"The major factor is industry wide excess inventory," chief executive Mike Bradley told analysts on the company's quarterly conference call. "Inventory levels have risen and triggered broad curtailment in test capacity spending."
The company will take $3.1 million restructuring charge as it tries to pare $20 million from its quarterly overheard. The company shaved 169 jobs during the third quarter and into the fourth.
"The program going forward will be made up of a lot of very detailed changes across the business of semi test and significant changes outside of semi test," said chief financial officer Greg Beecher.
For the quarter ended Oct. 3, Teradyne reported net income of $41.1 million on sales of $457.8 million. Teradyne lost $53.5 million on sales of $329.2 million last year.
The slump came in net orders, which were off 49% sequentially and 16% year-on-year, at $284 million. Gross margins slipped to 41.2% from 43% sequentially and are expected to drop another four points in the January quarter.
Teradyne guided for Q4 sales of $360 million to $380 million and earnings of breakeven to a slight profit.
Bohemia, N.Y. ¾ V.J. Electronix Inc., an x-ray inspection technology and rework systems provider, has opened a new office in Buford, GA. With the new addition, the company now has six U.S. facilities, including those in Bohemia, NY; Dayton, OH; Shirley, MA; Poway, CA; and East Haven, CT.
The Georgia office is located at 1735 Enterprise Dr., Buford, GA 30518.
The results beat a year-ago net loss of $100.1 million, including one-time charges, on sales of $3.5 billion.
For the quarter the company took $34 million in restructuring charges and other non-operational tax adjustments. The cash conversion cycle contracted by two days to 16 days. Inventory turns improved to 10.9 turns from 10.5 sequentially.
Flextronics matched analysts' profits expectations, excluding one-time items, although it fell short of consensus projected revenue of $4.21 billion.
Part of the shortfall owes to inventory reduction at OEMs, analysts say. "There was an inventory build in the communications infrastructure market and that inventory correction is taking place," said analyst Chris Whitmore of Deutsche Bank. Sales from handsets declined about 11% sequentially and offset strong sales for CPU/office equipment and consumer electronics. Revenue from HP increased nearly 50%, DB said in a research note.
Flextronics guided for third-quarter earnings per share before items of 18 to 21 cents on revenue of $4.1 billion to $4.4 billion. For its fiscal fourth quarter, Flextronics expects earnings per share excluding items of 15 to 18 cents on revenue of $3.8 billion to $4.2 billion. Analysts' revenue estimates are higher for each quarter. However, Flextronics, which is taking over Nortel Networks' manufacturing operations, said revenue from that acquisition will not add to overall sales as quickly as once thought.
Chief executive Michael Marks said on a conference call that the December quarter may not be as strong as initially expected but the Mach quarter outlook remains solid. "It's not like we're seeing some big downturn because the March numbers look pretty solid," he said.
Flextronics did suggest that demand has slowed for consumer and communications gear. "This may be a result of some inventory reductions or it could be nothing more than some caution based on oil prices, the election and so on," Marks said. "In either case, we see that as not that big a deal, at least for Flextronics."
CAMBRIDGE, MA, Oct. 26 -- Broadband Internet access is soaring in the U.S., according to the latest data from Forrester Research.
The number of households with Internet access is forecast to grow from 68 million in 2003 to 83.7 million by 2008, a 23% clip. Yet the number of households with broadband will jump 226% during the same timeframe, from 19.5 million to 63.6 million.
By 2008, households with broadband will make up 76% of all wired homes, Forrester says, up from 29% last year.
TEMPE, AZ, Oct. 25 -- EMS company Three-Five Systems has linked its electronic purchase order transaction system to Future Electronics, a major distributor, the firms said today. The move is aimed at improving communication between the companies and shortening order processing time.
The two companies are interfacing via RosettaNet standard Partner Interface Process, a specialized system-to-system XML-based format.
RosettaNet is a non-profit consortium of more than 500 technology organizations working to create, implement, and promote open e-business standards and services.
RosettaNet's PIP also allows for future automation of other higher-level business-to-business processes, such as invoicing and payment.
By extending programming support to the Z8 Encore and eZ80Acclaim flash MCU families, ZiLog devices are now supported by programming equipment common to large volume programming houses, effectively decreasing the time from design win to volume ramp up, the company said in a press statement.
The new ZiLog support software can be downloaded directly to existing BP Microsystems programmers at www.bpmicro.com.
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- Western Digital CEO David Goeckeler Elected Chair of Semiconductor Industry Association