Ambrella (AMBA) Numbers Cut at Needham & Company as Weak Wearable Sports Cameras Weigh
Needham & Company Hold Ambarella (NASDAQ: AMBA) following the company's 3Q earnings report. AMBA delivered much stronger than expected F3Q16 results, led by strength in IP security, automotive and flying cameras. Ambarella reported F3Q16 revenue of $93.2MM, up 41.9% Y/Y and slightly above the high-end of guidance of $90MM-$93MM. However, softer than expected sell-through and high inventory levels at lead sports camera customer GoPro has resulted in an inventory overhang that should serve as a near-term headwind over the next two quarters.
Analyst Quinn Bolton commented, "AMBA reported stronger than expected F3Q16 results led by strength in IP security, automotive and flying cameras. However, softer than expected sell-through and high inventory levels at lead sports camera customer GoPro has resulted in an inventory overhang that should serve as a near-term headwind over the next two quarters. Reflecting this headwind, F4Q16 revenue guidance fell below our Street-low estimates that already reflected our assumption for an inventory correction. As we believe sales of wearable sports cameras may remain soft through the holiday selling season, we remain on the sidelines as we monitor sell-through data for wearable sports cameras. Outside of wearable cameras, we are encouraged by AMBA's traction."
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Shares of Ambarella closed at $57.88 yesterday.