Chip stocks fall with Nvidia after data center rev disappointment
Investing.com -- Wall Street analysts have initiated coverage of Ambiq Micro (NYSE:AMBQ), the low-power chipmaker seen as a potential key player in the fast-growing edge AI market.
The Austin-based Ambiq, which went public in July, has drawn both bullish and cautious views as analysts point to its proprietary technology and strong positioning, but also a lengthy path to profitability.
Stifel launched coverage with a Buy rating and a $45 target, highlighting Ambiq’s proprietary “SPOT” platform as a key differentiator.
“Based on SPOT’s unique ability to deliver materially better compute performance/watt at the transistor level, we believe Ambiq is positioned to become a key beneficiary of the rapidly-emerging Edge AI market opportunity,” analysts led by Tore Svanberg wrote.
Stifel expects a revenue inflection in 2026, supported by the forthcoming Atomiq platform and a broader customer base.
Ambiq Micro debuted on the New York Stock Exchange last month, closing more than 60% higher after raising $96 million in its initial public offering (IPO).
The Austin-based chip designer, known for ultra-low-power processors, opened at $24 a share and briefly doubled before ending its first session at $38.53, giving it a market value of about $657 million.
After some swings in the weeks that followed, the stock has settled back near those debut levels, currently trading at $38.5.
Others on Wall Street were more measured. UBS initiated at Neutral with a $40 price target, citing the company’s strong positioning in wearables but warning that “profitability will take time with Ambiq only turning profitable in 2028E and even this keyed to the launch of Atomiq.”
The bank flagged execution risks tied to product milestones, while noting Ambiq’s customer base includes Google, Garmin, and WHOOP.
Bank of America also began coverage at Neutral with a $42 target, calling Ambiq a “low-power edge-AI specialist 3+ years from profit.”
The bank highlighted that Ambiq has shipped more than 270 million devices but remains dependent on a few key customers. BofA sees gross margins climbing to about 54% by 2028, the same year analysts expect Ambiq to finally reach profitability.
Despite these concerns, analysts agree that Ambiq holds valuable IP that could secure a larger role in edge computing. Its chips offer 2-5x power savings over traditional designs, a critical advantage for battery-powered devices.
Longer term, the company aims to expand beyond wearables into industrial, healthcare, automotive, and data center applications.
The mixed initiation reflects investor expectations. Analysts see strong technology with a clear edge in AI-related markets, but caution that financial returns are likely still years away.