Earnings

AOS AI and Server Sales Reach 20% of Revenue

The Tip Desk · November 11, 2026 · 3 min read

Fiscal first-quarter revenue was $177.8 million as non-GAAP gross margin reached 25.2% and the company guided December-quarter sales to about $180 million.

Alpha and Omega Semiconductor Limited (AOSL) reported fiscal first-quarter revenue of $177.8 million for the three months ended September 30, 2026, up 4.3% from the prior quarter and down 2.6% from a year earlier, slightly above the midpoint of its guidance.

The power-semiconductor designer said AI and server applications accounted for about 20% of total company revenue, versus 5.5% a year earlier. Within Advanced Computing, which includes AI, servers, and graphics cards, those applications grew more than 65% sequentially and more than 250% year-over-year.

GAAP gross margin expanded to 24.5% from 23.1% in the June quarter. Non-GAAP gross margin improved 150 basis points sequentially to 25.2%. Chief Executive Officer Stephen Chang said improving business mix contributed to higher gross margins.

GAAP operating loss narrowed to $9.0 million from $11.0 million in the prior quarter. Non-GAAP operating loss was $1.0 million, versus a $4.8 million loss in the June quarter. GAAP net loss was $6.1 million, or $0.20 a share. Non-GAAP net loss was $2.1 million, or $0.07 a share. Non-GAAP results excluded share-based compensation, a $302,000 typhoon-related loss, and a $581,000 impairment of long-lived assets.

Computing revenue was $83.2 million, down 2.0% sequentially and 14.3% year-over-year, and 46.8% of total revenue. Advanced Computing increased more than 50% sequentially and 80% year-over-year, reaching nearly 23% of total company revenue, ahead of the company’s expectation of more than 40% sequential growth. Traditional PC-related revenue declined approximately 30% sequentially. Chang said elevated memory costs and growing component shortages weighed on traditional PC demand.

Communications revenue was $37.8 million, up 15.0% sequentially and 15.8% year-over-year, above guidance for about 10% sequential growth. Battery PCM revenue increased more than 50% sequentially on a ramp in battery protection for a Tier One U.S. smartphone customer.

Power Supply and Industrial revenue was $38.7 million, up 29.2% sequentially and 38.8% year-over-year, in line with guidance for nearly 30% sequential growth. DC fans achieved record quarterly revenue.

Consumer revenue was $16.1 million, down 22.9% sequentially and 31.4% year-over-year, with declines in Home Appliances, Gaming, and Wearables.

Cash flows provided by operating activities were $5.6 million, versus $10.0 million of cash used in the prior quarter. Cash and cash equivalents ended at $175.2 million.

For the fiscal second quarter ending December 31, 2026, the company expects revenue of approximately $180 million, plus or minus $10 million, GAAP gross margin of 25.1% plus or minus 1%, and non-GAAP gross margin of 25.7% plus or minus 1%. GAAP operating expenses are expected at $52.0 million plus or minus $1.0 million.

Management expects Advanced Computing to set another quarterly revenue record in the December quarter, but total Computing revenue to decline mid-to-high single digits sequentially as traditional PC weakness more than offsets that growth. Communications revenue is expected to grow mid-teens sequentially, Power Supply and Industrial high-single digits sequentially, and Consumer to be flattish. Total revenue is expected up slightly sequentially and approximately 10% year-over-year.

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