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    Allegro MicroSystems Stock Gets A Lift From Earnings And AI Data Center Push

    Simply Wall St·11/06/2026 08:30:42
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    • Allegro MicroSystems reported second quarter 2026 sales of US$276.88 million and net income of US$23.26 million, with the business also turning a six month period from a loss a year earlier to a profit.
    • Beyond the headline figures, Allegro MicroSystems is pushing deeper into AI data centers and high performance computing with new current sensors, gate drivers and motor drivers that target a projected US$1.7b addressable market by fiscal 2031.
    • The next area of focus will be how Allegro MicroSystems' earnings strength and AI data center product push influence its broader investment narrative.
    Spot opportunities across AI infrastructure by comparing Allegro MicroSystems' latest move with a curated set of 53 AI infrastructure stocks that are also tied to data center and high performance computing demand.

    Allegro MicroSystems Investment Narrative Recap

    To own Allegro MicroSystems, you need to buy into a simple idea. The business is trying to turn its sensor and power IC portfolio into a bigger role in electric vehicles, industrial automation and AI data centers, while steadily improving profitability. The latest quarter, with US$276.88 million in sales and US$23.26 million in net income, supports that direction.

    In the short term, the key catalyst is execution on higher margin mix and cost work as Allegro chases its mid 50s gross margin ambition. The latest profit rebound helps, although management still faces pricing pressure, input cost inflation and the risk that current strong bookings eventually flip into another period of customer inventory digestion.

    The most relevant recent announcement here is Allegro MicroSystems' new AI data center and high performance computing product set, including higher isolation current sensors, the AHV85311 Power Thru gate driver and the upgraded QuietMotion A89333 motor driver. These offerings are built for 800V power systems and 48V cooling, which is where a lot of AI infrastructure spending is concentrated today.

    For investors, this product news links directly to the data center catalyst that analysts already focus on. A broader catalog in current sensors and gate drivers can support the mix shift toward Industrial and Other revenue, where data center already accounts for 17% of sales, while also increasing exposure to China, pricing cycles and any future correction if today’s bookings strength turns into over ordering.

    Allegro MicroSystems' current analyst narrative points to US$1.6b in revenue and US$399.8 million in earnings by 2029. That path assumes revenue grows at 16.6% per year and earnings rise by about US$368.9 million from US$30.9 million today.

    Uncover why Allegro MicroSystems' fair value indicates an 82% potential upside to its current price, which could narrow quickly.

    NasdaqGS:ALGM 1-Year Stock Price Chart
    NasdaqGS:ALGM 1-Year Stock Price Chart

    Exploring Other Perspectives

    You also have analysts at the cautious end arguing Allegro MicroSystems is already priced for perfection on AI data center demand. They were modeling about US$1.5b of revenue and US$296.2 million of earnings by 2029 before this quarter, well below consensus. That more pessimistic view shows how far opinions can diverge and why exploring both narratives after this news matters.

    Explore 4 other Allegro MicroSystems fair value estimates, including one that suggests it could be worth just $37.54!

    The Verdict Is Yours

    Don't just follow the ticker; dig into the data and build a conviction that's truly your own.

    Looking for more Allegro MicroSystems investment ideas?

    If Allegro MicroSystems has sharpened your focus on where capital might work hardest, use the Simply Wall St Screener to line it up against other opportunities that match your risk tolerance and income goals.