Ambarella Inc. (AMBA)
NASDAQ:AMBA
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Ambarella
(NASDAQ:AMBA)
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Rating:63Neutral
Price Target:
$83.00
▲(42.54% Upside)
Action:Reiterated
Date:06/03/26
AMBA scores highest on balance-sheet strength and constructive earnings-call outlook (sequentially improving guidance, strong automotive momentum, and long-term design-win/LTA potential). The overall score is held back by still-weak TTM profitability, cash-flow volatility and recent quarterly cash outflows/inventory build, and a valuation profile constrained by negative earnings; technicals are mixed with near-term softness but longer-term support.
Positive Factors
Conservative balance sheet and cash buffer
Very low leverage and substantial liquid resources provide durable financial flexibility. Cash and marketable securities (~$278M reported) support R&D, product ramps, LTA fulfillment, and buybacks while limiting refinancing risk, enabling multi‑year execution even through cyclical downturns.
Negative Factors
High customer/channel concentration
Extremely high concentration in one fulfillment partner increases revenue volatility and negotiation risk. A single channel disruption, pricing pressure, or order timing change could produce outsized swings in shipments and revenue despite diversified end markets and product wins.
Read all positive and negative factors
Positive Factors
Negative Factors
Conservative balance sheet and cash buffer
Very low leverage and substantial liquid resources provide durable financial flexibility. Cash and marketable securities (~$278M reported) support R&D, product ramps, LTA fulfillment, and buybacks while limiting refinancing risk, enabling multi‑year execution even through cyclical downturns.
Read all positive factors
Ambarella Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down revenue across different regions, revealing where Ambarella is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Breaks down revenue across different regions, revealing where Ambarella is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
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The Fly
The FlyAmbarella (AMBA) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.44B
Dividend YieldN/A
Average Volume (3M)1.29M
Price to Earnings (P/E)―
Beta (1Y)1.87
Revenue Growth28.12%
EPS Growth34.98%
CountryUS
Employees941
SectorTechnology
Sector Strength88
IndustrySemiconductors
Share Statistics
EPS (TTM)-1.61
Shares Outstanding43,861,485
10 Day Avg. Volume2,129,408
30 Day Avg. Volume1,291,561
Financial Highlights & Ratios
PEG Ratio0.97
Price to Book (P/B)4.60
Price to Sales (P/S)7.00
P/FCF Ratio47.15
Enterprise Value/Market Cap0.89
Enterprise Value/Revenue7.56
Enterprise Value/Gross Profit12.98
Enterprise Value/Ebitda-55.91
Forecast
1Y Price Target
$101.56Price Target Upside74.40% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering11
EPS Forecast (FY)0.81
Revenue Forecast (FY)$443.13M
Ambarella Business Overview & Revenue Model
Company Description
Ambarella, Inc. develops semiconductor solutions for video that enable high-definition (HD) and ultra HD compression, image processing, and deep neural network processing worldwide. The company's system-on-a-chip designs integrated HD video proces...
How the Company Makes Money
Ambarella primarily makes money by selling semiconductor products—mainly SoCs (and associated software/firmware support) that customers integrate into their own hardware products (e.g., AI/vision cameras, automotive camera and sensing modules, and...
Ambarella Earnings Call Summary
Earnings Call Date:May 28, 2026
(Q1-2027)
| % Change Since: |
Next Earnings Date:Sep 01, 2026
Earnings Call Sentiment Positive
The call emphasized clear execution and strong secular momentum: revenue grew 16.9% YoY, automotive set a record quarter with steep product ramps, major LTAs (including an $800M+ potential Hanwha deal) and extensive design‑win momentum support a constructive growth outlook. However, the company is managing near‑term headwinds including a sizable inventory build (days inventory up from 99 to 145), sequential cash outflows, customer/fulfillment concentration (WT Microelectronics ~60.7% of revenue), supply‑chain pressures on DRAM/flash, and a double‑digit sequential decline in consumer IoT. On balance, the positives (product road map, LTAs, YoY growth, margins, design wins and guidance for Q2 expansion) materially outweigh the near‑term operational and concentration risks.Positive Updates
Revenue Beat and Strong Year‑Over‑Year Growth
Q1 revenue of $100.0M was slightly above the midpoint of guidance, down 0.5% sequentially but up 16.9% year‑over‑year.
Negative Updates
Inventory Build and Cash Outflows
Days of inventory rose from 99 to 145 (increase of 46 days, ~46%); cash and marketable securities decreased by $34.8M sequentially to $278M; operating cash outflow of $25.6M and free cash outflow of $29.6M for the quarter.
Read all updates
Q1-2027 Updates
Positive
Negative
Revenue Beat and Strong Year‑Over‑Year Growth
Q1 revenue of $100.0M was slightly above the midpoint of guidance, down 0.5% sequentially but up 16.9% year‑over‑year.
Read all positive updates
Company Guidance
Ambarella guided Q2 FY27 revenue of $105–$111M (midpoint $108M) versus Q1 revenue of $100M (slightly above prior midpoint); Q2 non‑GAAP gross margin is forecast at 59.0%–60.5% (Q1 was 59.9%) and non‑GAAP operating expense is guided to $56–$59M (Q1 $56.4M); net interest and other income is estimated at $1.9M (Q1 $2.1M), non‑GAAP tax about $800K (Q1 ~$740K), and diluted shares ~44.3M. Management reiterated a long‑term gross‑margin model of roughly 59%–62% and a full‑year growth outlook near 10%–15%; balance‑sheet and cash metrics for Q1 included cash & marketable securities of ~$278M, operating cash outflow $25.6M, capex $4M, free cash outflow $29.6M, DSO 35 days and inventory days rising to 145 (from 99). Additional disclosed metrics tied to strategy and potential revenue sources included cumulative SoC shipments >46M, 12 Edge AI SoCs available, corporate ASP ~$15 in Q1 (with new SoCs targeting higher ASPs), a Hanwha LTA with potential revenue in excess of $800M over >10 years, 15+ robotic design wins with lifetime revenue >$100M, and a new $50M share repurchase authorization (following a recent buyback of 47.8k shares for $2.4M at an average $51.04).Ambarella Financial Statement Overview
Summary
Income Statement
44
Neutral
Balance Sheet
86
Very Positive
Cash Flow
70
Positive
| Breakdown | TTM | Jan 2026 | Jan 2025 | Jan 2024 | Jan 2023 | Jan 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 405.19M | 390.70M | 284.87M | 226.47M | 337.61M | 331.86M |
| Gross Profit | 236.13M | 226.47M | 167.63M | 136.82M | 208.93M | 208.13M |
| EBITDA | -54.81M | -56.94M | -100.53M | -129.75M | -54.32M | -15.64M |
| Net Income | -69.63M | -75.86M | -117.13M | -169.42M | -65.39M | -26.41M |
Balance Sheet | ||||||
| Total Assets | 794.84M | 798.60M | 688.97M | 657.65M | 710.20M | 657.54M |
| Cash, Cash Equivalents and Short-Term Investments | 277.80M | 312.57M | 250.26M | 219.93M | 206.86M | 171.04M |
| Total Debt | 13.27M | 13.44M | 5.26M | 5.34M | 8.64M | 11.71M |
| Total Liabilities | 189.02M | 203.81M | 127.56M | 97.78M | 104.11M | 110.37M |
| Stockholders Equity | 605.82M | 594.79M | 561.41M | 559.87M | 606.09M | 547.18M |
Cash Flow | ||||||
| Free Cash Flow | 30.19M | 58.01M | 23.45M | 7.05M | 29.04M | 29.12M |
| Operating Cash Flow | 33.09M | 73.52M | 33.84M | 19.02M | 44.09M | 38.80M |
| Investing Cash Flow | -60.63M | -30.49M | -40.53M | 7.84M | -107.30M | -119.55M |
| Financing Cash Flow | 701.00K | 3.81M | 6.40M | 4.51M | 5.70M | 10.53M |
Ambarella Technical Analysis
Positive
58.23
Price Trends
66.83
Positive
64.75
Positive
72.30
Positive
Market Momentum
3.94
Positive
51.64
Neutral
17.22
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AMBA, the sentiment is Positive. The current price of 58.23 is below the 20-day moving average (MA) of 80.73, below the 50-day MA of 66.83, and below the 200-day MA of 72.30, indicating a neutral trend. The MACD of 3.94 indicates Positive momentum. The RSI at 51.64 is Neutral, neither overbought nor oversold. The STOCH value of 17.22 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AMBA.
Ambarella Risk Analysis
Ambarella disclosed 72 risk factors in its most recent earnings report. Ambarella reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 3 New Risks
1.
We have identified a material weakness in our internal control over financial reporting. Failure to achieve and maintain effective internal control over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act of 2002 could materially and adversely affect our business, results of operations, financial condition, and stock price. Q4, 2023
2.
Climate change and climate change-related policies and regulations may have a long-term impact on our business. Q4, 2023
3.
Uncertain risks relating to the adoption, use or application of emerging technologies, including artificial intelligence, by our customers and in our business, could adversely impact our financial results and result in reputational harm and liability. Q4, 2023
Ambarella Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $10.11B | 14.92 | 20.24% | 2.22% | 36.05% | 80.83% | |
71 Outperform | $4.69B | 281.46 | 2.44% | 2.27% | 3.11% | -54.05% | |
65 Neutral | $8.59B | 180.86 | 7.68% | ― | 10.70% | -62.92% | |
65 Neutral | $7.21B | -143.26 | -4.66% | ― | 25.14% | 70.00% | |
63 Neutral | $3.44B | -49.08 | -11.77% | ― | 28.12% | 34.98% | |
62 Neutral | $5.64B | -117.80 | -3.47% | ― | 12.81% | -129.65% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
AMBA
Ambarella
78.38
24.51
45.50%
CAMT
Camtek
187.52
119.48
175.60%
POWI
Power Integrations
84.19
34.16
68.29%
SLAB
Silicon Laboratories
218.75
93.63
74.83%
SIMO
Silicon Motion
301.27
237.45
372.04%
SYNA
Synaptics
146.04
83.98
135.32%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.