National Semiconductor Cuts 1Q Outlook

Associated Press
08.10.2004

Chipmaker National Semiconductor Corp. on Tuesday lowered its revenue guidance for the first quarter of fiscal 2005, citing decreased short-term orders.

In after-hours trading, the company's stock fell about 9 percent to $14.31. Shares had closed up 8 cents at $15.70 on the New York Stock Exchange before the revised outlook.

National said it now expects revenue for the period to fall 4 percent to 5 percent from fourth-quarter revenue of $571.2 million. Previously, the company had predicted that revenue would range from flat to a 3 percent increase compared with the fourth quarter.

Based on the fourth-quarter results, the company's outlook puts first-quarter revenue at about $548.4 million to $542.6 million.

Analysts surveyed by Thomson First Call predicted that sales would increase to $583 million. During the first quarter of 2004 National Semiconductor posted sales of $424.8 million.

The company said turns orders, which are placed for delivery within the same quarter, fell more severely than expected. National said distributors slowed their order patterns and adjusted inventory levels, which affected turns orders. Also, growth for flat-panel-display products softened and demand from Chinese wireless handset makers was weaker than expected.

National Semiconductor is scheduled to report first-quarter results on Sept. 9.

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