What happened
Shares of Silicom (NASDAQ: SILC) were climbing higher today after the company reported third-quarter financial results that beat Wall Street's top- and bottom-line estimates.
Tech investors have been eager for good news as the sector had suffered over the past year -- and they found it in Silicom's latest results. As a result, the tech stock was up by 10.5% as of 11:23 a.m. ET.
So what
Silicom's third-quarter sales increased by 19% from the year-ago quarter to $39.2 million, which beat analysts' consensus estimate of $38.8 million.
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The company's bottom line didn't disappoint either. Silicom's non-GAAP (adjusted) earnings per share of $1.01 in the quarter far outpaced Wall Street's average estimate of $0.70.
Silicom's CEO Liron Eizenman said in a press release, "We have never experienced demand at this level, or from such a broad variety of market players, resulting in a significant increase in our total addressable market."
Silicom shareholders were also happy with the company's fourth-quarter guidance. Management said that it expects revenue to be in the range between $43 million to $45 million, which represents a 21% year-over-year increase at the midpoint.
Now what
While Silicom's latest financial results boosted its share price today, the company's management did warn that the company is still dealing with a component shortage.
"While multiple design wins continue to drive high demand for our products, our ability to deliver continues to be impacted to some extent by the global components crisis, which, despite signs of some lessening, is still expected to continue into 2023," management said.
All of this means that Silicom investors should be pleased with the latest financial results but also keep a close eye on any changes to Silicom's business as it manages potential component shortages.
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Chris Neiger has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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