Altera updates Q3 guidance

SAN JOSE, USA: Altera Corp. announced that, based on quarter-to-date results and a broad improvement in market conditions, the company now expects third quarter sales to be in a range of flat to up 3 percent from the second quarter. Previous guidance had been for sales to decline 1 to 5 percent sequentially.

All market segments, except for the telecom and wireless segment, will be up sequentially in the third quarter. The decline in telecom and wireless is more moderate than previously anticipated as a result of better than forecast demand from OEMs supplying Asian wireless networks.

As previously announced, third quarter results will include approximately $4.5 million in severance costs, with nearly all of these costs being included in third quarter operating expense.

These actions will create approximately $1.0 million in operating expense savings in the third quarter and, when fully implemented, approximately $9 million in annual run rate savings. Including the net effect of this restructuring, Altera now anticipates that third quarter operating expense will be in the range of $126 to $128 million compared with prior guidance of $122 to $126 million.

Design wins for Altera's newly launched 40-nm products continue to be very strong. As anticipated, third quarter sales of 40-nm products are likely to approximate $10 million, more than double second quarter levels.