Tower Semiconductor Ltd. (NASDAQ: TSEM) reported third quarter 2024 revenue growth of 3.4% year-over-year to $370.51 million, slightly exceeding the analyst consensus estimate of $370.33 million.

The Israel-based contract chipmaker’s adjusted EPS of $0.57 beat the analyst consensus estimate of $0.53. The stock price rose after press time.

Gross profit was $93.06 million, up 7.1% year-on-year. The margin improved by 86 basis points to 25.1%. Operating profit of $55.76 million decreased 84.6% year-over-year, with last year’s profit including Intel Corp (NASDAQ:INTC) merger contract termination fees of $314 million.

As of the end of September, the company had generated $125 million in operating cash flow and held $1.21 billion in cash and equivalents.

The company has launched a $350 million investment plan to expand its capacity and improve SiPho (Silicon Photonics) and SiGe (Silicon Germanium) capabilities.

This expansion involves increasing and qualifying for 200mm capacity at its San Antonio and Migdal Haemek sites and at its 300mm factory in Uozu to meet growing customer demand in high-growth markets.

Tower Semiconductor CEO Russell Ellwanger highlighted the company’s consistent quarter-over-quarter revenue growth, including the outlook for the fourth quarter.

He attributed this to strong double-digit year-over-year gains across key technology platforms such as advanced 300mm RF SOI, 65nm Power BCD and next-generation technologies of silicon photonics and silicon germanium.

Ellwanger also mentioned the growing demand for SiGe and SiPho, prompting investments in several factories to increase capacity. This strategic move aims to maintain Tower’s leadership in providing critical components for AI-driven data center markets, particularly optical transceivers.

Outlook: Tower Semiconductor expects fourth-quarter revenue of $387 million, with a 5% range up or down from fourth-quarter revenue of $387 million. $379.23 million consensus.

Tower Semiconductor stock has surged more than 42% since the start of the year.

TSEM Price Action: TSEM stock is up 8.70% at $46.85 premarket at last check Wednesday.

Photo via Wikimedia Commons

“ACTIVE INVESTORS’ SECRET WEAPON” Boost your stock market game with the #1 “news and everything else” trading tool: Benzinga Pro – Click here to start your 14-day trial now!

Get the latest stock analysis from Benzinga?

This item Tower Semiconductor Q3 Results: Higher Revenue, Profit, Plans $350M Expansion originally appeared on Benzinga.com

© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.