10 Best Semiconductor Equipment Stocks to Buy Now

8. Ambarella, Inc. (NASDAQ:AMBA)

Number of Hedge Fund Holders In Q3 2024: 30

Ambarella, Inc. (NASDAQ:AMBA) provides semiconductor equipment and materials that are used in video cameras and image processing solutions. These products mean that the firm performs well when the automotive, industrial, and internet-of-things (IoT) industries are performing well. As a result, Ambarella, Inc. (NASDAQ:AMBA)’s shares have recently started to gain momentum after they were down 1.7% by late November. The tailwinds are from expected improvement in the IoT and industrial sectors, with the firm’s third-quarter earnings accompanied by a $78 million Q4 revenue guide which beat analyst estimates of $69.1 million. During the quarter, Ambarella, Inc. (NASDAQ:AMBA) also grew revenue by 63% annually on the back of strong demand for automotive and IoT products. Looking ahead, continued recovery in these markets could create tailwinds for the firm.

Ambarella, Inc. (NASDAQ:AMBA)’s management commented on its AI products during the Q3 2025 earnings call. Here is what they said:

“Company-specific factors more than offset the overall weakness in the market, with our strength originating from our customers’ new product ramps, especially those incorporating our new higher-priced AI influence processors such as CV5. We again achieved a record level of AI revenue, which in turn contributed to a higher blended average selling price. We are now forecasting fiscal 2025 revenue to increase by 22% to 24% year-over-year versus our prior estimate for revenue growth in the mid- to high teens.

Last quarter, we described our new product momentum as a series of waves and the next year in fiscal 2026, we expect the first wave from CV5 to continue and be augmented with the commitment of the second wave CV7. We expect the first and second new product waves to enable us to grow revenue again in fiscal 2026 with both auto and IoT expected to grow despite the weakness in the overall market. Our CV3 AD family of SoCs for Level 2+ and high level of autonomy represents the third wave with revenue expected to commence in calendar year 2026 or our fiscal 2027. During the third quarter, we received the first silicon of our CV3-AD655 AI SoC, which targets advanced Level 2+ applications, including mass-market passenger vehicles, and we are now delivering engineering samples to customers.”