Altera Backs Guidance, Boosts Buyback

The chipmaker announces a new credit facility that will allow it to increase share buybacks.
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SAN FRANCISCO --

Altera

(ALTR) - Get Report

reaffirmed its forecast for the third quarter and announced a new credit facility that will allow it to boost share buybacks.

In its midquarter update Wednesday, Altera said sales of new products are "showing growth" compared with the similar period in the prior quarter.

The San Jose, Calif., maker of programmable chips said revenue in the current quarter will be flat to up 3% sequentially, in line with its previously issued guidance. That suggests a range of $319.7 million to $329.3 million.

Analysts polled by Thomson Financial expect Altera to report revenue of $324.9 million with EPS of 20 cents for the third quarter.

Altera did not provide an EPS estimate. While Altera has projected that its third-quarter gross margin would range between 64% and 65%, the company did not mention margins in its midquarter update Wednesday.

Shares of Altera were up 6 cents at $24.59 in extended trading Wednesday.

In a separate announcement Wednesday, Altera said it would repurchase up to $1.5 billion worth of shares between now and the first half of 2008, boosting its existing repurchase program from the current $1 billion target.

Altera had indicated its plans for such a move in July, assuming it was able to negotiate a $750 million credit facility. Altera also said that it has obtained a five-year $750 million unsecured credit facility, of which $500 million will be used for buybacks.