Wed, Aug. 19, 5:51 PM
- While Semtech (NASDAQ:SMTC) beat FQ2 revenue estimates and posted in-line EPS, it's guiding for FQ3 revenue of $110M-$120M and EPS of $0.21-$0.27, below a consensus of $129.5M and $0.29.
- Enterprise-related sales were strong in FQ2, but demand from Semtech's other three end-markets fell, and the company reiterates sales to Korean smartphone OEMs are weak. Samsung is known to be a major client.
- Given top-line pressures, gross margin held up fairly well, falling just 40 bps Q/Q and Y/Y to 60.4%. GAAP operating costs/expenses rose 10% Y/Y to $72.5M - job cuts were announced in mid-July.
- Shares have fallen to $15.50 after hours. Various analog/mixed-signal peers have also issued soft Q3 guidance in recent weeks. However, with the midpoint of Semtech's revenue guidance range implying a 23% Y/Y sales drop, its outlook also implies share loss.
- FQ2 results, PR
Wed, Aug. 19, 4:35 PM
Tue, Aug. 18, 5:35 PM
Tue, Aug. 18, 2:23 PM
- Having already felt the effects of a string of downbeat earnings reports, chip stocks are underperforming today amid a 0.5% drop for the Nasdaq. The Philadelphia Semi Index (SOXX -1.7%) is near its 2015 lows, and now down 9% YTD. Fresh Chinese macro fears - the Shanghai and Shenzhen exchanges both fell sharply overnight - could be playing a role.
- Micron (MU -4.9%), 4 days removed from hosting its analyst day and 1 day removed from seeing a slew of analysts respond, is among the names down strongly. BofA/Merrill downgraded NAND flash rival SanDisk and NAND controller vendor Silicon Motion to Underperform this morning, which citing Micron and SK Hynix's capex plans - Hynix says it's thinking of spending $39B on fab investments.
- Other major decliners that are tied to the industry include Skyworks (SWKS -5.3%), Qorvo (QRVO -3.6%), IDT (IDTI -6.3%), AppliedMicro (AMCC -4.3%), ChipMOS (IMOS -4.3%), Rambus (RMBS -3.8%), Silicon Labs (SLAB -3.1%), Semtech (SMTC -3.5%), MagnaChip (MX -4.4%), and Amkor (AMKR -3.6%).
- Needless to say, multiples for many hard-hit names have come down considerably over the last two months.
- Chips ETFs: SMH, XSD, PSI, SOXL, USD, SOXS, SSG
Wed, Jul. 15, 5:27 PM
- Semtech (NASDAQ:SMTC) CEO Mohan Maheswaran: "Given our recent revenue decline driven primarily by weak Korean smartphone demand, we have made the very difficult decision to reduce our headcount and operating expenses across a majority of Semtech's locations ... Our recent investments in infrastructure such as our SAP® ERP system, and our Salesforce.com® and Workday® systems, will allow us to scale more efficiently as our revenue grows." (Press Release)
- The analog/mixed-signal chipmaker expects to record $3.5M worth of charges, and achieve $20M worth of annual cost savings. It's two months removed from posting an FQ1 miss and issuing soft FQ2 guidance. The FY16 (ends Jan. '16) revenue consensus of $524.2M implies a 6% Y/Y decline.
- FQ2 results are expected in late August.
Tue, Jun. 23, 6:07 PM
- NiSource spinoff Columbia Pipeline Group (CPGX) is taking Allegeheny Technologies' (NYSE:ATI) spot in the S&P 500. Allegheny will join the S&P MidCap 400.
- Also joining the S&P 400: Casey's General Stores (NASDAQ:CASY), Graham Holdings spinoff Cable One, DuPont spinoff Chemours, and the post-spinoff Energizer (NYSE:ENR).
- Getting dropped to the S&P SmallCap 600 from the 400: Unit Corp. (NYSE:UNT), Harsco (NYSE:HSC), and Semtech (NASDAQ:SMTC).
- Also joining the S&P 600: Nektar (NASDAQ:NKTR), Masco spinoff TopBuild, and the new/post-spinoff Gannett (NYSE:GCI). Gannett's broadcast/digital spinoff Tegna (Pending:TGNA) will have old Gannett's spot in the S&P 500.
- Getting dropped from the S&P 600, and not moving up: Aeropostale (NYSE:ARO), Paragon Offshore (NYSE:PGN), PetroQuest (NYSE:PQ), Quiksilver (NYSE:ZQK), and FXCM.
- Leaving the S&P 400, and not moving elsewhere: Peabody (NYSE:BTU) and AOL (acquired by Verizon).
- ATI -1% AH. UNT -0.7%. ARO -1.1%. PQ -1.9%. BTU -1.1%. NKTR +5.2%.
- Press Release (.pdf)
Thu, May 28, 12:47 PM
Wed, May 27, 5:15 PM
- After coming off a halt, Semtech (NASDAQ:SMTC) has fallen to $22.00 in AH trading thanks to its FQ1 miss and soft guidance. The analog/mixed-signal chipmaker expects FQ2 revenue of $120M-$130M and EPS of $0.21-$0.26, below a consensus of $141.7M and $0.37.
- The FQ1 miss is blamed on "much lower than anticipated demand" from Semtech's biggest smartphone customer. FQ2 sales guidance appears to imply share loss, given it translates to a 14% Y/Y revenue decline at the midpoint.
- To help soften the blow, Semtech has upped its buyback authorization to $100M; $20M was spent on buybacks in FQ1.
- Shares rose 5.4% in regular trading, aided by the Broadcom/Avago report.
- FQ1 results, PR
Wed, May 27, 4:31 PM
Wed, May 27, 3:00 PM
- Chip stocks are posting outsized gains (SOXX +4%) amid a 1.3% increase for the Nasdaq after the WSJ reported Avago and Broadcom are in advanced merger talks, sparking hopes for further M&A.
- A Broadcom/Avago deal would be worth ~$67B at current valuations, easily making it the largest in the chip industry's breathless consolidation wave. It would also touch markets ranging from smartphones to set-tops to servers to switches/routers.
- Notable gainers include Avago RF chip peers Skyworks (SWKS +4.3%), Qorvo (QRVO +3.2%), and Anadigics (ANAD +4.9%). Others include Micron (MU +3.8%), SanDisk (SNDK +4.3%), NXP (NXPI +3.5%), Silicon Motion (SIMO +8.3%), Cirrus Logic (CRUS +4.8%), STMicroelectronics, (STM +3.4%), Synaptics (SYNA +3.4%), Atmel (ATML +2.8%), Cavium (CAVM +4.5%), Intersil (ISIL +4.6%), Semtech (SMTC +3.9%), ON Semi (ON +3.8%), Microsemi (MSCC +4.4%), and IDT (IDTI +4.2%).
- Non-chipmakers tied to the industry are also doing well. Standouts include ARM (ARMH +4.4%), Amkor (AMKR +4.6%), ASML (ASML +3.1%), and Rambus (RMBS +3.3%).
- Chip ETFs: SMH, XSD, PSI, SOXL, USD, SOXS, SSG
Tue, May 26, 5:35 PM
Fri, Apr. 24, 2:03 PM
- Though the Nasdaq is up 0.7% thanks to market-pleasing earnings from Google, Microsoft, and Amazon, chip stocks (SOXX -2.1%) are adding to their Thursday losses after Freescale, Altera, Microsemi, and Maxim joined the ranks of chipmakers offering soft Q2 guidance; Texas Instruments, Xilinx, and Qualcomm did so on Wednesday afternoon.
- NXP (NXPI -4.3%), set to merge with Freescale in a cash/stock deal, is selling off ahead of its April 29 Q1 report. RF chipmakers Skyworks (SWKS -3.8%), Qorvo (QRVO -4.4%), and Avago (AVGO -5.2%) are also seeing steep declines.
- Other decliners include a slew of telecom/networking, microcontroller, and analog/mixed-signal chipmakers. The group includes Marvell (MRVL -3%), ON Semi (ON -6.9%), Atmel (ATML -3.3%), Cypress (CY -4%), Lattice (LSCC -3.9%), Semtech (SMTC -6.9%), Cavium (CAVM -6%), PMC-Sierra (PMCS -2.9%), InPhi (IPHI -3.8%), and Silicon Labs (SLAB -2.9%). Chip packaging/testing firm Amkor (AMKR -5.7%) is also off; its Q1 report arrives on Monday.
- As was the case with TI and Xilinx, soft telecom equipment chip demand was often blamed by those guiding light yesterday afternoon. Freescale (FSL -3.5%) stated it expects network processor division sales to be down Q/Q and RF (base station power amplifier) division sales to be flat. Microcontroller, automotive, and analog and sensor division sales are expected to rise.
- Altera (ALTR -3.3%) stated its "telecom and wireless business, and particularly our wireless business globally looks to be quite weak in [Q2], while the rest for our business will in aggregate be flat to slightly up." Regarding its Q1 miss, the company notes "Industrial, test, compute and storage, and to a lesser extent military, fell short of our forecast" (share loss to Xilinx?).
- Maxim reports seeing "broad-based softness in communications infrastructure demand" and soft industrial bookings to go with healthier mobile/auto demand. The Galaxy S6 appears to be giving a lift to Maxim's mobile sales.
- Chip ETFs: SMH, XSD, PSI, SOXL, USD, SOXS, SSG
Tue, Apr. 14, 5:43 PM
- Semtech (NASDAQ:SMTC) has divested its defense/aerospace chip business to Jariet Technolgies, a newly-formed company in which Semtech will have a minority stake. The company previously said it was looking divest/shut down the business due to concerns about time-to-revenue.
- In tandem with the move, chief strategy officer Charles Harper has resigned to become Jariet's CEO.
Tue, Apr. 14, 2:01 PM
- TowerJazz (NASDAQ:TSEM) has begun ramping production for several new product families offered by analog/mixed-signal chipmaker Semtech (SMTC -2.2%). The chips are being made at TowerJazz's Fab 2 (uses 200mm wafers).
- TowerJazz is less than a dollar away from a 52-week high of $18.29. Semtech is off on what has been a moderately weak day for chip stocks.
Fri, Mar. 27, 10:34 AM
- Raymond James has downgraded analog/mixed-signal chipmakers Diodes (DIOD -4.7%) and Semtech (SMTC -4.9%) to Outperform from Strong Buy, and peer Power Integrations (POWI -3%) to Market Perform from Outperform.
- All three companies sold off on Wednesday amid a chip stock rout that some blamed on cautious remarks from TSMC about near-term demand. Semtech fell earlier this month due to the light FQ1 guidance provided with an FQ4 beat.
Thu, Mar. 5, 12:45 PM
SMTC vs. ETF Alternatives
Semtech Corp designs, develops and markets products for commercial applications, the majority of which are sold into the enterprise computing, communications, high-end consumer and industrial end-markets.
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