Lattice's Q3 Earnings Meet Estimates on Higher Revenues

Core Insights - Lattice Semiconductor (LSCC) reported third-quarter 2025 results that met Zacks Consensus Estimates for both revenue and net income, driven by growth in the AI server market and a focus on expanding its FPGA portfolio through innovation [1][8]. Financial Performance - The company reported a GAAP net income of $2.79 million or 2 cents per share, down from $7.19 million or 5 cents per share in the same quarter last year, primarily due to higher operating expenses [2]. - Non-GAAP net income for the quarter was $38.15 million or 28 cents per share, an increase from $32.54 million or 24 cents per share year-over-year, matching the Zacks Consensus Estimate [2]. Revenue Breakdown - Net sales increased to $133.34 million from $127.09 million in the prior-year quarter, supported by strong growth in the Communications & Computing segment, aligning with the consensus estimate of $133 million [3][8]. - Communications and Computing revenues rose to $74 million from $61 million, attributed to normalized inventory and robust demand in the AI server market [4]. - Revenues from the Industrial and Automotive segment decreased to $50.3 million from $54.2 million, impacted by higher channel inventory levels, while Consumer revenues fell to $9 million from $11.9 million [4]. Geographic Revenue Distribution - In Q3 2025, 65% of the company's revenue was generated from Asia, 19% from the Americas, and 16% from Europe and Africa [5]. Operational Metrics - Adjusted EBITDA increased to $47.4 million from $42.5 million year-over-year, while GAAP operating expenses rose to $92.1 million from $80.2 million [5]. Cash Flow and Outlook - For the first nine months of 2025, Lattice generated $117.5 million in cash from operating activities, up from $95.4 million in the prior-year period. As of September 27, 2025, the company had $117.9 million in cash and cash equivalents [6]. - The company anticipates Q4 2025 revenues in the range of $138-$148 million, with a non-GAAP gross margin expected between 68.5%-70.5% and non-GAAP net income projected at 30-34 cents per share [6][8].