The share price of Tower Semiconductor Ltd. (Nasdaq: TSEM; TASE: TSEM) is up sharply, after the company announced that its second quarter guidance would beat the analysts' forecasts, following strong revenue and profit growth for the first quarter of 2014.
The share price rose 7.5% in premarket trading on Nasdaq to $9.08, and rose 5% by mid-afternoon on the TASE to NIS 31.26.
Revenue rose 18% to $132.7 million for the first quarter from $112.6 million for the corresponding quarter of 2013. Organic growth, excluding Micron Technology Inc. (NYSE: MU) long-term contract revenue, was 27%. GAAP-based net profit was $39 million ($0.81 per share), compared with a net loss of $23 million for the corresponding quarter, and non-GAAP net profit tripled to $19.5 million from $6.5 million.
The net profit includes a $150 million one-time net acquisition gain from the high value assigned to Tower’s stake in TowerJazz Panasonic Semiconductor Company, the new company established in Japan, and a one-time allowance of $71 million for non-cash fixed-assets impairment from the closing of Nishiwaki fab operations in Japan, reflecting mainly.
In its guidance, Tower forecasts $230 million revenue, plus or minus 5%, 84% more than the revenue for the corresponding quarter, and above the analysts' consensus of $220 million.
"In view of our continued organic growth and our new TowerJazz Panasonic Semiconductor Corporation enterprise, with associated synergies and cost savings, we expect to demonstrate continued very strong 2014 annual growth; with capability to surpass the $1 billion revenue run rate going forward, enabling sustainable GAAP net profit,” said Tower CEO Russell Ellwanger.
Published by Globes [online], Israel business news - www.globes-online.com - on May 15, 2014
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