Ambarella Inc (NASDAQ: AMBA) stock rose over 8.5% in the pre-market session of November 24th, 2020 (Source: Google finance) after the company posted better than expected return for the third quarter of FY 21. The company has reported Non-GAAP net income for the third quarter of fiscal 2021 of $3.3 million compared to adjusted non-GAAP net income of $11.3 million for the same period in fiscal 2020. The company delivered Non-GAAP gross margin for Q3 of 62.7% compared to 62.4% in the preceding quarter and remained above the high-end of the guidance primarily due to customer mix as revenue from the two largest professional security companies in China remained at low levels. Cash and marketable securities had increased to $423.6 million up from $410.7 million at the end of the second quarter. In Q3 the company had generated positive operating cash flow of $13.1 million. Total accounts receivable at the end of Q3 were $24.1 million or 39 days sales outstanding. This is compared to accounts receivable of $23.3 million or 42 days sales outstanding at the end of the prior quarter. Net inventory at the end of the third quarter was $23.7 million compared to $23.9 million at the end of the previous quarter. The days of inventory decreased to 102 days in Q3 from 109 days in Q2.
AMBA in the third quarter of FY 21 has reported the adjusted earnings per share of 9 cents, beating the analysts’ estimates for the adjusted earnings per share of 5 cents, according to the Zacks Consensus Estimate. The company had reported 17.4 percent fall in the adjusted revenue to $56.09 million in the third quarter of FY 21, beating the analysts’ estimates for revenue by 3.70%.
Additionally, during third quarter, the company did not purchase any shares of common stock in Q3. In May, Ambarella’s Board of Directors had approved an extension of the current $50.0 million repurchase program for an additional twelve months ending June 30, 2021. As of today, $49.0 million have remained available from the $50 million repurchase agreement authorized through June 30, 2021.
For the fourth quarter of fiscal year 2021, the company expects revenue to be between $56 million and $60 million, gross margin on a non-GAAP basis is expected to be between 59.0% and 61.0% and operating expenses on a non-GAAP basis are expected to be between $31 million and $33 million.