Linear Technology Corp Earnings: Revenues Fall, Bringing Down Profit

S&P 500 (NYSE:SPY) component Linear Technology Corporation (NASDAQ:LLTC) posted a decrease in profit as revenue declined. Linear Technology offers a line of standard high performance linear integrated circuits.

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Linear Technology Earnings Cheat Sheet for the Second Quarter.

Results: Net income for the semiconductor company fell to $87.9 million (38 cents per share) vs. $143.7 million (62 cents per share) a year earlier. This is a decline of 38.9% from the year earlier quarter.

Revenue: Fell 23.3% to $294.3 million from the year earlier quarter.

Actual vs. Wall St. Expectations: LLTC reported adjusted net income of 45 cents per share. By that measure, the company beat the mean estimate of 39 cents per share. Analysts were expecting revenue of $293.1 million.

Quoting Management: According to Lothar Maier, CEO, “This was an encouraging quarter in a difficult global economic environment. We met the mid point of our guidance and we believe that we are at an inflection point in our business. Bookings, which started slowly, strengthened in December and continued strengthening in January. In these challenging times we maintained strong profitability, reporting operating margins at 45% of sales. Given the improvement in our bookings and our current outlook for the March quarter, we are estimating that we will grow quarterly revenues sequentially in the 4% to 8% range for our fiscal third quarter. As we announced earlier, we have acquired Dust Networks, a leading provider of wireless sensor networks.”

Key Stats:

The company has now seen net income fall in each of the last two quarters. In the first quarter, net income fell 21% from the year earlier quarter.

Revenue has fallen for the past three quarters. In the first quarter, revenue declined 15.1% to $329.9 million while the figure fell 2.1% in the fourth quarter of the last fiscal year from the year earlier.

The company topped expectations last quarter after falling short of forecasts in the first quarter with net income of 48 cents versus a mean estimate of net income of 50 cents per share.

The company’s cost of sales fell 10.6% from a year earlier to $73.8 million. Last quarter, cost of sales was 25.1% or revenue versus 21.5% a year earlier.

Looking Forward: Over the past ninety days, the average estimate for the third quarter has fallen from 52 cents per share to 41 cents, indicating that analysts are growing pessisimistic about the company’s performance next quarter. The average estimate for the fiscal year is $1.73 per share, down from $2.08 ninety days ago.

Competitors to Watch: Texas Instruments Inc. (NYSE:TXN), Analog Devices, Inc. (NYSE:ADI), National Semicond. Corp. (NYSE:NSM), Maxim Integrated Products Inc. (NASDAQ:MXIM), Intersil Corporation (NASDAQ:ISIL), Micrel, Incorporated (NASDAQ:MCRL), Advanced Analogic Tech. Incorp. (NASDAQ:AATI), ON Semiconductor Corp. (NASDAQ:ONNN), Semtech Corporation (NASDAQ:SMTC), and Microchip Technology Inc. (NASDAQ:MCHP).

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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