Shares of Newport Beach chipmaker Mindspeed Technologies Inc. rallied Tuesday, a day after the company gave an outlook for the current quarter that surpasses Wall Street’s expectations.
Investors sent shares up more than 35% at close of trading on a recent market value of about $50 million.
For the June quarter, Mindspeed said it’s looking for sales of $30 million to $32 million, ahead of analysts’ expected $28 million in revenue.
It didn’t give a profit outlook. Analysts, on average, are expecting Mindspeed to lose $4 million.
The company also said it’s beginning to see the benefit of its long-running cost cutting efforts.
In a move that’s looked upon favorably by Wall Street, Mindspeed said it anticipates its operating expenses for the June quarter “to represent the lowest operating expense level in the company’s history.”
Oppenheimer & Co. analyst Rick Shafer upped his estimates for Mindspeed and said in a research note that the company is “committed to reducing operating expenses and slowing cash burn as they trend back to breakeven levels.”
Shafer expects 2009 sales of $125 million, up from his previous outlook of $115 million.
He’s looking for a loss of $2 million, less than his previous estimate of a $3 million loss.
The rosier outlook comes on the heels of Mindspeed’s results for the three months through April 3, which were announced after the close of trading on Monday.
Sales totaled $29 million, down 19% from the same period a year ago.
Excluding charges for restructuring and the sale of some assets, Mindspeed widened its loss to $15 million, more than the $2 million it lost in the year-ago quarter.
Mindspeed’s networking chips help run wide area networks in cities and voice over Internet protocol devices.
It’s seen a boost in sales from China, which is in the process of building out its 3G network for cell phones.
