Cirrus Logic Inc.'s (CRUS) fiscal first-quarter earnings fell
48% as costs from an earlier production problem cut into the
semiconductor maker's margins.
Shares dropped 8.2% to $16.44 premarket Thursday. The stock was
still up 12% this year through the close.
The supplier of chips used in Apple Inc. (AAPL) devices such as
the iPod and iPad in April disclosed manufacturing problems with a
new audio device that had just entered high-volume production.
Cirrus said it expects to resolve the issue by the end of the
current quarter.
Still, Standard & Poor's Ratings Services in May upgraded
the chip maker, crediting its steady operating performance and
bright overall prospects.
For the quarter ended June 25, Cirrus Logic reported a profit of
$9.2 million, or 13 cents a share, down from $17.6 million, or 25
cents a share, a year earlier. Excluding stock-based compensation,
tax provisions and other items, per-share earnings were 24 cents,
down from 29 cents. Analysts had most recently forecast 24
cents.
Revenue rose 13% to $92.2 million. The company in April
projected $88 million to $94 million, a downbeat view at the
time.
Gross margin narrowed to 51.7% from 57.1% as input cost jumped
27%.
Sales in the company's audio segment--its main top-line
contributor--rose 32%, while revenue fell 24% in the smaller energy
unit.
The company expects revenue between $101 million and $105
million in its second quarter, in line with analysts' $103 million
estimate, according to a poll by Thomson Reuters. The company also
forecast gross margin of 52% to 54% for the current quarter.
-By Drew FitzGerald, Dow Jones Newswires; 212-416-2909; Andrew.FitzGerald@dowjones.com