Shares of chip designer Lattice Semiconductor Corp. (LSCC +4.77%) tumbled today after the company reported second-quarter results that were below expectations.
Revenue and earnings both fell short of Wall Street's estimates, spurring some investors to ditch their Lattice shares and sending the tech stock falling 8.4% as of 2:06 p.m. ET.
Disappointing second-quarter results
Lattice reported non-GAAP (adjusted) earnings per share of $0.23 for the second quarter, down 56.7% from the year-ago quarter. The drop was disappointing enough, but it was made worse considering that the analysts' consensus estimate was for $0.24 per share in the quarter.
NASDAQ: LSCC
Key Data Points
The bad news kept coming for Lattice, with second-quarter revenue down 35% to $124.1 million -- missing Wall Street's average estimate of $130.1 million. Lattice's management noted that cyclical issues in the semiconductor industry were to blame for the slowdown. Interim CEO Esam Elashmawi said: "Second quarter 2024 results reflect the impact of cyclic industry headwinds. While the industry continues to go through a period of inventory normalization, we are starting to see signs of improvement."
Management tried to highlight the "durability" of Lattice's business model by pointing to the fact that the gross margin was relatively stable in the quarter, dipping slightly to 68.3% from 69.7% in the year-ago quarter.
But investors couldn't look past the disappointing sales and earnings declines.
Revenue outlook indicated more weakness
Lattice's management issued a third-quarter revenue outlook of $117 million to $137 million, which represents a 33.8% decline from Q3 2023 sales at the midpoint of guidance.
While some investors have hoped Lattice could be a strong contender in the artificial intelligence space, its stock has yet to deliver. Lattice shares are down 44% over the past 12 months and the company's lackluster sales outlook isn't spurring any new optimism.
