Solectron Reports Q3 Income Down 71%
Published: 29 June 2007
by Staff
The company’s sales were $2.99 billion for the quarter, an increase of 3% over the previous quarter, and an increase of 10% year-over-year.
On June 4, Flextronics announced it would acquire Solectron. The merger agreement has been filed with the SEC. The transaction is expected to close in the fourth quarter. In a conference call with analysts last night, Solectron did not provide guidance or details on the pending acquisition.
A rebound in sales to Cisco following its Lean initiative and share gains from Celestica drove the sequential increase, said analyst Carter Shoop of Deutsche Bank. Excluding Cisco, Solectron's sales were off 4% sequentially. Consumer electronics sales dropped 15% sequentially and 6% versus last year.
The operating margin was 1.3%, up 0.l points sequentially. Gross margins fell 0.2 points. Inventory days fell one day to 58 days.
