Shares of silicon timing components specialist SiTime (SITM +26.58%) raced to a double-digit gain on Thursday. Investors were reacting to an impressive second-quarter earnings report published by the company after market close the previous day. Its stock closed the day nearly 27% higher.
Soaring fundamentals
SiTime earned net revenue of $157.4 million, more than double the $69.5 million it posted in the same quarter of 2025. This was led by the white-hot communications, enterprise, and data center end market, currently in the midst of feverish build-outs of artificial intelligence (AI) capacity; this segment's revenue grew by 181%.
Image source: Getty Images.
The company's two other end markets, automotive, industrial, and aerospace, and consumer, mobile, and Internet of Things (IoT), each increased by over 50%. SiTime did not get more specific in its earnings release.
Such improvements were also reflected in profitability. Net income not under generally accepted accounting principles (non-GAAP, or adjusted) quintupled and then some to $65.6 million, or $2.34 per share.
Pundits tracking the company's stock were modeling only $146.3 million for net revenue and adjusted net income of $1.96 per share.
NASDAQ: SITM
Key Data Points
What a difference a year makes
In the conference call discussing the results, SiTime provided guidance for its current (third) quarter. The company believes its net revenue will hit $285 million to $295 million, and adjusted net earnings will come in at $3.50 to $3.65 per share.
Even the low ends of those ranges are far higher than the third quarter 2025 results of $84 million for net revenue, and adjusted earnings per share (EPS) of $0.87. This is due to both continued growth from the legacy business, and the incorporation of the recently acquired timing products division of Japanese peer Renesas.
On Thursday, investors discovered just how good a pick-and-shovel play SiTime is on the AI data center phenomenon and acted accordingly. That's left the stock rather expensive in both price and valuations. While I'm sure it still has some room to run, it might be wise to search for similar pick-and-shovel AI plays that are more modestly priced.
