SMTC Set to Report Q2 Earnings: What's in the Cards for the Stock?

Semtech Corporation SMTC is scheduled to report second-quarter fiscal 2027 results on Aug. 25.

For the fiscal second quarter, Semtech anticipates revenues to be $328 million (+/- $5 million). The Zacks Consensus Estimate for revenues is pegged at $328.4 million, indicating a rise of 27.5% from the year-ago quarter.

SMTC expects non-GAAP earnings per share to be 61 cents (+/- 2 cents). The consensus mark for the same is pegged at 62 cents, unchanged over the past 60 days, indicating a year-over-year rise of 51%.

Factors to Consider for SMTC Stock

Semtech’s performance in the to-be-reported quarter is likely to have benefited from continued momentum across its infrastructure, industrial and high-end consumer end markets. The company’s data center business remains a key growth driver as demand for high-speed optical and copper interconnect solutions accelerates alongside the expansion of artificial intelligence infrastructure.

Semtech Corporation Price and EPS Surprise

Semtech Corporation price-eps-surprise | Semtech Corporation Quote

Increasing adoption of FiberEdge products and the transition to next-generation 1.6T architectures are expected to have supported growth in the to-be-reported quarter. The broader evaluation and deployment of CopperEdge solutions for active copper cable and onboard linear equalizer applications could have further strengthened the company’s data center opportunity.

LoRa is also expected to have remained an important contributor to Semtech’s industrial business. Broader deployments across utilities, smart buildings, smart cities and asset management are likely to have supported demand. The company’s efforts to expand LoRa into multi-protocol applications through LoRa Plus could have strengthened its addressable market, while growing design-win momentum and emerging consumer applications are expected to have provided additional support in the to-be-reported quarter.

Semtech’s high-end consumer business is likely to have benefited from increasing content per premium handset, continued gains in protection products and expanding sensing opportunities. Improving seasonal demand in the second quarter might have provided an additional tailwind. The company’s efforts to extend its protection franchise into power-delivery applications and to broaden its sensing portfolio are also expected to have supported growth.

Semtech’s optical roadmap might have benefited from the integration of HieFo, which expands its photonics capabilities for next-generation optical applications. Continued investment in coherent optics, co-packaged optics initiatives, LoRa and sensing is likely to have strengthened its long-term product pipeline.

What Our Proven Model Says for SMTC’s Q2 Earnings

According to the Zacks model, the combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

Semtech has an Earnings ESP of 0.00% and carries a Zacks Rank #2 at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are some stocks you may want to consider in the broader Zacks Computer and Technology sector, as our model shows that these have the right combination of elements to post an earnings beat:

Dell Technologies DELL has an Earnings ESP of +6.42% and sports a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Dell Technologies is slated to report second-quarter fiscal 2027 results on Sept. 1. The Zacks Consensus Estimate for DELL’s second-quarter earnings is pegged at $4.88 per share, down by a penny over the past 30 days, indicating a rise of 110.3% from the year-ago quarter’s reported figure.

Hewlett Packard Enterprise HPE has an Earnings ESP of +9.96% and carries a Zacks Rank #2 at present.

Hewlett Packard is set to report third-quarter fiscal 2026 results on Sept. 2. The Zacks Consensus Estimate for HPE’s third-quarter earnings is pegged at 94 cents per share, up by a penny over the past 30 days, indicating a rise of 113.6% from the year-ago quarter’s reported figure.

Intuit INTU has an Earnings ESP of +0.08% and carries a Zacks Rank #3 at present.

Intuit is set to report fourth-quarter fiscal 2026 results on Aug. 25. The Zacks Consensus Estimate for INTU’s fourth-quarter earnings is pegged at $3.59 per share, unchanged over the past 30 days, indicating a rise of 30.6% from the year-ago quarter’s reported figure.  

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

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