OmniVision Profit Soars, But Misses View; Stock Down - Update

(RTTNews) - Semiconductor image-sensor device maker OmniVision Technologies Inc. (OVTI), Thursday reported a surge in first-quarter profit on higher revenue, partly offset by lower gross margins. While quarterly earnings easily beat Wall Street estimates, sales missed expectations.

Looking ahead, the company detailed some weak earnings and sales outlook for the second quarter, which dragged down its shares 10 percent in after-hours trade on the Nasdaq.

OmniVision products are used in a host of consumer and commercial applications including mobile phones, tablets and entertainment devices. Its soft outlook mainly reflects sluggishness in the smartphone market and increased rivalry, said CEO Shaw Hong.

Hong said the company is pursuing cost reductions across its supply chain, while striving to diversify into potential areas such as automotive.

Santa Clara, California-based OmniVision reported quarterly net earnings of $23 million or $0.42 per share, sharply up from $2 million or $0.04 per share last year.

Results for the quarter included a non-cash tax benefit of about $9 million that resulted from the lapse of applicable statutes of limitations in certain foreign jurisdictions.

Excluding items, adjusted earnings for the quarter were $31.7 million or $0.55 per share, compared with $11.6 million or $0.21 per share a year ago.

On average, 11 analysts polled by Thomson Reuters expected the company to earn $0.43 per share for the quarter. Analysts' estimates typically exclude special items.

OmniVision posted first quarter sales of $373.7 million, up from $258 million last year. Analysts expected sales of $376.58 million for the quarter.

Gross margin for the quarter receded to 17.4 percent from 19.1 percent in the prior year.

For the second quarter, OmniVision expect net earnings in the range of $0.21 to $0.38 per share, adjusted earnings of $0.36 to $0.53 per share, and revenue of $375 million to $410 million.

Analysts currently estimate earnings of $0.49 per share on revenue of $406.6 million for the second quarter.

The company's stock closed Thursday at $18.41, up $0.43 or 2.39%, on a volume of 3.3 million shares on the Nasdaq. In after hours, the stock dropped $1.89 or 10.27%, to trade at $16.52.