Chipmaker Semtech Corp said it expects lower demand from its largest smartphone customers and forecast current-quarter results well below market estimates.
Semtech, whose shares fell about 11 percent in extended trading on Wednesday, said it expects adjusted earnings of 31-37 cents and revenue of $135 million-$145 million in the third quarter.
Analysts on average were expecting earnings of 54 cents on revenue of $169.4 million, according to Thomson Reuters I/B/E/S.
"We expect our Q3 results to be negatively impacted by both a reduction in demand and inventory corrections at several of our largest smartphone customers," Semtech Chief Executive Officer Mohan Maheswaran said in a statement.
The weakness would continue through most of the second half, Maheswaran said.
Semtech makes power management chips for mobile phones, notebook computers and computer peripherals. Its customers include Apple Inc Samsung Electronics Co Ltd and ZTE Corp and Huawei Technologies Co Ltd.
The company reported second-quarter revenue of $165 million, in line with analysts' forecast.
Its adjusted profit for the three months ended July 28 was a cent above the market estimate of 51 cents per share.
Semtech shares closed at $29.64 on the Nasdaq on Wednesday.
(Reporting By Lehar Maan in Bangalore; Editing by Joyjeet Das)