Core Insights - Mobileye Global Inc. (MBLY) reported second-quarter 2025 adjusted earnings per share of 13 cents, exceeding the Zacks Consensus Estimate of 11 cents, and up from 9 cents in the same quarter last year [1][9] - Total revenues reached $506 million, surpassing the Zacks Consensus Estimate of $485 million, and reflecting a year-over-year increase of 15.26%, driven by strong EyeQ volumes and demand for the SuperVision system [2][9] - The company's gross margin improved to 50%, a 2.2 percentage point increase from the prior year, attributed to higher revenue levels with consistent amortization of intangible assets [3] - Adjusted operating margin rose to 21%, compared to 18% in the same quarter of 2024, due to lower operating expenses as a percentage of revenues [3] Financial Position - As of June 28, 2025, MBLY had cash and cash equivalents of $1.71 billion, an increase from $1.43 billion as of December 28, 2024 [4] - Operating cash flow for the first half of 2025 was $322 million, with capital expenditures amounting to $28 million during the same period [4] 2025 Outlook - MBLY revised its 2025 revenue guidance to $1,765-$1,885 million, up from the previous estimate of $1,690-$1,810 million [5] - The company expects an operating loss of $436-$512 million, improved from the earlier estimate of $489-$574 million, while adjusted operating income is now estimated at $210-$286 million, up from $175-$260 million [5] Market Position - MBLY currently holds a Zacks Rank 3 (Hold) [6] - Competitors with better rankings include Ferrari N.V. (RACE) with a Zacks Rank 1 (Strong Buy), and Valmont Industries (VMI) and XPeng Inc. (XPEV), both with a Zacks Rank 2 (Buy) [6]

Investment Rating - The report maintains a "Buy" rating for Mobileye (MBLY.US) with a target price adjusted to $18.1, indicating a potential upside of 17% [1][3]. Core Insights - Mobileye's 2Q25 performance exceeded expectations, with revenue reaching $506 million, a 15% year-over-year increase. The company has raised its full-year revenue guidance to a range of $1.765 to $1.885 billion [9][12]. - The company is optimistic about its growth trajectory, expecting a revenue inflection point in 2027, driven by advancements in autonomous driving technology and partnerships with major players like Volkswagen, Lyft, and Uber [9][12]. Financial Forecasts - Revenue projections for Mobileye from 2023 to 2027 are as follows: - 2023: $2,079 million - 2024: $1,654 million - 2025E: $1,851 million - 2026E: $1,948 million - 2027E: $2,650 million - The adjusted net profit is forecasted to grow from $659 million in 2023 to $540 million in 2027, with a notable increase of 56% in 2027 [2][10]. Performance Metrics - In 2Q25, Mobileye's total shipment volume reached 9.7 million units, a 28% increase year-over-year, with EyeQ chip shipments close to 9.65 million units [12]. - The adjusted gross margin for 2025 is projected at 68.5%, with an adjusted net profit margin of 15.6% [13][15]. Valuation - The report employs a DCF valuation method, estimating a WACC of 12.3% and a perpetual growth rate of 3%, leading to a target price of $18.1 per share [9][14].

Core Insights - Mobileye Global reported a fiscal second-quarter 2025 revenue of $506 million, a 15% year-on-year increase, surpassing analyst expectations of $463.26 million, with adjusted EPS of 13 cents exceeding the consensus estimate of 9 cents [1][3] - The company raised its fiscal 2025 revenue outlook to a range of $1.765 billion to $1.885 billion, up from the previous range of $1.690 billion to $1.810 billion, aligning closely with the analyst consensus estimate of $1.770 billion [2] Financial Performance - Shipments of approximately 9.7 million EyeQ units exceeded the analyst's estimate of 9 million, driven by strong demand from OEMs, particularly in China [6] - Adjusted gross margin for the quarter was 68.6%, slightly above the analyst's estimate of 68.4% and close to the Street's expectation of 68.8% [6] - Operating expenses were lower than anticipated at $241 million, resulting in adjusted operating income of $106 million, surpassing both expectations and the preliminary guidance [6] Future Outlook - Management emphasized 2027 as a critical year for revenue acceleration, driven by the adoption of SuperVision and initial deployments of Connected and Autonomous Vehicles (CAVs) [7] - Full-scale Drive deployments are planned for late 2026 across multiple U.S. and European cities, with the CAV business expected to contribute $150 million in 2027 revenue [8] - The company anticipates ADAS revenue could reach around $2 billion in 2027, which is considered a conservative estimate [8] Market Position and Partnerships - Mobileye's partnerships with major companies such as Volkswagen, Uber, and Lyft are expected to enhance its market position in the autonomous driving sector [9] - The company is transitioning to full production hardware for the ID. Buzz robotaxi, with teleoperations expected to begin in 2025 and driverless service planned for 2026 [9] Analyst Commentary - Needham analyst Quinn Bolton reiterated a buy rating on Mobileye with a price target of $18, despite the stock's decline following the earnings report [3][11] - Bolton noted that while management's tone was cautious, there is potential upside in fourth-quarter revenue and improving margin visibility, supporting a strong long-term growth trajectory for Mobileye [11]

Core Viewpoint - Mobileye Global (MBLY) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive outlook on its earnings estimates, which significantly influence stock prices [1][3]. Earnings Estimates and Stock Price Impact - The Zacks rating system is based on changes in earnings estimates, which are strongly correlated with near-term stock price movements [4][6]. - Institutional investors often adjust their valuations based on earnings estimates, leading to significant stock price movements when they buy or sell large amounts of shares [4]. Mobileye's Earnings Outlook - The upgrade for Mobileye reflects an improvement in its underlying business, with rising earnings estimates expected to drive the stock price higher [5][10]. - Analysts have raised their earnings estimates for Mobileye, with the Zacks Consensus Estimate increasing by 440% over the past three months [8]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with a strong historical performance, particularly for Zacks Rank 1 stocks, which have generated an average annual return of +25% since 1988 [7]. - Mobileye's upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, indicating a strong potential for market-beating returns in the near term [9][10].

Group 1 - Mobileye raised its revenue forecast for fiscal year 2025 to between $1.777 billion and $1.89 billion, up from the previous estimate of $1.7 billion to $1.81 billion, driven by strong demand for autonomous driving chips [2] - In Q2, Mobileye reported revenue of $506 million, exceeding analyst expectations of $481 million, indicating a recovery in chip supply and demand since April 2025, particularly in the Advanced Driver Assistance Systems (ADAS) sector [2] - The company anticipates a more positive growth outlook for the second half of 2025 as automakers resume demand for autonomous driving chips following inventory adjustments, despite remaining cautious about macroeconomic risks [2] Group 2 - Mobileye expects 2027 to be a key growth period, with large-scale commercialization of its EyeQ chip architecture for autonomous driving technology, as multiple automakers plan to launch new models featuring Mobileye SuperVision and Chauffer platforms between 2026 and 2027 [3] - The recent U.S. government tariffs on automobiles and parts are expected to have a limited impact on Mobileye, as most of its chip products are imported directly from Israel by automakers, although potential cost increases could indirectly affect chip demand [3] - Overall, Mobileye's revenue growth outlook reflects a strong recovery in global demand for autonomous driving technology, with the company poised for significant growth in the coming years due to its technological advantages in the ADAS field [3]

Core Viewpoint - Mobileye Global (MBLY) reported quarterly earnings of $0.13 per share, exceeding the Zacks Consensus Estimate of $0.11 per share, and showing an increase from $0.09 per share a year ago [1][2] Financial Performance - The earnings surprise for the quarter was +18.18%, with the company having surpassed consensus EPS estimates three times over the last four quarters [2] - Mobileye's revenues for the quarter ended June 2025 were $506 million, surpassing the Zacks Consensus Estimate by 0.51%, and up from $439 million year-over-year [3] - The company has also topped consensus revenue estimates four times in the last four quarters [3] Stock Performance - Mobileye shares have declined approximately 19.2% since the beginning of the year, contrasting with the S&P 500's gain of 8.1% [4] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [7] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $0.06 on revenues of $436.49 million, and for the current fiscal year, it is $0.32 on revenues of $1.84 billion [8] - The outlook for the automotive industry, where Mobileye operates, is currently in the top 39% of Zacks industries, suggesting a favorable environment for performance [9]

Financial Data and Key Metrics Changes - Q2 revenue increased by 15% year over year, driven by strong demand for the IQ product across regions and OEMs [6][21] - Adjusted operating income rose by 34%, with adjusted operating margin increasing by three points to 21% [6] - Operating cash flow exceeded $200 million for the quarter and over $300 million for the first half, representing about 33% of revenue [7] - Full year revenue outlook raised by 4% and adjusted operating income outlook increased by 14% at the midpoint [7][26] Business Line Data and Key Metrics Changes - The core ADAS business maintained volumes at or above 8.5 million units per quarter for the last four periods [7] - Supervision volumes are expected to reach about 40,000 units at the midpoint, a significant increase from previous expectations [27][46] - The IQ six Lite chip is positioned as the future high-volume chip for the ADAS segment, with systems already deployed in multiple regions [8][9] Market Data and Key Metrics Changes - Demand for advanced products is increasing, with OEMs showing interest in transitioning from single camera programs to multi-camera surround ADAS bundles [10] - The company noted a growing demand from OEMs to consolidate ECUs and integrate technology on a single SoC [10] - The Chinese market showed improved performance, with IQ volumes in 2025 expected to be around 18.1 million units, reflecting a stable demand environment [22][68] Company Strategy and Development Direction - Mobileye is focusing on scaling its Robotaxi operations, with partnerships with OEMs like Volkswagen and demand generators like Uber and Lyft [17][56] - The company aims to leverage its unique technology and partnerships to achieve rapid scalability in the Robotaxi market [17][59] - The strategy includes transitioning from driver-operated vehicles to fully autonomous systems by 2026, with significant revenue expected in 2027 [46][126] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to meet safety and scalability goals for Robotaxi operations [12][13] - The operating environment is viewed positively, with no tangible headwinds anticipated for Q4 volumes [26] - OEMs are increasingly clarifying their planning and decision-making processes, indicating a more favorable outlook for the company's products [18] Other Important Information - The company is maintaining strong working capital discipline, with inventory levels closely monitored [24][90] - Management highlighted the importance of competitive pressure in driving OEMs to adopt new technologies [31][32] - The company is not expecting significant growth in operating expenses in the near future, indicating efficient resource allocation [72] Q&A Session Summary Question: Can you elaborate on the momentum at Chauffeur and the slower decision-making in supervision? - Management noted a lack of competitive pressure in Europe and the U.S., which is causing OEMs to take their time with decisions [31][32] Question: What is driving the increase in supervision volume expectations? - The increase is attributed to better-than-expected vehicle sales from OEMs like Zika and Polestar [45] Question: How do you view the competitive landscape for Robotaxi? - Mobileye sees itself as a unique player in the market, with strong partnerships and a scalable business model [58][59] Question: What is the expected timeline for the launch of supervision and chauffeur programs? - Production for Audi's chauffeur program is expected to start in late 2026, with significant revenue anticipated in 2027 [46] Question: How does the company manage its capital expenditures? - Mobileye has a different philosophy regarding capital expenditures, focusing on efficient compute needs rather than high spending [96][98] Question: What is the lead time for securing awards in Surround Data? - The typical lead time is two to two and a half years from nomination to start of production [116]

Financial Data and Key Metrics Changes - Q2 revenue increased by 15% year over year, driven by strong demand for the IQ product across regions and OEMs [5][20] - Adjusted operating income rose by 34%, with adjusted operating margin increasing by three points to 21% [5] - Operating cash flow exceeded $200 million for the quarter and over $300 million for the first half, representing about 33% of revenue [6][23] - Full year revenue outlook raised by 4% and adjusted operating income outlook increased by 14% at the midpoint [6][25] Business Line Data and Key Metrics Changes - The core ADAS business maintained volumes at or above 8.5 million units per quarter for the last four periods [6] - Supervision volumes are expected to reach about 40,000 units at the midpoint, a significant increase from previous expectations [26][44] - The IQ six Lite chip is positioned as the future high-volume chip for the ADAS segment, with systems already deployed in multiple regions [7] Market Data and Key Metrics Changes - Demand for advanced products is growing, with OEMs shifting from single camera programs to multi-camera surround ADAS bundles [9] - The company noted a lack of competitive pressure in Europe and the U.S., which is slowing OEM decision-making [31] - The China market showed improved performance, with IQ volume growth of around 13% year over year in Q2 [65] Company Strategy and Development Direction - Mobileye is focusing on scaling its Robotaxi operations, with plans for commercial deployment starting in 2026 [15][124] - The company is leveraging partnerships with OEMs like Volkswagen to enhance its market position and scalability [60][61] - The strategy includes a comprehensive product portfolio that addresses various levels of automation, from ADAS to fully autonomous driving solutions [39] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to meet safety and scalability goals for Robotaxi services [12][118] - The overall business environment is seen as favorable, with no tangible headwinds impacting performance [25] - OEMs are increasingly clarifying their planning and decision-making processes, indicating a positive trend for future volumes [18] Other Important Information - The company is maintaining strong working capital discipline, with inventory levels aligned with demand [21][23] - Management highlighted the importance of safety in the development of autonomous driving technologies, with a focus on achieving high mean time between failures (MTBF) [12][128] Q&A Session Summary Question: Can you elaborate on the momentum at Chauffeur and the slower momentum on supervision? - Management noted a lack of competitive pressure in Europe and the U.S., which is causing OEMs to take their time with decision-making [31][32] Question: What is driving the increase in supervision volumes? - The increase is attributed to better-than-expected sales from Zika and Polestar vehicles, indicating the maturity of the supervision system [44][45] Question: How does Mobileye view the competitive landscape for Robotaxi? - Mobileye sees itself as a unique provider capable of offering a full self-driving system, distinguishing itself from competitors like Waymo and Tesla [59][60] Question: What is the expected timeline for the removal of the driver in Robotaxi? - The driver removal is planned for mid-2026 in the first U.S. city, with a focus on scaling teleoperation technology [124] Question: How does Mobileye manage its capital expenditures? - Mobileye has a different philosophy regarding capital expenditures, focusing on efficient compute needs and maintaining a lower CapEx compared to competitors [94][96] Question: What is the timeline for securing contracts in relation to new ADAS standards? - The typical lead time for securing contracts is two to two and a half years, suggesting that OEMs need to secure contracts by 2026 for 2028 standards [112][114]

Financial Performance - Preliminary estimated revenue for the three months ended June 28, 2025, is projected to be between $502 million and $506 million, representing an increase of approximately 14% to 15% compared to $439 million for the same period in 2024 [20]. - Adjusted operating income for the same period is estimated to be between $98 million and $104 million, compared to $79 million in the prior year [20]. - The increase in revenue is primarily attributed to higher customer demand for EyeQ SOC products and the normalization of excess inventory [20]. - The preliminary estimated results are subject to final review and adjustments, and actual results may differ [21]. - The company anticipates preliminary estimated financial results for the three months ended June 28, 2025, which are subject to risks and uncertainties [25]. Stock Offering and Repurchase - Mobileye Global Inc. announced a secondary public offering of 45 million shares of Class A common stock, with an additional 6.75 million shares option for underwriters [4]. - The company plans to repurchase $100 million worth of Class A Stock from the selling stockholder, contingent upon the closing of the offering [5]. - The selling stockholder plans to convert an additional 50 million shares of Class B common stock to Class A Stock, contingent on the offering's closing [8]. Supply Chain and Manufacturing - The company has entered into an agreement with TSMC to manufacture components for its imaging radar and future EyeQ products, enhancing supply chain control [13]. Market Conditions and Risks - The company continues to monitor macroeconomic conditions and potential headwinds from tariffs [20]. - The company’s guidance assumes the estimated production and/or demand impact of current tariff conditions amid ongoing global economic uncertainty [25]. - Regulatory frameworks and changes in trade policy, including increased tariffs, may impact the company's operations in the U.S., Europe, and China [25]. - Detailed risk factors affecting the company's business and results are included in its SEC filings, particularly in the 2024 10-K and Q1 Quarterly Report [25]. Business Continuity and Future Outlook - The company has a business continuity plan in place to address potential impacts from regional conflicts, which it believes will not materially affect short-term business results [12]. - Future consumer demand and behavior, including expectations about excess inventory utilization by customers, are critical factors for the company [25]. - Adverse conditions in Israel, including military operations and conflicts, may affect the company's operations and production capabilities [25]. - The company is evaluating future products and technology, including their expected availability and benefits [25]. - The company is assessing the potential future benefits and competitive advantages associated with its technologies and accumulated data [25]. - The company’s future capital resources and expected returns to stockholders, including dividends, are under consideration [25]. - The company is focused on maintaining or enhancing its leadership position in relevant markets and industries [25].

Core Viewpoint - Adient (ADNT) is currently positioned as a more attractive option for value investors compared to Mobileye Global (MBLY) based on various financial metrics and outlooks [1][3][7] Valuation Metrics - Adient has a Zacks Rank of 1 (Strong Buy), indicating a stronger earnings outlook compared to Mobileye Global, which has a Zacks Rank of 3 (Hold) [3] - The forward P/E ratio for Adient is 11.66, significantly lower than Mobileye Global's forward P/E of 51.98, suggesting that Adient is undervalued relative to its earnings potential [5] - Adient's PEG ratio is 0.66, while Mobileye Global's PEG ratio is 2.07, indicating that Adient's stock is more reasonably priced when considering expected earnings growth [5] - Adient's P/B ratio stands at 0.94, compared to Mobileye Global's P/B of 1.08, further supporting the notion that Adient is a better value investment [6] Value Grades - Adient has received a Value grade of A, while Mobileye Global has a Value grade of D, reflecting the significant differences in their valuation metrics [6]