SMTCSemtech Corporation
Is the business good?
A genuinely good business: 7 of 9 health tests passed, earnings fully cash-backed (2.9×), and margins widening.
High fundamental quality. Nine pass/fail tests of year-over-year health from the filings.
Operating profit is fully backed by cash.
Positive operating leverage, operating profit is growing faster than sales, so margins widen as the business scales.
A balanced mix of margins, efficiency, and leverage. ROE 3% = margin × turnover × leverage.
Unless marked, from derived.
Against the whole market›
Percentile against every name Ryufin tracks. Higher is better; the tick marks the middle of the market. Context, not one of the checks above.
Where this answer is blind. The F-score rewards improvement, so an already-elite company can score mid-pack.
How good a business is SMTC?
Semtech Corporation earns 7.2% on the capital it employs against a 9.0% cost of capital, so growth costs more than it returns.
Return on invested capital · cost of capital 9.0% · 1.8 points below what the capital costs: growth destroys value
- Operating margin
- 8.0%
Operating margin · Semiconductors median 7.5% · 12 months to Q2 2026
- Cash conversion
- 2.87×
Cash conversion · 2.91× a year ago · operating cash flow covers the operating profit after tax
- Share count, year on year
- +16%
Share count, year on year · shareholders own a smaller slice than a year ago
| Year | Operating margin |
|---|---|
| FY2020 | 13% |
| FY2021 | 20% |
| FY2022 | 12% |
| FY2023 | −109% |
| FY2024 | 5.5% |
| FY2025 | 3.1% |
Details›
- Gross margin12 months to Q2 2026
- 52%
- Operating margin12 months to Q2 2026
- 8.0%
- Net margin12 months to Q2 2026
- 13%
- Free cash flow margin
- 16%
- R&D as % of revenue
- 19%
- Revenue, trailing twelve months
- $1.17B
- Free cash flow, trailing twelve months
- $193M
- Net income, trailing twelve months
- $154M
- Return on invested capitaloperating profit after tax ÷ debt + equity − cash
- 7.2%
Margins, capital and share counts from the statements as filed with the SEC; cash conversion is operating cash flow over operating profit after tax.
Customers and suppliers
Who buys from SMTC and who it buys from, as the companies report it.
- Customer B14%
Share of revenue · FY2026 10-K
- Customer A11%
Share of revenue · FY2026 10-K
None disclosed.
A company has to disclose every customer behind 10% or more of its revenue. Each share comes from the latest annual report of the company that states it and shows on both companies’ pages; SMTC’s own figures are from its FY2026 10-K. Smaller customers and suppliers go unreported.