Friday, October 20, 2006
Fairchild Semiconductor reported sharply higher earnings and sales for the three months that ended Oct. 1.
The South Portland-based company said it had profits of $25.1 million, or 20 cents a share, in the third quarter, compared with a loss of $20.8 million, or 17 cents a share, during the same three-month period last year. During this year's second quarter, Fairchild earned $23 million, or 18 cents a share.
The company said sales were at the high end of its guidance range, totaling $417 million. That's 3 percent higher than second quarter sales and 21 percent more than the third quarter of 2005.
"We reported another solid quarter of sales growth paced by continued strong demand for our power products," said Mark Thompson, Fairchild's president and chief executive officer.
Thompson said Fairchild's power switches and power conversion products posted sales increases of at least 5 percent compared with the second quarter, and analog switches sold at a record rate, up more than 45 percent compared with same period a year ago.
"Sales were at or above the prior quarter levels for virtually all end markets with particular strength in products supporting the computing and consumer end markets," said Thompson. "Order rates were seasonally slower in the summer months and then improved in late August and September."
Going forward, Fairchild said it expects fourth-quarter revenue to be flat to up about 2 percent compared with the third quarter. The company said its order backlog is slightly higher than it was at the beginning of the third quarter, and it expects expenses to remain stable.
Not included in the results for the third quarter was the potential cost of an ongoing patent infringement trial in Delaware.
Last week, a jury ruled against Fairchild in the first phase of the trial, awarding the company's rival, Power Integrations, $34 million in damages.
Fairchild said it believes the patent claims by Power Integrations are not valid and noted that the second phase of the trial, before a different jury, will begin in December and deal with the validity of Power Integration's patents.
The first phase focused on infringement, the willfulness of any infringement and damages, Fairchild said. The South Portland company said it has evidence of inventions and publications that predate Power Integrations' patents, which may invalidate them.
The final phase of the trial, before a judge, will deal with the enforceablity of the patent claims.
The case isn't expected to be completed until next year.
Power Integrations has said that if it prevails in the second phase of the trial, it will ask the court to force Fairchild to stop making and selling the pulse-width modulation devices involved in the dispute.
According to a Power Integrations release, the devices are found in consumer products such as cell phone chargers, DVD players, TV set-top boxes, LCD monitors and other devices.
Fairchild said in April that it had filed a patent infringement suit against Power Integrations, separate from the one currently proceeding, that also involves pulse-width modulation products.
Fairchild has 9,000 workers worldwide, including roughly 1,025 at its headquarters and a fabrication facility in South Portland.
Staff Writer Edward D. Murphy can be contacted at 791-6465 or at:
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