Seeking Alpha

Linear slides as FQ2 guidance overshadows FQ1 beat

  • Though Linear (LLTC -1.5%) beat FQ1 estimates, FQ2 sales are expected to be flat to down 4% Q/Q; that's worse than a consensus for 1% growth. The analog chipmaker blames seasonal order weakness and the potential for the government shutdown (about to end) to affect U.S. sales.
  • FQ1 book-to-bill was "slightly positive," and $7.9M was spent in the quarter on buybacks. Gross margin was 75.3%, +20 bps Y/Y. Automotive accounted for 19% of FQ1 bookings (a historical high), and Linear claims its 45.9% op. margin is unmatched within the industry. The company has been criticized in the past for prioritizing margins over growth.
  • Analog rival Semtech (SMTC -0.3%) is also underperforming, but other peers are following the market higher.
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