SiTime Downgraded: Lack Of Visibility Of Oscillators Consumption And Customer Demand Prompt Analyst

Needham analyst N.Quinn Bolton downgraded SiTime Corp SITM to Hold from Buy.
The analyst is bearish on management's guidance cut for the fourth consecutive quarter and lower visibility of the run-rate of oscillators consumption.
Also, Bolton sees SITM's largest customer's consumption as less certain and expects this customer's demand recovery to be slower than previously expected.
The company reported Q1 sales of $38.3 million, beating the consensus of $38.0 million, and adjusted EPS of $0.09 vs consensus of $0.00.
Management expects Q2 2023 sales of $25 million-$28 million (vs. consensus of $41.8 million), gross margin of 56%-58% (-480 bps Q/Q), and adjusted EPS of $(0.25)-$(0.35) versus the consensus of $0.09.
The analyst reduced the 2023 revenues estimate to $139.8 million from $200 million and the 2024 estimate to $190 million from $275 million. Also, he cut the adjusted EPS estimate to $(0.20) from $1.30 for 2023 and $0.90 from $2.65 for 2024.
Price Action: SiTime shares are trading lower by 19.8% at $85.40 on the last check Thursday.

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