Published on 30 Apr 2024 on Zacks via Yahoo Finance
4 Semiconductor Stocks' Earnings Coming Up: What to Expect
The global semiconductor industry is undergoing a remarkable transformation in 2024, fueled by advancements in AI chipsets, data center GPUs, chiplets and next-generation memories. This evolution is unlocking unprecedented possibilities across various sectors, from automotive and high-performance computing (HPC) to consumer electronics and healthcare.Sales data from the Semiconductor Industry Association reflects this trend, with semiconductor sales showing strong year-over-year growth of 16.3% and 15.2%, respectively, in February and January.Generative AI, along with advancements in chiplet technology, is driving demand for specialized AI chips, essential for large language models. These chips are essential for handling intensive parallel processing tasks, leading to increased demand from cloud service providers, researchers, and creative firms. Chiplets, with their modular design and superior performance, are revolutionizing the industry by reducing costs and increasing scalability.An uptick in PC shipments and signs of recovery in memory spending, particularly in NAND and DRAM, are expected to have contributed to the sector's momentum. In the first quarter of 2024, global PC shipments grew 1.5% year over year, driven by AI PCs and semiconductor advancements. According to the International Data Corporation (IDC) report, 59.8 million units were shipped in the first quarter of 2024, which marked a return to pre-pandemic levels.In 2024, next-generation memory technologies such as High Bandwidth Memory (HBM), a graphics DDR memory known for its high performance, capacity, low latency, and energy efficiency, have become a market leader. Samsung, SK Hynix, and Micron are dominating the HBM market and there are plans to launch HBM3e and potentially HBM4 in the coming years.Despite the industry's growth, challenges such as talent shortages persist. Layoffs in major companies like Intel and Qualcomm underscore the need for a specialized workforce. However, significant growth opportunities, particularly in the integrated circuit (IC) and memory IC segments are expected to have driven growth in the semiconductor industry.
Insight Into Key Releases
Investors interested in the semiconductor industry are eagerly awaiting the quarterly earnings releases of players like Qorvo QRVO, Wolfspeed WOLF, Monolithic Power Systems MPWR and Advanced Energy Industries AEIS, scheduled to be released on May 1.Per the Zacks model, a company needs to have the right combination of two key ingredients — a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) — to increase the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.You can see the complete list of today's Zacks #1 Rank stocks here.Qorvo: This top supplier of radio frequency solutions is anticipated to have experienced revenue expansion fueled by robust demand within the Advance Cellular Group (ACG). It is supported by the rollout of state-of-the-art solutions targeting burgeoning markets like electric vehicles, energy storage, and solar power applications. The transition from legacy mechanical systems to active electronics scanning systems is driving growth in the defense and aerospace business. Growing demand for DOCSIS 4.0 hybrid power doublers is supporting growth in the infrastructure business. Management's approach of blending innovation with strategic acquisitions to fortify the product lineup is seen as a favorable move. (Read more: Will Top Line Expansion Boost Qorvo's Q4 Earnings?)The Zacks Consensus Estimate for QRVO’s fourth-quarter fiscal 2024 earnings per share is pegged at $1.21 per share, unchanged over the past 30 days. The Zacks Consensus Estimate for total revenues is pegged at $925.44 million, suggesting 46.3% growth from the year-ago quarter.The combination of a Zacks Rank #3 and an Earnings ESP of 0.00% makes surprise prediction difficult. The company’s earnings beat estimates in the trailing four quarters, the average surprise being 76.41%.