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Xilinx Earnings and Revenue Beat Wall Street Estimates

Xilinx fiscal-second-quarter net income and revenue fell, but both results were stronger than Wall Street had been expecting.
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Xilinx  (XLNX)  reported fiscal-second-quarter net income per share fell 11% on 8% lower revenue, but both results were stronger than Wall Street had been expecting.

For the quarter ended Sept. 26 the San Jose, Calif., chipmaker earned 79 cents a share compared with 89 cents a share in the year-earlier quarter. The latest adjusted earnings were 82 cents a share.

Revenue fell to $766.5 million from $833.4 million.

A survey of analysts by FactSet produced consensus estimates of net income of 72 cents a share, or an adjusted 77 cents, on revenue of $756.7 million.

At last check, Xilinx shares were trading up 2.4% at $114. They closed the regular trading session on Wednesday down 3% at $111.30. In 2020 through the close of the regular session, the stock was up 14%. 

The results reflected a “record quarter in our data-center group and aerospace-and-defense businesses, as well as improvement in our automotive and broadcast end markets,” President and Chief Executive Victor Peng said in a statement.

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“In addition, [radio frequency system-on-chip] sales ramped meaningfully with a tier-1 wireless original equipment manufacturing customer for 5G radio deployment in North America.”

For the fiscal third quarter Xilinx estimates revenue at $750 million to $800 million, bracketing the FactSet consensus estimate of $774.2 million. 

The company sees a fiscal-Q3 GAAP gross margin of 67.5% to 70.5%.

In early October The Wall Street Journal reported that Advanced Micro Devices  (AMD)  was in advanced talks to buy Xilinx in a deal that could be valued at more than $30 billion.

The coronavirus pandemic has sharply boosted demand for personal computers, gaming consoles and other devices that use Xilinx chips, the Journal reported. 

And such a deal would be the latest acquisition in the semiconductor industry, which the Journal said is rapidly consolidating.

A week ago Citigroup analyst Christopher Danely said in a report that he doubted that such a deal would go through, Barron's reported. He said Xilinx management opposes an acquisition.