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What: Cirrus Logic
So what: Cirrus Logic, which has entrenched its audio chips in Apple products, was up about 5% yesterday on the heels of Apple's blowout earnings announcement the prior evening. But investors hoping for a similar earnings surprise from Cirrus only saw the company beat analysts' $0.23-per-share estimates by a single penny. Revenue growth matched Wall Street's prediction, growing 13% year over year.
Now what: EPS fell 17% year over year, primarily due to a production issue that was disclosed in April. Management said it expects the production problem to be resolved by the end of this quarter. It's expected to hurt profits again this quarter; management guided to gross margin of only 52% to 54%, compared to 56.4% in the year-earlier quarter.
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