Semtech (SMTC) Q2 Earnings Beat, Sales Miss, Guidance Weak
Zacks Investment Research | Aug 30, 2017 11:24PM ET
Semtech Corporation (NASDAQ:SMTC) reported mixed fiscal second-quarter 2018 results with earnings beating the Zacks Consensus Estimate but revenues missing the same. While non-GAAP earnings of 48 cents beat the consensus mark by 2 cents, revenues missed the same by $3 million. Earnings increased 9.1% sequentially and 37.1% year over year.
Shares, however, plunged 13.6% in after-hour trading following weak top-line guidance for the current quarter. Revenues are expected in the range of $145.0 million to $153.0 million that implies 2.7% sequential decline at the mid-point of the guided range.
Over the last year, shares have gained 35%, significantly outperforming the industry’s 29.3% rally.
The company’s improved profitability was driven by Semtech’s differentiated growth drivers and diversification strategy. Key growth drivers for Semtech are product differentiation, operational flexibility and a specific focus on fast-growing segments and regions.
In the quarter, Semtech acquired AptoVision, a privately held company that provides algorithms for transporting video over Internet protocol (IP). The acquisition is expected to strengthen Semtech’s position in the video over IP Pro AV space. The company expects this acquisition to contribute roughly $2 million to fiscal 2018 revenues and be neutral to fiscal 2018 non-GAAP results.
The numbers in detail.
Revenues in Detail
Semtech’s total revenue of $153.1 million was up 6% sequentially and 13% year over year and was wihin the guided range of $147 and $157 million. The upside was driven by strong demand for the company’s enterprise computing, high-end consumer and industrial end-markets, partially offset by weakness in the communications markets.
Semtech Corporation Price, Consensus and EPS Surprise
Zacks Investment Research
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.