Ambarella (AMBA 58.00, +3.73) has jumped 6.9% in pre-market after beating earnings expectations and guiding in-line.
The company, which manufactures low-power semiconductors for HD and Ultra HD video compression, reported above-consensus third quarter earnings of $0.75 per share on an 11.4% year-over-year decline in revenue to $89.06 million, which was a bit shy of expectations.
Gross margin declined to 64.0% from 66.3% one year ago. The company's third quarter gross margin was a bit better than gross margin over the past nine months (63.8%).
R&D expenses grew 14.8% year-over-year to $29.80 million while selling, general, and administrative expenses increased 9.5% year-over-year to $11.70 million.
Income from operations fell nearly 50.0% year-over-year to $15.44 million.
The company repurchased roughly $12.80 million worth of its shares during the quarter and has room for about $35.00 million worth of buybacks under its current repurchase plan.
Looking ahead, Ambarella expects that fourth quarter revenue will be between $68.00 million and $72.00 million, which encompasses current market expectations. Non-GAAP gross margin is expected between 62.0% and 63.5%.