So, why did they buy this company again? Mark
From Electronic News--June 14, 1999
Cyrix May Be Shut by National
National loses $783M in Q4
By Carol Haber
National Semiconductor last week said it plans to shut its Cyrix microprocessor business if a buyer isn't found by the end of the month.
The announcement came as National reported a $783.5 million loss for its fiscal fourth quarter, which mostly included the charge for exiting the PC microprocessor business and selling a related wafer fab in South Portland, Maine. National had a $40 million loss in the quarter excluding those charges.
"We are at this point talking to potential buyers and have indicated that we are working on an accelerated time frame and that we need a solid and acceptable bid on the table by the June 30," said Donald Macleod, chief financial officer, during a phone conference call with analysts last week. "If we don't have an acceptable bid by that date, we will begin to close that business down and let the affected employees down in Richardson (Texas) go."
Cyrix could be a tough sell. Intel has been relentless in pursuing the low-end PC market recently, and as a result no other PC MPU vendor has been able to turn a profit. "Not everyone is going to tread easily into a business that competes with Intel," said Arun Veerappan, analyst, BancBoston Robertson Stephens.
National reported a loss of $40 million, or 24 cents per share, on revenues of $486 million before one-time charges, for its fourth quarter 1999 ended May 30. Including charges, the company reported a loss of $783.5 million, or $4.65 per share, on revenues of $477 million.
In the comparable quarter of fiscal 1998, National reported a loss of $69.3 million, or 42 cents per share, before one-time charges, on revenues of $510 million, and a loss of $212.4 million, or $1.29 per share, including those charges, with no change in revenues.
The company took a one-time net restructuring charge of $688.4 million related to the decision to exit the standalone Cyrix PC processor business and to sell a majority interest in its 8-inch wafer manufacturing facility in South Portland. In connection with this announcement, the company also recorded one-time charges totaling $55.1 million against revenues, cost of sales and SG&A primarily related to processor inventory write-offs and product returns.
National said it would be profitable in the November quarter when Cyrix is history and cost reduction programs, including cuts in research and development and SG&A, kick in. The August quarter should show increasing improvement from the just-ended quarter.
"We are now on track to be profitable in the November quarter," said Brian L. Halla, CEO, during the phone conference."The PC processor business accounted for approximately $45 million in losses during the fourth quarter, and we will complete our exit from that business during the summer quarter."
He pointed to "a robust ongoing analog business that continues to show evidence of a broad-based recovery in the semiconductor marketplace." In addition, "The information appliance market is now becoming a reality for us," he said, citing recent pacts with Philips and Acer.
Meanwhile, National reported that bookings during the fourth quarter grew 17 percent over the third quarter and 23 percent over last year's fourth quarter. Excluding standalone Cyrix PC orders, new bookings grew 21 percent and 26 percent, respectively. After increasing significantly at the end of the third quarter, monthly orders continued strong throughout the fourth quarter, the company said.
For the year, National reported a loss of $220.6 million, or $1.32 per share, on revenues of $2.0 billion, before one-time charges. This compares with net profit of $72.7 million, or 44 cents per share, excluding charges, on revenues of $2.5 billion for fiscal 1998.
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