Seeking Alpha

Chip stocks outperform following positive earnings reports

  • Market-pleasing Q3 reports and better-than-feared guidance from Atmel (ATML +10.6%), Intersil (ISIL +4.2%), International Rectifier (IRF +11.4%), Microchip (MCHP +7.5%), Cavium (CAVM +8.9%), and Skyworks (previous) helped chip stocks trader higher (SOXX +0.6%) on a down day for tech
  • The gains followed a difficult month that saw many chipmakers (including a number with strong mobile exposure) provide disappointing Q4 guidance. While the guidance provided by the aforementioned companies wasn't stellar, it was better than feared in light of recent forecasts.
  • Atmel guided on its CC (transcript) for Q4 revenue of $350M-$364M, below a $364.9M consensus.
  • Intersil expects Q4 revenue of $142M-$148M and EPS of $0.16-$0.18 vs. a consensus of $149.1M and $0.17.
  • Microchip, viewed by some as an industry bellwether, was able to deliver in-line guidance: the company expects FQ3 revenue of $463.1M-$492.7M and EPS of $0.57-$0.63 vs. a consensus of $476.9M and $0.59.
  • International Rectifier expects FQ2 revenue of $260M-$270M vs. a $265M.1M consensus.
  • Cavium guided on its CC (transcript) for 1%-4% Q/Q revenue growth and EPS of $0.29-$0.31; the consensus is for 5% growth and EPS of $0.30.
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