DOW JONES NEWSWIRES
Altera Corp.'s (ALTR) second-quarter profit tumbled 52% as
revenue and margins fell, while the results were also lowered by a
$11.5 million tax expense charge.
Still, shares climbed 4.5% to $17.30 in after-hours trading, as
the logic-chip maker's sales momentum continued on a sequential
basis and adjusted earnings topped analysts' estimates.
However, some on Wall Street have been skeptical of how much the
recent recovery in chip orders reflects an improvement of industry
fundamentals. Altera sees third-quarter revenue dropping
sequentially, issuing a target below analyst expectations.
The company reported earnings of $47.4 million, or 16 cents a
share, down from $98 million, or 32 cents a share, a year earlier.
The latest quarter included an additional charge of 4 cents per
share as a result of the U.S. court ruling related to worldwide
equity compensation cost sharing. Altera wasn't a party to the
case.
Analysts polled by Thomson Reuters expected per-share earnings
of 16 cents.
Revenue decreased 22% to $279.2 million. Last month, the company
backed its projection for a 2% to 7% sequential rise in revenue,
translating to a range of $269.9 million to $283.1 million.
Total operating expenses dropped 7.1%. Gross margin fell to
66.5% from 67.1%.
Looking ahead, Altera expects third-quarter sales to go down 1%
to 5% sequentially. That range would be $265.2 million to $276.4
million, lower than Wall Street's view of $279 million.
The company also predicted gross margin of 67%, plus or minus
half of a percentage point.
Altera designs chips that customers can program for use in such
products as Internet routers, mobile-phone base stations,
flat-panel televisions and DVD players.
-By John Kell, Dow Jones Newswires; 212-416-2480;
john.kell@dowjones.com