Cirrus Logic Reports Strong Q3 Earnings Driven by Smartphone Demand
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 5d ago
0mins
Should l Buy CRUS?
Source: seekingalpha
Cirrus Logic's stock surged by 11.57% as it crossed above the 5-day SMA, reflecting strong investor confidence following its impressive Q3 earnings report.
The company reported Q3 earnings of $2.97 per share, exceeding analyst expectations of $2.44, and quarterly sales of $580.62 million, surpassing the consensus of $533.89 million. This strong performance was driven by robust demand for smartphone components, particularly from Apple, which accounted for 94% of total revenue. Analysts have also raised their price targets, indicating a positive outlook for Cirrus Logic's future performance.
The strong earnings and optimistic guidance for Q4, projecting sales between $410 million and $470 million, suggest that Cirrus Logic is well-positioned for continued growth. The company's proactive capital management, including share buybacks, further enhances its appeal to investors.
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Analyst Views on CRUS
Wall Street analysts forecast CRUS stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for CRUS is 140.00 USD with a low forecast of 95.00 USD and a high forecast of 155.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
6 Analyst Rating
4 Buy
2 Hold
0 Sell
Moderate Buy
Current: 140.100
Low
95.00
Averages
140.00
High
155.00
Current: 140.100
Low
95.00
Averages
140.00
High
155.00
About CRUS
Cirrus Logic, Inc. is a provider of low-power, high-precision mixed-signal processing solutions that enhance user experience in mobile and consumer applications. Its product line categories are Audio and High-Performance Mixed-Signal (HPMS). It is a supplier of low-power, low-latency, high-precision audio components that are used in a variety of applications, including smartphones, laptops, tablets, virtual reality/augmented reality headsets, wearables, home theater systems, automotive entertainment systems and professional audio systems. Additionally, its SoundClear technology consists of a broad portfolio of tools, software and algorithms that help to differentiate its customers’ products by improving the user experience with features such as louder, high-fidelity sound, high-quality audio playback, voice capture, and hearing augmentation. Its portfolio of HPMS products includes camera controllers for automatic focus and optical image stabilization and haptic and sensing solutions.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Sales Growth: The company achieved quarterly sales of $580.620 million, exceeding the analyst consensus estimate of $533.890 million, demonstrating strong market demand and driving sustained performance growth.
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- Automotive Market Opportunity: Benchmark analysts pointed out significant long-term opportunities for Cirrus Logic in the automotive sector, as the market shifts from centralized transducer designs to Ethernet-based distributed systems, aligning well with the company's portfolio and promising multi-year growth potential.
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- Sales Growth: The company achieved quarterly sales of $580.62 million, exceeding the analyst consensus of $533.89 million, reflecting strong demand for smartphone components that drove overall performance.
- Optimistic Sales Guidance: Cirrus Logic projects Q4 sales between $410 million and $470 million, significantly above market estimates of $384.29 million, indicating confidence in future demand and a positive market outlook.
- Analyst Target Upgrades: Analysts from Benchmark and Stifel maintained a 'Buy' rating on Cirrus Logic, raising their price targets from $150 to $160 and $163 respectively, reflecting a positive outlook on the company's future performance.
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- Eli Lilly's Strong Performance: Eli Lilly's stock surged amidst market volatility, reflecting investor confidence in its growth potential, which may attract more capital into the company.
- Google's Positive Earnings: Following its earnings report, Google's stock rose, showcasing its strong financial performance and future capital spending plans, which could bolster market confidence in tech stocks.
- Capital Expenditure Plans: Google's announcement of substantial capital expenditure plans is expected to drive long-term growth and potentially enhance its market share and competitiveness in the tech sector.
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- Market Divergence: The ongoing rotation out of tech stocks has led to a divided market, yet Eli Lilly's stock surged, indicating strong performance in the current market environment and potentially attracting more investor interest.
- Eli Lilly's Performance: The rise in Eli Lilly's stock reflects optimistic market expectations regarding its future growth potential, particularly due to positive developments in new drug research and market expansion, which may further drive its stock price upward.
- Google's Earnings Bounce: Following its earnings report, Google's stock rose, suggesting investor confidence in its massive capital spending plans, which are expected to drive future revenue growth and market share expansion.
- Capital Expenditure Strategy: Google's capital spending plans are viewed as part of its long-term strategy aimed at enhancing technological infrastructure and innovation capabilities, thereby maintaining a competitive edge in a fiercely contested market.
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Cirrus Logic Reports Strong Q3 Earnings, Shares Surge
- Earnings Beat: Cirrus Logic reported third-quarter earnings of $2.97 per share, surpassing the analyst consensus estimate of $2.44 per share, indicating a significant improvement in profitability and boosting investor confidence.
- Sales Growth: The company achieved quarterly sales of $580.620 million, exceeding the analyst consensus estimate of $533.890 million, demonstrating strong market demand and driving sustained performance growth.
- Stock Surge: Following the positive earnings report, Cirrus Logic's shares jumped 7.6% to $134.10 on Wednesday, reflecting market optimism regarding the company's future growth potential.
- Optimistic Guidance: Cirrus Logic provided fourth-quarter sales guidance that is expected to exceed market estimates, further solidifying its competitive position in the semiconductor industry.
See More
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- Strong Apple Demand: Cirrus Logic reported Q3 revenue from Apple at $546 million, reflecting an 8% increase both quarter-over-quarter and year-over-year, which constituted 94% of total revenue, showcasing improved iPhone unit volumes and mix, leading to a 14% surge in stock price during early trading.
- Doubling PC Revenue: Analysts noted that Cirrus Logic's PC-related revenue is expected to double in fiscal 2026, with management highlighting multiple new device launches and AI PC products currently sampling, which are projected to ramp revenue growth in 2027, enhancing competitive positioning.
- Automotive Market Opportunity: Benchmark analysts pointed out significant long-term opportunities for Cirrus Logic in the automotive sector, as the market shifts from centralized transducer designs to Ethernet-based distributed systems, aligning well with the company's portfolio and promising multi-year growth potential.
- Accelerated Design Activity: Stifel analysts mentioned that design activity across Cirrus Logic's PC portfolio is accelerating, with the latest-generation amplifiers and codecs being ramped up in mainstream platforms, while management has begun sampling new components to enhance voice and audio capture capabilities, addressing the rise of AI-enabled PCs.
See More
Cirrus Logic Reports Strong Q3 Earnings and Upbeat Guidance
- Earnings Beat: Cirrus Logic reported Q3 earnings of $2.97 per share, surpassing analyst expectations of $2.44, indicating a robust improvement in profitability that strengthens market confidence in its financial health.
- Sales Growth: The company achieved quarterly sales of $580.62 million, exceeding the analyst consensus of $533.89 million, reflecting strong demand for smartphone components that drove overall performance.
- Optimistic Sales Guidance: Cirrus Logic projects Q4 sales between $410 million and $470 million, significantly above market estimates of $384.29 million, indicating confidence in future demand and a positive market outlook.
- Analyst Target Upgrades: Analysts from Benchmark and Stifel maintained a 'Buy' rating on Cirrus Logic, raising their price targets from $150 to $160 and $163 respectively, reflecting a positive outlook on the company's future performance.
See More
Wall Street Analysts Adjust Ratings
- Analyst Rating Updates: Top Wall Street analysts have adjusted their ratings on several companies, reflecting the latest market perspectives, although specific company names and rating changes were not detailed.
- Market Reaction Insight: Investors considering buying WDC stock may find analysts' opinions influential in their decision-making, especially in the current market environment where rating changes can trigger stock price fluctuations.
- Impact of Rating Changes: Upgrades and downgrades from analysts typically have a direct effect on a stock's short-term performance, prompting investors to closely monitor these changes to optimize their investment strategies.
- Transparent Information Source: Benzinga provides comprehensive information on analyst rating changes, and while specific ratings were not disclosed, investors can still access more details through their analyst ratings page.
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