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!

Intersil CEO Discusses Q3 2011 Results - Earnings Call Transcript

However, unlike prior cycles, the industrial and communications infrastructure market softened quickly, almost in concert with the drop of the computing and consumer markets. This unusual behavior contributed to the surprisingly rapid drop in the third quarter.

We reported third quarter revenues of $186.8 million, an 11% decrease from the second quarter, and a 15% decrease from the third quarter of 2010. The combination of seasonal shifts in product mix and lower manufacturing utilization resulted in our gross margin dropping by 120 basis points to 57%.

In reaction to the downturn, Intersil’s management team reacted swiftly to reduce our operating expenses by 7% compared to our third quarter guidance. This prompt response to the downturn significantly reduced the drop in our earnings, and I have every expectation that we will see further reductions in the coming quarter.

During the quarter, we refinanced our long term debt. This reduced our already low interest expense even further, which will improve EPS by a penny in future quarters. However, as Jonathan will detail, there were approximately $8.4 million in expenses associated with the early retirement of our prior debt, which will negatively impact our GAAP net income and EPS for the third quarter.

As a result, we reported net income of $7.2 million, or $0.06 per diluted share. Our non-GAAP net income and EPS for the third quarter was $25.8 million or $0.20 per diluted share. We generated approximately $24.8 million in free cash flow during the third quarter, and as a result our board of directors has authorized a quarterly dividend of $0.12 per share of common stock. During last quarter’s conference call, I introduced a top 10 list of growth drivers that we expect will result in an estimated $700 million of additional annual revenue within five years.

I’m not going to review this entire list every quarter, but you will see this list as a recurring theme in our strategy, and we will occasionally update you on our progress in those key product areas. The power of 10 is a simple but powerful concept, which has resonated with the investment community and helped focus our resources internally as well.

3 of 4

Select the service that is right for you!

COMPARE ALL SERVICES
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 16,943.81 +28.74 0.17%
S&P 500 1,967.57 +2.89 0.15%
NASDAQ 4,415.49 +19.2860 0.44%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto
Advertising Partners

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