The Nasdaq Composite (NASDAQINDEX: ^ IXIC) has been incredibly strong of late, leading the rest of the stock market into a strong bull rally. This continued on Wednesday, with the Nasdaq rising 100 points at 11:30 a.m. EDT and heading for a potential new high.
A few Nasdaq stocks stood out for their performance at the start of the session. Ambarella (NASDAQ: AMBA) released its latest results and made investors very happy with the progress the company has made. During this time, Lucid group (NASDAQ: LCID) fell sharply, although many believe the decline may well be temporary. More details can be found below.
Ambarella’s strategy takes shape
Ambarella shares rose more than 20% on Wednesday morning. The semiconductor chip maker has harnessed the full potential of artificial intelligence, which has made a huge difference in its bottom line and outlook.
Ambarella’s growth has shown the wisdom of his strategic moves. Revenue increased 58% year-over-year in the second quarter, with gross margin up half a percentage point to 62.3%. Adjusted net income increased six-fold to $ 13.1 million, resulting in adjusted earnings of $ 0.35 per share.
In addition, the AI-driven silicon specialist predicts faster growth to come. Third-quarter revenue is expected to be between $ 88 million and $ 90 million, which would represent a growth rate of 57% to 60% compared to the prior year period. This steady growth also bodes well for Ambarella’s long-term trajectory.
As CEO Fermi Wang explained, Ambarella’s choice to embrace the “artificial intelligence of objects” market is paying off both in its existing business and in new growth opportunities, particularly in the field of Internet of Things cameras and the automotive industry. Even facing some challenges due to lingering issues in the supply chain, Ambarella looks set to continue to grow.
Meanwhile, shares of Lucid Group were down about 9% late Wednesday morning after opening down nearly 20%. Lucid’s news had nothing to do with the fundamental business performance of the electric automaker, but rather was about the investment community and access to stocks.
Lucid Group went public earlier this year, merging with special-purpose acquisition company Churchill Capital IV. Under the merger, institutional investors were allowed to make private investments in Lucid at $ 15 per share, on condition that they would be expected to hold their shares for approximately six months from the announcement in late February.
This blocking period expired on Wednesday, allowing these institutional investors to sell their positions if they wished. With the stock closing just below $ 20 a share on Tuesday afternoon, these investors were hoping for a quick 33% return on their investment in the short term. Yet, apparently, many of them were willing to take smaller profits in order to reduce their overall risk.
The Lucid stock has recovered significantly from its worst levels of the day, as fans of the EV stock saw the decline in the stock price as an opportunity to add positions at lower prices. Even with another set of stocks potentially available for sale a year from now, Lucid Bulls are encouraged that the stock has taken this step without taking a more serious hit.
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