Lattice Semiconductor Corporation

Q2 2026 revenue was a record $201 million, up 18% sequentially and 62% year over year. Non-GAAP EPS was $0.53, up more than 120% year over year and 29% quarter over quarter. Non-GAAP gross margin was 71.7%, up 170 bps sequentially and 240 bps year over year; non-GAAP operating margin was 38.3%, and EBITDA margin was 43%. Free cash flow was $81.3 million with a 40.4% margin, and GAAP operating cash flow was $88.3 million. For Q3, Lattice guided FPGA revenue to $210 million to $230 million and AMI partial-quarter revenue to $33 million to $37 million, for total revenue of $245 million to $265 million. Non-GAAP gross margin is expected to be 69.5% plus or minus 1%, non-GAAP operating expense $83 million to $90 million, tax rate 4% to 6%, and non-GAAP EPS $0.54 to $0.58. Management also said the combined Q3 revenue guide puts the company at an over $1 billion annualized run rate, and that AMI should contribute meaningful EPS accretion starting in Q4.

Fouad Tamer framed the quarter as evidence of a “healthy market environment” and strong execution, with growth coming from AI data center demand, broader server infrastructure, and a recovering Industrial and Embedded business. He emphasized that attach rates, CapEx, security requirements, and more complex architectures are all supporting demand, while design wins and backlog extending into 2027 reinforce a multiyear growth view. On AMI, he said the acquisition strengthens Lattice’s position in AI infrastructure and could double addressable market, with positive feedback from about 100 hyperscalers, OEMs, ODMs, and partners.

Lorenzo Flores highlighted that Q2 exceeded the high end of guidance, with revenue of $201 million, non-GAAP EPS of $0.53, gross margin of 71.7%, operating margin of 38.3%, and EBITDA margin of 43%. He noted operating cash flow of $88.3 million and free cash flow of $81.3 million, and said the Q2 cash-flow step-up reflected strong performance and the fact that the 2025 annual bonus was paid in Q1. For Q3, he guided combined revenue to $245 million to $265 million, gross margin to 69.5% plus or minus 1%, operating expense to $83 million to $90 million, and EPS to $0.54 to $0.58; he also said the company funded AMI with $925 million of financing and $75 million of cash, and plans to reduce leverage below 2x EBITDA by the end of 2027.

Analysts focused on FPGA attach rates, ASP trends, supply constraints, AMI margin implications, and how Industrial and Embedded is tracking. Management said attach rates continue to rise, ASPs are improving on newer products, and one CPU can now be paired with multiple FPGAs in the AI-supporting infrastructure. On supply, management said assembly capacity remains tight across the industry but expects to get supply and demand back in line by September and be in good shape in Q4 and 2027. On AMI, they said the low-margin hardware pass-through is transitory, the $200 million run-rate excludes it, and the business should be accretive starting in Q4; they also clarified that the 25% AMI growth expectation was for 2027 and does not include revenue synergies.