News Article
RFMD revenues pounded due to weakness in entry level handset market
The firm's revenue for the December 2011 quarter was approximately $225 million, 10% less than was forecast by the company
RF Micro Devices, a designer and manufacturer of high-performance radio frequency components and compound semiconductor technologies, has provided a quarterly financial update for its third fiscal quarter, ended December 31, 2011.
In RFMD's Cellular Products Group (CPG), revenue was approximately $179 million, as sales of 2G components to China-based customers for entry-level handsets were below expectations. In RFMD's Multi-Market Products Group (MPG), revenue was approximately $46 million, reflecting broad weakness in MPG's end markets.
The Company noted customer demand softened during the December quarter, with end-of-quarter 2G demand significantly below customer forecasts. RFMD expects gross margin for the December 2011 quarter will decline approximately 9 points sequentially, due to the lower revenue, lower factory utilisation, and inventory reserves.
Sales of RFMD's components for 3G/4G smartphones increased sequentially approximately 16% during the December 2011 quarter.
Bob Bruggeworth, president and CEO of RFMD, said, "RFMD is navigating broadly lower demand in 2G handsets and softness across MPG's markets. Despite this challenging macro environment, RFMD is winning new business with industry-leading products and technologies, and we fully expect to grow in fiscal 2013, supported by market share gains, new product launches, and expanding relationships with both channel partners and customers."
In the March 2012 quarter, RFMD anticipates normal seasonality in the handset industry and in MPG's end markets. The Company will provide additional guidance in its quarterly earnings announcement and corresponding conference call on January 24, 2012.
RFMD executives are scheduled to present at the 14th Annual Needham Growth Conference in New York, NY, on Tuesday, January 10, 2012, at 8:40 a.m. Eastern Time. A live audio webcast of the Needham presentation will be available on RFMD's web site at the following URL: www.rfmd.com (under "Investors").
