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Ambarella’s $8.5 Billion To $22.9 Billion TAM Expansion — Can It Convert?

Ambarella, Inc. reported its financial results for the second quarter of fiscal year 2027 with revenue reaching $108.1 million, slightly above the midpoint of its guidance and representing increases of 7.7% sequentially and 13.2% year-over-year. The company’s performance was driven by record edge AI revenue and growth in both its Internet of Things (IoT) and automotive markets, particularly from commercial vehicle applications. Automotive revenue slightly outpaced IoT growth, and non-GAAP earnings per share stood at $0.18. The company’s non-GAAP gross margin was 59.3%, marginally below prior guidance, while non-GAAP operating expenses aligned near the midpoint of expectations. Cash and marketable securities totaled $272.3 million, slightly decreased from the previous quarter but up year-over-year. Inventory levels rose in days of inventory despite dollar declines, and operating cash flow had a minor outflow for the quarter.