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Semtech Earnings Fall 17%

Camarillo firm meets expectations as chip prices drop and demand for products softens.

May 28, 2003|From Bloomberg News

Semtech Corp., a maker of semiconductors for mobile devices and computers, said fiscal first-quarter profit fell 17% as prices for personal-computer chips dropped and demand faltered for some of its products.

Net income declined to $8.27 million, or 11 cents a share, for the period ended April 27, from $10 million, or 13 cents, a year earlier. Sales decreased nearly 11% to $44 million from $49.2 million, the company said.

Sales to makers of PC games equipment and automated test gear were "weak," and average prices of products used to build PCs declined, Semtech said. But orders, which are used to gauge sales in three to six months, reached their highest level in a year. Semtech said it expects sales of chips for test equipment, PCs and mobile phones to start improving late this quarter.

Profit this quarter will be 9 cents or 10 cents on revenue that is unchanged to 2% higher, according to the company, which is headquartered in Camarillo. Semtech had net income of $11.1 million, or 14 cents, on sales of $52.1 million, in last year's second quarter.

Fiscal first-quarter profit met the average analyst estimate of net income of 11 cents in a Thomson First Call survey. The company missed the revenue estimate of $45.1 million.

Shares of Semtech fell as much as $1.15, or 6.8%, to $15.75 in extended trading after the announcement. The stock rose 64 cents to $16.90 in regular Nasdaq trading.

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