ALGM experienced a severe financial deterioration with revenue declining 31% to $725M and swinging from $152.7M profit to a $73M loss.
The company's fundamentals have deteriorated dramatically across all key metrics, suggesting either significant market headwinds or execution challenges. The shift from profitable operations to substantial losses, combined with rising debt levels and declining cash position, indicates potential liquidity concerns and raises questions about the sustainability of current operations.
ALGM's financial performance collapsed with revenue falling 31% and the company swinging from $152.7M net income to a $73M loss, driven by a 44% decline in gross profit and negative operating income of $19.8M. The balance sheet weakened significantly with cash declining 43% to $121.3M while debt increased 38% to $338.9M, and the company dramatically reduced capital expenditures by 68% to preserve cash. This comprehensive financial deterioration across profitability, cash generation, and balance sheet strength signals serious operational challenges requiring immediate attention.
Interest expense surged 182.1% — significant debt increase or rising rates materially impacting earnings.
Net income declined 147.8% — review whether driven by operations, interest costs, or non-recurring items.
Operating income deteriorated sharply — investigate whether driven by one-time charges or structural cost issues.
Capex reduced 68% — investment cycle winding down or capital discipline; may improve near-term free cash flow.
Operating cash flow fell 65.9% — earnings quality concerns; investigate working capital changes and non-cash items.
Gross margin compression — rising input costs, pricing pressure, or unfavorable product mix shift.
Cash declined 42.8% — significant cash burn or deployment; verify adequacy of remaining liquidity runway.
Debt increased 38.3% — substantial leverage increase; assess whether deployed for growth or covering losses.
Revenue declined 30.9% — significant demand weakness or market share loss warrants investigation.
Receivables declined — improved collection efficiency or conservative revenue recognition.
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