Shares of Synaptics Inc. (NASDAQ: SYNA) skyrocketed in afterhours trading on Tuesday after the touchscreen chip maker upwardly revised its outlook for the fiscal fourth quarter, citing robust demand for its products from smartphone makers.
For the fiscal fourth quarter ended June 30, the Santa Clara, California-based company expects revenue to be in the range of $227 million or $230 million up from its initial guidance of $190 million to $205 million. Analysts’ consensus estimate was for revenue of $198.15 million.
Gross margin is expected to be around 50%.
The touchscreen technology provider said that revenue from mobile products was better-than-expected, underpinning robust demand for its cutting edge technology from smartphone makers. Synaptics supplies its touchscreen technology to companies such as Samsung, Blackberry and HTC among many other customers.
Speaking to Reuters, Jeffrey Schreiner an analyst at Feltl & Co said, a “good portion” of upwardly revised guidance can be attributed to strong demand from Samsung Electronics.
“A lot of this could be due to continued builds for the S4 (Samsung’s new model under Galaxy series), maybe build for the Note 3, the S4 Mini, which we believe they probably were in that as well, a few other designs. The S4 Active is another version,” added Schreiner, according to Reuters.
Schreiner also added that demand from other handset makers such as HTC Corp, Sony Corp and LG Electronics must be also helping driving up sales.
Kevin Cassidy, co analyst at Stifel Nicolaus also said that sales of other handsets such as from HTC could be better-than-expected.
The Company is slated to report fiscal fourth quarter results on August 1.
Shares of Synaptics climbed 14.36% to $41.02 in afterhours trade after gaining 2.05% in regular trading hours on Tuesday.
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