Analyst Conference Summary


conference date: July 23, 2007 @ 2:00 PM PT
for quarter ending: June 29, 2007 (2nd quarter)

Full summary will be available shortly after conference ends.

Forward-looking statements


Basic data:

Revenues were $319.7 million, up 5% from Q1 but down 4% from year-earlier.

Net income was $80.5 million, up 4% from $77.3 million year-earlier.

Earnings were $0.22 per share, up 5% from $0.21 per share year-earlier.

Ended quarter with $1.3 billion in cash and investments.


Q3 outlook is revenues flat to up 3%. Gross margins 64% to 65%. R&D in the mid-$70 millions, SG&A in the high-$60 millions. Tax rate 13% to 15%. $7 million capital expense.

Conference Highlights:

$316 million was spent repurchasing stock shares.

Negotiating a credit facility of $750 million, of which $500 million would be used for stock repurchases.

HardCopy Structured ASICs and newer programmable devices did well in quarter. Pleased to see resumption of sequential growth. Stratix III FPGAs will come out in Q3. First low cost Arria GX FPGAs have already shipped.

Largest 21 customers grew faster than remaining customer base.

64.6% gross margin, down slightly sequentially. Long term model is 65%.

FPGAs 3% up sequentially.

CPLD 3% up sequentially.

HardCopy 60% sequential improvement.

Computer and Storage and Communications sectors were aligned with guidance. Consumer was

$131 million total operating expenses: $63 million R&D and $68 million SG&A. Cost of sales was $113 million. $5 million capital expense. Gross margin was $206.6 million.

Inventory fell and is towards low end of model.

New product revenue grew 26% sequentially.

Not yet seen all communications customers return to the level they were at prior to telecom company consolidation. But 11% rise in consumer business. Test and measurement market weakened.



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Disclaimer: Our analyst summaries may include both our condensations of statements made by company representatives and our own analysis. They are not covered by any warranty. We cannot guarantee anything said by company representatives is true. We try not to make errors, but it is possible. Before making or terminating an investment you should always verify any factual basis of your decision.

Copyright 2007 William P. Meyers