Arteris, Inc. (NASDAQ:AIP) Just Reported First-Quarter Earnings: Have Analysts Changed Their Mind On The Stock?

Investors in Arteris, Inc. (NASDAQ:AIP) had a good week, as its shares rose 3.7% to close at US$7.51 following the release of its quarterly results. It looks like a positive result overall, with revenues of US$17m beating forecasts by 3.8%. Statutory losses of US$0.20 per share were roughly in line with what the analysts had forecast. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

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After the latest results, the four analysts covering Arteris are now predicting revenues of US$68.5m in 2025. If met, this would reflect a meaningful 12% improvement in revenue compared to the last 12 months. The loss per share is expected to ameliorate slightly, reducing to US$0.72. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$68.4m and losses of US$0.72 per share in 2025.

View our latest analysis for Arteris

As a result there was no major change to the consensus price target of US$11.75, implying that the business is trading roughly in line with expectations despite ongoing losses. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Arteris, with the most bullish analyst valuing it at US$16.00 and the most bearish at US$8.00 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's clear from the latest estimates that Arteris' rate of growth is expected to accelerate meaningfully, with the forecast 16% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 8.2% p.a. over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 13% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Arteris is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that the analysts reconfirmed their loss per share estimates for next year. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at US$11.75, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Arteris analysts - going out to 2027, and you can see them free on our platform here.

Don't forget that there may still be risks. For instance, we've identified 3 warning signs for Arteris (1 is a bit unpleasant) you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.