Mobileye (MBLY) to Report Q4 Earnings: What’s in the Cards?

Mobileye Global Inc. MBLY is slated to release fourth-quarter 2023 results on Jan 25 before market open. The Zacks Consensus Estimate for the to-be-reported quarter’s earnings per share and revenues is pegged at 27 cents and $636.38 million, respectively.

For the to-be-reported quarter, the consensus estimate for Mobileye’s earnings per share has moved up by 4 cents in the past 30 days. Its bottom line is expected to remain flat compared with the year-ago reported number.

The Zacks Consensus Estimate for MBLY’s quarterly revenues suggests a year-over-year increase of 12.6%. Over the trailing four quarters, the company surpassed earnings estimates on each occasion, the average surprise being 29.47%. This is depicted in the graph below:

Mobileye Global Inc. Price and EPS Surprise

Mobileye Global Inc. price-eps-surprise | Mobileye Global Inc. Quote

Q3 Highlights

Mobileye topped the Zacks Consensus Estimate in its third-quarter 2023 earnings.

Its adjusted earnings per share of 22 cents surpassed the consensus metric of 17 cents and rose from 15 cents per share reported in the year-ago quarter.

Consolidated revenues came in at $530 million, up 17.7% from the corresponding quarter of 2022, but narrowly missed the Zacks Consensus Estimate of $531 million.

Factors at Play

Mobileye is facing the impact of escalating operating expenses, which are affecting margins. In the first nine months of 2023, operating expenses increased approximately 18.4%.

As the company continues to invest in different areas, such as SuperVision and Chauffeur launch and integration teams, the sixth and seventh generations of EyeQ, pre-production samples of image and radar, FMCW lidar components and expansion of facilities worldwide to accommodate headcount growth, operating expenses and capital expenditures will continue to rise.

It also faces intense competition from automotive chipmakers like Qualcomm and NVIDIA. Rising expenses and fierce competition are likely to negatively impact the upcoming results.

Mobileye planned to introduce the second generation of the supervision domain controller in the fourth quarter and consequently anticipated lowering the average selling price (“ASP”). A lower ASP might result in an improvement in gross margin beginning in the second quarter of 2024 but would hurt the near-term margin. The shrinking margin is likely to hurt Mobileye’s fourth-quarter results.

Earnings Whispers

Our proven model does not conclusively predict an earnings beat for Mobileye in the quarter to be reported, as it does not have the right combination of the two key ingredients. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is not the case here, as elaborated below.

Earnings ESP: Mobileye has an Earnings ESP of 0.00%. This is because the Most Accurate Estimate is pegged in line with the Zacks Consensus Estimate. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: MBLY currently has a Zacks Rank #4 (Sell).

Stocks With the Favorable Combination

Here are a few players from the auto space that, according to our model, have the right combination of elements to post an earnings beat this time around.

Lear Corporation LEA will release fourth-quarter 2023 results on Feb 6. The company has an Earnings ESP of +1.36% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Lear’s to-be-reported quarter’s earnings and revenues is pegged at $3.08 per share and $5.64 billion, respectively. LEA surpassed earnings estimates on each occasion, the average surprise being 9.10%.

Ford Motor Company F will release fourth-quarter 2023 results on Feb 6. The company has an Earnings ESP of +4.93% and a Zacks Rank #3.

The Zacks Consensus Estimate for Ford’s to-be-reported quarter’s earnings and revenues is pegged at 12 cents per share and $36.39 billion, respectively. F surpassed earnings estimates on two out of the trailing four quarters and missed twice, the average surprise being 20.30%.

BorgWarner Inc. BWA will release fourth-quarter 2023 results on Feb 8. The company has an Earnings ESP of +2.44% and a Zacks Rank #3.

The Zacks Consensus Estimate for BorgWarner’s to-be-reported quarter’s earnings and revenues is pegged at 91 cents per share and $3.59 billion, respectively. BWA surpassed earnings estimates on three out of the trailing four quarters and missed once, the average surprise being 10.93%.

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