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Integrated Circuit loses ground in first trading day

Integrated Circuit Systems (Nasdaq: ICST) closed off 1, or 8 percent, to 12 Tuesday in its initial public offering.

The timing device maker priced its 12.5 million shares at $13 a piece, well below its original range of $15 to $17.

The company makes mixed-signal integrated circuits (ICs) called silicon timing devices, which emit signals to help electronic systems work in synchronization. The devices are used primarily on PC motherboards, and in digital cameras, and communications devices.

For the fiscal year ended July 3, income was $23.0 million on revenue of $139.1 million, compared to an income of $21.4 million on revenue of $160.6 million in 1998.

The company said risks to its business include its dependence on the PC industry -- a substantial portion of the sales of our products depends largely on sales of PCs and peripherals for PCs. Integrated Circuits sells most of its silicon timing devices to OEM customers including Compaq (NYSE: CPQ), Dell (Nasdaq: DELL), IBM (NYSE: IBM), Intel (Nasdaq: INTC) and Hewlett Packard (NYSE: HWP). The company said that during fiscal 1999, Maxtek Technology represented 12 percent of revenues; otherwise no customer accounts for more than 10 percent of its income.

The company competes with Cypress Semiconductor (NYSE: CY), Symmetricom (Nasdaq: SYMM) and Texas Instruments (NYSE: TXN), according to Hoover's Online.

CS First Boston is the deal's lead underwriter. Co-managers include Robertson Stephens and Lehman Brothers.

• IPO Insider >