67 WALL STREET, New York - October 8, 2012 - The Wall Street Transcript has just published its Semiconductors Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.
Topics covered: Semiconductor Capital Equipment - Cloud Computing - Mobile Device Consumer Demand - Enterprise Data Storage Demand - High Computing Power Technology - Semiconductor Inventory Burnoff
Companies include: Semtech Corp. (SMTC) and many others.
In the following excerpt from the Semiconductors Report, the CEO of Semtech discusses the outlook for his company for investors:
TWST: Please begin with an overview and history of Semtech.
Mr. Maheswaran: Semtech is the fastest-growing diversified, high-performance analog chip company. We focus on very high-performance analog mixed-signal products. The company has been around for over 50 years. I joined Semtech in April of 2006 and have been focusing on trying to ensure the company grows at above industry rate.
Today, Semtech is a high-growth company that is very profitable and well balanced. In other words, we are not overexposed to one single market or one single customer or geography. Our balance across geographies, across end markets and our innovative portfolio of products, in some of the most complex areas of analog, are why we've been so successful over the last five years.
TWST: What were Semtech's revenues and earnings in the latest quarter that the company reported?
Mr. Maheswaran: Last quarter, we announced $151 million of revenue and non-GAAP earnings per share of $0.41.
TWST: There is talk anew about semiconductor cycles. Are the company's competitors suffering from weak industry demand or are they losing share to companies such as Semtech? Please make a case for Semtech.
Mr. Maheswaran: At Semtech, our strategy is to outgrow the industry and outgrow our peer group, so we focus on the fastest-growing markets and innovating and bringing new technology and new products to these markets.
We also have been growing through acquisitions. We've grown, since I joined the company, from about $250 million to over $500 million in revenues. So we've been growing at a CAGR of about 15%, and that's far greater than the industry and most of our peer group.
While the nature of the semi industry is cyclical, if you pick the right segments within the sector to focus on and you execute, then you can grow. That's what we're proving, and obviously, we are doing that at the expense of some of the other competitors out there.
TWST: Semtech's CFO, Emeka Chukwu, says the company's focus on the fastest-growing segments has allowed Semtech to outgrow its competition during this slow macroeconomic environment. Also, the company recently ranked 88th on Fortune's 2012 Top 100 Fastest-Growing Companies. Do you expect this segment focus to continue? Is it sustainable?
Mr. Maheswaran: Yes, I do think it is sustainable. Again, it's mostly because we're able to focus on markets that are fast growing. In the consumer market, we're focused on applications for smartphones, tablets, LCD TVs and high-performance interfaces, like the Thunderbolt cable market. We're also benefiting from the deployment of high-bandwidth infrastructure in the communications space and selling into optical transport networks, point-to-point base stations, IP backhaul and high-definition video applications.
In the enterprise computing space, which is becoming a really fast-growing market, we're seeing growth in the data center, cloud computing segments of the market, servers and storage area networking. In the industrial market, we are benefiting from growth in smart lighting, smart energy, home automation, security and smart metering and similar segments. By focusing on these fast-growing, and in some cases, emerging markets, establishing an early position and bringing innovative technology to those markets, I believe we can continue to grow.
TWST: Because of the 4G wireless upgrade cycle underway in the U.S., Semtech has been described as the go-to company because of its serializer or deserializer products. It's said that you either build your own, or you go to Semtech and buy it. Please describe some of these products and some of Semtech's other technology today.
For more from this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.