Advanced Energy (AVX) AI Stock Analysis

Company Guidance

Advanced Energy forecasts fourth quarter revenue to be approximately $735 million, plus or minus $25 million, with Q4 gross margin in the 42% to 42.5% range, operating expenses of $126 million to $128 million, other income of approximately $8 million, a tax rate in the 16% range, and non-GAAP earnings per share of $3.90, plus or minus $0.30 on 41.2 million shares outstanding. For 2026, total revenue is expected to grow around 40%, Semiconductor revenue is projected to grow over 60% year-on-year in the second half, semiconductor product revenue, excluding service, is expected to grow by around 45%, Data Center revenue growth is expected to be in the high 50% range, and capital investments are expected to be towards the low end of the $180 million to $195 million range. The company expects inventory turns to remain around 2.5x over the next few quarters, 2027 revenue growth to be robust, earnings per share to grow faster than revenue, and service to grow in that mid-single digits to 10% every year pretty much; directionally, 2027 growth is around 30%, though demand growth could likely be higher, with some uncertainty regarding supply. Gross margin is on track to reach and eventually surpass the target of over 43%, and total revenue-generating capacity is expected to expand to over $5 billion by the end of 2028.