Allegro Micro tops Q1 estimates on data center growth

Overview

• US semiconductor maker's fiscal Q1 revenue rose 27% yr/yr, beating analyst expectations

• Adjusted EPS for fiscal Q1 beat analyst expectations

• Company cites record data center sales and strength in xEV and ADAS as growth drivers

Outlook

• Allegro expects Q2 net sales between $265 mln and $275 mln

• Company sees Q2 non-GAAP gross margin between 50.75% and 51.75%

• Allegro expects Q2 non-GAAP diluted EPS between $0.23 and $0.26

Result Drivers

• DATA CENTER GROWTH - Record data center sales reached 17% of total sales, driving overall revenue growth

• xEV AND ADAS STRENGTH - Continued strength in xEV and ADAS contributed to sales growth, according to CEO Mike Doogue

• AI, ELECTRIFICATION, AUTOMATION TRENDS - Company said its products are benefiting from megatrends in AI, electrification, and automation across Auto and Industrial markets

Company press release: ID:nGNX8SjqZT

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 10 "strong buy" or "buy", 1 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the semiconductors peer group is "buy"

• Wall Street's median 12-month price target for Allegro Microsystems Inc is $55.00, about 30.3% above its July 29 closing price of $42.21

• The stock recently traded at 37 times the next 12-month earnings vs. a P/E of 33 three months ago

Reuters Recommended Reads

• July 27 - Navitas Semiconductor Q2 revenue rises on AI infrastructure demand

• July 28 - NXP Semiconductors forecasts upbeat quarter as AI push pays off

• July 29 - Littelfuse Q2 revenue beats estimates on semiconductor demand; lifts dividend

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)