What happened

In a month when the S&P 500 index dropped a whopping 9%, shares of Ambarella (AMBA -3.86%) were dragged down 12.5%, according to December data from S&P Global Market Intelligence. For perspective, investors should note the move essentially negated a 19% post-earnings pop for Ambarella on the last trading day of November. 

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So what

It's never fun to see shares of any business drop so hard despite a relative lack of company-specific news -- especially considering Ambarella showed notable progress last quarter by securing new automotive and surveillance-camera design wins for its latest computer-vision (CV) chips. In time, Ambarella hopes its early CV-industry gains will more than offset its ongoing transition away from video-processing chips aimed at the stumbling consumer-electronics market.

Nonetheless, when the broader market pulled back last month, it was no surprise to see Ambarella getting hit harder than most in light of its recent gains.

Now what

For now, it's apparent that Ambarella is still facing growth headwinds in these early stages of its CV-centric strategy; its current-quarter guidance calls for revenue of $51 million, plus or minus 3%, which would mark a year-over-year decline of 29%.

But even if Ambarella fails to meet that goal when it next releases quarterly results in early March, I suspect the market will place greater weight on any incremental progress it shows extending its early lead in the CV space.

Check out the latest Ambarella earnings call transcript.