Shares of Tower Semiconductor (TSEM 1.53%) jumped just over 16.6% in May, according to data from S&P Global Market Intelligence, after the analog integrated circuit manufacturer easily beat analysts estimates for its first quarter.
"The first quarter demonstrated a strong year over year growth," said CEO Russell Ellwanger in a press release. "We are executing well within each of our targeted analog application markets." He also said demand was higher than expected in the company's high-margin business areas, which likely led to the earnings beat.
Analysts were expecting non-GAAP earnings of $0.43 per share, but Tower managed to hit $0.49 EPS, up from just $0.31 in the year-ago quarter. Revenue hit $330 million -- an increase of 19% year over year -- and the company posted record free cash flow of $42 million.
Investors were likely also pleased that the company's gross profit jumped by 38% year over year to $85 million, and operating profit skyrocketed 71% to $53 million.
Ellwanger said that orders from the first quarter should help spur revenue in the second quarter and throughout the rest of the year. "These orders, which will be shipped throughout the next quarters, further strengthen our belief for revenue and margin growth in the year, with our second quarter guidance reflecting the company's highest revenue ever," he said.
Tower Semiconductor issued Q2 revenue guidance with a mid-range of $345 million, which would be a 13% year-over-year increase, with more growth expected through the rest of 2017.