GuidanceThe consensus estimate is 24c for EPS and revenue $457.42M, according to First Call. The company negatively pre-announced its F3Q results to be worse than previously expected. Q3 revenues are expected to be down -9% to -10% quarter-over-quarter, in the range of $450M to $455M, versus prior range of down -1% to -5% quarter-over-quarter with incremental weakness due to softness in the company's handset business, which is one-third of revenues. Guidance for the gross margin was approximately 63%, down from 64.4% in Q2.
Analyst ViewsDeutsche Bank believes continuing problems at Motorola (MOT) is contributing to the handset weakness at National Semiconductor. Deutsche is currently modeling Q4 GAAP EPS of 27c and revenues of $464M, which is below consensus Street estimates of 29c on revenues of $472.45M. Deutsche said, given the continuing turmoil in the global macro environment they would not be surprised if the company provided a cautious outlook this time around.
Jefferies said recently, that their proprietary channel checks in Asia with respect to RF Micro Devices (RFMD) indicated that distributor inventory continued to build post-Chinese New Year. As such, Jefferies believes National's Q4 guidance may fall short of their estimates of 29c on $472.3M in revenues.
Key focus items for the conference call: Comments and outlook for bookings/billings; gross and operating margin guidance, on Feb.15, national Semi said they expect their gross margin to be above 60% in fiscal year 2008, similar to the previous year; comments on Inventory and lead times; and comments on end-demand.