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Earnings Review and Free Research Report: Ambarella’s Revenue Gained 10%

Friday, 22 September 2017 07:20 AM

Pro-Trader Daily

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LONDON, UK / ACCESSWIRE / September 22, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on Ambarella, Inc. (NASDAQ: AMBA), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=AMBA, following the Company's announcement of its second quarter fiscal 2018 financial results on August 31, 2017. The video-compression chipmaker outperformed top- and bottom-line expectations and it also provided guidance for the upcoming quarter. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at:

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At Pro-TD, we make it our mission to bring you news that matter about the stock you follow. Today, our research desk covers a blog story on AMBA. With the links below you can directly download the report of your stock of interest free of charge at:

http://protraderdaily.com/optin/?symbol=AMBA

Earnings Reviewed

For its second quarter of the fiscal year 2018 ended July 31, 2017, Ambarella's revenue grew 10.0% to $71.6 million compared to $65.1 million in Q2 FY17. The Company's revenues in the reported quarter, excluding sales to GoPro and their ODMs grew 16.3% on a y-o-y basis, finishing at $67.9 million. Ambarella's revenue numbers topped analysts' expectations of $70.8 million.

During Q2 FY18, Ambarella's gross margin under U.S. GAAP was 62.6%, compared with 66.7% for Q2 FY17. Gross margin on a non-GAAP basis for the second quarter of fiscal 2018 was 63.0%, compared with 67.1% for the same period in fiscal 2017.

Ambarella's GAAP net income for Q2 FY18 was $3.3 million, or $0.10 per diluted ordinary share, compared with GAAP net income of $8.6 million, or $0.25 per diluted ordinary share, for Q2 FY17. The Company's non-GAAP net income for the reported quarter was $16.5 million, or $0.48 per diluted ordinary share, as compared to non-GAAP net income of $18.5 million, or $0.54 per diluted ordinary share, for the year-ago period. The Company's results exceeded Wall Street estimates of $0.45 per share.

Ambarella's total headcount at the end of Q2 FY18 was 680 compared to 672 at the end of Q1 FY18, with approximately 82% of employees dedicated to engineering. Approximately 72% of the Company's total headcount is located in Asia, primarily in Taiwan and China.

Cash Matters

Ambarella ended Q2FY18 with cash and marketable securities of $400.8 million, adding $10.6 million of cash from operations in the reported quarter. The reduction in cash in the reported quarter compared to the prior quarter was primarily the result of the Company's repurchase of 595,770 shares at an average price of $50.25 for total consideration of approximately $29.9 million. Ambarella's total accounts receivable at the end of Q2 FY18 was $38.4 million, or 49 days sales outstanding, compared to accounts receivable of $22.9 million, or 32 days sales outstanding at the end of the prior quarter. Accounts receivable increased due to the timing of shipments in the reported quarter.

Ambarella's net inventory at the end of Q2 FY18 was $17.7 million, or about 63 days of inventory, compared to $19.1 million, or 77 days of inventory, at the end of Q1 FY17.

In Q2 FY18, Ambarella repurchased a total of 595,770 shares for total consideration of approximately $29.9 million. Of the total shares repurchased in the reported quarter, 551,351 shares were purchased under the $75 million repurchase program that ended on June 30, 2017. Ambarella repurchased a total of 1,119,178 shares from the inception of the $75 million program for total cash consideration of approximately $56.7 million. Under the new $50 million repurchase program that was announced in June 2017 and commenced on July 1st, 2017, Ambarella repurchased a total of 44,419 ordinary shares in Q2 FY18 for total cash consideration of approximately $2.2 million.

Outlook

For the third quarter of the fiscal year 2018, ending October 31, 2017, Ambarella is forecasting revenue to be between $87.5 million and $90.5 million; gross margin on a non-GAAP basis to be between 62.0% and 63.5%, and operating expenses on a non-GAAP basis to at around $28.0 million.

Stock Performance

On Thursday, September 21, Ambarella's stock closed the trading session at $45.83, slightly down 0.69% from its previous closing price of $46.15. A total volume of 1.00 million shares were exchanged during the session. Shares of the Company have a PE ratio of 29.78 and currently have a market cap of $1.49 billion.

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