LSI Reports Second Quarter 2008 Results
MILPITAS, Calif., July 23, 2008 – LSI Corporation (NYSE: LSI) today reported results for its second quarter ended June 29, 2008.
Second Quarter News Release Summary
- Second quarter 2008 revenues of $692 million, exceeding guidance
- Second quarter 2008 GAAP* net loss of 2 cents per share
- Second quarter 2008 non-GAAP** net income of 13 cents per diluted share, exceeding guidance
- Second quarter operating cash flows of $27 million
- Cash and short-term investments of $1.1 billion
Third Quarter 2008 Business Outlook
- Projected revenues of $695 million to $725 million
- GAAP* net (loss)/income in the range of ($0.03) to $0.04 per share
- Non-GAAP** net income in the range of 11 to 15 cents per diluted share
* Generally Accepted Accounting Principles.
** Excludes goodwill impairment, stock-based compensation, amortization of acquisition-related intangibles, restructuring of operations and other items, net, purchase accounting effect on inventory, loss on write-down of equity securities and acquired in-process research and development. It also excludes the income tax effect associated with the above mentioned items.
Double-digit Sequential Growth in Storage Systems and Networking Drives Solid Quarterly Results
Second quarter 2008 revenues were $692 million, a 3% increase year-over-year compared to $670 million reported in the second quarter of 2007, and up 5% sequentially compared to $661 million reported in the first quarter of 2008. Adjusting for the sale of the consumer and mobility businesses, second quarter revenues increased 24% year-over-year compared to the second quarter of 2007.
Second quarter 2008 GAAP* net loss was $14 million or 2 cents per share, compared to second quarter 2007 GAAP net loss of $378 million or 50 cents per share. Second quarter 2008 GAAP results compare to first quarter 2008 GAAP net loss of $14 million or 2 cents per share. Second quarter 2008 GAAP net loss included a net charge of $97 million from special items, consisting primarily of $58.6 million of amortization of acquisition-related items, $20.7 million of restructuring costs and other items, and $19.6 million of stock-based compensation expense.
Second quarter 2008 non-GAAP** net income was $83 million or 13 cents per diluted share, compared to second quarter 2007 non-GAAP net loss of $14 million or 2 cents per share. First quarter 2008 non-GAAP net income was $64 million or 10 cents per diluted share.
Cash and short-term investments totaled approximately $1.1 billion at quarter end.
"Strong worldwide demand for our storage systems and networking products helped us deliver another quarter of solid results," said Abhi Talwalkar, LSI president and chief executive officer. "During the quarter, we also continued to build significant momentum for the future, introducing several new storage and networking products and securing additional silicon design wins with top- tier hard disk drive and server makers.
"Our business has demonstrated resilience through recent market uncertainty, and we expect this to continue as the positive effects of seasonal buying patterns materialize in the second half," added Talwalkar.
Bryon Look, LSI chief financial officer, said, "Our second quarter results reflect the ongoing benefit of the many strategic and operational steps we have taken over the past four quarters. Increases in net income compared to the year-ago period were significant, and we continue to focus on improving our top and bottom line results."
LSI Third Quarter 2008 Business Outlook
||$695 million to $725 million
||$695 million to $725 million|
||39 – 41%
||$40 to $50 million
||45.5 – 47.5%|
||$268 million to $288 million
||$30 to $40 million
||$238 million to $248 million|
|Net Other Income
||Approximately $6 million
|Net (Loss)/Income Per Share
||($0.03) to $0.04
||($0.11) to ($0.14)
||$0.11 to $0.15|
|Diluted Share Count
Capital spending is projected to be around $15 million in the third quarter and approximately $60 million in total for 2008.
Third quarter depreciation and software amortization is expected to be approximately $20 million.
LSI Conference Call Information
LSI will hold a conference call today at 2 p.m. PDT to discuss second quarter financial results and the third quarter 2008 business outlook. Internet users can access the conference call at http://www.lsi.com/webcast. Subsequent to the conference call, a replay will be available at the same web address.
Forward-Looking Statements: This news release contains forward-looking statements that are based on the current opinions and estimates of management. These statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those anticipated in the forward-looking statements. Factors that could cause LSI's actual results to differ materially from those set forth in the forward-looking statements include, but are not limited to: our reliance on major customers and suppliers; our ability to keep up with rapid technological change; our ability to compete successfully in competitive markets; our ability to achieve anticipated synergies following our acquisition of Agere Systems; fluctuations in the timing and volumes of customer demand; the unavailability of appropriate levels of manufacturing capacity; our ability to successfully and timely transition our assembly and test operations to third parties; and general industry and market conditions. For additional information, see the documents filed by LSI with the Securities and Exchange Commission, and specifically the risk factors set forth in the company's most recent reports on Form 10-K and 10-Q. LSI disclaims any intention or obligation to update or revise any forward looking statements, whether as a result of new information, future events or otherwise.
LSI Corporation (NYSE: LSI) is a leading provider of innovative silicon, systems and software technologies that enable products which seamlessly bring people, information and digital content together. The company offers a broad portfolio of capabilities and services including custom and standard product ICs, adapters, systems and software that are trusted by the world's best known brands to power leading solutions in the Storage and Networking markets. More information is available at http://www.lsi.com
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Q2 2008 Financial Tables (PDF, 20KB)