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Altera Corp.'s (ALTR) first-quarter net income fell 47%, but the company said the quarter shaped up better than it originally expected.

The semiconductor maker indicated that strength, first hinted at in a revision to revenue guidance in January, continued into the fiscal second quarter, with a fresh outlook for the quarter that easily tops Wall Street estimates.

However, Altera's shares fell 3% to $17 in after-hours trading. The stock price is off more than a quarter since August, even after rebounding by a third since December.

"With double-digit sequential growth, sales to wireless equipment customers, including those targeting new 3G deployments in China, were a bright spot in the quarter," said President, Chief Executive and Chairman John Daane.

Altera has continued to do well as demand for its semiconductors, which are used in products such as televisions and Internet routers, has remained strong. However, in March, the company announced a small round of job cuts as part of a restructuring expected to result in $6 million of charges.

The company reported net income of $44 million, or 15 cents a share, down from $83.9 million, or 27 cents a share, a year earlier. The latest quarter included a 2-cent-a-share hit from restructuring charges and a change in California tax law.

Analysts expected per-share earnings of 16 cents, according to a poll by Thomson Reuters. Analyst estimates typically exclude unusual items.

Revenue fell 21% to $264.6 million.

In January, stronger-than-expected demand from makers of equipment for Chinese 3G wireless networks prompted Altera to raise the bottom end of its revenue outlook, resulting in a range of $251.6 million to $267.4 million.

Gross margin narrowed to 64.5% from 65.1%.

For the second quarter, Altera expects sequential revenue growth of 2% to 7%, which would result in a range of $269.9 million to $283.1 million. Wall Street expects revenue of $259.5 million.

The company expects gross margin to come in within a half-percentage point of 64.5%.

-By Jay Miller, Dow Jones Newswires; 201-938-2331; jay.miller@dowjones.com