National Semiconductor Reports Results for Second Quarter Fiscal 2010

Second quarter net income of $47.0 million, or 20 cents per diluted share, was an increase from the $29.8 million, or 13 cents per share in the first quarter of fiscal 2010. In last year’s second quarter, National reported net income of $36.3 million, or 16 cents per share. Second quarter fiscal 2009 results included a pre-tax $28.1 million restructuring charge.

Gross margin of 65.3 percent in National’s second quarter was an increase from the 61.1 percent gross margin achieved in the first quarter of fiscal 2010 and down from the 65.8 percent gross margin reported in the second quarter of fiscal 2009. Sequential gross margin improvement was due to a combination of a stronger product mix, higher sales volume and improved manufacturing cost performance, including some earlier-than-expected savings realized from wafer fab consolidation.

Bookings for Q2, Fiscal 2010
Driven primarily by higher order rates from distributors serving industrial markets in every major region, National’s total company bookings increased 17 percent sequentially in the second quarter. Bookings exceeded billings in the quarter.

“New order rates for our analog products continued to improve each month through the second quarter, giving us a higher opening backlog for the new quarter,” said Don Macleod, National’s new chief executive officer. “Now that we have restored our gross margins back over the 65-percent threshold, we can put even more of our focus on revenue growth going forward.”

Outlook for Q3, Fiscal 2010
Although the typical seasonal pattern is for third quarter revenues to decline sequentially, National is projecting revenues to be roughly flat in the third quarter of fiscal 2010.