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QuickLogic (QUIK) to Report Q1 Earnings: What's in Store?

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QuickLogic Corporation QUIK is set to report first-quarter 2018 results on May 9. Notably, the company’s earnings have surpassed the Zacks Consensus Estimate in one of the four trailing quarters, recording an average positive surprise of 5%.

The company’s adjusted loss of 4 cents per share in the last reported quarter, came in line with the Zacks Consensus Estimate but narrower than the year-ago quarter’s loss of 5 cents per share.

Revenues of $3 million were flat on a year-over-year basis and also met the Zacks Consensus Estimate.

What to Expect?

The Zacks Consensus Estimate for revenues is currently pegged at $3 million, down 5.4% year over year. While the Zacks Consensus Estimate for earnings is pegged at a loss of 4 cents.

Let's see how things are shaping up for this announcement.

Factors to Consider

Growing adoption of QuikLogic’s sensor processing solutions and embedded FPGA (eFPGA) Intellectual Property (IP) Licensing is a tailwind. The company’s new support center in Taiwan related to eFPGA IP has also aided it in developing relationships with prospective customers, which can eventually lead to design wins.

Recently, the company’s test-chip qualification for SMIC low power 40 nanometer processes was completed. In order to expand presence in the Chinese market, QuickLogic signed a partnership agreement with AcconSys, a prominent EDA tool and semiconductor IP distributor in China. The latter will provide the company’s flagship ArcticPro embedded FPGA solutions with sales and support services in China. The deal is expected to act as a catalyst.

Notably, QuickLogic was granted a patent for Flexible Fusion Engine (“FFE”), which is used for always-on sensor processing in the EOS S3 multi-core processor, by the United States Patent and Trademark Office. The company’s sensor processing segment has witnessed rapid growth driven by its EOS S3 software on a chip (SoC), which has the capability to support always-on/always listening requirement at a very low power consumption level.

As the world is moving toward voice interfaces like Amazon’s AMZN Alexa, Apple’s Siri, Alphabet’s OK Google, the need for technology products that run on voice command is also increasing. This is leading to growing demand for this always-on feature in the mobile, wearable, hearable and battery powered IoT products industries.

This new feature is replacing the previously prevalent push-to-talk feature. The hardware architecture used for the push-to-talk feature is not considered apt for the always-on feature as it will consume more battery life. Consequently, QuickLogic’s low power consuming EOS S3 SoC with an integrated Low Power Sound Detector or LPSD is gaining wide acceptance in this scenario.

The company is witnessing increasing demand for wearable products in the B2B market, primarily driven by higher demand from hospitals and fitness focused companies, which need to track body activities and biometric information.

The smartphone market also raises optimism. It is currently working with a Japanese smartphone OEM, which is expected to adopt QuickLogic’s EOS S3 SoC for its new models scheduled to be launched in 2018.

QuickLogic Corporation Price and EPS Surprise

QuickLogic Corporation Price and EPS Surprise | QuickLogic Corporation Quote

What Our Model Says

According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a good chance of beating estimates if it also has a positive Earnings ESP. The sell-rated stocks (Zacks Rank #4 or 5) are best avoided. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Quick Logic has a Zacks Rank #3 and an Earnings ESP of 0.00%.

Stocks With Favorable Combination

Here are a couple of companies which, as per our model, have the right combination of elements to post an earnings beat this quarter:

Yelp Inc. YELP has an Earnings ESP of +18.45% and a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.

HubSpot, Inc. HUBS has an Earnings ESP of +5.60% and a Zacks Rank of 3.

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