TriQuint Moves Up on Guidance

After a strong fourth quarter, the chipmaker predicts 10% revenue growth in 2004.
By K.C. Swanson ,

Updated from Feb. 5

TriQuint

(TQNT)

shares tacked on over 6% a day after the wireless chipmaker beat Wall Street expectations with a fourth quarter profit and topped consensus estimates for sales. It also hoisted its first-quarter sales guidance and predicted 10% revenue growth for all of calendar 2004.

Investors bid up the stock 53 cents to $8.95 in recent trading.

Fourth-quarter sales of $89 million reflect 22.4% growth from last year's levels, reflecting the firm's highest quarterly revenue since the first quarter of 2001. Wall Street analysts were gearing for $86.3 million.

Revenue grew 13% from the third quarter of 2003, helped by strong seasonal demand in the wireless handset and wireless LAN (local area network) markets, and increased revenue from the infrastructure market. TriQuint gets the biggest chunk of sales from the cell phone market, which accounted for 45% of revenue in 2002. (The company hasn't yet given a 2003 breakdown of sales.)

Gross margin increased 270 basis points to 32.5% due to higher volumes of chip production.

Quarterly profit amounted to $8.9 million, or 6 cents a share.

On a pro forma basis earnings per share totaled a penny, better than consensus expectations for a penny per share loss.

As for guidance, TriQuint expects sales in the range of $81 million to $83 million, above its previously forecast range of $77 million to $80 million. Wall Street analysts had predicted sales of $79 million.

In a statement, the company said it upped its forecast due to "continued strong shipments and bookings to date in the first quarter of 2004."

TriQuint's first quarter net loss should range between $1 million and $3 million, though the company did not say what its share count was expected to be in the quarter. Analysts were predicting a per share loss of 3 cents.

For all of 2004, TriQuint issued a prediction for at least 10% sales growth based on continued strength in the wireless phone market, coupled with stability in the optical network market, recovery in the network infrastructure market, and a stable outlook for our defense business. In 2003 sales totaled $312.3 million.

Total annual revenue in 2004 should fall between $340 million and $355 million -- an outlook in line with that of the 18 analysts polled by Thomson Analytics, who predicted $346.2 million in sales for the year.

Also, TriQuint's gross margin in 2004 should improve to a range of 32% to 34%, compared to 27.9% for 2003.

TriQuint said its operating margin should improve from a loss of $74.4 million in 2003 to near breakeven or better for 2004.

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