Ambarella (AMBA) AI Stock Analysis

• Market Cap: $2.81B
• Dividend Yield: N/A
• Average Volume (3M): 529.54K
• Price to Earnings (P/E): ―
• Beta (1Y): 2.16
• Revenue Growth: 44.54%
• EPS Growth: 41.55%
• Country: US
• Employees: 941
• Sector: Technology
• Sector Strength: 86
• Industry: Semiconductors
• EPS (TTM): 0.07
• Shares Outstanding: 42,414,085
• 10 Day Avg. Volume: 489,253
• 30 Day Avg. Volume: 529,538
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.63
• Enterprise Value/Revenue: 5.60
• Enterprise Value/Gross Profit: 9.28
• Enterprise Value/Ebitda: -17.08
• 1Y Price Target: $79.75
• Price Target Upside: 20.80% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 11

• Rating: 59 Neutral
• Price Target: $65.00 ▼(-1.54% Downside)

Ambarella's overall stock score is primarily influenced by strong earnings call performance and technical strength. However, financial performance challenges and high valuation risks weigh down the score. The company's successful AI strategy and product diversification are positives, but geopolitical risks and ongoing losses remain concerns.

Positive Factors

Financial Performance

Ambarella posted better results and guidance, driven by continued adoption of Edge AI SoCs and ASP tailwinds.

Market Expansion

Ambarella is expanding its market by venturing into Edge AI infrastructure, aiming to serve customers with video management servers.

Revenue Growth

Demand for the company’s edge AI inference processors remains strong, leading to a significant increase in revenue guidance.

Negative Factors

Competitive Pressure

AMBA's relatively smaller scale compared to larger competitors is a weakness in the bidding process for Auto programs.

Growth Slowdown

The raised FY26 guidance implies slower growth in the third and fourth quarters and a larger than seasonal decline in the fourth quarter.

Market Risks

Commercializing capability has proven to be a challenge, particularly in the automotive supply chain which is very risk-averse.

Ambarella Business Overview & Revenue Model

Company Description

Ambarella, Inc. develops semiconductor solutions for video that enable high-definition (HD) and ultra HD compression, image processing, and deep neural network processing worldwide. The company's system-on-a-chip designs integrated HD video processing, image processing, artificial intelligence computer vision algorithms, audio processing, and system functions onto a single chip for delivering video and image quality, differentiated functionality, and low power consumption. Its solutions are used in automotive cameras, such as automotive video recorders, electronic mirrors, front advanced driver assistance system camera, cabin monitoring system and driver monitoring system camera, and central domain controllers for autonomous vehicle; and professional and home internet protocol security camera; robotics and industrial application, including identification/authentication cameras, robotic products, and sensing cameras, as well as cameras for the home, public spaces, and consumer leisure comprising wearable body cameras, sports action cameras, social media cameras, drones for capturing aerial video or photographs, video conferencing, and virtual reality applications. The company sells its solutions to original design manufacturers and original equipment manufacturers through its direct sales force and distributors. Ambarella, Inc. was incorporated in 2004 and is headquartered in Santa Clara, California.

How the Company Makes Money

Ambarella generates revenue primarily through the sale of its semiconductor products, including SoCs, which are used in a wide range of applications from drones to security cameras and automotive systems. The company’s revenue model is driven by the sale of integrated circuits and related software to original equipment manufacturers (OEMs) and original design manufacturers (ODMs). Key revenue streams include licensing fees from its proprietary video compression technology, as well as royalties from customers who integrate its technology into their products. Additionally, Ambarella has formed strategic partnerships with major players in the automotive and consumer electronics industries, which help to expand its market reach and drive sales growth. Factors contributing to its earnings also include the increasing demand for high-resolution video and the expansion of AI-driven applications in video processing.

Ambarella Financial Statement Overview

Summary

Ambarella faces significant operational challenges with persistent net losses, affecting overall financial health. Revenue growth and cash flows show positive trends, but profitability remains elusive. The balance sheet is a strength with low leverage and solid equity support.

Income Statement

Ambarella's income statement shows a significant net loss and negative EBIT and EBITDA margins, indicating operational challenges. The TTM revenue shows improvement, but the net profit margin remains negative. Revenue growth is volatile with recent improvement, but sustained profitability remains uncertain.

Balance Sheet

The balance sheet is relatively strong, with a low debt-to-equity ratio suggesting prudent leverage. The equity ratio is healthy, showing strong shareholder investment relative to assets. However, ongoing losses may pressure equity over time.

Cash Flow

Ambarella shows positive operating and free cash flow, improving its cash position. However, the free cash flow to net income ratio is skewed due to persistent net losses. Cash flow management is a positive, but profitability remains a key concern.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	316.26M	284.87M	226.47M	337.61M	331.86M	222.99M
Gross Profit	190.71M	172.33M	136.82M	208.93M	208.13M	135.57M
EBITDA	-103.70M	-100.53M	-129.75M	-54.32M	-15.64M	-49.20M
Net Income	-103.52M	-117.13M	-169.42M	-65.39M	-26.41M	-59.79M
Balance Sheet
Total Assets	701.92M	688.97M	657.65M	710.20M	657.54M	573.28M
Cash, Cash Equivalents and Short-Term Investments	259.39M	250.26M	219.93M	206.86M	171.04M	440.71M
Total Debt	4.39M	5.26M	5.34M	8.64M	11.71M	10.44M
Total Liabilities	129.20M	127.56M	97.78M	104.11M	110.37M	98.30M
Stockholders Equity	572.72M	561.41M	559.87M	606.09M	547.18M	474.98M
Cash Flow
Free Cash Flow	49.77M	23.45M	7.05M	29.04M	29.12M	25.86M
Operating Cash Flow	63.59M	33.84M	19.02M	44.09M	38.80M	30.80M
Investing Cash Flow	-58.81M	-40.53M	7.84M	-107.30M	-119.55M	-31.32M
Financing Cash Flow	5.14M	6.40M	4.51M	5.70M	10.53M	10.40M

Ambarella Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 66.02
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AMBA, the sentiment is Positive. The current price of 66.02 is below the 20-day moving average (MA) of 66.29, above the 50-day MA of 64.42, and above the 200-day MA of 63.08, indicating a neutral trend. The MACD of 0.45 indicates Positive momentum. The RSI at 49.91 is Neutral, neither overbought nor oversold. The STOCH value of 44.50 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AMBA.

Ambarella Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CAMT	73 Outperform	$3.80B	30.78	24.28%	1.60%	27.88%	37.85%
SIMO	70 Outperform	$2.50B	31.00	10.16%	2.68%	-0.29%	1.47%
AMBA	59 Neutral	$2.81B	―	-18.35%	―	44.54%	41.55%
IPGP	59 Neutral	$3.25B	―	-9.89%	―	-14.77%	-261.91%
SLAB	57 Neutral	$4.35B	―	-9.71%	―	29.66%	47.97%
SMTC	57 Neutral	$4.37B	―	-93.41%	―	13.83%	88.14%
Sector *	48 Neutral	C$3.32B	0.26	-6.09%	7.64%	9.19%	-16.12%

Ambarella Corporate Events

Ambarella Holds 2025 Annual Shareholders Meeting

On June 4, 2025, Ambarella, Inc. held its 2025 Annual Meeting of Shareholders, with approximately 85.05% of outstanding shares represented. During the meeting, three Class I directors were elected to serve until the 2028 annual meeting, and the appointment of PricewaterhouseCoopers LLP as the independent registered public accounting firm for the fiscal year ending January 31, 2026, was ratified. Additionally, shareholders approved the executive compensation on a non-binding, advisory basis.

The most recent analyst rating on (AMBA) stock is a Buy with a $90.00 price target. To see the full list of analyst forecasts on Ambarella stock, see the AMBA Stock Forecast page.