Altera Corp Earnings: Profit Falls Behind Revenue Decline

S&P 500 (NYSE:SPY) component Altera Corporation (NASDAQ:ALTR) posted a decrease in profit as revenue declined. Altera designs and manufactures programmable logic devices, HardCopy ASIC devices, pre-defined design building blocks, cores, and associated development tools.

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Altera Earnings Cheat Sheet for the Fourth Quarter

Results: Net income for the semiconductor company fell to $146.6 million (45 cents per share) vs. $231.6 million (72 cents per share) a year earlier. This is a decline of 36.7% from the year earlier quarter.

Revenue: Fell 17.6% to $457.8 million from the year earlier quarter.

Actual vs. Wall St. Expectations: ALTR beat the mean analyst estimate of 41 cents per share. It beat the average revenue estimate of $447.5 million.

Quoting Management: “While industry conditions led to sequential sales declines in the fourth quarter, Altera grew six percent in 2011-well ahead of most of the semiconductor industry. Our FPGA market share once again improved,” said John Daane, president, chief executive officer, and chairman of the board. “As we have seen over the last several years, there are long-term technology-based trends that favor FPGAs. We continue to believe that these factors, plus ongoing FPGA share gains, give us the potential over time for sales growth twice that of the semiconductor industry.”

Key Stats:

The company has now seen net income fall in each of the last two quarters. In the third quarter, net income fell 14.8% from the year earlier quarter.

The company topped expectations last quarter after falling short of forecasts in the third quarter with net income of 57 cents versus a mean estimate of net income of 59 cents per share.

Revenue has fallen in the past two quarters. In the third quarter, revenue declined 0.9% to $522.5 million from the year earlier quarter.

The company’s cost of sales fell 15.2% from a year earlier to $136.8 million. Last quarter, cost of sales was 29.9% or revenue versus 29% a year earlier.

Looking Forward: The outlook for the company’s results in the upcoming quarter is unfavorable. The average estimate for the first quarter of the next fiscal year is 42 cents per share, down from 50 cents ninety days ago. At $2.32 per share, the average estimate for the fiscal year has fallen from $2.38 ninety days ago.

Competitors to Watch: Lattice Semiconductor (NASDAQ:LSCC), Xilinx, Inc. (NASDAQ:XLNX), QuickLogic Corporation (NASDAQ:QUIK), Texas Instruments Inc. (NYSE:TXN), Microsemi Corporation (NASDAQ:MSCC), Cypress Semicond. Corp. (NASDAQ:CY), ON Semiconductor Corp. (NASDAQ:ONNN), Broadcom Corporation (NASDAQ:BRCM), TranSwitch Corporation (NASDAQ:TXCC), and Aeroflex Holding Corp. (NYSE:ARX).

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

To contact the reporter on this story: Derek Hoffman at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com