Intersil Says Profit Won’t Meet Forecast

Semiconductor maker Intersil Holding Corp. warned Thursday that its revenue and earnings for the first quarter will be lower than expected as customers buy less to reduce inventories.

The Irvine company expects first-quarter revenue--excluding sales from its Discrete Power unit--to be about 25% lower than fourth-quarter revenue of $217 million, instead of the 11% reduction previously forecast. First-quarter profit is expected to be about 5 cents a share, less than the 20 cents that analysts have been expecting, according to a survey by First Call/Thomson Financial.

Intersil, whose chips manage power consumption in personal computers, said PC makers are cutting back on orders because they had built up chip inventories, expecting higher demand. Cutting inventories has taken longer than expected, company spokesman Brent Dietz said.

In addition, the Irvine company announced that its board authorized the buyback of up to $50 million of Intersil’s stock.

Intersil said it expects to complete the sale of its Discrete Power product line to Fairchild Semiconductor this month.

Shares of Intersil fell $1.94 to $19.75 in Nasdaq trading. They have decreased 14% this year.