Abstract
Allegro MicroSystems, Inc. will report fiscal Q3 2026 results on January 29, 2026 Pre-Market, and this preview summarizes last quarter’s performance, the company’s guidance dynamics, and consensus expectations for revenue, margins, and adjusted EPS, alongside the prevailing institutional perspective through January 22, 2026.
Market Forecast
For fiscal Q3 2026, market expectations indicate revenue of USD 220.73 million, an adjusted EPS of USD 0.14, and EBIT of USD 33.31 million; the year-over-year forecast growth rates are 25.22% for revenue, 120.05% for adjusted EPS, and 79.72% for EBIT, respectively. The company’s core end-market remains the primary revenue driver, and the outlook highlights stable demand across automotive and industrial sockets with improving mix; the most promising area is the core end-market with USD 214.29 million last quarter and 14.36% year-over-year growth.
Last Quarter Review
In fiscal Q2 2026, Allegro MicroSystems, Inc. reported revenue of USD 214.29 million, a gross profit margin of 46.33%, GAAP net profit attributable to the parent company of USD 6.52 million, a net profit margin of 3.04%, and adjusted EPS of USD 0.13, with year-over-year revenue growth of 14.36% and adjusted EPS growth of 62.50%. A notable highlight was EBIT of USD 29.74 million, which modestly under-ran the estimate but supported margin resilience despite mixed end-market demand. The company’s “core end-market” generated USD 214.29 million in revenue, increasing 14.36% year over year and underpinning broad-based growth momentum across priority applications.
Current Quarter Outlook
Main Business Trajectory
The company’s primary revenue base is the “core end-market,” which encompasses key applications aligned with automotive and industrial sensing and power products. The previous quarter’s USD 214.29 million revenue and 46.33% gross margin suggest consistent execution in pricing discipline, favorable product mix, and an improving cost profile. For fiscal Q3 2026, the forecast revenue of USD 220.73 million implies sequential expansion and a 25.22% year-over-year increase, pointing to momentum in design wins and content growth. Margin dynamics should benefit from scale and mix, with EBIT forecast at USD 33.31 million and adjusted EPS at USD 0.14, both reflecting substantial year-over-year improvements. The net profit margin in the prior quarter at 3.04% underscores cautious expense management and transitional headwinds; a recovery in net margin would be contingent on operating leverage as volumes track higher and as supply-chain costs normalize.
Largest Growth Potential Segment
The “core end-market” remains the largest and most promising segment, given its breadth and stickiness within end customers and platforms. Last quarter’s revenue of USD 214.29 million and 14.36% year-over-year growth indicate healthy demand and ongoing ramp of newer programs. The forecast backdrop points to sustained double-digit expansion supported by broader adoption of sensing and power ICs across target applications. With revenue guided to USD 220.73 million this quarter, the trajectory suggests continued penetration and attach-rate gains in vehicles and industrial systems. The mix is likely skewed toward differentiated products where Allegro MicroSystems, Inc. has competitive strengths, helping support gross margin stability around the mid-40% level even as operating expenses scale to support R&D and customer qualification cycles.
Key Stock Price Drivers This Quarter
Revenue and earnings execution against the forecast will be the primary catalyst for the share price, particularly the degree to which adjusted EPS lands near USD 0.14 and EBIT around USD 33.31 million. Investors will monitor gross margin resilience relative to the prior quarter’s 46.33% to gauge pricing power and product mix evolution. Net profit margin progression from 3.04% last quarter will be important, with operating leverage and any supply chain or logistics cost relief serving as potential tailwinds. Order visibility in the company’s core end-market and commentary on channel inventory should influence sentiment, as will updates on design wins and production ramps that validate the year-over-year revenue growth trajectory of 25.22%. Any indication of sustained double-digit demand across automotive and industrial applications could underpin a positive re-rating, while signs of normalization or inventory digestion would likely compress the outlook.
Analyst Opinions
Cautiously bullish opinions comprise the majority of recent institutional views, pointing to year-over-year step-ups in revenue and earnings with an emphasis on margin stability. Analysts highlight the prospect of achieving USD 220.73 million in revenue alongside EPS of USD 0.14, framing the setup as favorable given product mix and scale benefits. Commentary centers on stable orders across the company’s core end-market and the potential for ongoing price/mix support to maintain gross margin near the mid-40% range. The prevailing view expects EBIT to reach USD 33.31 million and adjusted EPS to improve substantially year over year, suggesting operating leverage is building even as the company invests in R&D and customer programs. These perspectives characterize the quarter as one where execution could validate the growth narrative, with risk management around inventory and end-demand normalization remaining key watch points.Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
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