Semiconductor Macro Notes Flashcards
9.16.2105 - MXL guides higher for Q3 and Q4
MaxLinear, Inc. (NYSE:MXL), a provider of integrated, radio-frequency (RF) and mixed-signal integrated circuits for broadband communications, Pay-TV and the connected home, and data center, metro, and long-haul transport network applications, today revised its financial outlook for the third quarter 2015.
MaxLinear currently anticipates revenue for the quarter ending September 30, 2015 to be approximately $95 million, compared to prior guidance of between $90 million and $94 million. MaxLinear also announced that it expects GAAP and non-GAAP gross margin for the third quarter 2015 to be approximately 53 percent and 57 percent, respectively, consistent with prior guidance. GAAP and non-GAAP operating expenses are expected to be approximately $49 million and $31 million, respectively, compared to prior guidance of approximately $50 million and $32 million, respectively.
Management Commentary
“As we have seen strength across our business toward the end of the quarter, we are pleased to raise our revenue outlook for the third quarter. Additionally, stronger-than-anticipated demand has led to improved visibility into the fourth quarter, which now points to roughly flat revenues relative to the third quarter of 2015 rather than potential seasonal declines.”
Reaction to the update was broadly positive as analysts highlighted robust underlying trends exiting the quarter driven by strength in Cable. Analysts were particularly encouraged by management’s commentary that stronger than anticipated demand has led to improved visibility into Q4, pointing to roughly flat q/q revenues rather than potential seasonal declines. This guidance implies Q4 revenue of ~$95M, well above FactSet consensus $89.8M, which should help ease some investor concerns around seasonality and a challenging operator market.
Surveyed notes suggested that MXL continues to benefit from favorable secular trends, including the shift to higher channel count broadband solutions. Additionally, analysts were pleased with faster than anticipated integration of the Entropic acquisition, driving lower operating expense growth.
9.10.15 - KLAC raises FQ1 orders guidance to high end of prior guidance range
KLAC disclosed this morning at an investor conference that the company’s
September quarter orders would likely come in at the high end of guidance of
$450-$650M. Upside has come from 10nm logic and mask inspection related to
10nm that was greater than the company had expected. KLAC still expects its
2H15 orders to be flat to 1H15 orders, consistent with previous guidance, but
believes there is opportunity for some incremental upside in 2H15. Management
commentary indicates that 10nm spend is still expected to ramp in 2016 with
shipments picking up in mid 2016 for YE16 production at customers.
Commenting on the guidance, Cowen analyst Tim Arcuri says the guidance is driven by new 10nm logic/foundry activity and says 2016 sets up better for KLAC.
9.9.15 - FCS updated their Q3 guidance
Fairchild revised its Q3 revenue guidance to $340M versus a prior view of $365M (midpoint). Sales for Q3 are coming in lower
primarily as a result of weaker than expected component sell-through in
July and August from China distributors, notably in the consumer, white good appliances, and industrial end- markets. Management believes that the subsequent inventory correction at distributors should be completed in 2-3 quarters. We should note that Fairchild recognizes revenues to its
international distributors on sell-in (and not sell- through). Q3 revenue guidance was also slightly impacted by continued softness from weak Samsung smartphone sales. Overall, Fairchild continues to see strength in
North America and Europe and has seen better-than-expected direct sales to China OEMs. Additionally, Fairchild announced a new cost restructuring program that is expected to lower opex by $30 to $34 million annually. The new opex restructuring program is expected to be implemented in 4Q15 and be fully reflected in 1Q16
9.8.2015 - MCHP Raises guidance for sales and EPS next quarter
Microchip Technology Incorporated (NASDAQ: MCHP), a leading provider of microcontroller, mixed signal, analog and Flash-IP solutions, today narrowed the range and increased the mid-point of its prior guidance for net sales and earnings per share for its fiscal second quarter of fiscal 2016 ending September 30, 2015. Microchip’s core business is tracking towards our original guidance while Micrel sales for the partial quarter are ahead of our original guidance. Microchip previously provided guidance on August 3, 2015 for consolidated non-GAAP net sales to be between $532 million and $569 million with a mid- point of $550.5 million. Microchip now expects consolidated non-GAAP net sales to be between $545 million and $563 million with a mid-point of $554 million. Microchip now expects non-GAAP earnings per share to be between 60 and 66 cents per share. The original guidance for non-GAAP earning per share was between 58 and 66 cents per share.
“We have completed the repurchase of the 8.6 million shares of Microchip common stock that we issued in the Micrel acquisition. Together with upside in net sales and early expense reductions achieved, we expect Micrel now to be breakeven to our non-GAAP earnings per share for the quarter. We had earlier guided Micrel to be 1.5 cents dilutive to our September quarter results,” said Steve Sanghi, Microchip’s president and CEO.
Mr. Sanghi added, “We have accelerated the pace of integration of Micrel into Microchip systems and now expect to close the Micrel San Jose fab within one year of the acquisition date. Early analysis from our sales and field applications engineers has also identified significant revenue synergy with Micrel products at our customers. We now believe that we will see the full accretion from this acquisition to be reflected in Microchip’s financial results by the second half of fiscal 2017, which is considerably earlier than we previously guided.”
9.21.2015 - Dialog acquires ATML
Dialog agrees to buy ATML for $4.6B, deal expected to be completed by Q1 2016. Price of $10.42 per share represents 43% premium over stock’s last closing price. For each share, $4.65 cash +0.112 of Dialog ADS. This price is 3.5x EV/Sales
Post transaction, ATML shareholders are projected to own ~38% of combined company. Shares of Dialog fell the most in almost 7 years in Frankfurt trading likely due to the high cost of the deal and integration issues.
Chinese continue to desire control of space, evidenced by China Electronics Corp and Tsinghua’s pursuits of ATML and MU. Given ATMLs exposure to some sensitive areas, it was unlikely a Chinese bidder would have received US approval anyways.
The acquisition provides Dialog with diversification from mobility into the Internet of Things (IoT) and away from a concentrated customer base, as its top 5 customers currently represent 87% of sales, with AAPL being the largest. The acquisition of Atmel is expected to provide Dialog with $150mm of in cost synergies. Atmel is a key supplier of microcontrollers and capacitive touch controllers. The company’s prior focus on XSense and mobility had been a drag on profitability and the company is refocusing on its core MCU franchises and cost controls
