Synaptics Incorporated (NASDAQ: SYNA) is targeting a significant revenue ramp in calendar 2027 from its artificial intelligence processors, supported by a rapidly growing pipeline of more than 35 robotics customers adopting its tactile sensing and edge computing chips. The company reported its sixth consecutive quarter of double-digit growth, with strength in its core Internet of Things (IoT) division pointing to early traction in its strategic shift toward high-value AI applications.
"Our broad and differentiated portfolio across processing, connectivity, sensing and interface solutions uniquely positions us to address this opportunity," President and CEO Rahul Patel said on the company's Q3 2026 earnings call, highlighting the expanding customer engagements in "Physical AI."
For its third quarter, Synaptics posted revenue of $294.2 million, up 10 percent year-over-year and beating the midpoint of its guidance. Non-GAAP earnings per share rose 21 percent to $1.09. The growth was led by the Core IoT segment, which saw revenues climb 31 percent year-over-year, while the enterprise and automotive segment grew 9 percent. For its upcoming fourth quarter, the company guided for revenue of approximately $305 million and non-GAAP EPS of $1.20 at the midpoint.
The results underscore a strategic pivot for the human-interface vendor, which is leveraging its technology to capture new markets in robotics and on-device AI processing. Patel said the company anticipates a "meaningful ramp" in revenue from its Astra family of AI processors in calendar 2027, cautioning that significant revenue from the still-nascent robotics market is not yet factored into its 2027 plan.
Synaptics is gaining commercial traction in the robotics market, particularly for humanoids. The company has sampled silicon to four humanoid OEMs and counts a "leading generative AI OEM" among its 35 global robotics customers. The primary application is for tactile sensing, where Synaptics' capacitive controllers measure force, slip, and proximity to enable robots to handle objects with dexterity.
Patel noted the silicon content in these platforms is currently in the "few tens of dollars per platform" for touch and interface technologies alone. This opportunity can grow as customers adopt the company's Astra processors for local AI decision-making and its wireless portfolio, which includes Wi-Fi 7 and Bluetooth 6.0, for connectivity. The majority of these advanced engagements are concentrated in North America.
The Astra processor platform remains central to the company's long-term strategy, anchored by a key partnership with Google. Synaptics recently launched a new Coral Dev Board powered by its Astra SL2610 processor, which integrates Google's Coral NPU. This provides developers a platform to move AI applications from prototype to production.
Further, Synaptics has taped out a next-generation semi-custom AI-native microcontroller, the Astra SR series, targeting wearable applications for a "very large OEM." The chip, which integrates Google's Coral NPU and is expected to sample this fall, is projected to deliver double the battery life and a 50 percent reduction in the bill of materials for the initial application. Production is slated for the first half of 2027, aligning with the expected revenue ramp.
While future growth is tied to AI, the company's core business showed steady results. Demand from enterprise PC customers continued to improve, with Synaptics' focus on the premium tier providing a cushion against potential market headwinds.
In the mobile touch segment, which saw revenues decline 16 percent year-over-year, performance was mixed. Patel cited memory supply challenges impacting China-based smartphone customers. However, this was partially offset by market share gains at a "leading Korean OEM," where Synaptics is shipping into the majority of its flagship phones and new foldable models expected in the second half of the year.
This article is for informational purposes only and does not constitute investment advice.
