When Will Arbe Robotics Ltd. (NASDAQ:ARBE) Turn A Profit?
With the business potentially at an important milestone, we thought we'd take a closer look at Arbe Robotics Ltd.'s (NASDAQ:ARBE) future prospects. Arbe Robotics Ltd., a semiconductor company, provides 4D imaging radar solutions for tier 1 automotive suppliers and automotive manufacturers in China, Sweden, Germany, Switzerland, the United States, Italy, and Israel. On 31 December 2022, the US$214m market-cap company posted a loss of US$40m for its most recent financial year. The most pressing concern for investors is Arbe Robotics' path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.
View our latest analysis for Arbe Robotics
According to the 5 industry analysts covering Arbe Robotics, the consensus is that breakeven is near. They expect the company to post a final loss in 2024, before turning a profit of US$13m in 2025. Therefore, the company is expected to breakeven roughly 2 years from now. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 73% is expected, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.
Given this is a high-level overview, we won’t go into details of Arbe Robotics' upcoming projects, but, take into account that by and large a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
One thing we’d like to point out is that Arbe Robotics has no debt on its balance sheet, which is rare for a loss-making growth company, which usually has a high level of debt relative to its equity. The company currently operates purely off its shareholder funding and has no debt obligation, reducing concerns around repayments and making it a less risky investment.
Next Steps:
There are key fundamentals of Arbe Robotics which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Arbe Robotics, take a look at Arbe Robotics' company page on Simply Wall St. We've also put together a list of pertinent factors you should further research:
Historical Track Record: What has Arbe Robotics' performance been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Arbe Robotics' board and the CEO’s background.
Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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