8M, down 4.8% YoY despite 4.2% QoQ growth
- Automotive mix declined to 16.0% of revenue from 18.9% in Q1 2026
- GAAP operating expenses $237.2M, up 16.3% QoQ and 17.8% YoY
- Operating cash flow $227.9M, down from $250.3M in Q1 2026
- Internal inventories $675.8M, higher than $619.2M in Q1 2026
- Stock-based compensation and related expenses $53.5M in Q2 2026
Market reaction after Q2 2026 earnings report: MPWR +10.27%
Following this news, MPWR has gained 10.27%, reflecting a significant positive market reaction. Our momentum scanner has triggered 17 alerts so far, indicating notable trading interest and price volatility. The stock is currently trading at $1451.39. Trading volume is above average at 1.9x the average, suggesting increased trading activity.
Data tracked by StockTitan Argus (15 min delayed). Upgrade to Gold for real-time data.
Key Figures
Previous Earnings Reports
| Date | Event | Sentiment | 24h Move | Catalyst |
|---|---|---|---|---|
| Apr 30 | Q1 earnings results | Positive | -1.9% | Revenue and earnings increased, but the stock declined 1.92% over 24 hours. |
| Oct 30 | Q3 earnings results | Positive | -7.6% | Quarterly results and Q4 guidance were reported as the stock declined 7.59%. |
| Jul 31 | Q2 earnings results | Positive | +10.5% | Record quarterly revenue and Q3 guidance accompanied a 10.46% stock increase. |
| May 01 | Q1 earnings results | Positive | +5.9% | Revenue growth, earnings, and Q2 guidance accompanied a 5.86% stock increase. |
| May 01 | Q1 earnings results | Positive | +5.9% | Quarterly revenue growth and Q2 guidance accompanied a 5.86% stock increase. |
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
Tag-specific earnings history showed both positive and negative reactions, with three aligned events and two divergences.
Key Terms
gaap financial
non-gaap financial
diluted eps financial
ddr5 technical
adas technical
AI-generated analysis. How Rhea-AI works. Not financial advice.
SCHAFFHAUSEN, Switzerland, July 30, 2026 (GLOBE NEWSWIRE) -- Monolithic Power Systems, Inc. (“MPS”) reported its results after market close on July 30, 2026 and will host a question-and-answer webinar at 2:00 p.m. PT / 5:00 p.m. ET. The webinar can be accessed from the Investor Relations section of the MPS website at www.monolithicpower.com.
| Q2 2026 Financial Summary | (Unaudited) |
| GAAP | |||||||||||||||||
| Q2'26 | Q1'26 | Q2'25 | QoQ Change | YoY Change | |||||||||||||
| Revenue ($M) | $ | 980.6 | $ | 804.2 | $ | 664.6 | 21.9 | % | 47.6 | % | |||||||
| Gross Margin | 55.2 | % | 55.3 | % | 55.1 | % | (0.1) pts | 0.1 pts | |||||||||
| Opex ($M) | $ | 237.2 | $ | 203.9 | $ | 201.3 | 16.3 | % | 17.8 | % | |||||||
| Operating Margin | 31.0 | % | 30.0 | % | 24.8 | % | 1.0 pts | 6.2 pts | |||||||||
| Net income ($M) | $ | 257.3 | $ | 193.2 | $ | 135.0 | 33.2 | % | 90.6 | % | |||||||
| Diluted EPS | $ | 5.22 | $ | 3.92 | $ | 2.81 | 33.2 | % | 85.8 | % | |||||||
| Non-GAAP | |||||||||||||||||
| Q2'26 | Q1'26 | Q2'25 | QoQ Change | YoY Change | |||||||||||||
| Revenue ($M) | $ | 980.6 | $ | 804.2 | $ | 664.6 | 21.9 | % | 47.6 | % | |||||||
| Gross Margin | 55.6 | % | 55.5 | % | 55.5 | % | 0.1 pts | 0.1 pts | |||||||||
| Opex ($M) | $ | 177.6 | $ | 158.3 | $ | 137.6 | 12.1 | % | 29.1 | % | |||||||
| Operating Margin | 37.5 | % | 35.8 | % | 34.8 | % | 1.7 pts | 2.7 pts | |||||||||
| Net income ($M) | $ | 320.1 | $ | 251.3 | $ | 202.2 | 27.4 | % | 58.3 | % | |||||||
| Diluted EPS | $ | 6.50 | $ | 5.10 | $ | 4.21 | 27.5 | % | 54.4 | % | |||||||
| Tax Rate | 15.0 | % | 15.0 | % | 15.0 | % | Flat | Flat | |||||||||
| Revenue by End Market | |||||||||||||||||||||
| Revenue | % Change | % of Revenue | |||||||||||||||||||
| End Market ($M) | Q2'26 | Q1'26 | Q2'25 | QoQ | YoY | Q2'26 | Q1'26 | ||||||||||||||
| Enterprise Data | $ | 380.6 | $ | 262.8 | $ | 144.0 | 44.8 | % | 164.3 | % | 38.8 | % | 32.7 | % | |||||||
| Storage & Computing | 199.8 | 174.4 | 195.3 | 14.6 | % | 2.3 | % | 20.4 | 21.7 | ||||||||||||
| Automotive | 157.1 | 152.4 | 145.1 | 3.1 | % | 8.2 | % | 16.0 | 18.9 | ||||||||||||
| Communications | 131.5 | 111.5 | 73.8 | 18.0 | % | 78.3 | % | 13.4 | 13.9 | ||||||||||||
| Consumer | 56.8 | 54.5 | 59.7 | 4.2 | % | (4.8 | %) | 5.8 | 6.8 | ||||||||||||
| Industrial | 54.8 | 48.6 | 46.7 | 12.7 | % | 17.3 | % | 5.6 | 6.0 | ||||||||||||
| Total | $ | 980.6 | $ | 804.2 | $ | 664.6 | 21.9 | % | 47.6 | % | 100 | % | 100 | % | |||||||
Ongoing Business Conditions
In the second quarter of 2026, MPS achieved record quarterly revenue of
Our quarterly performance was the result of our continued innovation, our consistent execution and the resilience of our diversified market and supply chain strategy.
Q2 2026 highlights include:
- All end markets grew sequentially with Enterprise Data growing
45% as we continued to see strong, broad-based ordering patterns. - We extended our capacity goal significantly beyond
$6B to support future revenue growth and our transformation into a full solution provider. - We received initial orders for high-speed DDR5 memory components which we expect to grow our SAM into next year.
- We began sampling High Voltage AC to DC products for 800V data center architectures as we expand beyond our current AI and server core power solutions.
- In our Automotive market, so far this year, we have shipped products for over 1500 new sockets as we increase our footprint in both ADAS and other applications within the vehicle.
We continue to adjust to the fluid geopolitical and macro-economic environment, but our diversified market strategy remains unchanged:
- MPS focuses on innovation and solving our customers’ most challenging problems.
- We consistently invest in new technologies that open new end markets and applications.
- We continuously expand and diversify our global supply chain allowing us to capture future growth opportunities, maintain supply stability, and rapidly adapt to market changes as they occur.
“Our results demonstrate the strength of our diversified model and our continued success in transforming from a chip-only, semiconductor supplier to a full service solutions provider,” said Michael Hsing, CEO and founder of MPS.
Q2 2026 Revenue Results
MPS reported second quarter revenue of
In our Enterprise Data market, second quarter 2026 revenue of
Second quarter 2026 Communications revenue of
Second quarter 2026 Storage and Computing revenue of
Second quarter 2026 Industrial revenue of
Second quarter 2026 Consumer revenue of
Second quarter Automotive revenue of
Q2 2026 Gross Margin & Operating Income
GAAP gross margin was
Non-GAAP gross margin for the second quarter of 2026 was
Q2 2026 Operating Expenses
GAAP operating expenses were
The differences between non-GAAP operating expenses and GAAP operating expenses for the quarters discussed here are primarily stock-based compensation and related expenses and deferred compensation plan expense.
Total stock-based compensation and related expenses, including approximately
The Bottom Line
Second quarter 2026 GAAP net income was
Second quarter 2026 non-GAAP net income was
Second quarter 2026 non-GAAP tax rate of
There were 49.3 million fully diluted shares outstanding at the end of the second quarter of 2026.
Balance Sheet and Cash Flow
Cash, cash equivalents and short-term investments were
Accounts receivable at the end of the second quarter of 2026 were
Our internal inventories at the end of the second quarter of 2026 were
Comparing current inventory levels using next quarter’s projected revenue, days of inventory at the end of the second quarter of 121 days was 7 days lower than at the end of the first quarter of 2026.
| Selected Balance Sheet and Inventory Data | (Unaudited) | ||||
| Q2'26 | Q1'26 | Q2'25 | |||
| Cash, Cash Equivalents, and Short-Term Investments | |||||
| Operating Cash Flow | |||||
| Accounts Receivable | |||||
| Days of Sales Outstanding | 32 Days | 34 Days | 27 Days | ||
| Internal Inventories | |||||
| Days of Inventory (current quarter revenue) | 140 Days | 157 Days | 150 Days | ||
| Days of Inventory (next quarter revenue) | 121 Days | 128 Days | 135 Days | ||
Q3 2026 Business Outlook
For the third quarter of 2026 ending September 30, we are forecasting:
- Revenue in the range of
$1,140 million to$1,160 million . - GAAP gross margin in the range of
55.2% to55.8% . - Non-GAAP gross margin in the range of
55.4% to56.0% , which excludes the impact from stock-based compensation and related expenses as well as the impact from amortization of acquisition-related intangible assets. - Total stock-based compensation and related expenses in the range of
$53.2 million to$55.2 million including approximately$1.7 million that would be charged to cost of goods sold. - GAAP operating expenses between
$252.7 million and$258.7 million . - Non-GAAP operating expenses in the range of
$201.2 million to$205.2 million . This estimate excludes stock-based compensation and related expenses in the range of$51.5 million to$53.5 million . - Interest and other income in the range from
$7.8 million to$8.2 million before foreign exchange gains or losses. - Non-GAAP tax rate of
15% for 2026. - Fully diluted shares outstanding in the range of 49.1 to 49.5 million shares.
In addition, our Board of Directors has authorized an additional
For further information, contact:
Tony Balow
Vice President, Finance
Monolithic Power Systems, Inc.
MPSInvestor.Relations@monolithicpower.com
Safe Harbor Statement
This earnings commentary contains, and statements that will be made during the accompanying webinar will contain, forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995, that should not be unduly relied upon, including under the “Q3 2026 Business Outlook” section herein, our statement regarding our business focus, our statement regarding our capacity growth goal, our statement regarding our expected shipments for the Automotive end market, our statement regarding our expected expansion of our SAM for high-speed DDR5 memory components, our statement regarding the expansion and diversification of our supply chain to allow us to capture future growth opportunities, maintain supply stability and swiftly adapt to market changes as they occur, and our statement regarding the major customer sampling of our first high speed interface products for DDR5, including, among other things, (i) projected revenue, GAAP and non-GAAP gross margin, GAAP and non-GAAP operating expenses, stock-based compensation and related expenses, amortization of acquisition-related intangible assets, other income before foreign exchange gains or losses, and fully diluted shares outstanding, (ii) our outlook for the third quarter of fiscal year 2026 and the near-term, medium-term and long-term prospects of MPS, including our ability to adapt to changing market conditions, performance against our business plan, our ability to grow despite the various challenges facing our business, our industry and the global economic environment, potential new business segments, our continued investment in research and development (“R&D”), expected revenue growth, customers’ acceptance of our new product offerings, the prospects of our new product development, our expectations regarding market and industry trends and prospects, and our goal to expand our capacity and the impact it may have on our business, (iii) our ability to penetrate new markets and expand our market share, (iv) our ability to reduce our expenses, and (vi) statements regarding the assumptions underlying or relating to any statement described above. These forward-looking statements are not historical facts or guarantees of future performance or events, are based on current expectations, estimates, beliefs, assumptions, goals, and objectives, and involve significant known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from the results expressed by these statements. Readers of this earnings commentary and listeners to the accompanying conference call are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date hereof. Factors that could cause actual results to differ include, but are not limited to, continued uncertainties in the global economy, including due to current and potential global conflicts, global tariffs, export controls and retaliatory measures and announcements regarding same, inflation, consumer sentiment and other factors; adverse events arising from orders or regulations of governmental entities, including such orders or regulations that impact our customers or suppliers, and adoption of new or amended accounting standards; adverse changes in laws and government regulations such as tariffs on imports of foreign goods, export regulations and export classifications, and tax laws or the interpretation of same, including in foreign countries where MPS has offices or operations; the effect of export controls, trade and economic sanctions regulations and other regulatory or contractual limitations on our ability to sell or develop our products in certain foreign markets, particularly in China; our ability to obtain governmental licenses and approvals for international trading activities or technology transfers, including export licenses; acceptance of, or demand for, our products, in particular the new products launched recently, being different than expected; our ability to increase market share in our targeted markets; difficulty in predicting or budgeting for future customer demand and channel inventories, expenses and financial contingencies (including as a result of any impact from current and potential global conflicts); our ability to efficiently and effectively develop new products and receive a return on our R&D expense investment; our ability to attract new customers and retain existing customers; our ability to meet customer demand for our products due to constraints on our third-party suppliers’ ability to manufacture sufficient quantities of our products or otherwise; our ability to expand manufacturing capacity to support future growth; adverse changes in production and testing efficiency of our products; any political, cultural, military, regulatory, economic, foreign exchange and operational changes in China, where a significant portion of our manufacturing capacity comes from; any market disruptions or interruptions in our schedule of new product development releases; our ability to manage our inventory levels; adequate supply of our products from our third-party manufacturing partners; adverse changes or developments in the semiconductor industry generally, which is cyclical in nature, and our ability to adjust our operations to address such changes or developments; the ongoing consolidation of companies in the semiconductor industry; competition generally and the increasingly competitive nature of our industry; our ability to realize the anticipated benefits of companies and products that MPS acquires, and our ability to effectively and efficiently integrate these acquired companies and products into our operations; the risks, uncertainties and costs of litigation in which MPS is involved; the outcome of any upcoming trials, hearings, motions and appeals; the adverse impact on our financial performance if its tax and litigation provisions are inadequate; our ability to effectively manage our growth and attract and retain qualified personnel; the effect of epidemics and pandemics on the global economy and on our business; the risks associated with the financial market, economy, global tariffs, export controls and retaliatory measures and announcements regarding same, and geopolitical uncertainties, including current and potential global conflicts; the Company’s ability to timely and adequately remediate its material weakness; and other important risk factors identified under the caption “Risk Factors” and elsewhere in our Securities and Exchange Commission (“SEC”) filings, including, but not limited to, our Annual Report on Form 10-K filed with the SEC on February 27, 2026. MPS assumes no obligation to update the information in this earnings commentary or in the accompanying webinar.
Non-GAAP Financial Measures
This earnings commentary contains references to certain non-GAAP financial measures. Non-GAAP net income, non-GAAP net income per share, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating income, non-GAAP other income, net, and non-GAAP income before income taxes differ from net income, net income per share, gross margin, operating expenses, operating income, other income, net, and income before income taxes determined in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). Non-GAAP net income and non-GAAP net income per share exclude the effect of stock-based compensation and related expenses, which include stock-based compensation expense and employer payroll taxes in relation to the stock-based compensation, amortization of acquisition-related intangible assets, net deferred compensation plan expense, and related tax effects. Non-GAAP gross margin excludes the effect of stock-based compensation and related expenses, amortization of acquisition-related intangible assets and deferred compensation plan expense. Non-GAAP operating expenses exclude the effect of stock-based compensation and related expenses, amortization of acquisition-related intangible assets and deferred compensation plan expense. Non-GAAP operating income excludes the effect of stock-based compensation and related expenses, amortization of acquisition-related intangible assets and deferred compensation plan expense. Non-GAAP other income, net excludes the effect of deferred compensation plan income. Non-GAAP income before income taxes excludes the effect of stock-based compensation and related expenses, amortization of acquisition-related intangible assets and net deferred compensation plan expense. Projected non-GAAP gross margin excludes the effect of stock-based compensation and related expenses, and amortization of acquisition-related intangible assets. Projected non-GAAP operating expenses exclude the effect of stock-based compensation and related expenses. These non-GAAP financial measures are not prepared in accordance with GAAP and should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. MPS utilizes both GAAP and non-GAAP financial measures to assess what it believes to be its core operating performance and to evaluate and manage its internal business and assist in making financial operating decisions. MPS believes that the inclusion of non-GAAP financial measures, together with GAAP measures, provides investors with an alternative presentation useful to investors’ understanding of MPS’s core operating results and trends. Additionally, MPS believes that the inclusion of non-GAAP measures, together with GAAP measures, provides investors with an additional dimension of comparability to similar companies. However, investors should be aware that non-GAAP financial measures utilized by other companies are not likely to be comparable in most cases to the non-GAAP financial measures used by MPS. See the GAAP to Non-GAAP reconciliations in the tables set forth below.
About Monolithic Power Systems
MPS is a fabless global company that provides high-performance, semiconductor-based power electronics solutions. MPS’s mission is to reduce energy and material consumption to improve all aspects of quality of life and create a sustainable future. Founded in 1997 by our CEO Michael Hsing, MPS has three core strengths: deep system-level knowledge, strong semiconductor design expertise, and innovative proprietary technologies in the areas of semiconductor processes, system integration, and packaging. These combined advantages enable MPS to deliver reliable, compact, and monolithic solutions that are highly energy-efficient, cost-effective, and environmentally responsible while providing a consistent return on investment to our stockholders. MPS can be contacted through its website at www.monolithicpower.com or its support offices around the world.
Monolithic Power Systems, MPS, and the MPS logo are registered trademarks of Monolithic Power Systems, Inc. in the U.S. and trademarked in certain other countries.
| Monolithic Power Systems, Inc. Condensed Consolidated Balance Sheets (Unaudited, in thousands, except par value) | ||||||
| June 30, | December 31, | |||||
| 2026 | 2025 | |||||
| ASSETS | ||||||
| Current assets: | ||||||
| Cash and cash equivalents | $ | 1,005,587 | $ | 1,099,302 | ||
| Short-term investments | 408,174 | 157,243 | ||||
| Accounts receivable, net | 343,620 | 255,626 | ||||
| Inventories | 675,849 | 564,649 | ||||
| Other current assets | 44,156 | 106,982 | ||||
| Total current assets | 2,477,386 | 2,183,802 | ||||
| Property and equipment, net | 774,549 | 627,689 | ||||
| Acquisition-related intangible assets, net | 8,216 | 8,790 | ||||
| Goodwill | 25,944 | 25,944 | ||||
| Deferred tax assets, net | 1,182,833 | 1,182,883 | ||||
| Other long-term assets | 217,279 | 165,091 | ||||
| Total assets | $ | 4,686,207 | $ | 4,194,199 | ||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||
| Current liabilities: | ||||||
| Accounts payable | $ | 182,224 | $ | 138,272 | ||
| Accrued compensation and related benefits | 93,635 | 85,963 | ||||
| Other accrued liabilities | 222,075 | 145,130 | ||||
| Total current liabilities | 497,934 | 369,365 | ||||
| Income tax liabilities | 75,022 | 75,022 | ||||
| Deferred tax liabilities | 90,316 | 90,480 | ||||
| Other long-term liabilities | 127,511 | 127,835 | ||||
| Total liabilities | 790,783 | 662,702 | ||||
| Commitments and contingencies | ||||||
| Stockholders’ equity: | ||||||
| Common stock and additional paid-in capital: | 1,033,062 | 936,998 | ||||
| Retained earnings | 2,861,853 | 2,609,651 | ||||
| Accumulated other comprehensive income (loss) | 509 | (15,152 | ) | |||
| Total stockholders’ equity | 3,895,424 | 3,531,497 | ||||
| Total liabilities and stockholders’ equity | $ | 4,686,207 | $ | 4,194,199 | ||
| Monolithic Power Systems, Inc. Condensed Consolidated Statements of Operations (Unaudited, in thousands, except per share amounts) | |||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||
| Revenue | $ | 980,642 | $ | 664,574 | $ | 1,784,827 | $ | 1,302,128 | |||
| Cost of revenue | 439,572 | 298,558 | 798,692 | 582,882 | |||||||
| Gross profit | 541,070 | 366,016 | 986,135 | 719,246 | |||||||
| Operating expenses: | |||||||||||
| Research and development | 118,618 | 96,266 | 219,184 | 188,493 | |||||||
| Selling, general and administrative | 118,558 | 104,992 | 221,905 | 197,236 | |||||||
| Total operating expenses | 237,176 | 201,258 | 441,089 | 385,729 | |||||||
| Operating income | 303,894 | 164,758 | 545,046 | 333,517 | |||||||
| Other income, net | 17,835 | 12,220 | 23,865 | 17,351 | |||||||
| Income before income taxes | 321,729 | 176,978 | 568,911 | 350,868 | |||||||
| Income tax expense | 64,431 | 41,969 | 118,387 | 80,807 | |||||||
| Net income | $ | 257,298 | $ | 135,009 | $ | 450,524 | $ | 270,061 | |||
| Net income per share: | |||||||||||
| Basic | $ | 5.24 | $ | 2.82 | $ | 9.17 | $ | 5.64 | |||
| Diluted | $ | 5.22 | $ | 2.81 | $ | 9.15 | $ | 5.62 | |||
| Weighted-average shares outstanding: | |||||||||||
| Basic | 49,138 | 47,887 | 49,118 | 47,869 | |||||||
| Diluted | 49,260 | 48,019 | 49,251 | 48,012 | |||||||
| RECONCILIATION OF NET INCOME TO NON-GAAP NET INCOME (Unaudited, in thousands, except per share amounts) | |||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||
| Net income | $ | 257,298 | $ | 135,009 | $ | 450,524 | $ | 270,061 | |||
| Adjustments to reconcile net income to non-GAAP net income: | |||||||||||
| Stock-based compensation and related expenses | 53,549 | 60,280 | 102,087 | 114,091 | |||||||
| Amortization of acquisition-related intangible assets | 320 | 320 | 640 | 640 | |||||||
| Deferred compensation plan expense, net | 963 | 281 | 585 | 275 | |||||||
| Tax effect | 7,948 | 6,290 | 17,554 | 10,926 | |||||||
| Non-GAAP net income | $ | 320,078 | $ | 202,180 | $ | 571,390 | $ | 395,993 | |||
| Non-GAAP net income per share: | |||||||||||
| Basic | $ | 6.51 | $ | 4.22 | $ | 11.63 | $ | 8.27 | |||
| Diluted | $ | 6.50 | $ | 4.21 | $ | 11.60 | $ | 8.25 | |||
| Shares used in the calculation of non-GAAP net income per share: | |||||||||||
| Basic | 49,138 | 47,887 | 49,118 | 47,869 | |||||||
| Diluted | 49,260 | 48,019 | 49,251 | 48,012 | |||||||
| RECONCILIATION OF GROSS MARGIN TO NON-GAAP GROSS MARGIN (Unaudited, in thousands) | |||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||
| Gross profit | $ | 541,070 | $ | 366,016 | $ | 986,135 | $ | 719,246 | |||||||
| Gross margin | 55.2 | % | 55.1 | % | 55.3 | % | 55.2 | % | |||||||
| Adjustments to reconcile gross profit to non-GAAP gross profit: | |||||||||||||||
| Stock-based compensation and related expenses | 1,767 | 1,915 | 3,449 | 3,621 | |||||||||||
| Amortization of acquisition-related intangible assets | 287 | 287 | 574 | 574 | |||||||||||
| Deferred compensation plan expense | 2,113 | 605 | 1,470 | 442 | |||||||||||
| Non-GAAP gross profit | $ | 545,237 | $ | 368,823 | $ | 991,628 | $ | 723,883 | |||||||
| Non-GAAP gross margin | 55.6 | % | 55.5 | % | 55.6 | % | 55.6 | % | |||||||
RECONCILIATION OF OPERATING EXPENSES TO NON-GAAP OPERATING EXPENSES
(Unaudited, in thousands)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||
| Total operating expenses | $ | 237,176 | $ | 201,258 | $ | 441,089 | $ | 385,729 | |||||||
| Adjustments to reconcile total operating expenses to non-GAAP total operating expenses: | |||||||||||||||
| Stock-based compensation and related expenses | (51,782 | ) | (58,365 | ) | (98,638 | ) | (110,470 | ) | |||||||
| Amortization of acquisition-related intangible assets | (33 | ) | (33 | ) | (66 | ) | (66 | ) | |||||||
| Deferred compensation plan expense | (7,781 | ) | (5,256 | ) | (6,458 | ) | (4,063 | ) | |||||||
| Non-GAAP operating expenses | $ | 177,580 | $ | 137,604 | $ | 335,927 | $ | 271,130 | |||||||
| RECONCILIATION OF OPERATING INCOME TO NON-GAAP OPERATING INCOME (Unaudited, in thousands) | |||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||
| Total operating income | $ | 303,894 | $ | 164,758 | $ | 545,046 | $ | 333,517 | |||
| Adjustments to reconcile total operating income to non-GAAP total operating income: | |||||||||||
| Stock-based compensation and related expenses | 53,549 | 60,280 | 102,087 | 114,091 | |||||||
| Amortization of acquisition-related intangible assets | 320 | 320 | 640 | 640 | |||||||
| Deferred compensation plan expense | 9,894 | 5,861 | 7,928 | 4,505 | |||||||
| Non-GAAP operating income | $ | 367,657 | $ | 231,219 | $ | 655,701 | $ | 452,753 | |||
| RECONCILIATION OF OTHER INCOME, NET, TO NON-GAAP OTHER INCOME, NET (Unaudited, in thousands) | |||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||
| Total other income, net | $ | 17,835 | $ | 12,220 | $ | 23,865 | $ | 17,351 | |||||||
| Adjustments to reconcile other income, net to non-GAAP other income, net: | |||||||||||||||
| Deferred compensation plan income | (8,931 | ) | (5,580 | ) | (7,343 | ) | (4,230 | ) | |||||||
| Non-GAAP other income, net | $ | 8,904 | $ | 6,640 | $ | 16,522 | $ | 13,121 | |||||||
| RECONCILIATION OF INCOME BEFORE INCOME TAXES TO NON-GAAP INCOME BEFORE INCOME TAXES (Unaudited, in thousands) | |||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||
| Total income before income taxes | $ | 321,729 | $ | 176,978 | $ | 568,911 | $ | 350,868 | |||
| Adjustments to reconcile income before income taxes to non-GAAP income before income taxes: | |||||||||||
| Stock-based compensation and related expenses | 53,549 | 60,280 | 102,087 | 114,091 | |||||||
| Amortization of acquisition-related intangible assets | 320 | 320 | 640 | 640 | |||||||
| Deferred compensation plan expense, net | 963 | 281 | 585 | 275 | |||||||
| Non-GAAP income before income taxes | $ | 376,561 | $ | 237,859 | $ | 672,223 | $ | 465,874 | |||
| 2026 THIRD QUARTER OUTLOOK RECONCILIATION OF GROSS MARGIN TO NON-GAAP GROSS MARGIN (Unaudited) | |||||
| Three Months Ending | |||||
| September 30, 2026 | |||||
| Low | High | ||||
| Gross margin | 55.2 | % | 55.8 | % | |
| Adjustment to reconcile gross margin to non-GAAP gross margin: | |||||
| Stock-based compensation and other expenses | 0.2 | 0.2 | |||
| Non-GAAP gross margin | 55.4 | % | 56.0 | % | |
| RECONCILIATION OF OPERATING EXPENSES TO NON-GAAP OPERATING EXPENSES (Unaudited, in thousands) | |||||||
| Three Months Ending | |||||||
| September 30, 2026 | |||||||
| Low | High | ||||||
| Operating expenses | $ | 252,700 | $ | 258,700 | |||
| Adjustments to reconcile operating expenses to non-GAAP operating expenses: | |||||||
| Stock-based compensation and other expenses | (51,500 | ) | (53,500 | ) | |||
| Non-GAAP operating expenses | $ | 201,200 | $ | 205,200 | |||
