National Semiconductor Reports Revenue Drop
National Semiconductor Corp. (Santa Clara, CA) reported revenues of $449.2 million for its fiscal third quarter, 12.5% lower than the same quarter last year and less than 1% above $448.9 million in the fiscal second quarter. Net income for the quarter ended February 27, 2005, was $77.4 million, 16.9% lower than $93.1 million in fiscal third-quarter 2004.
Fiscal third-quarter gross margin was up 2.1% to 52.7% compared to 50.6% gross margin in the fiscal second quarter, achieved despite flat sales, factory utilization rates in the low-60s percentage and a $15 million reduction in inventory. Year-over-year, National’s gross margin for the third quarter was 1.3% higher than fiscal third-quarter 2004 on 13% lower sales.
"Our gross margin focus is paying off," stated National Chairman, President and CEO Brian Halla. "We continue to drive our product mix more and more toward higher-value analog products regardless of the current cautious sales environment."
Fiscal third-quarter bookings worldwide increased 6% sequentially. Year-to-year, bookings declined 35% from fiscal third-quarter 2004. Total company billings exceeded bookings in the third quarter. The firm also raised its fiscal year 2006 estimates from $1.93 billion to $1.98 billion, but think the earnings power in the model can move earnings per share above $1 later this year. Looking ahead to the fiscal fourth quarter, National anticipates revenues to increase 2% to 4% sequentially from the fiscal third quarter. Gross margin is expected to increase to just over 53% in the fiscal fourth quarter.