Allegro MicroSystems (ALGM) Q2 2027 Earnings Report
MX:ALGM Q2 2027 EPS Results
- Actual EPS
- MXN 4.88
- Consensus EPS
- MXN 4.58
- Beat/Miss
- Beat by +MXN 0.30
- One Year Ago EPS
- MXN 2.44
MX:ALGM Q2 2027 Revenue Results
- Actual Revenue
- MXN 5.20B
- Expected Revenue
- MXN 5.09B
- Beat/Miss
- Beat by +MXN 113.17M
- YoY Revenue Growth
- +29.21%
Earnings Announcement Details
- Quarter
- Q2 2027
- Date
- 10/29/2026
- Time
- Before Open
- Conference Call
- Thursday, October 29, 2026
MX:ALGM Upcoming Earnings
Allegro MicroSystems's next earnings date is estimated for February 2, 2027, based on past reporting schedules.
Q2 2027 Earnings Call Audio
MX:ALGM Q2 2027 Earnings Call
0:00 / 0:00
Q2 2027 Earnings Slide Deck
Q2 2027 Earnings Call Summary
Earnings Call Sentiment|Positive
The call was strongly positive. Allegro reported record sales, accelerating bookings and design wins, broad automotive and industrial growth, record data center revenue, expanding robotics and energy-infrastructure opportunities, improving margins, positive free cash flow, and debt reduction. The main challenges were lean automotive inventories, some back-end test constraints, ongoing input-cost inflation, and data center program timing that caused more muted sequential growth, but management characterized the delays as timing-related and maintained an optimistic outlook.
Company Guidance
For fiscal Q3 2027, Allegro expects sales to be in the range of $278 million-$288 million, with the midpoint equating to a 23% year-over-year increase; non-GAAP gross margin is expected to be between 51.5% and 52.5%, operating expenses are expected to be $87 million ±$1 million, interest expense is projected to be $4 million, the tax rate is expected to be 10%, weighted average diluted share count is estimated at 188 million shares, and non-GAAP EPS is expected to be between $0.25 and $0.29 per share, with the midpoint implying an 80% year-over-year increase. Allegro remains on track to more than double data center sales in fiscal 2027, expects FY 2027 factory automation and robotics revenue to be in a range of 3%-4% of overall sales, and said its target model is mid-teens annual sales growth, with the potential to exceed that number; automotive growth was described as north of 10% and industrial growth as closer to 20%.
- Record Sales and Seventh Consecutive Quarter of Sequential GrowthSecond-quarter sales were $277 million, above the high end of guidance, increasing 7% sequentially and 29% year-over-year. This marked Allegro's seventh consecutive quarter of sequential sales growth.
- Strong EPS Growth and Operating LeverageNon-GAAP EPS was $0.26, up 13% sequentially and 100% year-over-year, while sales increased 7% sequentially and 29% year-over-year. Management cited significant operating leverage in the business model.
- Record Design Wins, Bookings, and Expanding BacklogTotal design wins increased nearly 40% year-over-year, reaching the company's highest quarterly level since its 2020 IPO. Bookings increased for the eighth consecutive quarter, rising 45% year-over-year in the CEO's comments and 50% year-over-year in the CFO's comments, with bookings also up 33% sequentially. Backlog continued to expand across automotive and industrial end markets.
- Automotive Growth and Record Design WinsAutomotive sales increased 4% sequentially and 11% year-over-year to $173 million, marking the sixth consecutive quarter of double-digit year-over-year automotive growth. Automotive design wins reached a new record, with more than 75% in xEV and ADAS systems.
- Strategic Automotive Wins and Higher Content OpportunitiesAllegro secured a next-generation onboard charger win using 5 MHz current sensors and a major motor-driver win for a leading North American EV manufacturer's vehicle cooling system. It also won an electronic power steering design with a leading Japanese OEM using safety-grade, high-accuracy magnetic position sensors. Initial product shipments for some of these wins are expected within the next 12 months.
- Growing xEV and ADAS MixMore than 50% of automotive revenue is now in xEV and ADAS, up from about 35% of the overall auto business previously cited by management. Management expects xEV and ADAS to continue diverging from the rest of automotive, supported by an Analyst Day market CAGR of 18% for those segments.
- Electromechanical Braking Content ExpansionManagement stated that dollar content per braking system can increase by roughly 4x when customers transition to electromechanical braking. One customer is already shipping multiple Allegro ICs into one of the world's first vehicles deploying electromechanical braking systems.
- Industrial and Other Revenue Reached a RecordIndustrial and other sales increased 11% sequentially and 79% year-over-year to $104 million, surpassing $100 million for the first time. Growth included magnetic-sensor share gains in medical applications, a boost in personal mobility, and a data-center halo effect on energy infrastructure.
- Record Data Center Revenue and Strong Design-Win MomentumData center sales reached a record $46 million, growing more than 150% year-over-year. Management remains on track to more than double data center sales in fiscal 2027. Current-sensor data center design wins more than doubled sequentially, including more than 10 wins with leading Taiwanese power-supply providers for hyperscaler power supplies, battery backup units, and UPS systems.
- Expansion of Data Center Dollar ContentAllegro is targeting growth in data center dollar content from $150 to more than $425 per rack, with two-thirds of the $425 opportunity expected to come from motor drivers and current sensors. Isolated gate drivers could add hundreds of dollars beyond that amount over time.
- New Data Center Product LaunchesThe company launched higher-isolation current sensors, footprint-shrinking isolated gate drivers, and intelligent 48-volt fan drivers. These products are intended to support higher computing performance without increasing heat, power consumption, or physical size.
- Robotics and Humanoid Design-Win ProgressAllegro secured a design win with a leading Asian robotics developer for high-precision current sensors in humanoid drive joints and another win with a leading Chinese humanoid supplier for inductive position-sensor ICs. The latter program is expected to use approximately 60 ICs per humanoid and ramp to production within six months.
- New Integrated Humanoid Hand and Finger SolutionIn fiscal Q3, Allegro will begin sampling what management described as the industry's first fully integrated magnetic sensor and motor-driver IC designed specifically for humanoid hands and fingers. The product combines TMR magnetic sensors and intelligent power drivers in a single compact chip, and management reported strong early customer interest.
- Energy Infrastructure Design-Win ValidationAllegro's silicon-carbide high-voltage gate driver secured its first major design win with a leading solar provider for next-generation inverters. Management also reported an accelerating pipeline across high-voltage gate drivers for energy infrastructure, EV traction inverters, data centers, and power infrastructure.
- Broad Product and Geographic GrowthMagnetic sensor sales increased 5% sequentially to $158 million and 21% year-over-year. Power-product sales increased 9% sequentially to $119 million and 42% year-over-year. Sales grew sequentially and year-over-year in all reported geographies. The sales mix was 33% rest of Asia, 25% China, 16% Japan, 14% the Americas, and 12% Europe.
- Gross Margin and Operating Margin ImprovementNon-GAAP gross margin was 51.5%, up 40 basis points sequentially from 51.1% and 190 basis points year-over-year, driven largely by operating leverage. Operating margin was 20.6%, up from 19.4% in Q1 and 13.9% in the prior-year quarter, an improvement of 670 basis points year-over-year. Adjusted EBITDA margin was 25%.
- Progress Toward Greater Than 55% Gross MarginManagement expects continued progress toward a gross-margin target of greater than 55%, supported by operating leverage, factory efficiencies, bill-of-material transitions such as gold-to-copper wire conversion, strategic price increases, and a richer technology mix. Copper-product shipments begin in fiscal Q3.
- Positive Cash Flow and Debt ReductionAllegro ended Q2 with $201 million of cash, generated $37 million of operating cash flow and $31 million of free cash flow on $6 million of capital expenditures. Term-loan debt was $285 million and net debt was $84 million. The company also made another voluntary $25 million debt payment on September 30.
- Working-Capital ImprovementInventory days declined to 117 from 128 days in fiscal Q1, while DSO was 36 days versus 35 days in Q1. Global distribution inventory remained in the middle of the company's 10-to-12-week target range, although some pockets were leaner than desired.
- Above-Seasonal Fiscal Q3 OutlookFiscal Q3 sales are expected to be $278 million-$288 million, with the midpoint representing a 23% year-over-year increase and approximately 2% sequential growth. This is above the historical December-quarter seasonal pattern of a 5% decline. Non-GAAP EPS is expected to be $0.25-$0.29, with the midpoint implying an 80% year-over-year increase.
- Expected Fiscal Q3 Margin and Cost ProfileFiscal Q3 non-GAAP gross margin is expected to be 51.5%-52.5%, operating expenses are expected to be $87 million ±$1 million, interest expense is projected at $4 million, the tax rate is expected to be 10%, and weighted-average diluted shares are estimated at 188 million.
- Strong Near-Term Order VisibilityManagement said orders on the books extend for a couple of quarters, with some orders beginning to reach fiscal 2028. The company said it feels good about the next couple of quarters based on current bookings.
- Capacity Expansion to Support GrowthThe company is adding back-end capacity in fiscal Q3 and Q4, particularly in test, to stay ahead of growth. Allegro has ample space in its Philippines facility, began shipping from a Chinese back-end OSAT for probe assembly and test, and has OSAT capacity available for assembly.
- Long-Term Growth ConfidenceManagement said the leading indicators provide high confidence in exceeding its target model of mid-teens annual sales growth. The company cited strong automotive and industrial momentum, robust backlog, record design wins, and expanding content in targeted secular-growth markets.
MX:ALGM Earnings History
| Report Date | Fiscal Quarter | Forecast / EPS | Last Year's EPS | EPS YoY Change | Press Release |
|---|---|---|---|---|---|
| Feb 02, 2027 | 2027 (Q3) | 5.11- | 2.82 | ― | ― |
| Oct 29, 2026 | 2027 (Q2) | 4.584.88 | 2.44 | 100.00% (+2.44) | |
| Jul 30, 2026 | 2027 (Q1) | 3.954.32 | 1.69 | 155.56% (+2.63) | |
| May 07, 2026 | 2026 (Q4) | 3.063.19 | 1.13 | 183.33% (+2.07) | |
| Jan 29, 2026 | 2026 (Q3) | 2.692.82 | 1.32 | 114.29% (+1.50) | |
| Oct 30, 2025 | 2026 (Q2) | 2.332.44 | 1.5 | 62.50% (+0.94) | |
| Jul 31, 2025 | 2026 (Q1) | 1.561.69 | 0.56 | 200.00% (+1.13) | |
| May 08, 2025 | 2025 (Q4) | 0.921.13 | 4.7 | -76.00% (-3.57) | |
| Jan 30, 2025 | 2025 (Q3) | 1.201.32 | 6.01 | -78.13% (-4.70) | |
| Oct 31, 2024 | 2025 (Q2) | 1.201.50 | 7.51 | -80.00% (-6.01) |
The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.
Beat Missed