OmniVision Technologies' (NASDAQ: OVTI) shareholders did not have a happy hump day. The company reported second-quarter earnings yesterday evening, and while results did beat the Street's expectations, OmniVision's guidance for the third quarter disappointed investors.
OmniVision said it now expects revenue of $310 million to $340 million for Q3, with adjusted EPS of $0.28 to $0.44. Analysts wanted revenue of $402 million and EPS of $0.43. The company partly blamed a "slowing smartphone market and intensifying competition," but the fact is, OmniVision has never really recovered since losing its coveted spot in Apple's (AAPL 0.64%) iPhone to Sony.
OmniVision's bread-and-butter product -- backside-illuminated sensors -- has become a commoditized component, and competition from larger rivals like Samsung (NASDAQOTH: SSNLF) and Sony has put pressure on pricing. OmniVision's margins have subsequently cratered, making the company's future look rather dim.
