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Technology Stocks : RF Micro Devices (RFMD) -- Ignore unavailable to you. Want to Upgrade?

To: The Ox who wrote (4053)	1/10/2002 2:57:03 PM
From: Don Green	Respond to of 4849

RF Micro to announce large contract in March quarter January 10, 2002 2:50:00 PM ET NEW YORK, Jan 10 (Reuters) - RF Micro Devices Inc. (RFMD), which makes circuits for mobile telephones and other wireless systems, has begun shipments under a new contract with a large handset maker, the company's chief financial officer said on Thursday. "You'll see us begin ramping a major handset win with a first-tier manufacturer in the March quarter," Dean Priddy told investors at a Needham & Co. conference in New York. "In fact, we've already begun shipments with that customer." He did not identify the customer. RF Micro's largest customers are the two biggest wireless phone makers -- Finland's Nokia (NOK) and Motorola Inc. (MOT). In November, Merrill Lynch said RF Micro had won a contract for Siemens AG of Germany's GPRS, or general packet radio service, wireless phones, and was awarded the power amplifier design contract for Motorola's upcoming 1xRTT phone that could represent a potential $24 million in 2002. RF Micro's stock was up $2.26, or 13 percent, at $19.28 in????n Nasdaq. Since the beginning of last year, RF Micro shares have slightly outperformed those of its peers in the Nasdaq 100 Index. . Wachovia Securities analyst Mark Roberts said investors are infatuated with RF Micro. "RFMD is a stock that people love to love, and they will use almost any news as a pretext to be positive," he said. Priddy said Greensboro, North Carolina-based RF Micro also will announce contract wins with other handset makers over the next six months as the company works to diversify its customer base. The company expects to continue increasing market share in its core power amplifier business, he added. It also expects global handset sales this year to rise by 10 percent to 20 percent. Priddy said he is optimistic about prospects for RF Micro's near-term gross profit margins, which could rise as high as the low-40 percent range from 37 percent in the September quarter. The company has a long-term target for gross margins of 48 percent to 50 percent. Priddy said the company is probably 12 months to 18 months away from achieving that goal, depending on the introduction of next-generation products now in development. The wireless local area network (LAN) market will be a high-growth market over the next several years for RF Micro, he said. The company began shipping wireless LAN products in the December quarter. RF Micro also expects to recognize revenues in the March quarter from global positioning system (GPS) products, and expects to introduce in the same quarter products developed to work with Bluetooth, a wireless connectivity technology for linking laptop computers, wireless phones and other devices. Priddy reiterated that the company expects to post fiscal third-quarter revenues of $99 million to $103 million. He said last week that RF Micro expected earnings per share in the quarter, ended December, of 1 cent to 2 cents on those revenues. He did not provide any forecasts for the March quarter. RF Micro achieved profitability in its fiscal second quarter, ended in September, a quarter ahead of most analysts' expectations. Credit Suisse First Boston analyst Michael Masdea, in a research note on Wednesday, said RF Micro could surpass his third-quarter expectations of revenues of $101.5 million and earnings of 2 cents a share. He cut his March quarter estimates because of inventory concerns, but said RF Micro will outgrow the market due to its growing relationship with Nokia, new business with other large manufacturers, and growing market share. REUTERS © 2002 Reuters