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On Wednesday, JPMorgan maintained a positive outlook on Silicon Labs (NASDAQ:SLAB), reaffirming an Overweight rating and a $160.00 price target. The firm’s analyst highlighted the company’s strong performance in the March quarter, driven by growth in its Industrial & Commercial and Home & Life segments. Silicon Labs’ bookings and orders showed a linear improvement throughout the quarter, indicating a continued cyclical recovery rather than a temporary surge in demand.
For the June quarter, Silicon Labs has forecasted an 8% quarter-over-quarter revenue increase, surpassing consensus expectations. This projection is supported by the momentum from new design wins. InvestingPro analysis indicates a substantial 35% revenue growth forecast for FY2025, with analysts expecting the company to return to profitability this year. JPMorgan anticipates that the company will sustain sequential revenue growth for the rest of 2025, fueled by significant design wins in sectors such as retail, smart cities, and healthcare, including devices like continuous glucose monitors.
The company has also reported a reduction in channel inventories to 48 days, reaching new low levels. This decrease in inventories is expected to provide a multi-quarter revenue tailwind and could positively influence gross margins, which currently stand at 54.12%. InvestingPro analysis reveals that Silicon Labs maintains a strong balance sheet with more cash than debt and a healthy current ratio of 5.17, indicating robust liquidity. For deeper insights into Silicon Labs’ financial health and future prospects, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers. Despite predictions of a weaker macro demand in the second half of the year, JPMorgan has moderated its forward estimates while introducing its calendar year 2026 estimates.
The analyst from JPMorgan noted that, despite a potential downturn in demand, the robust pipeline of design wins should help mitigate the impact, allowing for continued quarter-over-quarter growth. Based on current market prices, InvestingPro’s Fair Value analysis suggests the stock is trading above its intrinsic value, though analyst targets range from $100 to $160, reflecting diverse market opinions. Additionally, gross margins are trending positively, benefiting from a richer mix of industrial and distribution revenue. In light of these factors, JPMorgan has adjusted its estimates but remains steadfast in its December 2025 price target of $160 for Silicon Labs stock, while reasserting its Overweight rating.
In other recent news, Silicon Labs reported its Q1 2025 earnings, surpassing expectations with an earnings per share (EPS) of -$0.08, compared to the forecast of -$0.09. The company’s revenue reached $178 million, exceeding the projected $175.7 million, marking a 67% year-over-year growth. For Q2 2025, Silicon Labs projects revenue between $185 million and $200 million, anticipating a 32% year-over-year growth. Stifel analysts increased their price target for Silicon Labs to $144, up from $120, while maintaining a Buy rating, reflecting confidence in the company’s growth trajectory. Citi analysts also adjusted their price target to $140, maintaining a Neutral rating, citing strong performance in the Home & Life and Industrial & Commercial segments. Silicon Labs introduced new Bluetooth Low Energy SoCs and Matter devices, which position the company well in the competitive IoT market. Management expressed confidence in the company’s ability to outperform the semiconductor industry, with a focus on design win ramps to drive growth. The company’s strategic initiatives and robust financial performance have garnered positive attention from analysts and investors alike.
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