Looking back on processors and graphics chips stocks' Q2 earnings, we examine this quarter’s best and worst performers, including Broadcom (NASDAQ:AVGO) and its peers.
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 6 processors and graphics chips stocks we track reported a weaker Q2; on average, revenues missed analyst consensus estimates by 2%, while on average next quarter revenue guidance was 5.98% under consensus. Tech stocks have been hit the hardest as investors start to value profits over growth and processors and graphics chips stocks have not been spared, with share price down 20.1% since the previous earnings results, on average.
Broadcom (NASDAQ:AVGO)
Originally the semiconductor division of Hewlett Packard, Broadcom (NASDAQ:AVGO) is a semiconductor conglomerate that spans wireless, networking, data storage, and industrial end markets along with an infrastructure software business focused on mainframes and cybersecurity.
Broadcom reported revenues of $8.46 billion, up 24.8% year on year, in line with analyst expectations. It was a mixed quarter for the company, with a strong sales guidance for the next quarter but an increase in inventory levels.
"Broadcom's record third quarter results were driven by robust demand across cloud, service providers, and enterprise," said Hock Tan, President and CEO of
The stock is down 2.37% since the results and currently trades at $480.45.
Is now the time to buy Broadcom? Access our full analysis of the earnings results here, it's free.
Best Q2: 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 $6.55 billion, up 70.1% year on year, in line with analyst expectations. It was a decent quarter for the company, with a significant improvement in gross margin but an underwhelming revenue guidance for the next quarter.
AMD delivered the fastest revenue growth and highest full year guidance raise among its peers. The stock is down 25.7% since the results and currently trades at $73.70.
Is now the time to buy AMD? Access our full analysis of the earnings results here, it's free.
Weakest Q2: Intel (NASDAQ:INTC)
Inventor of the x86 processor that powered decades of technological innovation in PCs, data centers, and numerous other markets, Intel (NASDAQ: INTC) is the leading manufacturer of computer processors and graphics chips.
Intel reported revenues of $15.3 billion, down 22% year on year, missing analyst expectations by 14.5%. It was a weak quarter for the company, with guidance for both the next quarter and the full year missing analysts' expectations.
Intel had the weakest performance against analyst estimates, slowest revenue growth, and weakest full year guidance update in the group. The stock is down 28.5% since the results and currently trades at $28.38.
Read our full analysis of Intel's results here.
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 $6.7 billion, up 3.02% year on year, in line with analyst expectations. It was a weak quarter for the company, with an underwhelming revenue guidance for the next quarter and a decline in operating margin.
The stock is down 23.9% since the results and currently trades at $130.84.
Read our full, actionable report on Nvidia here, it's free.
Qorvo (NASDAQ:QRVO)
Formed by the merger of TriQuint and RF Micro Devices, Qorvo (NASDAQ: QRVO) is a designer and manufacturer of RF chips used in almost all smartphones globally, along with a variety of chips used in networking equipment and infrastructure.
Qorvo reported revenues of $1.03 billion, down -6.76% year on year, in line with analyst expectations. It was a weaker quarter for the company, with a slow revenue growth and a decline in gross margin.
The stock is down 21.1% since the results and currently trades at $84.20.
Read our full, actionable report on Qorvo here, it's free.
The author has no position in any of the stocks mentioned