Ambarella (AMBA) develops semiconductor processing solutions for video that fully integrate HD video, audio, image processing and system functions onto a single chip. Its chips are used for sports cameras, wearable cameras, automotive aftermarket cameras and Internet Protocol security cameras.
AMBA benefits from the adoption of consumer wearable/sports cameras. Its wearable camera design win with Xiaomi should enable it to increase its market share in Asia in 2015. Increasing shipments of higher margin products due to technology migration from 1,080p to 4K across the end-markets should help to improve its gross margins in FY16. New IoT-enabled categories such as quadcopters, home security and police should lead to sustained revenue growth in the medium term.