Semtech (NASDAQ:SMTC) Announces Quarterly Earnings Results

Semtech (NASDAQ:SMTC) issued its earnings results on Tuesday. The semiconductor company reported $0.71 EPS for the quarter, beating the consensus estimate of $0.61 by $0.10, FiscalAI reports. The company had revenue of $341.87 million during the quarter, compared to analysts’ expectations of $328.67 million. Semtech had a net margin of 13.11% and a return on equity of 23.54%. The business’s revenue for the quarter was up 32.7% compared to the same quarter last year. During the same period in the previous year, the company earned $0.41 EPS. Semtech updated its Q3 2027 guidance to 1.020-1.080 EPS.

Here are the key takeaways from Semtech’s conference call:

• Record Q2 results included revenue of $342 million, up 33% year over year, and adjusted EPS of $0.71, up 73%, with operating leverage exceeding revenue growth.
• Management expects Q3 revenue of $410 million at the midpoint, up 54% year over year, driven by a projected 45% sequential increase in data-center revenue as 1.6T CopperEdge and FiberEdge ramp.
• Data-center demand and backlog remain exceptionally strong, with 800G continuing to grow and 1.6T products expected to represent more than half of data-center revenue in Q3; management said more than 70% of next fiscal year’s target revenue is already booked.
• LoRa revenue reached a record $58 million in Q2, up 58% year over year, and is expected to rise another 15% sequentially in Q3, supported by LoRaWAN, LoRa Plus, and Amazon Sidewalk expansion.
• Semtech is pursuing additional front-end and back-end manufacturing capacity for fiscal 2028 and beyond, while the planned cellular-module divestiture is expected to improve gross margin by more than 500 basis points and close in Q4.

Semtech Trading Up 10.4%

Shares of SMTC stock opened at $140.80 on Thursday. Semtech has a twelve month low of $55.18 and a twelve month high of $177.35. The stock’s fifty day simple moving average is $135.94 and its 200 day simple moving average is $118.62. The company has a quick ratio of 1.62, a current ratio of 2.37 and a debt-to-equity ratio of 0.86. The firm has a market capitalization of $13.12 billion, a P/E ratio of 93.25 and a beta of 2.35.

Wall Street Analyst Weigh In

A number of equities analysts have recently commented on the company. New Street Research set a $230.00 price target on Semtech in a report on Thursday, August 20th. Craig Hallum raised their price objective on Semtech from $105.00 to $205.00 and gave the company a “buy” rating in a research note on Wednesday, May 27th. Susquehanna lifted their target price on Semtech from $170.00 to $200.00 and gave the company a “positive” rating in a research report on Wednesday, May 27th. Morgan Stanley boosted their target price on Semtech from $175.00 to $195.00 and gave the stock an “equal weight” rating in a research note on Wednesday. Finally, TD Cowen increased their target price on shares of Semtech from $210.00 to $215.00 and gave the stock a “buy” rating in a report on Monday, June 22nd. Fourteen research analysts have rated the stock with a Buy rating, four have given a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat, the stock presently has a consensus rating of “Moderate Buy” and a consensus price target of $201.44.

Insider Activity

In other news, CFO Mark Lin sold 970 shares of the company’s stock in a transaction that occurred on Wednesday, July 1st. The stock was sold at an average price of $150.41, for a total value of $145,897.70. Following the completion of the transaction, the chief financial officer owned 34,896 shares of the company’s stock, valued at $5,248,707.36. This represents a 2.70% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is available through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Paul V. Walsh, Jr. sold 500 shares of Semtech stock in a transaction that occurred on Wednesday, June 24th. The stock was sold at an average price of $164.99, for a total transaction of $82,495.00. Following the sale, the director owned 28,100 shares in the company, valued at approximately $4,636,219. This represents a 1.75% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last ninety days, insiders sold 21,734 shares of company stock valued at $3,133,986. 0.44% of the stock is currently owned by company insiders.

Institutional Investors Weigh In On Semtech

A number of institutional investors have recently made changes to their positions in SMTC. Smartleaf Asset Management LLC raised its position in shares of Semtech by 24.1% during the second quarter. Smartleaf Asset Management LLC now owns 1,274 shares of the semiconductor company’s stock worth $57,000 after acquiring an additional 247 shares during the last quarter. NewEdge Advisors LLC raised its holdings in Semtech by 1,215.4% during the 3rd quarter. NewEdge Advisors LLC now owns 855 shares of the semiconductor company’s stock worth $61,000 after purchasing an additional 790 shares during the last quarter. Strs Ohio bought a new position in Semtech during the 1st quarter worth approximately $65,000. Daiwa Securities Group Inc. raised its holdings in Semtech by 100.8% during the 4th quarter. Daiwa Securities Group Inc. now owns 1,195 shares of the semiconductor company’s stock worth $88,000 after purchasing an additional 600 shares during the last quarter. Finally, Jones Financial Companies Lllp lifted its position in shares of Semtech by 12,214.3% in the 1st quarter. Jones Financial Companies Lllp now owns 2,586 shares of the semiconductor company’s stock worth $89,000 after purchasing an additional 2,565 shares during the period.

Semtech News Summary

Here are the key news stories impacting Semtech this week:

• Positive Sentiment: Semtech reported fiscal Q2 2027 adjusted EPS of $0.71, above the $0.61-$0.62 analyst consensus, while revenue rose 32.7% year over year to $341.9 million, exceeding estimates of approximately $328.7 million. The quarter marked continued year-over-year earnings growth and record sales. Chipmaker Semtech Smashes Sales, Earnings Targets
• Positive Sentiment: Management issued fiscal Q3 revenue guidance of $405 million to $415 million and adjusted EPS of $1.02 to $1.08, well above Wall Street expectations of roughly $359 million in revenue and $0.69 EPS. The outlook is the main catalyst behind the stock’s rise. Semtech Dumps Cellular Business to Double Down on Data Centers
• Positive Sentiment: The earnings call highlighted a 91% increase in data-center sales, demand tied to artificial-intelligence infrastructure, a ramp toward 1.6-terabit connectivity, record backlog and capacity expansion. Management also pointed to LoRa growth and potential margin improvement following its planned cellular-business divestiture. SMTC Q2 Earnings Call Spotlights 1.6T Data Center Growth
• Positive Sentiment: Analysts reaffirmed Buy ratings and raised or maintained price targets, including targets of $200, $215 and $230, citing data-center growth, profitability upside and margin expansion. Unusually heavy call-option activity also signaled bullish short-term trading interest.
• Neutral Sentiment: The cellular-business divestiture represents a strategic shift toward higher-growth data-center markets, but execution, supply constraints and the need to convert backlog into sustained revenue remain important risks for investors.
• Negative Sentiment: Reported insider trading data showed company executives made multiple sales and no purchases during the past six months. While such transactions may be routine, the selling provides a modest counterpoint to the otherwise favorable earnings news. Semtech Posts Record Sales in Fiscal Q2

About Semtech

Semtech Corporation is a leading supplier of high-performance analog and mixed-signal semiconductors and advanced algorithms. The company’s products address a broad range of applications in the Internet of Things (IoT), data center and telecom, industrial, home automation, automotive, and aerospace markets. Semtech’s portfolio includes power management, signal integrity, protection devices, wireless and sensing technologies that enable smarter, more connected systems worldwide.

A core offering from Semtech is its LoRa® technology, a low-power, long-range wireless communication platform that has become a de facto standard for global IoT deployments.