Semtech Corporation’s stock surged more than 4% in premarket trading after the chipmaker reported fiscal Q2 results that exceeded analyst expectations on both earnings and revenue.
The company posted adjusted earnings per share of $0.71, topping the $0.61 consensus estimate by 16%. Revenue reached a record $341.9 million, up 33% from $257.6 million in the same quarter last year and surpassing the $328.64 million forecast. Adjusted gross margin expanded to 54.5%, while adjusted operating margin rose to 24.4%, compared with 20.4% in the prior quarter.
Semtech’s Q3 guidance further bolstered investor confidence. The company expects adjusted earnings per share between $1.02 and $1.08, well above the $0.73 consensus. Revenue is projected at $405 million to $415 million, compared with the $379 million estimate. Adjusted operating margin is forecast at 31.0%, plus or minus 60 basis points.
Morgan Stanley analysts highlighted accelerating optical demand and a 1.6 terabit ramp as key drivers, noting rapid margin improvement and visibility extending into fiscal 2028. Hong Hou, president and CEO, cited record revenue across core areas, earnings leverage outpacing revenue growth, and portfolio optimization progress. He added that accelerating bookings and a record backlog signal a strong inflection in growth.
The company’s outlook points to continued momentum, with active copper cable ramps expected in the fourth quarter and broader data center opportunities building into fiscal 2028.
