Top-performing IPO stock Astera Labs late Tuesday easily beat expectations for the first quarter, also its first as a publicly traded company. Plus, Astera gave guidance above views for the current period. But ALAB stock fell in extended trading.
The Santa Clara, Calif.-based chipmaker earned an adjusted 10 cents a share on sales of $65.3 million in the March quarter. Analysts polled by FactSet had expected earnings of 4 cents a share on sales of $56.7 million. In the year-earlier period, Astera lost an adjusted 12 cents a share on sales of $17.7 million.
For the current quarter, Astera predicted adjusted earnings of 11 cents a share on sales of $72.5 million. That's based on the midpoint of its outlook. Analysts had been looking for earnings of 6 cents a share on sales of $62.8 million.
Astera's Q1 sales growth of 269% year over year was driven by the accelerating AI infrastructure buildout.
Astera Labs makes connectivity chips for cloud and artificial intelligence data centers. Astera's products are focused on high-speed data transfer and overall system bandwidth expansion in data center computing systems.
ALAB Stock Sinks After Report
"As hyperscalers embark on a significant transformation of their data centers to support AI applications with increased capital investment, we're witnessing the emergence of a multiyear growth cycle," Chief Executive Jitendra Mohan said in a news release.
In after-hours trading on the stock market today, ALAB stock tumbled 8.3% to 69.86. During the regular session Tuesday, ALAB stock fell 2.5% to close at 76.19.
Astera Labs started trading on March 20 at an initial public offering price of 36. It notched a record high of 95.21 on March 26 before retreating.
The company's shares are in an IPO base with a buy point of 95.21, according to IBD MarketSurge charts. However, IBD analysis shows an entry of 88.59 from a choppy handle.
ALAB stock is on the IBD Leaderboard watchlist.
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