Standard Microsystems Corp. (SMSC), Wednesday reported a decline in profit for the third quarter of fiscal 2010, reflecting mainly a provision for taxes. Adjusted earnings, however, came in well ahead of the Street view. The company also provided guidance for the fourth quarter of fiscal 2010.
The Hauppauge, New York-based integrated circuits maker's net income for the third quarter declined to $6.81 million or $0.30 per share from $9.05 million or $0.41 per share in the previous year. Results for the quarter include stock-based compensation of $2.79 million, amortization charges of $1.42 million and depreciation charges of $2.23 million.
On an adjusted basis, net income was $7.68 million or $0.34 per share, compared to $8.74 million or $0.39 per share a year ago. On average, six analysts polled by Thomson Reuters expected the company to report earnings of $0.22 per share for the quarter. Analysts' estimates typically exclude special items.
Total sales and revenues for the quarter increased 4% to $87.23 million from $84.27 million last year. Analysts expected revenues of $84.21 million for the third quarter.
Christine King, president & chief executive officer, said, "Sales grew in all of our served geographies. PC sales were healthy but enterprise spending has yet to rebound. Both our portable and analog ASSP product lines achieved record revenues in the third quarter of fiscal 2010 and our automotive sales more than doubled from the low point of the downturn."
Gross profit was $45.03 million for the quarter, compared to $43.16 million in the year-ago period. The non-GAAP gross margin was 54.9% or 51.6% on a GAAP basis.
Interest income for the quarter declined to $0.16 million from $1.58 million a year ago. For the quarter, the company reported other expenses of $0.33 million, compared to an income of $2.01 million for the comparable quarter last year.
Provision for income taxes for the quarter was $2.39 million, compared to $0.30 million in the previous year.
For the nine-month period, net loss was $8.92 million or $0.40 per share, compared to an income of $22.23 million or $0.99 per share in the same period of the previous year. Total sales and revenues for the period declined to $224.79 million from $274.25 million a year ago.
Looking forward, the company expects non-GAAP earnings in the range of $0.10 to $0.12 per share for the fourth quarter of fiscal 2010. Revenue for the fourth quarter is anticipated to range from $78 to $82 million, in line with seasonality.
Analysts expect the company to report earnings of $0.11 per share on revenues of $77.41 million for the next quarter.
"Though we are moving into our seasonally low period, we are encouraged by the apparent health of the semiconductor supply chain and expect to continue to grow market share as we enter the new calendar year," said King .
SMSC closed Wednesday's regular trading at $23.07, up 0.19 or 0.83%, on a volume of 301K shares on the Nasdaq. In after hours, the stock went down 0.57 or 2.47%, trading at $22.50.
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