SAN JOSE -- Programmable logic supplier Xilinx here today slashed its forecast for revenues in the current quarter because of an unexpected drop in customer orders during the first three weeks of June.
The company said it now expects revenues to drop 32% sequentially from $407 million in the prior quarter. At the beginning of June, Xilinx was predicting a 15-to-25% decline in revenues in the fiscal quarter, ending June 30 (see June 4 story).
A falloff in "turns business"--orders that are booked and shipped in the same quarter--occurred in the first three weeks of June, said Xilinx. According to the company, a greater percentage of its revenues have been generated by "turns business" because of customer spending practices in the downturn.
Xilinx said it now expects gross margins to decline to 52% in the first fiscal quarter, which ends June 30, because of the lower-than-expected sales and a mix shift to higher density devices, primarily within the Virtex-E series of field-programmable gate arrays. The company said its high-density Virtex-E devices and recently introduced Virtex-II FPGA products have lower average gross margins than Xilinx's mainstream products.