Cypress Semi tops 2Q estimates

Cypress Semiconductor Corp. (NYSE:CY) reported Tuesday that earnings for its second quarter were 54 cents a share, above First Call Corp.'s consensus estimate of 47 cents a share.

Revenue was $300.8 million, up 13.8 percent from the prior quarter's revenue of $264.2 million and up 76.1 percent from 1999 second quarter revenue.

Shares closed at 55 1/2 Monday. The stock has been jagged lately, though Cypress also topped estimates in its first quarter.

Net income, excluding restructuring credits, transaction costs and goodwill amortization from acquisitions, for the second quarter was $72.7 million, resulting in diluted earnings per share before goodwill (EBG) of 54 cents a share. That's up 35 percent from the EBG of 40 cents a share reported last quarter and up 315 percent from the EBG of 13 cents a share reported in the second quarter of 1999.

The company said it achieved its objective for the quarter -- to grow Cypress faster than double that of the semiconductor industry at large. Growth was over 70 percent for the first half of 2000. The company has a six-month backlog of $481 million, more than double the year-ago figure. Growth in communications, specifically wide area network (WAN), wireless infrastructure and wireless handsets, continues to be a growth catalyst.

The company had gross margins of 55 percent, the best the company has seen since the third quarter of 1991. Gross margins were up 11 percentage points from the year-ago figure, due to on-schedule capacity, revenue increases and a 26 percent jump in average selling price (ASP). The biggest increase in ASP occurred in the datacom group, where year-on-year prices rose by $2 to over $10. SRAM prices were also up, due to a shift from commodity SRAMs to those specialized for the telecom and datacom markets.

The company said that with record bookings of $408.1 million in the second quarter, a book-to-bill of 1.36, and continued favorable impact from new product initiatives, it expects to set new records next quarter.