The News: Lattice Semiconductor’s revenue for the second quarter of 2022 hit $161.4 million, up 28 percent from $151 million one year ago, as the low-power programmable FPGA maker reported its latest earnings figures on August 1. Read the full Press Release from the Lattice Semiconductor website.
Lattice Semiconductor Q2 2022 Revenue Hits Record $161M
Analyst Take: Lattice Semiconductor’s revenue boost of 28 percent for Q2 2022 to $161.4 million is impressive, as is its 68 percent increase in non-GAAP net income for the quarter. But the most impressive news out of this earnings report is that Lattice Semiconductor has a valuable and in-demand product line that is seeing sustained growth in a turbulent market, with an outlook that expects even greater growth.
Here are Lattice Semiconductor’s Q2 2022 results by the numbers:
- Q2 2022 record revenue of $161.4 million, up 28 percent from $151 million one year ago. The revenue figure topped analyst consensus estimates of $158 million from Yahoo Finance.
- Q2 2022 non-GAAP net income of $59 million, up 68 percent from $35 million one year ago.
- Q2 2022 non-GAAP earnings per share (EPS) of $0.43 per share, up from $0.26 per share one year ago. The EPS beat analyst consensus estimates of $0.40 per share from Yahoo Finance.
- Q2 2022 non-GAAP gross margin of $111 million, up 43 percent from $78 million one year ago.
- Q2 2022 non-GAAP gross margin percentage of 69.1 percent, up from 62 percent one year ago.
Lattice Semiconductor focuses on the low- to mid-tier FPGA market, and it made some very interesting acquisitions in the last year, including Mirametrix in November of 2021. Lattice has increased its focus on software, moving into areas like AI, playing in some interesting spaces such as automotive, industrial, and IoT. Lattice has also partnered with several big chip makers and are seeing more of their chips used per device than ever before.
The company is also gaining sales because there is a benefit to the programmability of its FPGAs, which gives much-needed flexibility to customers. Lattice has also made it possible to make and sell FPGAs affordably, with software that is flexible, which means they are seeing greater adoption of their products by customers across a wide range of industries. That is huge.
We see Lattice Semiconductor now being deservedly recognized in the marketplace. They continue to do everything right, performing well and carving out an important niche in the low-power FPGA space.
Even more important, the company’s focus and product innovations position Lattice Semiconductor well even as difficult global macroeconomic conditions prevail, including the lingering Covid-19 pandemic, continuing supply chain issues, the Russian war in Ukraine, and other disruptions.
In Q2, 73 percent of the company’s business was in Asia, down from 77 percent one year ago. Fourteen percent of the company’s business was in the Americas, unchanged from one year ago, while 13 percent of its business was in Europe and Africa, up from nine percent one year ago.
Lattice Semiconductor’s revenue by end market was 44 percent in communications and computing, up from 42 percent one year ago, and 46 percent in industrial and automotive, down slightly from 45 percent one year ago. The company’s revenue in the consumer market totaled eight percent in Q2, down from 10 percent one year ago, and totaled two percent in the licensing and services market, down from three percent one year ago.
Lattice Semiconductor Outlook for Q3
As part of its Q2 earnings report, Lattice Semiconductor provided earnings guidance for the third quarter of 2022.
- Q3 2022 revenue guidance between $161 million to $171 million.
- Q3 2022 non-GAAP gross margin percentage of 69 percent, plus or minus one percent.
- Q3 2022 non-GAAP total operating expenses between $50 million and $52 million.
We believe that Lattice Semiconductors is in a good place, despite the tough markets for many technology and consumer companies today. With the number of semiconductors in every vehicle continuing to edge upwards, we see this segment as continuing to deliver results for Lattice. In addition, we see more significant investment in everything from more intelligence in rising ADAS levels, infotainment, telematics, and traditional/legacy sensing equipment in the automotive space.
Overall, Lattice is extremely well positioned and has diversified its risk through its broad participation in key seculars including data center, AI, edge, and automotive, and has limited its exposure to consumer technologies, which are most at risk. It will be interesting to watch Lattice Semiconductor through the rest of 2022 and into 2023 as it continues to navigate the turbulent market and world issues facing humanity. We are bullish on the company, its technologies, its products and its outlook for the future.
Disclosure: Futurum Research is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.
Analysis and opinions expressed herein are specific to the analyst individually and data and other information that might have been provided for validation, not those of Futurum Research as a whole.
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Daniel Newman is the Principal Analyst of Futurum Research and the CEO of Broadsuite Media Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise. From Big Data to IoT to Cloud Computing, Newman makes the connections between business, people and tech that are required for companies to benefit most from their technology projects, which leads to his ideas regularly being cited in CIO.Com, CIO Review and hundreds of other sites across the world. A 5x Best Selling Author including his most recent “Building Dragons: Digital Transformation in the Experience Economy,” Daniel is also a Forbes, Entrepreneur and Huffington Post Contributor. MBA and Graduate Adjunct Professor, Daniel Newman is a Chicago Native and his speaking takes him around the world each year as he shares his vision of the role technology will play in our future.