SAN FRANCISCO—Cypress Semiconductor Corp. Thursday (Oct. 21) reported third quarter revenue that fell short of the company's sales target and Wall Street expectations due to manufacturing limitations in its SRAM business and slowing order rates in PC end markets and the company's distribution channel.
Cypress (San Jose, Calif.) reported third quarter sales of $231.9 million, up 4 percent from the previous quarter and up 30 percent from the same period of 2009. Cypress reported a net income of $34.4 million, or 18 cents per diluted share, based on generally accepted accounting principles (GAAP), up 75 percent from the previous quarter and compared to a loss of $19.7 million in the year-ago quarter.
On a non-GAAP basis, excluding charges, Cypress reported a net income of $53.4 million, or 28 cents per diluted share, up 11 percent from the previous quarter and up 178 percent compared to the third quarter of 2009.
Consensus analyst expectations called for Cypress to post third quarter revenue of $237 million and non-GAAP earnings per share of 27 cents, according to Yahoo Finance.
"Cypress achieved its sixth quarterly sequential revenue increase, though revenue was slightly below our original guidance," said Cypress President and CEO T.J. Rodgers, in a statement. "Strong sales, combined with our ongoing cost-reduction programs, led to record gross margin, very strong earnings and more than $100 million in cash flow generation."
Rodgers attributed the revenue shortfall to SRAM manufacturing limitations and slowing order rates in PC end markets and Cypress's distribution channel.
Rodgers said Cypress expects its total revenue to decrease sequentially in the fourth quarter due mostly to a softer market for SRAM and legacy products.