National Semiconductor Beats Estimates, but Sees Slowing Revenue

National Semiconductor(NSM Quote) posted second-quarter earnings that topped analysts' expectations by a nickel, despite the impact of inventory corrections in the mobile phone market and slower demand in the PC market, but warned that revenue would likely slow in the third quarter.

The computer chip maker earned $106.7 million, or 56 cents a share, compared with earnings of $70.4 million, or 37 cents a share, in the same period last year. Analysts polled by First Call/Thomson Financial expected second-quarter earnings of 51 cents a share.

Revenue for the quarter rose to $595 million from $513.9 million last year.

The Santa Clara, Calif., company also said it expects a decline of up to 10% in third-quarter sales, compared with sales in the second quarter, partly due to continued inventory adjustments in the distribution channel and seasonal weakness in the PC and peripherals market.

However, the company expects market conditions to improve after the end of the year, with sales for the fiscal year ending May 27, 2001, improving about 10% over 2000.

Shares of National Semiconductor were lately down 4.7%, or 94 cents, to $19.06 in composite trading on the New York Stock Exchange.