KLA-Tencor Lowers Third-Quarter Guidance

Semiconductor equipment maker KLA-Tencor (KLAC Quote) lowered its third-quarter guidance as business fundamentals for the chip industry have continued to deteriorate.

The company expects revenue for the quarter ending March 31 to come in 8% to 10% below the range of $570 million to $580 million the company provided in January. KLA also reduced its earnings expectation, saying that the bottom line will likely fall below the projection of 58 cents a share the company previously offered.

According to First Call/Thomson Financial, analysts expect the company to earn 51 cents a share in the third quarter, up from 38 cents in the year-ago period. Wall Street is looking for revenue of $557.5 million, up from $413 million a year ago.

"Though the extent and duration of this cyclical industry downturn is unclear, the company will maintain its commitments in research and development to support its key strategic programs," the company said in a press release. "However, we will continue to take the necessary steps to reduce our expense structure in other areas to reflect lower anticipated revenue.''

KLA plans to release its third-quarter results on April 18.