Novellus Warns Over Weak Consumer Spending
Chip-equipment company Novellus Systems (NVLS) warned Thursday that third-quarter results would fall below the company's earlier guidance.
CEO Richard Hill said revenue for the September quarter would be $230 million, as opposed to earlier guidance of $250 million. The revenue drop was due to push-outs in orders from two Asian customers, Hill said.
Shipments for the quarter would drop to $245 million from earlier guidance of $260 million. Orders during the quarter were likely to go as low as $200 million to $220 million, when they were projected for up to $250 million, Hill said.
The revenue drop would take an estimated 2 cents off earnings per share, leaving the company at break-even in net income, Hill said. He said Novellus would make 10 cents per share before one-time charges. Analysts estimates as gathered by Thomson Financial/First Call were for $251.14 million in revenue and 10 cents per share in earnings.On the positive side, Hill said his company has seen a slight uptick this quarter in corporate IT spending, the kick-start that the tech industry has desired. Unfortunately, Hill said, a slowdown in consumer spending "has more than offset the IT" pickup. Hill also said semiconductor companies are struggling with a scarcity in capital, and there is a "cutback in capital expenditures by major companies in the industry." The weakness in the consumer front was well-known, as Hewlett-Packard
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