RFID manufacturer Impinj (NASDAQ: PI) reported Q3 2026 results topping the market’s revenue expectations, with revenue up 16.7% year on year to $112.1 million. In addition, next quarter’s revenue guidance ($105.5 million at the midpoint) was surprisingly strong at 6.2% above analysts’ consensus estimates. Its non-GAAP profit of $0.69 per share was 13.2% above analysts’ consensus estimates.

For more on Impinj, read our full research report, available free.

“Our third-quarter results were strong, with endpoint IC revenue and unit volumes, as well as total revenue, all setting new quarterly records,” said Chris Diorio, Impinj co-founder and CEO. “M800’s market strength, resilient retail demand, growth at our lighthouse accounts and Gen2X momentum all contributed to those record results, and we see those trends continuing.”

Revenue growth

Examining a company’s long-term performance can provide clues about its quality. Any business can post a good quarter or two, but many enduring ones grow for years. Impinj’s 17.3% annualized revenue growth over the last five years was impressive. Its growth beat the average semiconductor company and shows its offerings resonate with customers. Semiconductors are a cyclical industry, and long-term investors should be prepared for periods of high growth followed by periods of revenue contractions.

Long-term growth is the most important, but short-term results matter for semiconductors because the rapid pace of technological innovation (Moore’s Law) could make yesterday’s hit product obsolete today. Impinj’s recent performance shows its demand has slowed significantly as its annualized revenue growth of 6% over the last two years was well below its five-year trend.

This quarter, Impinj reported year-on-year revenue growth of 16.7%, and its $112.1 million of revenue exceeded Wall Street’s consensus estimates by 4.4%. Company management is currently guiding for a 13.6% year-on-year increase in revenue next quarter.

Looking further ahead, sell-side analysts expect revenue to grow 15.5% over the next 12 months, according to S&P. While this projection implies its newer products and services will fuel better top-line performance, it is still below the sector average.

Product demand & outstanding inventory

Days Inventory Outstanding (DIO) is an important metric for chipmakers, as it reflects a business’s capital intensity and the cyclical nature of semiconductor supply and demand. In a tight supply environment, inventories tend to be stable, allowing chipmakers to exert pricing power. Steadily increasing DIO can be a warning sign that demand is weak, and if inventories continue to rise, the company may have to downsize production.

This quarter, Impinj’s DIO came in at 143, which is 34 days below its five-year average. At the moment, these numbers show no indication of an excessive inventory buildup.

Key takeaways from Impinj’s Q3 results

A marked improvement in inventory levels and EPS above Wall Street’s consensus estimates made this a solid quarter for Impinj. Shares surged 7.8% to $190.76 immediately after the report.

Impinj reported solid earnings, but one quarter doesn’t necessarily make the stock a buy. What happened in the latest quarter matters, but not as much as longer-term business quality and valuation when deciding whether to invest in this stock. For more on those factors, read the full research report here (it’s free).