Intersil Shares Up 4% As Q1 Results Top Estimates, Rosy Outlook

(RTTNews) - Semiconductor maker Intersil Corp. (ISIL) reported Wednesday a profit for the first quarter that surged from last year, reflecting significantly improved operating margins and revenue growth. Both adjusted earnings per share and quarterly revenues topped analysts' expectations. The company's stock gained nearly four percent after it provided earnings outlook for the second quarter, above Street view.

"We are seeing the changes we've made translate into stability in our revenue, expansion of gross margin and improvement in profitability, all key goals we've set for 2014," President and CEO Necip Sayiner said in a statement.

The Milpitas, California-based company reported net income of $10.01 million or $0.08 per share for the first quarter, higher than $2.52 million or $0.02 per share in the prior-year quarter.

Excluding special items, adjusted net income for the quarter was $22.15 million or $0.17 per share, compared to $7.19 million or $0.06 per share in the year-ago quarter.

On average, 10 analysts polled by Thomson Reuters expected the company to report earnings of $0.14 per share for the quarter. Analysts' estimate typically exclude special items.

Net revenues for the quarter increased 6 percent to $140.06 million from $131.72 million in the same quarter last year, and topped eleven Wall Street analysts' consensus estimate of $136.70 million.

Intersil's industrial and infrastructure revenue grew 13 percent to $87.4 million from last year, due to growth in automotive, industrial power and aerospace. Meanwhile, personal computing revenue edged down to $29.7 million from $30.9 million, and consumer revenue also edged down to $23.0 million from $23.3 million in the year-ago quarter.

Operating margin for the quarter expanded 25.3 percentage points to 10.6 percent from last year, as gross margin improved 250 basis points and significantly lower operating expenses.

Looking ahead to the second quarter, the company expects adjusted earnings in a range of $0.17 to $0.19 per share, on projected revenues between $144 million and $150 million.

Analyst are currently looking for earnings of $0.16 per share, on quarterly revenues of $144.01 million for the quarter.

"With a more robust new product pipeline and clearer visibility into growth opportunities in 2015, we are increasingly optimistic about the potential of the business," Sayiner added.

ISIL closed Wednesday's regular trading session at $12.34, up $0.18 or 1.48% on a volume of 1.06 million shares. The stock gained a further $0.46 or 3.73% in after-hours trading.