Altera 3Q Profit Down 40%; 4Q Revenue Outlook Tops Estimate

   DOW JONES NEWSWIRES 
 

Altera Corp.'s (ALTR) third-quarter earnings dropped 40% on lower sales and a restructuring charge, but the logic-chip maker experienced steadily improving business conditions.

The company predicted fourth-quarter revenue above Wall Street's expectations.

"Sales of 40-nm devices tripled sequentially. Our first-to-market position and technology advantages at 40-nm continue to drive record design-win results," said Chief Executive John Daane.

Altera, which designs chips that customers can program for use in such products as Internet routers, mobile-phone base stations, flat-panel televisions and DVD players, has seen demand fall amid the recession.

The company reported earnings of $56.7 million, or 19 cents a share, down from $94.7 million, or 31 cents a share, a year earlier. The latest quarter included a $4.8 million pretax restructuring charge.

Net sales fell 20% to $286.6 million.

Analysts estimated earnings of 19 cents on revenue of $283.3 million, according to a poll by Thomson Reuters.

Gross margin rose to 67.3% from 67.1% a year earlier.

Sales of new products rose 7% from the previous quarter.

For the fourth quarter, the company expects sequential sales growth of 6% to 10%, which would translate to a range of $303.8 million to $315.3 million. Analysts estimated $292 million.

Altera also expects gross margin of 67% to 68%.

Shares rose 1.6% to $21.77 in after-hours trading. The stock has gained nearly 25% in the past year.

-By Jay Miller, Dow Jones Newswires; 201-938-2331; [e-mail]