Xilinx stock price soars 6% as 5G firm raises revenue forecast

Xilinx stock price soars 6% as 5G firm raises revenue forecast
  • Xilinx now expects a preliminary revenue of $720 million to $734 million for the fiscal first quarter
  • The company says that the uptick in revenue is mostly due to the easing of restrictions on Chinese companies
  • Xilinx share price soared around 6% in premarket trading on the latest news

Shares of Xilinx, Inc (NASDAQ: XLNX) surged nearly 6% today after the company raised its fiscal first-quarter revenue guidance. As a result, the buyers are now pushing the stock price towards the 5-month high.

Fundamental analysis: Business boosted by increase in traffic with China

Xilinx, a developer of highly flexible and adaptive processing platforms, raised its fiscal first-quarter revenue guidance today. The California-based company says it noted a surge in the demand as the global markets revolver from the COVID-19 outbreak.

Xilinx’s announced a preliminary revenue of $720 million to $734 million for the fiscal first quarter. This is higher compared to the previous forecast. 

Stemming from the work-from-home regime, Xilinx’s sales have been boosted by the surge in online activity across the globe.

“While we have seen some Covid-19 related impacts during the June quarter, our business has generally performed well overall,” Victor Peng, Xilinx’s chief executive officer, said in a statement.

The company says that the uptick in revenue is mostly due to the easing of restrictions on Chinese companies.

“A portion of the revenue strength in the quarter was due to customers accelerating orders following recent changes to the U.S. government restrictions on sales of certain of our products to international customers,” Peng added.

Xilinx is heavily benefiting from its earlier investments in the 5G sector. Invezz reported earlier that Xilinx stock is well-positioned to reap the benefits from the 5G revolution. 

Technical analysis: New multi-month highs targeted

Xilinx stock price gained around 6% in premarket following the upgrade of the fiscal first-quarter revenue outlook. Shares of the company gained around 1% yesterday as the buyers successfully defended the 200-DMA near the $90 mark. 

Xilinx stock daily chart (TradingView)

The buyers will now target a move to $98.17, which is the June high. Moreover, this level represents a 5-month high for Xilinx share price. The key descending trend line comes around the $100 handle and it will represent the next layer of resistance for the bulls.

Summary

Xilinx share price is trading over 5% in premarket trading today after the tech giant raised its fiscal first-quarter revenue guidance. The company has benefited from the easing of restrictions on Chinese companies and a surge in online activity across the globe.

By Michael Harris
Specialising in economics by academia, with a passion for financial trading, Michael Harris has been a regular contributor to Invezz. His passion has given him first hand experience of trading, while his writing means he understands the market forces and wider regulation.
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