Conexant Systems (CNXT) - Get Report reported earnings results for the first quarter of its fiscal 2002, putting together $229.5 million in revenue to beat the Street's estimates of a $219.7 million finish.

The chipmaker fell 80 cents a share into the red for the quarter, but excluding special charges and amortization of intangible assets it turned in a slimmer pro forma loss of 42 cents a share, to beat analyst consensus estimates of 44, as reported by

Despite its deep losses, the first quarter represented a 14% improvement over the fourth quarter's $201 million in revenue and shows that a year after the company posted $410 million in revenue to end 2000, that the worst of the chip market may be behind Conexant.

The chipmaker dropped 1% in Wednesday trading to finish at $12.58.

Conexant issued an earnings surprise back in December, increasing its first-quarter revenue guidance from a sequential 5% to 7% increase to as much as 10% revenue growth. CEO Dwight Decker insisted that Conexant's backlog at the time indicated that the January quarter wouldn't see its normal postholiday sales depression but could instead exhibit further revenue increases.

On the same day in December, Conexant, a 1999 spinoff of

Rockwell International

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, announced the decision to spin off its wireless operations to create a separate entity with merger partner

Alpha Industries



The new company, with an estimated market cap of $3 billion, will attack the RF component industry for mobile phones and infrastructure equipment with a complementary set of customers that represents nearly all of the top players in both phones and base stations.

Conexant announced its intentions to spin off its chip businesses that cater to the wireless and Internet infrastructure markets more than a year ago, with the plan to focus Conexant on broadband chips. Wireless sales made up 32% of Conexant's revenue in the fourth quarter, and the prospect of results without the group kicked Conexant's stock into a 17% decline over the month following the announcement. The stock had soared 111% from Oct. 1 to the Dec. 17 unveiling of the spinoff.