Oct. 9 (Bloomberg) -- Intersil Corp., a rival of Texas Instruments Inc. in the market for analog chips, sank to a record after its sales forecast missed estimates on weak demand for personal computers.
The shares of Milpitas, California-based Intersil declined 4 percent to $7.02 in New York, the lowest closing price since an initial public offering in 2000. The stock has lost 33 percent this year.
Intersil said that revenue from industrial and infrastructure customers -- its biggest business segment -- slipped to 57 percent of total sales in the third quarter from 59 percent in the previous three months. PC sales decreased to 21 percent of the total, from 25 percent. The company is also losing share to Intel Corp.’s new Ivy Bridge processor, said Rick Schafer, an analyst at Oppenheimer & Co.
“This miss is unlikely to surprise most investors as PC data continues to skew negative and Ivy Bridge share losses mount,” Schafer wrote in a research report today.
Sales for the third quarter dropped about 19 percent to $151 million from the same period a year earlier, Intersil said in a statement today announcing preliminary results. That’s less than the low end of the revenue forecast range of $156 million to $163 million that the company provided in July. Analysts on average had projected sales of $159.9 million, according to data compiled by Bloomberg.
“The industrial and infrastructure segment is generally high gross margin business for the company, and is one of the areas where Intersil has refocused its business,” Chris Caso, an analyst at Susquehanna International Group, wrote in a research report.
“Certainly we cannot ignore the macro environment, but for a company that has invested heavily over the past few years via acquisition, growth has not yet materialized, at least not in a way to offset the macro headwind,” Caso said.
Intersil has announced or completed 6 acquisitions over the past 5 years, according to data compiled by Bloomberg. The largest was Techwell Inc., which Intersil agreed to buy for about $370 million in 2010 to expand its lineup of video chips.
Intersil said it will report earnings on Oct. 24.
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