(NASDAQ:AMBA), a fabless semiconductor company known for its video and artificial intelligence (AI) system-on-chips (SoCs), reported notable growth in its Q2 FY2026 results, released on August 28, 2025. Revenue (GAAP) climbed to $95.5 million, marking a 49.9% increase over the prior-year period and surpassing both management’s guidance midpoint and consensus estimates. The company returned to non-GAAP profitability with earnings per share of $0.15, compared to a loss in the previous year. Though gross margins contracted and operating expenses grew, management raised its outlook for fiscal 2026 revenue growth to 31–35%.

Ambarella designs advanced system-on-chip (SoC) semiconductors mainly for video processing and edge artificial intelligence. These SoCs enable AI-powered capabilities in devices including automotive cameras, driver-assistance systems, security devices, and various industrial or robotics applications. The company operates a fabless model, meaning it focuses on design and partner relationships while outsourcing manufacturing, which helps it remain agile and scale in response to demand.

A central focus for the business is leveraging its proprietary CVflow architecture to power AI applications in two key markets: automotive and Internet of Things (IoT). Success in these sectors depends on delivering high performance, low power consumption, and a strong partnership network that helps win multi-year design contracts with equipment manufacturers.

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Source Fool.com