Shares of Newport Beach chipmaker Conexant Systems Inc. fell Thursday after the company lowered its outlook for the December quarter.
Conexant saw a big rally before the close of trading Thursday, with shares rising more than 35%.
In afterhours trading shares were off more than 20% on a recent market value of about $105 million.
For the December quarter, Conexant expects revenue of $103 million to $108 million, short of Wall Street’s expected $125 million in sales.
Chief Executive Scott Mercer said the lower sales projection is “a result of the effects of the overall economy and the fact that the company’s fourth fiscal quarter included one extra week.”
The company said it’s expecting profits of $5 million to $6 million, below analysts’ expected $11 million in profits.
Conexant, which has been undergoing a turnaround for the better part of two years, makes chips for cable modems, cordless and cellular telephones and other products.
It’s been selling off unprofitable businesses and streamlining its operations around the globe, among other cost-cutting efforts.
The lowered outlook comes after Conexant reported results for the September quarter that were slighly ahead of analysts’ expectations.
Conexant reported sales of $123 million, down 11% from the same period a year ago and just ahead of analysts’ expected $122 million in revenue.
Its sales figures do not include results from its business making chips for set-top TV boxes, which it sold for about $145 million to NXP Semiconductors, the former chip arm of Royal Philips Electronics NV.
The company saw profits of $13 million, up from a loss of about $1 million in the year ago quarter and beating analyst’s expected $12 million in profits.
