Semiconductor Firm’s Stock Drops
National Semiconductor Corp.'s shares fell 12% after the computer chipmaker said orders in its fiscal second quarter slowed, even as profit more than tripled, beating expectations. Shares of National Semiconductor fell $3.625 to $27 as more than 6.4 million shares changed hands.
Analysts said slowing orders, a “modest” outlook for next quarter and disappointing revenue at Cyrix Corp. were the reason for the reaction. National bought Cyrix, which makes processors that compete with Intel Corp., for $559 million in November.
“The outlook for the next period was tempered,” said analyst Tad LaFountain at Dominick & Dominick Inc. He said third-quarter sales are expected to increase less than 10% from the second quarter.
National said its profit from continuing operations, excluding Cyrix, for the quarter ended Nov. 23 rose to $72.5 million, or 46 cents a share, from $21.8 million, or 14 cents, a year earlier.
National said orders slowed in September, recovered in October and continued to accelerate in November.