Semtech (NASDAQ:SMTC) is expected to report Q2 earnings Wednesday after market close, with a conference call scheduled for 5:00 pm ET.
The consensus estimate is 23c for EPS and $78.8M for revenue, according to First Call. Guidance provided on the last earnings call was for EPS of 23c to 24c on revenue growth of 3% to 6%. The latest news was on August 5, when Semtech announced that a fire occurred at its Reynosa, Mexico fab, which services the Power Discrete business unit. The company stated there was partial damage to the facility along with some loss of equipment. Management expects to resume all operations within eight to nine weeks from that date. The fire is not expected to impact FQ2/09 revenues, but Semtech does expect an impact of less than $1M in Q3. In Q3, the company expects a $2M to $3M impact on revenues.
Morgan Keegan is comfortable with Semtech's ability to meet consensus expectations for Q2. Within the company's core business they expect solid traction in the July quarter to come from industrial, handsets/base stations, notebooks and the communication segments. Morgan Keegan is not expecting growth in the company's desktop business or a recovery in the test equipment segment. Going forward, Morgan Keegan had trimmed their Q3, October quarter estimates to account for the fire impact to 24c on $79.9M in revenue.