Silicon Motion boosts 1Q revenue estimate, but has more obsolete inventory than expected
By APThursday, April 15, 2010
Silicon Motion boosts 1Q revenue estimate
NEW YORK — Chip designer Silicon Motion Technology Corp. boosted its revenue forecast for the first quarter Thursday.
But the company also said that it has a bigger reserve of obsolete inventory than it thought, which forced it to cut the gross margin that it reported for the fourth quarter of 2009.
The Taiwan-based company now expects to report that revenue jumped 15 percent to 16 percent in the January-March period from the quarter before, which would mean revenue of roughly $26 million.
It had previously forecast a range of down 5 percent to up 5 percent. Analysts surveyed by Thomson Reuters were expecting $22.6 million.
However, Silicon Motion said that because of changes in the market, it likely won’t be able to sell a bigger chunk of its parts inventory than it previously estimated.
Given the new estimate, the company said its fourth-quarter gross margin excluding stock-based compensation was about 27 percent or 28 percent as a percentage of revenue. It had originally reported a gross margin of 42.2 percent.
The company said it will report full first-quarter results in either the last week of April or first week of May.
