In today’s competitive technology landscape, Ambarella, Inc. (AMBA) and Ouster, Inc. (OUST) stand out as key players in the semiconductor and lidar sensor industries, respectively. While both companies leverage advanced technology to drive innovation, their approaches and market applications differ significantly. Ambarella focuses on high-definition video processing, while Ouster develops cutting-edge 3D vision solutions. In this article, I will analyze these two companies to determine which one presents the most compelling investment opportunity for you.
Table of contents
Company Overview
Ambarella, Inc. Overview
Ambarella, Inc. is a prominent player in the semiconductor industry, specializing in high-definition and ultra-high-definition video processing solutions. Founded in 2004 and based in Santa Clara, California, Ambarella designs system-on-a-chip products that integrate advanced image processing, artificial intelligence, and low power consumption. Their technologies are crucial for a range of applications, from automotive cameras and security systems to consumer electronics like drones and wearable cameras. With a market capitalization of approximately $3.17B, Ambarella continues to innovate and expand its footprint in sectors such as automotive and robotics.
Ouster, Inc. Overview
Ouster, Inc., established in 2020 and headquartered in San Francisco, focuses on designing and manufacturing high-resolution digital lidar sensors that provide 3D vision capabilities for various industries, including autonomous vehicles and robotics. Their product lineup includes advanced scanning sensors and solid-state flash sensors, highlighting their commitment to cutting-edge technology. With a market cap of around $1.38B, Ouster aims to revolutionize the way machines perceive their environments, positioning itself at the forefront of the lidar technology sector.
Key similarities and differences
Both Ambarella and Ouster operate within the technology sector, yet they focus on different aspects of advanced sensor technology. Ambarella specializes in video processing semiconductors, while Ouster is dedicated to lidar solutions. Their business models emphasize innovation and integration into various applications, but the specific industries they serve and their product offerings diverge significantly.
Income Statement Comparison
The following table provides a comparison of the most recent income statements for Ambarella, Inc. and Ouster, Inc., showcasing key financial metrics for each company.
| Metric | Ambarella, Inc. (AMBA) | Ouster, Inc. (OUST) |
|---|---|---|
| Market Cap | 3.17B | 1.38B |
| Revenue | 284.87M | 111.10M |
| EBITDA | -100.54M | -79.95M |
| EBIT | -126.60M | -94.69M |
| Net Income | -117.13M | -97.05M |
| EPS | -2.84 | -2.08 |
| Fiscal Year | 2025 | 2024 |
Interpretation of Income Statement
In the most recent fiscal year, Ambarella reported revenue of 284.87M, a substantial increase compared to 226.47M in the previous year, indicating positive growth. However, the company continues to face significant losses, with a net income of -117.13M. Ouster, while showing improvement in revenue (111.10M vs. 83.28M previously), also reported a negative net income of -97.05M. Both companies are experiencing challenges with margins, but Ambarella’s growth suggests it may be on a path to recovery, albeit slowly. Ouster’s losses and negative EBITDA highlight ongoing operational struggles.
Financial Ratios Comparison
In the table below, I present a comparative overview of the most recent revenue and financial ratios between Ambarella, Inc. (AMBA) and Ouster, Inc. (OUST).
| Metric | AMBA | OUST |
|---|---|---|
| ROE | -20.86% | -53.64% |
| ROIC | -21.96% | -51.12% |
| P/E | -27.05 | -5.87 |
| P/B | 5.64 | 1.58 |
| Current Ratio | 2.65 | 2.80 |
| Quick Ratio | 2.36 | 2.59 |
| D/E | 0.009 | 0.111 |
| Debt-to-Assets | 0.0076 | 0.211 |
| 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 of both companies highlight notable weaknesses. Ambarella shows a high P/B ratio, indicating potential overvaluation, while Ouster exhibits concerning debt levels with a high debt-to-assets ratio and negative interest coverage. Both companies are not currently offering dividends, reflecting a need for reinvestment to stabilize their operations. The substantial negative ROE and ROIC for both firms raise significant concerns regarding profitability and returns on invested capital.
Dividend and Shareholder Returns
Both Ambarella, Inc. (AMBA) and Ouster, Inc. (OUST) do not pay dividends, which reflects their current negative net income and ongoing reinvestment strategies aimed at growth. This approach suggests a prioritization of research and development, potentially aligning with long-term shareholder value creation. However, both companies are engaging in share buyback programs, which can provide some support to share prices. Ultimately, the lack of dividends may pose risks if growth does not materialize, impacting sustainable value creation for shareholders.
Strategic Positioning
Ambarella, Inc. (AMBA) holds a significant position in the semiconductor market, primarily focusing on high-definition video processing solutions. With a market cap of 3.17B and competitive pressure from firms like Ouster, Inc. (OUST), which specializes in high-resolution lidar sensors, Ambarella must continually innovate to maintain its market share. The technological disruption in image processing and AI integration poses both risks and opportunities, requiring strategic adaptability to stay ahead.
Stock Comparison
In this section, I will evaluate the weekly stock price movements of Ambarella, Inc. (AMBA) and Ouster, Inc. (OUST) over the past year, highlighting key price fluctuations and trading dynamics.
Trend Analysis
Ambarella, Inc. (AMBA) Over the past year, AMBA’s stock has experienced a price increase of 34.7%. This significant positive change indicates a bullish trend. However, the recent trend shows a decline of 7.7% from September 14, 2025, to November 30, 2025, suggesting a short-term bearish movement amidst an overarching bullish scenario. Notably, the stock’s highest price was $89.67, while the lowest was $40.99, indicating a considerable range of volatility with a standard deviation of 12.68. The overall trend is in deceleration, which warrants caution for investors.
Ouster, Inc. (OUST) For OUST, the stock has surged by 228.47% over the past year, also showcasing a bullish trend. In the recent analysis period from September 14, 2025, to November 30, 2025, however, the stock saw a decline of 20.69%, reflecting a short-term bearish trend. The stock reached a peak of $35.80 and a low of $4.82, with a standard deviation of 8.43, indicating notable volatility. Like AMBA, OUST’s overall trend is in deceleration, which suggests that investors should approach with caution during this phase of price correction.
Analyst Opinions
Recent analyst evaluations for Ambarella, Inc. (AMBA) and Ouster, Inc. (OUST) indicate a cautious stance. AMBA has received a “C” rating, with analysts noting a strong debt-to-equity ratio but low scores in return on equity and price-to-earnings metrics. In contrast, OUST holds a “C-” rating, reflecting concerns over its financial fundamentals. Analysts recommend a “hold” on both stocks, as neither presents a compelling buy opportunity currently. The consensus for this year leans towards a “hold” rather than a buy or sell.
Stock Grades
I have gathered the latest stock grades from reliable grading companies for two companies: Ambarella, Inc. (AMBA) and Ouster, Inc. (OUST). Here’s how they are currently rated:
Ambarella, Inc. Grades
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Stifel | maintain | Buy | 2025-11-26 |
| Rosenblatt | maintain | Buy | 2025-11-26 |
| Needham | maintain | Buy | 2025-11-26 |
| B of A Securities | maintain | Neutral | 2025-11-26 |
| Morgan Stanley | maintain | Overweight | 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 |
| Rosenblatt | maintain | Buy | 2025-11-05 |
| WestPark Capital | maintain | Buy | 2025-11-05 |
| WestPark Capital | upgrade | Buy | 2025-08-13 |
Overall, both companies exhibit strong support from analysts, with Ambarella maintaining a Buy rating across multiple firms and Ouster showing a positive upgrade trend, particularly from Cantor Fitzgerald. This suggests a generally favorable outlook for both stocks, although investors should still consider their individual risk tolerances before making investment decisions.
Target Prices
Analysts have provided reliable target price data for both Ambarella, Inc. (AMBA) and Ouster, Inc. (OUST), reflecting their expectations for future stock performance.
| Company | Target High | Target Low | Consensus |
|---|---|---|---|
| Ambarella, Inc. | 115 | 80 | 97.5 |
| Ouster, Inc. | 39 | 33 | 36.67 |
For Ambarella, the target consensus of 97.5 suggests a significant upside from the current price of 74.18, indicating strong analyst confidence. Similarly, Ouster’s consensus of 36.67 also points to potential growth compared to its current price of 22.92.
Strengths and Weaknesses
The following table summarizes the strengths and weaknesses of Ambarella, Inc. (AMBA) and Ouster, Inc. (OUST) based on recent financial data.
| Criterion | Ambarella, Inc. | Ouster, Inc. |
|---|---|---|
| Diversification | Moderate | Low |
| Profitability | Negative margins | Negative margins |
| Innovation | High | Moderate |
| Global presence | Strong | Moderate |
| Market Share | Niche | Emerging |
| Debt level | Low | Moderate |
In summary, Ambarella displays a stronger global presence and innovation capacity, while Ouster has a lower diversification level and faces challenges with profitability. Investors may prefer Ambarella for its strengths, but should remain cautious due to both companies’ negative margins.
Risk Analysis
The table below outlines the key risks associated with Ambarella, Inc. (AMBA) and Ouster, Inc. (OUST).
| Metric | Ambarella, Inc. (AMBA) | Ouster, Inc. (OUST) |
|---|---|---|
| Market Risk | High | High |
| Regulatory Risk | Moderate | High |
| Operational Risk | High | High |
| Environmental Risk | Moderate | Moderate |
| Geopolitical Risk | Low | Moderate |
Both companies face substantial market and operational risks, particularly in the highly competitive technology sector. Ambarella’s reliance on semiconductor technology exposes it to market fluctuations, while Ouster’s focus on lidar technology is sensitive to regulatory changes and market acceptance.
Which one to choose?
When comparing Ambarella, Inc. (AMBA) and Ouster, Inc. (OUST), I find that both companies present unique attributes. AMBA has a higher market cap of approximately 3.17B and shows a gross profit margin of 60.5%, although it struggles with negative net profit margins. Meanwhile, OUST, with a market cap of around 569M, has a lower gross profit margin of 36.4% but has recently shown a 228.5% price increase over the past year despite recent price volatility. Analysts rate AMBA as a C, while OUST holds a C- rating, indicating AMBA’s relative strength in fundamentals.
For growth-oriented investors, AMBA appears more attractive due to its established market presence and higher profit margins. Conversely, those seeking potential recovery might consider OUST, despite its current challenges. Both companies face risks related to market 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:
