Tuesday, November 08, 2005
IDTI reported after market today and the management sounded positive than the pessimistic market expectations. Top line and EPS was better, guidance is inline for revenues but EPS guidance is higher-just what I want. Company is already 80% booked for the quarter, 10% ahead of typical seasonality- is it demand or are people double ordering? Inventory in the channel and at OEMs seems to be a non-issue. IDTI just closed the ICST acquisition and apart from some back-end issues the integration is on-track and the quarter was quite good. Most end markets were healthy with higher fab utilization and opex consolidation should help bottom line grow faster than top line, another one of my favorite plays on restructuring. Communications declined 5% in Sept (which was inventory burn-off by customers- CSCO) but is expected to grow low-to-mid single digits as month of September has seen strong demand. Will this be reflected in CSCO results tommorrow? Computing was strong for IDTI growing 11% with PC and servers showing seasonal demand. Consumer was down 4% due to declining set-top box offset by digital TV demand.