“We are encouraged by the positive momentum we are seeing across the business, including continued strong bookings, increasing backlog and strong design win activity in our strategic focus areas.” (CEO)
“E-Mobility led our automotive sales growth in the first quarter with particular strength in current sensors for xEV applications like high-voltage traction inverters and onboard chargers.” (CEO)
“More than 75% of first quarter wins were in strategic focus areas, including e-Mobility, Data Center, Robotics and Automation, Clean Energy and Medical Applications.” (CEO)
“We continue to see positive forward-looking metrics for the business, including continued strong bookings, in fact, to levels we haven't seen since our fiscal '23.” (CFO)
“Operating income improved by 128% on a 22% sales increase year-over-year, demonstrating the operating leverage in the business model.” (CFO)
Prepared Metrics
Metric
Value
Speaker/Context
Sales
$203M
Q1 FY2026 (CFO)
Gross Margin
48.2%
Q1 FY2026 (CFO)
Operating Margin
11.1%
Q1 FY2026 (CFO)
Adjusted EBITDA %
16.4%
Q1 FY2026 (CFO)
Non-GAAP EPS
$0.09
Q1 FY2026 (CFO)
Free Cash Flow
$51M
Q1 FY2026 (CFO)
CapEx
$11M
Q1 FY2026 (CFO)
Inventory Days
141
Q1 FY2026 (CFO)
Net Debt
$181M
End of Q1 FY2026 (CFO)
Q2 Sales Guidance
$205M–$215M
Non-GAAP midpoint +12% YoY (CFO)
Q2 Gross Margin Guidance
48%–50%
Non-GAAP (CFO)
Q2 Non-GAAP EPS Guidance
$0.10–$0.14
Midpoint +50% YoY (CFO)
Q&A Batch (1-5 of 5)
Q1 — Joseph Michael Quatrochi
Topic: Demand recovery, tariff pull-ins, and industrial exposure
Key points:
Book-to-bill growing with strong bookings, growing backlog, significant orders within lead time, and inventory reductions in distribution channel.
Tariff pull-ins deemed immaterial; Allegro ships ~15% of products into US/North America, all from Philippines.
Industrial SAM is ~$3 billion, growing double-digit, spanning Data Center, Robotics, Factory Automation, clean energy, medical; clean energy has softness but offset by data center strength.
Topic: Gross margin drivers and automotive demand recovery
Key points:
Q1 gross margin 48.2% (20 bps above guidance); revenue ~$1M above range; drop-through ~90% in Q1 due to pricing timing and cost benefits lagging by 1–2 quarters.
September quarter guidance midpoint 49% (48%–50% range), implying ~75% drop-through; post that, 60%–65% drop-through expected.
Auto production forecast revised by S&P from slight decline to flat; expedited delivery requests increasing from auto customers.
Mgmt stance: Neutral-to-bullish on gross margin (utilization leverage, mix upside); bullish on auto recovery (right signs, but not yet strong).
Q3 — Gary Wade Mobley
Topic: Revenue vs. end demand and tariff impact on auto RFQs
Key points:
September quarter revenue guide of $210M not shipping to end demand; end demand estimated at $220M–$230M (based on Q4 '24 sales).
Distribution undershipped in Q1; Q2 sell-in could be flattish as some distributors need select parts, but Europe still has downside.
No tariff-related impact on design RFQ activity; prior delays were due to EV/ICE platform balancing, not tariffs.
Mgmt stance: Cautious on revenue timing (still undershipping); neutral on tariff impact (no program pushouts seen).
Q4 — Nathaniel Quinn Bolton
Topic: Seasonality in December quarter and channel restocking
Key points:
Historically, December quarter has ~5% down seasonality (mostly in Industrial and Other); in '23 and '24, secular trends trumped seasonality.
December quarter could range from down 5% to plus 5% depending on cycle tailwinds.
Distribution inventory still has pockets in Europe and North America; Asia in good shape; select parts need restocking; net distribution sales expected flat in September quarter.
Mgmt stance: Neutral — seasonality uncertain; taking channel restocking one quarter at a time.
Q5 — Michael C. Doogue (answering Christopher Caso)
Topic: China business momentum and pricing outlook
Key points:
China business robust across broad portfolio; strong new wins in e-Mobility (e.g., xEV current sensor win with Chinese OEM).
China-for-China supply chain well received; stiff competition at lower end, but strategy focuses on higher-end differentiated products.
Pricing: expects low single-digit year-over-year price reduction in auto (normal environment); no tariff-driven price increase demands from customers.
Mgmt stance: Bullish on China growth (innovation, wins); neutral on pricing (normal reduction, no unusual pressure).