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Watch These 4 Semiconductor Stocks for Q2 Earnings: Beat or Miss?
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The semiconductor industry is expected to have met its second-quarter earnings targets, driven by a solid rebound. The industry is continuing its dream run so far this year, which is evident from its growing semiconductor sales.
Per the Semiconductor Industry Association data, global semiconductor sales in May were $41.2 billion, up 4.1% year over year. In April, sales were $46.4 billion, up 15.8% year over year.
The growing proliferation of artificial intelligence (AI), especially generative AI, remains the key growth factor behind this rebound.
Rising demand for Large Language Models, which form the backbone of generative AI, has boosted the demand for advanced AI chips. This is anticipated to have been a major positive for the semiconductor companies.
The explosion of AI in both production processes and final products, which has created tremendous opportunities for chipset manufacturers, is expected to have contributed well to the quarterly performance of the semiconductor stocks.
The data-centric computing architecture, especially cloud computing, the Internet of Things (IoT) and the metaverse, which have expanded the horizon for semiconductors, is anticipated to have benefited the industry players.
The solid adoption of smart devices, which need computing and learning capabilities to perform face detection, image recognition and video analytics capabilities, is likely to have been another positive.
Apart from this, the growing PC shipments are likely to have contributed well to the second-quarter performance of the semiconductor companies. Per Gartner data, the global PC market witnessed 1.9% growth in shipments in the second quarter of 2024 from the prior-year quarter.
Growing demand for AI PCs, which require advanced chips like a graphic processing unit (GPU) and a neural processing unit (NPU), is expected to have acted as a tailwind for the semiconductor stocks.
However, rising macroeconomic uncertainties, persistent inflation, broad-based inventory correction and escalating geopolitical tensions, especially between the United States and China, are expected to have acted as headwinds for the underlined industry in the quarter under review.
Sneak Peek on a Few Upcoming Releases
Let us see how industry players like Amkor Technology (AMKR - Free Report) , Rambus (RMBS - Free Report) , ON Semiconductor (ON - Free Report) and Lattice Semiconductor (LSCC - Free Report) are poised ahead of their quarterly results slated to be reported on Jul 29.
Amkor Technology’s second-quarter 2024 performance is expected to have benefited from production ramp-ups for new products, including the advanced SAP technology and 2.5D technology. Growing demand for IoT wearables is anticipated to have driven consumer end-market sales in the to-be-reported quarter. AI-enabled product introductions by PC vendors are likely to have driven the demand for the company’s 2.5D advanced packaging technology. The integration of AI into edge devices like smartphones is expected to have boosted the demand for advanced packaging solutions.
Growing demand within the Android supply chain and NAND memory, coupled with increasing sales of smartphones, is expected to have driven Amkor Technology’s communications business segment’s sales.
However, the adoption of inventory control measures by customers is likely to have negatively impacted the company’s performance in the automotive and industrial end markets. (Read more: What's in the Offing for Amkor This Earnings Season?)
Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1, 2 (Buy) or 3 increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
For the second quarter, the Zacks Consensus Estimate for AMKR’s revenues is pegged at $1.45 billion, indicating a 0.4% decrease from the year-ago quarter’s actual.
The consensus mark for EPS is pegged at 22 cents, revised downward by a penny over the past 30 days. The estimate indicates a 15.4% decline from the year-ago quarter’s reported figure.
ON Semiconductor is expected to have gained from the increased adoption of its products in the automotive and industrial end markets in second-quarter 2024. Growing momentum in areas such as electric vehicles, advanced driver-assistance systems and energy infrastructure is expected to have been a major positive. The company’s winning market share in the automotive segment, owing to its silicon carbide dominance, and intelligent power and sensing solutions, is likely to have been a tailwind.
ON’s growing investments in high-efficiency power solutions for data centers, driven by the rise of AI, are expected to have contributed well. The company’s shift toward higher-resolution image sensors for Advanced Driver Assistance Systems is likely to have been a plus.
However, mounting expenses associated with investments in silicon carbide ramp and frequent buyouts are anticipated to have impacted the quaterly performance negatively. (Read more: onsemi to Report Q2 Earnings: What's in the Cards?)
ON Semiconductor has an Earnings ESP of 0.00% and a Zacks Rank #3 at present.
For the second quarter, the Zacks Consensus Estimate for ON’s revenues is pegged at $1.73 billion, indicating a 17.3% decrease from the year-ago quarter’s actual.
The consensus mark for ON Semiconductor’s EPS is pegged at 92 cents, which has been unchanged over the past 30 days. The figure indicates a 30.8% decline from the year-ago quarter’s reported figure.
ON Semiconductor Corporation Price and EPS Surprise
Lattice Semiconductor’s second-quarter 2024 results are expected to reflect strong customer momentum on the back of a robust product portfolio and design wins. The company’s expanding portfolio of general purpose and AI-optimized data center servers is expected to have been a major positive in the computing end market. Strength in the Lattice Avant platform is likely to have acted as a tailwind for LSCC in the to-be-reported quarter.
Growing momentum across multiple applications, such as industrial, automation and robotics, advanced driver-assistance systems, and infotainment systems, is expected to have bolstered the company’s presence in the industrial and automotive markets in the second quarter.
However, macroeconomic uncertainties are expected to have been concerning for the company. Weakening demand across industrial and automotive customers in Asia and Europe is likely to have been another negative.
Lattice Semiconductor has an Earnings ESP of 0.00% and a Zacks Rank #3 at present.
For the second quarter, the Zacks Consensus Estimate for LSCC’s revenues is pegged at $130.05 million, indicating a 31.6% decrease from the year-ago quarter’s actual.
The consensus mark for Lattice Semiconductor’s EPS is pegged at 24 cents, which has been unchanged over the past 30 days. The estimate indicates a 53.8% decline from the year-ago quarter’s reported figure.
Lattice Semiconductor Corporation Price and EPS Surprise
Rambus is expected to have gained solid customer momentum in second-quarter 2024 on the back of its diverse portfolio of products, which enable customers to manufacture their electronic and digital products while using specified portions of its patented inventions. The company’s strength in memory interface chips and silicon intellectual properties is anticipated to have contributed well.
The growing momentum in the Gen4 DDR5 Registering Clock Driver, which is part of the company’s memory interface chip portfolio, is likely to have been another positive. This driver is expected to have aided RMBS’s performance in the data center market. It is also anticipated to have helped Rambus gain traction among generative AI-based operations.
However, a challenging macroeconomic environment is expected to have been a major concern.
Rambus has an Earnings ESP of 0.00% and a Zacks Rank #3 at present.
For the second quarter, the Zacks Consensus Estimate for RMBS’s revenues is pegged at $139 million, indicating a 0.2% decrease from the year-ago quarter’s actual.
The consensus mark for Rambus’s EPS is pegged at 42 cents, which has been unchanged over the past 30 days. The figure indicates a 4.6% decline from the year-ago quarter’s reported figure.
Image: Bigstock
Watch These 4 Semiconductor Stocks for Q2 Earnings: Beat or Miss?
The semiconductor industry is expected to have met its second-quarter earnings targets, driven by a solid rebound. The industry is continuing its dream run so far this year, which is evident from its growing semiconductor sales.
Per the Semiconductor Industry Association data, global semiconductor sales in May were $41.2 billion, up 4.1% year over year. In April, sales were $46.4 billion, up 15.8% year over year.
The growing proliferation of artificial intelligence (AI), especially generative AI, remains the key growth factor behind this rebound.
Rising demand for Large Language Models, which form the backbone of generative AI, has boosted the demand for advanced AI chips. This is anticipated to have been a major positive for the semiconductor companies.
The explosion of AI in both production processes and final products, which has created tremendous opportunities for chipset manufacturers, is expected to have contributed well to the quarterly performance of the semiconductor stocks.
The data-centric computing architecture, especially cloud computing, the Internet of Things (IoT) and the metaverse, which have expanded the horizon for semiconductors, is anticipated to have benefited the industry players.
The solid adoption of smart devices, which need computing and learning capabilities to perform face detection, image recognition and video analytics capabilities, is likely to have been another positive.
Apart from this, the growing PC shipments are likely to have contributed well to the second-quarter performance of the semiconductor companies. Per Gartner data, the global PC market witnessed 1.9% growth in shipments in the second quarter of 2024 from the prior-year quarter.
Growing demand for AI PCs, which require advanced chips like a graphic processing unit (GPU) and a neural processing unit (NPU), is expected to have acted as a tailwind for the semiconductor stocks.
However, rising macroeconomic uncertainties, persistent inflation, broad-based inventory correction and escalating geopolitical tensions, especially between the United States and China, are expected to have acted as headwinds for the underlined industry in the quarter under review.
Sneak Peek on a Few Upcoming Releases
Let us see how industry players like Amkor Technology (AMKR - Free Report) , Rambus (RMBS - Free Report) , ON Semiconductor (ON - Free Report) and Lattice Semiconductor (LSCC - Free Report) are poised ahead of their quarterly results slated to be reported on Jul 29.
Amkor Technology’s second-quarter 2024 performance is expected to have benefited from production ramp-ups for new products, including the advanced SAP technology and 2.5D technology. Growing demand for IoT wearables is anticipated to have driven consumer end-market sales in the to-be-reported quarter. AI-enabled product introductions by PC vendors are likely to have driven the demand for the company’s 2.5D advanced packaging technology. The integration of AI into edge devices like smartphones is expected to have boosted the demand for advanced packaging solutions.
Growing demand within the Android supply chain and NAND memory, coupled with increasing sales of smartphones, is expected to have driven Amkor Technology’s communications business segment’s sales.
However, the adoption of inventory control measures by customers is likely to have negatively impacted the company’s performance in the automotive and industrial end markets. (Read more: What's in the Offing for Amkor This Earnings Season?)
Amkor Technology has an Earnings ESP of -1.49% and a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1, 2 (Buy) or 3 increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
For the second quarter, the Zacks Consensus Estimate for AMKR’s revenues is pegged at $1.45 billion, indicating a 0.4% decrease from the year-ago quarter’s actual.
The consensus mark for EPS is pegged at 22 cents, revised downward by a penny over the past 30 days. The estimate indicates a 15.4% decline from the year-ago quarter’s reported figure.
Amkor Technology, Inc. Price and EPS Surprise
Amkor Technology, Inc. price-eps-surprise | Amkor Technology, Inc. Quote
ON Semiconductor is expected to have gained from the increased adoption of its products in the automotive and industrial end markets in second-quarter 2024. Growing momentum in areas such as electric vehicles, advanced driver-assistance systems and energy infrastructure is expected to have been a major positive. The company’s winning market share in the automotive segment, owing to its silicon carbide dominance, and intelligent power and sensing solutions, is likely to have been a tailwind.
ON’s growing investments in high-efficiency power solutions for data centers, driven by the rise of AI, are expected to have contributed well. The company’s shift toward higher-resolution image sensors for Advanced Driver Assistance Systems is likely to have been a plus.
However, mounting expenses associated with investments in silicon carbide ramp and frequent buyouts are anticipated to have impacted the quaterly performance negatively. (Read more: onsemi to Report Q2 Earnings: What's in the Cards?)
ON Semiconductor has an Earnings ESP of 0.00% and a Zacks Rank #3 at present.
For the second quarter, the Zacks Consensus Estimate for ON’s revenues is pegged at $1.73 billion, indicating a 17.3% decrease from the year-ago quarter’s actual.
The consensus mark for ON Semiconductor’s EPS is pegged at 92 cents, which has been unchanged over the past 30 days. The figure indicates a 30.8% decline from the year-ago quarter’s reported figure.
ON Semiconductor Corporation Price and EPS Surprise
ON Semiconductor Corporation price-eps-surprise | ON Semiconductor Corporation Quote
Lattice Semiconductor’s second-quarter 2024 results are expected to reflect strong customer momentum on the back of a robust product portfolio and design wins. The company’s expanding portfolio of general purpose and AI-optimized data center servers is expected to have been a major positive in the computing end market. Strength in the Lattice Avant platform is likely to have acted as a tailwind for LSCC in the to-be-reported quarter.
Growing momentum across multiple applications, such as industrial, automation and robotics, advanced driver-assistance systems, and infotainment systems, is expected to have bolstered the company’s presence in the industrial and automotive markets in the second quarter.
However, macroeconomic uncertainties are expected to have been concerning for the company. Weakening demand across industrial and automotive customers in Asia and Europe is likely to have been another negative.
Lattice Semiconductor has an Earnings ESP of 0.00% and a Zacks Rank #3 at present.
For the second quarter, the Zacks Consensus Estimate for LSCC’s revenues is pegged at $130.05 million, indicating a 31.6% decrease from the year-ago quarter’s actual.
The consensus mark for Lattice Semiconductor’s EPS is pegged at 24 cents, which has been unchanged over the past 30 days. The estimate indicates a 53.8% decline from the year-ago quarter’s reported figure.
Lattice Semiconductor Corporation Price and EPS Surprise
Lattice Semiconductor Corporation price-eps-surprise | Lattice Semiconductor Corporation Quote
Rambus is expected to have gained solid customer momentum in second-quarter 2024 on the back of its diverse portfolio of products, which enable customers to manufacture their electronic and digital products while using specified portions of its patented inventions. The company’s strength in memory interface chips and silicon intellectual properties is anticipated to have contributed well.
The growing momentum in the Gen4 DDR5 Registering Clock Driver, which is part of the company’s memory interface chip portfolio, is likely to have been another positive. This driver is expected to have aided RMBS’s performance in the data center market. It is also anticipated to have helped Rambus gain traction among generative AI-based operations.
However, a challenging macroeconomic environment is expected to have been a major concern.
Rambus has an Earnings ESP of 0.00% and a Zacks Rank #3 at present.
For the second quarter, the Zacks Consensus Estimate for RMBS’s revenues is pegged at $139 million, indicating a 0.2% decrease from the year-ago quarter’s actual.
The consensus mark for Rambus’s EPS is pegged at 42 cents, which has been unchanged over the past 30 days. The figure indicates a 4.6% decline from the year-ago quarter’s reported figure.
Rambus, Inc. Price and EPS Surprise
Rambus, Inc. price-eps-surprise | Rambus, Inc. Quote
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