Shares of Mindspeed Technologies Inc. surged in early trading today after the Newport Beach-based networking chipmaker raised its revenue target for the September quarter.
Investor sent Mindspeed shares up more than 23% in afternoon trading to a market value of about $127 million after the company upped its revenue guidance to $35 million to $36 million, above Wall Street estimates.
Analysts on average forecast revenue of $34.4 million in the current quarter.
Mindspeed had earlier forecast revenue in the September quarter of $33.5 to $35.5 million.
Rising demand in the company’s landline business, particularly high-performance analog and VoIP (Voice over Internet Protocol) products, drove the renewed outlook, according to Chief Executive Raouf Halim.
“Furthermore, we believe that the Picochip acquisition and integration, as well as our global restructuring efforts to accelerate operating profitability have already begun to show marked benefits,” he said.
The company plans to cut more than 80 jobs as part of a restructuring plan to lower costs, Halim said during a conference call with analysts following June quarter earnings.
The cuts will be spread evenly between research and development, sales and administrative personnel.
That will save the company about $13 million per year and bring companywide employment to about 500.
The Business Journal in May reported Mindspeed cut about 25 employees following January’s acquisition of U.K.-based Picochip Ltd. for $51.8 million and up to $25 million in additional benchmark payments.