UPDATE 2-PMC-Sierra’s Q2 tops Wall Street; sees strong Q3 rev

* Q2 adj EPS $0.20 vs est $0.19

* Q2 rev $160.7 mln vs est $159.4 mln

* Sees Q3 rev $169 mln-$177 mln
(Recasts; Adds conference call details, updates share
movement)

BANGALORE, July 22 (BestGrowthStock) – Chipmaker PMC-Sierra Inc
(PMCS.O: ) posted second-quarter results that modestly beat Wall
Street expectations, helped by growth in its enterprise storage
and fiber-to-the-home businesses, and forecast strong
third-quarter revenue.

The company, which makes chips for the enterprise and
communications infrastructure markets, forecast revenue of $169
million to $177 million.

Analysts were looking for third-quarter revenue of $168.8
million, according to Thomson Reuters I/B/E/S.

Shares of the Santa Clara, California-based company, which
were down about 3 percent at $8.20 after the bell, pared some
of their losses to trade at $8.31 after the company gave its
outlook. They closed at $8.47 Thursday on Nasdaq.

The company had a shippable backlog of $139 million at the
beginning of the third quarter, a company executive said on a
conference call.

PMC-Sierra said it expects adjusted operating margins of 68
percent, give or take 50 basis points, in the third quarter.

The company’s storage, fiber-to-the home and microprocessor
businesses will drive growth in the third quarter, the company
said.

The current quarter will also benefit from the recently
acquired channel storage business from Adaptec Inc.

In June, the company acquired Adaptec Inc’s channel storage
business for $34 million in cash to strengthen its enterprise
storage business. The acquisition contributed a couple of
million dollars to second-quarter revenue, the company said.

For the second quarter, the company earned $30.1 million,
or 13 cents a share, compared with $7.8 million, or 3 cents a
share, a year ago.

Excluding items, PMC-Sierra, which competes with companies
such as Altera Corp (ALTR.O: ), Applied Micro Circuits (AMCC.O: )
and Broadcom Corp (BRCM.O: ), earned 20 cents a share.

Revenue rose 30 percent to $160.7 million.

Analysts were expecting earnings of 19 cents a share,
excluding items, on revenue of $159.4 million.

Stock Market Report

(Reporting by Manasi Phadke in Bangalore; Editing by Maju
Samuel)

UPDATE 2-PMC-Sierra’s Q2 tops Wall Street; sees strong Q3 rev