Dec. 10, 2009 -- National Semiconductor Corp. (NYSE:NSM) today reported sales of $345 million and net income of $47.0 million, or 20 cents per diluted share, for the second quarter of fiscal 2010, which ended Nov. 29, 2009.
National's second quarter sales were 10 percent higher than the first quarter of fiscal 2010, when the company reported $314 million in sales, but lower than the $422 million reported in last year's second fiscal quarter. Sequential improvement in second quarter sales was driven mainly by increased demand in industrial markets, which are primarily served through distributors. 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.
Company Declares Dividend
The company announced today that the Board of Directors has declared a cash dividend of $0.08 per outstanding share of common stock. This dividend will be paid on Jan. 11, 2010 to shareholders of record at the close of business on Dec. 21, 2009.
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. Except for historical information contained herein, the matters set forth in this press release, including management's expectations regarding future performance, are forward-looking statements that involve certain risks and uncertainties that could cause actual results to differ materially from those forward-looking statements. Potential risks and uncertainties include, but are not restricted to, such factors as new orders received and shipped during the quarter, the degree of factory utilization, the sale of inventories at existing prices, and the ramp up and sale of new analog products. Other risk factors are included in the company's annual report on Form 10-K for the fiscal year ended May 31, 2009 under the captions "Outlook," "Risk Factors" and "Management's Discussion and Analysis of Financial Conditions and Results of Operations" contained therein and the quarterly report on Form 10-Q for the quarter ended Aug. 30, 2009.