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Lattice (LSCC) Up 18.9% Since Last Earnings Report: Can It Continue?

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A month has gone by since the last earnings report for Lattice Semiconductor (LSCC - Free Report) . Shares have added about 18.9% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Lattice due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its latest earnings report in order to get a better handle on the important drivers.

Lattice Q2 Earnings Meet Estimates Despite Lower Revenues

Lattice reported relatively modest second-quarter 2025 results, with both the top and bottom lines matching the respective Zacks Consensus Estimate. The Hillsboro-based semiconductor company reported marginal revenue contraction owing to macroeconomic headwinds. Healthy traction in generative AI applications for data centers, in-cabin and advanced driver assistance systems in automotive applications buoyed the top line. Management’s strong focus on expanding the FPGA portfolio through innovations is a tailwind.

Net Income

On a GAAP basis, the company reported a net income of $2.9 million or 2 cents per share, compared with $22.6 million or 16 cents per share in the year-ago quarter. Higher operating expenses primarily contributed to the decline in the bottom line.

Non-GAAP net income in the reported quarter was $32.6 million or 24 cents per share compared with $31.4 million or 23 cents per share in the prior-year quarter. The adjusted earnings matched the Zacks Consensus Estimate.

Revenues

Net sales in the quarter declined marginally to $123.97 million from $124.08 million in the year-ago quarter as improvements in channel inventory and product innovations were offset by a challenging macroeconomic environment. The top line matched the consensus estimate of $124 million.

In the second quarter, Communications and Computing revenues increased to $68.7 million from $54.6 million with normalized inventory, solid demand and strength in data center infrastructure, including network interface cards, switches, routers and security appliances. Revenues from Industrial and Automotive declined to $47.3 million from $58.2 million in the prior-year quarter, owing to higher channel inventory levels. Total Consumer revenues were $8 million, down from $11.3 million.

Region-wise, in the first quarter of 2025, the company generated 67% of revenue from Asia while 22% of the net sales came from the Americas. Europe and Africa contributed 11% of the total revenues.

Other Details

Adjusted EBITDA increased to $42.2 million from $40 million in the year-ago quarter. GAAP operating expenses rose to $80 million from $62.2 million in the year-ago quarter.

Cash Flow & Liquidity

In the first six months of 2025, Lattice generated $70.4 million in cash from operating activities compared with $51.4 million in the prior-year period. As of June 28, 2025, the company had $107.2 million in cash and cash equivalents with $18.6 million other long-term liabilities.

Outlook

For the third quarter of 2025, Lattice expects revenues in the range of $128-$138 million. Non-GAAP gross margin is anticipated to be in the band of 68.5%-70.5%. Non-GAAP total operating expenses are projected to be in the range of $52-$54 million, with non-GAAP net income within 26-30 cents per share.

How Have Estimates Been Moving Since Then?

Since the earnings release, investors have witnessed a upward trend in estimates review.

The consensus estimate has shifted -7.83% due to these changes.

VGM Scores

Currently, Lattice has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. Following the exact same course, the stock was allocated a score of F on the value side, putting it in the lowest quintile for value investors.

Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Lattice has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.

Performance of an Industry Player

Lattice belongs to the Zacks Electronics - Semiconductors industry. Another stock from the same industry, Lam Research (LRCX - Free Report) , has gained 0.4% over the past month. More than a month has passed since the company reported results for the quarter ended June 2025.

Lam Research reported revenues of $5.17 billion in the last reported quarter, representing a year-over-year change of +33.6%. EPS of $1.33 for the same period compares with $0.81 a year ago.

For the current quarter, Lam Research is expected to post earnings of $1.21 per share, indicating a change of +40.7% from the year-ago quarter. The Zacks Consensus Estimate has changed -0.2% over the last 30 days.

The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Lam Research. Also, the stock has a VGM Score of B.


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