Solectron Corp. reported its net profit fell by nearly 50% in it's recently ended 2Q07 but forecast a profit range in-line with analyst expectations and revenue above the expected range, sending shares higher by more than 2% in after hours action. By the numbers, profit came in at just $15.3 million, good for EPS of $0.02, versus EPS of $0.03 (net earnings of $30.4 million) in the year-ago period. Revenue rose 16% to $2.9 billion. Reuters estimates had the Street looking for EPS of $0.05 on revenue of $2.9 billion. Looking ahead to next quarter, the company expects adjusted EPS of $0.04 to $0.06 on revenue of $2.9 to $3.1 billion. Analysts were looking for EPS of $0.05 on revenue of just $2.87 billion. Shares climbed $0.08 to $3.16 after hours. Solectron announced it would be cutting between 1,300 and 1,500 employees, roughly 3% of its workforce, in a major restructuring designed to bring the company long-term savings.
Sources: Press Release, Reuters, AP (i), (ii)
Commentary: Solectron: CEO Split for Dell Could Mean Bad News • Contra Heard Bargain Hunts: Zarlink, ATS Automation & Solectron • Jabil Circuit Slips On Soft Guidance
Stocks/ETFs to watch: Solectron Corporation (SLR). Competitors: Jabil Circuit (NYSE:JBL), Benchmark Electronics (NYSE:BHE), Sanmina-SCI Corporation (NASDAQ:SANM)
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