Microcontroller and touch solutions provider Atmel Corp. (ATML), Monday reported a loss for the fourth quarter that widened from the previous year, reflecting lower margins, higher operating expenses, and an asset impairment charge that more than offset a 3% increase in revenues. The company, however, posted an adjusted profit for the quarter that surged from last year.
The San Jose, California-based company's net loss for the fourth quarter was $76.94 million or $0.17 per share, compared to $24.35 million or $0.05 per share in the previous year.
Results for the quarter include stock-based compensation expense of $10.68 million, acquisition-related charges of $3.60 million and asset impairment charges of $79.84 million.
Prior-year results include stock-based compensation of $9.05 million, acquisition-related charges of $6.50 million, restructuring charges of $8.11 million, pension benefit of $4.27 million and distributor bad debt recovery of $11.72 million.
On an adjusted basis, net income was $17.64 million or $0.04 per share, compared to $4.77 million or $0.01 per share in prior-year quarter.
On average, 8 analysts polled by Thomson Reuters expected the company to report breakeven per share for the quarter. Analysts' estimates typically exclude special items.
Net revenues for the quarter rose 3% to $343.58 million from $334.61 million last year. Analysts expected revenue of $338.03 million for the quarter.
In the preceding third quarter, the company reported a net loss that widened from the previous year quarter, due mainly to a 21% revenue decline. Third-quarter net loss was $17.5 million or $0.04 per share, compared to net loss of $4.7 million or $0.01 per share last year. Excluding charges, net loss was $4.0 million or $0.01 per share, compared to net profit of $42.6 million or $0.09 per share last year. Revenues were $317.7 million, compared to $400.0 million last year.
Gross profit, as a percent of revenue, was 37.0% for the fourth quarter, compared to 39.7% in the year-ago quarter.
Steve Laub, Atmel's president and chief executive officer, said, "We are pleased to have delivered revenue growth and gross profit expansion that exceeded the upper end of our guidance range this quarter, as demand strengthened and factory utilizations improved."
"Microcontroller sales of 8- and 32-bit products, as well as our capacitive touch solutions, grew strongly as we continued to outperform the market. Based on our solid design win momentum and booking activity we are excited about the outlook for 2010, particularly for our microcontroller and touch products," Laub added.
Total operating expenses increased to $415.34 million from $352.85 million a year ago. Cost of revenues increased to $216.54 million from $201.66 million in the comparable quarter last year.
Income tax provision totaled $4.2 million for the fourth quarter, compared to $3.5 million last year.
In the fourth quarter of 2009, the company recorded an out-of-period expense of $4.8 million for tax reserves related to withholding tax on deemed dividends associated with certain foreign intercompany loans.
Among the peers, Chandler, Arizona-based semiconductor products maker Microchip Technology Inc. (MCHP), Wednesday reported a 4% decline in profit for the third quarter from last year, which included a higher income tax benefit. Adjusted earnings for the quarter, however, surged 65% from last year. GAAP net income for the third quarter was $69.40 million or $0.37 per share, down from $72.36 million or $0.39 per share in the prior-year quarter. Non-GAAP net income for the quarter increased to $70.1 million or $0.38 per share from $41.2 million or $0.23 per share in the year-ago quarter. Net revenue for the third quarter surged 30.1% to $250.10 million from $192.17 million in the same period last year.
Another peer, Milpitas, California-based storage systems and chip maker LSI Corp. (LSI), previously reported a swing to fourth-quarter profit on higher revenues and the absence of a $541 million impairment charge recorded last year. Net income was $64.81 million or $0.10 per share, compared to a net loss of $606.35 million or $0.94 per share a year ago. On a non-GAAP basis, fourth-quarter net income soared to $123.92 million or $0.18 per share from $41.29 million or $0.06 per share in the fourth quarter of 2008. Revenues increased 5% to $637.80 million from $609.96 million in the prior year quarter.
Atmel's fiscal year 2009 net loss widened to $103.17 million or $0.23 per share from $27.21 million or $0.06 per share in the previous year. Adjusted earnings were $33.1 million or $0.07 per share, compared to $78.0 million or $0.17 per share a year ago. Yearly revenues were $1.22 billion, down 22% from $1.57 billion in 2008.
Analysts estimated a loss of $0.06 per share, on revenues of $1.21 billion for the full year.
ATML closed Monday's regular trading at $4.80, down 0.01 or 0.21%, on a volume of 4.78 million shares on the Nasdaq. In the past 52-week period, the stock traded in a range of $3.00 to $5.40, on a 3-month average volume of 4.90 million shares.
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