Product category: Communications ICs (Wired)
News Release from: National Semiconductor
Edited by the Electronicstalk Editorial Team on 14 September 2004
Record Q1 margins are tempered with
warning for Q2
National Semiconductor Corp has reported a GAAP profit of $117.7 million, or $0.31 per share, on revenues of $548 million for the first quarter of fiscal 2005, which ended 29th August 2004.
National Semiconductor Corp has reported a GAAP profit of $117.7 million, or $0.31 per share, on revenues of $548 million for the first quarter of fiscal 2005, which ended 29th August 2004 National's first quarter sales were 29% higher than the first quarter of fiscal 2004, when the company reported sales of $424.8 million and earnings of $0.08 per share
This article was originally published on Electronicstalk on 5 Jan 2001 at 8.00am (UK)
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Sequentially, National's Q1 revenues were 4% lower than the fourth quarter of fiscal 2004, when the company recorded revenues of $571 million and earnings of $0.24 per share.
National's fourth quarter 2004 results included a $30 million pre-tax special charge for a litigation matter.
In the first quarter of fiscal 2005, National achieved a new record in gross margin of 55%, up from 54.4% in the prior quarter.
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For the first quarter of fiscal 2004, National's gross margin was 47%.
"National's business over the summer was affected by slower orders than we originally anticipated, particularly from our distribution channel", said Brian L Halla, National's Chairman, President and CEO.
"However, we continued to show positive results from our analogue focus and we're pleased that we were able to increase gross margin in a seasonally slow quarter".
"As a result of our continued focus on selling higher-value, higher margin analogue products, we provided shareholders with a 28% return on invested capital (ROIC) in Q1".
National's worldwide bookings in Q1 were 5% higher than last year's Q1.
But on a sequential basis, bookings declined 29% from the fourth quarter of fiscal 2004.
The decline in bookings was attributed to a combination of factors, including seasonally slower demand, shorter lead times which prompted distributors and OEM customers to reduce backlog coverage and supply chain corrections from flat panel display customers and some wireless handset customers in Asia.
The sequential decline in revenues for Q1 was directly related to lower-than-expected turns orders, which were driven by these same global market developments.
Turns orders are orders requested for delivery within the same quarter.
From a geographic market perspective, Q1 bookings declined sequentially in all regions.
Bookings in Europe and Japan were generally stronger than in the USA and Asia Pacific.
Weekly bookings improved slightly during the month of August compared with July.
Billings exceeded bookings in the first quarter.
National expects distributors and some customers to continue adjusting order backlog and inventories in Q2.
As a result, the company expects revenues may decline 8 to 10% sequentially during Q2.
This revenue range may be accompanied by gross margin of approximately 51%.
Operating expenses, meanwhile, are expected to be comparable to Q1.
"As we work through these inventory adjustments, National will continue to drive a proven business model that focuses on high-value analogue products", Halla said.
"This slowdown won't distract us from pursuing National's long-term objectives to create the best returns for our shareholders".
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