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Ambarella (AMBA) Q2 Loss Narrower Than Expected, Revenues Miss
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Ambarella (AMBA - Free Report) reported a second-quarter fiscal 2024 non-GAAP loss of 15 cents per share, which was narrower than the Zacks Consensus Estimate of a loss of 21 cents. The company reported earnings of 20 cents per share in the year-ago quarter.
Second-quarter revenues plunged 23% year over year to $62.1 million, mainly due to customer inventory reduction actions across its IoT end market. Moreover, the top line missed the consensus mark of $62.4 million.
Customer & Market Details
Ambarella had two customers that contributed more than 10% in the reported quarter. WT Microelectronics, a fulfillment partner in Taiwan that serves multiple customers in Asia, accounted for 54% of the company’s second-quarter revenues. Chicony, a Taiwan-based electronics manufacturer serving multiple IoT customers, represented 14% of Ambarella’s revenues.
The momentum of AMBA’s CV flow system-on-a-chip in professional IP cameras continued in the reported quarter. The company expects to achieve its targeted goal of generating 60% of the total revenues from the CV portfolio in 2024.
The non-GAAP gross margin was 64.6%, up 10 basis points year over year in the fiscal second quarter.
On a non-GAAP basis, operating expenses were $46 million, down $200,000 sequentially. Non-GAAP operating expenses were also lower than the company’s prior guidance in the band of $48-$50 million, mainly due to its expense management actions and the timing of spending between quarters.
Balance Sheet
As of Jul 31, 2023, Ambarella had cash and cash equivalents & marketable securities of $216.5 million compared with $227.4 million as of Apr 30, 2023.
Q3 2024 Guidance
Considering accelerated customer inventory actions across its IoT end market and softening end-market demand, the company forecasts third-quarter revenues to decline to $50 million (+/- 4%). AMBA also assumes that fourth-quarter revenues will be in the same range, with the expectation of sequential growth resuming in the first quarter of fiscal 2025.
For the third quarter of fiscal 2024, the non-GAAP gross margin is anticipated at 62-64%. Non-GAAP operating expenses are projected in the range of $46-$49 million.
Zacks Rank & Stocks to Consider
Ambarella currently carries a Zacks Rank #3 (Hold). Shares of AMBA have declined 7.9% year to date (YTD).
The Zacks Consensus Estimate for NVIDIA's third-quarter fiscal 2024 earnings has been revised upward by 39.7% to $3.24 per share in the past seven days. For fiscal 2024, earnings estimates have increased by 30.8% cents to $10.46 per share in the past seven days.
NVIDIA’s earnings beat the Zacks Consensus Estimate thrice in the preceding four quarters while missing on one occasion, the average surprise being 9.8%. Shares of NVDA have surged 233.8% YTD.
The Zacks Consensus Estimate for Manhattan Associates’ third-quarter 2023 earnings has been revised 5 cents northward to 77 cents per share in the past 60 days. For 2023, earnings estimates have moved 22 cents upward to $3.09 per share in the past 60 days.
Manhattan Associates’ earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 31.6%. Shares of MANH have rallied 65% YTD.
The Zacks Consensus Estimate for CrowdStrike's second-quarter fiscal 2024 earnings has remained unchanged at 56 cents per share in the past 60 days. For fiscal 2024, earnings estimates have remained unchanged at $2.39 per share in the past 60 days.
CrowdStrike's earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 19.2%. Shares of CRWD have risen 39.3% YTD.
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Ambarella (AMBA) Q2 Loss Narrower Than Expected, Revenues Miss
Ambarella (AMBA - Free Report) reported a second-quarter fiscal 2024 non-GAAP loss of 15 cents per share, which was narrower than the Zacks Consensus Estimate of a loss of 21 cents. The company reported earnings of 20 cents per share in the year-ago quarter.
Second-quarter revenues plunged 23% year over year to $62.1 million, mainly due to customer inventory reduction actions across its IoT end market. Moreover, the top line missed the consensus mark of $62.4 million.
Customer & Market Details
Ambarella had two customers that contributed more than 10% in the reported quarter. WT Microelectronics, a fulfillment partner in Taiwan that serves multiple customers in Asia, accounted for 54% of the company’s second-quarter revenues. Chicony, a Taiwan-based electronics manufacturer serving multiple IoT customers, represented 14% of Ambarella’s revenues.
The momentum of AMBA’s CV flow system-on-a-chip in professional IP cameras continued in the reported quarter. The company expects to achieve its targeted goal of generating 60% of the total revenues from the CV portfolio in 2024.
Ambarella, Inc. Price, Consensus and EPS Surprise
Ambarella, Inc. price-consensus-eps-surprise-chart | Ambarella, Inc. Quote
Operating Details
The non-GAAP gross margin was 64.6%, up 10 basis points year over year in the fiscal second quarter.
On a non-GAAP basis, operating expenses were $46 million, down $200,000 sequentially. Non-GAAP operating expenses were also lower than the company’s prior guidance in the band of $48-$50 million, mainly due to its expense management actions and the timing of spending between quarters.
Balance Sheet
As of Jul 31, 2023, Ambarella had cash and cash equivalents & marketable securities of $216.5 million compared with $227.4 million as of Apr 30, 2023.
Q3 2024 Guidance
Considering accelerated customer inventory actions across its IoT end market and softening end-market demand, the company forecasts third-quarter revenues to decline to $50 million (+/- 4%). AMBA also assumes that fourth-quarter revenues will be in the same range, with the expectation of sequential growth resuming in the first quarter of fiscal 2025.
For the third quarter of fiscal 2024, the non-GAAP gross margin is anticipated at 62-64%. Non-GAAP operating expenses are projected in the range of $46-$49 million.
Zacks Rank & Stocks to Consider
Ambarella currently carries a Zacks Rank #3 (Hold). Shares of AMBA have declined 7.9% year to date (YTD).
Some better-ranked stocks from the broader technology sector are NVIDIA (NVDA - Free Report) , Manhattan Associates (MANH - Free Report) and CrowdStrike (CRWD - Free Report) . NVIDIA and Manhattan Associates each sport a Zacks Rank #1 (Strong Buy), while CrowdStrike carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today's Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for NVIDIA's third-quarter fiscal 2024 earnings has been revised upward by 39.7% to $3.24 per share in the past seven days. For fiscal 2024, earnings estimates have increased by 30.8% cents to $10.46 per share in the past seven days.
NVIDIA’s earnings beat the Zacks Consensus Estimate thrice in the preceding four quarters while missing on one occasion, the average surprise being 9.8%. Shares of NVDA have surged 233.8% YTD.
The Zacks Consensus Estimate for Manhattan Associates’ third-quarter 2023 earnings has been revised 5 cents northward to 77 cents per share in the past 60 days. For 2023, earnings estimates have moved 22 cents upward to $3.09 per share in the past 60 days.
Manhattan Associates’ earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 31.6%. Shares of MANH have rallied 65% YTD.
The Zacks Consensus Estimate for CrowdStrike's second-quarter fiscal 2024 earnings has remained unchanged at 56 cents per share in the past 60 days. For fiscal 2024, earnings estimates have remained unchanged at $2.39 per share in the past 60 days.
CrowdStrike's earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 19.2%. Shares of CRWD have risen 39.3% YTD.