Credit: Shutterstock photoChipmaker Xilinx ( XLNX ) initially got a lift from the Bitcoin mining craze in the December quarter as it topped sales and earnings estimates for the period, but couldn't hold on to those gains.
Meanwhile, STMicroelectronics ( STM ) also beat Wall Street's targets for the fourth quarter.
Xilinx late Wednesday reported adjusted earnings per share of 67 cents, up 29% year over year, on sales of $631 million, up 8%, in its fiscal third quarter ended Dec. 30. Analysts had expected 63 cents and $630 million.
"We delivered our ninth consecutive quarter of revenue growth with December-quarter revenues establishing a new record for Xilinx and we achieved our operating-margin target of 30% one quarter ahead of schedule," Xilinx Chief Executive Moshe Gavrielov said in a news release .
Xilinx shares jumped 2% at the opening bell , but then fell sharply into negative ground. At the close, Xilinx was down 5.1% to 60.74 on the stock market today .
Upside in the quarter was driven by about $12 million in Bitcoin-related sales of field-programmable gate arrays, "without which the company might have missed" estimates, Susquehanna Financial Group analyst Christopher Rolland said in a report. Its FPGA chips are being used for cryptocurrency mining in Bitcoin rigs, Rolland said.
Xilinx likely booked over $8 million in Bitcoin-related FPGA sales in the first few weeks of 2018 as well, he said. However, Rolland believes the Bitcoin boost for Xilinx will be temporary.
"We still contend that crypto-related currency is less durable than their other end-markets ... and that this revenue can disappear fully over two quarters," he said. Rolland rates Xilinx stock as neutral, but raised his price target to 70 from 65.
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San Jose, Calif.-based Xilinx received 47% of its revenue from industrial, aerospace and defense applications in the December quarter, 35% from communications and data center, and 18% from broadcast, consumer and automotive. Xilinx includes its cryptocurrency-related sales in its consumer segment.
For the March quarter, Xilinx guided to sales of $650 million, vs. the consensus estimate of $643 million. It did not give an EPS target, but analysts said its implied guidance should top the consensus of 68 cents.
Meanwhile, STMicroelectronics early Thursday reported adjusted earnings per share of 41 cents, up 156% year over year, on sales of $2.47 billion, up 33%, for the fourth quarter. Analysts expected 35 cents and $2.36 billion.
"We continue to see solid demand across product groups and geographies and, in the first quarter, we anticipate a better-than-seasonal trend for Smart Driving and Internet of Things applications, and the unfavorable seasonal dynamics for smartphone applications," ST Chief Executive Carlo Bozotti said in a news release .
Geneva-based ST expects sales to rise 22% year over year to $2.22 billion in the first quarter, slightly below views for $2.23 billion.
ST shares dropped 1.8% to close at 22.91.
Elsewhere in the semiconductor sector, chip-gear maker Lam Research ( LRCX ) got an early bounce from its December-quarter earnings report , but those gains evaporated.
Lam Research stock was up as much as 4.2% in early trading, but by afternoon it reversed and was down 5% to 199.25.
Fremont, Calif.-based Lam delivered better-than-expected December-quarter sales and earnings late Wednesday and gave March-quarter guidance above views.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
