01—Abstract
Summary
Summary of the 10-Q filed May 4, 2026. Cited figures are marked; the original filing is the authoritative source.
Monolithic Power Systems, Inc. (MPWR) reported strong financial results for the first quarter ended March 31, 2026.
Revenue surged by 26.1% year-over-year to $804.2 milliona, driven by robust demand in the enterprise data sector, particularly for AI and server applications, along with significant growth in communications. This top-line expansion, coupled with stable gross margins at 55.3%, translated into a substantial increase in operating income, up 42.9% to $241.2 million.
Net income also saw a significant rise of 43.1% to $193.2 million, with diluted EPS growing to $3.92b from $2.81 in the prior year's quarter. The company maintained a strong liquidity position with over $1.36 billion in cash, cash equivalents, and short-term investments, providing ample resources to fund operations, capital expenditures, and shareholder returns.
02—Key points
Key Highlights
- Revenue increased by 26.1% to $804.2 million for the first quarter of 2026, compared to $637.6 million in the prior year period.
- Enterprise Data revenue saw a substantial increase of 97.7% to $262.8 million, driven by AI and server applications.
- Gross margin remained strong at 55.3%, slightly down from 55.4% in the prior year, reflecting stable operational efficiency.
- Operating income grew significantly by 42.9% to $241.2 million, indicating strong operational leverage.
- Net income rose by 43.1% to $193.2 million, demonstrating robust profitability.
- Diluted earnings per share (EPS) increased to $3.92 from $2.81 year-over-year.
- The company ended the quarter with a healthy cash, cash equivalents, and short-term investment balance of $1.37 billion.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q1 FY2026, Monolithic Power Systems kept $0.24.
- Revenue$804.2M100.0%
- Cost of revenue−$359.1M44.7%
- Gross profit$445.1M55.3%
- Operating costs−$203.9M25.4%
- Operating income$241.2M30.0%
- Interest, other & tax−$47.9M6.0%
- Net income$193.2M24.0%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2026filed May 4, 2026Financial Statements
Q1 FY2026 against Q1 FY2025
| Line item | Q1 FY2026Q1 FY2025 | Change |
|---|---|---|
| Revenue | $804.18M$637.55M | +26.1% |
| Cost of Revenue | $359.12M$284.32M | +26.3% |
| Gross Profit | $445.06M$353.23M | +26.0% |
| SG&A Expenses | $103.35M$92.24M | +12.0% |
| Operating Expenses | $203.91M$184.47M | +10.5% |
| Operating Income | $241.15M$168.76M | +42.9% |
| Net Income | $193.23M$135.05M | +43.1% |
| EPS (Basic) | $3.94$2.82 | +39.7% |
| EPS (Diluted) | $3.92$2.81 | +39.5% |
| Shares Outstanding (Basic) | 49.10M47.85M | +2.6% |
| Shares Outstanding (Diluted) | 49.24M48.01M | +2.6% |
05—Questions
Frequently Asked Questions
What were the main drivers of revenue growth in the first quarter of 2026?
Revenue growth was primarily driven by higher shipment volumes and improved average selling prices, largely due to a favorable product mix. The Enterprise Data segment, particularly for AI and server applications, showed exceptional growth, and the Communications segment also contributed significantly.
How has the company's gross margin performed?
The gross margin remained stable at 55.3% for the first quarter of 2026, compared to 55.4% in the same period last year. This slight decrease was mainly attributed to higher warranty expenses as a percentage of revenue, partially offset by lower manufacturing overhead costs.
What is the company's liquidity and financial position?
Monolithic Power Systems maintains a strong liquidity position, with cash, cash equivalents, and short-term investments totaling $1.37 billion as of March 31, 2026. This is a significant increase from $1.26 billion at the end of the previous year, indicating ample resources to fund operations, capital expenditures, and shareholder returns.
Are there any material concerns or risks highlighted in the filing?
The company reported a material weakness in internal control over financial reporting related to the accounting for deferred income taxes. While remediation efforts are underway, management has concluded that disclosure controls were not effective as of March 31, 2026. The company is working to remediate this issue by the end of fiscal year 2026. Additionally, the company acknowledges risks related to macroeconomic conditions, global tariffs, and potential litigation.
06—Continue