Power Integrations Profit Recovers as Sequential Sales Growth Slows

The Tip Desk · November 10, 2026 · 3 min read

Third-quarter revenue was $125.5 million as GAAP earnings reached $0.32 a share and the company guided fourth-quarter sales to $118.0 million to $126.0 million.

Power Integrations (POWI) reported third-quarter revenue of $125.5 million, up five percent from the prior quarter and six percent from the third quarter of 2025. Sequential growth slowed from the ten percent increase recorded in the second quarter.

GAAP net income was $18.3 million, or $0.32 a share, compared with $0.17 a share in the second quarter and a $0.02 loss a share a year earlier. Non-GAAP earnings were $0.46 a share.

Chief executive Jen Lloyd said revenue growth was driven by PowiGaN products and continued strength in the industrial market, where revenue is up 13 percent year-to-date. She also cited a continued focus on expense discipline and profitability.

GAAP operating income was $19.1 million and GAAP operating margin was 15.2 percent, versus $8.9 million and 7.5 percent in the prior quarter. Non-GAAP operating margin expanded to 21.4 percent from 17.1 percent. GAAP gross margin was 55.6 percent; non-GAAP gross margin was 55.2 percent.

A legal judgment was settled in the quarter ended September 30, 2026, reducing a previously established reserve and producing $1.75 million of litigation-related income in other operating expenses. Other operating expenses swung to income of $2.0 million from an expense of $0.5 million in the second quarter.

Industrial remained 43 percent of the revenue mix, matching the prior quarter. Consumer fell to 32 percent from 36 percent. Computer rose to 13 percent from 11 percent, and communications was 12 percent versus 10 percent.

Cash flow from operations was $42.6 million, versus $22.0 million in the second quarter. Cash and cash equivalents were $96.8 million at September 30, 2026. Inventories were $150.3 million.

The company paid a dividend of $0.215 a share on September 30, 2026. It expects to pay quarterly dividends of $0.22 a share for each of the four quarters of 2027.

For the fourth quarter of 2026, Power Integrations expects revenue of $118.0 million to $126.0 million, below the third-quarter guide of $122 million to $130 million. GAAP gross margin is expected at 54.0 percent to 55.0 percent, and non-GAAP gross margin at 54.5 percent to 55.5 percent. GAAP operating expenses are expected at $53.0 million to $54.0 million, and non-GAAP operating expenses at $42.5 million to $43.5 million. GAAP operating margin is expected at 10.0 percent to 12.0 percent, versus the third-quarter 2026 guide of 8.3 percent to 10.9 percent, and non-GAAP operating margin at 19.0 percent to 21.0 percent, versus the third-quarter 2026 guide of 17 percent to 19 percent.

Lloyd said power is becoming a critical constraint thanks to AI and electrification, calling for advances in efficiency and power density, and that the company’s high-voltage technology and system expertise are aligned with those challenges.