Chipmaker Silicon Labs Blasts Higher On Better-Than-Expected Earnings

Chipmaker Silicon Laboratories (SLAB) on Wednesday crushed expectations for its fiscal third quarter and guided much higher for the current period. The news sent SLAB stock skyward.


The Austin, Texas-based company earned an adjusted 34 cents a share on sales of $184.8 million in the quarter ended Oct. 2. Analysts expected Silicon Labs to earn 15 cents a share on sales of $175.2 million, according to FactSet.

Its sales from continuing operations rose 39% year over year. During the third quarter, Silicon Labs completed the divestiture of its Infrastructure and Automotive business to Skyworks Solutions (SWKS) for $2.75 billion in cash.

For the current quarter, Silicon Labs expects to earn an adjusted 55 cents a share on sales of $200 million. That’s based on the midpoint of its outlook. Wall Street was modeling earnings of 19 cents a share on sales of $179 million, FactSet said.

SLAB Stock Breaks Out

In morning trading on the stock market today, SLAB stock rocketed 16.4%, near 180.25. Earlier in the session, it notched a record high 181.77.

On Wednesday, SLAB stock broke out of a 36-week consolidation period at a buy point of 163.53, according to IBD MarketSmith charts.

Silicon Labs is a leader in wireless chips for Internet of Things, or IoT, applications.

“IoT solutions are being adopted at a rapid pace in large, diverse, and fast-growing home and industrial end markets,” Chief Executive Tyson Tuttle said in a news release.

Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.


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