Austin-based Silicon Labs' stock slips on third-quarter results [Austin American-Statesman]
(Austin American-Statesman (TX) Via Acquire Media NewsEdge) Oct. 24--Austin's Silicon Laboratories Inc. gave weaker-than-expected guidance Thursday for its fourth quarter -- and investors responded by sending the chipmaker's stock price lower.
The company said weakening demand for global television sales was part of the reason it reduced its revenue guidance for the current quarter to between $140 million to $145 million, about $8.5 million less than analysts were expecting.
Silicon Labs is the world's leading supplier of advanced tuner chips for digital TVs and its broadcast related revenue totaled about $50 million in the latest quarter. But analysts are concerned that Asian demand for new TVs could stall after the Chinese government ended its subsidies for consumer electronics.
While Silicon Labs is the dominant supplier of chips to the largest TV makers, analysts say more consumers may be looking to buy from less well-know brands.
"Consumers in Asia are moving down the name -brand curve," said analyst Cody Acree with Williams Financial Group in Dallas
Silicon Labs stock dropped by $2.28 a share, or 5.5 percent, to close at $29.21 in heavy trading.
Silicon Labs' profit was down from a year ago, which it said was primarily tied to costs associated with its purchase of Energy Micro, a promising Norwegian company that develops low-power microcontroller chips.
Silicon Labs reported a profit of $6.5 million, or 15 cents a share, on revenue of $146.9 million for the quarter ended Sept. 28. That compared with a profit of $10 million, or 24 cents a share, on revenue of $149.5 million for the same quarter last year.
CEO Tyson Tuttle said the company's results hold promise for the future.
"We achieved record revenue in the third quarter for our industry-leading broadcast video products, as well as solid results for our broad-based products," Tuttle said. "The integration of Energy Micro further strengthens our broad-based portfolio and our leadership position in low-energy microcontroller solutions for the 'Internet of Things.' "
The 'Internet of Things' is a chip industry term for the trend of connecting many more non-computing devices -- including home automation systems, automobiles and industrial equipment -- to the Internet for remote monitoring and control.
The company employs about 1,100 people worldwide, with just over half of them in Austin.
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