As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q3. Today, we are looking at processors and graphics chips stocks, starting with Allegro MicroSystems (NASDAQ:ALGM).
The biggest demand drivers for processors (CPUs) and graphics chips at the moment are secular trends related to 5G and Internet of Things, autonomous driving, and high performance computing in the data center space, specifically around AI and machine learning. Like all semiconductor companies, digital chip makers exhibit a degree of cyclicality, driven by supply and demand imbalances and exposure to PC and Smartphone product cycles.
The 9 processors and graphics chips stocks we track reported a very strong Q3. As a group, revenues beat analysts’ consensus estimates by 2.7% while next quarter’s revenue guidance was 12,441% above.
In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.
Weakest Q3: Allegro MicroSystems (NASDAQ:ALGM)
The result of a spinoff from Sanken in Japan, Allegro MicroSystems (NASDAQ:ALGM) is a designer of power management chips and distance sensors used in electric vehicles and data centers.
Allegro MicroSystems reported revenues of $214.3 million, up 14.4% year on year. This print exceeded analysts’ expectations by 1.4%. Despite the top-line beat, it was still a mixed quarter for the company with revenue guidance for next quarter topping analysts’ expectations but EPS in line with analysts’ estimates.
“We delivered strong second quarter results, with sales of $214 million, up 14% year-over-year, and led by growth in both e-Mobility and Industrial & Other, increasing 21% and 23% year-over-year, respectively. Non-GAAP EPS was $0.13, increasing more than 60% year-over-year,” said Mike Doogue, President and CEO of Allegro.
Interestingly, the stock is up 7.7% since reporting and currently trades at $33.10.
Read our full report on Allegro MicroSystems here, it’s free.
Best Q3: Penguin Solutions (NASDAQ:PENG)
Based in the US, Penguin Solutions (NASDAQ:PENG) is a diversified semiconductor company offering memory, digital, and LED products.
Penguin Solutions reported revenues of $343.1 million, flat year on year, outperforming analysts’ expectations by 1.2%. The business had an exceptional quarter with a significant improvement in its inventory levels and a beat of analysts’ EPS estimates.
Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 7.7% since reporting. It currently trades at $19.99.
Is now the time to buy Penguin Solutions? Access our full analysis of the earnings results here, it’s free.
Lattice Semiconductor (NASDAQ:LSCC)
A global leader in its category, Lattice Semiconductor (NASDAQ:LSCC) is a semiconductor designer specializing in customer-programmable chips that enhance CPU performance for intensive tasks such as machine learning.
Lattice Semiconductor reported revenues of $133.3 million, up 4.9% year on year, in line with analysts’ expectations. It was a mixed quarter as it posted a significant improvement in its inventory levels but a miss of analysts’ adjusted operating income estimates.
Lattice Semiconductor delivered the weakest performance against analyst estimates in the group. Interestingly, the stock is up 16.8% since the results and currently trades at $83.45.
Read our full analysis of Lattice Semiconductor’s results here.
AMD (NASDAQ:AMD)
Founded in 1969 by a group of former Fairchild semiconductor executives led by Jerry Sanders, Advanced Micro Devices (NASDAQ:AMD) is one of the leading designers of computer processors and graphics chips used in PCs and data centers.
AMD reported revenues of $9.25 billion, up 35.6% year on year. This result surpassed analysts’ expectations by 5.6%. Overall, it was a strong quarter as it also logged an impressive beat of analysts’ revenue estimates and revenue guidance for next quarter beating analysts’ expectations.
AMD achieved the biggest analyst estimates beat among its peers. The stock is down 7.3% since reporting and currently trades at $231.81.
Read our full, actionable report on AMD here, it’s free.
Broadcom (NASDAQ:AVGO)
Originally the semiconductor division of Hewlett Packard, Broadcom (NASDAQ:AVGO) is a semiconductor conglomerate spanning wireless communications, networking, and data storage as well as infrastructure software focused on mainframes and cybersecurity.
Broadcom reported revenues of $18.02 billion, up 28.2% year on year. This number beat analysts’ expectations by 3%. It was a very strong quarter as it also put up a significant improvement in its inventory levels and revenue guidance for next quarter beating analysts’ expectations.
The stock is down 13.4% since reporting and currently trades at $352.10.
Read our full, actionable report on Broadcom here, it’s free.
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