Linear Facing Executive Changes and Financial Challenges
Linear Technology Corp. announced that revenue for its quarterly period ended December 31, was $267.9 million, an increase of 1% over revenue of $265.1 million for the second quarter of the previous fiscal year. GAAP net income for the second quarter of fiscal 2007 was $105 million, or $0.34 diluted earnings per share, and was similar to GAAP net income of $103.3 million or $0.33 diluted earnings per share reported in the second quarter of the previous fiscal year.
Linear CEO Lothar Maier commented, "We are seeing an overall reduction in our inventories at our end customers, which coupled with some general market weakness, has resulted in a decrease in bookings, sales and profits for the December quarter. The upcoming March quarter is a challenge to accurately forecast. Visibility continues to be low and customers remain guarded in their forecasting and inventory management. The March quarter has historically been strong for Linear due to seasonal strength in industrial markets. However, with inventory reductions expected to continue and low market visibility, this year we expect will be an exception. It is likely that improvements in Europe and the USA may be offset by slowness in Asia, particularly in consumer related markets. Consequently, we currently expect revenue to be down 4% to 7% with profits slightly more impacted primarily due to an increase in the tax rate. However, any increase in confidence in the overall business environment would positively impact this outlook."
The flattened economic outlook was accompanied by an announcement that David Bell, the company’s President, has resigned effective January 16, to pursue personal interests and spend more time with his family. With Bell’s departure, the company is eliminating the position of president. Lothar Maier will assume the responsibilities previously handled by Bell.
Maier commented, "Dave Bell has been with Linear Technology for 12 years and has been a key contributor to its success. He helped grow and set the strategic direction for the Power business as general manager, and for the past three years as president, he has been instrumental in setting the company’s product strategy and growing our worldwide design and sales organizations. We wish Dave the best of luck in his future endeavors."