This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Demand Lifts LSI Logic

Updated from 4:42 p.m. EDT

LSI Logic (LSI) boosted first-quarter profit as the chipmaker reported its first financial results since announcing a new corporate focus.

Sales for the three months ended March 31 increased 6% year over year to $476 million, just slightly below the midpoint of the company's guidance.

Sales were down 6% sequentially, in keeping with the seasonal slowdown described by the company as the toughest quarter of the year.

Analysts were looking for $481 million in revenue.

LSI earned $19 million, or 5 cents a share, compared with the $5 million, penny-a-share profit the company posted a year ago.

Excluding special stock-based compensation expenses and certain acquisition-related charges, LSI earned 11 cents a share, in line with its guidance and analysts' expectations.

CEO Abhi Talwalkar said that strong demand for LSI's storage chips and systems helped offset the seasonal sales decline.

Revenue from storage systems jumped 22% year over year to $178 million, the second-highest amount in company history. Overall semiconductor sales dipped 2% year over year, to $298 million, due to a slowdown in the video-game industry.

In March, LSI announced that it would focus exclusively on the storage and consumer markets .

Talwalkar stressed that LSI remained fully committed to the consumer market despite the recent news that PortalPlayer's (PLAY) chip will not be used in Apple Computer's (AAPL) next flash-based iPod. LSI provides the silicon component of Portal Player's iPod chip.

He said the company was still assessing the impact of the PortalPlayer news, noting that the "dust has not completely settled." While the news would not affect financials in the current quarter, Talwalkar said the economic impact could be as much as $40 million in revenue in the second half of the year.

As for LSI's other consumer businesses, Talwalkar said the company expected strong demand for recordable DVD players that use LSI chips, with falling prices expected to spur consumer demand throughout 2006.

Meanwhile, increasing corporate IT spending in the second half of the year, coupled with industrywide technology transitions, should help LSI's storage sales.

"The fundamental near-term and long-term markets that are demand-drivers for our business remain strong," said Talwalkar.

LSI projected revenue in the current quarter of $470 million and $500 million, with EPS between 11 cents and 13 cents, excluding stock compensation and other special expenses.

On that basis, analysts polled by Thomson First Call were expecting the company to earn 12 cents a share on revenue of $496 million.

Shares of LSI were up 13 cents at $10.20 in extended trading, after closing the regular session off 2 cents.

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 18,053.71 +23.50 0.13%
S&P 500 2,088.77 +6.89 0.33%
NASDAQ 4,806.8590 +33.3870 0.70%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs