As the Q1 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the processors and graphics chips industry, including Allegro MicroSystems NASDAQ:ALGM and its peers.
The biggest demand drivers for processors (CPUs) and graphics chips at the moment are secular trends related to 5G and Internet of Things, autonomous driving, and high performance computing in the data center space, specifically around AI and machine learning. Like all semiconductor companies, digital chip makers exhibit a degree of cyclicality, driven by supply and demand imbalances and exposure to PC and Smartphone product cycles.
The 9 processors and graphics chips stocks we track reported a very strong Q1. As a group, revenues beat analysts’ consensus estimates by 2.9% while next quarter’s revenue guidance was 4.2% above.
Luckily, processors and graphics chips stocks have performed well with share prices up 43.7% on average since the latest earnings results.
Allegro MicroSystems NASDAQ:ALGM
The result of a spinoff from Sanken in Japan, Allegro MicroSystems NASDAQ:ALGM is a designer of power management chips and distance sensors used in electric vehicles and data centers.
Allegro MicroSystems reported revenues of $243.2 million, up 26.1% year on year. This print exceeded analysts’ expectations by 3.2%. Despite the top-line beat, it was still a mixed quarter for the company with a decent beat of analysts’ operating income estimates but a significant miss of analysts’ EPS estimates.
“We finished fiscal year 2026 with strong momentum, delivering a fifth consecutive quarter of sales growth at $243 million. Non-GAAP EPS nearly tripled year-over-year to $0.17. For the full year, sales grew 23% to $890 million and non-GAAP EPS more than doubled to $0.54. These results reflect strength in Focus Auto sales - including xEV and ADAS – and Data Center, which reached a record 14% of total Q4 sales,” said Mike Doogue, President and CEO of Allegro MicroSystems.
Interestingly, the stock is up 14.3% since reporting and currently trades at $58.73.
Best Q1: Lattice Semiconductor NASDAQ:LSCC
A global leader in its category, Lattice Semiconductor NASDAQ:LSCC is a semiconductor designer specializing in customer-programmable chips that enhance CPU performance for intensive tasks such as machine learning.
Lattice Semiconductor reported revenues of $170.9 million, up 42.2% year on year, outperforming analysts’ expectations by 3.6%. The business had a stunning quarter with a significant improvement in its inventory levels and a beat of analysts’ EPS estimates.
The market seems happy with the results as the stock is up 10% since reporting. It currently trades at $138.07.
Slowest Q1: Qualcomm NASDAQ:QCOM
Having been at the forefront of developing the standards for cellular connectivity for over four decades, Qualcomm NASDAQ:QCOM is a leading innovator and a fabless manufacturer of wireless technology chips used in smartphones, autos and internet of things appliances.
Qualcomm reported revenues of $10.6 billion, down 2.2% year on year, in line with analysts’ expectations. It was a slower quarter as it posted revenue guidance for next quarter missing analysts’ expectations significantly and an increase in its inventory levels.
Qualcomm delivered the weakest performance against analyst estimates and weakest guidance update in the group. Interestingly, the stock is up 22.9% since the results and currently trades at $191.65.
Qorvo NASDAQ:QRVO
Formed by the merger of TriQuint and RF Micro Devices, Qorvo NASDAQ:QRVO is a designer and manufacturer of RF chips used in almost all smartphones globally, along with a variety of chips used in networking equipment and infrastructure.
Qorvo reported revenues of $808.3 million, down 7% year on year. This print surpassed analysts’ expectations by 1%. Overall, it was a very strong quarter as it also put up a beat of analysts’ EPS and operating income estimates.
Qorvo had the slowest revenue growth among its peers. The stock is down 1.6% since reporting and currently trades at $94.83.
Intel NASDAQ:INTC
Inventor of the x86 processor that powered decades of technological innovation in PCs, data centers, and numerous other markets, Intel NASDAQ:INTC is a leading manufacturer of computer processors and graphics chips.
Intel reported revenues of $13.58 billion, up 7.2% year on year. This result beat analysts’ expectations by 9.6%. It was an exceptional quarter as it also produced a beat of analysts’ EPS and operating income estimates.
Intel pulled off the biggest analyst estimate beat and highest guidance raise among its peers. The stock is up 93% since reporting and currently trades at $128.94.