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SMTC, Semtech Corporation

Semiconductors asset-light Distress / turnaroundCyclicalSerial acquirer

We design, develop, manufacture and market a diverse portfolio of products for commercial applications, addressing the global infrastructure, high-end consumer and industrial end markets.

Infrastructure: data centers, passive optical networks ("PON"), base stations, optical networks, servers, carrier networks, switches and routers, cable modems, wireless local area network ("LAN") and other communication infrastructure equipment.

High-End Consumer: smartphones, tablets, smart glasses, wearables, desktops, notebooks, wireless charging, set-top boxes, digital televisions, monitors and displays, digital video recorders and other consumer equipment.

Latest annual: FY2026 10-K

SMTC · Semtech Corporation

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2026

$1.0B

+15.5% YoY · 12% 5-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $1.1B 5-yr avg $865M

Gross margin 52% 5-yr avg 52%

Operating margin 2.1% 5-yr avg −13.7%

Owner-earnings margin 16% 5-yr avg 9%

Free cash flow margin 16% 5-yr avg 9%

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

Situation: Distress / turnaround. Thin interest coverage, or operating cash burned against real debt, across the record. The balance sheet carries this situation; the debt schedule sets the clock. Cyclical. Margins collapse and recover repeatedly across the record; a single year, good or bad, misstates the through-cycle earning power. Serial acquirer. Goodwill and acquired intangibles are 35% of assets, with meaningful acquisition spending in 4 of the record's 10 years; much of what this business is was bought, at prices the record carries.
What moves the needle: Gross margin has run about 60% and operating margin about 11% through the cycle, a wide spread between price and the cost of what it sells — whether that advantage is durable pricing power or a margin that can erode is the question the record is for. The margin is cyclical, swinging between −109% and 20% over the years, so the through-cycle figure carries more than any single year — and the balance sheet at the trough more than the peak. Inventory runs near 15% of sales, so how fast it turns back into cash — and the risk of writing it down when demand softens — sits alongside the margin. Read this kind of business on process leadership and the capex cycle. On its own account, the filing leans hardest on customer concentration, set against the numbers in what the filing emphasizes, below.
Is it a good business?: Return on capital has sat near the cost of capital (median 9%). The steadier read is owner earnings: roughly 16% of revenue reaches owners as cash, consistently. The cycle and the balance sheet decide this one; the worst year tells more than the median, and the rest is in the 10-K.

Every line is arithmetic on the company's filings, shown in full in the sections below.

Where the money comes from

read the 10-K →

Asia Pacific is 66% of revenue, so this is largely a single-region business.

Revenue by geography, FY2026

Asia Pacific66%$698M
North America22%$232M
Europe11%$121M

From the segment footnote of the company's own 10-K. Shares are of total revenue; the profit bar shows each segment's share of segment operating profit, before unallocated corporate costs.

The record

Ten years of arithmetic, read across the cycle.

The record, 2017–2026

realized figures from each filing · older years to the left

2017’17	2018’18	2019’19	2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	2026’26	TTMTTMApr 2026
											Income statement
$544M	$588M	$627M	$548M	$595M	$741M	$757M	$869M	$909M	$1.0B	$1.1B	RevenueRevenue
60%	60%	60%	61%	60%	62%	63%	34%	50%	52%	52%	Gross marginGross mgn
25%	25%	23%	30%	27%	23%	30%	25%	24%	21%	22%	SG&A / revenueSG&A/rev
19%	18%	17%	20%	20%	20%	22%	21%	19%	19%	19%	R&D / revenueR&D/rev
$84M	$67M	$105M	$52M	$75M	$145M	$93M	($944M)	$50M	$33M	$22M	Operating incomeOp. inc.
15.4%	11.3%	16.8%	9.5%	12.6%	19.6%	12.3%	−108.7%	5.5%	3.1%	2.1%	Operating marginOp. mgn
$55M	$35M	$70M	$32M	$60M	$126M	$61M	($1.1B)	($162M)	($40M)	($33M)	Net incomeNet inc.
25%	40%	1%	29%	5%	11%	22%	—	—	—	—	Effective tax rateTax rate
											Cash flow & returns
$118M	$111M	$184M	$119M	$119M	$203M	$127M	($94M)	$58M	$181M	$190M	Operating cash flowOp. cash
$47M	$49M	$50M	$40M	$24M	$26M	$26M	$29M	$33M	$30M	$29M	DepreciationDeprec.
($15M)	($22M)	($3M)	($5M)	($18M)	$270K	$283K	$929M	$119M	$134M	$116M	Working capital & otherWC & other
$33M	$35M	$17M	$23M	$33M	$26M	$28M	$29M	$8M	$10M	$16M	CapexCapex
6.0%	6.0%	2.7%	4.2%	5.5%	3.5%	3.7%	3.4%	0.9%	0.9%	1.5%	Capex / revenueCapex/rev
$85M	$76M	$167M	$96M	$95M	$177M	$98M	($123M)	$50M	$171M	$173M	Owner earningsOwner earn.
15.6%	12.9%	26.5%	17.5%	16.0%	23.9%	13.0%	−14.2%	5.5%	16.3%	15.9%	Owner earnings marginOE mgn
$85M	$76M	$167M	$96M	$86M	$177M	$98M	($123M)	$50M	$171M	$173M	Free cash flowFCF
15.6%	12.9%	26.5%	17.5%	14.5%	23.9%	13.0%	−14.2%	5.5%	16.3%	15.9%	Free cash flow marginFCF mgn
$0	$18M	$16M	$0	$0	$0	$1.2B	$0	$0	$21M	$51M	AcquisitionsAcquis.
$1M	$15M	$116M	$70M	$71M	$130M	$50M	$0	$0	—	—	BuybacksBuybacks
11%	7%	18%	6%	12%	20%	4%	-80%	—	—	—	ROICROIC
9%	5%	10%	5%	9%	17%	8%	—	-30%	-7%	-6%	Return on equityROE
9%	5%	10%	5%	9%	17%	8%	—	−30%	−7%	−6%	Retained to equityRetained/eq
											Balance sheet
$297M	$308M	$312M	$293M	$269M	$280M	$236M	$129M	$152M	$195M	$163M	Cash & investmentsCash+inv
$51M	$53M	$79M	$62M	$70M	$72M	$162M	$134M	$163M	$161M	$175M	ReceivablesReceiv.
$66M	$71M	$64M	$73M	$87M	$114M	$208M	$145M	$164M	$196M	$205M	InventoryInvent.
$42M	$37M	$43M	$48M	$50M	$51M	$101M	$45M	$59M	$84M	$90M	Accounts payablePayables
$75M	$87M	$100M	$87M	$108M	$135M	$269M	$234M	$267M	$272M	$289M	Operating working capitalOper. WC
$438M	$461M	$485M	$461M	$475M	$502M	$723M	$534M	$585M	$655M	$649M	Current assetsCur. assets
$123M	$126M	$130M	$99M	$110M	$128M	$397M	$217M	$283M	$276M	$274M	Current liabilitiesCur. liab.
3.6×	3.7×	3.7×	4.7×	4.3×	3.9×	1.8×	2.5×	2.1×	2.4×	2.4×	Current ratioCurr. ratio
$330M	$342M	$351M	$351M	$351M	$351M	$1.3B	$541M	$533M	$458M	$471M	GoodwillGoodwill
$1.0B	$1.1B	$1.1B	$1.1B	$1.1B	$1.1B	$2.6B	$1.4B	$1.4B	$1.4B	$1.4B	Total assetsAssets
$241M	$227M	$211M	$195M	$179M	$172M	$1.3B	$1.4B	$552M	$491M	$492M	Total debtDebt
($56M)	($81M)	($101M)	($99M)	($90M)	($108M)	$1.1B	$1.2B	$400M	$296M	$329M	Net debt / (cash)Net debt
—	—	—	—	14.0×	28.5×	5.3×	-9.9×	0.6×	0.8×	0.6×	Interest coverageInt. cov.
$605M	$665M	$683M	$677M	$699M	$738M	$756M	($307M)	$542M	$550M	$573M	Shareholders’ equityEquity
5.7%	8.5%	10.7%	9.5%	8.9%	6.9%	5.2%	4.6%	7.5%	5.5%	7.1%	Stock comp / revenueSBC/rev
—	—	—	—	—	—	—	$756M	$7M	$85M	$85M	Goodwill written downGW imp.
											Per share
66.1M	67.6M	68.5M	67.4M	66.1M	65.6M	64.0M	64.1M	71.6M	88.4M	98.0M	Shares out (diluted)Shares
$8.23	$8.70	$9.16	$8.12	$9.01	$11.30	$11.82	$13.55	$12.70	$11.88	$11.12	Revenue / shareRev/sh
$0.83	$0.51	$1.02	$0.47	$0.91	$1.92	$0.96	$-17.03	$-2.26	$-0.46	$-0.34	EPS (diluted)EPS
$1.28	$1.12	$2.43	$1.42	$1.44	$2.70	$1.54	$-1.92	$0.70	$1.94	$1.77	Owner earnings / shareOE/sh
$1.28	$1.12	$2.43	$1.42	$1.30	$2.70	$1.54	$-1.92	$0.70	$1.94	$1.77	Free cash flow / shareFCF/sh
$0.50	$0.52	$0.25	$0.34	$0.50	$0.40	$0.44	$0.46	$0.11	$0.11	$0.17	Cap. spending / shareCapex/sh
$9.16	$9.84	$9.97	$10.04	$10.58	$11.25	$11.81	$-4.79	$7.58	$6.22	$5.85	Book value / shareBVPS

Per-share growththe realized rate an owner's share compounded

	9-yr	5-yr
Revenue / share	+4.2%/yr	+5.7%/yr
Owner earnings / share	+4.7%/yr	+6.1%/yr
Capital spending / share	−15.4%/yr	−25.9%/yr
Book value / share	−4.2%/yr	−10.1%/yr

The record, charted

FY2017–2026

Each measure over its full record; the current point and the worst year marked.

Share count

88Mpeak FY2026

ROIC

−80%low FY2024

Gross margin

52%low FY2024

Net debt ÷ owner earnings

1.7×peak FY2023

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

$171Mowner earningsvs.($40M)net incomelow FY2024

Where the cash went

ReinvestBuybacksDividendsAcquisitionsRetainedBeyond op. cash

Each year's outlays against its operating cash: the mix, and how it drifts. The hatched cap is spending beyond that year's operating cash — financed from the balance sheet or borrowing, not operations.

FY2017FY2026

Owner-earnings bridge

FY2022–FY2026cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2026 the business turned a $40M loss into $171M of owner earnings: more cash than the profit line showed, after the non-cash charges and the capital it put back in.

	FY2026	FY2025	FY2024	FY2023	FY2022
Reported net income	($40M)	($162M)	($1.1B)	$61M	$126M
Depreciation & amortizationnon-cash charge added back	+$30M	+$33M	+$29M	+$26M	+$26M
Stock-based compensationreal costnon-cash, but a real cost	+$58M	+$68M	+$40M	+$39M	+$51M
Working capital & othertiming of cash in and out, other non-cash items	+$134M	+$119M	+$929M	+$283K	+$270K
Cash from operations	$181M	$58M	($94M)	$127M	$203M
Capital expenditurecash put back in to keep running and to grow	−$10M	−$8M	−$29M	−$28M	−$26M
Owner earnings	$171M	$50M	($123M)	$98M	$177M
Owner-earnings marginowner earnings ÷ revenue	16%	6%	-14%	13%	24%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the capital it must spend to hold its position . The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $58M), owner earnings is nearer $114M.

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2026 10-K · source on SEC EDGAR →

Material weakness in financial controls

“Risks Relating to Compliance We previously identified material weaknesses in our internal control over financial reporting.”

The figures below are only as sound as the controls that produced them. read the note →

Will it survive?

Can it pay its interest? 0.8×

Does not cover its interest

Operating income $33M ÷ interest expense $41M

What this means
A full year of operating profit didn't cover the interest bill. This is the zombie zone: the business depends on refinancing, asset sales, or forbearance to service its debt.
How heavy is the debt, net of cash? $296M · 9.1× operating profit

Heavy net debt

Cash $195M − debt $491M

What this means
Netting $195M of cash and short-term investments against $491M of debt leaves $296M owed, about 9.1× a year's operating profit (15.1× on the gross debt, before the cash). Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? 136d

Long (60+ days)

DSO 56 + DIO 141 − DPO 60 days

What this means
Days cash is tied up between paying suppliers and collecting from customers. Lower is better; a long cycle means growth itself eats cash.

Is it a good business?

Return on invested capital 7%

Below average through the cycle

8-yr median, range -80%–20%; the latest year is left out — large non-operating charges put its operating line well above pretax profit

Industry peers: median 8%

What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 8 years, so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
Owner-earnings margin 16%

High through the cycle

10-yr median margin, range -14%–27%; latest $171M = operating cash $181M − maintenance capex $10M

Industry peers: median 9%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 16% of revenue this year, a 16% median across 10 years. Treating stock comp as the real expense it is (less $58M of SBC) leaves $114M.
Are earnings backed by cash? $181M

Loss, but cash-generative

Net income ($40M) · cash from operations $181M

In the filing’s words The filing discloses a material weakness in its financial controls — the reported numbers here, and the record built on them, are only as reliable as the controls that produced them.

What this means
The company reported a net loss, so a conversion ratio isn't meaningful. What matters then is whether operations still threw off cash, here, they did.

How is the cash used?

Where do the earnings go? 0%

Reinvests most of it

Dividends + buybacks $0 ÷ Owner Earnings $171M

What this means
Of $171M Owner Earnings, $0 (0%) went back to shareholders, $0 dividends, $0 buybacks. Returning most of it is the mark of a mature business with little left to reinvest at a high return; reinvesting most could mean a long runway, or empire-building. The split doesn't say which; the return earned on it (see ROIC) does.
Investing or harvesting? 0.33×

Harvesting

Capex $10M ÷ depreciation $30M

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 1 of 6 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Near

Revenue ≥ $2B · $1.0B

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Pass

Current ratio ≥ 2× · 2.37×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Conservative debt Near

Debt ≤ working capital · $491M vs $379M WC

What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
Earnings stability Miss

A profit every year (10-yr record) · 3 loss years

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Miss

Uninterrupted dividends · none paid

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Earnings growth Miss

Earnings +33% over the record · −914%

What this means
At least a third more earnings than a decade ago, averaging three years at each end. Net income (not per-share), so stock splits don't distort it, buybacks and dilution show up in the share-count line instead.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $-4.63/share (latest year $-0.43), the averaged base the calculator's gate runs on, and book value is $5.90/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2017–2026

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 7 of 10

What this means
Lost money in 3 year(s), look at what happened there before trusting the average.
Return on capital ≥ 15% 2 of 10 yrs

What this means
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
Operating margin 15% → −33% (3-yr avg ends)

What this means
Through the cycle the operating margin slipped — about 15% early to −33% lately, median 11% — competition or costs are biting in.
Reinvestment, incremental ROIC —

What this means
The reinvested base moved too little against the change in profit to read a reliable return on it here — the figure would be a small-denominator artifact, not a moat. Judge this one on the owner-earnings record and the cash it returns instead.
Owner earnings growth +4%/yr

What this means
Owner earnings grew about 4% a year over the record.
Worst year 2024 · −108.7% op. margin

What this means
Operations went underwater in 2024, understand why before trusting the good years.
Share count +3.3%/yr

What this means
The share count is rising, dilution works against you on a per-share basis.

Does AI threaten the moat?

Low contestability

The moat is physical, regulated or balance-sheet-funded, the kind AI cuts costs within but does not contest.

In its own filing A competitive risk, new this year

Its FY2026 10-K names artificial intelligence as a competitive threat, in language that was not in the prior year's filing.

“A growing concentration of demand in AI-related semiconductors may increase our exposure to cyclical industry trends and competitive pressures, which may adversely affect our results of operations.”

AI is unlikely to contest a moat that is physical, regulated or balance-sheet-funded; here it reads more as a cost tool than a threat, and the company is using it that way.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of the latest quarter, Apr 26, 2026

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$649M

Cash & short-term investments$163M
Receivables$175M
Inventory$205M
Other current assets$106M

Current liabilities$274M

Accounts payable$90M
Other current liabilities$183M

Current ratio2.37×all current assets ÷ what's due · Graham looked for 2×

Quick ratio1.62×stricter: inventory excluded

Cash ratio0.60×strictest: cash alone against what's due

Working capital$375Mthe cushion left after near-term bills

Revenue, latest quarter vs. a year ago+15.9%the freshest read on whether the business is still growing

Current ratio, recent quarters2.4× → 2.4×

Deeper floors

Tangible book value$43Mequity stripped of goodwill & intangibles

Debt incl. operating leases$518M$26M of it operating leases

Deferred revenue$26Mcustomer cash collected before delivery; operating float

From the company's latest filing.

How the cash was used, 2017–2026

Over the record, the business generated $1.1B of operating cash; how management split it reads as a balanced allocator, splitting cash between the business, owners, and the balance sheet.

Reinvested$243M · 22%
Buybacks$453M · 40%
Retained (debt / cash)$429M · 38%

Returned to owners$453M
51% of the owner earnings the business produced over the span, $0 as dividends and $453M as buybacks.
Source of fundingOperating cash
Operating cash covered reinvestment and returns; over the span debt rose $251M and cash and short-term investments fell $134M.
Average price paid for buybacks$45.08
Across the years where the filing reports a share count, 3M shares were bought for $132M, about $45.08 each. Year to year the price paid ranged from $25.75 (2017) to $47.47 (2019), and 2019, near the top of that range, was also its heaviest buyback year ($116M).
Net change in share count48.3%
The diluted count rose from 66M to 98M: issuance (stock pay, deals) outran any buybacks, so owners were diluted on net.
Dividend record—
No dividend line was reported in the filing data over the span; the record here neither confirms nor rules out a payout.

Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.

Acquisitions & goodwill

from the balance sheet & the 10-year cash-flow record

Goodwill grows only when a company acquires and falls only when it concedes it overpaid. The size of that bet, the cash put into buying rather than building, and how much has already been written off.

Goodwill & intangibles$498M35% of all assets; the premium carried on the balance sheet for businesses acquired

Against book equity83%goodwill is this share of book equity; the rest is the company’s own retained and paid-in capital

Cash spent acquiring$1.3Bover 10 years buying other businesses, against $243M of capital spent building

$848M written down across 3 years (2024, 2025, 2026): goodwill the company has already conceded it overpaid for, charged against earnings. That is roughly 65% of the cash it put into acquisitions over the span. A write-down costs no cash (the cash went out when the deal was signed), but it is management marking its own past judgment to market.

Goodwill, acquired intangibles and equity from the latest balance sheet; acquisition spend and write-downs summed across the 10-year record, from the company's own filings.

Management, ownership & pay

read the proxy →

From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.

Fiscal year	Pay, as filed	“Actually paid”	Owner earnings
2022	$1.7M	−$2.0M	$177M
2023	$1.1M	−$11.2M	$98M
2024	$7.8M	$5.5M	($123M)
2024	$6.7M	$5.0M	($123M)
2025	$8.8M	$7.8M	$50M
2025	$6.8M	$18.6M	$50M
2026	$8.2M	$18.6M	$171M

Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years.

Insider ownership<1%
The stake all directors and executive officers hold together, per the 2026 proxy: skin in the game, the first thing Munger reads.
Stock-based compensation$58M
The slice of the business handed to employees in shares this year, 5% of revenue, equal to 177% of operating profit. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.

Inverting the record

Invert: instead of why Semtech Corporation is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2017–2026.

4 of the 5 tests turned up something to look into; the other 1 came back clean.

Look hereIs it less profitable than it was?2.6% vs 18.3%
The owner-earnings margin averaged 18.3% early in the record and 2.6% across the last three years, and the latest year has not recovered. Ask the filing whether that is a structural drift or a cyclical trough — price, mix, cost, or a competitor — and whether it is permanent.
Look hereDid the share count rise anyway?48.3%
Diluted shares grew 48.3% over 2017–2026, even as the company spent $453M on buybacks. The repurchases were outrun by issuance — to staff, in a raise, or in a deal — and the filing says which; owners' slice still shrank. Read the buyback line beside this one, not on its own.
Look hereDid debt outgrow the business?$241M → $492M
Debt rose from $241M to $492M while owner earnings went from about $109M to $33M — about 2.2 years of owner earnings in debt then, about 15 now: measured against what the business earns, the balance sheet carries more debt than it did. Debt raised for buybacks or deals rather than growth is the kind that bites in a downturn.
Look hereDid receivables and inventory outpace sales?22% → 35% of sales
Receivables and inventory grew from $117M to $380M while revenue grew 100%: working capital is climbing faster than sales (22% of revenue then, 35% now). That can mean customers paying slower, stock building up, or revenue pulled forward. The filing's cash-flow and receivables notes say which.

And these came back clean

Are "one-time" charges a yearly habit?

Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.

What an owner would ask, FY2026

read the 10-K →

Which reported numbers are a judgment call?
Management names Revenue recognition, Income taxes, Inventory, Acquisitions as critical estimates
each rests partly on management's judgment; the filing's note sets out the assumptionsverify →

The questions the record and the charts do not answer on their own; each carries the figure and the place to look.

Peers, Semiconductors

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
ARRYArray Technologies Inc.	$1.3B	23%	-1.7%	-2%	7%
SEDGSolarEdge Technologies Inc.	$1.2B	31%	10.2%	14%	9%
VIAVViavi Solutions Inc.	$1.1B	58%	5.6%	5%	8%
SYNASynaptics	$1.1B	43%	4.1%	8%	12%
SMTCSemtech Corporation	$1.0B	60%	11.8%	9%	16%
IPGPIPG Photonics Corporation	$1.0B	46%	17.9%	10%	16%
MTSIMACOM Technology Solutions Holdings Inc.	$967M	52%	11.7%	4%	20%
ICHRIchor Holdings	$948M	15%	5.2%	11%	4%
Group median	—	44%	7.9%	9%	11%

The price

What a price has to assume.

What the price implies

reverse-DCF

Type today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Semtech Corporation has delivered.

Today’s price $

Through the cycle, Semtech Corporation earns about $166M on its 15.8% median owner-earnings margin. This year’s 16.3% margin runs in line with that. Normalize, below, values the price on that through-cycle figure rather than the latest year.

Base Normalize · through-cycle ($166M) Net of stock comp (−$77M) Steady-state · maintenance capex ($180M)

—

The assumptions Required return 9% Years of high growth 10 Terminal growth 2.5%

9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.

Enter a price above to run it.

Implied by the price—

Owner-earnings growth · ’22→’26−5%/yr

Owner-earnings growth · ’17→’26+4%/yr

Owner-earnings yield—

P/E (3-yr earnings ’24–’26)—

P/B—

Graham’s price gate—

Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.

Against a high-grade bond: Graham’s yardstick bond yield%

Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.

Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.

Free cash flow $173M on 93M shares outstanding, per the 10-Q cover, as of 2026-05-22; net debt $329M. The if-converted diluted count is 98M, 5% above the shares outstanding: the dilution overhang (convertibles, options) a buyer inherits. The base is the latest year by default; Normalize values it on the through-cycle median owner-earnings margin (to avoid paying on a peak year). Net of stock comp treats option pay as the expense it is. Capex ($16M) runs well above depreciation ($29M), so this is a build-out; Steady-state swaps total capex for maintenance (≈ depreciation), lifting the base to about $180M, the cash it would throw off if it stopped expanding. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.

Weigh SMTC against another business →

The owners of SMTC: the meeting and the votes →

Cite: Owner Scorecard, "Semtech Corporation (SMTC), the owner's record," https://ownerscorecard.com/c/SMTC, data as of 2026-07-09.

Manual order: ← SMR its page in the Manual SN →

Industry order: ← SLAB the Semiconductors chapter SPCB →