ATI tops 1Q earnings
Shares in the Canadian 3D graphics company slipped in pre-session trading on the Island ECN electronic trading network, off 0.06 to 5.94.
The company reported earnings of $11.8 million or 5 cents per diluted common share, topping First Call estimates by a penny. Total revenue for the quarter was $350.5 million, which fell short of the analyst consensus figure of $388.5 million.
Both earnings and revenue fell from the 25 cents a share earnings on revenues of $413.5 million reported for the same period a year ago.
Gross margins showed sequential improvement, increasing to 26.1 percent from 23.0 percent in the fourth quarter of 2000.
At the same time, ATI officials also cut their outlook for the second quarter, due to the slump affecting the entire PC sector. The company said that revenue is not expected to exceed $300 million, with earning coming in around pro forma even. The revised numbers are well below First Call estimates, which have earnings pegged at 6 cents a share.
According to company officials, a general softening of demand and higher than usual inventories in the PC market have created an environment of price-competitiveness and volume uncertainty.
Company officials said they are adopting a conservative approach to earnings and revenue estimates over the next two quarters but remain confident about the potential for continued growth in new and developing markets.