TI Home > News Releases

News Releases

National Semiconductor Reports $29.7 Million Profit, Earnings of 15 Cents per Share for First Quarter of FY 2004

Gross margin improved to 47.2%, up from 44.6% in Q4

Q1 revenues reached $424.8 million, comparable to Q4's revenue of $425.3 million

Positive book-to-bill in Q1

National starts Q2 with highest 13-week backlog in 10 quarters

Company projects 4% to 7% revenue growth in Q2

Expenses projected to decrease in Q2 as a result of profit-improvement actions

Sep 4, 2003

September 4, 2003 - National Semiconductor Corporation (NYSE:NSM) today reported a GAAP profit of $29.7 million, or 15 cents per share, on revenues of $424.8 million for the first quarter of fiscal 2004, which ended August 24.  The first quarter net profit included special charges of $12.6 million, primarily for severances and asset impairments, and a $1.9 million net charge for implementing FAS 143, a new accounting standard.  These charges were partially offset by miscellaneous gains of $9.1 million.  Without these charges and gains, National would have reported net after-tax income of $34.7 million, or earnings of 18 cents per share.

"Our numbers speak for themselves," said Brian L. Halla, National's chairman, president and CEO.  "In one year, we've improved National's summer quarter profits from $1 million to nearly $30 million and we're continuing to gain share in our key analog markets."

National's first quarter revenues were slightly higher than last year's first quarter revenues of $420.6 million. National's net income for the first quarter of fiscal 2003 was $1.3 million, or 1 cent per share.  Due to an improved product mix and increased factory utilization, the company's gross margin for the first quarter of fiscal 2004 was 47.2 percent, a 3.9-percentage point increase from the 43.3 percent gross margin reported a year ago, and a 2.6-percentage point increase from the 44.6 percent gross margin reported for the fourth quarter of fiscal 2003.  On a sequential basis, first quarter fiscal 2004 revenues were comparable to fourth quarter 2003 revenues of $425.3 million.

Backlog Improves
Worldwide bookings exceeded billings in the first quarter of fiscal 2004.  Orders showed particular strength in the Asia Pacific and Japan regions.  In addition, National started the second quarter of fiscal 2004 with the highest 13-week backlog in 10 quarters.  Overall bookings for the first quarter showed a slight seasonal decline from the spring quarter.  However, order rates improved as the quarter progressed. 

Portable Power Management and Wireless product orders led the company with significant year-to-year and sequential bookings growth.  For example, orders for National's Power Management products grew 36 percent year-to-year and 13 percent sequentially.  Within power management, orders for portable applications grew more than 70 percent year-to-year and 30 percent sequentially. Bookings for Data Conversion and PC products also outpaced the company's overall bookings rate.

Outlook for Q2 2004
National's guidance for the second quarter of FY 2004 is for revenues to grow 4 to 7 percent sequentially.  Consistent with this revenue growth, gross margins are expected to increase to more than 48 percent. The company also expects operating expenses to decrease in the second quarter.  These reductions are consistent with profit-improvement actions National launched in the second half of fiscal 2003.

"The steps we've taken this year to generate 'higher returns faster' are clearly working," said Halla.  "Our focus on National's core analog strengths and our investments in its fastest growing areas, such as power management, are paying off.  We are confident that National's earnings can continue to grow in the future."

Summary of Results

For 3 months ended

For 3 months ended

 

August 24, 2003

August 25, 2002

Net sales

$424.8 million   

$420.6 million   

Net income

$  29.7 million   

$   1.3 million   

Earnings per share diluted

$   0.15          

$   0.01          


Net income excluding special items,
certain gains and the effect of an
accounting change in fiscal 2004
and none in fiscal 2003

$  34.7 million   

$    1.3 million   


Earnings per share excluding special
items, certain gains and the effect
of an accounting change in fiscal
2004 and none in fiscal 2003

$   0.18          

$   0.01          


Special Note
This release contains forward-looking statements dependent on a number of risks and uncertainties pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These factors include, but are not restricted to, new orders received and shipped during the remainder of the second quarter, the degree of factory utilization, the successful construction of our Suzhou assembly and test facility, the successful sale of existing inventories at existing prices, and the ramp up of recently introduced products. Other risk factors are included in the company's 10-K for the year ended May 25, 2003 (see Outlook and Risk Factors sections of Management's Discussion and Analysis of Financial Conditions and Results of Operations) and the Annual Report dated May 25, 2003.

About National Semiconductor
National Semiconductor is the premier analog company driving the information age. Combining real-world analog and state-of-the-art digital technology, the company is focused on analog-based semiconductor products, which include stand-alone devices and subsystems in the areas of power management, imaging, display drivers, audio, amplifiers and data conversion. The company targets key markets such as wireless, displays, PCs, networks and a broad range of portable applications. With headquarters in Santa Clara, California, National reported sales of $1.67 billion for its most recent fiscal year. Additional company and product information is available on the World Wide Web at www.national.com
.