PMC-Sierra tops 2Q estimates, falls in afterhours
Shares of PMC-Sierra (Nasdaq: PMCS) slid in afterhours trading following the company's report of second quarter earnings ahead of expectations.
PMC-Sierra traded at 217 7/16 in Thursday's afterhours activity on the Island electronic communications network. The stock had run up 20 7/8 to 228 15/16 during the regular session.
The maker of chips for network equipment reported second quarter earnings of $39 million, or 23 cents per share, not including goodwill writedowns and one-time events. First Call's survey of 25 analysts predicted a profit of 19 cents per share.
Including amortization, acquisition-related charges and stock sales, PMC-Sierra earned $49.9 million, or 30 cents per share.
Second quarter revenue increased to $134.1 million, a 30 percent gain sequentially and 124 percent improvement year-over-year. The company credited its sales growth to the growing deployment of broadband networks.
PMC-Sierra's business gains gave it the leverage to acquire companies, said Bob Bailey, chairman and CEO. PMC-Sierra on Wednesday announced a deal to acquire Quantum Effect Devices (Nasdaq: QEDI) for stock valued at $2.3 billion at the time.
Other companies reporting quarterly results:
The manufacturer of storage drives and media for PCs reported second net income of $22.6 million, or 9 cents per share, excluding $15.3 million related to a decrease in the valuation allowance for deferred taxes, and $2.5 million from the reversal of previously recorded restructuring costs. Including those items, Iomega earned $40.4 million, or 15 cents per share.
First Call's survey of two analysts predicted a profit of 6 cents per share for the quarter ended June 25.
Second quarter revenue of $303.6 million was down from $348.8 million a year earlier and $344.9 million in the first quarter.
Profit margins rose for all the company's product lines. Profits from the company's largest product family, Zip, rose 112 percent year-over-year, despite a decline in revenue. Iomega sold higher unit sales of higher margin 250MB drives, as well as lower manufacturing and operating costs.>