Tower Semiconductor (NASDAQ: TSEM) stock gained after it reported fiscal third-quarter results on Monday. It also gained in sympathy with its semiconductor industry peers.
The company reported quarterly revenue growth of 6.8% year over year (Y/Y) to $395.67 million, beating the analyst consensus estimate of $393.98 million.
The Israel-based contract chipmaker's adjusted EPS of 55 cents beat the analyst consensus estimate of 54 cents.
Also Read: Tower Semiconductor Eyes Strong Growth As RF Infrastructure Momentum Builds
Gross profit was $93.05 million, flat Y/Y. The margin declined to 23.5% from 25.1% Y/Y. Operating profit of $50.58 million decreased 9.3% Y/Y.
During the quarter, the company generated $139.42 million in operating cash flow (up from $124.74 million Y/Y) and held $1.22 billion in cash and equivalents.
Tower Semiconductor CEO Russell Ellwanger said the company's core technologies—power management, image sensors, and 65nm RF mobile—are all generating year-over-year revenue growth, creating a strong foundation for expansion. He emphasized that Tower's leadership in SiGe and SiPho technologies for optical transceivers, coupled with surging data center demand, is driving both top- and bottom-line growth.
Ellwanger added that Tower is advancing customer qualifications, investing further in its Newport Beach Fab 3, and repurposing three additional fabs to expand SiPho and SiGe production capacity. These initiatives are beginning to contribute to growth, reflected in the company's record fourth-quarter 2025 revenue guidance.
To support this expansion, Tower is allocating an additional $300 million to grow capacity and enhance next-generation capabilities.
Outlook
Tower Semiconductor expects fourth-quarter revenue of $418.00 million-$462.00 million compared to the $434.35 million analyst consensus estimate.
TSEM Price Action: TSEM stock is trading higher by
4.18% to $87.58 at last check on Monday.
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