Entropic Comms to Cut Jobs; Q2 Guidance Narrowed

Not long after reporting a lackluster Q1, Entropic Communications (NASDAQ: ENTR  ) has announced a restructuring initiative. The plan consists of the company "making strategic organizational changes across its marketing and business operations to focus on key vertical markets, streamline global manufacturing resources, and consolidate several engineering activities to drive efficiencies."

It is expected to result in a thinning of the firm's workforce by around 70 employees, or roughly 10% of its global total. The full annualized costs of those workers are estimated at $9 million, the savings of which the company will reinvest into developing new products and programs.

Entropic also fine-tuned the guidance for its current Q2 2013. It now believes its key figures will come in on the low end of its previously announced range. This means revenue of around $70 million. EPS on a non-GAAP basis is anticipated to be $0.00.

The company is scheduled to release its Q2 results on July 31.


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  • Report this Comment On July 02, 2013, at 8:26 PM, stockjhn wrote:

    This is no real change from the previous guidance. CEO Henry stated," business is in the pipeline for the 3rd quarter and for the 4th quarter." Now that Henry is also cutting more waste, which was needed, this helps Q3 and Q4 even more. No one ever expected very much from Q2.

    It is an astutely timed move.

  • Report this Comment On July 02, 2013, at 8:59 PM, stockjhn wrote:

    Insiders have bought heavy because they must have knowledge of a lot of business coming in-house in the near term. (Q3 or Q4)

    CEO Henry stated, "the business is in the pipeline."

  • Report this Comment On July 03, 2013, at 1:33 AM, stockjhn wrote:

    Looking more closely, the move appears to concern Entropic's latest acquisition.

    Entropic acquired Mobius Semiconductor.

    Entropic gains Advanced Analog Mixed-Signal Technology and Expertise.

    Entropic said freeing the funds was a strategic move planning to develop Special Analog Mixed-Signal Products.

    The Semiconductor Industry Association groups mixed-signal ICs in two categories: custom, or special, analog circuits and digital ASICs, with worldwide revenue in 2000 reaching roughly $19 billion and $9.9 billion, respectively, according to the SIA

    More and more so-called SoCs are going to have mixed-signal capability, particularly when production capacity is short, Semico's Feldhan said. "You may want to spend the extra money to get an integrated chip, even if it's not an absolute system requirement, because you'll have fewer chips to buy."

    Mixed-signal elements can be included on an SoC, said John O'Boyle, director of marketing at Samsung Semiconductor's Cubic Solutions Group in San Jose, a maker of digital ASIC and mixed-signal SoCs. "We typically include a processor core with A/D converters, phase-locked loops, and RF blocks."

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