Cypress tops raised 4Q estimate

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Cypress Semiconductor Corp. (NYSE: CY) said Tuesday earnings were 32 cents a share, beating First Call's upwardly revised consensus of 30 cents a share on the strength of new product sales.

Shares were down 1/16 to 36 1/2. Investors had already built the stock up after Cypress said it would top analysts expectations for its fourth quarter.

Revenue of $207.9 million was up 12.7 percent from the prior quarter's revenue of $184.5 million and up 42.8 percent from last year's fourth quarter revenue of $145.6 million. For 1999, the company hauled in $705.5 million, up 27.1 percent from 1998's $554.9 million.

Excluding non-recurring charges and benefits, net income was $37.7 million, or EBG -- earnings before goodwill -- of 32 cents per share. That's a 33.3 percent from the prior quarter's diluted EBG of 24 cents a share, and reverses the 1998 fourth quarter loss of 2 cents a share. Net income for the fourth quarter was $47.5 million, or 39 cents a share. Cypress' fourth quarter included a non-recurring pre-tax net benefit of $12.0 million.

Year-over-year revenue growth of 27.1 percent was close to double the growth rate estimated for the semiconductor industry in 1999. Cypress also said it plans to double the current growth rate of 20 percent predicted for 2000.

Net income for the year was $88.8 million, or 79 cents a share, compared with a loss of 50 cents a share in 1998. Excluding a non-recurring pre-tax benefit of $36.2 million and excluding charges of $33.8 million net income for the year was $91.1 million, or 81 cents a a share. First Call was expecting annual earnings of 75 cents a share.

Recent developments for Cypress include plans for a secondary offering, a merger with Galvantech, which specializes in memories for data communications applications, and a distribution agreement with Avnet (NYSE: AVT).

Cypress said it achieved record new product sales, with products such as the QuadPort RAM, geared for the higher bandwidth demands, doing especially well. After ending the quarter with its third consecutive record for bookings at $262.0 million, a 13.2 percent increase from the prior quarter's $231.4 million, Cypress said its decision to expand capacity will come in handy.