As semiconductor manufacturing stocks’ Q2 earnings season wraps, let's dig into this quarter's best and worst performers, including Semtech (NASDAQ:SMTC) and its peers.
The semiconductor industry is driven by demand for advanced electronic products like smartphones, PCs, servers, and data storage. The need for technologies like artificial intelligence, 5G networks, and smart cars is also creating the next wave of growth for the industry. Keeping up with this dynamism requires new tools that can design, fabricate, and test chips at ever smaller sizes and more complex architectures, creating a dire need for semiconductor capital manufacturing equipment.
The 14 semiconductor manufacturing stocks we track reported a slower Q2; on average, revenues were in line with analyst consensus estimates while next quarter's revenue guidance was 1.39% below consensus. Tech stocks have been under pressure as inflation makes their long-dated profits less valuable, and semiconductor manufacturing stocks have not been spared, with share prices down 10.6% on average, since the previous earnings results.
Operating for more than 60 years, Semtech (NASDAQ:SMTC) is a provider of analog and mixed-signal semiconductors used for Internet of Things systems and cloud connectivity.
Semtech reported revenues of $238.4 million, up 13.9% year on year, in line with analyst expectations. It was a weaker quarter for the company, with underwhelming revenue guidance for the next quarter and a decline in its operating margin.
“In the recent quarter, our net sales aligned with our projections and our non-GAAP gross margin and earnings per share each exceeded our estimates, largely due to focused cost-saving initiatives,” said Paul H. Pickle, Semtech’s president and chief executive officer.
The stock is down 5.99% since the results and currently trades at $21.49.Is now the time to buy Semtech? Read our full report on Semtech here.
Best Q2: Applied Materials (NASDAQ:AMAT)Founded in 1967 as the first company to develop tools for other businesses in the semiconductor industry, Applied Materials (NASDAQ: AMAT) is the largest provider of semiconductor wafer fabrication equipment.
Applied Materials reported revenues of $6.43 billion, down 1.46% year on year, outperforming analyst expectations by 4.29%. It was a very strong quarter for the company, with an impressive beat of analysts' EPS estimates and optimistic revenue guidance for the next quarter.
Applied Materials achieved the biggest analyst estimates beat among its peers. The stock is up 2.71% since the results and currently trades at $141.12.
Is now the time to buy Applied Materials? Access our full analysis of the earnings results here, it's free.
Weakest Q2: IPG Photonics (NASDAQ:IPGP)
Both a designer and manufacturer of its products, IPG Photonics (NASDAQ:IPGP) is a provider of high-performance fiber lasers that are used for cutting, welding and processing raw materials.
IPG Photonics reported revenues of $340 million, down 9.83% year on year, falling short of analyst expectations by 1.79%. It was a weak quarter for the company, with underwhelming revenue guidance for the next quarter and a miss of analysts' revenue estimates.
The stock is down 27.8% since the results and currently trades at $94.89.
KLA Corporation (NASDAQ:KLAC)
Formed by the 1997 merger of the two leading semiconductor yield management companies, KLA Corporation (NASDAQ:KLAC) is the leading supplier of equipment used to measure and inspect semiconductor chips.
KLA Corporation reported revenues of $2.36 billion, down 5.29% year on year, surpassing analyst expectations by 4.19%. It was a very strong quarter for the company, with an impressive beat of analysts' EPS estimates.
The stock is up 1.95% since the results and currently trades at $492.02.
Kulicke and Soffa (NASDAQ:KLIC)
Headquartered in Singapore, Kulicke & Soffa (NASDAQ: KLIC) is a provider of production equipment and tools used to assemble semiconductor devices
Kulicke and Soffa reported revenues of $190.9 million, down 48.7% year on year, in line with analyst expectations. It was a slower quarter for the company, with underwhelming revenue guidance for the next quarter and a decline in its operating margin.
Kulicke and Soffa had the slowest revenue growth among its peers. The stock is down 16.8% since the results and currently trades at $45.89.
Join Paid Stock Investor Research
Help us make StockStory more helpful to investors like yourself. Join our paid user research session and receive a $50 Amazon gift card for your opinions. Sign up here.
The author has no position in any of the stocks mentioned