Q4 Earnings Outperformers: Lattice Semiconductor (NASDAQ:LSCC) And The Rest Of The Processors and Graphics Chips Stocks
The end of an earnings season can be a great time to assess how companies are handling the current business environment and discover new stocks. Let’s take a look at how Lattice Semiconductor (NASDAQ:LSCC) and the rest of the processors and graphics chips stocks fared in Q4.
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 solid Q4; on average, revenues beat analyst consensus estimates by 2.1% while next quarter's revenue guidance was 3.9% below consensus. Stocks have been under pressure as inflation (despite slowing) makes their long-dated profits less valuable, but processors and graphics chips stocks held their ground better than others, with the share prices up 11.8% on average since the previous earnings results.
Weakest Q4: 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 $170.6 million, down 3% year on year, falling short of analyst expectations by 3.3%. It was a weak quarter for the company, with underwhelming revenue guidance for the next quarter and a miss of analysts' revenue estimates.
Jim Anderson, president and CEO, said, "We achieved double-digit annual revenue growth in 2023, with record gross margin and continued profit expansion. Despite near-term cyclical industry headwinds, we continue to be well positioned for the long-term with a rapidly expanding product portfolio and strong customer momentum. "
Lattice Semiconductor delivered the weakest performance against analyst estimates of the whole group. The stock is up 12.1% since the results and currently trades at $79.55.
Is now the time to buy Lattice Semiconductor? Access our full analysis of the earnings results here, it's free.
Best Q4: Nvidia (NASDAQ:NVDA)
Founded in 1993 by Jensen Huang and two former Sun Microsystems engineers, Nvidia (NASDAQ:NVDA) is a leading fabless designer of chips used in gaming, PCs, data centers, automotive, and a variety of end markets.
Nvidia reported revenues of $22.1 billion, up 265% year on year, outperforming analyst expectations by 7.6%. It was a stunning quarter for the company, with a meaningful revenue beat, strong gross margin improvement, and EPS outperformance vs. Wall Street's estimates. Guidance for the next quarter was also good, with revenue, gross margin, and implied operating profit coming in ahead of expectations.
Nvidia delivered the biggest analyst estimates beat and fastest revenue growth among its peers. The stock is up 32.9% since the results and currently trades at $897.09.
Is now the time to buy Nvidia? Access our full analysis of the earnings results here, it's free.
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 $255 million, up 2.5% year on year, falling short of analyst expectations by 0.7%. It was a weaker quarter for the company, with underwhelming revenue guidance for the next quarter and a decline in its gross margin.
The stock is up 4.1% since the results and currently trades at $27.
Read our full analysis of Allegro MicroSystems's results here.
Qualcomm (NASDAQ:QCOM)
Having been at the forefront of developing the standards for cellular connectivity for over four decades, Qualcomm (NASDAQ:QCOM) is a leading innovator and a fabless manufacturer of wireless technology chips used in smartphones, autos and internet of things appliances.
Qualcomm reported revenues of $9.94 billion, up 5% year on year, surpassing analyst expectations by 4.4%. It was a strong quarter for the company, with a significant improvement in its inventory levels and an impressive beat of analysts' EPS estimates.
The stock is up 13.6% since the results and currently trades at $168.8.
Read our full, actionable report on Qualcomm here, it's free.
AMD (NASDAQ:AMD)
Founded in 1969 by a group of former Fairchild semiconductor executives led by Jerry Sanders, Advanced Micro Devices or AMD (NASDAQ:AMD) is one of the leading designers of computer processors and graphics chips used in PCs and data centers.
AMD reported revenues of $6.17 billion, up 10.2% year on year, in line with analyst expectations. It was a slower quarter for the company, with underwhelming revenue guidance for the next quarter and a miss of analysts' EPS estimates.
The stock is up 3.9% since the results and currently trades at $178.61.
Read our full, actionable report on AMD here, it's free.
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