Lattice Q1 Earnings In-Line With Estimates, Revenues Decline Y/Y

Lattice Semiconductor LSCC reported modest first-quarter 2025 results, with both adjusted earnings and revenues matching the respective Zacks Consensus Estimate. The Hillsboro-based semiconductor company reported revenue contraction year over year, owing to weak demand in multiple end markets and macroeconomic headwinds. Healthy traction in generative AI applications for data centers, in-cabin and advanced driver assistance systems in automotive and augmented reality and virtuality applications partially reversed the declining trends.  Management’s strong focus on expanding the FPGA portfolio through innovations is a tailwind.

Net Income

On a GAAP basis, the company reported a net income of $5.02 million or 4 cents per share, compared with $14.8 million or 11 cents per share in the year-ago quarter. The top-line decline year over year affected the net income.

Non-GAAP net income in the reported quarter was $30.7 million or 22 cents per share compared with $40.3 million or 29 cents per share in the prior-year quarter. However, the bottom line matched the Zacks Consensus Estimate of 22 cents per share. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.) 

Revenues

Net sales in the quarter declined to $120.1 million from $140.8 million in the year-ago quarter. The year-over-year contraction was due to lower sales in several end markets. However, the top line matched our consensus estimate of $120 million.

In the first quarter, Communications and Computing revenues reported first year-over-year growth in two years, rising to $57.4 million. Revenues from Industrial and Automotive declined to $52.2 million from $75.3 million in the prior-year quarter. Total Consumer revenues were $10.6 million, down 2.83% year over year.

Region wise in the first quarter of 2025, the company generated 65% of its revenue from Asia while 25% of the net sales came from the Americas. Europe and Africa contributed 10% of the total revenues.

Other Details

Adjusted EBITDA declined to $40.1 million from $50.3 million in the year-ago quarter. GAAP operating expenses declined to $74.8 million from $79.6 million in the year-ago quarter. 

Cash Flow & Liquidity

In first-quarter 2025, Lattice generated $31.9 million in cash from operating activities compared with $29.5 million in the prior-year quarter. As of March 29, 2025, the company had $127.6 million in cash and cash equivalents with 21.1 million other long-term liabilities.

Outlook

For the second quarter of 2025, Lattice expects revenues in the range of $118.5 million-$128.5 million. Non-GAAP gross margin is anticipated to be in the band of 68%-70%. Non-GAAP total operating expenses are projected to be in the range of $50.5 million-$52.5 million. Non-GAAP income tax rate is expected to be between 5% and 6%. Management forecasts non-GAAP net income to be between 22 and 26 cents per share.

LSCC’s Zacks Rank

Lattice currently carries a Zacks Rank #3 (Hold). 

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Upcoming Releases

Pinterest, Inc. PINS is scheduled to release first-quarter 2025 earnings on May 8. The Zacks Consensus Estimate for earnings is pegged at 25 cents per share, indicating growth of 25% from the year-ago figure. 

Bandwidth Inc. BAND is scheduled to release first-quarter 2025 earnings on May 7. The Zacks Consensus Estimate for earnings is pegged at 29 cents per share, indicating an improvement of 7.41% from the year-ago figure. 

Light and Wonder LNW is scheduled to release first-quarter 2025 earnings on May 7. The Zacks Consensus Estimate for earnings is pegged at $1.17 per share, indicating an improvement of 25.81% from the year-ago figure.

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This article originally published on Zacks Investment Research (zacks.com).

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