AMBA - Negative article on MF

This seems to be a open access article on the MF site so anyone should be able to link to it.

“Three simple reasons to avoid Ambarella”…


I am not saying that AMBA is a good investment at this time, I actually sold most of my shares after the last earnings as I expect they are going to struggle this year.

However, the article state a couple times that AMBA will have continued revenue concentration with GPRO. I think they even mention 25%? This is from the AMBA CC and they clearly say GPRO will be low single digits of revenue until a new release unless I read this wrong.

I would now like to discuss the outlook for Q1 of fiscal year 2017. We expect revenues for the first quarter of fiscal year 2017 ending on April 30, 2016 to be between $55 million and $57 million, representing a decrease of between 24% and 20%, respectively, from Q1 of last year.
In our December earnings call, we said that we expected a moderate decline in Q1 year-over-year revenues due to inventory adjustments at GoPro. Since that time, the actual demand from GoPro is expected to decline to the low single-digits as a percent of revenue in Q1, with the likelihood that this weakness will continue at similar levels until the launch of any new products with our chip. At this time, we remain cautious until we have a better picture of end user demand in this market.

I understand that losing GPRO revenue is going to hurt, but the article appears incorrect to me. I have stopped reading most of these “articles” on MF free side.



All that negative stuff is already priced in. GPRO is history. I am now looking at a new enterprise: AMBA ex-GPRO. This enterprise is doing quite well and is currently undervalued.