June Swoon: Benchmark’s Sales Drop 9.8%
Revenues were well below Wall Street estimates of $727 million.
The company recorded income of $29 million excluding restructuring charges, integration costs, amortization of intangibles and stock-based compensation costs.Benchmark officials guided for revenues of $650 million to $690 million for the third quarter.
Cash from operations was $2 million for the quarter, suggesting that free cash flow was roughly a loss of $10 million, said Sherri Scribner of Deutsche Bank Equity Research. GAAP operating margin for the second quarter was 3.4%. Days sales outstanding were 62 days. Inventory turns were 6.5 times.
The company blamed slower ramp of new products and more rapidly declining mature programs. Also said soft macro environment is hurting them. Chief executive Cary T. Fu said, "Operationally our execution was solid during the second quarter, although revenues were impacted by maturing programs declining at a more rapid pace than our new programs ramped, and by the impact of a soft macro environment. We believe this is a near-term challenge and that we are well positioned for growth, given the number of new programs that we have won."
Benchmark said it would increase its share buyback by $100 million following completion of a prior $125 million buyback in mid-July.
