Altera Narrows Guidance – Analyst Blog

Chipmaker Altera Corporation (ALTR) revised its outlook for the first quarter of 2010. The company now expects revenues to be up 7% – 10% sequentially compared to the previous guidance of 5 – 10%. The new outlook implies a revenue guidance of $390.5 million – $401.5 million.

 

Altera expects solid growth from new products in the first quarter. All four vertical market segments (Telecom & Wireless, Industry Automation, Military&Auto, Networking, Computer & Storage and Others) are likely to report sequential improvements. Growth continues in the telecom and wireless market segment as communications equipment manufacturers respond to the ongoing Asian demand.

 

Fourth quarter results beat expectations driven by broad-based growth. All the markets performed better than management’s expectations due to a combination of new program ramps, improved end-market demand, and an increase in customer take rate due to inventory depletion.

 

Net income came in at $103 million or 34 cents per share. The reported net income per share easily beat the Zacks Consensus Estimate of 29 cents.

 

The current Zacks Consensus Estimate for the first quarter of 2010 is 39 cents per share with no potential upward surprise.

 

In the most recently reported quarter, the company reported earnings 17.24% above the Zacks Consensus estimate. On an average, Altera has come ahead of the Zacks Consensus Estimate by 11.75% in the last four quarters.

 

Altera Corporation is expected to report first quarter results on April 20, 2010.

 

The stock price fell 1.66% in after-hours trading to close at $24.23. In regular hours, the stock fell 0.65% to close at $24.65.

 

Altera is a leading supplier of programmable chips and related products to the communications and other industries. We think Altera is well positioned to capitalize on the strong recovery in the semiconductor industry with its strong design wins.