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Synaptics Stumbles on Guidance (SYNA)

Synaptics Inc. (NASDAQ: SYNA) is not continuing its challenge of a year high after its earnings report.  Despite 9% revenue growth and a rise of 19% in non-GAAP earnings per share, the results are being taken as mixed because of guidance…

By Jon C. Ogg
Published January 26, 2012, 4:41pm ET · 2 min read

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Synaptics Inc. (NASDAQ: SYNA) is not continuing its challenge of a year high after its earnings report.  Despite 9% revenue growth and a rise of 19% in non-GAAP earnings per share, the results are being taken as mixed because of guidance and cautious commentary.

The earnings came to $0.68 EPS versus estimates of $0.62 EPS, but that was non-GAAP and the GAAP earnings report was down at $0.51 per share. The company’s second quarter 2012 net revenues were $145.5 million, but that is down year over year from $159.6 million at a time that Thomson Reuters was calling for $145.38 million in revenues.

Cash flow from operations for the second quarter of fiscal 2012 was $29.2 million, and it ended the quarter with a cash balance of $282.5 million.   Synaptics blamed the revenue trends on a product transition in mobile and a continued soft PC market.

As far as guidance, Synaptics is pointing to estimates in the current quarter of $128 to $136 million and Thomson Reuters has targets of $138 million.  Unfortunately, all of the guidance phrases bleed more caution from the company:

  • “Overall visibility remains limited amidst global macroeconomic concerns.” 
  • “backlog of approximately $69.0 million”
  • “We expect both PC and non-PC revenue to be down sequentially based on seasonal trends.” 

Shares closed up $0.08 at $34.34 against a 52-week range of $21.97 to $34.94 and the after-hours reaction is down about 3% at $33.31.  With slightly lower guidance and within 2% or so of a year high, shareholders are probably glad things are not worse after this report.

JON C. OGG

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Jon C. Ogg

Jon Ogg has been a financial news analyst since 1997. Mr. Ogg set up one of the first audio squawk box services for traders called TTN, which he sold in 2003. He has previously worked as a licensed broker to some of the top U.S. and E.U. financial institutions, managed capital, and has raised private capital at the seed and venture stage. He has lived in Copenhagen, Denmark, as well as New York and Chicago, and he now lives in Houston, Texas. Jon received a Bachelor of Business Administration in finance at University of Houston in 1992. www.247wallst.com.

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