SAN FRANCISCOCypress Semiconductor Corp. posted a GAAP net loss of $90.7 million on revenue of $139.3 million in the first quarter as gross margin fell and factory utilization hit an all-time low of 34 percent, the company said Thursday (April 16).
In a statement, Cypress President and CEO T.J. Rodgers said the company believes that the first quarter was the bottom of the trough for revenue and gross margins. Cypress's consolidated gross margin, based on generally accepted accounting principles (GAAP), was 24.4 percent in the first quarter, the company reported.
"We expect gross margin to increase significantly over the next two quarters as we ramp production to meet increased demand and continue to reduce costs," Rodgers said. "Pricing continues to be fairly stable."
First quarter revenue declined 15.6 percent from the prior quarter and 17.3 percent from the same period of 2008, Cypress (San Jose, Calif.) said. The comparison for the year-ago period excludes revenue from SunPower Corp., the Cypress subsidiary spun out last year, the company said.
Revenue exceeded the high end of Cypress guidance due to better-than-expected results across all divisions and channels as the quarter progressed, Cypress said. In January Cypress said it expected first quarter revenue to be between $115 million and $130 million.
An average of analyst estimates for Cypress's first quarter revenue came in at $123.4 million, according to Yahoo Finance.
The first quarter GAAP net loss of $90.7 million, which equates to 67 cents per diluted share, declined sequentially from $414.2 million, or $2.88 per share in the fourth quarter of 2008, Cypress said. The GAAP net loss was three times greater than the company's loss of $30 million, of 15 cents per diluted share, in the first quarter of 2008, Cypress said.
On a non-GAAP basis, excluding special charges,
Cypress posted a net loss of $29.5 million, or 22 cents per share, the company said. The non-GAAP loss widened from $11.1 million, or 8 cents per diluted share, in the fourth quarter of 2008. For the first quarter of 2008, Cypress posted a non-GAAP net income of $1.6 million, or 1 cent per share.
Rodgers said Cypress's semiconductor book-to-bill ended the first quarter at 1.12, with all divisions above unity.
"Ordering patterns began to stabilize in early Q1 and we entered the second quarter 62 percent booked," Rodgers said. "Customers are beginning to place backlog orders and to restock depleted inventory levels."
On a conference call to discuss the first quarter results, Cypress guided for second quarter revenue to be between $145 million and $153 million, above Wall Street consensus of about $129 million. The company said it expects a second quarter net loss of 8 to 12 cents per share, also better than analysts expected.