- Revenue of $81.7 million, a decrease of 2.6% from $83.9 million in 2Q11 and an increase of 6.0% from $77.1 million in 3Q10.
- Gross margin of 58.6%, compared to 60.4% in 2Q11 and 59.1% in 3Q10.
- Net income of $0.11 per diluted share, compared to net income of $0.11 per diluted share in 2Q11 and net income of $0.13 per diluted share in 3Q10. 3Q11 financial results include approximately $1.8 million ($0.01 per diluted share) of restructuring related charges.
Lattice Semiconductor Corporation (
For the third quarter, revenue was $81.7 million, a decrease of 2.6% from the $83.9 million reported in the prior quarter, and an increase of 6.0% from the $77.1 million reported in the same quarter a year ago. FPGA revenue for the third quarter was $26.2 million, a decrease from the $27.9 million reported in the prior quarter, and an increase from the $24.7 million reported in the same quarter a year ago. PLD revenue for the third quarter was $55.5 million, a decrease from the $56.0 million reported in the prior quarter, and an increase from the $52.4 million reported in the same quarter a year ago.
Net income for the third quarter was $13.3 million ($0.11 per diluted share), compared to a prior quarter net income of $13.0 million ($0.11 per diluted share) and net income of $15.4 million ($0.13 per diluted share) reported in the same quarter a year ago. Third quarter 2011 financial results include approximately $1.8 million ($0.01 per diluted share) of restructuring related charges, as compared to approximately $1.4 million ($0.01 per diluted share) of restructuring related charges included in the second quarter 2011 financial results.
Darin G. Billerbeck, President and Chief Executive Officer, said, "Our third quarter results reflect the impact of weakness worldwide, with the European economic crisis and uncertainty slowing telecommunications infrastructure spending. In response to these uncertain conditions, we continue to manage our inventory and work with customers to meet demand fluctuations. We had record quarterly shipments of our mid-range LatticeECP3 FPGA and the consumer end-market was strong for us during the quarter. We continue to focus on the areas that will drive our success, with an emphasis on product, supply chain and operations excellence, and cost controls, as evidenced by our ability to maintain our earnings per share from the previous quarter even as our gross margin was slightly lower. We are confident in our ability to navigate further volatility given our differentiated market position, strong balance sheet, and an R&D roadmap focused on delivering affordable innovation."
Joe Bedewi, Corporate Vice President and Chief Financial Officer, added, "Total operating expenses of $35.6 million were lower than our original guidance of $36.5 million. We incurred approximately $1.8 million in restructuring charges in the quarter. Gross margin for the third quarter decreased sequentially to 58.6%. This was at the low end of our guidance, and was driven by product mix, gold and yield related costs. We generated $26.4 million of cash from operations, ending the quarter with a cash, cash equivalents and short-term marketable securities balance of $267.2 million. During the third quarter, we repurchased 850,770 of the Company's outstanding shares. We have now repurchased approximately 2.5 million shares valued at $14.8 million, under the $20 million stock repurchase program we announced on October 21, 2010."
Third Quarter 2011 Business Highlights:
- Started Shipping Industry-Leading Lattice MachXO2 PLD Family in Small WLCSP Package: Lattice started shipping samples of its MachXO2 PLD family using a 2.5mmx2.5mm 25-ball Wafer Level Chip Scale Package (WLCSP). The MachXO2 devices now combine an extremely small footprint -- until now unprecedented in the PLD market -- with the industry's lowest power and most feature rich low density PLDs. With the industry's most robust PLD functionality, ultra low power and new WLCSP packaging, the MachXO2 devices can now address applications previously not accessible to PLDs.
- Announced LatticeECP3 FPGA family as the First PCI Express 2.0 Compliant Low Cost FPGA at 2.5Gbps: Achieving this significant industry milestone enables cost and power reduction with higher reliability for 2.5Gbps PCIe v2.0 systems for communications, multimedia, server and mobile platforms, and adds to the broad range of design solutions from Lattice and its IP partners that support the widely adopted serial interconnect standard.
- Launched Power & Platform Management Seminars: Following the publication and widespread adoption of its Power 2 You guide to power management, Lattice has launched the worldwide Power 2 You Seminar Series in October 2011. Board Designers can learn to reduce power and platform management costs up to 50%, increase reliability and reduce the risk of board re-spins.
- Expanded Board of Directors with Additions of Veteran Technology Executives: Ms. Robin Abrams has over 30 years of top-level sales, marketing and executive management experience in high-tech companies, both in the U.S. and abroad, including Firefly Mobile, Inc., Palm Computing, Inc. and Apple. Mr. John Bourgoin has more than 35 years of executive management experience in the semiconductor industry at MIPS Technologies, Advanced Micro Devices, Inc., and Silicon Graphics.
Business Outlook - Fourth Quarter 2011:
- Revenue is expected to decline 4% to 9% on a sequential basis.
- Gross margin percentage is expected to be approximately 59% plus or minus 2%.
- Total operating expenses are expected to be approximately $35.6 million, including approximately $1.0 million in restructuring charges.
Investor Conference Call / Webcast Details:
Lattice Semiconductor will review the Company's financial results for the third quarter 2011 and business outlook for the fourth quarter 2011 on Thursday, October 20, 2011 at 6:00 p.m. EDT. The conference call-in number is 1-888-286-6281 with conference identification number 14035088. A live webcast of the conference call will also be available on Lattice's website at www.latticesemi.com. Our financial guidance will be limited to the comments on our public quarterly earnings call and the public business outlook statements contained in this press release.
A replay of the call will be available approximately two hours after the conclusion of the live call through 11:59 p.m. EDT on October 27, 2011, by telephone at 1-404-537-3406. To access the replay, use conference identification number 14035088. A webcast replay will also be available on Lattice's investor relations website at www.latticesemi.com.
Forward-Looking Statements Notice:
The foregoing paragraphs contain forward-looking statements that involve estimates, assumptions, risks and uncertainties. Such forward-looking statements include statements relating to: our business outlook, including those statements under the heading "Business Outlook - Fourth Quarter 2011" relating to expected revenue, gross margin, total operating expenses and projected restructuring charges; our managing inventory and demand fluctuations; our continued focus on product, supply chain and operations; our ability to control costs; our ability to maintain earnings per share; and our ability to navigate further volatility. Other forward-looking statements may be indicated by words such as "will," "could," "should," "would," "expect," "plan," "anticipate," "intend," "forecast," "believe," "estimate," "predict," "propose," "potential," "continue" or the negative of these terms or other comparable terminology. Lattice believes the factors identified below could cause actual results to differ materially from the forward-looking statements.
Estimates of future revenue are inherently uncertain due to, among other things, the high percentage of quarterly "turns" business. In addition, revenue is affected by such factors as global economic conditions, which may affect customer demand, pricing pressures, competitive actions, the demand for our Mature, Mainstream and New products, and in particular our MachXO and LatticeECP3 solutions, the ability to supply products to customers in a timely manner or changes in our distribution relationships. Actual gross margin percentage and operating expenses could vary from the estimates on the basis of, among other things, changes in revenue levels, changes in product pricing and mix, changes in wafer, assembly, test and other costs, including commodity costs, variations in manufacturing yields, the failure to sustain operational improvements, the actual amount of restructuring charges and compensation charges due to stock price changes. Restructuring charges may vary from the estimate on the basis of the timing and scope of the restructuring. Any unanticipated declines in revenue or gross margin, any unanticipated increases in our operating expenses or unanticipated charges, including without limitation, restructuring charges could adversely affect our profitability during the quarter.