Integrated Silicon Soltn (NASDAQ:ISSI)

On July 27, 2010 ISSI reported fiscal 2010 third quarter results:

• Revenue in the third fiscal quarter ended June 30, 2010 was a record $71.2 million, a 24.9% increase from revenue of $57.0 million in the March 2010 quarter and an 83.1% increase from revenue of $38.9 million in the June 2009 quarter.

• Net income for the third quarter was $16.0 million, or $0.57 per diluted share. This compares with net income for the March 2010 quarter of $7.2 million, or $0.27 per diluted share, and a net loss for the June 2009 quarter of $1.9 million, or $(0.08) per diluted share.

The Company currently expects its revenue for the September quarter to be between $74 million and $80 million and its gross margin to be between 34% and 37%. Operating expenses for the September quarter are expected to be in the range of $14.0 million to $14.7 million. Gains on sales of investments and interest and other income in the September quarter are expected to be approximately $0.8 million. As a result of the above, net income per share is expected to be between $0.42 and $0.52 per diluted share.

The stock has not reacted to these strong results, possibly due to the fact that analyst estimates have EPS growth stagnating, beginning in ISSI fiscal 2011 third quarter.

"We are very pleased with our results in the March quarter. Demand for our products was strong and exceeded our expectations in our target markets while DRAM pricing continued to improve. We also had one of our best quarters in new design wins," said Scott Howarth, ISSI's President and CEO. "In addition, the beginning backlog and orders to date for the June quarter have been the strongest we have seen in several years," added Mr. Howarth.

For June quarter, the Company currently expects:

• Revenue to be between $64 million and $70 million
• Gross margin to be between 34% and 37%.
• Operating expenses for the June quarter are expected to be in the range of $12.9 million to $13.4 million. 
• Net income per share is expected to be between $0.44 and $0.50 per diluted share.