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Ambarella stock climbed 16% higher Friday as the chip designer reported better-than-expected fiscal second-quarter results and issued strong guidance.
Here’s how the company did compared with LSEG expectations:
- Earnings: 15 cents per share adjusted vs 5 cents per share expected
- Revenue: $96 million vs $90 million expected
Ambarella, which is known for its system-on-chip semiconductors and software used for edge artificial intelligence, said it expects fiscal third-quarter revenue between $100 million and $108 million, beating the LSEG estimate of $91 million.
The company boosted its fiscal-year revenue growth outlook to a range of 31%-35%, to $379 million at the midpoint, which topped the $350 million expected by LSEG.
“After a multiyear period of significant edge AI R&D investment, our broad product portfolio enable us to address a rising breadth of edge AI applications,” CEO Fermi Wang said on a call with analysts Thursday.
Wang singled out strength in “portable video, robotic aerial drones and edge infrastructure.”
Edge computing refers to the direct processing and storing of data at the device level instead of those actions being handled remotely in the cloud at a data center.
Ambarella had a net loss of $20 million or a loss of 47 cents per share in the second quarter. That narrowed from the same quarter a year ago, when the company had a net loss of $35 million or a loss of 85 cents per share. Revenue rose 50%.
The company earned 15 cents per share after adjusting for stock-based compensation and the amortization of acquisition-related costs.
In June, Bloomberg reported the company was considering a sale and had held talks with banks. The company’s shares climbed 20% higher on the news.
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Ambarella year-to-date stock chart.