Ambarella, Inc. (NASDAQ: AMBA) stock lost over 6.6% on September 3rd, 2020 (As of 11:46 am GMT-4; Source: Gogole finance) post 2Q21 performance and weak outlook. For fiscal year of 2021, the revenue fell 8.1% qoq to $50.1 million while lost 11% on a yoy basis, hurt by automotive and other markets. Security camera business rose in the low single digits sequentially but Professional security fell while home security rose sequentially.
The firm’s AI business continued to show growing signs of acceptance with the CV revenue now representing a mid to high single digit percent of total Q2 revenue. Capturing SoC share in a professional security camera market outside of China is witnessing solid design win momentum for CVflow SoCs in professional IP cameras in all geographies, and a very strong pipeline of new customer introductions planned over the next 12 months. The firm has won new OEM design wins generating over $200 million in revenue over the lifetime of their production, typically between two and three years. Non-GAAP net income rose to $2.1 million for $0.06 per share against non-GAAP net income of $1.3 million or $0.04 per share in the first quarter. Cash and marketable securities fell to $410.7 million, against $411.3 million in the first quarter. The firm reported a negative operating cash flow of $2.4 million on the back of rise in operating assets, while current liabilities remained relatively unchanged quarter-over-quarter.
For the third quarter, the firm see revenue in the range of $52 million to $56 million but security camera revenue is expected to be down sequentially with automotive revenue being flat while other revenue expected to rising sequentially. The firm forecasts third quarter non-GAAP gross margin to be in the range of 60% and 62% from 62.4% in the second quarter as customer, product mix and operational control sustain gross margins in the long-term model range of 59% to 62%.