Group 1: Hong Kong Stocks Performance - BYD Electronics (00285) rose over 7%, reporting a nearly 14% year-on-year increase in net profit for the first half of 2025, with positive progress in AI data center business [1] - Beihai Kangcheng-B (01228) surged over 11%, achieving profitability in the first half of the year and recently forming a strategic partnership with Baiyang Pharmaceutical [1] - MicroPort Medical (00853) increased over 11%, with a reported loss of $46.602 million for the first half of 2025, a 51.9% reduction in loss year-on-year [1] - Bank of China Hong Kong (02388) rose over 6%, reporting a net profit of HKD 22.12 billion for the first half of 2025, with an increase in net trading income year-on-year [1] - UBTECH (09880) increased over 4%, announcing a strategic partnership agreement worth $1 billion with international investment firm Infini Capital [1] - Gold stocks performed well, with China Silver Group (00815) up over 8%, Zhaojin Mining (01818) up over 7%, Shandong Gold (01787) up over 6%, Chifeng Jilong Gold (06693) up over 6%, and Zijin Mining (02899) up over 6%, driven by rising gold prices due to increased interest rate cut expectations [1] Group 2: Chinese Companies' Financial Results - China Communications Construction (01800) fell over 5%, reporting a 16.9% year-on-year decrease in net profit for the first half of 2025 and not declaring an interim dividend [2] - Evergrande Property (06666) declined over 3%, with a 5.6% year-on-year drop in net profit for the first half of the year, with management expressing pessimism about economic benefits from Evergrande Group [2] - Zoomlion Heavy Industry (01157) rose over 2%, reporting a more than 20% year-on-year increase in net profit for the first half of 2025, with institutions optimistic about export growth in the second half [2] - Midea Group (00300) increased over 2%, reporting a 25.04% year-on-year increase in net profit for the first half of 2025 and proposing an interim dividend of HKD 5 per 10 shares [2] Group 3: US Stocks Performance - Autodesk (ADSK.US) rose 9.09%, reporting a 17% year-on-year revenue increase for the second fiscal quarter and raising its full-year revenue and adjusted EPS guidance [3] - Gap (GAP.US) increased 1.52%, with revenue slightly below market expectations for the second fiscal quarter, and management indicated that tariffs may pressure annual gross margins [3] - Marvell Technology (MRVL.US) fell 18.60%, reporting record revenue of $2.01 billion for the second quarter, a 58% year-on-year increase, but provided a Q3 revenue guidance slightly below expectations [3] - Alibaba (BABA.US) surged 12.90%, with a market value increase of $36.7 billion overnight, reporting an 18% year-on-year decline in Non-GAAP net profit, but strong resilience in core business [3] - Ambarella (AMBA.US) rose 16.78%, providing strong guidance for Q3 revenue, expected to be between $100 million and $108 million, reflecting continued growth in edge AI demand [3] - IREN Ltd (IREN.US) increased 14.93%, exceeding expectations in its fourth-quarter earnings report and announcing a priority partnership with NVIDIA [3] Group 4: Other Notable Stocks - Dell Technologies (DELL.US) fell 8.88%, reporting that its infrastructure division's operating profit margin was below expectations [4] - Affirm Holdings (AFRM.US) rose 10.59%, reporting better-than-expected revenue and profit for the fourth fiscal quarter [4] - TryHard Holdings (THH.US) declined 9.80%, issuing 1.5 million shares at $4 each, at the lower end of the pricing range [5] - GrowHub (TGHL.US) increased 1.48%, issuing 3.8 million shares at $4 each, also at the lower end of the pre-set pricing range [5]

Core Insights - Ambarella reported strong quarterly results, with a stock price increase of approximately 17% following the announcement [1] Financial Performance - For Q2 of fiscal 2026, Ambarella generated $95.5 million in revenue, marking a nearly 50% year-over-year increase [2] - The company's non-GAAP net income rose by 16% to $6.4 million, equating to $0.15 per share [2] - Analysts had underestimated the company's growth potential, with average revenue forecasts at $90 million and adjusted profit expectations at $0.05 per share [3] Market Position and Strategy - Ambarella specializes in the edge segment of the semiconductor market, focusing on AI solutions for edge computing, which is currently in high demand [4] - The company has shipped over 36 million edge AI processors to date, highlighting its significant market presence [4] Future Outlook - Ambarella raised its full-year revenue guidance, now expecting a 31% to 35% increase for fiscal 2026 compared to 2025, with a midpoint revenue estimate of around $379 million [5]

Core Viewpoint - Ambarella (AMBA.US) experienced a significant stock increase of over 20%, reaching a new high for the year at $84.93, following the release of its Q2 2026 financial results that exceeded market expectations [1] Financial Performance - The company reported Q2 2026 revenue of $95.5 million, representing a year-over-year growth of 49.9%, surpassing the FactSet estimate of $90 million [1] - Non-GAAP earnings per share were $0.15, exceeding the IBES forecast range of $0.05 to $0.10 [1] Future Guidance - Ambarella raised its revenue growth target for the fiscal year 2026 to a range of 31% to 35% [1] - The company provided strong guidance for Q3 revenue, projecting a range of $100 million to $108 million, reflecting ongoing growth in edge AI demand [1]

Core Viewpoint - Ambarella (AMBA.US) experienced a significant stock increase of over 20%, reaching a new high for the year at $84.93, following the release of its Q2 FY2026 earnings which exceeded market expectations [1] Financial Performance - The company's revenue for Q2 FY2026 was reported at $95.5 million, representing a year-over-year growth of 49.9%, surpassing the FactSet estimate of $90 million [1] - Non-GAAP earnings per share were $0.15, exceeding the IBES forecast range of $0.05 to $0.10 [1] Future Guidance - Ambarella raised its revenue growth target for FY2026 to a range of 31% to 35% [1] - The company provided a strong revenue guidance for Q3, expecting between $100 million and $108 million, driven by the continued growth in edge AI demand [1]

Group 1 - Ambarella's stock increased by 20% following better-than-expected second-quarter results and strong guidance for the third quarter [1] - The company expects third-quarter revenue to be between $100 million and $108 million, surpassing LSEG's estimate of $91 million [1] - Ambarella raised its fiscal year revenue growth outlook to a range of 31-35%, with a midpoint of $379 million, exceeding LSEG's expectation of $350 million [2] Group 2 - The company reported adjusted earnings of 15 cents per share, compared to the expected 5 cents per share [3] - Revenue for the quarter was $96 million, exceeding the expected $90 million [3] - CEO Fermi Wang highlighted the company's extensive product portfolio and investments in edge AI R&D, enabling it to address a wider range of applications [2]

Financial Data and Key Metrics Changes - Revenue for Q2 fiscal year 2026 was $95.5 million, an increase of 11.2% sequentially and 49.9% year-over-year, exceeding prior guidance [23][7] - Non-GAAP gross margin for Q2 was 60.5%, at the low end of the prior guidance range [23] - Non-GAAP net profit for Q2 was $6.4 million, or $0.15 per diluted share [24] Business Line Data and Key Metrics Changes - Automotive revenue increased in the mid-single digits, while IoT revenue grew in the low teens, with IoT representing slightly more than 75% of total revenue [23] - The company reported strong demand for new five-nanometer AI SoCs across various applications, particularly in portable video and robotics [9][10] Market Data and Key Metrics Changes - The company anticipates revenue growth for fiscal year 2026 in the range of 31% to 35%, with a midpoint of approximately $379 million [9] - The edge AI business is expanding, with expectations for unit and average selling price growth [27] Company Strategy and Development Direction - The company is focusing on both autonomous driving and IoT markets, leveraging shared hardware architecture to optimize operational expenses [31] - The company is actively pursuing design wins in the automotive sector while also expanding its presence in the IoT market, particularly in portable video and robotics [12][19] Management's Comments on Operating Environment and Future Outlook - Management noted that while automotive growth is expected to eventually outperform IoT, the current strong performance in IoT is driven by shorter design cycles and more available opportunities [31][36] - The company remains optimistic about the edge AI market, with significant lifetime revenue opportunities in automotive autonomy [80] Other Important Information - The company has shipped over 36 million AI processors, establishing itself as a leader in the edge AI market [19] - The company is preparing for upcoming investor events, including participation in various conferences [5] Q&A Session Summary Question: Thoughts on IoT versus automotive focus - Management acknowledged the strong performance of IoT and indicated a balanced focus on both IoT and automotive markets, with plans to allocate more resources to IoT [31][32] Question: Expectations for automotive growth - Management expects automotive growth to eventually outperform IoT, particularly around 2027-2028, but noted that IoT will continue to contribute significantly in the near term [35][36] Question: Trends in robotic aerial drones - Management confirmed a growing trend in the drone market, with multiple companies focusing on autonomous drone applications [39] Question: Guidance for Q4 - Management indicated that seasonality is expected in Q4, driven by consumer cycles, but noted that growth rates are improving compared to previous years [48] Question: Non-security IoT growth - Management sees significant growth potential in non-security IoT applications, with expectations that this segment will outpace traditional security camera business [50][51] Question: Industry consolidation and strategy - Management refrained from commenting on industry rumors but emphasized the company's leadership in the edge AI market [57] Question: Demand pull-ins related to tariffs - Management stated that they have not observed any significant inventory buildup among customers, indicating confidence in demand stability [70] Question: Customer response to the Cooper development platform - Management reported positive feedback on the Cooper platform, which facilitates easier transitions between different chips for customers [72] Question: Growth drivers in IoT and automotive - Management indicated that growth is roughly split 50/50 between average selling price and unit growth [84] Question: IoT market split between security and non-security applications - Management noted that portable video applications are growing rapidly, with Insta360 being a significant customer [88]

Financial Data and Key Metrics Changes - Revenue for Q2 fiscal year 2026 was $95.5 million, an increase of 11.2% sequentially and 49.9% year-over-year, exceeding prior guidance [22][6][19] - Non-GAAP gross margin for Q2 was 60.5%, at the low end of the prior guidance range [22] - Non-GAAP net profit for Q2 was $6.4 million, or $0.15 per diluted share [23] Business Line Data and Key Metrics Changes - Automotive revenue increased in the mid-single digits, while IoT revenue grew in the low teens, with IoT representing slightly more than 75% of total revenue [22] - The company is seeing strong demand for new five-nanometer AI SoCs across various applications, particularly in portable video and robotics [7][9] Market Data and Key Metrics Changes - The company anticipates a revenue growth range of 31% to 35% for fiscal year 2026, with a midpoint of approximately $379 million [7][25] - The edge AI business is expanding, with significant growth expected in portable video applications and robotics [19][18] Company Strategy and Development Direction - The company is focusing on expanding its edge AI applications, including portable video, robotic aerial drones, and edge infrastructure [7][19] - Management emphasizes the importance of both automotive and IoT markets, with plans to allocate more resources to IoT due to its rapid growth [30][29] Management's Comments on Operating Environment and Future Outlook - Management remains optimistic about the growth trajectory of both automotive and IoT markets, with expectations for automotive to eventually outperform IoT by 2027-2028 [32][31] - The company is actively working on design wins in the automotive sector while also capitalizing on the rapid growth in IoT applications [76][75] Other Important Information - The company has shipped over 36 million AI processors, establishing itself as a leader in the edge AI market [18][55] - The company is targeting a significant increase in average selling prices due to the demand for higher-end AI SoCs [19][100] Q&A Session Summary Question: Is the company considering a pivot towards IoT given its strong performance? - Management acknowledges the strong performance of IoT and plans to allocate more resources to this area while continuing to focus on automotive [30][29] Question: Will automotive outgrow IoT next year? - Management believes automotive will eventually outperform IoT but expects IoT to continue contributing significantly in the near term [32][31] Question: What is the outlook for the robotic aerial drones market? - Management sees a growing trend in autonomous drones and expects multiple companies to enter this space, indicating a significant market opportunity [36][35] Question: How does the company view the growth of non-security applications in IoT? - Management anticipates that non-security applications, particularly portable video, will continue to grow rapidly and may eventually surpass security applications [46][48] Question: What is the company's strategy regarding industry consolidation? - Management refrains from commenting on rumors but emphasizes the strength and focus on edge AI as a key differentiator in the market [54][55] Question: How does the company monitor potential demand pull-ins related to tariffs? - Management maintains regular communication with customers and distributors to monitor inventory levels and demand trends [66][65] Question: What feedback has the company received on the Cooper development platform? - Management reports positive feedback on the Cooper platform, which facilitates easier transitions between different chips for customers [68][67] Question: What is the split between security and non-security applications in IoT? - Management indicates that portable video is the fastest-growing non-security application, with a significant contribution from various product lines [82][81]

Q2 FY2026 Financial Results Announcement [Q2 FY2026 Performance Highlights & Q3 FY2026 Outlook](index=1&type=section&id=Q2%20FY2026%20Performance%20Highlights%20%26%20Q3%20FY2026%20Outlook) Ambarella reported strong revenue growth and a non-GAAP net profit turnaround for Q2 FY2026, providing Q3 FY2026 guidance for continued revenue growth Q2 FY2026 and H1 FY2026 Key Financial Data | Metric | Q2 FY2026 | Q2 FY2025 | Change (YoY) | H1 FY2026 | H1 FY2025 | Change (YoY) | | :-------------------------------- | :---------- | :---------- | :--------- | :---------- | :---------- | :--------- | | **Revenue (Million USD)** | 95.5 | 63.7 | +49.9% | 181.4 | 118.2 | +53.5% | | **GAAP Gross Margin** | 58.9% | 60.8% | -1.9 pp | 59.4% | 60.8% | -1.4 pp | | **GAAP Net Loss (Million USD)** | (20.0) | (34.9) | Improved 42.7% | (44.3) | (72.8) | Improved 39.1% | | **GAAP Diluted Loss Per Share** | (0.47) | (0.85) | Improved 44.7% | (1.05) | (1.78) | Improved 41.0% | | **Non-GAAP Gross Margin** | 60.5% | 63.3% | -2.8 pp | 61.2% | 63.3% | -2.1 pp | | **Non-GAAP Net Income (Loss) (Million USD)** | 6.4 (Income) | (5.5) (Loss) | Turnaround to profit | 9.5 (Income) | (16.0) (Loss) | Turnaround to profit | | **Non-GAAP Diluted Earnings (Loss) Per Share** | 0.15 (Earnings) | (0.13) (Loss) | Turnaround to profit | 0.22 (Earnings) | (0.39) (Loss) | Turnaround to profit | Q3 FY2026 Financial Guidance | Metric | Range (Million USD/Percentage) | | :----------------------- | :--------------------- | | **Revenue** | $100.0 - $108.0 | | **Non-GAAP Gross Margin** | 60.0% - 61.5% | | **Non-GAAP Operating Expenses** | $54.0 - $57.0 | [CEO's Strategic Commentary](index=2&type=section&id=CEO%27s%20Strategic%20Commentary) CEO Fermi Wang highlighted strong cyclical growth in the edge AI market, projecting record revenue growth for FY2026, alongside product development and production advancements - The company is experiencing strong cyclical growth in the edge AI market, with expanding applications driving demand for higher-priced 5nm AI SoCs[6](index=6&type=chunk) - Multiple portable AI video applications have entered production, with the first robotic drone project expected to ship in volume by the end of FY2026, and the first edge infrastructure project projected for production in FY2027[6](index=6&type=chunk) - FY2026 revenue growth forecast is raised to **31% to 35%** (midpoint approximately **$379 million**), with new Q3 and full-year revenue guidance midpoints setting new quarterly and annual total revenue records for Ambarella[6](index=6&type=chunk) - Over **36 million** edge AI processors have been shipped to date, establishing market leadership and focusing on customer needs in the edge AI market, including automotive[6](index=6&type=chunk) [Cash and Marketable Securities Position](index=2&type=section&id=Cash%20and%20Marketable%20Securities%20Position) Ambarella's cash, cash equivalents, and marketable debt securities increased at the end of Q2 FY2026 compared to the prior quarter and year-ago period, indicating robust liquidity Cash, Cash Equivalents, and Marketable Debt Securities (Million USD) | Time Point | Amount (Million USD) | | :------------------- | :-------------- | | End of Q2 FY2026 | 261.2 | | End of Prior Quarter | 259.4 | | End of Prior Year Period | 219.8 | Detailed Financial Statements [CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (GAAP)](index=4&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) This section presents Ambarella's condensed consolidated statements of operations under GAAP, detailing revenue, costs, expenses, and net loss for the three and six months ended July 31, 2025 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (GAAP) (Thousand USD) | Metric | Three Months Ended July 31, 2025 | Three Months Ended July 31, 2024 | Six Months Ended July 31, 2025 | Six Months Ended July 31, 2024 | | :----------------------------------- | :-------------------------------- | :-------------------------------- | :-------------------------------- | :-------------------------------- | | Revenue | $95,511 | $63,724 | $181,383 | $118,197 | | Cost of revenue | 39,280 | 24,983 | 73,616 | 46,296 | | Gross profit | 56,231 | 38,741 | 107,767 | 71,901 | | Operating expenses: | | | | | | Research and development | 59,734 | 56,760 | 118,553 | 110,897 | | Sales, general and administrative | 18,486 | 18,268 | 37,061 | 36,736 | | Total operating expenses | 78,220 | 75,028 | 155,614 | 147,633 | | Operating loss | (21,989) | (36,287) | (47,847) | (75,732) | | Other income, net | 2,247 | 2,145 | 4,422 | 4,416 | | Loss before income taxes | (19,742) | (34,142) | (43,425) | (71,316) | | Provision for income taxes | 253 | 747 | 898 | 1,505 | | Net loss | $(19,995) | $(34,889) | $(44,323) | $(72,821) | | Diluted loss per share | $(0.47) | $(0.85) | $(1.05) | $(1.78) | | Diluted weighted-average shares outstanding | 42,546,979 | 41,129,754 | 42,383,475 | 40,952,373 | [Non-GAAP Financial Measures and Reconciliation](index=3&type=section&id=Non-GAAP%20Financial%20Measures) This section explains Ambarella's use of non-GAAP financial measures, their differences from GAAP, and provides detailed tables reconciling GAAP net loss to non-GAAP net income (loss) [Non-GAAP Methodology and Exclusions](index=4&type=section&id=Non-GAAP%20Methodology%20and%20Exclusions) The company provides non-GAAP financial information as a supplement to GAAP statements, benefiting management and investors in assessing operational performance and liquidity, primarily excluding stock-based compensation and acquisition-related costs and their tax impacts - Non-GAAP financial information supplements GAAP statements, used to assess operational performance and liquidity, and provides greater transparency for investors[14](index=14&type=chunk)[15](index=15&type=chunk) - Non-GAAP financial measures exclude stock-based compensation and acquisition-related costs and their related tax impacts[4](index=4&type=chunk)[14](index=14&type=chunk) - GAAP reconciliation for non-GAAP gross margin and operating expense guidance for Q3 FY2026 is not feasible on a forward-looking basis due to the high variability and low visibility of relevant exclusion items[16](index=16&type=chunk) [Stock-based Compensation and Acquisition-Related Costs](index=5&type=section&id=Stock-based%20compensation%20and%20acquisition-related%20costs) This section details stock-based compensation expenses and acquisition-related costs included in various functional line items, explaining their impact on the difference between GAAP and non-GAAP gross margins Stock-based Compensation Expense (Thousand USD) | Item | Three Months Ended July 31, 2025 | Three Months Ended July 31, 2024 | Six Months Ended July 31, 2025 | Six Months Ended July 31, 2024 | | :---------------------- | :-------------------------------- | :-------------------------------- | :-------------------------------- | :-------------------------------- | | Cost of revenue | $780 | $833 | $1,731 | $1,440 | | Research and development | 16,972 | 18,395 | 34,557 | 36,016 | | Sales, general and administrative | 7,436 | 8,384 | 15,030 | 16,192 | | **Total Stock-based Compensation Expense** | **$25,188** | **$27,612** | **$51,318** | **$53,648** | Acquisition-Related Costs (Thousand USD) | Item | Three Months Ended July 31, 2025 | Three Months Ended July 31, 2024 | Six Months Ended July 31, 2025 | Six Months Ended July 31, 2024 | | :---------------------- | :-------------------------------- | :-------------------------------- | :-------------------------------- | :-------------------------------- | | Cost of revenue | $757 | $757 | $1,514 | $1,514 | | Research and development | — | — | — | — | | Sales, general and administrative | 456 | 530 | 912 | 1,050 | | **Total Acquisition-Related Costs** | **$1,213** | **$1,287** | **$2,426** | **$2,564** | - The difference between GAAP and non-GAAP gross margins primarily stems from the amortization of stock-based compensation and acquisition-related costs[19](index=19&type=chunk) [RECONCILIATION OF GAAP TO NON-GAAP DILUTED EARNINGS (LOSSES) PER SHARE](index=5&type=section&id=RECONCILIATION%20OF%20GAAP%20TO%20NON-GAAP%20DILUTED%20EARNINGS%20%28LOSSES%29%20PER%20SHARE) This section provides a detailed reconciliation table, showing the adjustments from GAAP net loss to non-GAAP net income (loss) and corresponding diluted earnings (losses) per share, primarily including stock-based compensation, acquisition-related costs, and income tax effects GAAP to Non-GAAP Diluted Earnings (Losses) Per Share Reconciliation (Thousand USD, except per share data) | Metric | Three Months Ended July 31, 2025 | Three Months Ended July 31, 2024 | Six Months Ended July 31, 2025 | Six Months Ended July 31, 2024 | | :----------------------------------- | :-------------------------------- | :-------------------------------- | :-------------------------------- | :-------------------------------- | | GAAP Net Loss | $(19,995) | $(34,889) | $(44,323) | $(72,821) | | Non-GAAP Adjustments: | | | | | | Stock-based compensation expense | 25,188 | 27,612 | 51,318 | 53,648 | | Acquisition-related costs | 1,213 | 1,287 | 2,426 | 2,564 | | Income tax impact | 22 | 448 | 36 | 600 | | **Non-GAAP Net Income (Loss)** | **$6,428** | **$(5,542)** | **$9,457** | **$(16,009)** | | GAAP Diluted Weighted-Average Shares Outstanding | 42,546,979 | 41,129,754 | 42,383,475 | 40,952,373 | | Non-GAAP Diluted Weighted-Average Shares Outstanding | 42,946,324 | 41,129,754 | 42,698,780 | 40,952,373 | | GAAP Diluted Loss Per Share | $(0.47) | $(0.85) | $(1.05) | $(1.78) | | Non-GAAP Adjustments: | | | | | | Stock-based compensation expense | 0.59 | 0.68 | 1.21 | 1.32 | | Acquisition-related costs | 0.03 | 0.03 | 0.06 | 0.06 | | Income tax impact | 0.00 | 0.01 | 0.00 | 0.01 | | Non-GAAP Diluted Weighted-Average Shares Outstanding Impact | — | — | — | — | | **Non-GAAP Diluted Earnings (Loss) Per Share** | **$0.15** | **$(0.13)** | **$0.22** | **$(0.39)** | [CONDENSED CONSOLIDATED BALANCE SHEETS](index=6&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) This section presents Ambarella's condensed consolidated balance sheets as of July 31, 2025, and January 31, 2025, detailing the composition of the company's assets, liabilities, and stockholders' equity CONDENSED CONSOLIDATED BALANCE SHEETS (Thousand USD) | Item | July 31, 2025 | January 31, 2025 | | :--------------------------------- | :------------------- | :------------------- | | **Assets** | | | | Current assets: | | | | Cash and cash equivalents | $142,739 | $144,622 | | Marketable debt securities | 118,444 | 105,643 | | Accounts receivable, net | 42,896 | 29,767 | | Inventories | 33,808 | 34,428 | | Restricted cash | 442 | 7 | | Prepaid expenses and other current assets | 5,543 | 6,084 | | **Total current assets** | **343,872** | **320,551** | | Property and equipment, net | 10,092 | 9,084 | | Intangible assets, net | 41,879 | 47,279 | | Operating lease right-of-use assets, net | 3,500 | 5,188 | | Goodwill | 303,625 | 303,625 | | Other non-current assets | 3,463 | 3,241 | | **Total assets** | **$706,431** | **$688,968** | | **Liabilities and Stockholders' Equity** | | | | Current liabilities: | | | | Accounts payable | 26,783 | 21,775 | | Accrued and other current liabilities | 76,190 | 80,781 | | Operating lease liabilities, current | 1,774 | 2,829 | | Income taxes payable | 1,713 | 1,383 | | Deferred revenue, current | 19,482 | 14,226 | | **Total current liabilities** | **125,942** | **120,994** | | Operating lease liabilities, non-current | 1,668 | 2,436 | | Other long-term liabilities | 2,301 | 4,126 | | **Total liabilities** | **129,911** | **127,556** | | Stockholders' equity: | | | | Preferred stock | — | — | | Common stock | 19 | 19 | | Additional paid-in capital | 872,822 | 813,683 | | Accumulated other comprehensive income (loss) | 59 | (233) | | Accumulated deficit | (296,380) | (252,057) | | **Total stockholders' equity** | **576,520** | **561,412** | | **Total liabilities and stockholders' equity** | **$706,431** | **$688,968** | Company Information and Disclosures [About Ambarella](index=2&type=section&id=About%20Ambarella) Ambarella specializes in edge AI semiconductors, with products widely used in edge AI and human vision, offering powerful deep neural network processing and high-resolution video compression technologies - Ambarella's products are widely used in edge AI and human vision applications, including video security, advanced driver assistance systems (ADAS), electronic mirrors, drive recorders, driver/cabin monitoring, autonomous driving, and robotics applications[8](index=8&type=chunk) - The company's low-power system-on-chips (SoCs) provide powerful deep neural network processing for intelligent perception, fusion, and planning, along with high-resolution video compression, advanced image, and radar processing[8](index=8&type=chunk) ["Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995](index=2&type=section&id=%22Safe%20harbor%22%20statement%20under%20the%20Private%20Securities%20Litigation%20Reform%20Act%20of%201995) This statement advises investors that the press release contains forward-looking statements, and actual results may differ materially due to various risks, uncertainties, and assumptions, thus cautioning against undue reliance on such information - The press release contains forward-looking statements identifiable by words such as "outlook," "project," "intend," "will," "estimate," "expect," "believe," "may," and "should"[9](index=9&type=chunk) - The achievement or success of forward-looking statements involves risks, uncertainties, and assumptions, and actual results may differ materially from those projected or implied[10](index=10&type=chunk) - Risks and uncertainties include global economic and political conditions, changes in government policies, revenue from new customers or design wins, commercial success of customer products, inventory management capabilities, growth strategies, ability to forecast market demand, introduction of new solutions and technologies, customer relationships, market expansion, global health conditions, growth management, retention of key employees, and intellectual property disputes[11](index=11&type=chunk) [Quarterly Conference Call Details](index=2&type=section&id=Quarterly%20Conference%20Call) Ambarella plans to host a conference call to discuss Q2 FY2026 results, with a webcast and archived information available - Ambarella plans to host a conference call at **4:30 p.m. ET / 1:30 p.m. PT** to discuss Q2 FY2026 results[7](index=7&type=chunk) - A live and archived webcast of the conference call will be available on Ambarella's website for up to **30 days**[7](index=7&type=chunk)

Core Viewpoint - Ambarella, Inc. reported strong financial results for the second quarter of fiscal year 2026, with significant revenue growth driven by the edge AI market and an optimistic outlook for future performance [1][4]. Financial Performance - Revenue for the second quarter of fiscal 2026 was $95.5 million, representing a 49.9% increase from $63.7 million in the same period of fiscal 2025 [5]. - For the six months ended July 31, 2025, revenue totaled $181.4 million, up 53.5% from $118.2 million for the same period in fiscal 2024 [5]. - GAAP net loss for the second quarter was $20.0 million, or loss per diluted share of $0.47, compared to a net loss of $34.9 million, or loss per diluted share of $0.85, in the same period of fiscal 2025 [5]. - Non-GAAP net profit for the second quarter was $6.4 million, or earnings per diluted share of $0.15, compared to a non-GAAP net loss of $5.5 million, or loss per diluted share of $0.13, in the same period of fiscal 2025 [5]. Guidance and Outlook - The company increased its revenue growth estimate for fiscal 2026 to a range of 31% to 35%, approximately $379 million at the midpoint [4]. - Revenue guidance for the third quarter of fiscal 2026 is expected to be between $100.0 million and $108.0 million, with a non-GAAP gross margin expected to be between 60.0% and 61.5% [5]. Market Position and Strategy - Ambarella has shipped over 36 million edge AI processors to date, establishing itself as a market leader in the edge AI sector [6]. - The company is focused on expanding its applications in the edge AI market, including automotive and robotics, with expectations for production shipments from new product wins [4][7]. Cash Position - Total cash, cash equivalents, and marketable debt securities at the end of the second quarter of fiscal 2026 was $261.2 million, compared to $259.4 million at the end of the prior quarter and $219.8 million a year ago [3].

Summary of Key Points from the Conference Call Industry Overview - **Industry**: Semiconductors, specifically focusing on North America - **Key Companies Discussed**: Intel (INTC), NVIDIA (NVDA), Marvell Technology Group Ltd (MRVL), Ambarella Inc (AMBA) Intel (INTC) - **Government Investment**: Intel has entered an agreement with the US government for an equity stake involving an $8.9 billion investment, funded by CHIPS Act grants and the "secure enclave" program [2][2] - **Equity Details**: The investment is priced at $20.47 per share, with a warrant for an additional 5% of shares at $20 if Intel's foundry ownership falls below 51% [2][4] - **Business Flexibility**: The deal allows Intel to optimize its business model without public service commitments, indicating a potential shift away from foundry services [3][3] - **Foundry Strategy**: There is skepticism about the viability of Intel's foundry strategy, with a suggestion that optimism around CHIPS funds may have been misplaced [3][5] NVIDIA (NVDA) - **Earnings Outlook**: Anticipated revenues for October are projected at $52.5 billion, with some analysts suggesting potential upside to $55 billion [10][10] - **China Market Concerns**: Uncertainties regarding China could clarify expectations, with management expected to guide conservatively due to licensing issues and potential restrictions on American chip sales to China [11][12] - **Investor Sentiment**: There has been a shift from pessimism to optimism regarding NVIDIA's earnings, with strong anecdotal evidence supporting growth in the next 12 months [10][13] Marvell Technology Group Ltd (MRVL) - **Earnings Preview**: Expected upside from optical segments, with AI revenue projected to grow to $876 million (+6.6% q/q) in July and $955 million (+9.0% q/q) in October [18][29] - **Automotive Divestiture**: The recent divestiture of the automotive ethernet business for $2.5 billion is expected to enhance GAAP profitability in the October quarter [31][31] - **Market Position**: Despite some share loss to competitors, Marvell is expected to benefit from the 1.6T upgrade cycle and maintain a strong position in optical markets [18][29] Ambarella Inc (AMBA) - **Growth Drivers**: Strong demand in IoT is expected to offset pressures in the automotive sector, with revenue projected at $90 million (+41% y/y) for July and $92 million (+11.6% y/y) for October [23][54] - **Strategic Options**: There are reports of Ambarella exploring strategic options, including a potential sale, which could unlock value by pairing its technology with larger distribution networks [24][55] - **Technology Leadership**: Ambarella's edge AI technology is considered best-in-class, but commercialization in the automotive supply chain has faced challenges [24][55] Additional Insights - **Market Sentiment**: Overall sentiment in the semiconductor sector appears to be cautiously optimistic, with potential for positive shifts in stock performance for companies like Marvell and Ambarella [22][32] - **Valuation Concerns**: Despite growth potential, valuation remains a concern for Marvell, leading to an equal-weight rating [37][42] - **Long-term Prospects**: Ambarella's long-term prospects are viewed positively, particularly in the context of computer vision applications, although current development in automotive autonomy is slow [59][64] This summary encapsulates the key points discussed in the conference call, highlighting the current state and outlook of the semiconductor industry and the companies involved.