News & Analysis
Comment
GREAT-Terry
As system solution approach is a good strategy but be sharp enough to identify ...
nicolas.mokhoff
It is true that analog vendors are closer to specific applications by default so ...
ADI’s Fishman remains bullish despite economic uncertainty
Ismini Scouras
8/22/2012 10:57 AM EDT
Revenue in its third fiscal 2012 quarter fell 10%, to $683 million, but was up 1% sequentially, which was still slightly lower than expected. Diluted earnings per share of $0.56 was at the midpoint of its earlier guidance.
Revenue in its consumer business was down 19%, while the communications segment’s revenue fell 11%. The only segment to post year-over-year gains was automotive, which saw a 12% jump in revenue.
Sequentially, however, communications was the best performer, growing 9% sequentially as the company’s exposure to wireless base stations in North America, Asia and Japan drove the solid results. Automotive was down 3% as European manufacturers reduced orders on macro concerns. And consumer was up 1%, as strength in portable media was offset by weaker sales of digital cameras.
The company expects the industrial, communications and automotive businesses to remain stable in the fourth fiscal quarter.
ADI is bullish about the outlook in the wireless infrastructure portion of its communications business as 4G LTE rolls out, although 3G will remain the dominant technology for at least another two years. Automotive safety applications, such as roll-over control and radar-based collision avoidance systems, are also expected to be a growth area for ADI.
Fourth-quarter guidance shows revenue estimates of between $685 million and $715 million. A large portion of that growth will be derived from a strong product cycle in its consumer business as it grows its content in mobile devices, particularly MEMS microphones. The company has increased backlog to meet seasonal demand, as well as respond to a new product cycle; consequently, inventory increased by 3%, or $8 million, with 121 days of inventory on hand. The company expects to bring inventory levels back down to historical levels of 100 to 110 days by the end of its first fiscal 2013 quarter.
As inventories come down, capacity utilization rates will be in the high 60 percent rage compared with approximately 70 percent in the third quarter. As a result, gross margins are expected to remain flat at 65 percent vs. 65.6 percent.
|
|
|
|
|
daleste
8/22/2012 7:28 PM EDT
Moving from an IC supplier to a systems supplier has been the goal of the semiconductor industry for 20 years. Intel is the most successful at it. Maybe the economy is helping to allow this to happen.
Sign in to Reply
elctrnx_lyf
8/23/2012 3:32 AM EDT
Analog industry is facing many challenging requirements to integrate many different devices into single integrated circuit. In genermql these requirements will be unique for different applications and many times the companies has to collect such many requirements ans design an optimum solution that could be used across many applications.
Sign in to Reply
ismini.scouras
8/23/2012 9:31 AM EDT
No doubt, we’ve seen major digital semiconductor suppliers, like Intel, providing system-levels solutions for years. But a growing number of analog companies, including Maxim and Linear Tech, have recently said that they are pursuing a systems-level strategy to serve multiple end markets with highly integrated solutions instead of standard parts.
Sign in to Reply
nicolas.mokhoff
8/23/2012 11:39 AM EDT
It is true that analog vendors are closer to specific applications by default so they may have the system design understanding for each down cold. It takes a combo analog and digital house like ST Microelectronics to make it all happen, especially as MEMS become part of the equation. Not taking anything away from the TIs of the world but intent is one thing, execution much harder.
Sign in to Reply
GREAT-Terry
8/23/2012 9:22 PM EDT
As system solution approach is a good strategy but be sharp enough to identify the right socket, especially in industrial application, is not easy. The total available market is not as large as consumer market, the entry barrier is relatively higher, the difference in the "right" approach for different customers in the same industry can be very large.... All these makes the chip vendor difficult to cleverly specify what the market really needs and generate a rocking solution! BTW, it is necessary for analog chip vendor to think more about system approach.
Sign in to Reply