With corporations funneling millions into artificial intelligence (AI), semiconductor stocks have garnered attention as prime beneficiaries of this trend.
Semiconductor firms are grappling with a slowdown in industrial and automotive end markets, and communications infrastructure, while the demand for AI infrastructure remains “remarkably robust, propelled by bullish capex outlooks from major U.S. hyperscalers,” as noted by KeyBanc Capital Markets.
The Semiconductor Off-Season Earnings: This week, three companies are slated to disclose earnings data – Nvidia Corp NVDA, Analog Devices, Inc. ADI, and indie Semiconductor Inc INDI.
The Semiconductor Analyst: John Vinh stood by an Overweight rating on both Analog Devices and indie Semiconductor, maintaining the price targets at $220 and $12, respectively.
Analog Devices
“We expect ADI to report results in-line with expectations, with guidance inline to slightly lower, driven by softening demand in industrial and auto sectors, and ongoing inventory destocking, albeit partially offset by 1Q price hikes,” Vinh expressed in his note.
Expectations for the quarter are as follows:
- Revenue: $2.51 billion compared to a consensus estimate of $2.50 billion
- Earnings: $1.72 per share compared to consensus estimates of $1.71 per share
indie Semiconductor
The company may also unveil results in-line with expectations and provide guidance inline to slightly lower, “owing to increasing weakness in the automotive sector across ICE and EV, with moderate pricing pressure arising from TXN’s price reduction,” as the analyst pointed out.
Anticipated figures for the quarter are:
- Revenue: $73 million, aligning with consensus estimates
- Earnings: Breakeven, as opposed to consensus estimates of a loss of 1 cent per share
Nvidia
The analyst foresees Nvidia posting formidable results, backed by robust demand across all regions except for China, primarily fueled by the upsurge in demand for H100 GPUs.
Projections for the quarter stand at:
- Revenue: $21.0 billion, surpassing consensus estimates of $20.2 billion
- Earnings: $4.72 per share, above consensus estimates of $4.51 per share
NVDA, ADI, INDI Price Action: At the time of publication on Tuesday, shares of Nvidia, Analog Devices, and indie Semiconductor tumbled by 5.92% to $683.40, by 0.17% to $187.93, and by 2.11% to $7.21, respectively.
Read Next: What’s Going On With Intel Stock Tuesday?
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