Shares of Linear Technology (NASDAQ:LLTC) climbed more than 2% in trading today after the company reported solid quarterly results.

For the first quarter, the analog chipmaker saw revenues climb 45% over last year's quarter to $253 million. Meanwhile, earnings grew 49% to $69.5 million, or $0.33 per share -- a penny better than the analysts' estimate.

Linear managed to improve on the impressive Microsoft (NASDAQ:MSFT) and eBay (NASDAQ:EBAY) type margins exhibited by Linear and its fellow chipmakers in the analog space, including Maxim Integrated Products (NASDAQ:MXIM) and National Semiconductor (NYSE:NSM). Gross margins in the first quarter clocked in at 78% -- up from 76% last year -- as net margins inched up to 41% from 40%. With the copious amount of cash flow dripping to the bottom line, Linear noted that it had spent $54.6 million during the quarter to buy back 1.5 million shares.

The first quarter basically looked good as expected, with anxious eyes on the current quarter.

While sales grew 6% sequentially in the first quarter, Linear expects sales in the second quarter to come in flat or at a slight decline; analysts currently forecast a slight sequential revenue increase. CEO Robert H. Swanson -- who announced last week that he would step down as CEO, shifting to a role as executive chairman -- noted in the earnings release that bookings softened during the quarter as "end-demand appeared to ease."

Swanson said that shipments from Linear's distributors to their end customers had decreased moderately. As a result, the company wasn't sure whether the decline reflected a tightening of inventory combined with "minor seasonal end-demand reductions" or whether the decline in demand was a sign of increasingly substantial weakness to come. That said, Swanson also expressed that Linear Technology viewed the tightening as only "temporary," as ending on-hand inventory at the company's distributors is "lean," cancellations are still "minimal," and lead times remained "unchanged" at four to six weeks.

In all, it was another solid first quarter for an attractive, cash-generating machine. While the revenue forecast for the second quarter is lighter than the analyst estimate, the market response indicates investor relief in that the picture could be far worse than "temporary" and "moderate." Still, bookings and revenues are numbers investors will clearly be watching over the coming months.

Fool contributor Jeff Hwang owns eBay shares.