Thursday, integrated circuit maker Maxim Integrated Products Inc. (MXIM), reported a drop in profit for the first quarter, hit by one-time charges and a write down on assets to be sold, notwithstanding a 14% rise in revenues from last year. Nevertheless, net earnings for the quarter came in ahead of analysts' consensus by a penny. Maxim also provided revenue outlook for the second quarter, in line with analysts' current consensus estimate.
The Sunnyvale, California-based company's net income for the first quarter dropped to $41.95 million or $0.13 per share from $67.57 million or $0.21 per share in the prior-year quarter.
Results for the quarter included a $16.9 million pre-tax net benefit primarily for stock option related settlement & litigation and certain payroll taxes, interest and penalties, $8.3 million pre-tax expense for the write down to fair value of assets to be sold and $16.8 million additional tax provision due to international restructuring. Special expense items reduced earnings by $0.03 per share.
On average, 17 analysts polled by Thomson Reuters expected the company to earn $0.12 per share for the quarter. Analysts' estimates typically exclude one-time charges and gains.
In the previous fourth quarter, Maxim reported a net income that plummeted to $8.1 million or $0.03 per share from $66.05 million or $0.20 per share in the prior-year period.
Net revenue for the recent first quarter rose 14% to $449.25 million from $394.47 million in the prior-year quarter. Street analysts' had a consensus revenue estimate of $438.43 million for the quarter.
For the preceding fourth quarter, Maxim Integrated reported revenues that declined to $394.5 million from $501.27 million in the prior year period.
Operating income for the first quarter was $90.10 million, compared to $93.59 million in the year ago period, while operating expenses were $161.53 million, down from $198.00 million last year.
At September 26, 2009, Maxim's total cash, cash equivalents and short term investments was $937.60 million, while cash flow from operations for the period were $138.52 million.
Maxim's fiscal first quarter bookings increased 10% on a sequential basis and 90 day backlog increased 4% to $288 million.
Tunc Doluca, President and Chief Executive Officer, said, "Maxim had a strong September quarter. Revenue grew double digits for the second consecutive quarter and has held up relatively well year over year during which our industry experienced a severe downturn. Quarter over quarter, we achieved operating leverage with significant improvements in gross and operating margins."
Looking ahead to the second quarter, Maxim expects revenues in the range of $450 million - $465 million with gross margin of 57% - 59%. Operating expenses are expected to be $175 million -$178 million. Analysts currently expect the company to report revenue of $454.81 million for the second quarter.
Maxim also declared a quarterly cash dividend of $0.20 per share, payable on December 4, 2009, to stockholders of record as of the close of business on November 20, 2009.
Amongst others in the sector, Santa Clara, California-base chip maker National Semiconductor Corp. (NSM) on October 9, reported that its first quarter profit fell 63% from last year, as sales dropped and margins deteriorated in a difficult industry environment. However, the company's quarterly earnings came in above analysts' expectations as did its quarterly sales. The company reported net income for the first quarter of $29.8 million or $0.13 per share, compared to $79.6 million or $0.33 per share for the year-ago quarter. Net sales for the quarter dropped 32% to $314.4 million from $465.6 million in the same quarter last year.
MXIM closed Thursday's trading at $17.86, up $0.65 or 3.78%, on the Nasdaq. In after hours, the stock lost $0.46 or 2.58%, trading at $17.40. In the past 52 weeks, the stock trended in a broad range of $10.72 - $19.43, with a three-month average volume of 4.34 million shares.
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