As the Q3 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the processors and graphics chips industry, including Lattice Semiconductor (NASDAQ:LSCC) 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 very strong Q3. As a group, revenues beat analysts’ consensus estimates by 2.7% while next quarter’s revenue guidance was 12,447% above.
In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.
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 $133.3 million, up 4.9% year on year. This print was in line with analysts’ expectations, but overall, it was a mixed quarter for the company with a significant improvement in its inventory levels but a miss of analysts’ adjusted operating income estimates.
Ford Tamer, Chief Executive Officer, said, "We delivered a strong quarter, with broad-based growth across our end markets, and grew non-GAAP earnings 17% quarter over quarter. Our Communications and Computing business achieved record revenue, and we are expecting continued growth into the fourth quarter and beyond. We continue to drive operating leverage and expand profitability, with significant revenue and non-GAAP EPS growth of 13% and 29%, respectively, expected in the second half of 2025 compared to the first half of 2025. "
Lattice Semiconductor delivered the weakest performance against analyst estimates of the whole group. Interestingly, the stock is up 19.5% since reporting and currently trades at $85.34.
Is now the time to buy Lattice Semiconductor? Access our full analysis of the earnings results here, it’s free.
Best Q3: Penguin Solutions (NASDAQ:PENG)
Based in the US, Penguin Solutions (NASDAQ:PENG) is a diversified semiconductor company offering memory, digital, and LED products.
Penguin Solutions reported revenues of $343.1 million, flat year on year, outperforming analysts’ expectations by 1.2%. The business had an exceptional quarter with a significant improvement in its inventory levels and a beat of analysts’ EPS estimates.
Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 6.3% since reporting. It currently trades at $20.29.
Is now the time to buy Penguin Solutions? Access our full analysis of the earnings results here, it’s free.
Weakest Q3: 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 $214.3 million, up 14.4% year on year, exceeding analysts’ expectations by 1.4%. Still, it was a mixed quarter as it posted EPS in line with analysts’ estimates.
Interestingly, the stock is up 4.9% since the results and currently trades at $32.25.
Read our full analysis of Allegro MicroSystems’s results here.
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 $1.06 billion, up 1.1% year on year. This result topped analysts’ expectations by 1.9%. It was an exceptional quarter as it also put up a significant improvement in its inventory levels and revenue guidance for next quarter exceeding analysts’ expectations.
The stock is down 14.2% since reporting and currently trades at $81.37.
Read our full, actionable report on Qorvo here, it’s free.
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 $11.27 billion, up 10% year on year. This number surpassed analysts’ expectations by 4.8%. Overall, it was an exceptional quarter as it also recorded a significant improvement in its inventory levels and revenue guidance for next quarter exceeding analysts’ expectations.
The stock is down 4.9% since reporting and currently trades at $164.48.
Read our full, actionable report on Qualcomm here, it’s free.
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