Silicon Valley is dividing itself into two distinct camps. In the red corner, we have disappointing market forecasts for coming quarters based on soft orders in June and macroeconomic issues. Here you'll find touchscreen controller specialist Cypress Semiconductor
In the blue corner (or is it black?), the late summer, fall, and ensuing holiday season look much brighter with raised sales guidance and happy faces all around. Broadcom
And now you can add radio chip builder RF Micro Devices
RF Micro shares are soaring today, gaining nearly 4% in early trading on an otherwise gloomy market day. The company slid past expectations on both the top and bottom lines with earnings of $0.08 per share on $214 million in first-quarter sales. For the second quarter, management sees revenue in line with Street estimates.
Backing up the positive forecast, the company expects to widen gross margins slightly while growing sales among a more diverse customer base. That includes stealing market share in 3G and 4G tablets and smartphones, where the main competition comes from other RF players like Skyworks
CEO Bob Bruggeworth talked himself warm over increasing demand and plans to capitalize on strong markets; not once did he use the words "challenging," "macroeconomic," "cautious," or "wildebeest." (Just checking if you're paying attention.)
So which Valley is the real deal? Your answer will determine how you feel about buying chip stocks in this environment. My opinion should be obvious when you consider that I bought shares of memory-chip guru Micron Technology
That's my two cents. What do you think about semiconductor stocks in this market? Share your thoughts in the comments section below.
