Needham & Company downgraded Sigma Designs (NASDAQ: SIGM) from Buy to Hold, citing intensifying competition in TV segment.

Analyst N. Quinn Bolton commented, "SIGM reported better than expected NG EPS and GM in F3Q17 but provided a disappointing F4Q17 outlook. Intensifying competition in the TV segment has forced the company to prioritize GM over revenue growth in this segment. With growth stalling in the TV business, we are forced to dramatically reduce our forward estimates. We now believe SIGM will show no revenue growth and operate at best at breakeven profitability in FY18. With no clear path that we can see to sustainable and profitable growth, we downgrade SIGM to Hold. We expect the investment outlook for SIGM to remain challenged until one of three catalysts occurs: 1) significant OPEX cuts that don't threaten current revenue streams, 2) divestiture of the unprofitable TV business, or 3) a faster than expected ramp in the IoT business."

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Shares of Sigma Designs closed at $7.75 yesterday.