A long-term chart of semiconductor company LSI Logic (NYSE:LSI) may well remind you of a mountain range. Like most other semiconductor companies, consistency has been the hobgoblin of investors' minds as this company has ridden the cyclical boom-and-bust cycle.

Judging by the company's second-quarter results, we're closer to "bust," but moving slowly back toward "boom." Revenue for the period was up 7%, ahead of mean analyst estimates. Though the company's gross margins slipped a bit, the loss was more than recouped by lower operating expenses. Operating margins also improved nicely.

Though the company doesn't break out segment results to any significant level of detail, its report provided a few nuggets of information. Semiconductor revenue grew 8% in the quarter, while the smaller storage-systems business grew 6%. Revenues from communications applications climbed a better-than-expected 9%, and the company's DoMiNo product enjoys good results in consumer applications like DVD recorders and set-top boxes. What's more, products such as Apple's (NASDAQ:AAPL) iPod and Sony's (NYSE:SNE) PlayStation have become high-profile showcases for LSI chips.

One of the interesting things about LSI Logic is that nobody seems to be expecting much from it anymore. Analysts appear fairly unexcited about the company's prospects, and there are a couple of "sell" ratings out there.

Perhaps people are just holding their breath until new CEO Abhi Talwalkar begins showing his cards. He's supposed to present his plans for the company to investors on Sept. 14. Prior comments suggest that he's going to withdraw from underperforming businesses and shift resources to more promising areas, not unlike recent moves at National Semiconductor (NYSE:NSM). In any event, I think a lot is expected of this former Intel (NASDAQ:INTC) executive, and I know that his first moves will be closely watched.

There may ultimately be good reasons to acquaint yourself with this company between now and mid-September. As I look at the numbers for both free cash flow and structural free cash flow, and the improving balance sheet, I can see some turnaround potential here. Couple that with a more dynamic vision from the big chair, and LSI Logic starts to look like an opportunity.

At the same time, I'm reminded of a quote that was attributed to former Dallas Cowboys lineman Randy White: "Potential is that fancy French word that means you ain't done nothin' yet." Potential is all well and good, but LSI Logic will need to change from within if it wants to be anything more than a plaything of the semiconductor cycle.

Semirelated Foolishness:

Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).