The 10-second takeaway
For the quarter ended April 1 (Q1), PMC-Sierra met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped significantly and GAAP loss per share grew.
Gross margins improved, operating margins dropped, and net margins dropped.
PMC-Sierra notched revenue of $132.1 million. The nine analysts polled by S&P Capital IQ expected sales of $133.6 million on the same basis. GAAP reported sales were 16% lower than the prior-year quarter's $157.4 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.06. The nine earnings estimates compiled by S&P Capital IQ predicted $0.05 per share. GAAP EPS were -$0.41 for Q1 against -$0.03 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 69.0%, 30 basis points better than the prior-year quarter. Operating margin was -6.2%, 1,320 basis points worse than the prior-year quarter. Net margin was -72.9%, 6,800 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $147.9 million. On the bottom line, the average EPS estimate is $0.09.
Next year's average estimate for revenue is $614.9 million. The average EPS estimate is $0.45.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 218 members out of 237 rating the stock outperform, and 19 members rating it underperform. Among 50 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 47 give PMC-Sierra a green thumbs-up, and three give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on PMC-Sierra is hold, with an average price target of $7.55.
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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.