By Kristin Jones
OmniVision Technologies Inc.'s (OVTI) fiscal second-quarter
profit dropped 50% as high manufacturing costs pressured the chip
maker's margins, masking a jump in revenue.
Shares fell 2.8% after hours to $15.45. Through the close, the
stock was up 30% so far this year.
OmniVision generates the biggest chunk of its business in the
smartphone sector, and its results have been closely linked to that
market. Its products include camera sensors for phones, including
Apple Inc.'s (AAPL) iPhone.
In the latest quarter, gross margin narrowed to 16.6% from 30.6%
a year earlier, as input costs jumped. The company noted a
quarter-over-quarter increase in the shipment of advanced products
with high manufacturing costs.
Chief Executive Shaw Hong said that the company has been taking
actions to improve its corporate gross margins.
The company also said that Raymond Wu, one of the company's
co-founders, will rejoin the company as president, starting Dec. 1.
Mr. Wu resigned in 2006 from the role of executive vice president,
in which he held sales and marketing responsibilities.
"We are enthused by his return, and with his knowledge of our
company and the industry, I expect Raymond to make significant
contributions to OmniVision's continued growth in the years to
come," said Mr. Hong, who previously held the role of
president.
For the quarter ended Oct. 31, OmniVision reported a profit of
$10.3 million, or 19 cents a share, down from $21.1 million, or 35
cents a share, a year earlier. The year-earlier period included a
$8.6 million gain from the acquisition of production operations
from VisEra Technologies Co.
Excluding stock-based compensation and other items, earnings
were down at 33 cents from 48 cents.
Revenue jumped 79% to $390 million.
OmniVision in August had projected per-share earnings of 21
cents to 37 cents on revenue of $355 million to $390 million.
For the current quarter, Omnivision forecast adjusted per-share
earnings of 33 cents to 46 cents on revenue of $390 million to $425
million. Analysts polled by Thomson Reuters most recently expected
a profit of 35 cents a share on revenue of $365 million.
Write to Kristin Jones at kristin.jones@dowjones.com
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