Fairchild Semiconductor Earnings: Revenue and Profit DROP

Fairchild Semiconductor Corporation (NYSE:FCS) posted a decrease in profit as revenue declined. Fairchild Semiconductor International is focused on developing, manufacturing and selling power analog, power discrete and certain non-power semiconductor solutions to a range of end market customers.

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Fairchild Semiconductor Earnings Cheat Sheet for the Second Quarter

Results: Net income for Fairchild Semiconductor Corporation fell to $11.9 million (9 cents per share) vs. $44.9 million (34 cents per share) a year earlier. This is a decline of 73.5% from the year-earlier quarter.

Revenue: Fell 16.6% to $361.5 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Fairchild Semiconductor Corporation fell short of the mean analyst estimate of 16 cents per share. It fell short of the average revenue estimate of $370.3 million.

Quoting Management: “Gross margin increased nearly three percentage points sequentially due primarily to higher factory loadings and the favorable impact of our insurance recovery related to the flooding in Thailand,” said Mark Frey, Fairchild’s executive vice president and CFO. “R&D and SG&A expenses were $96.2 million which was in line with expectations. Free cash flow was a positive $32.4 million and benefited from working capital improvements and lower capital spending. We increased internal inventory dollars by about five percent sequentially to prepare for the expected ramp in mobile demand.”

Key Stats:

Revenue has fallen for the last four quarters. Revenue declined 14.7% to $352.2 million in the first quarter. The figure fell 14.7% in the fourth quarter of the last fiscal year from the year earlier and dropped 2.7% in the third quarter of the last fiscal year from the year-ago quarter.

The company fell short of estimates last quarter after beating the mark the quarter before with net income of 6 cents versus a mean estimate of net income of 4 cents per share.

Net income has dropped 45.1% year-over-year on average across the last five quarters. Performance was hurt by a 96.3% decline in the first quarter from the year-earlier quarter.

The company’s cost of sales slipped to $243.8 million, a dip of 62.9% from a year ago. Last quarter, cost of sales was 67.4% of revenue versus 62.9% a year earlier.

Looking Forward: Over the past sixty days, the outlook for the company’s performance next quarter has become increasingly unfavorable. The average estimate for the third quarter is 24 cents per share, a drop from 25 cents. The average estimate for the fiscal year is now 74 cents per share, down from 77 cents sixty days ago.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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