Semi scores: 6 up, 4 off, 3 lose

Electronic News, July 27, 1992 by Howard P. Grund

SAN JOSE, CALIF.--An uptake in semiconductor orders is being reflected in June-quarter financial results of many mid-level semiconductor manufacturers, most of which saw sales rise--although profitability seemed largely dependent on the major product lines of each firm. Nine of 13 second- and third-tier chip makers posted higher sales, although only six showed improved earnings. Another four companies remained profitable, albeit at lower levels, while three posted Q2 losses.

Lattice Semiconductor, Zilog, Xilinx, Brooktree Semiconductor, Dallas Semiconductor and Sierra Semiconductor all posted earnings gains; while Cirrus Logic, Atmel, Vitesse and Altera showed earnings declines, although remaining profitable.

Nevertheless, price pressure in the PC-oriented chip-set market proved a drag on VLSI Technology and LSI Logic, which posted quarterly losses; while Cypress Semiconductor, reflecting the impact of a one-time restructuring charge, also posted a June-quarter loss.

Cirrus Logic posted 30 percent lower first-quarter earnings of $4.5 million, or 20 cents a share, reflecting costs of its purchase of Acumos Inc. during the quarter, as well as the impact of the acquired firm's lower margins. This is down from last year's net of $6.5 million, or 30 cents a share. The quarter's results reflected a $2.2 million pre-tax charge for costs associated with the purchase of graphic controller maker Acumos, which the company completed during the quarter for about $70 million in stock.

For the three months ended June 30 Cirrus' sales rose 21 percent to $63 million, up from $51.7 million last year. The company said it has restated financial results for all periods to reflect the Acumos acquisition, although Cirrus did not disclose what portion of its own current sales or net were generated by the formerly privately held Acumos.

"Mass storage revenue growth was driven by a combination of the strong demand for lower capacity products and increased demand for the new high capacity 3.5-inch drives and new small-form-factor disk drives," said Michael L. Hackworth, president and chief executive. "Our graphics products experienced strong demand in both the portable and desk-top personal computer market segments."

Xilinx posted 3 percent higher earnings of $5.9 million, or 25 cents a share, for its first fiscal quarter ended June 27, from $5.8 million, or 24 cents a share, on sales which jumped 18 percent to $39 million, from $33.2 million. Additional R&D expenses on FPGA and PLD devices plus higher engineering costs for masks and wafers limited the earnings rise, it said.

Brooktree cited improved PC maker demand, posting a 9 percent rise in earnings to $2.9 million, or 17 cents a share, from $2.6 million, or 17 cents a share, last year, for its fiscal Q3, on 9 percent higher revenues of $24.3 million from $22.3 million. Nine-month earnings rose 47 percent to $9.8 million, or 59 cents a share, including a Q2 $900,000 after-tax gain on the sale of its Bristol development center, from $6.6 million, or 46 cents a share, last year, on 9 percent higher sales of $66.7 million from $60.9 million.

Dallas Semiconductor said increased domestic distributor revenues partly accounted for 12 percent higher earnings of $4.7 million, or 18 cent a share, for Q2, from $4.1 million, or 16 cents a share. The CMOS IC maker posted 5 percent higher sales of $30 million, from $28.5 million. For the first half, earnings were $8.3 million, or 32 cents a share, up slightly from $8.1 million, or 32 cents a share, for the period last year, on slightly lower sales of $55.3 million from $56 million.

Lattice Semiconductor posted a 44 percent jump in Q1 earnings of $3.4 million, or 28 cents per share, from $2.4 million, or 20 cents a share, last year, on 21 percent higher sales for the PLD maker of $20.6 million, from $17.0 million.

Zilog reported a 44 percent rise in Q2 earnings to $3.6 million, or 32 cents a share, from $2.5 million, or 26 cents a share, last year, on 22 percent higher sales of $33.3 million, from $27.1 million. Outstanding common rose 17 percent to 11.3 million shares, from 9.6 million last year, the firm noted. First-half earnings rose 61 percent to $6.8 million, or 62 cents a share, from $4.2 million, or 48 cents a share; sales rose 19 percent to $62.7 million from $52.3 million.

Altera cited intense PLD price competition as a partial cause for a Q2 earnings tumble of 29 percent to $3 million, or 15 cents a share, from $4.2 million, or 21 cents a share, last year. Sales for the user-configurable IC maker fell 12 percent to $23 million, from $26 million. The company claimed an undisclosed expense due to distributor price protection, resulting from the pricing fray. First-half profit, however, grew 5 percent to $8.3 million, or 40 cents a share, from $7.9 million, or 39 cents a share, for the like period last year, on sales up 7 percent to $52.8 million, from $49.2 million.

Atmel posted 14 percent lower Q2 earnings of $3 million, or 17 cents a share, from $3.5 million, or 19 cents a share, last year, on 8 percent higher sales of $33 million, from $30.5 million. First-half earnings fell 8 percent to $5.4 million, or 31 cents a share, from $5.9 million, or 37 cents a share, for the like period last year, while sales fell 3 percent to $61.9 million, from $64.3 million.