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Q1 Earnings Highlights: Western Digital Corporation (NASDAQ:WDC) Vs The Rest Of The Semiconductors Stocks


Jabin Bastian /
2022/07/07 4:16 am EDT
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Earnings results often give us a good indication of what direction the company will take in the months ahead. With Q1 now behind us, let’s have a look at Western Digital Corporation (NASDAQ:WDC) and its peers.

The semiconductor industry is driven by cyclical demand for advanced electronic products like smartphones, PCs, servers and data storage. While analog chips serve as the building blocks of most electronic goods and equipment, processors (CPUs) and graphics chips serve as their brains. The growth of data and technologies like artificial intelligence, 5G, Internet of Things and smart cars are creating a next wave of secular growth for the industry.

The 22 semiconductors stocks we track reported a mixed Q1; on average, revenues beat analyst consensus estimates by 1.77%, while on average next quarter revenue guidance was 0.68% under consensus. There has been a stampede out of high valuation technology stocks and while some of the semiconductors stocks have fared somewhat better, they have not been spared, with share price declining 13% since earnings, on average.

Western Digital Corporation (NASDAQ:WDC)

Founded in 1970 by a Motorola employee, Western Digital (NASDAQ: WDC) is a leading producer of hard disk drives, SSDs and flash memory.

Western Digital Corporation reported revenues of $4.38 billion, up 5.89% year on year, beating analyst expectations by 1.05%. Despite the weak top-line growth, it was a solid quarter for the company, with a beat on the bottom line and a significant improvement in operating margin.

"The entire Western Digital team worked together to deliver excellent financial performance while navigating a dynamic geopolitical and macroeconomic environment, as well as ongoing supply challenges. This has all been made possible by the operational and portfolio improvements we have made over the last couple of years, which enable us to unlock the earnings power of the Western Digital model,” said David Goeckeler, Western Digital CEO.

Western Digital Corporation Total Revenue

The stock is down 15.8% since the results and currently trades at $44.27.

Is now the time to buy Western Digital Corporation? Access our full analysis of the earnings results here, it's free.

Best Q1: 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 $5.88 billion, up 70.8% year on year, beating analyst expectations by 6.47%. It was an impressive quarter for the company, with a beat on the bottom line and a significant improvement in operating margin.

AMD Total Revenue

AMD pulled off the strongest analyst estimates beat and highest full year guidance raise among its peers. The stock is down 16% since the results and currently trades at $76.49.

Is now the time to buy AMD? Access our full analysis of the earnings results here, it's free.

Weakest Q1: Lam Research (NASDAQ:LRCX)

Founded in 1980 by David Lam, who pioneered semiconductor etching technology, Lam Research (NASDAQ:LCRX) is one of the leading providers of the wafer fabrication equipment used to make semiconductors.

Lam Research reported revenues of $4.06 billion, up 5.52% year on year, missing analyst expectations by 4.33%. It was a weak quarter for the company, with an underwhelming revenue guidance for the next quarter and a miss of the top line analyst estimates.

Lam Research had the weakest performance against analyst estimates in the group. The stock is down 17.4% since the results and currently trades at $398.50.

Read our full analysis of Lam Research'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 $8.28 billion, up 46.4% year on year, beating analyst expectations by 2.38%. Despite the solid top-line results, it was a weaker quarter for the company, with an underwhelming revenue guidance for the next quarter and an increase in inventory levels.

The stock is down 9.49% since the results and currently trades at $153.62.

Read our full, actionable report on Nvidia here, it's free.

Microchip Technology (NASDAQ:MCHP)

Spun out from General Instrument in 1987, Microchip Technology (NASDAQ: MCHP) is a leading provider of microcontrollers and integrated circuits used mainly in the automotive world, especially in electric vehicles and their charging devices.

Microchip Technology reported revenues of $1.84 billion, up 25.7% year on year, beating analyst expectations by 1.4%. It was a strong quarter for the company, with a beat on the bottom line and guidance for the next quarter above analysts' expectations.

The stock is down 11.9% since the results and currently trades at $56.73.

Read our full, actionable report on Microchip Technology here, it's free.

The author has no position in any of the stocks mentioned