) reported adjusted earnings per share (EPS) of 38 cents in the
third quarter of fiscal 2013, inching past the Zacks Consensus
Estimate by a penny. However, quarterly earnings failed to
surpass the year-ago earnings of 47 cents a share.
The company generated total revenue of $509.8 million, slightly
down from $511.1 million in the year-ago quarter but better than
the management's guidance of down 1.0%-5.0%. The overall decline
was due to weaker-than-anticipated sales from Broadcast, Consumer
& Automotive end market and Communications & Data Center
end market, offset somewhat by better-than-expected sales from
Industrial and Aerospace and Defense end markets.
Year over year, North America remained flat, Asia-Pacific fell
3.0%, while Europe and Japan grew 1.0% and 5.0%, respectively.
New product sales increased 79.0% year over year, driven by
higher sales of Kintex-7 and Virtex-6 FPGAs. The company reported
that its 28 nanometer families gained much traction during the
quarter. But the company generated soft revenues from Mainstream
and Base products.
Gross margin increased to 66.6% from 65.8% in the year-ago
quarter, primarily attributable to continued focus on yield
improvement and cost reduction and favorable customer mix.
Operating margin decreased to 23.7% from 26.8% in the year-ago
quarter due to higher research and development expenses.
Balance Sheet & Cash Flow
During the quarter, Xilinx generated $122.6 million of cash from
operations and incurred $8.1 million in capital expenditure.
Xilinx paid $57.3 million in cash dividends. Xilinx ended the
quarter with cash, equivalents and short-term investments of $1.7
billion, flat sequentially.
Xilinx stated that the backlog entering into the fourth quarter
was up sequentially. The company also expects revenues from all
the end markets and 28-nanometer products to increase
sequentially. Consequently, Xilinx expects sales to be up 2% to
6% sequentially in the fourth quarter of fiscal 2013 with support
from higher revenues from all geographic regions.
Gross margin is forecasted around 66%. Operating expenses in the
March quarter are expected to be approximately $208.0 million,
including approximately $2.0 million of amortization of
acquisition-related intangibles. Other income and expense is
expected to be $7 million. Fully diluted share count is expected
to be approximately 274 million. Effective tax rate is expected
to be approximately 13 - 14%.
Xilinx's third quarter results were decent with bottom line
beating the Zacks Consensus Estimate. Both revenue and EPS came
below the year-ago level. However, the fourth quarter guidance
was encouraging, which reflected some recovery in the
semiconductor market on the back of expected higher spending.
The company's transition into 28nm nodes is turning out to be
positive and there is possibility for Xilinx to outperform the
market going forward. But stiff competition from
), gloomy semiconductor outlook for 2012 predicted by IT research
firm Gartner Inc. and dwindling PC (significant consumer for
semiconductor chips) market keeps us concerned for the near term.
Currently, Xilinx has a Zacks Rank #3 (Hold). We would like to
recommend other technology stocks which are really doing well.
You can consider
), which has a Zacks Rank #1 (Strong Buy) and
), which has a Zacks Rank #2 (Buy).
ALTERA CORP (ALTR): Free Stock Analysis
ATMEL CORP (ATML): Free Stock Analysis Report
OMNIVISION TECH (OVTI): Free Stock Analysis
XILINX INC (XLNX): Free Stock Analysis Report
To read this article on Zacks.com click here.