Allegro MicroSystems: Data Center Sales to More Than Double as Current Sensors Outpace Motor Drivers, Robotics Content Seen Topping $150 Per Humanoid by 2030
Q1 fiscal 2027 earnings call, July 30, 2026
Allegro MicroSystems posted its sixth consecutive quarter of sequential sales growth, with first-quarter fiscal 2027 revenue of $259 million topping the high end of guidance and rising 27% year-over-year. Non-GAAP EPS of $0.23 more than doubled from a year ago. The results underscore a business increasingly levered to three structural growth vectors—artificial intelligence data centers, vehicle electrification, and now robotics—that CEO Mike Doogue has been building content-per-unit narratives around for several quarters. What stood out this quarter was the granularity: current sensors are now growing faster than the company's legacy motor-driver franchise inside data centers, and Allegro put a hard number on robotics content for the first time.
Current Sensors Emerge as a Distinct Growth Engine Inside Data Center
Data center revenue grew 32% sequentially, reaching a record 17% of total company sales, up from 14% in the fiscal fourth quarter and just 10% two quarters ago. Within that business, current sensors—which help improve power efficiency and density in server racks—jumped to 22% of data center sales, up from a much smaller base after growing 66% sequentially. Doogue said current sensor growth is "outpacing our motor driver business, which itself remains strong as fans are adopted more broadly in power supplies," a dynamic he expects to persist given rising rack power levels and Allegro's TMR (tunnel magnetoresistance) technology, which the company believes gives it the fastest magnetic current sensor in the space today. CFO Derek D'Antilio noted the mix shift has pushed data center gross margins into the mid-50s, meaningfully above the corporate average, since current sensors carry higher margins than motor drivers.
Management reiterated that fiscal 2027 data center sales will more than double year-over-year, a target Doogue tied explicitly to industry capex assumptions of roughly 80% year-over-year growth in AI data center spending for calendar 2026. Longer term, the content story keeps expanding: Allegro's theoretical dollar content per rack has already grown from $150 in legacy racks to $425 in AI-forward configurations, with two-thirds of that increase coming from fan drivers and current sensors. Doogue said isolated gate drivers—still 18 to 24 months from material revenue contribution—could add "hundreds of dollars more in content" as data centers move to 800-volt topologies, with a second-generation gate driver product beginning sampling this fall. Investors pushed hard on the sequential deceleration implied in the second-quarter guide; D'Antilio attributed it to simple law-of-large-numbers math rather than any slowing in bookings or design activity, noting the segment was just 2% of revenue six quarters ago and 10% four quarters ago.
Robotics Content Quantified for the First Time
Allegro disclosed that robotics and automation will contribute 3% to 4% of fiscal 2027 sales, the first time management has sized the opportunity, and said addressable content per humanoid robot could exceed $150 by 2030—surpassing its projected automotive content per vehicle. The company secured current sensor wins with large Chinese humanoid robot OEMs this quarter and a design win with a prominent North American humanoid robotics OEM using Allegro's inductive position sensors in robot joints. Doogue framed the opportunity around Allegro's automotive safety pedigree: "Robotic joints pose the same fundamental safety-relevant motor control challenges that we solve every day in advanced steering and braking applications in cars." He added that the company models its addressable opportunity by counting joints and degrees of freedom across humanoids, robotic arms, and autonomous mobile robots in factories, rather than treating humanoids as the sole vector.
Automotive Outgrowing SAAR Despite EV Choppiness Elsewhere
Automotive sales grew 15% year-over-year, ahead of the company's long-term target of outgrowing global vehicle production (SAAR) by 7 to 10 percentage points. Auto design wins rose 30% year-over-year and bookings rose 30% as well, with strength concentrated in China, Korea, and the broader Asia-Pacific region. Doogue cited a hybrid vehicle traction inverter win with a top Japanese OEM, share gains in Chinese 12- and 48-volt electromechanical braking systems, and the company's first major TMR angle sensor wins for ADAS steering motors with Chinese OEMs. He pushed back on the notion that focus auto (xEV and ADAS) has decelerated, pointing to S&P data showing roughly 25% EV production growth within Allegro's fiscal 2027, driven largely by Chinese export strength even as China's domestic EV market has been softer. China revenue grew 6% sequentially and represented 25% of total sales, with Doogue noting the company's market share had "gone up significantly over the past year" with one of its largest Chinese inverter customers.
Content per vehicle remains the central automotive thesis: Allegro sees a path from roughly $40 of content in legacy internal-combustion vehicles to upwards of $100 in next-generation battery electric vehicles. Electromechanical braking and steer-by-wire systems, which Doogue said are proliferating faster in China than initially expected, add incremental content on top of existing brake and steering sockets rather than displacing them—a dynamic management believes supports double-digit automotive growth even in a flat-to-declining SAAR environment.
Margin Trajectory: Pricing and Mix Still a Multi-Quarter Story
Gross margin reached 51.1%, up 290 basis points year-over-year, though D'Antilio was careful to attribute the improvement primarily to operating leverage and favorable mix rather than pricing, which he said contributed only "an early and lesser extent" this quarter. Allegro is taking selective price increases, largely in the distribution channel, to offset commodity cost inflation, while simultaneously renegotiating auto contracts that reset at the start of the calendar year—contracts that came in with low-single-digit price declines, consistent with industry norms. D'Antilio expects pricing actions and bill-of-material optimizations, including a shift from gold to copper wire bonding, to become more impactful in the third and fourth fiscal quarters, keeping the company on a multi-year path toward its 55%-plus gross margin target set at its analyst day roughly six months ago.
Operating margin expanded to 19.4% from 11.1% a year earlier, and the company guided second-quarter revenue to $265 million to $275 million, implying 26% year-over-year growth at the midpoint, with non-GAAP EPS of $0.23 to $0.26. Management flagged that a growing proportion of orders are arriving within lead times and cannot be shipped in the quarter received, creating a modest backlog of delinquent shipments across both auto and data center that should flow through over coming quarters—a signal of demand outstripping near-term capacity rather than any softening in end-market appetite.