Semtech Slides Despite Record Q1 Sales: 4 Analysts Maintain Ratings

Core Viewpoint - Semtech Corp reported strong first-quarter results, but its shares declined by 5.8% despite positive earnings and revenue growth [1][8]. Financial Performance - Semtech's revenues reached $251.1 million, exceeding consensus estimates of $250.1 million, with earnings per share at 38 cents, above the expected 37 cents [4]. - The company experienced a year-on-year revenue increase of 22%, with Data Center sales soaring by 143% [6]. - Gross margins improved to 53.5%, slightly above the projected 53.0% [4]. Segment Performance - The Infrastructure segment saw a sequential sales growth of 5% and a year-on-year increase of 30%, totaling $72.8 million [2]. - Data Center sales contributed significantly, growing 3% sequentially and 143% year-on-year to $51.6 million [2]. Profitability and Guidance - Non-GAAP operating margins are expected to expand from 16.4% in fiscal 2025 to 20.2% in fiscal 2027 [3]. - Management provided guidance for earnings of 40 cents per share on revenues of $256 million, slightly above market expectations [5]. - The company anticipates sequential growth in its infrastructure and consumer segments, with industrial sales expected to remain flat or slightly decline [5]. Analyst Ratings and Price Targets - Analysts have maintained positive ratings, with Stifel raising its price target from $42 to $45, and Piper Sandler maintaining a target of $55 [9]. - Roth Capital Partners reaffirmed a Buy rating with a price target of $65, while Cantor Fitzgerald set a target of $54 [9].