Financial Data and Key Metrics Changes - The company reported record quarterly revenue of $108.5 million, exceeding the high end of guidance and representing a 31.2% year-over-year increase [8][20] - Non-GAAP gross margin for Fiscal Q3 was 60.9%, slightly above the prior guidance range of 60% to 61.5% [20] - Non-GAAP net profit was $11.9 million, or $0.27 per diluted share in Q3 [21] - Cash and marketable securities reached $295.3 million, increasing $34.1 million from the prior quarter [21] Business Line Data and Key Metrics Changes - Edge AI revenue constituted about 80% of total revenue, marking the sixth consecutive quarter of record edge AI revenue [8] - Automotive revenue increased in the low single digits, while IoT revenue grew in the mid-teens, driven by edge AI adoption in enterprise security and portable video applications [20] Market Data and Key Metrics Changes - The company forecasts a large Edge serviceable available market of $12.9 billion by Fiscal Year 2031, indicating significant growth potential in the Edge AI market [18] - The split between enterprise and consumer markets is roughly 50/50, with enterprise CapEx-driven markets and consumer markets both contributing to revenue [37] Company Strategy and Development Direction - The company is committed to expanding its Edge AI technology and product offerings, focusing on applications in enterprise security, automotive safety, smart home, and portable video markets [9][10] - The company plans to continue investing in R&D to maintain its leadership position in Edge AI technology [18] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth opportunities in Edge AI, citing increasing demand across various applications and rising AI performance requirements [9][10] - The company raised its Fiscal 2026 revenue growth guidance to a range of 36% to 38%, reflecting strong demand and pricing power [8] Other Important Information - Les Kohn, co-founder and CEO, will transition to chief technology advisor, continuing to oversee technology direction without management responsibilities [6] - The company will host several investor events in the upcoming months, including a technology and product briefing at CES [4] Q&A Session Summary Question: How much of the 36% to 38% growth is driven by unit versus ASP? - Management indicated that both unit growth and ASP growth contribute equally to the overall growth [28] Question: Can you provide more details on the portable video market? - Management noted that the portable video market includes various product lines, such as action cameras and drones, and is expected to continue growing [31] Question: What is the split between consumer and enterprise markets? - The split is roughly 50/50, with enterprise CapEx-driven markets and consumer markets both contributing significantly [37] Question: How do you view gross margin moving forward? - Management stated that gross margin will depend on the contribution from high-volume customers, with a long-term target of 59% to 62% [39] Question: What are the growth opportunities in the drone market? - Management highlighted the potential for autonomous drones and the company's strong video technology as key drivers for growth in this market [49] Question: Any updates on the home security market? - Management confirmed design wins in the home security market but noted that it is price-sensitive and developing slower than expected [58] Question: What is the outlook for the automotive market? - Management confirmed ongoing engagement with multiple OEMs for autonomous driving applications, indicating continued focus on this market [76]

Financial Data and Key Metrics Changes - The company reported record quarterly revenue of $108.5 million, exceeding the high end of the guidance range and representing a 31.2% year-over-year increase [6][16] - Non-GAAP gross margin for Q3 was 60.9%, slightly above the midpoint of the prior guidance range [16] - Non-GAAP net profit was $11.9 million, or $0.27 per diluted share [17] Business Line Data and Key Metrics Changes - Edge AI revenue constituted about 80% of total revenue, marking the sixth consecutive quarter of record edge AI revenue [6] - Automotive revenue increased in the low single digits, while IoT revenue grew in the mid-teens, driven by the adoption of edge AI in enterprise security and portable video applications [16] Market Data and Key Metrics Changes - The company anticipates a large edge serviceable available market of $12.9 billion by fiscal year 2031, indicating significant growth potential in the edge AI market [15] - The portable video market is experiencing a resurgence, contributing significantly to growth, with new product launches from customers like Insta360 [12][23] Company Strategy and Development Direction - The company is committed to expanding its edge AI technology and product offerings, focusing on applications in enterprise security, automotive safety, smart home, and portable video markets [7][8] - The strategy includes increasing average selling prices (ASP) through advanced technology and product differentiation, with a blended ASP increase of about 20% year-over-year [10] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the edge AI opportunity, citing increasing demand across various applications and a strong product roadmap [6][7] - The company is focused on maintaining R&D investments to solidify its leadership position in the edge AI market [15] Other Important Information - The company announced that co-founder and CEO Les Kohn will step down from the board to become chief technology advisor, continuing to oversee technology direction [5] - Cash and marketable securities reached $295.3 million, reflecting strong operating cash flow associated with increased revenue [17] Q&A Session Summary Question: What is the contribution of unit growth versus ASP in the projected 36-38% growth for fiscal 2026? - Management indicated that both unit growth and ASP growth contribute equally to the overall growth [21][22] Question: Can you provide more details on the portable video market? - The company highlighted various product lines within the portable video market, including action cameras and drones, indicating strong growth momentum [23] Question: How is the consumer versus enterprise split in the edge AI market? - The split is roughly 50/50 between enterprise CapEx-driven and consumer markets, with different types of consumer spending impacting volatility [25] Question: What are the expectations for gross margin in the upcoming quarters? - Management noted that gross margin will depend on the contribution from high-volume customers, with a long-term target of 59-62% [26][43] Question: What is the outlook for the automotive market? - The company remains committed to the automotive market, engaging with multiple OEMs for autonomous driving applications [41]

Revenue Performance - Revenue for Q3 FY 2026 was $108.5 million, up 31.2% from $82.7 million in Q3 FY 2025[3] - The company expects Q4 FY 2026 revenue to be between $97.0 million and $103.0 million[3] - The new revenue growth guidance for FY 2026 is projected to be between 36% and 38%, an increase from the previous estimate of 31% to 35%[6] - Ambarella's edge AI revenue has set its sixth consecutive revenue record, indicating strong demand for its products[6] Profitability Metrics - Non-GAAP net profit for Q3 FY 2026 was $11.9 million, or earnings per diluted share of $0.27, compared to $4.6 million, or $0.11 per diluted share in Q3 FY 2025[3] - GAAP net loss for Q3 FY 2026 was $15.1 million, or loss per diluted share of $0.35, an improvement from a loss of $24.1 million, or $0.58 per diluted share in Q3 FY 2025[3] - GAAP diluted net loss per share for Q3 2025 was $(0.35), an improvement from $(0.58) in Q3 2024[20] - Non-GAAP diluted net income per share for Q3 2025 was $0.27, compared to $0.11 in Q3 2024, reflecting a 145.5% increase[20] Cash and Assets - Total cash, cash equivalents, and marketable debt securities at the end of Q3 FY 2026 was $295.3 million, up from $261.2 million in the prior quarter[5] - Total current assets increased to $383,667,000 as of October 31, 2025, up from $320,551,000 at the end of January 2025, reflecting a 19.7% growth[21] - Cash and cash equivalents rose to $174,057,000, compared to $144,622,000 in January 2025, indicating a 20.3% increase[21] - Accounts receivable increased to $42,227,000 from $29,767,000, a growth of 42%[21] - Inventories rose to $39,159,000, up from $34,428,000, indicating a 13.3% increase[21] Liabilities and Equity - Total liabilities increased to $161,777,000 from $127,556,000, representing a 26.8% rise[21] - Shareholders' equity improved to $590,113,000 as of October 31, 2025, up from $561,412,000, showing a 5.1% increase[21] Operating Expenses - Operating expenses on a non-GAAP basis for Q4 FY 2026 are expected to be between $55.0 million and $58.0 million[3] - Year-to-date free cash flow is 14.8% of revenue, reflecting strong growth and operating efficiency[6] Historical Comparison - GAAP net loss for Q3 2025 was $15,107,000, compared to a loss of $24,071,000 in Q3 2024, representing a 37.5% improvement year-over-year[20] - Non-GAAP net income for Q3 2025 was $11,864,000, significantly higher than $4,459,000 in Q3 2024, marking a 166.5% increase[20]

Core Insights - Ambarella, Inc. reported record quarterly revenue of $108.5 million for Q3 FY2026, representing a 31.2% increase from $82.7 million in the same period of FY2025 [4][6] - The company anticipates revenue growth guidance for FY2026 to be between 36% and 38%, up from the previous estimate of 31% to 35% [4] - Non-GAAP net profit for Q3 FY2026 was $11.9 million, or $0.27 per diluted share, compared to a non-GAAP net profit of $4.6 million, or $0.11 per diluted share, in Q3 FY2025 [6][18] Financial Performance - Total cash, cash equivalents, and marketable debt securities at the end of Q3 FY2026 were $295.3 million, an increase from $261.2 million in the previous quarter and $226.5 million year-over-year [3] - GAAP net loss for Q3 FY2026 was $15.1 million, or a loss of $0.35 per diluted share, an improvement from a net loss of $24.1 million, or a loss of $0.58 per diluted share, in Q3 FY2025 [6][18] - Gross margin under GAAP for Q3 FY2026 was 59.6%, slightly down from 60.6% in Q3 FY2025 [6] Market Outlook - The company is optimistic about the rising demand for edge AI applications, which is expected to drive future revenue growth [4] - Ambarella's products are utilized in various edge AI applications, including video security, advanced driver assistance systems, and autonomous driving [8] - The company is focused on sustaining its edge AI R&D investment to capitalize on new product cycles and increasing average selling prices [4]

Core Points - The article emphasizes the importance of enabling Javascript and cookies in browsers to prevent access issues [1] - It highlights that users with ad-blockers may face restrictions when trying to access content [1] Summary by Categories Technical Requirements - Users are advised to enable Javascript and cookies in their browsers to ensure proper functionality [1] - The presence of ad-blockers can lead to blocked access, necessitating their temporary disablement [1]

Core Insights - Ambarella focuses on "edge AI" technology, designing system-on-a-chip (SoC) semiconductors for localized device performance, which has led to a recent surge in its stock price [1]. Company Performance - Ambarella has achieved a significant milestone by earning membership in the 95-plus composite rating club, indicating strong performance metrics [4]. - The company's stock has soared following a strong Q2 earnings report, driven by growth in the edge AI sector [4]. Market Context - The broader market has seen fluctuations, with notable sell-offs in major stocks like Nvidia, Robinhood, and Tesla, contributing to a nearly 400-point drop in the Dow Jones index [2].

Core Insights - Ambarella, Inc. has shifted its focus from solely automotive applications to include Internet of Things (IoT) solutions, resulting in significant revenue growth [1] Financial Performance - Revenue has increased nearly 50% year over year, with IoT now being the primary driver of this growth [1]

Core Insights - The article discusses the author's extensive experience in value investing and highlights the importance of analyzing listed companies in the ASEAN and US regions [1]. Group 1 - The author has two decades of investing experience and is a self-taught value investor [1]. - The blog focuses on value investing through case studies, providing insights into the valuation of companies [1]. - The author has served as a Board member of a Malaysia listed company for several decades, offering a unique perspective on the market [1]. Group 2 - The author has published a value investing book titled "Do you really want to master value investing?" available on Amazon [1].

Industry Overview - The transportation and automotive industry is expected to undergo significant changes driven by advancements in Artificial Intelligence (AI), sensor technology, and electric vehicles, particularly in the driverless vehicle market, which is projected to exceed $13 trillion by 2030 [1] Company Insights Ambarella - Ambarella's systems-on-chip (SoC) provide high processing power for extracting data from video and radar streams, applicable in advanced driver assistance systems (ADAS), autonomous driving, and robotics [2] - The company's focus on edge AI, which pertains to on-device AI applications, is expected to see its Serviceable Addressable Market (SAM) grow from $5.5 billion in fiscal 2026 to $12.9 billion in fiscal 2031 [3] - AI inferencing technology is enhancing automotive safety and telematics applications, positioning Ambarella for growth as the driverless vehicle market expands [4] Nvidia - Nvidia is a leader in GPU-accelerated computing, with its products serving as the core for computers, robots, and driverless vehicles [5] - The partnership with Uber aims to scale its autonomous fleet to 100,000 vehicles by 2027, indicating Nvidia's commitment to the driverless vehicle sector [6] - Nvidia is developing software stacks on its DRIVE level 4 platform, enhancing its competitive advantage as vehicles become more electrified and complex [7] QuantumScape - QuantumScape is focused on developing next-generation solid-state lithium-metal batteries, which are crucial for electric driverless vehicles, enhancing range, reducing costs, and improving safety [10] - The company has begun deliveries of QSE-5 samples, marking progress toward commercialization, and has shifted to a capital-light licensing model to extend its cash runway until 2030 [11] - Despite being a high-risk and volatile stock, QuantumScape's potential for commercialization could yield significant long-term gains for investors [12]

Core Viewpoint - Ambarella, Inc. will hold its third quarter fiscal year 2026 earnings conference call on November 25, 2025, at 1:30 p.m. Pacific Time, with the earnings release issued after market close on the same day [1]. Company Overview - Ambarella is an edge AI semiconductor company that provides products for various applications, including video security, advanced driver assistance systems (ADAS), electronic mirrors, telematics, driver/cabin monitoring, autonomous driving, edge infrastructure, drones, and robotics [3]. - The company's low-power systems-on-chip (SoCs) are designed for high-resolution video compression, advanced image and radar processing, and deep neural network processing, enabling intelligent perception, sensor fusion, and planning [3]. Conference Call Registration - Interested participants must register online in advance to ask questions during the call, and a registration verification code will be emailed for completion of the registration process [2]. - After registration, dial-in numbers and a personal identification number (PIN) will be sent to the registered email, which is required to access the live call [2]. Webcast Information - A live webcast of the conference call and a replay will be available on Ambarella's investor relations website [3].