The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Tower Semiconductor met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded significantly, and GAAP earnings per share contracted to a loss.
Margins shrank across the board.
Tower Semiconductor tallied revenue of $174.6 million. The three analysts polled by S&P Capital IQ expected sales of $175.8 million on the same basis. GAAP reported sales were 29% higher than the prior-year quarter's $135.1 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
Non-GAAP EPS came in at $0.11. The two earnings estimates compiled by S&P Capital IQ anticipated $0.10 per share on the same basis. GAAP EPS were -$0.05 for Q4 against $0.01 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 10.1%, 1,460 basis points worse than the prior-year quarter. Operating margin was -1.7%, 1,720 basis points worse than the prior-year quarter. Net margin was -9.6%, 1,060 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $169.3 million. On the bottom line, the average EPS estimate is $0.05.
Next year's average estimate for revenue is $742.7 million. The average EPS estimate is $0.22.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 123 members rating the stock outperform and four members rating it underperform. Among 20 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 18 give Tower Semiconductor a green thumbs-up, and two give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Tower Semiconductor is buy, with an average price target of $2.67.
New mobile devices are changing the game, and potential profitability, at many semiconductor companies. Some will fail, some will tread water, and those in the right devices will shine. Where does Tower Semiconductor fit in? Who will lead going forward? Check out "3 Hidden Winners of the iPhone, iPad, and Android Revolution." Click here for instant access to this free report.
- Add Tower Semiconductor to My Watchlist.
Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.