NEW YORK (TheStreet) -- Shares of Sigma Designs (SIGM) were dropping 8.25% to $7.61 on heavy trading volume late Wednesday afternoon after the company posted strong 2017 fiscal second quarter earnings, but gave a downbeat outlook for the third quarter.

After yesterday's market close, the Milpitas, CA-based semiconductor solutions company said on its earnings call that it sees third-quarter revenue between $62 million and $65 million, the Fly reported.

Analysts are looking for revenue of $67 million for the current period.

For the second quarter, Sigma Designs reported earnings of 7 cents per share, topping analysts' estimates for a penny per share. Revenue rose 5.2% to $61.3 million year-over-year, while Wall Street was forecasting revenue of $61.2 million.

"We had a strong second quarter with revenue up 14% sequentially led by robust demand and early adoption of our Connected SmartTV Platforms business. With gross margins approaching 50% and continued control of our operating expenses, we delivered a healthy net income for the quarter," CEO Thinh Tran said in a statement.

More than 1.03 million of the company's shares changed hands so far today vs. its average 30-day volume of 282,544 shares per day.

Separately, TheStreet Ratings Team has a "Hold" rating with a score of C on the stock.

The primary factors that have impacted the rating are mixed. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, expanding profit margins and notable return on equity.

But the team also finds weaknesses including unimpressive growth in net income, weak operating cash flow and a generally disappointing performance in the stock itself.

Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.

You can view the full analysis from the report here: SIGM

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