Ambarella, a maker of chips for computer vision systems and video surveillance cameras, late Tuesday beat analyst estimates for its fiscal fourth quarter but guided well below views for the current quarter. AMBA stock tumbled in extended trading.
The Santa Clara, Calif.-based company earned an adjusted 23 cents a share on sales of $83.3 million in the quarter ended Jan. 31. Analysts polled by FactSet had expected Ambarella earnings of 14 cents a share on sales of $83 million. On a year-over-year basis, Ambarella earnings dropped 49% while sales slid 8%.
For the current quarter ending April 30, Ambarella predicted sales of $60 million to $64 million. The midpoint of $62 million would translate to a year-over-year decline of 31%. Analysts had been looking for $77.1 million in sales for the fiscal first quarter.
"Our customers indicate end-market demand is healthy, but we are experiencing a more pronounced slowdown as they reduce inventory," Chief Executive Fermi Wang said in a news release.
He added, "Our Q1 revenue is expected to be well below end market consumption, and we currently do not expect these existing cyclical factors to cause future quarter revenue to decline below our Q1 guidance."
AMBA Stock Sinks After Report
In after-hours trading on the stock market today, AMBA stock sank 6.3% to 88.40. During the regular session Tuesday, AMBA stock rose 2% to close at 94.31.
Ambarella's products are used in a variety of surveillance and computer-vision applications. They include video security, advanced driver-assistance systems, autonomous driving and robotic applications. Ambarella describes itself as "an edge AI semiconductor company."
On Dec. 2, AMBA stock broke out of a cup-with-handle base at a buy point of 76.70, according to IBD MarketSmith charts.
AMBA stock ranks No. 17 out of 34 stocks in IBD's fabless semiconductor industry group, according to IBD Stock Checkup. Further, it has a middling IBD Composite Rating of 66 out of 99.
IBD's Composite Rating combines five separate proprietary ratings into one easy-to-use rating. The best growth stocks have a Composite Rating of 90 or better.
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