The 10-second takeaway
For the quarter ended June 29 (Q2), Altera beat expectations on revenues and crushed expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped significantly and GAAP earnings per share dropped significantly.
Margins dropped across the board.
Altera logged revenue of $464.8 million. The 27 analysts polled by S&P Capital IQ predicted revenue of $445.5 million on the same basis. GAAP reported sales were 15% lower than the prior-year quarter's $548.4 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 $0.50. The 27 earnings estimates compiled by S&P Capital IQ averaged $0.39 per share. GAAP EPS of $0.50 for Q2 were 23% lower than the prior-year quarter's $0.65 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 69.6%, 130 basis points worse than the prior-year quarter. Operating margin was 34.3%, 910 basis points worse than the prior-year quarter. Net margin was 35.0%, 410 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $471.1 million. On the bottom line, the average EPS estimate is $0.44.
Next year's average estimate for revenue is $1.79 billion. The average EPS estimate is $1.69.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 341 members out of 371 rating the stock outperform, and 30 members rating it underperform. Among 100 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 94 give Altera a green thumbs-up, and six give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Altera is outperform, with an average price target of $40.38.
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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.