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Ambarella's (AMBA) Q2 Earnings & Revenues Beat, Fall Y/Y
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Ambarella Inc. (AMBA - Free Report) reported second-quarter fiscal 2019 results, wherein both earnings and revenues surpassed the Zacks Consensus Estimate.
However, on a year-over-year basis, its top- and bottom-line results registered a decline mainly due to an expected fall in chip sales to GoPro Inc. (GPRO - Free Report) , along with the prevalent softness in the drone market. Earnings were also affected by elevated operating expenses.
The top line, however, was within its previously projected range. The company had expected GoPro revenues to be insignificant in the fiscal second quarter with a decline in revenues from non-GoPro sports cameras and wearbles, particularly in the second half of the fiscal. The company had also predicted that the considerable decline in revenues from the drone market will adversely impact the quarter’s top-line performance.
On per-share basis, the company’s non-GAAP earnings came in at 25 cents, witnessing a substantial decline from the year-ago quarter’s level of 48 cents. The fall resulted from lower revenues and elevated operating expenses. However, the figure topped the Zacks Consensus Estimate of 13 cents by a considerable margin.
Notably, the stock has underperformed the industry on a year-to-date basis, losing 32.4% compared with the industry’s decline of 1.5%.
Quarter in Detail
The company’s fiscal second-quarter revenues slipped 12.8% year over year to $62.47 million. However, quarterly revenues topped the Zacks Consensus Estimate of $62.27 million. The company’s revenues came a little higher than the mid-point of management’s guided range of $60-$64 million.
On a non-GAAP basis, the company reported gross margin of 61.4%, which came in 160 basis points lower than the year-ago quarter.
Non-GAAP net income plunged to $8.5 million from $19.3 million reported in the year-ago quarter.
Balance Sheet
Ambarella ended the fiscal second quarter with cash and cash equivalents & marketable securities of $376 million, down from $414.1 million recorded in the previous quarter.
During the reported quarter, the company bought back 1,119,193 shares, for a total cash consideration of $45 million approximately. Since the inception of its share-repurchase program on Jun 5, 2018, the company has bought back a total of 862,805 shares for a total consideration of $33.9 million approximately.
Guidance
For third-quarter fiscal 2019, revenues are expected between $55.5 million and $58.5 million (mid-point $57 million). The guidance is lower than the Zacks Consensus Estimate of $73.8 million.
Non-GAAP gross margin is expected between 59% and 60.5%.
Non-GAAP operating expenses are estimated in the range of $30.5-$32 million.
Zacks Rank & Stocks to Consider
Ambarella currently carries a Zacks Rank #3 (Hold).
Long-term earnings growth for Virtusa, Qualys and Fortinet is projected to be 20% and 16.8%, respectively.
5 Companies Verge on Apple-Like Run
Did you miss Apple's 9X stock explosion after they launched their iPhone in 2007? Now 2018 looks to be a pivotal year to get in on another emerging technology expected to rock the market. Demand could soar from almost nothing to $42 billion by 2025. Reports suggest it could save 10 million lives per decade which could in turn save $200 billion in U.S. healthcare costs. A bonus Zacks Special Report names this breakthrough and the 5 best stocks to exploit it. Like Apple in 2007, these companies are already strong and coiling for potential mega-gains.
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Ambarella's (AMBA) Q2 Earnings & Revenues Beat, Fall Y/Y
Ambarella Inc. (AMBA - Free Report) reported second-quarter fiscal 2019 results, wherein both earnings and revenues surpassed the Zacks Consensus Estimate.
However, on a year-over-year basis, its top- and bottom-line results registered a decline mainly due to an expected fall in chip sales to GoPro Inc. (GPRO - Free Report) , along with the prevalent softness in the drone market. Earnings were also affected by elevated operating expenses.
The top line, however, was within its previously projected range. The company had expected GoPro revenues to be insignificant in the fiscal second quarter with a decline in revenues from non-GoPro sports cameras and wearbles, particularly in the second half of the fiscal. The company had also predicted that the considerable decline in revenues from the drone market will adversely impact the quarter’s top-line performance.
Ambarella, Inc. Price, Consensus and EPS Surprise
Ambarella, Inc. Price, Consensus and EPS Surprise | Ambarella, Inc. Quote
On per-share basis, the company’s non-GAAP earnings came in at 25 cents, witnessing a substantial decline from the year-ago quarter’s level of 48 cents. The fall resulted from lower revenues and elevated operating expenses. However, the figure topped the Zacks Consensus Estimate of 13 cents by a considerable margin.
Notably, the stock has underperformed the industry on a year-to-date basis, losing 32.4% compared with the industry’s decline of 1.5%.
Quarter in Detail
The company’s fiscal second-quarter revenues slipped 12.8% year over year to $62.47 million. However, quarterly revenues topped the Zacks Consensus Estimate of $62.27 million. The company’s revenues came a little higher than the mid-point of management’s guided range of $60-$64 million.
On a non-GAAP basis, the company reported gross margin of 61.4%, which came in 160 basis points lower than the year-ago quarter.
Non-GAAP net income plunged to $8.5 million from $19.3 million reported in the year-ago quarter.
Balance Sheet
Ambarella ended the fiscal second quarter with cash and cash equivalents & marketable securities of $376 million, down from $414.1 million recorded in the previous quarter.
During the reported quarter, the company bought back 1,119,193 shares, for a total cash consideration of $45 million approximately. Since the inception of its share-repurchase program on Jun 5, 2018, the company has bought back a total of 862,805 shares for a total consideration of $33.9 million approximately.
Guidance
For third-quarter fiscal 2019, revenues are expected between $55.5 million and $58.5 million (mid-point $57 million). The guidance is lower than the Zacks Consensus Estimate of $73.8 million.
Non-GAAP gross margin is expected between 59% and 60.5%.
Non-GAAP operating expenses are estimated in the range of $30.5-$32 million.
Zacks Rank & Stocks to Consider
Ambarella currently carries a Zacks Rank #3 (Hold).
A few better-ranked stocks in the broader Computer and Technology sector are Virtusa Corporation and Fortinet, Inc. (FTNT - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term earnings growth for Virtusa, Qualys and Fortinet is projected to be 20% and 16.8%, respectively.
5 Companies Verge on Apple-Like Run
Did you miss Apple's 9X stock explosion after they launched their iPhone in 2007? Now 2018 looks to be a pivotal year to get in on another emerging technology expected to rock the market. Demand could soar from almost nothing to $42 billion by 2025. Reports suggest it could save 10 million lives per decade which could in turn save $200 billion in U.S. healthcare costs. A bonus Zacks Special Report names this breakthrough and the 5 best stocks to exploit it. Like Apple in 2007, these companies are already strong and coiling for potential mega-gains.
Click to see them right now >>