* Expects 4th-qtr revenue of $432.5-$450.5 mln vs est $474.5
* Third-quarter EPS $0.37/shr vs est $0.34/shr
* Revenue $445.9 mln vs est $451.8 mln
* Shares fall 5 pct after the bell
By Aurindom Mukherjee
Oct 22 Programmable-chip maker Altera Corp
forecast current-quarter revenue below Wall Street
estimates, citing fewer orders for its telecom and wireless
products, sending its shares down 5 percent after the bell.
Altera, which also reported lower-than-expected sales for
the quarter ended Sept. 27, forecast current-quarter revenue to
be down 3 percent to up 1 percent, compared with the third
That implies fourth-quarter revenue of between $432.5
million and $450.5 million. Analysts on average were expecting
revenue of $474.5 million, according to Thomson Reuters I/B/E/S.
Altera forecast revenue in its telecom and wireless
business, the company's biggest, to be flat.
"There was a belief that the China Mobile build out was
going to drive more revenues," RBC Capital Markets analyst Doug
Freedman told Reuters.
Altera's two biggest customers, Huawei Technologies Co Ltd
and ZTE Corp , have secured more
than half of China Mobile's initial 4G contracts worth about 20
billion yuan ($3.2 billion), sources said in August.
There was an expectation that it was going to show in their
revenues "but it clearly is not," Doug added.
Semiconductor chips made by Altera and Xilinx are
sold off the shelf and can be programmed by customers to do
specific tasks, eliminating hefty expenses to develop custom
Xilinx forecast current-quarter revenue largely below Wall
Street estimates last week and said its overall growth rate of
the wireless business would be offset in part by a "business
transition" at one of its large European customers.
Analysts speculated the large customer could be Ericsson,
and they expect Altera to gain from Ericsson's move.
However, on being asked by Nomura Equity Research analyst
Romit Shah in a post-earnings conference call, Chief Executive
John Daane said "we would expect that there will be more ramp
transitions over time that will benefit Altera from a market
share perspective, but there is nothing specifically that
happened in the third calendar quarter or in the fourth calendar
Altera's net income fell to $119.4 million, or 37 cents per
share, in the third quarter, from $157.5 million, 49 cents per
share, a year earlier.
Revenue fell 10 percent to $445.9 million.
Revenue from the telecom and wireless business decreased to
41 percent to $182.8 million.
Analysts on average had expected earnings of 34 cents per
share on revenue of $451.8 million.
Altera shares fell to $35.50 in extended trading after
closing at $37.32 on the Nasdaq on Tuesday.