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Updated from 3:17 p.m. EDT

National Semiconductor

(NSM)

reported stronger-than-expected first-quarter sales and earnings Thursday and told investors to expect the performance to continue.

The chipmaker was rewarded with an 11% spike in its share price, closing at $31.99 -- a 52-week-high.

In a midsession announcement for which trading was halted, the chipmaker said it earned $29.7 million, or 15 cents a share, on revenue of $424.8 million, using standard accounting. Excluding items, the profit would have been 18 cents for the fiscal first quarter of 2004 ended Aug. 24.

A year ago, the company earned a penny a share on sales of $420.6 million.

Cost-cutting, higher average selling prices, better factory utilization and a better product mix drove the strong results, the company said.

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National Semi's decision to focus on its analog business appears to be paying off. Portable power management and wireless product orders showed significant year-to-year bookings growth. Orders for power management products grew 36% year-to-year and 13% sequentially.

In recent trading, National Semi was up $2.17, or 7.5%, to $30.99. The stock was off about 1% before the halt.

The company's results were at the high end of its guidance and better than Wall Street had expected.

Analysts surveyed by Thomson First Call expected the company to earn 13 cents a share on sales of $416.8 million in the first quarter. When it last reported earnings, National Semi said it expected first-quarter sales to range from flat to minus 4% sequentially, but did not give EPS guidance.

The company also said it expected gross margins to be flat in the first quarter, but they actually improved from 44.6% to 47.2% sequentially.

"Our numbers speak for themselves," said Brian L. Halla, National Semi's chairman, president and CEO. "In one year, we've improved National's summer-quarter profits from $1 million to nearly $30 million, and we're continuing to gain share in our key analog markets."

Looking forward, National said it expects second-quarter revenue to grow 4% to 7% sequentially, ranging from about $442 million to $454.5 million. Wall Street was expecting revenue projections of $435.6 million. The company does not supply EPS estimates.

The November quarter began with a 13-week order backlog, its largest backlog in 10 quarters, Halla said.

Although Halla and other execs were upbeat about National's prospects, they carefully avoided making statements about the overall economic environment.