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AMBA, Ambarella

Semiconductors asset-light Unprofitable

Ambarella is a leading developer of low-power system-on-a-chip, or SoC, semiconductors and software for edge and physical artificial intelligence applications and intelligent automation.

Our technologies make electronic systems smarter, enabling them to become partially or fully autonomous with features such as intelligent automation, complex scene understanding, and autonomous decision-making.

We specialize in the development of deployable, scalable designs for intelligent electronic systems that utilize high-bandwidth sensors offering a proven path to mass production.

Latest annual: FY2026 10-K

AMBA · Ambarella

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2026

$391M

+37.2% YoY · 12% 5-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $405M 5-yr avg $314M

Gross margin 59% 5-yr avg 61%

Operating margin −18.8% 5-yr avg −32.9%

ROIC −12% 5-yr avg −18%

Owner-earnings margin 4% 5-yr avg 9%

Free cash flow margin 4% 5-yr avg 9%

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

Situation: Unprofitable. No sustained operating profit across the record; an earnings multiple has nothing to rest on. What the record does show is revenue, the gross-margin trajectory, and the burn against the cash on hand.
What moves the needle: Operating margin has reached 19% at its best but run negative through the cycle (median −22%) on a 61% gross margin — so the question is which reading is truer: whether the median was pulled below zero by one-off charges, by the cycle, or by spending it is still growing into, and whether it settles back at a profit. Stock-based pay runs about 27% of sales, a real and recurring claim on owners that the GAAP margin understates. Read this kind of business on process leadership and the capex cycle. On its own account, the filing leans hardest on customer concentration, set against the numbers in what the filing emphasizes, below.
Is it a good business?: Return on capital has rarely cleared the cost of capital (median −15%, above 15% in 1 of 10 years). The steadier read is owner earnings: roughly 11% of revenue reaches owners as cash, consistently. This is price-taker territory, where the balance sheet and the cycle matter more than any multiple; the rest is in the 10-K.

Every line is arithmetic on the company's filings, shown in full in the sections below.

Where the money comes from

read the 10-K →

94% of revenue comes from outside the United States.

Revenue by geography, FY2026

Taiwan70%$272M
Asia Pacific other than Taiwan18%$71M
North America other than United States6%$22M
Europe5%$20M
United States1%$6M

From the segment footnote of the company's own 10-K. Shares are of total revenue; the profit bar shows each segment's share of segment operating profit, before unallocated corporate costs.

The record

Ten years of arithmetic, read across the cycle.

The record, 2017–2026

realized figures from each filing · older years to the left

2017’17	2018’18	2019’19	2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	2026’26	TTMTTMApr 2026
											Income statement
$310M	$295M	$228M	$229M	$223M	$332M	$338M	$226M	$285M	$391M	$405M	RevenueRevenue
66%	64%	61%	58%	61%	63%	62%	60%	60%	59%	59%	Gross marginGross mgn
14%	16%	22%	23%	25%	21%	23%	34%	26%	19%	19%	SG&A / revenueSG&A/rev
33%	39%	56%	57%	63%	50%	61%	95%	79%	61%	59%	R&D / revenueR&D/rev
$60M	$24M	($40M)	($50M)	($61M)	($30M)	($74M)	($155M)	($127M)	($83M)	($76M)	Operating incomeOp. inc.
19.5%	8.3%	−17.7%	−21.7%	−27.4%	−8.9%	−22.0%	−68.2%	−44.4%	−21.1%	−18.8%	Operating marginOp. mgn
$58M	$19M	($30M)	($45M)	($60M)	($26M)	($65M)	($169M)	($117M)	($76M)	($70M)	Net incomeNet inc.
											Cash flow & returns
$113M	$85M	$24M	$39M	$31M	$39M	$44M	$19M	$34M	$74M	$33M	Operating cash flowOp. cash
$2M	$5M	$7M	$12M	$12M	$14M	$20M	$25M	$26M	$26M	$25M	DepreciationDeprec.
$5M	$5M	($13M)	$6M	$8M	($37M)	($22M)	$52M	$17M	$26M	($16M)	Working capital & otherWC & other
$3M	$4M	$3M	$2M	$2M	$10M	$15M	$12M	$10M	$16M	$15M	CapexCapex
0.9%	1.2%	1.3%	0.8%	0.9%	2.9%	4.5%	5.3%	3.6%	4.0%	3.7%	Capex / revenueCapex/rev
$111M	$82M	$22M	$38M	$29M	$29M	$29M	$7M	$23M	$58M	$18M	Owner earningsOwner earn.
35.6%	27.7%	9.5%	16.4%	12.9%	8.8%	8.6%	3.1%	8.2%	14.8%	4.5%	Owner earnings marginOE mgn
$111M	$82M	$22M	$38M	$29M	$29M	$29M	$7M	$23M	$58M	$18M	Free cash flowFCF
35.6%	27.7%	9.5%	16.4%	12.9%	8.8%	8.6%	3.1%	8.2%	14.8%	4.5%	Free cash flow marginFCF mgn
$0	$0	—	$0	$0	$307M	$0	$0	—	—	$0	AcquisitionsAcquis.
$20M	$55M	$100M	$0	$1M	$0	$0	$0	$0	$1M	—	BuybacksBuybacks
44%	13%	-14%	-18%	-21%	-6%	-12%	-29%	-24%	-16%	-12%	ROICROIC
13%	4%	-7%	-10%	-13%	-5%	-11%	-30%	-21%	-13%	-11%	Return on equityROE
13%	4%	−7%	−10%	−13%	−5%	−11%	−30%	−21%	−13%	−11%	Retained to equityRetained/eq
											Balance sheet
$323M	$347M	$194M	$231M	$241M	$171M	$114M	$145M	$145M	$191M	$153M	Cash & investmentsCash+inv
$39M	$31M	$26M	$18M	$25M	$44M	$52M	$25M	$30M	$39M	$39M	ReceivablesReceiv.
$20M	$23M	$18M	$23M	$26M	$45M	$40M	$29M	$34M	$52M	$80M	InventoryInvent.
$20M	$20M	$13M	$15M	$21M	$31M	$18M	$29M	$22M	$54M	$53M	Accounts payablePayables
$39M	$35M	$32M	$27M	$30M	$58M	$75M	$25M	$42M	$37M	$66M	Operating working capitalOper. WC
$469M	$493M	$410M	$451M	$497M	$267M	$305M	$280M	$321M	$410M	$405M	Current assetsCur. assets
$54M	$53M	$39M	$53M	$74M	$89M	$83M	$83M	$121M	$178M	$167M	Current liabilitiesCur. liab.
8.6×	9.3×	10.5×	8.4×	6.7×	3.0×	3.6×	3.4×	2.6×	2.3×	2.4×	Current ratioCurr. ratio
$27M	$27M	$27M	$27M	$27M	$304M	$304M	$304M	$304M	$304M	$304M	GoodwillGoodwill
$512M	$547M	$467M	$527M	$573M	$658M	$710M	$658M	$689M	$799M	$795M	Total assetsAssets
($323M)	($347M)	($194M)	($231M)	($241M)	($171M)	($114M)	($145M)	($145M)	($191M)	($153M)	Net debt / (cash)Net debt
$455M	$482M	$419M	$448M	$475M	$547M	$606M	$560M	$561M	$595M	$606M	Shareholders’ equityEquity
15.7%	19.2%	26.7%	29.2%	31.5%	26.5%	32.9%	49.2%	37.8%	25.1%	23.2%	Stock comp / revenueSBC/rev
											Per share
34.3M	34.6M	32.7M	33.1M	34.7M	36.6M	38.4M	39.9M	41.3M	42.7M	43.6M	Shares out (diluted)Shares
$9.04	$8.54	$6.96	$6.91	$6.43	$9.07	$8.80	$5.68	$6.90	$9.15	$9.29	Revenue / shareRev/sh
$1.68	$0.55	$-0.93	$-1.35	$-1.72	$-0.72	$-1.70	$-4.25	$-2.84	$-1.78	$-1.60	EPS (diluted)EPS
$3.22	$2.36	$0.66	$1.14	$0.83	$0.80	$0.76	$0.18	$0.57	$1.36	$0.42	Owner earnings / shareOE/sh
$3.22	$2.36	$0.66	$1.14	$0.83	$0.80	$0.76	$0.18	$0.57	$1.36	$0.42	Free cash flow / shareFCF/sh
$0.08	$0.11	$0.09	$0.06	$0.06	$0.26	$0.39	$0.30	$0.25	$0.36	$0.34	Cap. spending / shareCapex/sh
$13.24	$13.94	$12.82	$13.54	$13.70	$14.96	$15.80	$14.04	$13.59	$13.93	$13.89	Book value / shareBVPS

Per-share growththe realized rate an owner's share compounded

	9-yr	5-yr
Revenue / share	+0.1%/yr	+7.3%/yr
Owner earnings / share	−9.2%/yr	+10.3%/yr
Capital spending / share	+18.5%/yr	+45.2%/yr
Book value / share	+0.6%/yr	+0.3%/yr

The record, charted

FY2017–2026

Each measure over its full record; the current point and the worst year marked.

Share count

43Mpeak FY2026

ROIC

−16%low FY2024

Gross margin

59%low FY2020

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

$58Mowner earningsvs.($76M)net incomelow FY2024

Where the cash went

ReinvestBuybacksDividendsAcquisitionsRetainedBeyond op. cash

Each year's outlays against its operating cash: the mix, and how it drifts. The hatched cap is spending beyond that year's operating cash — financed from the balance sheet or borrowing, not operations.

FY2017FY2026

Owner-earnings bridge

FY2022–FY2026cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2026 the business turned a $76M loss into $58M of owner earnings: more cash than the profit line showed, after the non-cash charges and the capital it put back in.

	FY2026	FY2025	FY2024	FY2023	FY2022
Reported net income	($76M)	($117M)	($169M)	($65M)	($26M)
Depreciation & amortizationnon-cash charge added back	+$26M	+$26M	+$25M	+$20M	+$14M
Stock-based compensationreal costnon-cash, but a real cost	+$98M	+$108M	+$111M	+$111M	+$88M
Working capital & othertiming of cash in and out, other non-cash items	+$26M	+$17M	+$52M	−$22M	−$37M
Cash from operations	$74M	$34M	$19M	$44M	$39M
Capital expenditurecash put back in to keep running and to grow	−$16M	−$10M	−$12M	−$15M	−$10M
Owner earnings	$58M	$23M	$7M	$29M	$29M
Owner-earnings marginowner earnings ÷ revenue	15%	8%	3%	9%	9%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the capital it must spend to hold its position . The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $98M), owner earnings is nearer ($40M).

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2026 10-K · source on SEC EDGAR →

Will it survive?

Can it pay its interest? —

No meaningful interest burden

Little or no interest expense reported

What this means
Little or no interest expense reported, the business isn't leaning on lenders to operate.
How heavy is the debt, net of cash? +$191M

Net cash, debt-free

Cash $191M − debt $0

What this means
Cash and short-term investments exceed every dollar of debt by $191M, on net the company owes nothing, and can act from strength when others can't. Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? 33d

Tight

DSO 37 + DIO 120 − DPO 124 days

What this means
Days cash is tied up between paying suppliers and collecting from customers. Lower is better; a long cycle means growth itself eats cash.

Is it a good business?

Return on invested capital —

Not enough data

Industry peers: median 8%

What this means
The filing data didn't include the inputs for this check.
Owner-earnings margin 9%

Solid through the cycle

10-yr median margin, range 3%–36%; latest $58M = operating cash $74M − maintenance capex $16M

Industry peers: median 15%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 15% of revenue this year, a 9% median across 10 years. Treating stock comp as the real expense it is (less $98M of SBC) leaves ($40M).
Are earnings backed by cash? $74M

Loss, but cash-generative

Net income ($76M) · cash from operations $74M

What this means
The company reported a net loss, so a conversion ratio isn't meaningful. What matters then is whether operations still threw off cash, here, they did.

How is the cash used?

Where do the earnings go? 2%

Reinvests most of it

Dividends + buybacks $1M ÷ Owner Earnings $58M

What this means
Of $58M Owner Earnings, $1M (2%) went back to shareholders, $0 dividends, $1M buybacks. But the buybacks barely exceed stock issued to employees ($98M SBC), net of dilution, little was truly returned. Returning most of it is the mark of a mature business with little left to reinvest at a high return; reinvesting most could mean a long runway, or empire-building. The split doesn't say which; the return earned on it (see ROIC) does.
Investing or harvesting? 0.61×

Harvesting

Capex $16M ÷ depreciation $26M

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 1 of 5 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Miss

Revenue ≥ $2B · $391M

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Pass

Current ratio ≥ 2× · 2.31×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Earnings stability Miss

A profit every year (10-yr record) · 8 loss years

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Miss

Uninterrupted dividends · none paid

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Earnings growth Miss

Earnings +33% over the record · −884%

What this means
At least a third more earnings than a decade ago, averaging three years at each end. Net income (not per-share), so stock splits don't distort it, buybacks and dilution show up in the share-count line instead.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $-2.75/share (latest year $-1.73), the averaged base the calculator's gate runs on, and book value is $13.56/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2017–2026

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 2 of 10

What this means
Lost money in 8 year(s), look at what happened there before trusting the average.
Operating margin 3% → −45% (3-yr avg ends)

In the filing’s words The filing claims pricing power in its strongest form — price raised, volume held — yet the margin here has not widened to match. The claim leads the record; weigh them together.

What this means
Through the cycle the operating margin slipped — about 3% early to −45% lately, median −22% — competition or costs are biting in.
Owner earnings growth −9%/yr

What this means
Owner earnings shrank about 9% a year over the record.
Worst year 2024 · −68.2% op. margin

What this means
Operations went underwater in 2024, understand why before trusting the good years.
Share count +2.5%/yr

What this means
The share count is rising, dilution works against you on a per-share basis.
How management talks about it Promotional

What this means
The returns have faded, yet the filing reaches for a promoter’s vocabulary — world-class, best-in-class, disruptive — more than an owner’s. When the words sell harder than the results deliver, the gap is the thing to weigh.

Does AI threaten the moat?

Low contestability

The moat is physical, regulated or balance-sheet-funded, the kind AI cuts costs within but does not contest.

In its own filing Framed as a capability

The filing positions AI as something the company uses, not something it fears.

“B USINESS Overview Incorporated in 2004, Ambarella is a leading developer of low-power system-on-a-chip, or SoC, semiconductors and software for edge and physical artificial intelligence (AI) applications and intelligent automation.”

AI is unlikely to contest a moat that is physical, regulated or balance-sheet-funded; here it reads more as a cost tool than a threat, and the company is using it that way.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of the latest quarter, Apr 30, 2026

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$405M

Cash & short-term investments$153M
Receivables$39M
Inventory$80M
Other current assets$133M

Current liabilities$167M

Accounts payable$53M
Other current liabilities$114M

Current ratio2.43×all current assets ÷ what's due · Graham looked for 2×

Quick ratio1.95×stricter: inventory excluded

Cash ratio0.91×strictest: cash alone against what's due

Working capital$238Mthe cushion left after near-term bills

Revenue, latest quarter vs. a year ago+16.9%the freshest read on whether the business is still growing

Current ratio, recent quarters3.1× → 2.4×

Deeper floors

Tangible book value$243Mequity stripped of goodwill & intangibles

Net current asset value$216MGraham's net-net: current assets less all liabilities

Debt incl. operating leases$13M$13M of it operating leases

Deferred revenue$20Mcustomer cash collected before delivery; operating float

From the company's latest filing.

How the cash was used, 2017–2026

Over the record, the business generated $503M of operating cash; how management split it reads as a balanced allocator, splitting cash between the business, owners, and the balance sheet.

Reinvested$76M · 15%
Buybacks$177M · 35%
Retained (debt / cash)$250M · 50%

Returned to owners$177M
41% of the owner earnings the business produced over the span, $0 as dividends and $177M as buybacks.
Source of fundingOperating cash
Operating cash covered reinvestment and returns; over the span cash and short-term investments fell $170M.
Average price paid for buybacks$43.87
Across the years where the filing reports a share count, 4M shares were bought for $175M, about $43.87 each.
Net change in share count27.0%
The diluted count rose from 34M to 44M: issuance (stock pay, deals) outran any buybacks, so owners were diluted on net.
Dividend record—
No dividend line was reported in the filing data over the span; the record here neither confirms nor rules out a payout.

Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.

Acquisitions & goodwill

from the balance sheet & the 10-year cash-flow record

Goodwill grows only when a company acquires and falls only when it concedes it overpaid. The size of that bet, the cash put into buying rather than building, and how much has already been written off.

Goodwill & intangibles$362M45% of all assets; the premium carried on the balance sheet for businesses acquired

Against book equity51%goodwill is this share of book equity; the rest is the company’s own retained and paid-in capital

Cash spent acquiring$307Mover 10 years buying other businesses, against $76M of capital spent building

None written down over the record; the goodwill is still carried at full cost. That is the deals holding their value on the books so far; whether they keep doing so is the test an owner watches, since the write-down, when it comes, is the admission the price was too high.

Goodwill, acquired intangibles and equity from the latest balance sheet; acquisition spend and write-downs summed across the 10-year record, from the company's own filings.

Management, ownership & pay

read the proxy →

From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.

Fiscal year	Chief executive	Pay, as filed	“Actually paid”	Owner earnings
2022	Dr. Feng-Ming (Fermi) Wang	$6.2M	$21.2M	$29M
2023	Dr. Feng-Ming (Fermi) Wang	$5.9M	−$5.2M	$29M
2024	Dr. Feng-Ming (Fermi) Wang	$5.8M	−$779k	$7M
2025	Dr. Feng-Ming (Fermi) Wang	$7.5M	$12.1M	$23M
2026	Dr. Feng-Ming (Fermi) Wang	$7.4M	$3.6M	$58M

Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years.

Insider ownership4.5%
The stake all directors and executive officers hold together, per the 2026 proxy: skin in the game, the first thing Munger reads.
CEO pay ratio67:1
What the chief earns for every dollar the median employee makes, per the 2026 proxy. A high ratio alone settles nothing; some businesses are genuinely top-heavy in scarce skill. A runaway figure is where Buffett starts asking whether the board is doing its job.
Stock-based compensation$98M
The slice of the business handed to employees in shares this year, 25% of revenue. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.

Inverting the record

Invert: instead of why Ambarella is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2017–2026.

All 3 tests turned up something to look into. A record that trips every wire is one to understand slowly.

Look hereIs it less profitable than it was?8.7% vs 24.3%
The owner-earnings margin averaged 24.3% early in the record and 8.7% across the last three years, and the latest year has not recovered. Ask the filing whether that is a structural drift or a cyclical trough — price, mix, cost, or a competitor — and whether it is permanent.
Look hereDid the share count rise anyway?27.0%
Diluted shares grew 27.0% over 2017–2026, even as the company spent $177M on buybacks. The repurchases were a treadmill: stock issued to staff outran them, so owners' slice still shrank. Read the buyback line beside this one, not on its own.
Look hereDid receivables and inventory outpace sales?19% → 29% of sales
Receivables and inventory grew from $59M to $120M while revenue grew 31%: working capital is climbing faster than sales (19% of revenue then, 29% now). That can mean customers paying slower, stock building up, or revenue pulled forward. The filing's cash-flow and receivables notes say which.

Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.

What an owner would ask, FY2026

read the 10-K →

Which reported numbers are a judgment call?
Management names Revenue recognition, Income taxes, Inventory, Stock compensation as critical estimates
each rests partly on management's judgment; the filing's note sets out the assumptionsverify →

The questions the record and the charts do not answer on their own; each carries the figure and the place to look.

Peers, Semiconductors

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
KLICKulicke and Soffa Industries Inc.	$654M	47%	9.4%	8%	14%
LSCCLattice Semiconductor	$523M	60%	9.1%	9%	22%
SHLSShoals Technologies Group Inc.	$475M	36%	17.0%	10%	17%
MXLMaxLinear Inc.	$468M	55%	-5.3%	-3%	15%
POWIPower Integrations	$444M	51%	13.4%	11%	17%
SKYTSkyWater Technology Inc.	$442M	16%	-6.2%	-14%	-12%
AMBAAmbarella	$391M	61%	-21.4%	-15%	11%
LASRnLIGHT Inc.	$261M	28%	-9.8%	-16%	-2%
Group median	—	49%	1.9%	3%	14%

The price

What a price has to assume.

What the price implies

reverse-DCF

Type today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Ambarella has delivered.

Ambarella’s latest year runs above its own through-cycle margin — the reported figure may flatter a peak. So the tool opens on the through-cycle base, Graham’s averaging cutting both ways; clear the toggle below to read the latest year exactly as reported.

Today’s price $

Through the cycle, Ambarella earns about $44M on its 11.2% median owner-earnings margin. This year’s 14.8% margin runs above that; the reported figure may flatter a peak you'd be paying on. Normalize, below, values the price on that through-cycle figure rather than the latest year. It comes pre-checked here for that reason, the same rule that already normalizes a trough; clear it to price the year as filed.

Base Normalize · through-cycle ($44M) Net of stock comp (−$94M)

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The assumptions Required return 9% Years of high growth 10 Terminal growth 2.5%

9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.

Enter a price above to run it.

Implied by the price—

Owner-earnings growth · ’22→’26+9%/yr

Owner-earnings growth · ’17→’26−9%/yr

Owner-earnings yield—

P/E (3-yr earnings ’24–’26)—

P/B—

Graham’s price gate—

Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.

Against a high-grade bond: Graham’s yardstick bond yield%

Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.

Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.

Owner earnings $18M on 44M shares outstanding, per the 10-Q cover, as of 2026-05-28; net cash $153M. The base opens on the through-cycle figure (the latest year sits above the record’s own median, and Graham’s averaging cuts both ways); clear Normalize to use the year as filed. Net of stock comp treats option pay as the expense it is. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.

Weigh AMBA against another business →

Cite: Owner Scorecard, "Ambarella (AMBA), the owner's record," https://ownerscorecard.com/c/AMBA, data as of 2026-07-09.

Manual order: ← AMAT its page in the Manual AMBQ →

Industry order: ← AMAT the Semiconductors chapter AMBQ →