SigmaTel Loss Narrows

SigmaTel's(SGTL Quote) revenue tumbled 33% in the first quarter, as the chipmaker reported another quarter of red ink.

But the mediocre financial performance was still better than Wall Street expectations, as was its guidance, sending its shares up in extended trading.

SigmaTel shares were recently up 11 cents, or 2.9%, to $3.95 after hours.

Austin, Texas-based SigmaTel lost $18.1 million, or 51 cents a share, in the three months ended March 31. A year ago, SigmaTel lost $24.7 million, or 69 cents a share.

Excluding stock compensation expenses, as well as charges related to amortization of intangible assets from acquisitions and lease abandonment, SigmaTel said it lost $14.5 million, or 41 cents a share.

Analysts had expected SigmaTel to lose 48 cents a share excluding items.

SigmaTel's sales of $22 million were at the high end of its guidance, and ahead of analyst estimates, which called for $19.6 million in sales.

At this time last year, SigmaTel had $33 million in sales. Two years ago, the chipmaker had $99 million in sales.

SigmaTel has fallen upon hard times as increased competition has eroded its market share and driven down prices for its chips.

In February, SigmaTel said it would refocus its business around three main markets: portable media players, printers and television audio. The company said it would cut $5 million to $7 million in quarterly operating expenses by restructuring the business and shrinking its headcount, with the benefits expected to kick in later in 2007.