Cypress Revises Expectations As Revenues Halved In 6 Months News from E-InSite Cypress Semiconductor Corp. today lowered revenue projections forthe second quarter to the $175 million to $185 million range. This represents a 29 percentto 33 percent decline from the previous quarter's revenue of $262 million.
Cypress (nyse: CY) had previously said it expected revenues of $200 million to $210million for the second quarter. San Jose-based Cypress also warned that earnings beforegoodwill (EBG) will now be in the breakeven to 2 cents per share range.
“Cypress's revenue has literally been cut in half over the last six months,from the fourth quarter 2000 record revenue of $370 million to roughly $180 million inrevenue this quarter,” said T.J. Rodgers, Cypress' chief executive officer, in astatement. “Our near-term goal is to endure this severe decline without losing anymoney.”
In trading today, shares in Cypress increased by 2.1 percent to $21.60, with themarkets buoyed by positive comments from Federal Reserve Chairman Alan Greenspan,regarding a lack of inflationary pressure in the U.S. economy.
“Business conditions have not materially improved in the market segments that weserve,” Rodgers continued. “The computation segment, roughly 20 percent ofrevenue, which earlier showed some signs of recovery, has stalled though it is stilllikely to strengthen in the second half of 2001. The wireless infrastructure and wirelessterminal segments, roughly 30 percent of revenue, have exhibited some positive movementbut inventory levels remain high and the segment likely will not resume growth until thefourth quarter of this year.”
Rodgers said the company's wide area and storage area network segments, which makeup about half of the company's revenue, are showing little sign of growth, sufferingfrom both slow end demand and high inventory. Rodgers said he expects the WAN segment tobegin displaying signs of recovery next year.
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