Fairchild Semi Updates Q2 Outlook

Electronic News, June 4, 2001

FAIRCHILD SEMICONDUCTOR INTERNATIONAL LTD. HAS Lowered its expectations for the second quarter, saying it now expects revenues to be down about 5 percent instead of flat with the previous quarter. For the first quarter, Fairchild (nyse: FCS) reported $385.3 million in revenues, which were down 18 percent sequentially. The company posted adjusted net income of $26.1 million, or 26 cents per diluted share.

"During our first-quarter-earnings conference call about six weeks ago, we guided analysts to expect our revenues to be flat to down 5 percent sequentially from the first quarter. Our current view is that sales will be in the low end of that range," said Kirk Pond, Fairchild president, chairman and chief executive officer, in a statement.

Pond said the South Portland, Maine-based company is expecting the market to bottom out this summer, as cancellations have slowed from the first quarter. Meanwhile, the company's turns business, or orders that are shippable within the same quarter, has grown significantly, Pond said.

"Roughly one-third of our bookings in April and May have been for second-quarter delivery. As we indicated in our conference call, pricing has remained very aggressive, as much of the business we are booking is for near-term demand, and the environment is very competitive," he said.

Fairchild's book-to-bill ratio for the quarter is up from about environment is very competitive," he said. 0.7:1 in the first quarter to about 0.86:1 in the second quarter.