TLDR
- Semtech Q2 revenue rose 32.7% year-over-year to $341.9 million, beating the $328.67 million estimate
- Adjusted EPS of $0.71 topped the $0.61 estimate, up from $0.41 a year ago
- Q3 guidance of $405-$415 million crushed Wall Street’s $359.9 million estimate
- Multiple analysts raised price targets, with UBS setting the highest at $230
- SMTC holds a Strong Buy consensus; the average $204 price target implies nearly 60% upside
Semtech (SMTC) is trading sharply higher after posting a strong fiscal Q2 beat and issuing Q3 guidance that left analyst estimates in the dust. The stock was up over 10% in premarket trading, building on an already impressive 73% year-to-date gain.
Revenue for the quarter came in at $341.9 million, up 32.7% year-over-year and ahead of the consensus estimate of $328.67 million. It marked the tenth consecutive quarter of revenue growth for the company.
Adjusted EPS hit $0.71, well above the $0.61 analyst estimate and a big jump from $0.41 in the same quarter a year ago.
SEMTECH $SMTC Q2’27 EARNINGS HIGHLIGHTS
🔹 Revenue: $341.9M (Est. $328.6M) 🟢; +33% YoY
🔹 Adj. EPS: $0.71 (Est. $0.61) 🟢
🔹 Adj. EBITDA: $91.1M (Est. $79.6M) 🟢
🔹 Adj. Oper Income: $83.6M (Est. $68.4M) 🟢Q3 Guide:
🔹 Adj. EPS: $1.05 +/- $0.03 (Est. $0.73) 🟢
🔹 Revenue:… pic.twitter.com/fCRlGZhvLi— Wall St Engine (@wallstengine) August 25, 2026
The guidance was the real headline. Semtech expects Q3 revenue of $405 million to $415 million, versus Wall Street’s prior estimate of around $359.9 million. Adjusted EPS guidance of $1.02 to $1.08 also came in well above the $0.73 consensus.
The data-center business is driving a lot of this momentum. Accelerating bookings and a record backlog point to continued growth in that segment.
Analysts Raise Price Targets
UBS analyst Timothy Arcuri raised his price target to $230 from $225 and kept a Buy rating. He pointed to 160%+ year-over-year growth in data-center revenue and ongoing momentum in the LoRa product line. Arcuri sees data-center revenue potentially exceeding $200 million per quarter by Q1 2028.
Roth MKM analyst Scott Searle lifted his target to $220 from $190, also maintaining a Buy. He expects the data-center and LoRa segments to grow 120% year-over-year in Q3 and account for nearly 60% of total revenue.
Benchmark maintained its Buy with a $230 price target. Needham kept its Buy at $200, citing growth in Data Center and LoRa as key drivers behind the raised guidance. Stifel held its Buy rating with a $188 target.
Morgan Stanley Stays Cautious
Not everyone is fully on board. Morgan Stanley analyst Joseph Moore raised his price target to $195 from $175 but kept a Hold rating.
Moore acknowledged strong demand for Semtech’s optical products and rapid data-center revenue growth. He sees the next growth phase coming from active copper cable (ACC) products ramping in Q4 and broader data-center opportunities through FY28.
UBS also flagged that data-center growth should more than offset any revenue impact from Semtech’s cellular module divestiture, while also supporting margin expansion.
On TipRanks, SMTC carries a Strong Buy consensus rating based on 11 Buy ratings and one Hold.
The average price target of $204 implies nearly 60% further upside from current levels. Faster-than-expected FiberEdge qualifications are cited as a key driver of near-term growth, with CopperEdge products adding another opportunity heading into FY28.
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