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Spansion Posts Profit In Q4; Q1 Outlook Disappoints; Shares Fall

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Flash memory chips maker Spansion Inc. (CODE: Quote) Tuesday reported a profit for the fourth quarter, compared to a loss last year, aided by lower costs and the absence of some charges. However, the stock fell nearly 9 percent in afterhours trading, as the company issued first-quarter profit forecast well below analysts' expectations.

Net income for the quarter was $6.9 million or $0.11 per share, compared to a net loss of $74.4 million or $1.25 per share for the year-ago quarter.

Excluding items, earnings were $0.34 per share, while it stood at a loss per share of $0.68 last year.

On average, six analysts polled by Thomson Reuters expected earnings of $0.36 per share for the quarter. Analysts' estimates typically exclude special items.

Net sales rose to $224.0 million from the previous year's $220.02 million. Analysts expected revenues of $234.40 million for the quarter.

Gross margin was 32.1 percent compared to 1 percent last year. Cost of sales declined to $152.05 million from $217.81 million in the prior year. Further, the prior year had restructuring charges of $12.3 million. Looking ahead to the first quarter, the company expects to report between a loss of $0.05 per share and a profit of $0.06 per share. Net sales are estimated to be in the range of $180 million to $205 million.

Analysts currently expect the company to earn $0.27 per share on revenue of $225.84 million for the first quarter.

CODE settled up 0.7 percent at $13.17 on Tuesday, but declined almost 9 percent in the extended trade to $11.99.

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by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

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After recovering from an initial move to the downside, stocks have shown a lack of direction over the course of the trading day on Tuesday. The choppy trading comes on the heels of the notable pullback seen in the previous session. With lawmakers failing to address corporate tax reform before adjourning for the campaign season, the Treasury Department announced Monday that it is taking targeted action to reduce the tax benefits of corporate tax inversions. Eurozone business activity in September expanded at the slowest pace seen so far this year, adding pressure on the European Central Bank to provide more measures to stimulate the region. The composite output index of the purchasing managers' survey fell to a nine-month low of 52.3 in September from 52.5 in August, preliminary data from Markit Economics showed Tuesday.
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