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Product category: Power Supply ICs and Controllers
News Release from: Fairchild Semiconductor
Edited by the Electronicstalk Editorial Team on 26 October 2001

Fairchild sees beginning of
the end (of downturn)

Fairchild Semiconductor has reported results for the third quarter ended 30th September 2001

Revenues were $325.4 million, slightly higher than mid-quarter guidance issued by the company on 6th September 2001 and down 12.6% sequentially from the second quarter of 2001. "Fairchild aggressively grew market share again this quarter by continuing to introduce new products and gain design wins", said Kirk Pond, president, CEO and chairman of the board.

"Strong companies capture market share in down markets, and we have been accomplishing that goal throughout this year.

While our revenues were down 32% from the third quarter of 2000, we outperformed the industry, which was down more than 45% in the same period.

We introduced more than 145 new products this quarter, raising our total through nine months to more than 385, well ahead of our 2000 run rate.

We won designs in a wide variety of consumer, computer, power supply, and automotive segments.

Our bookings improved 23% sequentially, and our book-to-bill ratio for the quarter was slightly greater than 1:1", continued Pond.

"Our turns business, which comprises orders for shipment within the same quarter, was unusually strong.

We turned 28% of our third quarter bookings into revenue during this quarter.

Visibility remains low, however.

While our 13-week backlog grew 14% through the quarter, our 26-week backlog remained nearly unchanged.

We remain in a deal-driven market characterised by short term delivery demands and aggressive pricing", Pond said.

"My experience through several semiconductor cycles has been that a combination of high turns, an improving book-to-bill ratio, low backlog visibility and aggressive pricing has always marked the beginning of the end of the downturn".

Third quarter adjusted net loss was $8.8 million, or $0.09 per share of common stock, as compared with adjusted net income of $84.0 million, or $0.82 per diluted share in the third quarter of 2000.

Adjusted net income is net income before amortisation of acquisition-related intangibles, restructuring and other unusual items.

During the quarter the company had unusual charges of $1.8 million which were for in-process research and development associated with the acquisition of Impala Linear Corp and also employee severance charges.

Third quarter gross margins were 20.0%, due mainly to lower pricing and lower factory utilisation due to significant reductions in inventories.

Including amortisation of acquisition-related intangibles, restructuring and other unusual items, the company reported a net loss in the third quarter of $19.1 million, or $0.19 per share, compared with net income of $69.7 million, or $0.68 per diluted share in the third quarter of 2000.

For the first nine months of 2001, the company reported revenues of $1,083.1 million, an 18% decrease from the $1,314.4 million reported for the first nine months of 2000.

For the first nine months of 2001, adjusted net income was $23.1 million or $0.23 per diluted share, compared with $205.6 million, or $2.03 per diluted share in the first nine months of 2000.

Including amortisation of acquisition-related intangibles, restructuring and other unusual items, the company had a net loss of $25.5 million or $0.26 per share in the first nine months of 2001, compared with net income of $179.4 million, or $1.77 per diluted share in the first nine months of 2000.

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