Ambarella (AMBA) shares experienced a significant pre-market plunge of 11.07% on Friday.
The sharp decline follows the semiconductor company's release of its latest quarterly financial results and forward-looking guidance. While Ambarella reported fourth-quarter revenue that slightly exceeded analyst expectations, investors reacted negatively to the company's projection that revenue growth would slow to a range of 10% to 15% for the current fiscal year. This guidance represents a notable deceleration from the 37% revenue growth the company achieved in the previous fiscal year.
CEO Fermi Wang highlighted that edge artificial intelligence systems-on-chips represented a majority of the company's overall revenue. Despite the strong performance in edge AI and improved quarterly results, the market focused on the anticipated slowdown in growth momentum, driving the stock lower in extended trading sessions.
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