Lattice Semiconductor Corporation
) reduced its revenue expectations for the fourth quarter of
2012. Following the news, the company's shares fell 1.86% to
$4.23 after the markets closed on Wednesday.
The chipmaker now expects sales to be down 6%-8% sequentially
versus its previous guidance of plus or minus 2%
Management expects revenue to decline on account of weakness
in the communications market combined with continued softness in
the worldwide distribution channel. The communications market
represented approximately 47% of the company's third quarter
revenue and decreased 7.8% sequentially.
However, the company maintained its gross margin guidance of
53% (+/-2%) and total operating expenses guidance of
approximately $43 million, which includes approximately $5.5
million of restructuring charges.
Recently, the company has taken steps to restructure its sales
and marketing functions, which will reduce operational spending
by approximately $12 million annually. The company expects to
incur total restructuring charges of approximately 6 million, of
which $5.5 million will be recognized in the fourth quarter.
It is imperative that Lattice continues to undertake various
initiatives and develop new products, keeping in mind the
interest of the organization in both the long and short run. We
believe the restructuring action and new products in both
consumer and non-consumer segments will bring in stability and
steady earnings growth in the near future.
Lattice Semiconductor designs, develops and markets high
performance programmable logic devices and related development
system software. The company's third quarter revenue was down
13.2% from the year-ago period to $70.9 million due to lower
programmable logic devices (PLD) revenue. However, revenue for
field programmable gate arrays (FPGA) surged 24.8% year over year
to $26.1 million.
The company is likely to report its third-quarter results on
Currently, Lattice Instruments has a Zacks #3 Rank (Hold). We
note that its rival,
) also carries a Zacks #3 Rank (Hold) while
) carries a Zacks #4 Rank (Sell).
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