LSI Logic Corp. (NYSE: LSI) put its foot in its mouth and trimmed fourth quarter guidance Tuesday, blaming lower demand due to a build-up of inventory in the supply chain.
Shares were up 0.18 to 18.37 Tuesday. On Nov., the company said it was on track to meet fourth quarter estimates.
The company said that in recent weeks, its customers have been trying to whittle down the overload in their inventories, but these steps don't indicate an easing of end-demand.
"We will continue to work closely with our customers to monitor the overall end-market conditions in the coming weeks and months," added CEO Wilfred J. Corrigan in a statement.
LSI Logic now expects that fourth quarter revenue will be up 3-4 percent sequentially from the $728 million reported in the third quarter. Prior guidance called for a 10 percent increase in revenues.
The company also anticipates that fourth quarter earnings will be 34 cents a diluted share. Consensus estimates had been for fourth quarter earnings of 36 cents. Gross margin is expected to be comparable to the 43.3 percent in the third quarter.