As Q4 earnings season comes to a close, it’s time to take stock of this quarter's best and worst performers amongst the processors and graphics chips stocks, 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 9 processors and graphics chips stocks we track reported a weaker Q4; on average, revenues beat analyst consensus estimates by 0.72%, while on average next quarter revenue guidance was 3.36% under consensus. There has been a stampede out of high valuation technology stocks as raising interest rates encourage investors to value profits over growth again, but processors and graphics chips stocks held their ground better than others, with the share prices up 4.91% 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 $8.92 billion, up 15.7% year on year, in line with analyst expectations. It was a mixed quarter for the company, with a significant improvement in inventory levels but a decline in gross margin.
"Broadcom's first quarter performance reflects continued strength in infrastructure demand across all our end markets," said Hock Tan, President and CEO of Broadcom.
The stock is up 4.17% since the results and currently trades at $624.51.
Is now the time to buy Broadcom? Access our full analysis of the earnings results here, it's free.
Best 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 $176 million, up 24.1% year on year, in line with analyst expectations. It was a solid quarter for the company, with a significant improvement in operating margin and revenue guidance for the next quarter above analysts' estimates.
The stock is up 8.06% since the results and currently trades at $89.38.
Is now the time to buy Lattice Semiconductor? Access our full analysis of the earnings results here, it's free.
Weakest Q4: 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 $14 billion, down 31.6% year on year, missing analyst expectations by 3.67%. It was a weak quarter for the company, with declining revenue and underwhelming revenue guidance for the next quarter.
Intel had the weakest performance against analyst estimates in the group. The stock is down 5.49% since the results and currently trades at $28.43.
Read our full analysis of Intel'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 $9.46 billion, down 11.6% year on year, missing analyst expectations by 1.14%. It was a weak quarter for the company, with declining revenue and underwhelming guidance for the next quarter.
The stock is down 14.7% since the results and currently trades at $115.9.
Read our full, actionable report on Qualcomm 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 $248.8 million, up 33.3% year on year, beating analyst expectations by 1.58%. It was a very strong quarter for the company, with a beat on the bottom line.
Allegro MicroSystems scored the fastest revenue growth among the peers. The stock is up 29% since the results and currently trades at $44.4.
Read our full, actionable report on Allegro MicroSystems here, it's free.
The author has no position in any of the stocks mentioned