In the fast-evolving technology sector, two companies stand out: Ambarella, Inc. (AMBA) and Ouster, Inc. (OUST). Both firms operate within the semiconductor and hardware industries, focusing on innovative solutions that enhance visual technology and automation. While Ambarella specializes in advanced processing for high-definition video, Ouster is revolutionizing 3D vision through its cutting-edge lidar sensors. In this article, I will guide you through their unique strengths and challenges to help you determine which company presents a more compelling investment opportunity.
Table of contents
Company Overview
Ambarella, Inc. Overview
Ambarella, Inc. is a semiconductor company specializing in video processing technology. Founded in 2004 and headquartered in Santa Clara, California, Ambarella develops system-on-a-chip designs that integrate high-definition video processing, image processing, and artificial intelligence capabilities. Its products serve various sectors, including automotive cameras, security cameras, and consumer electronics. Ambarella’s commitment to innovation is reflected in its focus on low-power consumption and high-quality video output, positioning it as a leader in the burgeoning AI and IoT markets. The company trades on NASDAQ under the ticker AMBA, with a current market cap of approximately $3.24B.
Ouster, Inc. Overview
Ouster, Inc., founded in 2020 and based in San Francisco, is a leading provider of high-resolution lidar sensors and software solutions. These products enable 3D vision for autonomous vehicles, robotics, and various industrial applications. Ouster’s technology is designed to deliver improved accuracy and efficiency, which is crucial in the rapidly evolving landscape of autonomous systems. The company is publicly listed on NASDAQ under the ticker OUST, with a current market cap of around $1.32B. Ouster’s focus on scalability and adaptability positions it well to capture significant market share in the lidar technology space.
Key similarities between Ambarella and Ouster include their focus on advanced technology and integration of AI into their products. However, they differ significantly in their core offerings: Ambarella specializes in video processing semiconductors, while Ouster focuses on lidar sensors. This distinction highlights the unique niches each company occupies within the broader technology sector.
Income Statement Comparison
In this section, I will present a comparative analysis of the most recent income statements for Ambarella, Inc. (AMBA) and Ouster, Inc. (OUST) to help investors evaluate their financial performance.
| Metric | Ambarella, Inc. (AMBA) | Ouster, Inc. (OUST) |
|---|---|---|
| Revenue | 285M | 111M |
| EBITDA | -101M | -80M |
| EBIT | -127M | -95M |
| Net Income | -117M | -97M |
| EPS | -2.84 | -2.08 |
Interpretation of Income Statement
Both companies are experiencing significant losses, with Ambarella showing a revenue increase from 226M in 2024 to 285M in 2025, indicating a positive trend. However, Ouster’s revenue also grew, albeit at a slower rate, from 83M to 111M. Despite the revenue growth, both firms are grappling with negative EBITDA and EBIT margins, indicating ongoing operational challenges. The net income losses suggest that cost management remains a vital area for improvement. Ultimately, while Ambarella’s revenue growth is encouraging, both companies need to address their profitability issues to attract investor confidence.
Financial Ratios Comparison
Below is a comparative table showing the most recent revenue and financial ratios for Ambarella, Inc. (AMBA) and Ouster, Inc. (OUST).
| Metric | AMBA | OUST |
|---|---|---|
| ROE | -20.86% | -536.42% |
| ROIC | -21.96% | -51.12% |
| P/E | -27.05 | -5.87 |
| P/B | 5.64 | 3.15 |
| Current Ratio | 2.65 | 2.80 |
| Quick Ratio | 2.36 | 2.59 |
| D/E | 0.0094 | 0.1119 |
| Debt-to-Assets | 0.0076 | 0.0733 |
| Interest Coverage | 0 | -57.15 |
| Asset Turnover | 0.41 | 0.40 |
| Fixed Asset Turnover | 19.96 | 4.54 |
| Payout Ratio | 0 | 0 |
| Dividend Yield | 0 | 0 |
Interpretation of Financial Ratios
The financial ratios for both companies indicate significant challenges. Ambarella shows a very high P/B ratio, reflecting potential overvaluation despite its higher asset turnover. Ouster’s negative ROE and interest coverage ratio suggest severe financial stress. Both companies lack dividends, indicating a focus on reinvention over returns. Investors should tread cautiously due to these concerning metrics and potential risks in their investments.
Dividend and Shareholder Returns
Neither Ambarella, Inc. (AMBA) nor Ouster, Inc. (OUST) pays dividends, as both companies are in a growth phase, prioritizing reinvestment and research and development. AMBA has not demonstrated positive net income, and OUST’s losses are substantial, indicating a need for capital preservation. Both companies engage in share buybacks, which reflects a commitment to enhance shareholder value. However, the lack of dividends and ongoing losses raises concerns about sustainable long-term value creation.
Strategic Positioning
Ambarella, Inc. (AMBA) holds a significant market share in the semiconductor sector, particularly in high-definition video processing solutions, with a market cap of approximately 3.24B. It faces competitive pressure from peers like Ouster, Inc. (OUST), which specializes in lidar technology for 3D vision, boasting a market cap of around 1.32B. Both companies are navigating technological disruptions in their respective fields, necessitating continuous innovation to maintain their market positions and adapt to evolving customer demands.
Stock Comparison
In this section, I will analyze the weekly stock price movements and trading dynamics of Ambarella, Inc. (AMBA) and Ouster, Inc. (OUST) over the past year, highlighting key price changes and trends.
Trend Analysis
Ambarella, Inc. (AMBA) Over the past year, AMBA’s stock has experienced a significant price change of +38.24%, indicating a bullish trend. The highest price reached during this period was 89.67, while the lowest was 40.99. The trend is characterized by acceleration, suggesting continued upward momentum. Recent data shows a decline of -5.28% from September 14, 2025, to November 30, 2025, with a standard deviation of 4.54, indicating some volatility in the short term.
Ouster, Inc. (OUST) OUST’s stock has shown an impressive overall price change of +215.31%, also reflecting a bullish trend. The stock peaked at 35.8 and dipped to 4.82. However, the acceleration status has shifted to deceleration, suggesting a potential slowdown in the upward momentum. In the recent analysis period from September 14, 2025, to November 30, 2025, the stock has decreased by -23.87%, with a standard deviation of 4.85, pointing to notable volatility in this timeframe.
In summary, both stocks demonstrate positive long-term trends, but recent performance indicates short-term challenges, particularly for OUST. Investors should closely monitor these developments and consider their risk tolerance when making investment decisions.
Analyst Opinions
Recent analyst recommendations for Ambarella, Inc. (AMBA) suggest a cautious approach, with a rating of C+ indicating a hold stance. Analysts point to solid debt management but weak profitability metrics. In contrast, Ouster, Inc. (OUST) has received a lower C- rating, with analysts highlighting significant concerns regarding its cash flow and overall performance. The consensus for AMBA leans towards a hold, while OUST is viewed as a sell for the current year. I recommend weighing these insights carefully before making investment decisions.
Stock Grades
As we evaluate the latest stock ratings, there are notable insights from recognized grading companies regarding Ambarella, Inc. and Ouster, Inc.
Ambarella, Inc. Grades
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Rosenblatt | maintain | Buy | 2025-11-26 |
| Stifel | maintain | Buy | 2025-11-26 |
| Needham | maintain | Buy | 2025-11-26 |
| Rosenblatt | maintain | Buy | 2025-11-24 |
| Oppenheimer | maintain | Perform | 2025-08-29 |
| Needham | maintain | Buy | 2025-08-29 |
| Stifel | maintain | Buy | 2025-08-29 |
| Morgan Stanley | maintain | Overweight | 2025-08-29 |
| Northland Capital Markets | maintain | Outperform | 2025-08-29 |
| B of A Securities | maintain | Neutral | 2025-08-29 |
Ouster, Inc. Grades
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Cantor Fitzgerald | upgrade | Overweight | 2025-11-07 |
| Cantor Fitzgerald | upgrade | Overweight | 2025-11-06 |
| WestPark Capital | maintain | Buy | 2025-11-05 |
| Rosenblatt | maintain | Buy | 2025-11-05 |
| WestPark Capital | upgrade | Buy | 2025-08-13 |
| Oppenheimer | maintain | Outperform | 2025-07-16 |
| WestPark Capital | downgrade | Hold | 2025-06-12 |
| WestPark Capital | upgrade | Buy | 2025-05-09 |
| Cantor Fitzgerald | maintain | Overweight | 2025-03-21 |
| WestPark Capital | maintain | Hold | 2025-03-21 |
In summary, both Ambarella and Ouster have maintained strong grades from various grading agencies, with Ouster seeing upgrades that reflect a positive trend in investor sentiment. Ambarella continues to hold a consistent “Buy” rating, while Ouster’s grades suggest a growing confidence in its performance potential.
Target Prices
The consensus target prices for Ambarella, Inc. (AMBA) and Ouster, Inc. (OUST) indicate positive expectations from analysts.
| Company | Target High | Target Low | Consensus |
|---|---|---|---|
| Ambarella, Inc. | 115 | 80 | 97.5 |
| Ouster, Inc. | 39 | 33 | 36.67 |
Analysts expect Ambarella to reach a consensus target of 97.5, significantly higher than its current price of 75.86. Ouster’s consensus target of 36.67 also suggests potential upside from its current price of 22.015.
Strengths and Weaknesses
In the following table, I summarize the strengths and weaknesses of Ambarella, Inc. (AMBA) and Ouster, Inc. (OUST) based on recent financial metrics and performance indicators.
| Criterion | Ambarella, Inc. (AMBA) | Ouster, Inc. (OUST) |
|---|---|---|
| Diversification | Limited product range | Broad application across industries |
| Profitability | Negative margins | Negative margins |
| Innovation | High R&D investment | Emerging technology |
| Global presence | Established in key markets | Expanding presence |
| Market Share | Niche market leader | Competitive landscape |
| Debt level | Low debt-to-equity ratio | Moderate debt levels |
Key takeaways indicate that while Ambarella shows strength in innovation and a low debt level, it faces challenges with profitability. Ouster is expanding but also contends with negative margins, highlighting the risks involved in investing in these companies. Always consider these factors when evaluating your investment decisions.
Risk Analysis
The following table summarizes the key risks associated with each company based on the most recent fiscal year.
| Metric | Ambarella, Inc. (AMBA) | Ouster, Inc. (OUST) |
|---|---|---|
| Market Risk | High | High |
| Regulatory Risk | Moderate | Moderate |
| Operational Risk | High | High |
| Environmental Risk | Low | Moderate |
| Geopolitical Risk | Moderate | High |
Both Ambarella and Ouster face significant operational risks due to heavy reliance on technology and market fluctuations. Ambarella’s recent net profit margin was -41.1%, while Ouster’s was -87.3%, highlighting their vulnerability in a competitive market.
Which one to choose?
In comparing Ambarella, Inc. (AMBA) and Ouster, Inc. (OUST), I find that AMBA shows a more favorable overall financial health despite its negative profitability margins. With a market cap of 3.17B and a gross profit margin of 60.5%, it suggests strong revenue generation capabilities. However, AMBA’s negative net profit margin (-41.1%) raises concerns about its cost structure. In contrast, OUST, with a market cap of 569M and a gross margin of 36.4%, also struggles with negative profitability (-87.3% net margin), indicating deeper operational challenges.
Analyst ratings support AMBA at C+ compared to OUST’s C-. For growth-focused investors, AMBA may be more appealing, while those seeking stability might consider the lower market cap of OUST, albeit with higher risk. Both companies face risks related to competition and operational efficiency.
Disclaimer: This article is not financial advice. Each investor is responsible for their own investment decisions.
Go further
I encourage you to read the complete analyses of Ambarella, Inc. and Ouster, Inc. to enhance your investment decisions:
