Freescale Falls After Revenue Forecast Missed Estimates
Freescale Semiconductor Ltd. (FSL), a maker of semiconductor processors, tumbled as much as 14 percent after the company forecast third-quarter revenue that missed analysts’ estimates.
The stock fell 6.4 percent to $9.56 at 9:57 a.m. in New York, after earlier trading as low as $8.79 for the biggest decline since April 20. The Austin, Texas-based company’s stock had declined 19 percent this year through yesterday.
Freescale, which named former Texas Instruments Inc. (TXN) executive Gregg Lowe as chief executive officer last month, is trying to return to profitability after recording losses for the last two years. Lowe, who replaced Rich Beyer last month, will conduct a strategic review of the company’s business lines and expenses in the coming weeks.
“We will complete an analysis of the market potential, our strengths and weaknesses,” he told analysts on a call yesterday. “We will continue to scrutinize expenses that do not impact our ability to grow,” he said.
The company will eliminate its corporate jet and associated flight operations, he said.
Third-quarter revenue will be $955 million to $1.01 billion, according to a company statement yesterday. That compared to an average estimate of $1.05 billion, according to data compiled by Bloomberg.
Advanced Micro Devices Inc. (AMD), the second-biggest maker of processors for personal computers, declined 11 percent to $4.32. The company yesterday predicted its sales would decline as much as 4 percent in the current quarter as demand for PCs is dragged down by a slowing economy.
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