Other than worries among chipmakers over Cisco System Inc.’s quarterly earnings, the sector continues to purr with good news.
However, some analysts caution against overheating with inventory overload.
Chipmakers that supply Cisco products suffered slides in their stock prices when Cisco announced double-digit profits that did not match Wall Street’s optimism. But with earnings forecasts from Texas Instruments Inc. and Qualcomm Inc., and high profits from Analog Devices Inc., the industry seems set to steam ahead. Motorola Inc. raised a significant sum of money for its semiconductor business. On the product side, Intel Corp. unveiled a set of products that reinforce its rising status in wireless networking.
Intel said it is shipping three Intel Pentium M processors that will boost performance for smoother video playback, faster application response and better multi-tasking in wireless laptops. The company said more than 150 laptop PC designs are based on its Centrino mobile technology.
“The new chips are the first mobile processors built on Intel’s 90-nanometer manufacturing technology and feature faster clock speeds, design enhancements and more on-die cache memory for better performance,” said Intel.
Qualcomm said it raised its 2004 growth forecast to between 28 percent and 30 percent on projections of higher licensing royalties and rising demand for its CDMA chips that bundle voice and multimedia offerings.
Analog Devices enjoyed quarterly net income of $152.6 million, or 39 cents a share, up from $71.3 million, or 19 cents a share in the last quarter. Revenue totaled $678.5 million, up from $501.9 million in the previous quarter.
TI chief executive Rich Templeton told analysts that the company will maintain the momentum of the previous quarter when it savored great demand for its chips used in cell phones. He said demand for consumer and entertainment products will fuel sales of Texas Instruments chips.
Motorola raised up to $316 million from selling shares in chipmakers Broadcom Corp. and Semiconductor Manufacturing International Corp. Motorola plans to spin off its chip business, Freescale Semiconductors Inc., later this year.
The vendor raised $216 million by selling all its shares in Broadcom and another $100 million from selling part of its SMIC holdings, according to its document filed with the Securities and Exchange Commission. Motorola controlled less than 5 percent of Broadcom and 7 percent of SMIC.
