F

Ambarella, Inc. — Earnings Quality Grade F

AMBA · Technology

Major red flags

Revenue
$391M
2026
Net Income
-$76M
2026
Gross Margin
59.2%
Free Cash Flow
$58M
01

Screening Summary

15
Passed
0
Watch
2
Failed
-3.11
M-Score

Management Signals

No recent CEO, CFO, board, or accounting leadership signals found in SEC 8-K filings.
02

Financial Trends

Revenue & Net Income ($B)

Margins (%)

03

18-Point Screening

01

Revenue Quality

A1DSO Change

DSO 37 days, change -2 days YoY

A2AR vs Revenue Growth

AR growth 31.6% vs revenue growth 37.2%

A3Revenue vs CFFO

Revenue 37.2%, CFFO 117.3%. Cash follows revenue

02

Expense Quality

B1Inventory vs COGS

Inventory 51.8% vs COGS 41.7%. Normal

B2CapEx vs Revenue

CapEx growth 49.4% vs revenue 37.2%. Normal

B3SG&A Ratio

SG&A/Gross Profit = 32.5%. Normal

B4Gross Margin

Gross margin 59.2%, change -1.3pp. Stable

03

Cash Flow Quality

C1CFFO vs Net Income

CFFO < Net Income for 3 consecutive years

C2Free Cash Flow

FCF $0.1B, FCF/NI = -0.76

C3Accruals Ratio

Accruals ratio = -18.7%. Low accruals

C4Cash vs Debt

Cash $0.3B covers debt $0.0B

04

Balance Sheet Health

D1Goodwill + Intangibles

Goodwill+Intangibles $0.4B = 61% of equity. Over 50%

D2Leverage

Debt/EBITDA = -0.2x. Healthy

D3Soft Asset Growth

Other assets -8.0% vs revenue 37.2%. Normal

D4Asset Impairment

No write-off data

05

Acquisition Risk

E1Serial Acquirer FCF

FCF after acquisitions positive

E2Goodwill Surge

Goodwill+Intangibles change 3% YoY. Normal

06

Manipulation Score

F1Beneish M-Score

M-Score = -3.11 (< -2.22). Unlikely manipulator

Portfolio monitoring

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04

Beneish M-Score

Manipulation Probability-3.11
-4.0 Clean-2.22 Grey-1.78 Danger0
0.96
DSRI
AR growing faster than revenue?
1.022
GMI
Gross margin declining?
0.888
AQI
Asset quality deteriorating?
1.372
SGI
Revenue growth rate
1.244
DEPI
Depreciation slowing?
0.754
SGAI
SG&A ratio changing?
-0.1871
TATA
Accruals level
1.269
LVGI
Leverage increasing?
05

Altman Z-Score

2.94
Safe Zone
0 Distress1.102.605.0+ Safe
0.2909
Liquidity
-0.4106
Cumulative profit
-0.1033
Operating efficiency
2.9183
Leverage

Generated from public financial data using forensic accounting frameworks. Not investment advice. Data: Yahoo Finance · 2026-04-25